Businessmirror october 09, 2017

Washington SyCip passes away at 96 W ashington SyCip, founder of SGV & Co., one of the biggest and most sought-after accounting firms in the country, has died. He was 96.

A statement from SGV& Co. confirmed SyCip’s passing, and said his family “requests for some private time at this moment”. “Please pray for the eternal repose of his soul,” it added.

A statement from the Asian Institute of Management (AIM) said: “His passing is a great loss to the institution and the country’s business community, but his legacy will live on in the AIM alumni, who have become ethical and responsible business leaders, and who strive to live up to Mr. SyCip’s call to lead, inspire and transform.”

SyCip was one of the founders of

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A IM, one of the countr y’s foremost business schools.

Malacañang expressed its condolences to SyCip’s family, friends and colleagues.

A statement released by the Office of the Presidential Spokesman said SyCip was a “respected voice in corporate governance,” adding “he gave us all a sense of what F ilipinos could be”.

Fr. Jett Villarin, Ateneo de Manila president and a member of the Board of Governors of AIM, remembered SyCip as a compassionate man and a good mentor.

Speaking to CNN Philippines on Sunday, Villarin said, “Wash was a mentor. He was known for his business acumen, but, perhaps, what many people do not know was that his heart was also for Filipino people,

especially when it came to public education.”

“It was not just accounting, it was not just business—he was truly concerned about building our people,” Villarin said.

Philippine Airlines (PAL), where SyCip was a long-standing member of the board of directors, also issued a statement expressing their “sadness and grief over the passing of Mr. Washington SyCip”. The statement said SyCip was “a leader, advisor and guiding force behind many other Filipino businesses and philanthropic organizations, and an advocate for poverty alleviation, public education and economic freedom”.

“We feel his loss keenly, and will greatly miss his wise counsel and commanding presence,” they said.

Continued on A2

BusinessMirror A broader look at today’s business

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Monday, October 9, 2017 Vol. 12 No. 361

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@akosistellaBM Special to the BusinessMirror

HE first seven months of 2017 yielded foreign tourists numbering some 3.93 million, an increase of 11.02 percent from the same period in 2016.

Partial data obtained by the BusinessMirror also indicated that visitor receipts from January to July 2017 hit some P179.86 billion, an

increase of 21.07 percent from the same seven-month period in 2016.

Data from the Department of Tourism (DOT) suggested that the

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9.81

Alberto C. Agra

ead

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The average number of nights that tourists stayed in the country in July

continued surge in arrivals from China, as well as strong performances from various source markets in the Continued on A16

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7-mo tourism receipts up 21%, arrivals 11%

By Ma. Stella F. Arnaldo

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A

ll over the world, public-private partnerships (PPPs) are undertaken for roads. In the Philippines road infrastructure is done through either build-operate-transfer, build-transfer-operate, joint venture, concession or procurement arrangements with national government agencies, local governments or government corporations.

Continued on A15

Ateneo dean: Anticorruption drive anchored on fear of the President

By Elijah Felice E. Rosales

P

@alyasjah

resident Duterte might appear serious in addressing corruption in the government, but an expert argued the administration still has a long way to go in its anticorruption crusade.

Ateneo School of Government Dean Ronald U. Mendoza said the President’s anticorruption strategy is “personality-focused and less oriented toward building better governance systems”.

He added that Executive Order (EO) 2, which establishes a por-

This October 2 photo shows a woman praying inside a tent at the Tent City of Balo-i, Lanao del Norte. Proponents of a federal form of government argue that the current centralized system of government has not addressed the socioeconomic ills of areas far from the seat of the government, which is in Manila. NONIE REYES

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Part One

ROPONENTS of federalism argue that the country’s highly centralized government resulted to an imbalance in the distribution of resources in areas far from Manila.

They said of the country’s 18 regions, only three—Metro Manila, Central Luzon and Calabarzon—enjoy the lion share of 62 percent of the GDP with the rest

contending with the 39 percent.

Proponents also note that the diverse cultural heritage of Filipinos makes the country a “natural” federal nation. A local official put it more succinctly: the “federalism movement is a revolt against Imperial Manila.”

Opponents counter that the answer to a highly centralized government is simply decentralization, a process that has started since the enactment of the Local Government Code of 1991. They further

PESO exchange rates n US 51.0180

argue on the political risk of the “experiment”, citing Catalonia’s attempt to secede from Spain.

The foes of federalism added that political dynasty is the reason for rural poverty.

A third force in the federalism debate also appears to be developing. Those lobbying for the passage of the Bangsamoro basic law are neither passionate with the current unitary system of government nor actively Continued on A2

Mendoza was referring to the PNP’s policy restricting reporters from accessing police reports, a move that coincided with the war on drugs, which has reportedly claimed thousands of lives in police operations and vigilantestyle killings.

“An open and transparent governance model is also underpinned by strong data with high integrity,” Mendoza explained.

Duterte has fired government officials, including a Cabinet secretary, on allegations of corruption and involvement in anomalies.

Continued on A2

Planned lowering of minimum capital for foreign retailers to make local enterprises suffer–PCCI

BMReports T If federalism is the solution, what is the main problem?

By Alladin S. Diega | Correspondent

tal allowing citizens to look into government documents, seems to contradict transparency policies on the ground.

“Notwithstanding EO 2 opening the door for more freedom of information, it is not clear to what extent the administration really supports more transparent governance as a model of reform. Recently, for instance, the PNP [Philippine National Police] cut media access to spot reports on killings related to the government’s controversial antidrugs campaign,” Mendoza told the BusinessMirror.

he heads of the Philippine Chamber of Commerce and Industry (PCCI) have warned the government’s economic team to tread lightly on the suggestion to lower the minimum retail capitalization for foreign investors from the current $2.5 million to $200,000.

T he y note d t h at s uc h a n amount will attract foreign micro and small retailers into the country and crowd out the already struggling local micro and small enterprises.

“We’ve been f looded by questions from our members, and we don’t know how to answer it. We still don’t have the details. What I’m saying is, if you don’t have sufficient reason to lower it, then why do it?” PCCI Chairman Sergio R. Ortiz-Luis Jr. said, as he questioned the an-

Ortiz-Luis :“It’s difficult enough that our entrepreneurs have problems in locations and credit, why crowd them out too?”

nouncement made last week by Socioeconomic Planning Secretary Ernesto M. Pernia that the retail sector will be liberalized further. PCCI President George T. Barcelon pointed out that a minimum paid-up capital of only $200,000 may attract foreign investors who will just make the Philippines a testing ground and really have no long-term plans to contribute to the economy.

“We do want to attract investments, but let’s be prudent in the

sense that we want to attract the legitimate companies with substantial capital and technology to come in,” Barcelon stressed.

Ortiz-Luis added that having a higher minimum foreign investment cap will attract the strategic foreign investments with accompanying technology and innovation in the retail space. The smaller retail players, he said, will just be unnecessary competitors. “[That] $200,000 for foreign investors is the capitalization of their micro businesses. Foreign retailers that will come in here will probably borrow that money here, too, and crowd out our small and medium businesses. It’s difficult enough that our entrepreneurs have problems in locations and credit, why crowd them out too?” the PCCI chairman emphasized.

See “Capital,” A16

n japan 0.4522 n UK 66.9407 n HK 6.5328 n CHINA 7.6638 n singapore 37.4032 n australia 39.7634 n EU 59.7523 n SAUDI arabia 13.6048

Source: BSP (6 October 2017 )

BMReports BusinessMirror

A2 Monday, October 9, 2017

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If federalism is the solution, what is the main problem?

Continued from A1

suppor t i ng t he proposed pa rl i a ment within a federal system. Aside from the groups, there are individuals who add zest to the already- sumptuous dinner served in the dining table of the Federalism debate.

While these different entities offer divergent views on federalism, they are, however, united in saying that a shift to a federal system of government is not a new idea.

However, for Philippine Institute for Development Studies (PIDS) President Gilberto Llanto, if Federalism is being touted as a solution, it should address a problem.

“Policy-makers should see merit in examining whether federalism can, indeed, address the sociopolitical and economic problems that hamper the country’s growth.”

Proposals, proponents

SENATE President Aquilino L. Pimentel III is being supported by his father, former Senate President Aquilino Q. Pimentel Jr., a longtime Federalism advocate, in pushing for the country’s shift to a “uniquely Filipino” federal system.

In a forum in June, both Pimentels said that the unitary system that has concentrated power and funds to the central government has hampered development in the countryside.

To further articulate their proposals, and to accommodate mounting ideas for

federalism, the younger Pimentel sought the help of the Partido Demokratiko Pilipino-Lakas ng Bayan Federalism Institute (PDP-Laban FI).

We studied our 25-year experience of devolution under the LGC, our 20-year experience with the Autonomous Region in Muslim Mindanao, as well as many models of federalism, decentralization and political arrangements from around the world, according to Jonathan E. Malaya, the PDPLaban FI executive director.

Salient features of the proposal include a shift to a federal government (FG) with a semi-Presidential system (SPS) or a hybrid parliamentary system similar to the governments in Taiwan, South Korea, Portugal and, to a certain extent, France. It also features a transition mechanism for regional governments to prepare themselves for further decentralization, provisions to strengthen political parties, mechanisms to regulate political dynasties and other political and electoral reforms.

FG, RGs

IN a briefing paper, Malaya explained “there shall be two Constitutionally established orders or levels of government: the [FG] and the regional government [RG].” “ Un l i ke t he present system where t here a re overl appi ng m a nd ates be tween the national government and local

government Units (LGUs), each level of government in the federal structure will have its particular jurisdiction.”

According to Malaya, the FG shall have exclusive legislative powers over national defense, the police and national security, foreign affairs, currency, immigration and other matters that concern the entire nation.

Under the SPS, the executive power of the president is dispersed among the President, the Prime Minister, the Cabinet, the Parliament and the RGs. The logic for this division of executive powers in the context of the Philippines lies in four major elements, Malaya explained.

“First, in the transition to a more decentralized system of governance, we need a popularly elected presidency to hold and unite the country together and ensure that the transition to Federalism and transfer of powers to the regions will be successful,” he said. “The President can help as an arbiter of disputes between the federal and regional governments and among regional governments.”

Under the transition period and even beyond, Malaya said there is a need for an “effective president to deal with powerful countries like China and the United States, as well as to effectively compete in a globalized world economy”.

A third element is having a president who can decisively address the numerous national security problems and natural disasters,

Washington SyCip passes away at 96 Continued from A1

A giant of business

ACCORDING to Malaya, the division of executive powers is based on the Philippines’s context of a lack of a president who can ensure “there is no gridlock in our political system”.

We need a president who can remain decisive in cases of national crises, he added.

Hence, Malaya and the PDP-Laban FI is urging for having both a President and a Prime Minister as leaders of the country.

The President, who is nationally elected, shall be the Head of State, while the Prime Minister is the Head of Government and handles the day-to-day affairs of government, he explained. Malaya and his group are also emphatic on having a transition period so that Federalism could succeed.

“We should learn from the painful experience we had with the devolution of health services, etc., under the 1991 LGC, wherein no smooth transition-mechanism was put in place,”Malaya said during a forum on Federalism in Zamboanga in September. “Since the shift to a federal system will impact on practically all government agencies and levels of government, the transition must be slow, deliberate and purposeful.”

SyCip was the founder of the SGV Group and the AIM, one of the foremost business schools in the country.

He was a recipient of the Ramon Magsaysay Award for International Understanding in 1992.

He also served in the Board of Century Propertis Inc.; ABS-CBN Lingkod Kapamilya Foundation Inc.; Philippine National Bank; Metro Pacific Investments Corp.; and PAL Holdings Inc. SyCip was born in Manila in June 1921.

At 17 years old, he graduated summa cum laude from the University of Santo Tomas with a degree in commerce. He became a Certified Public Accountant at 18, but was not able to practice because he was too young to receive a professional license.

He left the country to pursue his PhD in Columbia University in the US and returned after World War II to establish what was to become SyCip, Gorres, Velayo & Co. (SGV).

SyCip became the first chairman of the AIM in 1968. He retired from SGV in 1996.

SyCip is survived by his wife Anna Yu, and his children Victoria, George and Robert.

To be continued

CNN Philippines

according to Malaya. “Fourth, a pure parliamentary system without strong political parties can be unstable,” he added. “It will take time to build strong political parties.”

Gridlock

Ateneo dean: Anticorruption drive anchored on fear of the President Continued from A1

Former Interior Secretary Ismael D. Sueno, for one, was removed from the Cabinet in

April for purportedly entering into a dubious foreign loan agreement for the purchase of Rosenbauer fire trucks.

In defense, Sueno said the

purchase of the fire trucks was perfected into contract by the previous administration and he is only completing the terms of the deal. The government went on to

purchase the fire trucks.

The President also sacked former Dangerous Drugs Board (DDB) Chairman Benjamin P. Reyes for apparently contradicting

the administration’s claim on the number of drug users in the Philippines.

The DDB claimed there are about 1.8 million drug users in

the Philippines, well below the 4-million count of Duterte. “[The] chief of the DDB was fired for releasing official data based on tried and tested scientific procedures, because these data contradicted what the President thought was a much higher number of drug addicts in the country. This act may have a chilling effect on government bureaucrats reporting data that may not be favorable to ongoing government policy and strategy,” Mendoza said.

Mendoza added that “this does not bode well for accountability”, as no one knows where the Chief Executive got his numbers. He said it is even more confusing that Foreign Secretary Alan Peter S. Cayetano in September reported in the United Nations General Assembly there were 7 million drug users in the Philippines, casting doubts on the success rate of the war on drugs.

“Anticorruption under the Duterte administration seems to be anchored on fear of the President,” Mendoza said.

If Duterte intends to address corruption, the Ateneo dean urged him to build around “lasting reforms”, instead of attacking government officials and removing them in office without due diligence.

“The concentration of power in the hands of some officials— including the police under the antidrugs campaign—further raises the risk of abuse. Power with high discretion on how to use it, coupled with little accountability, almost always opens the door to even more corruption,” Mendoza said.

The President last Wednesday issued Executive Order 43 creating the Presidential AntiCorruption Commission. The commission is responsible for assisting the Chief Executive in investigating presidential appointees allegedly involved in graft and corrupt practices. It covers presidential appointees inside and outside the Executive branch, including high-ranking military and police officers.

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A4 Monday, October 9, 2017 • Editors: Vittorio V. Vitug and Max V. de Leon

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Filipino businessmen bothered by political noise

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he Philippine Chamber of Commerce and Industry (PCCI), the country’s largest business organization, advised the Duterte administration to keep its focus on ways to move forward its economic agenda and not to be sidetracked by political spats.

PCCI President George T. Barcelon said the unfolding disputes between President Duterte and Ombudsman Conchita Carpio Morales

and Supreme Court Chief Justice Maria Lourdes Sereno are taking the attention away from the gains on the economic front.

“Let me put it this way, if I was an investor and I was looking at the Philippines as an investment target in the beginning or even the middle of the year, the picture would have been more encouraging,” Barcelon aired during the news briefing for the 43rd Philippine Business Conference to be held at the Manila Hotel on October 18 and 19.

The PCCI head said the daily reports churned out by most news outlets are “unsettling”, painting a situation of chaos and political turmoil to international investors.

“The government’s economic team is not slowing down, but the perception can be unsettling.

Hopefully, things can quiet down,” he added.

Right now, he said the progress in different areas, such as road infrastructure, the updating of the subway project, and the night-time facilities in some regional airports, are being dwarfed by the reports on Duterte’s quarrels with other ranking officials.

Getting more attention today are the impeachment complaints against government officials and the investigation on the alleged unexplained wealth of Duterte, Barcelon added.

Morales and the chief executive are at loggerheads, as the Ombudsman launched a probe into Duterte’s family bank transactions based on a complaint filed by opposition Senator Antonio Trillanes IV. Duterte, on the other hand, appears convinced by corruption allega-

The government’s economic team is not slowing down, but the perception can be unsettling.

Hopefully, things can quiet down.”

—Barcelon

tions against Sereno, calling her out in a recent speech in Davao, together with Morales.

Sereno is facing an impeachment complaint filed by lawyer Lorenzo Gadon for alleged corruption, culpable violation of the Constitution, and betrayal of public trust, among others.

Duterte has created an antigraft

body called the Presidential AntiCorruption Commission (PACC) to look into the administrative cases of presidential appointees in the Executive branch that involve graft and corruption. The PACC may also launch fact-finding inquiries and lifestyle checks on presidential appointees even outside the Executive Branch if they violate the Constitution. Catherine Pillas

Atienza hits Senate plan to remove Poe wants DFA to freeze passport price TRAIN provision on tax-free bonuses S

By Butch Fernandez

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minority lawmaker has questioned the move of the Senate junking the P100,000 tax-free bonuses and other benefits of employees in the first package of the Comprehensive Tax Reform Program (CTRP).

Deputy Minority Leader Lito Atienza of Buhay said the Upper House’s Senate Bill 1592 has removed the House of Representatives’s initiative to increase to P100,000 the aggregate amount of 13th month pay, Christmas bonus and other benefits that may be received tax-free by employees every year.

“The whole point of the higher ceiling for tax-exempt bonuses and other benefits is to help as many employees as possible. The higher the limit, the greater the number of potential beneficiar ies,” said Atienza, the senior deputy minority leader.

“On top of the mandatory 13th month pay, a growing number of employees are now getting Christmas bonuses, productivityincentive handouts, loyalty rewards, cash gifts and other benefits of similar nature, and they deserve to fully enjoy all these subsidies,” Atienza added.

