Businessmirror october 13, 2016

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Thursday, October 13, 2016 Vol. 12 No. 1

SOLDIERS‘RATTLED’ BY EVERY COMMAND DUTERTE DISHES OUT

Solons thumb down removal of rice QR INSIDE

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awmakers on Wednesday expressed their opposition to the decision of economic managers not to push for the extension of the quantitative restriction (QR) on rice, which will expire next year. House Committee on Economic Affairs Chairman and Bohol Rep. Arthur C. Yap and Party-list Rep. Tomasito S. Villarin of Akbayan said removing the rice-import quota will make it more difficult for farmers to compete in Asean. “My concern is that, when you lift the QR, it will open up the Philippines to more rice imports. While this will

benefit millions of consumers, I feel we should prepare to address the dislocation of [farmers] who will not be able to compete,” Yap told the BusinessMirror in an interview. Yap, a former agriculture secretary, said the government should consider deferring the removal of the QR for a year, so it could implement the neces-

YAP: “We should prepare to address the dislocation of [farmers] who will not be able to compete.”

sary measures to mitigate its adverse impact on rice farmers. “I think we should ask for a one-year deferment. I will ask the [national government] to submit a list of possible farmers who will be affected, so they could be included in the Conditional Continued on A2

Blame Duterte’s diplomatic slips on DFA’s internal mess By Recto Mercene

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@rectomercene

HEN asked why it seems that the President often stumbles into the deep mire of diplomatic faux pas, a former Filipino diplomat says it is because the country’s top implementer of foreign policy has “structural problems.” “Thank you for asking, so I can say it openly,” retired Ambassador Alberto A. Encomienda, the country’s former

PESO exchange rates n US 48.4970

envoy to Greece, Malaysia and Singapore, said in an interview. “The problem in the DFA [Department of Foreign Affairs] is structural and, please, believe me, I was in the DFA for 40 years doing my job very seriously.” Asked what he meant by “structural,” he said: “When I joined the DFA in the late-1960s…early-1970s, we had topnotch diplomats” Undersecretary Jose D. Ingles, Leon Maria Guerrero,

Encomienda: “The problem in the DFA is structural.”

AP PHOTO

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GOVT TOLD TO EXTEND IMPORT-QUOTA SCHEME BY ANOTHER YEAR

By Jovee Marie N. dela Cruz

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By Rene Acosta

@reneacostaBM

resident Duterte is expected to go down in history books as the only commander in chief in the history of the Armed Forces, who, in every order he makes, not only rattles soldiers, but would leave commanders on their own to explain that such directives are not yet final, and subject to clarifications, not from the President himself but from his subalterns. Oftentimes, it has been observed that the President’s orders are reversed or, worse, outcommanded by his own subordinate defense officials and senior military officers. During the past weeks, Defense Secretary Delfin N. Lorenzana was preoccupied in explaining and clarifying Mr. Duterte’s defense and security pronouncements, admitting that one has to “see the many finer points” of some of these policy directives. “He’s a very poor commander, an erratic commander in chief whose orders are subject to challenge every time,” an Army junior officer remarked. “I would not go into battle with him as my commander. We will all die. He will order for an attack, and yet, in the middle, he will backtrack,” he added, referring to See “Soldiers,” A2

Continued on A2

n japan 0.4686 n UK 58.8172 n HK 6.2516 n CHINA 7.2184 n singapore 35.1606 n australia 36.5425 n EU 53.6134 n SAUDI arabia 12.9342

Source: BSP (12 October 2016 )

News BusinessMirror

A2 Thursday, October 13, 2016

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Solons thumb down removal of rice QR Continued from A1

Cash-Transfer Program of the government,” he said. “The government could also consider putting in place microfinancing schemes and assist them in accessing the shared services facilities of the Department of Trade and Industry,” Yap added. The lawmaker noted that Manila could make a “special request” to the World Trade Organization (WTO) to allow “special treatment” for commodities that are critical to a country’s food security. Yap also said President Duterte should certify as urgent several bills that seek to help farmers. “The President has promised that he will provide free irrigation water so maybe the bill reforming the National Irrigation Administration (NIA) must be certified as urgent,” he said. “Crop insurance in the country is also

not enough, that is why amendments to the Philippine Crop Insurance Corp. [PCIC] must be certified as urgent, as well. There is also a bill seeking to institutionalize the Agricultural Guarantee Fund Pool,” Yap added. There are several House bills seeking to reform the NIA and the PCIC. Amendments to the PCIC aim to allow the agency to offer index-based insurance coverage and engage in reinsurance to increase its funding source. Proposals to institutionalize the Agricultural Guarantee Fund Pool seek to include postproduction in its coverage. “If the government wants to lift the QR, then these measures must be in place. But even if these measures are prioritized and certified as urgent, the government’s social protection programs must be implemented for affected sectors,” Yap said.