The proposed first package of the CTRP—

also known as Tax Reform for Acceleration and Inclusion (TRAIN) Act—passed by the House in May raised from P82,000 to P100,000 the maximum amount of 13th month pay, Christmas bonus and other benefits that may be earned by employees free of withholding tax.

However, Atienza said the provision in House Bill (HB) 5636 was dumped when the Senate Ways and Means Committee sent the measure out for plenary debate and approval.

Under the Senate version of the bill, P100,000 tax-free bonuses will only cover those with four dependents.

“The exclusion is unfair to compensation earners who for years have endured the burden of paying for the lion’s share of all personal-income taxes,” Atienza said.

Profit sharing

Meanwhile, Atienza urged the leadership of the lower chamber to pass his HB 2625, or the proposed Profit-Sharing Act. He said his measure seeks to assure employees a rising standard of living.

“Our proposal is a great way to give employees a sense of ownership in the business, and for corporations to keep workers highly

driven and productive,” Atienza said.

Atienza added his proposal will require all corporations to distribute at least 10 percent of their annual net income to their employees as profit share.

Under HB 2625, the amount handed out by a corporation as the 10-percent profit share of its employees shall be treated as tax credit that may be used to pay for the firm’s income-tax obligations the following year.

The bill said shared profit shall not affect or diminish in any way the salaries, 13th month pay and other existing statutory, as well as collective bargaining agreementspecified benefits enjoyed by employees.

The measure added the total amount given by the company through profit sharing shall be creditable to his incometax return.

“This profit-sharing program would be derived from the net profit made by all companies, rather than increasing the minimum daily wage, which may not be feasible at this time. This measure might have more farreaching effects on laborers and workers, and would encourage them to work harder for the successful operation of their companies,” he said. Jovee Marie N. dela Cruz

@butchfBM

en. Grace Poe proposes to include a specific provision in the 2018 budget of the Department of Foreign Affairs (DFA), now under consideration in Congress, imposing a “price freeze” on passport-fee increases.

In a statement over the weekend, Poe vowed to press for adoption of an “antipassport price increase” provision in the DFA’s 2018 budget “in order to freeze the fee for the travel document even if its validity will be extended to 10 years pursuant to a new law.”

The senator is expected to introduce the amendment to the proposed P19.56-billion DFA budget for 2018 when senators resume plenary deliberations on the Executive department’s spending plan for next year. “We can add one line, which stipulates that the allocation is subject to the condition that the amount DFA will charge for a 10-year passport will not be increased and will remain the same as the fee for the current five-year passport.”

Poe said this provision can be imposed as a condition in appropriating P3.1 billion for the purchase of passport booklets next year. “If the number of pages will remain, then there is no reason to jack up the price,” the senator added.

Poe pointed out that the DFA charges P950 for “regular processing”, or passport delivery within 15 working days, and

P1,200 for “express processing” within seven working days.

The new law extending passport validity took effect after President Duterte signed into law on August 2 Republic Act 10928, which allows Philippine passport holders to use the travel document for 10 years from the previous five-year period, except for minors’ passport, which will be valid for only five years.

“We are keen to ensure that the new passport now with double five-year validity [10 years] will not cost double the previous amount for those who need to acquire new passports to travel abroad,” the senator said.

Poe acknowledged that for most Filipino travelers, the current 44-page passport, of which 39 pages are stampable, would suffice, as “not all Pinoys are jet setters”.

The senator suggested that should the DFA opt to issue new passports with more pages, “ then the best recourse is to maintain the current price, or call for extensive hearings, especially among OFWs, if they plan to charge more.”

Noting that some 3 million Filipinos apply for new passports or renewals every year, she said “there is no need for government to profit from issuing a document needed by overseas Filipino workers for their employment,” noting that OFWs sent home over P1.34 trillion last year. “An affordable passport fee is the payback for their sacrifice,” Poe added.

Duterte vows to make life hell for tax evaders

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alacañang last Saturday reminded businessmen to pay their taxes right and on time, saying the Duterte administration will not hesitate to try them in court should they opt to run away from paying their dues.

The statement came after Mighty Corp., the second-largest cigarette manufacturer in the Philippines, entered into a P40-billion compromise settlement with the government regarding its tax liability. The Wongchuking-owned enterprise was accused by the government of using fake tax stamps.

According to Presidential Spokesman Ernesto C. Abella, the settlement will significantly bolster the government’s infrastructure blitz.

“This landmark tax settlement is the largest in Philippine history; and will go a long way in funding the Duterte administration’s infrastructure program,”Abella said.

“Unpaid taxes result in less government revenues and stall the delivery of quality government services,” he added.

Abella also urged businessmen to pay their taxes right and on time, saying Duterte will not go easy on those

who will try to manipulate their way around the law.

“The President will be relentless in his campaign against corruption and delinquent taxpayers, haling violators to court, if necessary. As citizens cooperate, we build a comfortable life for all. Strong political will to benefit all, and not just a few, should be the trademark of the entire government,” Abella said.

Aside from Mighty Corp., the government was able to force Philippine Airlines (PAL) to pay its fees to the Civil Aviation Authority of the Philippines (Caap) and the Manila International

Airport Authority (Miaa). PAL last Friday committed to settle its P6-billion payable to the Caap and the Miaa.

“One of the overriding reasons PAL agreed to settle is to manifest its trust and confidence in President Duterte’s administration,” PAL said in a joint statement with the Department of Transportation.

The settlement came after the President told PAL to pay its debts to the government, or else he will have to shut down the Ninoy Aquino Internation Airport Terminal 2. PAL exclusively uses the terminal for its domestic and international flights. Elijah Felice E. Rosales

Feed maker PFMC responds to govt call for agri devt

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he Philippine Foremost Milling Corp. (PFMC), one of the country’s leading flour and animal-feed makers, has responded to President Duterte’s call on the private sector to help more livestock raisers, fisherfolk and farmers.

PFMC officials said the company is expanding its existing microentrepreneurial program, called “Pig Tiwala”, to cover more areas in Luzon and benefit more hog raisers.

Launched in 2016, Pig Tiwala provides qualified hog raisers 20 heads of piglets, including hog feeds to grow them. Through the program, a hog raiser is entrusted with a value of as much as P175,000 per growing cycle.

The company gets paid only upon harvest and sale of grown fatteners.

On top of the seed capital, hog farmers are supplied basic vitamins, technical assistance by PFMC veterinarians and marketing support to ensure good margins.

To date, Pig Tiwala has benefited

more than 400 hog raisers in Bulacan and Pampanga. The PMFC said it will expand the program to cover Laguna, Isabela and other parts of Luzon.

“We will continue this advocacy to promote the value of tiwala and entrepreneurship to help Filipino hog farmers,” said Jojie Angeles, PFMC executive proponent.

The PFMC’s shared value or investment in the program is now close to P116 million, an amount used for piglets and company-manufactured hog feeds that have been distributed among its farmer-partners since the program started last year.

With more than 25 years in the industry, the PFMC supports the government’s mission to increase productivity and meet growing demand for meat and other food products.

A world-class manufacturer of quality animal feeds, the PFMC’s known brands include Excel Feeds, Amigo Lechon for swine, poultry and aqua, and Iron Claw for game-fowl feeds.

Davao City Mayor Sara Duterte-Carpio (right) joins the Excel Feeds team led by Engr. Terence Uygongco, Philippine Foremost Milling Corp. vice president for Trade Feeds, during the 19th Davao Agri Trade Expo.

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Editor: Jennifer A. Ng • Monday, October 9, 2017

A5

PHL buying record-high agri goods from US

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he value of agricultural products that the Philippines will import from the United States this year would likely reach $2.75 billion, 10 percent higher than the $2.5-billion import bill recorded last year, according to the latest report of the Global Agricultural Information Network (Gain) report.

The Gain report, prepared by the US Department of Agriculture’s (USDA) Foreign Agricultural Service (FAS) in Manila, attributed the increase in the growing demand for food-related imports from the country’s expanding food sector.

“Traders forecast export sales in 2017 will increase 7 percent to $2.75 billion. Consumer-oriented food and beverage (F&B) products remain the best prospects for future export growth fueled by consumer confidence in the quality of American products and the steady expansion of the country’s retail, foodservice and food processing sectors.”

The Gain report noted that the projected $2.75 billion worth of agricultural imports this year is the highest value of in-bound shipments made by Manila from Washington since at least 1970.

The Philippines’s import bill for

F&B products this year is projected to breach the $1-billion mark, increasing by at least 2 percent from last year’s $923 million recorded value, according to the Gain report. In-bound shipment of F&B products is estimated to account for at least 36 percent of the Philippines’s total agricultural imports from the US this year.

“The Philippines continues to be the largest US market in Southeast Asia for consumer-oriented F&B products, with export sales of $923 million in 2016, up 2 percent from the previous year,” it said.

“Traders expect sales of US F&B products to the Philippines will surpass the $1-billion mark in 2017 as it did in 2014,” it added.

The US continues to be the Philippines’s largest supplier of agricultural products. The Philippines is its 11th-largest global market.

The Gain report said US agri-

cultural exports to the Philippines increased 11 percent to $2.5 billion in 2016, driven by a robust economy and strong consumer spending.

“The top US exports in 2016 were soybeans and soybean meal [$833 million], wheat [$592 million], dairy products [$227 million], red meats [$143 million], prepared food [$89 million], poultry meat and products [$77 million], processed vegetables [$72 million], fresh fruit [$65 million], snack foods [$63 million] and chocolate and cocoa products [$47 million],” the Gain report added.

According to the USDA, the Philippines is the second-largest market for US soybean meal (SBM), next to Mexico. Driven by a strong feed demand from the domestic hog and poultry industries, the USDA projected that SBM imports in 2017-2018 would reach 2.85 million metric ton.

The Philippines is also the top destination of fresh or chilled potatoes from the US. Data from the USDA showed American producers exported nearly $6.6 million of fresh or chilled potatoes to the Philippines in 2016.

Other American products that are shipped to the Philippines include pet food and processed food and beverages. In a previous GAIN report, the US is projected to increase its shipments of pet food to the Philippines by nearly 10 percent to $28.8 million this year, from $26.2 million a year ago. Jasper Emmanuel Y. Arcalas

The war on poverty

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uring the Arangkada Forum on September 14, there was much focus on sectors with substantial growth potential—including agriculture, creative industries, ICT, manufacturing, mining, logistics and tourism. In my panel, we discussed agriculture, creative industries and tourism. Inclusive growth and raising the poor out of poverty through employment generation were issues raised by all panelists, given the fact that the high rate of poverty and the high number of poor citizens has been a persistent development challenge in the Philippines.

Within the Asean region, Malaysia and Thailand have nearly eliminated poverty below $1.25 a day in their countries, while Indonesia and Vietnam have made better progress in this indicator of development than the Philippines. These countries in past decades (to varying degrees) have had more economic growth, more investment and quality job creation, fewer national disasters and better political and policy stability than the Philippines.

In recent years, however, the Philippines is doing better. With consistent stronger economic growth, higher domestic and foreign investment, better governance and a declining population growth rate, the poverty rate is declining. The targeted rate of reduction of the Duterte administration is 1.5 percent per year so that the percentage of Filipinos in poverty in 2022 will decline to 17 percent.

According to the Philippine Statistics Authority, farmers and fishermen are among the poorest in the country: “Among the nine basic sectors, farmers, fishermen and children belonging to families with income below the official poverty threshold or poor families posted the highest poverty incidences in 2015 at 34.3 percent, 34 percent and 31.4 percent, respectively. These sectors consistently registered as the three sectors with the highest poverty incidence in

Henry J. Schumacher

europe Beat 2006, 2009 and 2012. Also, 5 of the 9 basic sectors consisting of farmers, fishermen, children, self-employed, unpaid family workers and women, belonging to poor families had higher poverty incidence than the general population estimated at 21.6 percent in 2015.”

The poor are often hungry. Their diet is inadequate. Their children are frequently malnourished and stunted. In Metro Manila there are more than 300,000 families living without shelter and under bridges.

These families need a massive improvement in nutrition. Urban farming is one of the options to address this and improve the learning capacity of poor children in school. Better nutrition needs to go hand-in-hand with the Conditional Cash Transfer (CCT) program, or the Pantawid Pamilyang Pilipino Program, implemented by the Department of Social Welfare and Development. CCT now assists 4.4 million households totaling 20 million Filipinos. The transfers are provided directly to recipients on the condition that their children are inoculated and participate in school feeding programs to combat childhood diseases and malnutrition.

Total funding increased from P10 billion in 2010 to P79 billion in the 2017 budget.

Quite a number of recommendations were made at the Arangkada Forum to improve social-protection programs, including the government’s CCT program, to protect the poor (I selected a few).

Recommendations: n Continue to reduce number of poor in absolute terms and as percentage of population. n Continue to reduce the incidence of hunger. n Expand insurance coverage to include more poor. n Successfully implement expanded CCT program to include all 6.9 million poor families. n Implement unemployment insurance as a social safety net. n Enhance CCT program to ensure that the rights of poor children are upheld and to help child beneficiaries and their families to become more self-sufficient and selfreliant. (Urban farming is the way to go; the city of Quezon City is doing well along this line). n Create jobs and economic opportunities. Job creation in the industrial, agricultural and service sectors will be facilitated by the government, in collaboration with the private sector. n Implementation of national identifaiction card (ID) system for improved targeting of social services. Participants identified the pressing need to institute a national ID system that will allow government agencies to provide more targeted social services, and prevent double counting or leakage.

As the focus of my column is agribusiness, we need to deliver support services to farmers and fishermen, such as financing, incentives, technology, irrigation, post-harvest facilities, farm-to-market roads, improved logistics and integration in the supply chain to fully develop the potential of the agricultural industry to develop rural areas and the countryside.

As a consequence, some 20 million rural Filipinos can be lifted out of poverty. And the children of farmer will stop moving from rural areas to urban centers or become overseas Filipinoworkers. Isn’tthiswhatthe10-pointsocioeconomicagendaoftheDuterteadministration has in mind? Fighting poverty in agriculture?

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Monday, October 9, 2017

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Economic managers to brief US business leaders on investment prospects in PHL

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By Rea Cu

@ReaCuBM

he economic managers will hold the fourth Philippine Economic Briefing in New York City this week to update leaders of the American business community on key developments of the economy and where they may invest, according to the Department of Finance (DOF).

Finance Secretary Carlos G. Dominguez III said the briefing will be held ahead of the Annual Meetings of the World Bank and the International Monetary Fund, which will bring together the world’s central bankers, ministers of finance and other key government officials in Washington, D.C., to discuss the world economic outlook, aid effectiveness and other relevant concerns.

E xec ut ive Sec ret a r y Sa lv ador C .

Medialdea, secretaries Alan Peter S. Cayetano of the Department of Foreign Affairs, Ernesto M. Pernia of the National Economic and Development Authority, and Benjamin E. Diokno of the Department of Budget and Management, along with Bangko Sentral ng Pilipinas (BSP) Deputy Governor Diwa C. Gunigundo, will join the finance chief in New York City on October 11 for the fourth overseas Philippine Economic Briefing.

Jaime Augusto Zobel de Ayala, the chairman and CEO of the Ayala Group, is expected to take part in the briefing, with the theme “The Rising Philippine Economy: Powering Gains with Global Partners through Shared Goals”.

Deutsche Bank, Citi Group, Standard Chartered Bank and Morgan Stanley will jointly host the New York briefing.

Similar briefings were earlier held by the economic team in Singapore, China and Japan to inform business leaders in these countries of investment prospects in the Philippines.

Dominguez, together with BSP Governor Nestor A. Espenilla Jr., will proceed to Washington, D.C., to join other finance chiefs and central bankers from around the globe in the annual meetings of the two institutions.

In Washington, D.C., Dominguez will also speak before the Center for Strategic and International Studies, a policy research institution specializing in United States foreign policy, defense and security, economic integration and trade.

“This is an opportunity for us to present a better-rounded picture of where our country is right now and where we intend to go,” Dominguez said.

Mixed reactions to peso movement T

he local currency’s fluctuations in recent months have alarmed businessmen, but authorities see no immediate need to adjust key policy rates.

While a weaker peso is favorable for the export sector, recipients of overseas remittances and foreign investors, it is hurting firms that need to import raw materials.

For example, consumer companies rely heavily on imports of raw material, which hikes their production costs.

Softdrinks bottler Macay Holdings Inc. Chairman Alfredo Yao said a price increase is in the offing as importation costs have been on the rise. “[The price increase] will not just impact our direct importation but also affects our local suppliers, who need to import as well.

A lot of importers are already anticipating the price hike,” Yao said.

The company operates the Yao family’s beverage businesses through wholly owned

Govt to earn ₧24 billion in taxes annually from Mighty-JTI deal T

subsidiary ARC Refreshments Corp.

ARC Refreshments operates and maintains the business of bottling, distribution, marketing and sales of the RC Cola brand, Fruit Soda Orange and Juicy Lemon, among others.

Yao said the price hike will kick in before the year ends.

For Philippine Chamber of Commerce and Industry Chairman George T. Barcelon, there’s no need to ring the alarm bells.

“I don’t see the movement [of the peso] as leading to any drastic impact,” Barcelon said.

The Central Bank earlier assuaged fears, saying the weakening of the peso can be considered as a normalization of past appreciation of domestic currencies, and the peso is expected to remain broadly stable over the medium term.

On the last day of July the peso-dollar exchange rate stood at 50.46 to 1. Catherine Pillas

Finance chief confident Congress will approve revenue proposals

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he Department of Finance (DOF) estimates government revenues in the form of sin tax from the acquisition of Japan Tobacco International Inc. (JTI) of Mighty Corp. can reach P24 billion per year, assuming that cigarette demand remains constant.

Finance Secretary Carlos G. Dominguez III said an estimated P24 billion per year can be remitted to the government from the operations of JTI after its acquisition of Mighty Corp.

Earlier, the government agreed to accept the tax-settlement offer of Mighty Corp. amounting to P30 billion, including value-added tax (VAT).

From a series of raids earlier in the year, the government discovered fake tax stamps on a ton of cigarette packs bearing the logo of Mighty Corp. Some of the warehouses where the cigarette packs were found were leased to Mighty Corp.

“So, in effect, what did the government gain when we went after Mighty cigarette?

No. 1, we gained a onetime collection of P30 billion, including the VAT. Second, it looks like from their initial estimates, we are going to get another P24 billion a year, at least, and that’s every year assuming that the demand is just steady,” Dominguez told financial reporters.

The finance chief added that if JTI sells more cigarettes, the amount will also increase. But he pointed out the company might still be in the planning stage in terms of its marketing campaign.

T he Might y case proves that the Duterte administration’s efforts to go after tax evaders are getting dividends.

“The change in ownership between Mighty and JTI has really benefited the government and has achieved the goals of the sin tax, which is to raise the price of products that affect your health badly. So we just hope that the demand will also go down because the prices are up,” Dominguez added.

According to Bureau of Internal Revenue (BIR) Assistant Commissioner Teresita M. Angeles, the latest discussion with JTI bared that the company will be paying at least P40 million per week to the Philippine government.

“During the last discussion with the JTI group, they mentioned that they will be paying an amount of P40 million per week, so we are expecting the collection more or less to increase to P2 billion per month,” Angeles said.

In September the Philippine Competition Commission approved the sale of Mighty Corp. to JTI, with its settlement sum of around P21 billion having been remitted to the BIR in the same month.

The BIR has already received the first tranche of Mighty Corp.’s settlement offer of P3.44 billion on July 20, pointing out that the acceptance of the settlement does not preclude criminal charges the BIR may file against the homegrown tobacco firm as criminal cases cannot be compromised.

Dominguez added the windfall will significantly boost the national coffers at a time when the government has to find the resources to meet the unexpected costs arising from calamities and natural disasters. Rea Cu

he Department of Finance (DOF) is confident that Congress will approve the revenue streams proposed under the first package of the comprehensive tax-reform program (CTRP), pointing out that it should be sufficient to fund both the social programs and infrastructure projects of the Duterte administration.

Finance Secretary Carlos G. Dominguez III said the Development Budget Coordination Committee hopes that both houses of Congress will adopt the revenue proposals under package one for the government’s various projects.

“You know we are confident the legislature will come up with revenues that will be sufficient to fund all the various projects of the President, including both the social side, the educational side and the infrastructure side,” Dominguez told financial reporters.

The finance chief pointed out the progress of the first package, which is on track with the government’s projected timeline, and it is expected to be scrutinized by the bicameral committee in mid-November this year.

“We have every confidence that it will happen. In fact, the debates were concluded already, and we are just helping the Senate to do more calculations on their proposals,” he added.

The House version dubbed as the Tax Reform for Acceleration and Inclusion Act is expected to generate around P130

billion in revenues, while the Senate version under Senate Bill 1592 is estimated to generate revenues of P59.9 billion.

Under the DOF’s original proposal, an estimated P157 billion in revenues will result from the reduction of personal income-tax rates while implementing offsetting measures like the expansion of the taxpayer base, increasing excise tax on fuel and automobile products, as well as lifting some exemptions on valueadded tax (VAT).

“I am optimistic that the final bill will be closer to the House version. The personal income-tax rate hasn’t been changed since the time of [former President Fidel V.] Ramos, it has to be adjusted,” Budget Secretary Benjamin E. Diokno said.

Dominguez earlier said the DOF decided to introduce the CTRP through a series of packages rather than as a whole so that each would have a better chance of being approved by Congress at a much faster pace than it had done with previous tax-reform programs.

On top of enabling the government to better invest in people through better infrastructure, superior education, sufficient health services, adequate housing and reliable social protection, the CTRP will also consolidate the country’s macroeconomic position, ensure quality jobs for young Filipinos and create a dynamic business environment, according to the finance chief. Rea Cu

Perspectives Leadership, change, transformation management and the case for a business case

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n today’s era of unprecedented change, business leaders, starting with CEOs and board members, can play important roles as informed and decisive change agents on the road to transformation, particularly in light of the survey’s findings that lack of available funding is the topcited challenge (47 percent) to implementing new and innovative technologies, such as process and cognitive automation into the human-resources (HR) function.

Taking on the role of change agent will mean differentiating between how leaders have reacted historically versus how they should respond in today’s dramatically different world—while understanding the very real risk of inertia amid their uncertainty. Organizations on the path to transformation are demonstrating strong, proactive, and informed leadership. They define

themselves as among the movers rather than the followers, harnessing “the winds of change” to pursue initiatives that are uncomfortable but inevitable for future success.

Beyond leadership, many organizations are coming up short on change management. While a quarter of businesses told us that they view HR as a key business asset that can add strategic value, the biggest challenges cited in delivering strategic value include inadequate change-management capabilities (36 percent) and shortcomings in supporting new HR technologies (43 percent).

Strategic change management has been instrumental to the success of transformation initiatives that are well underway at UK-based A X A, according to Julie Scott, A X A’s Group HR COO, particularly in managing dramatic organizational changes that

are not always warmly received by employees. “There’s always going to be a degree of resistance, a fear of the unknown, when asking people to learn new skills and change their roles. That’s where change management comes in— it’s not a surprise to us, it’s just the biggest battle.”

T he transfor mation jour ney became far more complex than imagined this year for PotashCorp as it took on the unique challenge of transforming its HR function while merging the 5,000 -employee organization w ith Agrium to create a $36-billion business of 20,000 employees working in 18 countries.

“This is the rocket ship we strap ourselves to now in order to integrate companies, cultures and systems and assure future success,” says Lee Knafelc, senior vice president, Human Resources and Administration, PotashCorp. “Proac-

tive leadership, strategic change management and consistent communication simply must be there. Be decisive, act boldly and communicate, communicate, communicate.”

Organizations like PotashCorp and A X A are wisely focused on “the big picture” for successful transformation, taking a holistic, strategic view that articulates a comprehensive financial analysis, key organizational expectations, anticipated ROI, immediate and longer-term priorities and more. Unfortunately, the findings show many companies are going forward on transformation initiatives without first creating a business case to precisely define what change and success will actually look like.

Swiss Re Management Ltd. views transformation as a long-term initiative requiring exceptional focus and strategy to position the organi-

zation for future success. Improvements to date include new levels of cost efficiency and streamlined processes provided by intuitive new systems easily accessible for managers and employees.

The article “A call to action on the need for HR transformation — be a disruptor”

by Mark Spears and Robert Bolton, KPMG in the UK, and Mike DiClaudio, KPMG in the US, was taken from KPMG’s publication entitled “HR Transformation: Which lens are you using?” © 2017 R.G. Manabat & Co., a Philippine partnership and a member-firm of the KPMG network of independent memberfirms affiliated with KPMG International Cooperative (KPMG International), a Swiss entity. All rights reserved.

For more information on KPMG in the Philippines, you may visit www.kpmg. com.ph.

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Editor: Lyn Resurreccion • Monday, October 9, 2017 A7

Poor Americans don’t fare well under Trump’s tax-cut plan

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President Donald J. Trump speaks in Indianapolis in this September 27 photo. AP/Michael Conroy

ASHINGTON—President Donald J. Trump promised Americans “the largest tax cut in our country’s history.” But, for low-income households, Trump’s plan would amount to crumbs.

The poorest would get an average tax cut of about $60 a year, according to an analysis by the Tax Policy Center (TPC). Middle-income families

would get about $300 on average.

“There’s no significant benefit for low-income families,” said Elaine Maag, a senior research associate

$60 The average amount of tax cut the poorest get a year, while the middle-income families would get about $300 on average

Trump rattles saber at N. Korea: ‘One thing will work’

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resident Donald J. Trump returned to saber-rattling against North Korea, saying that “only one thing will work!” after years of diplomacy have failed, even as his counterpart in Pyongyang termed nuclear weapons a powerful deterrent.

“Presidents and their administrations have been talking to North Korea for 25 years, agreements made and massive amounts of money paid hasn’t worked, agreements violated before the ink was dry, makings fools of US negotiators,” Trump said in a pair of tweets.

“Sorry, but only one thing will work!” the president concluded to his 40 million Twitter followers in a message that at least implied he may have settled on a military option against North Korea and its leader Kim Jong Un. Last Saturday, leaving the White House to travel to North Carolina for a fund-raiser, Trump was asked

by reporters to clarify his comment.

“Well, you’ll figure that out pretty soon,” he said.

The remarks came two days after Trump cryptically said during a dinner with American military leaders that observers were witnessing “the calm before the storm.”

He refused to clarify the comment, adding only that “you’ll find out.” Last Saturday Trump said there was “nothing to clarify.”

North Korea’s Kim has heightened global tensions this year with a series of increasingly provocative missile launches and an underground nuclear test. The country’s foreign minister even floated the idea of exploding a warhead over the Pacific Ocean.

Public sniping

Two Russian lawmakers said this week that Kim is now planning to test a missile capable of reaching the US west coast, a range of approximately

9,000 miles (14,500 kilometers).

Kim and Trump have traded public barbs, leading the North Korean to contend that the US has declared war on his nation. While Secretary of State Rex Tillerson has sought a diplomatic solution, Trump said in a tweet last October 1 that the top US diplomat was “ wasting his time” trying to negotiate.

Kim spoke at length on the “complicated international situation” during a North Korean central committee meeting on Saturday, according to an official release.

He contended that United Nations economic sanctions had been “cooked up” by the US as part of “last-ditch efforts to completely stifle” North Korea’s right to existence and development.

Nuclear weapons are a “powerful deterrent firmly safeguarding the peace and security in the Korean peninsula,” Kim said, according to the release. Bloomberg News

Poll: Trump fares poorly in public’s view

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A SHINGTON— Just 24 percent of Americans believe the country is heading in the right direction after a tumultuous stretch for President Donald J. Trump that included the threat of war with North Korea, stormy complaints about hurricane relief and Trump’s equivocating about white supremacists.

That’s a 10-point drop since June according to a poll from The Associated Press-National Opinion Research Center (NORC) Center for Public Affairs Research.

The decline in optimism about the nation’s trajectory is particularly pronounced among Republicans. In June, 60 percent of Republicans said the country was headed in the right direction; now, it’s just 44 percent.

The broader picture for the president is grim, too. Nearly 70

percent of Americans say Trump isn’t level-headed, and majorities say he’s not honest or a strong leader.

More than 60 percent disapprove of how he is handling race relations, foreign policy and immigration, among other issues.

Overall, 67 percent of Americans disapprove of the job Trump is doing in office, including about one-third of Republicans.

Tracy Huelsman, a 40-year-old from Louisville, Kentucky, is among them. A self-described moderate Republican, Huelsman said she’s particularly concerned about the “divisiveness” she feels the president promotes on social media.

“It’s scary in 2017 that we are in what seems like a worse place in terms of division,” said Huelsman, who did not vote for Trump in last year’s election.

The assessments come after a

turbulent summer for Trump that included a major White House shake-up, bringing the departure of his chief of staff, top strategist and press secretary.

While the installment of retired Marine Gen. John Kelly as chief of staff has ushered in more day-to-day order in the West Wing, the president has still stirred up numerous controversies, including when he blamed “both sides” for the clashes between white supremacists and counter-protesters in Charlottesville, Virginia.

Trump has also raised the specter of a military conflict with North Korea over its nuclear provocations. He’s derided North Korea’s leader, Kim Jong Un, as “rocket man,” including during a speech at the United Nations, and has downplayed the prospects that diplomatic negotiations with Kim could yield results. AP

at the Tax Policy Center. “It’s important because when low-income families get money they tend to spend it, putting it right back into the economy. High-income families tend to save it.”

Republicans have backed a budget resolution that would enable Congress to pass a tax package that could add up to $1.5 trillion to the national debt over the next decade.

The Tax Policy Center’s analysis says most of the tax cuts would go to the wealthiest Americans. For example, the top 1 percent—families making about $700,000 a year—would get an average tax cut of $129,000.

Tax breaks targeting the wealthy include lowering the top income-tax rate from 39.6 percent to 35 percent, eliminating the alternative minimum tax, and doing away with the federal estate tax, which is only paid by people who inherit multimilliondollar estates.

Congressional Republicans dispute that their plan would ultimately help wealthy families more than it would help the middle class.

They note that the plan unveiled

by Trump and GOP leaders last week is incomplete. The plan would reduce the number of tax brackets from seven to three, but it doesn’t include the income levels for each tax bracket.

The plan would also increase the $1,000 child-tax credit, but it doesn’t say by how much. Those details are still being worked on.

“There is simply no way for [the] TPC or anyone to deliver these

kinds of specific estimates with the information provided in the framework,” said Sen. Orrin Hatch, Republican-Utah.

“To get their estimates, they filled in blanks with numbers from other proposals, added a pile of exceptionally pessimistic and biased economic assumptions and came up with a tax plan that, for all intents and purposes, is their own,” said Hatch, who chairs the Senate Finance Committee.

The Tax Policy Center says it filled in the blanks by taking numbers from a tax blueprint released by House Republicans. For example, the analysis assumes that the child-tax credit would increase to $1,500.

Republican Sens. Marco Rubio of Florida and Mike Lee of Utah want to increase the child-tax credit to $2,000. Rubio says doubling the credit is the best way to target tax relief for low- and middle-income families.

The main provisions that would affect low-income families are increasing the child-tax credit and raising the standard deduction from $6,300 to $12,000. This would be partially offset by eliminating the $4,050 personal exemption.

Also, the lowest tax rate would increase from 10 percent to 12 percent, but the plan doesn’t specify the income levels for each tax bracket.

In the Tax Policy Center’s analysis, low-income families make less than $25,000 a year. That puts them in the bottom 20 percent of households.

An analysis by the conservative Tax Foundation noted the plan’s lack of details. Nevertheless, it found only modest benefits for lowincome families, increasing their annual incomes by an average of less than 1 percent.

The liberal Center for Budget and Policy Priorities argues that if adding to the national debt leads to spending cuts, low-income families could be worse off.

“By increasing deficits and debt, the tax cuts would intensify pressure, likely in the next several years, for steep budget cuts in programs that help low- and middle-income families,” wrote Sharon Parrott, a senior fellow at the center. “Most low- and middle-income children and their families would likely lose more from these budget cuts than they would gain from the tax cuts.”

One reason the poorest families wouldn’t get much of a tax break is that many don’t pay federal income taxes. About 44 percent of US households pay no federal income tax, according to the Tax Policy Center. Most of these people pay other federal taxes, including payroll taxes.

However, when it comes to the income tax, most low-income families receive tax credits that are greater than the amount of taxes they owe.

They receive the tax credits in the form of a tax refund, even though they paid no taxes.

Maag said this would not change under Trump’s tax plan. AP

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Spanish, Catalan leaders urged: Negotiate

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ARCELONA, Spain—Thousands rallied in Madrid and Barcelona last Saturday in a last-ditch call for Spanish and Catalan leaders to stave off a national crisis, amid Catalonia’s threat to secede.

The rallies in the Spanish capital and the Catalan City were held with the slogan “Shall We Talk?” in an effort to push lawmakers in both cities to end months of silence and start negotiating. Attendees respected the organizers’ call to not bring the Spanish or Catalan flag.

Catalonia’s regional President Carles Puigdemont has vowed to make good on the results of last Sunday’s disputed referendum on secession won by the Yes side. Spanish Prime Minister Mariano Rajoy warned that the vote was illegal and has promised that Catalonia is going nowhere.

Protestors packed Barcelona’s Sant Jaume Square, where the Catalan government has its presidential palace, shouting “We want to talk!” and holding signs saying “More Negotiation, Less Testosterone!” and “Talk or Resign!”

“We have to find a new way forward,” said Miquel Iceta, the leader of Spain’s Socialist party in Catalonia. “It’s the moment to listen to the people who are asking for the

problem to be solved through an agreement, and without precipitated and unilateral decisions.”

The gathering around Madrid’s Cibeles fountain boasted a huge banner demanding that leaders start talking. Some people chanted “Less hate, and more understanding!”

In a separate rally in Madrid’s Colon Square, thousands clamored for the unity of Spain and against any attempt by the northeastern region to break away. The crowd bristled with Spanish flags. Prounion forces will try to generate momentum last Sunday in a protest in Barcelona.

Other protests asking for dialogue were held in cities, including Valencia, Bilbao, Pamplona and Sanitago de Compostela, news agency Europa Press reported.

The calls for dialogue and unity come after a traumatic week, with riot police storming several polling stations in an unsuccessful attempt to impede the referendum. Instead, hundreds of voters were left in need of medical attention.