‘Magnificent 7’

Villarin said his group in the House of Representatives, dubbed as “Magnificent 7,” will reject the recommendation of the National Economic and Development Authority (Neda) to scrap the rice-import quota. “Primarily, the DA [Department of Agriculture] should decide on this and not the Neda. With the lifting of the QR, the National Food Authority will be toothless in terms of rice imports. But I hope the Neda should change its mind,” he said in separate interview with the BusinessMirror. “For the longest time, we’ve been buying from other rice-producing countries. Are we now saying that we can compete with them?” Villarin added. The lawmaker urged the House of Representatives to immediately table for discussion his House Resolution 392, which seeks to clarify the implications of lifting the QR on rice next year.

Villarin said Agriculture Secretary Emmanuel F. Piñol told him during the DA’s budget briefing that he is personally not in favor of lifting the restrictions on imported rice and would, instead, ask for an extension of two more years. “Ideally, such period of extension will give authorities time to spur long-awaited developments in the agriculture sector, allow small farmers to stabilize their production and to compete with fellow producers, both within and outside the country,” he said. “I fully support efforts to help our farmers profit from plowing their fields,” Villarin added, “but the first step in helping our farmers is to tell them the truth about the real and growing challenges in their field.” Earlier, Piñol said the QR must be extended for two more years to allow Filipino rice farmers to compete with their Asean counterparts. The DA chief also said that,

Blame Duterte’s diplomatic slips to DFA’s internal mess Continued from A1

Narciso Ramos, Blas F. Ople, Manuel Pelaez and many more. They’re not around anymore. “There were people next in line, but the whole thing has been muddled by how we defined the role of the DFA.” Explaining further, Encomienda said; “Let me cite one thing, we have a Foreign Service Institute [FSI], perhaps, we should start there. But you look at the curriculum at the FSI, it does not give you confidence that it will be churning out trained diplomats.” “No. 2, too much emphasis on the passport aspect and the so-called protection of nationals. That is not

the job of the DFA; the foreign ministry is basically a think tank.” To explain how much the DFA had fallen into disrepute and anonymity, Encomienda gave an example, where people who have serious business to discuss would ask the taxi driver: “Take me to the Department of Foreign Affairs.” And the driver would remark; “Ah, iyong sa Macapagal Avenue!” “Hindi, iyong sa Roxas Boulevard!” the rider would correct the driver. “Hindi nila maintindihan kung nasaan sa Roxas Boulevard ang [They could not understand where on Roxas Boulevard the] Department of Foreign Affairs. Even the outlook of the people has changed, thinking the DFA is just for passports,” Encomienda rues. The soft-spoken diplomat retired in 2008, after spending 10 years on the country’s maritime concerns as an Archipelagic State. He headed the then-Maritime and Ocean Affairs Center (MOAC) in the DFA until 2008. Wanting to leave a legacy to his children about his life in the Diplomatic Service, Encomienda said he wrote a 75-page monograph. He said he showed the finished product to his colleagues and found it to their liking, so much he was encouraged to expand it. The result is a 240-page book, The South China Sea Issues and Related Core Interests of the Philippines. “But it is so boring you have to include cartoons,” he was told, so that the book that came out of the printing press—less than a hundred copies because he had to shoulder all expenses—contains the biting sarcasm of our foreign and local top editorial cartoons to make a lively companion to his oeuvre. “I’m not a writer,” he confesses, “I am a diplomat and I thought that my monograph would be for my immediate family’s consumption. He said he had been looking for an editor to make his book readable to the general public. This was brought about by the sudden popularity of his book, coming out shortly during the South China Sea dispute with China and the favorable ruling for the Philippines by the Permanent Court of Arbitration in The Hague, the Netherlands. According to Encomienda, there was an ongoing, hotly debated internal issue when he was still in the DFA, and that was, who should handle the passport office. “Normally, the Department of Foreign Affairs is a think tank. If you check with other countries—although I have not done extensive research—but I know for a fact that in the Netherlands passports are issued by the police department. The sense is that the passports should be by