A man holds up sign reading in Spanish and Catalan language, “We Talk,” as he takes part in a rally calling to find a solution for the crisis with Catalonia’s secession at Plaza España square in the Basque city of Vitoria, northern Spain, last Saturday. AP/Alvaro Barrientos

Even though 2.2 million Catalan voted—with 90 percent backing independence—the referendum polled less than half of the region’s electorate. Puigdemont declared he would seek a declaration of independence in the regional parliament anyway.

The bloodied vote was followed by a strike last Tuesday across Catalonia to protest the police violence.

Then came the stern message from Spain’s King Felipe VI that the Catalan government and parliament were breaking the law.

Puigdemont and his separatist

supporters were struck a blow when Catalonia’s top 2 banks, CaixaBank and Banco Sabadell, as well as energy giant Gas Natural, announced they were relocating their headquarters from Catalonia to other parts of Spain. Other companies are considering such a move to ensure that the region’s possible secession wouldn’t knock them out of the European Union and its lucrative common market.

Spain’s Minister of Public Works Iñigo de la Serna said last Saturday that “the companies will keep leaving and it’s exclusively the fault of

the members of the regional government.” The warnings by the business sector have coincided with the first calls from within Puigdemont’s government to hold off on a declaration of independence.

Santi Vila, Catalonia’s regional chief for business, told Cadena SER Radio late last Friday that he’s pushing for “a new opportunity for dialogue” with Spanish authorities.

“We have to give it one more chance, maybe the last chance and, perhaps, the only way that can happen is to start with a cease-fire,” Vila said.

Vila added he would like to see Spanish authorities return powers to the region which they have assumed in recent weeks, including control of a large part of its finances.

It is unclear how widespread Vila’s moderate position is inside the Catalan government, which is being pressured by separatist grassroots groups and the far-left party Popular Unity Candidacy to declare independence soon.

Separat ist l aw ma kers had planned to discuss a secession plan on Monday, but that session in the regional parliament was suspended by the Constitutional Court.

The focus has shifted to Tuesday, when Puigdemont is set to address the regional parliament “to report on the current political situation.”

The most recent polls taken before the referendum showed that the region’s 7.5 million residents were roughly split on the issue. AP

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Nate closes in on Mississippi

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EW ORLEANS—Hurricane Nate came ashore on a sparsely populated area at the mouth of the Mississippi River last Saturday and closed in on Mississippi, pelting the central Gulf Coast region with strong winds and heavy rains.

Nate was forecast to make its second landfall near Biloxi, Mississippi, and threatened to inundate homes and businesses. The center of the storm passed to the east of New Orleans, sparing the city its most ferocious winds and storm surge. And its quick speed lessened the likelihood of prolonged rain that would tax the city’s weakened drainage pump system. The city famous for all-night partying was placed under a curfew, effective at 7 p.m., but the mayor lifted it when it appeared the storm would cause little problems for the city. Still, the streets were not nearly as crowded as they typically are on a Saturday night.

Along the Mississippi coast, cities, such as Gulfport and Biloxi, were on high alert. Some beachfront hotels and casinos were evacuated, and rain began falling on the region last Saturday. Forecasters called for 3 inches to 6 inches (7 centimeters to 15 cm) with as much as 10 inches (25 cm) in some isolated places.

Nate weakened slightly and was a Category 1 storm with maximum winds of 85 miles per hour (137 kilometres per hour) when it made landfall in a sparsely populated area of Plaquemines Parish.

Forecasters had said it was possible that it could strengthen to a Category 2, but that seemed less likely as the night wore on.

Storm surge threatened low-lying communities in southeast Louisiana, eastward to the Alabama fishing village of Bayou la Batre. AP

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Kim Jong Un boosts sister within N. Korea’s inner circle

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orth Korean leader Kim Jong Un has promoted his 28-year-old sister to the ruling party’s political wing, bringing her closer to the center of power and tightening the family’s control on the regime.

The promotion of Kim Yo Jong took place at a Workers’ Party convention last Saturday in Pyongyang, where Kim Jong Un called for continuing nuclear-arms development to defend against what he called “US imperialists’ nuclear blackmail,” according to the official Korean Central News Agency.

“The present situation is stern and we are faced with ordeals,” Kim told the meeting as the party promoted dozens of officials, including his younger sister as an alternate member of the Political Bureau of the Party Central Committee. The bureau is led by Kim Jong Un and serves as the party’s core decisionmaking body.

Kim Yo Jong, a vice director at the party’s propaganda department, was sanctioned along with six other North Korean officials in January by the US Department of the Treasury’s Office of Foreign Assets Control for “human-rights abuses and censorship activities.”

Treasury gave her age as 28.

Kim Jong Un and Kim Yo Jong were born to the same mother, Ko Yong Hui. Their half-brother, Kim Jong Nam, was murdered in February at a Malaysian airport with the chemical weapon VX, an at-

tack in which North Korea denies it played a role.

Kim Jong Nam had lived outside North Korea for years and occasionally made comments critical of the regime.

Family deaths

Kim Jong Nam isn’t the first family member to be killed since Kim Jong Un took power in 2011, after the death of his father Kim Jong Il. In 2013 Kim Jong Un executed his uncle Jang Song Thaek on charges of graft and factionalism. Jang once served as Kim Jong Un’s deputy, and his death led to the disappearance of the leader’s aunt, Kim Kyong Hui. Kim Yo Jong has since appeared more prominently in public and been seen as the most influential woman along with Kim Jong Un’s wife, Ri Sol Ju, in a country where family ties mean more than any title or rank. She often chooses to remain in her brother’s shadow at public events, while orchestrating North Korea’s cult of personality that began under her grandfather Kim Il Sung.

“She’s been recognized for the work she’s done in the past year to idolize Kim Jong Un,” said Yang Moo-jin, a professor at South Korea’s University of North Korean Studies. “Kim Jong Un is extending his father and grandfather’s practice of empowering family members.” Bloomberg News

Monday, October 9, 2017

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May plans Cabinet shake-up with Johnson in the firing line

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NITED Kingdom Prime Minister Theresa May would soon overhaul her team of top ministers in a bid to reassert her authority and end the government infighting that’s put Brexit talks in jeopardy.

Senior officials in May’s Conservative Party, speaking on condition of anonymity, want her to deal with Boris Johnson, who has angered colleagues by forging his own path on Brexit in the run up to what proved a disastrous party conference for May this week in Manchester.

In an interview with the Sunday Times, May sent a strong signal about her intentions when asked specifically what she planned to do about her rebellious foreign secretary, the former London mayor who’s a perennial contender for her job.

“It has never been my style to hide from a challenge and I’m not going to start now,” she told the newspaper.

“I’m the PM, and part of my job is to make sure I always have the best people in my Cabinet.”

May faced fresh calls to quit following a chaotic speech at the conference that she almost failed to finish after a prolonged coughing

fit. Grant Shapps, a former Conservative Party chairman, said last Friday he’s orchestrating a campaign to persuade her to step down—to which May responded by saying she’s providing the “calm leadership” the country needs.

Removing May now would throw Brexit negotiations into disarray. It would take as long as three months for the Tories to pick a new leader, and there are just 18 months to go until Britain tumbles out of the bloc. May made some concessions to Europe in a speech in Florence on September 22, injecting momentum into long-stalled talks.

With negotiations to resume on Monday in Brussels and investors rattled by the never-ending Westminster soap opera, May is moving to restore order. The reshuffle, according to the Sunday Times, would take place after an October 19 and 20 summit in Brussels, where May will be hoping for

Conservative Party Leader and Prime Minister Theresa May coughs during her address to delegates at the Conservative Party Conference at Manchester Central in Manchester, England, last Wednesday. AP/Rui Vieira

a breakthrough few think possible.

Senior Tories from Home Secretary Amber Rudd to Environment Secretary Michael Gove have rallied behind her in recent days. Still, the Sunday Times, citing Tories it didn’t identify, said half her Cabinet want her to stand down in the next two years.

Concerned that May’s government will collapse before Brexit is complete, European Union negotiators have held more frequent backroom talks with the opposition Labour Party, the Telegraph reported, citing people it didn’t identify. They want assurances Labour will honor

deals made with the Conservatives, the Telegraph said.

Conservatives remain anxious after May led them into a failed election campaign earlier this year.

Many believe she must quit before the next election, due in 2022, but worry that a leadership contest now will provoke an earlier vote that could result in a victory for Labour’s Jeremy Corbyn.

Shapps said about 30 lawmakers want a new Conservative leader and prime minister. That’s fewer than the 48 needed to trigger a leadership battle, so if May is determined to stay, she can—for now. Bloomberg News

A10 Monday, October 9, 2017

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N. Korean embassies host proms, sell cows for cash

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OFIA, Bulgaria—While the embassies of most countries promote the interests of companies back home, North Korea’s are in business for themselves.

A series of tough sanctions by the United Nations and an executive order recently signed by President Donald J. Trump have sought to economically isolate the nucleararmed regime of Kim Jong Un. But Pyongyang has held on to an array of profit-making ventures, some of which operate in the roughly 40 embassies of the hermit kingdom.

Many of these enterprises are hard to trace, but at least one is impossible to miss.

For years, neighbors have complained about the noise coming from a large, fenced-in building here in a southern section of Bulgaria’s capital city. It hosts parties a few times a week, many of them capped off with a late-night flurry of fireworks, shot from the roof.

“It isn’t loud now,” one neighbor, Bonka Nikolova, said as a parade of wedding guests filed into the building. “But if they paid for fireworks, there will be fireworks.”

Nikolova has called the police, but there isn’t much they can do.

The building, filled with gilded halls that can be rented for events, enjoys a kind of diplomatic immunity courtesy of its owner: the government of North Korea.

North Korean embassies have spent decades running cash-raising schemes, nearly all them illicit under current international law.

Diplomats and their underlings have brokered deals for weapons and drugs and more mundane products, like machine tools and cows. They have also smuggled liquor, cigarettes, luxury cars and anything else that can be imported duty free and then sold at a gain.

“My late father-in-law was an ambassador,” said Marcus Noland, who studies North Korea and is an executive vice president of the Peterson Institute for International Economics, “and he told me that in India, years ago, it was known within the diplomatic corps that if you wanted to buy beef, you could

knock on the backdoor of the North Korean Embassy in Delhi. They ran an abattoir in the basement.”

Earning money is a necessity for the embassies—North Korea doesn’t fund them. Instead, they are expected to support themselves and send home any surplus.

Despite the sanctions it is under, North Korea did $6.5 billion in trade last year. Analysts estimate that embassy revenues represent a small sum compared with the country’s other low-profile foreign ventures.

Those included cadres of bodyguards leased to dictators who don’t trust their own citizens, laborers dispatched to work sites around the world who must remit their wages and state-owned companies that export ballistic missiles and other arms to countries like Syria.

In some cases, diplomats get involved with weapons deals. The third private secretary of the North Korean Embassy in Beijing doubled as an employee of Haegeumgang Trading Co. The company, according to a UN report, supplied surface-to-air missiles and radar systems to Mozambique.

Haegeumgang also sold machine tools, and an ad in 2014 for those products on a Chinese web site listed the company headquarters at the same address as the North Korean Embassy in Beijing.

China’s Ministry of Foreign Affairs did not respond to faxed questions.

Diplomats for the country have been ad hoc entrepreneurs since at least 1976. That year Norway’s police found through surveillance that every member of the North Korean Embassy in Oslo was involved in the import and sale of as many as 10,000 bottles of spirits and 100,000 cigarettes.

Today sanctions have forced many embassies to curb their ambitions, with some intent on keeping the lowest possible profile.

The North Korean Embassy in London sits unobtrusively in Ealing, a suburb-like section of London, just another brick house in a row of them. The difference is a small sign, barely visible from outside the wrought iron fence: “Residence and office, embassy of D.P.R. Korea.”

Besides black luxury sedans in the driveway, there are rarely signs of life in the building, even to neighbors.

“I’ve never seen anyone go in or out of there,” said Ali Wiseman, a student who lives in a group house two doors down. “And I’ve been here a year.”

His roommate, Rupert Thomson, has seen people there. “I once saw three women working on the lawn out front, and they did everything to not look at me,” he said.

The way that the London embassy sustains itself is a mystery.

One theory comes from Kim Joo Il, a former member of the North Korean military who defected and moved to London in 2007.

He said he often saw embassy employees at a type of Sunday flea market called a car-boot sale.

“They are always there buying secondhand electronics, toys, dolls, kitchen goods,” Kim said through an interpreter, seated at a restaurant he owns in a London suburb.

“Some of these things they are cleaning up and fixing to resell, others they are sending home to North Korea.”

North Korean embassies in the former Eastern Bloc, where the missions were long ago granted generous square footage, have a more lucrative stratagem.

In Poland 40 businesses are listed at the address of the North Korean Embassy in Warsaw, including a pharmaceutical company, several advertising agencies and a yacht club. How many of these businesses are actually staffed there is unclear.

In Sofia the embassy owns a number of buildings on two properties. One is a complex that includes the embassy itself. Passers-by can pause at a glass display case—standard issue for embassies in the city—filled with photographs. One captures the Supreme Leader beaming at a crowd, others were of missiles that had just been launched.

The North Korean embassy in Sofia, Bulgaria, one of its 40 or so embassies abroad. Unusual or illegal cash-raising schemes are the norm at North Korean embassies, which are expected to support themselves and send home any surplus. In Sofia the embassy owns an event space that hosts weddings, proms and corporate events. Dimitar Katsarov/The New York Times

40

The number of embassies of North Korea which are involved in profit-making ventures The event space, known as Terra Residence, is a 15-minute walk east.

It’s the former home of the North Korean ambassador, built in the 1980s with dazzle instead of comfort in mind.

Photos on Terra’s promotional web site show an interior that is essentially a communist take on Versailles—a series of huge and austere halls with chandeliers, gold curtains and paintings of ballerinas.

Terra rents out the space for magazine photo sessions, music videos and television ads, including a handful for national banks and one for the Bulgarian version

of Celebrity Apprentice. Its main business is weddings, proms and corporate events.

Few attendees, it seems, realize they are spending the evening on North Korean property.

“I knew it was a former embassy building, but I had no idea it was owned by North Korea,” said Bilyana Dimitrova, who attended a friend’s wedding at Terra in September. “The atmosphere was very pleasant.”

A spokesman for Terra, Anelia Baklova, wrote in an e-mail that the company has had a long-term lease with the Embassy of North Korea that predates the imposition of economic sanctions.

When the UN approved stricter sanctions, this year and last, Terra “froze” its payments, she said. The company has not been evicted, she wrote, because of the “considerable amount of money” it had spent on renovations and upkeep.

E-mails to the embassy were not returned.

Some countries have succeeded in shutting down businesses that rent from North Korea. In May Germany closed a youth hostel that was operating in what was originally

North Korean diplomatic quarters.

Governments of Poland and Bulgaria have been unable to end the ancillary activities. A spokesman for the Bulgarian Ministry of Foreign Affairs said it had repeatedly raised the issue of renting out space with North Korean officials here, urging them to “use properties in Sofia solely for diplomatic and consular activities.”

Terra, unlike its landlord, has tried to become a more agreeable neighbor. People who live across the street say that notices are now taped on the doors of their apartment building a day before there will be fireworks, giving a heads up and promising that the show will end by 10 p.m.

Surprisingly, residents didn’t seem particularly vexed about living near an enterprise that has pumped money into the world’s most repressive and notorious regime. But that may say more about Bulgaria’s government than the dangers of North Korea.

“When you live in a place where it’s so difficult to get even trivial stuff done,” Nikolova said, “it’s hard to worry about World War III.” New York Times News Service

Who was Stephen Paddock? The mystery of a nondescript ‘numbers guy’

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AS VEGAS—Stephen Paddock was a contradiction: a gambler who took no chances. A man with houses everywhere who did not really live in any of them. Someone who liked the high life of casinos but drove a nondescript minivan and dressed casually, even sloppily, in flip-flops and sweat suits. He did not use Facebook or Twitter, but spent the past 25 years staring at screens of video poker machines.

Paddock lived an intensely private, unsocial life that exploded into public view last week, when he killed 58 people at a country music festival and then shot himself. But even with nationwide scrutiny on his life, the mystery of who he was has only seemed to deepen.

Last Friday a law-enforcement official said Paddock’s girlfriend, Marilou Danley, told investigators that he seemed to be deteriorating in recent months both mentally and physically.

Perhaps, his methodical and systematic mind had turned in a lethal and unpredictable new direction. To the few people who knew him well, it is the only plausible explanation.

“I wish I could tell you he was a miserable bastard, that I hate him, that if I could have killed him myself, I would have,” said Eric Paddock, a younger brother. “But I can’t say that. It’s not who he was. We need to find out what happened to him. Something happened to my brother.”

Las Vegas police believe Paddock may have had a secret life. He had been buying guns since 1982. But something

seemed to change in October. He went on a shopping spree, adding to his arsenal until late last month. One of his purchases, a shotgun, came from Dixie Gunworx in Saint George, Utah. Chris Michel, the owner, said Paddock visited the store three times in January and February, making the 40-minute drive from Mesquite, Nevada.

When it came to guns, Michel said, “he was not a novice.”

The son of a bank robber and a secretary, Paddock grew up lower middle class in Southern California in the 1960s. From an early age, he focused on gaining complete control over his life and not having to rely on anyone.

He cycled through a series of jobs he thought would make him rich, Eric Paddock said.

“He went to work for the IRS [Internal Revenue Service] because he thought that’s where the money was, but it turned out the money wasn’t there,” Eric Paddock said. “He went to the aerospace industry, but the money wasn’t there either. He went to real estate, and that’s where the money was.”

Stephen Paddock began buying and refurbishing properties in economically depressed areas around Los Angeles, teaching himself how to put in plumbing and install air-conditioning.

By the late-1980s, “we had cash flow,” said Eric Paddock, who added that he had given his life savings to his older brother to invest and eventually became a partner in his company, because “that’s the kind of guy he was.

to do when he wanted to do it.”

‘Most boring’ son

In an undated handout image, 1256 W. 29th Street in Los Angeles, among the real-estate holdings of the Las Vegas gunman. Stephen Paddock, bought the 30-unit building in 1987, was reportedly a good landlord, and the properties were good investments. Paddock more than doubled his money on his California holdings, at least six multifamily residences. Google via The New York Times I knew he would succeed.”

“He helped make my mother and I affluent enough to be retired in comfort,” he said.

With success came a rigidity and uncompromising attitude, along with two failed marriages, both short and childless.

Stephen Paddock started gambling.

Some who met him described him as arrogant, with a strong sense of superiority.

“He acted like everybody worked for him and that he was above others,” said John Weinreich, 48, a former executive casino host at the Atlantis Casino Resort Spa in Reno, where he saw Paddock frequently from 2012 to 2014.

When Paddock wanted food while

he was gambling, he wanted it immediately and would order with more than one server if the meal did not arrive quickly enough.

Paddock cherished his solitude, his brother said. In 2003 he got his pilot’s license, eventually taking the extra step to get an instrument rating so that he could legally fly in cloudy conditions with limited visibility. He bought cookie-cutter houses in Texas and Nevada towns with small airports so that he could park his planes.

Even in death, Paddock seemed to stay true to his ways. He remained in control, answerable to no one but himself.

“If Steve decided it was time for Steve to go, Steve got up and left,” Eric Paddock said. “He did what he wanted

Paddock was the oldest, and least angry, of four boys growing up in the 1950s, said another brother, Patrick Benjamin Paddock II, 60, an engineer in Tucson, Arizona. Stephen Paddock was born in Iowa, the home state of their mother, Irene Hudson.

“My brother was the most boring one in the family,” Patrick Paddock said. “He was the least violent one in the family, over a 30-year history, so it’s like, Who?” Their father, Patrick Benjamin Paddock, also known as Benjamin Hoskins Paddock, was mostly absent, living a life of crime even before the boys were born.

His rap sheet was long and included writing bad checks, stealing cars and robbing banks. He was on the Federal Bureau of Investigation’s most wanted list. The agency described him as an avid bridge player, standing 6-foot-4 and weighing 245 pounds, who “has been diagnosed as being psychopathic, with possible suicidal tendencies.”

Stephen Paddock learned resourcefulness and self-reliance from an early age.

In 1960 when he was 7, his father went to prison for a series of bank robberies, and the family moved to Southern California.

Knack for making money Paddock spent his 20s and 30s trying to escape the unpredictability of poverty. He worked nights at an airport while going to California State University, Northridge, his brother Eric said,

and then at jobs with the IRS and as an auditor of defense contracts. But it was real estate that lifted Paddock to financial freedom.

In 1987 he bought a 30-unit building in Los Angeles, according to property records. Eric Paddock said the buildings they bought were not “Taj Mahals, but they were nice, safe places.”

Crucially, they were excellent investments: Stephen Paddock more than doubled his money on his California holdings, which included at least six multifamily residences, according to property records.

He made money in Texas, too. In 2012 he sold a 110-unit building in Mesquite, outside Dallas, for $8.3 million.

He was a good landlord. He kept the rents low, responded promptly to his tenants’ complaints, learned all their names and made sure they were happy.

He designed the ownership structure so his family would profit and installed his mother in a tidy house just behind the apartment complex in Mesquite, Texas.

By the 2000s, with both of his marriages long over, casinos became Paddock’s habitat. He liked being waited on, seeing shows and eating good food.

“You could tell that being in that highlimit gambling environment would lift him up,” said Weinreich, the Atlantis casino host in Reno. “He liked everyone doting on him.”

He sometimes called for company, inviting his brother Eric and his children for a free weekend in a luxury suite. But mostly he stayed alone. New York Times News Service

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Cambodia takes first legal step to dissolve opposition party

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HNOM PENH, Cambodia— Cambodia’s government last Friday took initial legal steps to dissolve the country’s main opposition party, the latest in a series of moves to gain an advantage ahead of next year’s general election.

Interior Ministry Spokesman Khieu Sopheak said the ministry filed a lawsuit with the Supreme Court asking for the Cambodia National Rescue Party (CNRP) to be dissolved on the grounds that it was involved in a plot to topple the government.

The court is likely to uphold the complaint, since the country’s court system is widely considered to be under the political influence of the government of Prime Minister Hun Sen. “This is a strongman’s coup d’etat, with Hun Sen shamelessly transforming himself into a dictator for the whole world to see,” said Phil Robertson, deputy Asia director for Human Rights Watch.

The CNRP is the only party besides the ruling Cambodian People’s Party (CPP) with representatives in parliament, and no third party comes close in terms of popularity and support. The CNRP posed an unexpectedly strong challenge in 2013’s general election and the government has since taken steps to tighten its grip on power.

Khieu Sopheak said the government had received “21 pieces of concrete evidence to prove that the opposition party has intentionally sought to topple the government through a ‘color revolution’”.

Hun Sen and his supporters have repeatedly warned that the type of pro-democracy popular movements that arose in the former Soviet Union and the Balkans in the early-2000s would cause chaos in Cambodia.

The CNRP has denied seeking to unlawfully or violently overthrow the government, saying the charge is politically motivated.

If the Supreme Court finds the opposition party guilty of violating the Political Party Law, not only would it be dissolved, but its leaders would be banned from involvement in politics for five years.

The ministry acted after it received complaints from two parties with no lawmakers in parliament that are generally believed to have been acting at the government’s behest.

CNRP leader Kem Sokha was charged last month with treason for allegedly working with the United States to stage a “color revolution” to oust Hun Sen, who has held power for more than three decades.

His arrest has sharply escalated political tensions and raised questions over whether the upcoming

elections could be free and fair.

“With this move, Prime Minister Hun Sen and the ruling CPP are killing Cambodian democracy by turning the July 2018 election into a bad joke,” Robertson said. “The government’s narrative that the opposition CNRP is leading a color revolution is yet another dimension of the politically motivated lie used to justify a crackdown on anyone who dares make critical comments about the government.”

Although he is being detained pending trial, a message posted on Kem Sokha’s Facebook page reacted to last Friday’s move by the government, saying that: “No other power can overcome the power of the will of the people. May the Cambodian compatriots unite in demanding justice for all Cambodians.”

Other opposition politicians were keeping a low profile and could not immediately be contacted.

The charge against Kem Sokha was based on videos from several years ago that showed him at a seminar where he spoke about receiving advice from US pro-democracy groups. He could face up to 30 years in prison.

Kem Sokha had been expected to lead the CNRP in next year’s election in a strong challenge against the ruling party.

In nationwide local elections in June, Hun Sen’s Cambodian People’s Party won most constituencies but received a weak majority of the popular vote, while the opposition party made gains.

In the past month, Hun Sen and his party have accelerated the use of legal and administrative measures to undermine critics and political foes.

After Kem Sokha’s arrest last month, Hun Sen warned that the CNRP was at risk of being dissolved.

“If this party continues to protect and defend this traitor, it means this party is also involved in treasonous acts and there is no need to allow this party to exist in our democratic society,” Hun Sen said in a speech. He said it did not matter if one party was dissolved because many other parties would take part in the election.

In other recent moves tightening the grip of his government, an independent English-language newspaper, The Cambodia Daily, was shut down after being accused of not paying a huge tax bill—an assessment it strongly disputed.

More than a dozen radio stations that broadcast dissident voices or used programming from the US government-funded Voice of America and Radio Free Asia were forced to stop broadcasting for alleged breach of regulations. AP

Bangladesh PM says government will continue to help Rohingya

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Newly arrived Rohingya children play in school playground in Kutupalong camp, Bangladesh. AP/Gemunu Amarasinghe

HAKA, Bangladesh—Bangladesh’s Prime Minister Sheikh Hasina said last Saturday that her government would continue to support nearly 1 million Rohingya Muslims who have fled neighboring Myanmar to escape violence.

Hasina said the government was pursuing a plan to build temporary shelters for the Rohingya on an island with the help of international aid agencies whom she praised for their support.

She made the statement at Dhaka airport on her return from New York after attending the UN General Assembly session. The UN has described the violence in Myanmar as “ethnic cleansing”.

Hasina accused Myanmar of creating tensions at the border, but said she has asked the country’s security forces to deal with the crisis “very carefully”.

“They pretended like they wanted a war,” she said.

More than 500,000 Rohingya Muslims have crossed over to Bangladesh since late-August, when Myanmar security forces responded to militant attacks with a broad crackdown that witnesses and rights groups say has included killing and arson.

17,000

The number of Rohingya, who the Myanmar government said it has stopped from fleeing in just four days last week An equal number of Rohingya Muslims have previously fled Myanmar since 1978.

Myanmar doesn’t recognize the Rohingya as an ethnic group, instead insisting they are Bengali migrants from Bangladesh living illegally in the country.

Myanmar has come under international criticism for failing to stop the recent violence in its Rakhine state and, in turn, an exodus that has become the largest refugee crisis to hit Asia in decades.

The Myanmar government’s in-

Kim’s murder trial to resume with lab visit for VX evidence

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UALA LUMPUR, Malaysia—The trial of two women accused of killing the estranged half brother of North Korea’s leader enters its second week with the court moving temporarily on Monday to a highsecurity laboratory to view evidence tainted with the toxic VX nerve agent.

High Court Judge Azmi Ariffin declared that prosecutors and defense lawyers, along with the two suspects, will hold court at the laboratory for chemical weapons analysis to examine samples of the women’s clothing before they are formally submitted as evidence.

The decision came after government chemist Raja Subramaniam told the court that VX found on the clothing may still be active.

Such a move is not unusual in criminal cases in Malaysia, where judges often visit crime scenes.

Hisyam Teh Poh Teik, lawyer for Vietnamese suspect Doan Thi Huong, told The Associated Press the visit to Raja’s lab is purely for safety reasons. He said the concept of holding a formal court session at the lab is to legalize the visit, which is expected to take an hour, after which the trial will resume in the court building.

Huong and Siti Aisyah of Indonesia pleaded not guilty at the start of their trial last week to charges of murdering Kim Jong Nam by smearing VX on his face at a crowded airport terminal in Kuala Lumpur, on February 13.

They face a mandatory death sentence

Editor: Max V. de Leon • Monday, October 9, 2017 A11

if convicted. Defense lawyers have said the women were duped by suspected North Korean agents into believing they were playing a harmless prank for a hidden TV-camera show.

VX is banned by an international treaty as a weapon of mass destruction but is believed to be part of North Korea’s chemical weapons arsenal.

Kim was the eldest son in the current generation of North Korea’s dynastic rulers but was believed to have been cast out by his father and had lived abroad for years. He reportedly never met current leader Kim Jong Un, who is widely believed to have perceived his older sibling as a threat and targeted him for assassination.

Last week VX-tainted evidence from Kim Jong Nam’s body and clothing was presented in court in sealed transparent bags. It was not removed from the bags, but the judge and court officials wore surgical masks and gloves as a safety precaution.

During the week’s four trial sessions, prosecutors sought to reconstruct Kim’s final moments at the airport, establish that VX killed him and provide evidence linking VX to the two suspects.

Raja, who is the only Malaysian with a doctorate in chemical weapons analysis, testified he found traces of VX on Huong’s white sweater and fingernail clippings, and on Aisyah’s sleeveless t-shirt. Huong was seen on airport surveillance videos wearing

a sweater emblazoned with big black letters reading “LOL”, the acronym for “laughing out loud”. Raja also confirmed that he found VX on Kim’s face, eyes, clothing and in his blood and urine samples.

Raja testified that VX can be safely removed from the palm of a hand by scrubbing it with water within 15 minutes of exposure, in a possible explanation of why the two women didn’t show any symptoms of poisoning.

Raja, the eighth witness to take the stand, is to be cross-examined by defense lawyers on Monday after the lab visit.

Pathologist Mohamad Shah Mahmood also testified there were no signs that a heart attack or other factors had contributed to Kim’s death. He concluded in his autopsy report that Kim died of “acute VX poisoning”.

“It’s no surprise,”said Hisyam, Huong’s lawyer. “We know their [prosecution] narration; we know the evidence that they have. We have a response; we have an answer to every evidence they have adduced so far.”

Gooi Soon Seong, the lawyer for Aisyah, has said the detection of VX on the women is not enough to convict them.

“If I have the knife, it doesn’t mean I killed the person. They must have other stronger evidence,” he said.

This week, prosecutors say they will present airport security videos that show the two women carrying out the attack and indicate they knew they were handling poison. AP

formation committee said late last Thursday that it had stopped 17,000 Rohingya from fleeing in just four days last week. Villagers, however, say that Rohingya are still attempting to leave and that many are gathered on the beaches just across the water from Bangladesh waiting for a chance to leave the country.

Last Saturday Hasina reiterated that the settlements for Rohingya Muslims would be temporary until they returned to their homes in Myanmar.

She said her government would continue to support them with food and shelter.

“If needed, we will eat a full meal once a day and share the rest with them,” she added.

More Rohingya Muslims fleeing violence in Myanmar streamed toward the border last Friday, despite government assurances that it was stopping the massive exodus of refugees to Bangladesh.

A video obtained by The Associated Press that villagers said was shot last Thursday in northern Rakhine state shows dozens of Rohingya attempting to swim across the currents of a muddy river, from where it is a more than 20-kilometer (12-mile) walk through jungles to the border. Many more people, from young children to old men, stand huddled with their belongings on the riverbank.

“The Myanmar authorities in northern Rakhine went to the border areas where thousands of Bengalis

await to flee and talked to them,” it said. “The local authorities told the Bengalis if they have difficulties with their livelihood, they will provide food and security and to return to their villages. The Bengalis agreed to stay,” the Myanmar government’s information committee said in a statement late last Thursday.

The government may have had some success in keeping Rohingya in Myanmar in recent days, but villagers say Rohingya are still attempting to leave and many are gathered on the beaches just across the water from Bangladesh waiting for a chance to leave the country.

“There are more than a thousand villagers at the beach in Alel Than Kyaw village off the shore trying to flee but the authorities are not letting them go,” one villager told the AP by phone last Friday. The villager spoke on condition of anonymity due to security concerns.

Bangladesh, in particular, has been pushing Myanmar to stem the tide of refugees, who are straining resources in the already poor nation.

The current exodus is in addition to hundreds of thousands of Rohingya who fled prior violence in Buddhistmajority Myanmar, where the Muslim ethnic group has faced decades of persecution and discrimination.

The latest violence began when a Rohingya insurgent group launched deadly attacks on security posts on August 25, prompting Myanmar’s military to launch “clearance operations.”

Those fleeing have described indiscriminate attacks by security forces and Buddhist mobs. The government has blamed the Rohingya, saying they set fire to their own homes, but the UN and others accuse it of ethnic cleansing.

Though Myanmar leader Aung San Suu Kyi has said the security forces have ceased clearance operation since early-September, witnesses say Rohingya villages continue to be burned in the region.

In a statement last Friday, Amnesty International said Myanmar’s security forces have engaged in an unlawful and disproportionate campaign of violence against the Rohingya. It urged the Asean to take urgent steps to stop its member-state from committing acts of violence against Rohingya.

Also last Friday, the Norwegian Refugee Council called on Myanmar authorities to allow aid groups access to those in need in northern Rakhine state. AP

Green Monday BusinessMirror

A12 Monday, October 9, 2017

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

Are you a responsible diner?

By Jonathan L. Mayuga @jonlmayuga

M

ore and more Filipinos are now willing to spend hardearned money to satisfy their craving for delicious food, which is giving the local tourism industry a boost.

Assorted Philippine food Wikimedia Commons

sa id shaping t he market w i l l require education of bot h t he consumers and producers.

“One thing we can do as consumers and community leaders is to share the benefits of consuming the kind of goods that will help shape consumer behavior by educating the public,” he said.

A study conducted by PCEPSDI some years back revealed that 70 percent of the market is willing to go for environment-friendly solutions and 90 percent of that are willing to buy “green” products, including food, Alvarez said.

He said the food-service industry has to offer value propositions in coming up with its products or menu, again, emphasizing the millennials as a big market.

“Millennials may have lowspending power but they have the critical mass. They go for organic.

They are shunning fast food; they are going back to the basics local food,” he said.

“From the business point of view, SCP and efficient processing can be converted into cash,” he added.

“So how do you make it efficient if you have the same value, the same market? [Through] efficiency. We can present that to the stakeholders from the point of view of the co-operators,” he said.

June M. Alvarez (left), executive director of the Philippine Center for Environmental Protection and Sustainable Development Inc., and Raoul Roberto P. Goco, executive chef of Degustation Restaurant Group and a board member of the Hotel and Restaurant Association of the Philippines. WWF-Philippines

Kare-kare GracinhaMarco Abundo/Wikimedia Commons

Moreover, in search of healthier options, many are going back to the basics—from fast food to slow food.

Players in the hotel and restaurant industry, hence, should take advantage of this trend and help shape the food-service industry toward sustainable tourism, environmental solution provider World Wide Fund for Nature (WWF-Philippines) said.