the agencies that have the strongest and direct contact with the citizens.” What Encomienda said appears true because in the Philippines, passport applicants must produce, among others, a clearance from the National Bureau of Investigation, a birth certificate from the National Statistics Office (NSO), a clearance from the barangay where he lives, and if married, another certificate, etc. “Right now, I would say it should be with the DILG [Department of the Interior and Local Government].” The former envoy said the issuance of passport and protection of nationals “is giving a lot of distraction to the more important work of the DFA as a think tank on foreign policy.” In his time at the DFA, he said they wanted the passport office to be issued by the Department of Justice (DOJ), because there was no DILG at that time. But the idea did not prosper and the passport issuance and the income derived from it by means of fees “go directly to the DFA for it to spend for itself.” “Today that money goes, not to the DFA anymore but to the national government and we are given a budget. Noong una, it was a good idea, it should have been a way to go because a lot of senior DFA officials said we needed a lot of money, so that idea [giving the passport office to the DOJ] died.” “Now we have no control of the passport money,” he added. “Can the DFA be streamlined so it can play its role as a think tank?” Encomienda said the passport issue is only one issue, saying, today DFA personnel are concerned mostly with (1) promotions, (2) assignments and (3) allowances. He added that from the beginning, the DFA is not attracting the best minds but added that there are many distractions today, aside from what he mentioned, for a career official to excel. He refused to elaborate. Today, Encomienda said the furor engulfing the DFA are the rumored appointments of individuals who are not “career people,” or those from the rank. “I have no objection about appointments outside of the career, because in the first place, ideal ba ang career service ngayon, no?” “Going back to what I said, it’s really a distraction, this passport function, it’s all over the country.” The BusinessMirror checked with recruitment consultant Manny Geslani and said that, from a Senate hearing a week ago, where Foreign Secretary Perfecto R. Yasay Jr. was present, the legislators gathered that the DFA earns about P225 million a year from 300,000 passport applicants or those who renewed their documents. That is an average of 15 thousands applicants per day, processed at 22 DFA consular offices across the country. Encomienda read about the hundreds of Indonesian pilgrim to Mecca, caught red handed last month at the premier airport, while in possession of genuine Filipino passports. Some of them were repatriated to Indonesia. He said this availability of genuine passport falling into the hands of foreigners is not the only anomaly at the DFA. Other anomalies include the printing and awarding of contracts to companies that manufacture passport booklets.

if the QR is eventually lifted and more rice imports would enter the rice market, Filipino farmers would be discouraged from planting the staple, as rice from neighboring countries is cheaper. Earlier, Socioeconomic Planning Secretary Ernesto M. Pernia said the removal of the QR quota next year is a “done deal,” as three members of the core economic cluster have already agreed on the scrapping of the rice-import quota. “The Neda and the DA must disclose to the public the policy adjustment the administration will make in order for the affected sectors to cope with the lifting of the QR on rice,” Villarin said. He added that the Tariff Commission and other appropriate agencies should also reveal how the current tariff and nontariff regimes for rice has fared in terms of providing actual protection to the country’s rice farmers.

Soldiers. . .