Launching its project, dubbed “The Responsible Diner: A Key Ingredient to Sustainable Tourism”, on September 26, WWFPhilippines held a forum to tackle ways on how to influence policymakers, players in food service industry and the Filipino public to adopt a policy and the practice of sustainable consumption and production (SCP).

What is sustainable dining?

For W W F - Ph i l ip pi nes, s u s tainable dining is eating in restaurants with food ingredients that come from environmentfriendly sources and operating in a sustainable manner.

Basically an information, education, communication and advocacy campaign, the project aims to address the challenges of coping with the forecasted growth in the tourism sector and take the opportunity to highlight and enhance the Filipino cuisine and to ensure sustainable tourism.

The project is pushing for a food-service policy review in the tourism sector to foster cooperation among policy-makers and integrate the concept of SCP into national and local multisectoral development plans.

The restaurants are encouraged to incorporate sustainability into their long-term goals, train and influence their staff to practice SCP and provide consumers with sustainable dining options.

For the consumers, they are urged to help spread awareness on the environmental impacts of the food-service industry, encourage

other diners to support sustainable dining, and uphold the practice of sustainable approaches in their daily lives.

Food lovers

Filipinos love to eat. T hey even seek the latest food trend in social-media platforms, dine out in search of delicious food to satisfy their craving for healthy and delicious food options, WWFPhilippines said.

This passion for food is slowly shifting back from fast food to slow food, said June M. Alvarez, executive director of the Philippine Center for Environmental Protection and Sustainable Development Inc. (PCEPSDI).

During the forum, A lvarez said members of the Generation Y, or the so-called millennials, are leading the way to this shift, with its choice of food that is healthier and produced in a much environment-friendly way.

“My colleagues in the office are millennials. Every time we have overtime, they request me to provide local food. They talk about local food,” he said.

While the trend of “going back to the basics” is happening, on a larger scale, problems of wasteful eating, as well as unsustainable dining, persist.

Citing various data, according to WWF, in the Philippines, 308,000 tons of rice go to waste every year.

Ironically, it also said 2.7 million Filipino families were reported as hungry in 2016.

Changing market behavior

The campaign intends to change the market behavior toward sustainability to address the problems caused by the current practice of Filipinos on food, their eating habits, choice of food and dining experience.

“We intend to change the behavior of the public in general toward food. If you are aware and you know what will be better for

Sinigang na baboy (Pork tamarind soup) Wikimedia Commons

everybody, you will demand [for] it. If there is demand for it, the industry will adjust demand for sustainability,” said Jose Angelito Palma, president and CEO of WWF-Philippines during a conference to highlight the event’s objectives.

He said the trend in sustainability is not just for the environment, but for the community and the different stakeholders.

Eco-labeling

Alvarez said the PCEPSDI, the administrator of the National Eco-labeling Programme-Green Choice Philippines, urged companies to seek accreditation to be labeled as an eco-friendly business establishment.

He said promoting SCP is not only about being environmentfriendly but is also helping businesses become more sustainable.

“Given our criteria, we can promote sustainability,” he said.

Eco-labeling promotes not only products but services, as well,” he added.

Climate change

A ssistant Sect a r y Rommel Antonio O. Cuenca, deputy executive director of the Climate C h a nge Com m i ssion, u nder scored the importance of reducing food wastage in the fight against climate change.

Citing a Food and Agriculture Organi zat ion repor t, Cuenca said one-third of annual food production go to waste.

“Connect that with how much

food go to waste and the carbon footprint of the agriculture sector. How much water is needed to produce the food we eat? Every food you waste impacts on the climate,” he added.

It is important to look at the demand and production sides to reduce food waste to help mitigate climate change, he said.

Green practices

Christopher Baylon, operations manager of Nurture Wellness Village, said sustainability should be integral into their business operations.

Reducing kitchen waste and proper disposal of waste is institutionalized in Nurture Wellness, he said.

“In our resort, we are doing sustainable practice. We have 30 [kilograms (kg)] to 40 kg of kitchen food waste a day,” to address the problem, they decided to practice waste segregation and composting.

Reducing waste, he said, actually saves them from the cost of the waste disposal alone. The resort reduces production costs and save money by using the recycled materials as decorations.

Going local

R aoul Roberto P. Goco, executive chef of Degustation Restaurant Group and a board member of the Hotel and Restaurant Association of the Philippines for the Restaurant Sector, said as a chef he makes it a point to use local ingredients that are organic

and seasonal.

“Before, you draw up your menu then go around and look for suppliers or importers. What I am doing now is I look at the market. I look at what’s available. From there, we taste the ingredients then make the menu,” he said.

He encourages hotel and restaurant chefs to be more creative and make use of local ingredients as opposed to using imported ones that are more expensive and hard to find. “ We h a v e b e aut i f u l p a t i s [fish sauce], bagoong [fermented small fish or shrimps], vegetables. We have pro-biotic chickens. It is about time for chefs to look and cook seasonal, and cook local using local ingredients, and experiment with new techniques on how to preserve or highlight anything.”

He added: “Cook our local cuisine. That is the only way we can be recognized by the world.

Tourists go for Filipino food and they deserve incredible Filipino food,” he said.

By using local ingredients, c hefs a l so he lp t he Fi l ipi no f a r me r s — t he u lt i m ate fo o d producers—to survive.

“I also hope we can teach farmers on modern sustainable techniques,” he said.

Growing trend

Jen Horn of Muni, a company t hat promotes events to encourage public behav ior in t he shopping , eating and trave l i ng tow a rd su st a i n a bi l it y,

Slow food vs fast food

Goco said 20 years ago, Filipinos cooked at home using local ingredients available in the market.

The tinola and other Filipino dishes, he said, are actually slow food, until fast food became a necessity as the Filipinos become too busy. It kept people away f rom cook ing at home, which is “unhealthy”.

“From the restaurant point of view, I tell my customers the health benefits and sumptuous dishes in slow-food preparation,” he said.

Against fast food, slow food is much healthier and delicious.

Even the local carinderia (eatery or roadside food stalls), Goco said, offer sumptuous meals because of the manner they were prepared and cooked.

He said the turo-turo (eatery), which uses local ingredients, traditional practices, as opposed to industrial techniques in cooking, is better and can be considered “slow food, served-fast” type of food service.

“If only we can make it sanitary, it’s the way to go, much better than eating in fast food which is industrial food,” he said.

Better option

Both the Filipino dining public and the players in the hotel and restaurant business have better options to help save the planet, according to WWF-Philippines.

“At the end of the day, sustainability makes good business sense,” Palma said.

Biodiversity Monday BusinessMirror

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Monday, October 9, 2017 A13

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

DENR to probe ‘shrinking’ turtle islands in Tawi-Tawi

T

h e Depar tment of Environment and Natural Resources (DENR) will look into the shrinking of islands comprising the Turtle Islands Wildlife S anc tuar y ( TIWS), S outheast A sia’s largest marine-turtle sanctuary, in the municipality of Turtle Islands in TawiTawi province.

Director Theresa Mundita S. Lim of the Department of Environment and Natural Resources-Biodiversit y Management Bureau (DENR-BMB), said the “shrinking” of five islands in Tawi-Tawi needs further verification in her reaction to reports of the bureau’s conservation experts working under the Pawikan Conservation Project (PCP). The group of islands, namely, Boan, Lihiman, Langaan, Great Bakkungan, Taganak and Baguan, has a total aggregate area of 241,495.92 hectares, of which 298.27 hectares correspond to the land portions of the sanctuary, according to information provided by the Philippines to the United Nations Educational, Scientific and Cultural Organization (Unesco).

The smallest island, the Langaan, measures about 7 hectares, while the largest, the Taganak Island, is about 124 hectares. Taganak Island is now thickly populated, with some residents living on beaches, which used to be nesting sites of the green marine turtles.

“We need to know if this [shrinking] is caused by natural sand shifting or as a result of sea-level rise,” Lim told the B usiness M irror in a telephone interview.

Sand shifting is a natural phenomenon.

Beaches change shape as influenced by tides and ocean currents. This could also lead to the shrinking or expansion of islands.

Sea-level rise, on the other hand, is predic ted to occur as a result of the melting of the ice cap because of increasing global temperature. Known to nest and lay their eggs on beaches, both phenomenon can aggravate the already dwindling population

of marine tur tles and hasten their ex tinc tion. Based on satellite images taken in 1987, comparing it to the image captured last year, the islands’ beaches have shrunk considerably.

The Baguan Island reportedly shrank by as much as 5 hectares, said Rizza Araceli Salinas during the “Seminar on Marine Turtle Conservation Science” held at the DENRBMB Training Center at the Ninoy Aquino Parks and Wildlife Center in Quezon City on September 19.

Salinas expressed alarm, considering that the islands are the nesting sites of marine turtles, particularly the green marine turtles. The TIWS was proclaimed as Wildlife Sanctuary under Proclamation 171 on August 26, 1999, and identified as extremely high for biodiversity conservation, according to the Unesco web site. “[The TIWS is] the only major nesting habitat of green sea tur tles in the Philippines and the only major nesting ground in the whole Asean region and the 11th major nesting site in the world,” the web site added.

Lim said the DENR-BMB would have to coordinate and seek the help of other concerned government agencies to come up with a science-based conclusion on the shrinking of the islands.

“We have to consult experts and again capture satellite images. We will need the help of the Department of Science and Technology and the National Mapping and Resource Information Authority,” Lim said.

Hunted for their meat, eggs and shells, the global population of the marine tur tles is dwindling. Besides illegal wildlife trade, accidental bycatch is a serious problem. The DENR’s marine turtle conservation program was established in 1979 as part of its effort to save the species from extinction. There are five known species of marine turtles in the Philippines, foremost of which is the green marine turtle. Jonathan L. Mayuga

Helping save marine life through artificial reefs

Thirty artificial reefs built by Phoenix Petroleum employees and volunteers from the Philippine Coast Guard and Philippine Coast Guard Auxiliary were laid recently in marine-protected areas in Davao City.

P

hoenix Petroleum Philippines Inc., led by its corporate social responsibility arm, Phoenix Philippines Foundation, laid ar tificial reefs in Davao City on September 30.

Company officials and employees, together with volunteers from the Philippine Coast Guard and the Philippine Coast Guard Auxiliary, built 30 artificial reefs at Phoenix Petroleum’s headquarters in Davao City. Each reef measured 110 centimeters x 70 cm and were built using corrugated round bars, wire mesh, lime sand and cement.

The structure of the reefs were made for a sturdy and suitable home for pelagic fish, giving them protection and allowing them to breed and grow their number.

The reefs were laid in marine-protected areas in Barangay Vicente Hizon in Lanang

and in Barangay Centro Jerome in Agdao, both in Davao City.

The seabeds in these locations are protected by barangay ordinances and the Barangay Bantay Dagat, as well as coast guards; thus, are kept safe from illegal fishing and destructive marine practices.

“Taking care of the environment is one of the primary advocacies of the Phoenix Philippines Foundation, and this new projec t contributes to our efforts of saving our planet,” Phoenix Petroleum Vice President for External Affairs Raymond Zorrilla said.

Phoenix Petroleum also engaged in coastal cleanup activities around the country in September in celebration of International Coastal Cleanup Day, and as part of its efforts of preserving the environment for future generations.

Sarangani posts record sighting of raptors

D

By Manuel T. Cayon | Mindanao Bureau Chief

AVAO CITY—Scientists on migratory-bird monitoring have validated a report of a government conservation center in Sarangani that, indeed, lying along the migratory and roosting path of migratory birds from cooler northern regions of Asia, are as many as 86,000 raptors alone from mainland Asia.

grey-faced buzzard Wikimedia Commons

In one day alone, on September 29, a team from the Environmental Conservation and Protection Center (ECPC) counted 54,000 raptors in the routine daylong watch from a promontory, called Raptor Hill, in Barangay Rio del Pilar in Glan, Sarangani, the information office of the province said. The place is 200 kilometers south of here.

T he ECPC was conduct ing t h i s yea r ’s m ig rator y-raptor study as the season of bird migration has began. The birds avoid the cold autumn season in cooler parts of the world. The team was assisted by personnel from the Sarangani Information Office and village volunteers.

“It appears that the peak season is here. Today, our team at the Raptor Hill counted around 54,000 Chinese sparrowhawks,” said lawyer Emma Nebran, former executive director of ECPC. “Like clock, the raptors are back.”

Serafin Ramos Jr., Sarangani chief information officer who went with the team, said when the observation entered its two weeks into the watch, “the Sarangani Team has recorded 86,000 raptors, a record-breaking count compared to last year’s 78,817 over five weeks of a confirmatory raptor migration study.”

The birds are looking for thermal air currents, which can be found on Mount Latian Complex, the possible roosting site of such raptors, the team said.

Mount Latian Complex has been identified as one of the important biodiversity areas in the Philippines. In 2002 it was declared by the Department of Environment and Natural Resources as Philippine Biodiversity Conservation priority. Raptor Hill is part of the complex. The presence of migratory birds in Glan was first discovered in 2014, Ramos said, quoting Nebran.

Some residents around Raptor Hill have noticed a “thick flock of birds covering the sun, flying together,” Nebran added. “ The autumn raptor migration study in Sarangani Province was first conducted in 2014 by A lex Tiongco and Maria Teresa

86,000

The estimated number of raptors from mainland Asia that were sighted in Sarangani for two weeks recently

Cervero, who reported that Sarangani is very likely a major migration route in autumn for raptors crossing from the Philippines to Indonesia,” Nebran said.

He added: “To validate the report, the provincial government of Sarangani through the ECPC and Raptorwatch Network Philippines conducted last year the autumn raptor migration study from September 15 to October 23 in Glan. The study wanted to establish a database of species, numbers and routes of migrating raptors and locate roosting sites.”

“A total of 78,817 migratory raptors composing of seven species were counted. The study proved that Sarangani Province is indeed a major autumn migration route for raptors crossing from the Philippines to Indonesia,” Nearby said.

For 2017, the autumn raptor migration study was started on September 18 and would last up to October 31 in and around Raptor Hill, Ramos said.

“Researchers from the Japanese Society for the Conservation of Birds are expected to join the Sarangani Team,” Nebran added.

The monthlong study aimed to promote coordinated actions to achieve and maintain the favorable conservation status of migratory raptors; to protect these migratory species along their flyways and to identify their important habitats, roosting sites and favored routes; and to produce a relevant research.

In last year’s study, Ramos said the Raptorwatch Network and the Sarangani Team conducted a confirmatory raptor migration study in from September 15 to October 22.

crested honey buzzard Wikimedia Commons

The team conducted site reconnaissance for the arrival of the migratory birds of prey as they approach the Philippines in September and October to warm up and look for roosting sites after leaving Taiwan.

Filipino scientists said migration of the raptors “is a particularly sensitive indicator of environmental health, which would draw the interest of tourists and wildlife enthusiasts. Conducting long-term counts of migrating raptors can help in the study of their migration patterns, behaviors and populations.”

The raptors arrive in Sarangani twice a year; September to October and March to April, their return flight. Raptors are characterized by their sharp vision that allows them to detect prey during flight.

They usually feed on rats and insects. Thus, they serve as natural pest control in the area.

Studies and in-depth monitoring have been done in Indonesia and Taiwan. Quoting the team, Ramos said one theory “states that Sarangani might be their exit point going to Indonesia and could be the major f lyway.”

A n ea rl ier st udy, “ P rojec t Southern Crossing 2014: First observations of autumn raptor migration at Sarangani, Mindanao, Philippines,” by Tiongco and Cer vero, Adrian M. Constantino and Maria Katrina C. Constantino, described the Philippines as an “ important link in the East Asia-Australasian Flyway, a migration route involving long sea crossings,” BirdLife International 2015 said.

According to the study, in autumn and spring, thousands of raptors pass through the Philippines; some are believed to winter in the country.

“In aut u mn, t he bird s f ly south from the Palearctic breeding areas, passing across southeast China and Taiwan before arriving on Luzon en route to wintering areas further south,” the 2014 study said.

The Raptor Study Group (RSG) has made exploratory expeditions to map the migratory routes through the country, including entry and exit points.

“During the 2014 autumn migration, the RSG decided to work in the Davao del Sur and Sarangani area,” the study said.

“Initial obser vations in [Barangay] Cross [adjacent to Barangay R io del Pilar] revealed a pa ssa ge of m ig ra nt s f rom Mount Gulo and nearby roosting areas with the vantage point directly below the migration path,” it added.

In all, nine raptor species were seen dur ing the watch, si x mig rants and three residents. The migrant species seen were ( Western) osprey (eight), c rested hone y bu z z a rd (14), Chinese sparrowhawk (47,307), Japanese sparrowhawk (two), g rey-faced bu zza rd(242) a nd peregrine falcon (two).

Resident spec ies obser ved were Philippine serpent eagle (five), South Philippine (Pins k e r ’s) h aw k- e a g le (28) a nd Brahminy kite (60). Unidentified falcons (four) and other raptors (six) were also observed.

T he C hinese spa r rowhawk was the predominant species, comprising 99 percent of the raptors observed T he st udy sug gested t h at Sarangani “ is ver y likely to be a major migration route in autumn for raptors crossing from the Philippines to Sulawesi,” R amos said.

A14 Monday, October 9, 2017 • Editor: Angel R. Calso

Opinion BusinessMirror

editorial

PHL terror ties just got worse

G

lobal news headlines have been filled this past week with the fact that Las Vegas mass murderer Stephen Paddock had been living with Philippine-born girlfriend Marilou Danley. Paddock had been to the Philippines at least on two occasions, seen in photographs presumably with Danley’s family and friends.

The revelations that Paddock recently wired $100,000 to the Philippines, and police reports that he had intended to survive the shooting and escape, open new questions. Was it his intention to flee to the Philippines if he had eluded capture?

On the heels of this comes more disturbing news found in the headline of the US news and opinion web site The Daily Caller: “NYC ISIS Suspect: Philippines Is A ‘Breeding Ground For Terrorists”.

The US Federal Bureau of Investigation released information on the criminal charges filed against three men who planned to attack concerts at Times Square and crowded subways in 2016 in an Islamic State of Iraq and Syria (ISIS)-inspired attack that one of the suspects said he hoped would be “the next 9/11”. All had been previously charged and arrested in connection with other terrorist plots.

In this latest unsealing of the Federal criminal indictment, The New York Post reported, “In the spring of 2016, Abdulrahman El Bahnasawy, a 19-year-old Canadian, and Talha Haroon began planning the attack over messaging apps with the undercover posing as an ISIS supporter, according to the newly unsealed complaint.

They were getting help from Russell Salic, a 37-year-old living in the Philippines who wired money to the US to fund the attack, the papers said.”

The National Bureau of Investigation arrested Dr. Rusell Langi Salic on four counts of kidnapping and two counts of murder in April on charges that he was part of the group of armed men who abducted and subsequently beheaded Jaymart Capangpangan and Salvador Janubas. Salic has been also linked the Maute Group. In addition to charges in the Philippines, Salic is awaiting extradition to the United States.

Salic, in messages to the other alleged conspirators, said he could send money from the Philippines to support terror. These messages should be a cause for great concern.

In one message he writes: “It’s not strict here. Unlike in Aus [Australia] or Uk [the United Kingdom] even liking FB [Facebook] status will put you in jail...Terrorists from all over the world usually come here as a breeding ground for terrorists...hahahaha.... But no worry here in Philippines. They don’t care bout IS [ISIS]...lol. Only in west”.

The Philippines as a “breeding ground for terrorists” is not an empty phrase. This problem with roots going back to the administration of Gloria Macapagal-Arroyo festered and grew during the presidency of Benigno S. Aquino III. It must be taken with equal seriousness and priority as our domestic terrorism and insurgency concerns.

While the government moves for more autonomy as embodied in the Bangsamoro basic law, it had better make absolutely sure that this initiative cannot and will not be used to further global acts of terrorism. Any thought in other nations that the Philippine government is in any way “soft” on terrorists must be countered with strong action and not simply strong words. The world is watching.

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Still on fake news Atty. Jose Ferdinand M. Rojas II

RISING SUN

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ne of the hottest topics these days is the issue on fake news. This has taken such a prominent position on everyone’s radar because of technological advances and the ease with which people can spread information around. And because almost everyone can do that, it is very difficult to control the content and quality of things that get shared. It seems that there are people who only want to enjoy the conveniences but not the responsibilities that come with this freedom.

Things get particularly dangerous when a netizen is considered an online celebrity, with thousands of followers all over the world who could read and share anything that this personality would post. It is only natural for online personalities—or any netizen for that matter—to be expected to behave properly, observing fairness, responsibility and

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maturity in all of his/her online activities. This is not the sole responsibility of journalists. Everybody is being called to be accountable, with awareness about how the Internet works and the repercussions of every action and every word.

A possible solution—legislation—may be a double-edged sword because, while it may push some

H

ouse Bill (HB) 6517, otherwise known as the “Philippine Compassionate Medical Cannabis Act”, was unanimously endorsed by the House Committee on Health on October 2. Originally authored by Rep. Rodolfo T. Albano III of the First District, Isabela, the bill seeks to legalize and regulate the medical use of cannabis, which has been confirmed to have beneficial and therapeutic uses to treat chronic or debilitating medical conditions. “‘Cannabis’ refers to every kind, class, genus, specie of the plant Cannabis Sativa I., Cannabis americana, hashish, bhang, guaza, churris, garjab and embraces every kind, class and character of marijuana, whether dried or fresh and flowering, flowering or fruiting tops or any part or portion of the plant and seeds thereof, and all its geographic varieties, whether as a reefer, resin, extract, tincture or in any form whatsoever” (Section 3[a]). “‘Medical cannabis’ refers to the use of cannabis, including its constituents, tetrahydrocannabinol [THC], and other cannabinoids, as a physician-recommended form of medicine or herbal therapy. Medical cannabis shall not be used in its raw form” (Section 3[f]). “‘Debilitating medical condition’

refers to any disease that produces one or more of the following: cachexia or wasting syndrome; severe and chronic pain; severe nausea; seizures, including those characteristic of epilepsy; or severe and persistent muscle spasms, including those associated with multiple sclerosis. Debilitating medical conditions include the following diseases: (1) cancer; (2) glaucoma; (3) multiple sclerosis; (4) damage to the nervous system of the spinal cord, with objective neurological indication of intractable spasticity; (5) epilepsy; (6) positive status for human immunodeficiency virus or acquired immune deficiency syndrome; (7) post-traumatic stress disorder; (8) rheumatoid arthritis or similar chronic autoimmune inflammatory disorders; or (9) Diseases requiring admission

people to be more careful, it could also be considered as a form of censorship and affect even those who are not guilty of spreading fake news. As it is, fake news has gained so much power with its ability “to sway public opinion, shape civic discourse, affect social interaction and influence [the] government.” This was the statement of Sen. Grace Poe, the chairman of the Senate committee on public information and mass media.

Gone are the days when writers— whether from the media, academe, etc.—would go to great lengths to verify sources, confirm information, do extensive research before publishing any piece of information for the public. The integrity, moral ascendency and accountability of these writers are truly admirable. And this is something that many, if not most, of our younger writers these days must try to emulate. Whether one is a blogger, newspaper or magazine writer, television reporter, online news media member, the standards are the same. The writing profession is best taken within the context of

Both existing international and national laws provide for the use of cannabis for medical purposes.

The Single Convention on Narcotic Drugs in 1961, as amended by the 1972 Protocol, provides in its Preamble: “Recognizing that the medical use of narcotic drugs continues to be indispensable for the relief of pain and suffering and that adequate provisions must be made to ensure the availability of narcotic drugs for such purposes.” into hospice care; and (10) any other debilitating medical condition or its treatment that is subsequently identified by the Department of Health [DOH] as recommended by a panel of doctors constituted for this purpose” (Section 3[c]). “‘Medical use’ refers to delivery, possession, transfer, transportation or use of cannabis and its devices to treat or alleviate a registered qualified patient’s medical condition or symptoms associated with the patient’s debilitating disease or its acquisition, administration, cultivation or manufacturing for medical purposes” (Section 3[g]). “‘Qualified Medical Cannabis Patient’ means a person who has been diagnosed by a certifying physician with bona fide relationship with the patient as having a debilitating medical condition and who, in the physician’s professional evaluation,

responsibility and the realities that surround social media and the global Internet community. nnn

ON September 16 the Philippine Charity Sweepstakes Office (PCSO) Special Maiden Race was held at the Metro Manila Turf Club Inc. in Malvar, Batangas. Congratulations to the following winners: (1) Talitha Koum (RG Fernandez); (2) Victorious Colt (JB Guce); (3) Royal Signal (KB Abobo)!

A few days later, on September 29, the PCSO Special Maiden Race 2-Year Old Open was held, with the following results. First place were Speedmatic (MM Gonzales), Xia’s Best (JAA Guce) and Near and Dear (CP Henson). On second place were No Regret (KB Abobo) and Sweet Dreams (Val R. Dilema). And, finally, landing on third were Sheltex Magic (Pat R. Dilema) and Exaggeration (RG Fernandez). They were followed by Sunshot (VM Camanero) and Baywatch (JB Cordova), respectively. Congratulations to all of the finishers!

should receive therapeutic or palliative benefits from the medical use of cannabis.

HB 6517 further seeks to establish Medical Cannabis Compassionate Centers licensed by the DOH based in DOH-retained hospitals, specialty hospitals and private tertiary hospitals, which can sell, supply and dispense cannabis to qualified patients or their caregivers through a pharmacist with an S3 license issued by the Philippine Drug Enforcement Agency (PDEA). It also provides for the creation of Medical Cannabis Research and Safety Compliance Facilities (MCRSCFs) licensed by the DOH to conduct scientific and medical research on the medical use of cannabis and provides testing services for its potency and contaminants. A registered MCRSCF shall cultivate or test cannabis in an enclosed, locked location at the physical address provided during the regulation process, which can only be accessed by their employees or agents.

Qualified medical patients will be issued identification cards by the DOH after they are certified by physicians with whom they have a bona fide relationship as having debilitating medical condition and should receive therapeutic or palliative benefits from the medical use of cannabis. The DOH will provide training for medical cannabis physicians.

The DOH, in consultation with See “Kapunan,” A15

Opinion BusinessMirror

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Liar, liar

PPP conversations #10 with Metro Pacific Tollways Corp.

By Alberto Agra

Siegfred Bueno Mison, Esq.

PPP Lead

THE PATRIOT

F

reedom of expression or the right to free speech is one of the more enshrined rights protected in most democracies.

While the Philippine Constitution admits a few exceptions to this free speech, such as obscenity or pornography, there has been a rampant circulation of insulting or “fighting words”, libelous statements and some fake news, which have the tendency to destabilize society. Authors of these words and fake news come from all sectors—from powerful politicians to paid bloggers. Without extensive comprehension of real issues, ordinary recipients may begin believing what are essentially lies.

A simple “Like” or share on social media may even have its own harms.

I am not fully aware of the developments in the new cybercrime law in the Philippines, but I would not be surprised if subscribing to fake news will lead to criminal liability. The simple act of clicking—and doing so without critical thinking—helps spread the lie.

In certain organizations or cults, gifted speakers have fooled many followers to simply listen and act without discernment. History tells us how a charismatic Adolf Hitler, ably assisted by master propagandist Paul Joseph Goebbels, managed to win the trust of countless of Germans prior to World War II. We must not blindly agree to take the word of leaders who impose their standards on their followers. The simple act of irresponsible idolizing helps circulate the false and immoral beliefs.

Whenever text messages go unanswered, some people use the flimsy excuse of “bad connection” or “not getting it”. While our Internet connection and telecommunications service can be bad; it can’t be that bad—all the time! Unfortunately, for such liars with lame excuses, technology today allows for the “read” or “sent” receipt to be seen. The simple excuse of bad service helps form the habit of lying.

In Psalms 12:1-2, the Bible says, “Help, Lord, for no one is faithful anymore; those who are loyal have vanished from the human race. Everyone lies to their neighbor; they flatter with their lips but harbor deception in their hearts.” As the verse implies, the attributes of a good liar are “flattering lips” and a “double heart”. To flatter is to gratify with much insincerity. Those gifted with flattering lips say what others want to hear; they are those who know the right answer for every occasion, without necessarily speaking the truth.

Famous English writer and preacher Thomas Adams once said, “A man without a heart is a wonder, but a man with two hearts is a monster.” A person with a double heart is one whose one heart speaks the words the world wants to hear while the other harbors his true feelings.

And there have been quite a few monsters in our midst here in the Philippines under the guise of exercising free speech. While I can name a few, invoking my freedom of expression, I prefer not to. After all, one by one,

Kapunan. . .

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the Food and Drug Administration, shall be the principal regulatory agency. The PDEA shall have a key role in monitoring and regulating the dispensation of medical cannabis in health facilities.

The use of cannabis for medical purposes is provided for by both existing international and national law. The Single Convention on Narcotic Drugs, 1961, as amended by the 1972 Protocol, provides in its Preamble: “Recognizing that the medical use of narcotic drugs continues to be indispensable for the relief of pain and suffering and that adequate provisions must be made to ensure the availability of narcotic drugs for such purposes.” On the other hand, the Dangerous Drugs Act of 2002 recognizes the medical

Monday, October 9, 2017 A15

Gifted speakers have fooled many followers to simply listen and act without discernment. History tells us how a charismatic Hitler, ably assisted by master propagandist Goebbels, managed to win the trust of countless Germans prior to World War II. We must not blindly agree to take the word of leaders who impose their standards on their followers. they are slowly exposed.

In legal proceedings, witnesses are required to take an oath, which, among others, imposes the duty of telling the truth and nothing but the truth. In the Philippine Military Academy, cadets observe the Honor Code, which, among others, imposes the duty of not lying or tolerating others who do so. But despite all of these codes and oaths, there are still a few who display flattering lips and a double heart. I personally find it disconcerting every time I hear academy graduates get involved in activities of dishonor.

Fortunately, there is one who is incapable of lying. In Hebrews 6:18, it has been said that by virtue of his oath and promise, it is impossible for God to lie. While the Bible is subject to many interpretations, there are absolute truths that have passed the scrutiny of criticism, doubts and revelations from scientists and philosophers. Only with inspired minds with the aid of the Spirit within us can we come to understand that the Bible does contain the truth. Words of the Bible, of the President, of anonymous propagandists, or of anyone spreading news, fake or otherwise, are valuable and effective only up to the extent as to how the recipient will react to them. Liars think they can get away with their deceit. They can get away with lies only when we allow them to pollute our minds. We just have to remember that no secrets remain unrevealed and, more importantly, as in Luke 8:17 tells us, “for nothing is hidden that shall not become evident, nor anything secret that shall not be known and come to light”. No amount of lies can affect those who think before they click, those who discern before they subscribe, and those who remain faithful to His Word.

For questions and comments, please e-mail me at sbmison@gmail.com.

use of drugs classified as dangerous drugs, including marijuana, when it provides in Section 2; “The government shall, however, aim to achieve a balance in the national drug-control program so that people with legitimate medical needs are not prevented from being treated with adequate amounts of appropriate medications, which include the use of dangerous drugs.” (Explanatory Note, HB 180) HB 6517 further provides the penalty of a fine of P50,000 to P100,000 or higher at the discretion of the Court and imprisonment of six to 12 years for use of cannabis for purposes other than treatment of a debilitating medical condition.

President Duterte’s anti-illegal drugs campaign prohibits the use of all forms of illegal drugs, including marijuana. HB 6517 provides a legal loophole to the use of marijuana— just call it medicine!

Continued from A1

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etro Pacific Tollways Corp.(MPTC) has done and continues to operate over 200 kilometers of road PPPs in North Luzon Expressway (Nlex) and Cavite Expressway (Cavitex) and will soon complete three more—Cavite–Laguna Expressway (Calax), Nlex-South Luzon Expressway (Slex) connector road and Cebu-Cordova link expressway.

MPTC President and CEO Rodrigo Franco shares his insights on the need for resource exchange, the readiness of the government and the private sector to enter into such collaborative arrangements, and the successes and risks of PPPs. He calls on us to support and be patient with this alternative development strategy. Thank you MPTC for keeping the PPP flame burning. n What is your concept of PPP? PPP is a joint endeavor of the government and private entities to

deliver essential services, especially infrastructure, to the public. As its resources and capabilities are never enough, the government through the PPP Program contracts privatesector entities to help deliver basic services. The government and its private-sector partner share the risks and rewards of the endeavor.

The private entity generates returns from a stream of payments either from the government or the recipient of the services. n What makes PPP a viable and preferred development

The aspirants Joel L. Tan-Torres

DEBIT CREDIT

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ver 15,000 trooped to the various testing venues throughout the Philippines on October 7 to take part in a very important and long-running tradition. For four days, these aspiring individuals will attempt to hurdle the strict requirements of the exclusive institution that they seek to be a part of.

They have long strived in their learning preparation (some of them taking more than seven years) to start this process of admission.

And now, these aspirants are (hopefully) ready. They have started the process of taking the professional licensure examination for Certified Public Accountants (CPA). These qualification examinations consist of six subjects of financial accounting theory and reporting, auditing, advanced financial accounting and reporting, regulatory framework for

business transactions, taxation and management services.

Not too many of them will make the grade. Over the past years, only about 35 percent to 41 percent pass the licensure examinations given by the Board of Accountancy (BOA). The BOA has been administering the CPA Board Examinations since 1923, and since then, after 94 years, over 180,000 Filipinos have become CPAs. To the aspiring CPAs, I would like to give some words of advice.

strategy? What PPP projects have your company done, or plan to engage in?

The PPP is a preferred development strategy as it leverages the combined resources and skills of the private- and public-sector partners. The partners work together and share the risks and rewards.

Our company, MPTC, has already implemented several toll road PPPs, including Nlex and Cavitex. Among the other projects that are currently under development through the PPP Program are Calax, the NlexSlex Connector Road and the CebuCordova Link Expressway. n Is your company ready for PPPs? Why? Is the government ready?

Our company is fully geared for PPPs, especially in the toll-road sector. We are currently the leading toll-road developer and operator in the Philippines with over 200 kilometer of tollways in operations. We have learned a lot from the development and operation of Nlex, Subic-Clark-Tarlac Expressway and Cavitex. We have highly engaged personnel who have the skills, experience and motivation to deliver PPP projects. The Philippine government is among the

more experienced implementors of the PPP scheme. n What are the challenges and risks of PPPs? The main risk of PPPs in the Philippines is the unstable commitment of the public sector to adhere to the terms of PPP contracts. There have been several cases of the government partner unilaterally reneging on its obligations under the PPP Program.

In the toll-road sectors, there are also significant risks like right-ofway availability. These risks often result in delays in the development of the project. n What is your message to the public?