Continued from A1

Mr. Duterte’s penchant to reverse or, worse, blur his own orders or statements. President Duterte has issued a number of directives in the form of strong statements over the past weeks, most of them concerning the country’s defense and security relations with the United States, but his officials said all of them, except one, are not yet final. Before he was elected, Mr. Duterte said he would ride a Jet Ski into the West Philippine Sea, apparently to assert the country’s claims against China, only to establish a China-leaning diplomacy after he was elected. Not contented, he also ordered the military to procure weapons and other armaments from China, and even Russia, only to be reminded by Lorenzana that it may not work out, since the Armed Forces has been used to handling Western-supplied weapons. Firearms maybe, but not other weapons, the defense chief said. Initializing his anti-American rhetoric, the Commander in Chief said US Special Forces troops assisting Filipino soldiers in the counterterrorism operations in Mindanao should go because in no way they are helping, but Lorenzana and even Malacañang officials said the pullout is not yet final. The Palace even offered explanations that President Duterte is only concerned with the safety of the American soldiers. On the other hand, Lorenzana said they need to brief the President and give him the “real picture.” Unlike past presidents who have solid appreciation of the issues in the Armed Forces, Mr. Duterte has the habit of issuing strong but controversial statements, only to backtrack later. “His mouth sets the tone for his mind to follow,” one soldier said. “The President should be reminded by people around him that anything he says will automatically forms part of the government’s policy, the military not exempted,” he added. The problem with the Commander in Chief, as former President Fidel V. Ramos has observed, is “he is not listening.” President Duterte has also said he no longer wants the conduct of joint patrols with the US in the South China Sea, of which, in the first place, none has happened yet, and that he favors a review of the Enhanced Defense Cooperation Agreement. Malacañang officials said these pronouncements of Mr. Duterte are not yet final, as they went on to clarify and explain these pronouncements. However, as the Commander in Chief wanted the Philippine Bilateral Exercise, which closed on Tuesday as the last exercise between the US and the country, Lorenzana has informed US military officials that it will be so. But again last week, President Duterte said he was ready to break ties with the US, but on Tuesday, he changed his stand and said he would not cut military ties with the Americans, although he was asking himself whether such partnership is still needed. “The President is losing credibility because of his double talk. He should exert effort to study, acquaint himself of issues before he opens his mouth,” another military officer said. He added Mr. Duterte’s security policy with the US is something that the Armed Forces is closely following, but their Commander in Chief’s “dangerous liaison” with China is “deeply troubling,” which could break the tie for military.

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Dulay laments zero conviction vs tax cheats

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By David Cagahastian

@ davecaga

espite President Duterte’s avowed policy to go after tax evaders and make them pay by whatever means necessary, the government has yet to successfully prosecute tax-evasion cases, much less obtain a final conviction against a tax evader. Instead, of the close to 500 taxevasion cases filed by the Bureau of Internal Revenue (BIR) during the previous administration, a considerable number has already been dismissed at the level of the prosecutor at the Department of Justice (DOJ). Internal Revenue Commissioner Caesar R. Dulay said he was “astonished” that many of these taxevasion cases filed under former Internal Revenue Commissioner Kim Henares are being dismissed by the DOJ prosecutors for lack of probable cause. “The policy is that if they don’t

pay and they don’t apply to settle, then the commissioner can authorize the filing of criminal cases against them,” Dulay told the BusinessMirror. “We’re just waiting for the DOJ resolutions on these cases, but sometimes we’re astonished that some of these cases are suddenly being dismissed,” he added. Dulay said that, out of the 496 cases filed under the Run After Tax Evaders (RATE) campaign before the DOJ, 329 are either at the preliminary investigation stage or up for resolution, while the rest has been resolved. The BIR has yet

496

The number of cases filed under the Run After Tax Evaders campaign to list how many of those resolved cases were filed in court and how many were dismissed and are subject to a motion for reconsideration by the BIR. “We’re still collating cases under motion for reconsideration, but one dismissed case is PhilRem [Service Corp.] or Salud and Michael Bautista with an assessment of P35 million,” Dulay said. A source from the BIR said it would be hard to prove tax evasion, even in cases of a fraudulent return filed by the suspected tax evader, which can be corrected with the simple expedient of having the taxpayers’ accountant testify to having committed a bookkeeping error. “Even in cases of a fraudulent return, the presumption that there was an intent to evade taxes could be overturned because the tax-

payer’s accountant could testify that there was a mere mix-up in the recording of when the reported income was received, accrued or realized,” the source said. Justice Undersecretary Eric Balmes told the BusinessMirror the DOJ has assigned a CPA/ lawyer as an assistant secretary in the person of George Artha to help in prosecuting these taxevasion cases. BIR Officer in Charge for the Enforcement and Advocacy Service Felix Velasco said that, with the dismissal of the criminal charges at the level of the DOJ prosecutors, the BIR is left with either the filing of a civil case or the summary remedies of distraint and levy to be able to collect on the tax-deficiency assessments. Despite these efforts to prosecute tax evaders, the government has yet to obtain a final conviction against one, and it appears that President Duterte’s very own style of enforcing the law is not only useful in the war against drugs, but also in efforts to collect the correct taxes. In one of his off-the-cuff remarks, Mr. Duterte said he would ask the police to knock on the doors of suspected tax evaders and ask