I urge the public to be patient with PPP projects. While PPP endeavors generally entail payment of fees for basic services provided by privatesector operators, the program allows a more efficient allocation of resources. The PPP Program enables the government to focus on the development projects that are badly needed but less appealing to private investors. On the other side, the private entity uses its skills and resources to enhance the quality of its service in order to generate a stream of payments from its customers or government partner.

You have long prepared for this test. Your exhaustive preparation should give you the confidence that you have acquired sufficient knowledge to hurdle your challenge of doing good in the examinations. You do not need to be a master of all the accounting literature that is out there. You merely should know the fundamental principles and concepts that will guide you in the various situations that you will encounter in the examinations.

So many people are behind you on your endeavor. Be inspired that your loved ones, who have been with you all these years, simply wish that you do good in your pursuit to enter the CPA profession. Doing good is not necessarily excelling in all the tests, but rather, being able to say that you were able to do your best.

Unnecessary pressure and tension can be avoided and should be avoided. One way of handling this is realizing that these negative emotions are fleeting episodes that should not disrupt your positive

mind-set; that you are equipped to successfully complete your challenges.

And, finally, pray to your God, Allah or any other name that you call your Supreme Being, to ask that aspiration will be fulfilled. With the intercession of our Divine Providence, nothing is impossible.

I like to end by citing a quotation of Jaachynma Agu, the author of The Prince and the Pauper: “Your status has changed. Your name is changed!

You are a new creation.”

To the aspirants, I wish you the best on your quest of creating yourself to become a proud CPA. Chairman Joel L. Tan-Torres is the chairman of the Professional Regulatory Board of Accountancy.

He is a Certified Public Accountant who placed No. 1 in the May 1979 CPA Board Examinations. He is currently on leave as a partner of Reyes Tacandong & Co., CPAs. He was the former commissioner of the Bureau of Internal Revenue from 2009 to 2010.

This column accepts contributions from accountants, especially articles that are of interest to the accountancy profession, in particular, and to the business community, in general. These can be e-mailed to boa.secretariat.@gmail.com.

A people’s choice guide to the economics Nobel

By Cass R. Sunstein Bloomberg View

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ecause economics is such a diverse field, with many distinguished thinkers, predicting the winner of the Nobel Prize in economics is notoriously difficult. But suppose that we narrowed the field, so as to focus on candidates who have not only made important theoretical contributions, but have also had a significant impact on the world, and affected the lives of numerous people?

If that is the standard, here are some leading contenders for the prize, which is to be announced on Monday: Esther Duflo, Massachusetts Institute of Technology. Governments are keenly interested in the actual effects of their interventions, but they often lack tools to establish what works and what doesn’t. Building on work in medicine and related fields, Duflo has pioneered the use of randomized controlled trials. One group of people serve as a control; another group, otherwise identical, is subjected to a policy intervention, designed to reduce disease, increase access to loans, reduce poverty or improve education. If the trials are done properly, they can be used to isolate the actual effects of the intervention.

That’s huge progress.

In recent work, Duflo argues that an economist can be a plumber: “She installs the machine in the real world, carefully watches what happens, and then tinkers as needed.” Focusing on poverty and development, Duflo’s own randomized controlled trials are not only providing invaluable information to policy-makers; they are also getting help to many people who need it.

Richard Posner, University of Chicago. Recently retired from the federal bench, Posner is the leading thinker behind the field of law and economics, which tries to analyze legal rules with the help of economic tools.

Suppose that a local government imposes a rent-control law, or that a state court strikes down certain contracts as “unconscionable” because they are unfair to poor people. What are the likely effects? Whether the issue involves occupational safety, automobile accidents, antitrust law, consumer protection or the role of private property, public officials, lawyers and judges are now using the methods that Posner helped introduce.

(If Posner gets the Nobel, a strong corecipient would be Judge Guido Calabresi, who also did pioneering work.)

William Nordhaus, Yale University. The problem of climate change raises unusually difficult problems for economists, not least because of high levels of uncertainty about the likely effects, tough questions about how to turn those effects into monetary equivalents, and serious challenges, at the intersection of economics and philosophy, about how to deal with harm to future generations. More than anyone else, Nordhaus has produced disciplined, rigorous and luminously clear thinking about all of these questions, in a way that is transparent about underlying assumptions and that makes real progress on, and possibly even solves, some seemingly intractable problems.

Nordhaus’s work played a defining role in the efforts of the US to produce a “social cost of carbon”, which, in turn, influenced many regulatory initiatives both here and abroad. (If Nordhaus gets the Nobel, a strong corecipient would be

Harvard’s Martin Weitzman, who has done pioneering work on how to think about risks of catastrophe, with special reference to climate change.)

W. Kip Viscusi, Vanderbilt University. Viscusi is rarely listed among Nobel candidates, but his work on the monetary valuation of risks to life and health has had a massive effect. In the US alone, it plays a major role in the work of the Environmental Protection Agency, the Department of Transportation, the Department of Energy, the Department of Labor and the Department of Health and Human Services.

These agencies and many others build on Viscusi’s work on the “value of a statistical life”. Viscusi does not really ask what a life is worth; he is interested in the value of statistical risks. If, for example, workers face a mortality risk of 1 in 100,000, how much compensation do they get in return? Suppose that the best answer is in the vicinity of $90. With a little multiplication, that produces a $9-million value for a statistical life— roughly Viscusi’s own figure, which is, not coincidentally, the value now used by most agencies of the US government.

Richard H. Thaler, University of Chicago. Over recent decades, the rise of behavioral economics has been the most interesting development in economic theory. More than anyone else, Thaler has been responsible for that development.

He has shown that in concrete ways, people do not act as predicted by standard economic theory. Far from seeing money as fungible, people put their cash in separate “mental accounts” (mortgage money, vacation money, retirement money). Investors overreact to unexpected news events. Human beings care about fairness—and they are willing to pay

something to punish people who have been unfair. People are planners, as well as doers, and when they are planning, they might try to foil their own doing (as, for example, by keeping high-calorie foods out of the house).

It’s true that with respect to Thaler, I’m biased. He’s a friend, as well as a coauthor. But no one can doubt that his influence can be seen in the work of governments all over the world, as officials use his findings to increase retirement savings, cut poverty, boost employment, increase safety on the highways and improve health. (Thaler is the pioneer, but worthy corecipients would be Colin Camerer of the California Institute of Technology, Ernst Fehr of the University of Zurich, George Loewenstein of Carnegie Mellon University and Matthew Rabin of Harvard.)

Economics is called “the dismal science”, and since the Great Recession, the field has taken a beating in the public eye.

Sure, some of the research of those listed here has produced dismal news—but it has also helped make the world a much better place.

DIPLOMASIA Ricardo Saludo Ricardo Saludo is on leave. We will resume publishing his column shortly.

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www.businessmirror.com.ph

Repeal of Marcos-era decree on payment of travel tax sought

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By Lorenz S. Marasigan

@lorenzmarasigan

NHANCING outbound air traffic from the Philippines will require the government to provide incentives to airlines, at least according to an executive of a local budget carrier, including waiving of fees that discourage passengers from flying to other countries.

Dexter M. Comendador, who sits as chief executive at Philippines AirAsia, said his group has

asked the government to waive airport terminal fees and travel taxes from developing air hubs

₧1,620 The travel tax being paid by outbound passengers to the government

to stimulate outbound traffic in airports outside Manila.

He said his airline is now in talks with the transportation, trade, finance and tourism departments, as well as the Civil Aviation Authority of the Philippines (Caap) and the Tourism Infrastructure and

Enterprise Zone Authority (Tieza), for the said proposal.

“I keep on asking the government to give us incentives. One is the airport fee, which is about P500. We are asking Caap to give us the airport fees for free for up to five years because it will lessen our operations cost,” he said in an interview.

Airport fees are paid by passengers to the government for the maintenance of the terminals they are departing from.

“We asked also the Department of Tourism to remove the Tieza fee of P1,620 to stir up outbound traffic, because increasing inbound traffic is easy,” Comendador said.

According to AirAsia’s study,

Duterte asked to pick Año’s replacement from 4 names

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he said, referring to Transportation Secretary Arthur P. Tugade.

Other government agencies, he added, seemed to be fine with the idea, but noted that waiving such fees will be against the law. AirAsia has since asked Sen. Franklin M. Drilon to initiate a Senate hearing on the said proposal.

The Philippines started charging the P1,620 travel tax from individuals leaving the Philippines in 1977, when then-President Ferdinand E. Marcos issued Presidential Decree 1183 “in order to provide adequate funds for the government programs”.

“Once the traffic has been stirred up in other hubs, Manila will be decongested,” Comendador said.

TO EASE TRAFFIC, MALL OWNERS AGREE TO NEW OPERATING HOURS

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AÑO: “All of them are qualified to be the chief of staff.

They have the seniority, they have the experience, they have what we say leadership material.” rmed Forces Chief of Staff Gen. Eduardo Año said last Sunday that four names of senior military officers, all with the rank of lieutenant general, have been submitted to President Duterte for him to choose from as the next top military chief.

Año said the names were submitted to the Commander in Chief last week by the military’s Board of Generals, which is also headed by the chief of staff.

Año is set to retire on October 26, his self-imposed deadline for the military to clear Marawi City of terrorists, who have been battling the government since May 23. While Año confirmed the submission of the list to the Commander in Chief, he, however, refused to name the three generals. Sources said included on the list was Lt. Gen. Carlito Galvez, commander of the Western Mindanao Command.

“All of them are qualified to be the chief of staff. They have the seniority, they have the experience, they have what we say leadership material,” the chief of staff said. “They are senior leaders who have risen to the ranks, and they are well respected. Whoever the President chooses, the Armed Forces will be good, we will be in good hands,” he added.

While Galvez, member of the Philippine Military Academy Class of 1985, is on the list, some officers doubted whether he could lead the military, owing to his previous record.

Galvez is the senior military officer who, as the government’s representative to the Coordinating Committee on the Cessation of Hostilities (CCCH) with the Moro Islamic Liberation Front (MILF) in 2015, failed to prevent the massacre of 44 Special Action Force in Mamasapano, Maguindanao.

The Philippine National Police has claimed that, at the time members of the MILF and the Bangamoro Islamic Liberation Front were mowing down the police commandos out on a counterterrorism mission, it pleaded with Galvez to ask the MILF leadership to order its fighters to stop, but nothing came out until the last of the 44 policemen was killed.

The CCCH is helping in the enforcement of the July 1997 interim cease-fire between the government and the MILF. Galvez is also the commander of the Western Mindanao Command when members of the Maute-Islamic State Group lay siege on Marawi City in May. Rene Acosta

waiving the said tariffs, amounting to about P2,100 per passenger, will mean a P4-billion revenue loss for the government over the course of five years.

“But, they will gain P299 billion in terms of tourist receipts —direct, indirect and induced revenues,” Comendador explained.

The government’s initial response to his group’s request, he said, was positive. His group wanted to open Clark International Airport as a new hub.

“They were willing to give it in Clark, because it is in line with Tugade’s policy. But then Davao wanted to open in Panglao, so what we told them was to do that in those hubs as well. They were startled,”

NAGTABON GIRLS Beginner models learn the craft of working with shutterbugs, who are also amateurs like them, at the two-day seminar on outdoor photography under the expert hand of the legendary Filipino and photographer George Tapan. Tapan recently collaborated with the World Ai Corp. to make the event happen in Puerto Princesa, where the developer of top-end leisure and resorts facilities is even now completing a P1-billion water and flower park designed to catch the fancy of ordinary Filipinos. Neo Green International Corp. president Keizaburo Homma said the lush grounds and world-class facilities at Ai World Park and Resorts, which has started to operate at only 40-percent completion, should all be up and running in about a year and a half. Jun Vallecera

Capital. . .

Continued from A1

Pernia earlier said the planned lowering of ceiling for foreign retail investments will form part of the shortened list of economic activities and areas reserved for Filipinos due to be out by year-end. Pernia reasoned this will be an incentive for local businesses to ramp up their

competitiveness. It will also benefit Filipino consumers. The Philippines’s Retail Trade Liberalization Act spreads foreign participation in retail activity into four categories.

Category A, covering enterprises with a minimum paid-up capital of less than $ 2.5 million, is closed to any kind of foreign equity and is reserved to Filipinos. Category B is for enterprises whose capitalization exceed $2.5 million, but less than $ 7.5 million, and may

be fully foreign owned. Category C raises the minimum to $ 7.5 million, while Category D imposes the $ 2.5-million requirement on a per-store basis for enterprises selling high-end and luxury products.

The government is required to issue a Foreign Investment Negative List every two years. Pernia is eyeing to come out with the first under the Duterte administration before the end of 2017. Catherine N. Pillas

rom October 16 to January 15, 2018, mall operations during weekdays will be from 11 a.m. to 11 p.m., the Metropolitan Manila Development Authority (MMDA) announced last Sunday.

MMDA Chairman Danilo Lim said this is part of schemes formulated with mall operators that are meant to alleviate the expected heavier vehicular traffic during the Christmas season.

Lim said the agreement was reached during the agency’s meeting with the mall operators and owners last month held at the MMDA main office in Makati City.

MMDA Assistant General Manager for Planning Jojo Garcia, said in addition to the late opening of malls, deliveries shall only be from 11 p.m. to 5 a.m. the next day to lessen delivery vehicles traversing the road during rush hours.

“Perishable goods are exempted. It should not be compromised,” Garcia added.

Lim said these measures

11 a.m. to 11 p.m.

The weekday mall hours from October 16 to January 15, 2018 would help reduce traffic congestion, especially during payday Friday. Lim also appealed to the public to start their holiday shopping early.

“Let’s enjoy the coming holidays and, at the same time, sacrifice a little; we need the cooperation of everyone—the mall owners and, operators and the public. Let’s plan our travels this holiday season,” Lim stressed.

Mall owners and operators welcomed the move of the agency. “We support MMDA’s efforts to ease traffic as Christmas nears. It is good for the public. It will also be good for business,” they said. Present during the meeting were representatives from Ayala Malls, SM Supermalls, Robinson’s, Starmall, Shangri-La and Rockwell. Claudeth Mocon-Ciriaco

7-mo tourism receipts up 21%, arrivals 11% Continued from A1

early part of the year, are keeping the cumulative numbers in the Philippines in the positive, even as monthly arrivals, especially from some major destinations, have slowed down. Beijing had committed to send 1 million of its citizens as tourists to the Philippines this year.

Asked if he sees Beijing’s commitment coming to fruition, Tourism Undersecretary for Tourism Development Planning Benito C. Bengzon Jr. said the agency would be “in a better position to extrapolate” the year-end arrivals from China once the visitors data for July and August are collected. “But it’s safe to assume that China will continue to grow at a rate much faster than other source markets,” he added.

For July 2017 alone, visitor arrivals reached 568,035, just a slight 1.28-percent rise from July

2016. In contrast, July 2016 arrivals jumped a substantial 14.5 percent to 560,872 compared to the arrivals in the same month in 2015. In the past months, DOT officials have been admitting that the continued political issues in the country, including the ongoing martial law in Mindanao, which was declared to quell Islamic jihadists movements, have affected the growth in visitor arrivals.

In terms of source markets, arrivals from South Korea continued to account for the largest number of tourists in the Philippines, totaling 132,135 in July 2017. This was 7.5-percent less, however, than the July 2016 arrivals, which reached 142,793.

Tourists from China edged out Japan and the United States in terms of the most number of tourists in the Philippines for the month in review. The market grew almost 11 percent to 90,763 in July 2017, putting it in second place.

The US ranked third with 86,017 visitor arrivals, an increase of 14.84 percent from July 2016. The DOT estimated visitor receipts in July 2017 to have reached some P33.53 billion, up 58.22 percent from the same month in 2016. Each foreign tourist spent an average of P5,989.49 in the country every day during said month, an increase of 15.3 percent from the average daily spend in July 2016.

Also, tourists stayed an average of 9.81 nights in the country in July 2017, compared to 8.47 nights in the same month in 2016. It was estimated that each of these tourists spent an average of P58,756.86 for their entire stay in the country. In contrast, each foreign visitor spent an average of P43,995.49 during his entire stay in July 2016.

Despite the apparent monthly slowdown in some key markets, DOT officials underscored the strong growth in cumulative ar-

rivals, especially when compared to other countries. Bengzon said, “I think what’s important, the UNWTO [United Nations World Tourism Organization] just reported the global growth rate in international visitor arrivals is slightly below 4 percent. The growth rate in Asian international arrivals based on the most recent report generated is just under 10 percent. So, when you talk about the Philippines generating 11 percent to 12 percent, we must doing something right, considering all the challenges we face, and, mind you, this is something that was not generated [just] for this year. We have been above the curve over the past five years.”

He stressed that this growth rate in arrivals for the Philippines can be considered robust, considering its location compared to its Asian neighbors. “This is something I think hopefully people will appreciate more, because for

an archipelago to have a growth rate higher than the Asian average or global average, which enjoy the benefit of cross-border traffic [as it is in other Asian countries], that means we must be doing something right, with respect to route development, with respect to [maintaining an] optimum mix of source markets that will collectively produce the numbers, and the growth rates that are prevalent.”

According to the DOT, close to 500,000 airline seats between the Philippines and other foreign destinations have been added this year, as government negotiators from the transportation and tourism sectors claimed success in enticing more international carriers to fly to the Philippines, especially to secondary gateways outside of Manila. (See, “Flights to and from Manila among world’s busiest,” in the BusinessMirror, September 28, 2017.)