them why they are not paying the correct taxes. President Duterte said he would ask Dulay to prepare a list from which a police operation akin to “Oplan Tokhang” will be rolled out for tax evaders. “I will send the police to see you and ask why you have not been paying taxes. I will ask the media to accompany the police so the police can ask in front of the media why they have not been paying the proper taxes and why they are deceiving the Republic of the Philippines,” Mr. Duterte said in an impromptu speech in August. President Duterte added that those suspected tax evaders who would land on Dulay’s list will be put in the Bureau of Immigration’s watch list to restrict their right to travel. “If you’re rich and don’t pay the correct taxes, you cannot travel anymore. I will tell the Immigration to stop you because you committed a violation. I will order the BIR to file cases and once it’s pending in court, the freedom of movement is restricted,” he said. Dulay said he has yet to complete the list, but is readying one just in case Mr. Duterte, indeed, asks him for the list of suspected tax evaders.

Duterte set to visit China next week

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resident Duterte will make a state visit to China next week in the latest sign of reaching out to Beijing while questioning his country’s traditional ties with the United States. China and the Philippines made the long-expected announcement on Wednesday for the October 18 to 21 visit. Despite their ongoing dispute over territorial claims in the South China Sea, Mr. Duterte has said he wants stronger ties with China to gain funding for development projects and reduce US influence over its former colony. President Duterte said on Tuesday he will not abrogate a defense treaty with the US but questioned its importance and that of joint combat exercises, which China opposes. He also wants US counterterrorism forces to leave his country’s south, saying their presence was inflaming restiveness among minority Muslims. AP

Asean

BusinessMirror

A6 Thursday, October 13, 2016 • Editor: Max V. de Leon

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Thailand, PHL lead stocks drop

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merging-market stocks declined for a second day, as lingering concerns the Federal Reserve (the Fed) will raise interest rates this year damped demand for higher-yielding securities. The MSCI Emerging Markets Index fell 0.4 percent as of 8:21 a.m. in London, set for the biggest two-day drop in a month, as stock gauges in Thailand, the Philippines and China led declines. An index of developing-nation currencies was little changed after dropping to a three-week low on Tuesday. The Fed will release minutes of its September policy meeting on Wednesday, providing possible clues on when rates will rise. Mexico’s peso gained for a third day. “The risk aversion in the market has accelerated,” said Ho Woei Chen, an economist at United Overseas Bank Ltd. in Singapore. “Asian currencies will continue to come under pressure.” Prospects that the Fed will raise rates for the first time since December have undermined the case for investing in emerging-market assets, which has been that they offer higher yields than developed nations, where central banks are keeping borrowing costs low

to prop up growth. Emerg ing-market stocks have snapped four months of gains, as the market-based odds of a Fed rate hike this year climbed to 68 percent on Tuesday, from 59 percent at the end of September. Ten-year US Treasury yields have jumped 18 basis points this month, while the Bloomberg Dollar Spot Index increased 1.4 percent. “We’ll see more stress on emergingmarket currencies, as and when a Fed hike gets closer,” said Jeffrey Halley, a market strategist at Oanda Asia Pacific Pte. in Singapore. “The main driver is US yields firming across the curve which is a result of the market increasingly pricing in a Fed hike in December.” Ten of 11 industry groups in the MSCI’s stock index dropped, led by realestate companies and finance shares. Thailand’s benchmark SET Index of shares slumped 2.6 percent as investors sold the nation’s assets after the royal

We’ll see more stress on emerging-market currencies as and when a Fed hike gets closer.” —Oanda Asia Pacific Pte

palace said on Sunday the king’s condition was unstable. The Philippine Stock Exchange Index fell 1.5 percent, sliding for a sixth day in the longest losing streak in five weeks. The Hang Seng China Enterprises Index retreated 1.8 percent, while the Shanghai Composite Index fell 0.2 percent. South Korea’s Kospi index was little changed after falling as much as 0.5 percent. Samsung Electronics Co. dropped 0.7 percent in Seoul. The company’s shares plunged 8 percent on Tuesday in the biggest tumble since 2008 after it stopped production of problematic Galaxy Note 7 smartphones. The MSCI Emerging Markets Currency Index fell 0.1 percent after sliding 0.7 percent on Tuesday. Malaysia’s

ringgit weakened 0.3 percent, after Brent crude fell the most in two weeks overnight, amid uncertainty over Russia’s willingness to join Organization of the Petroleum Exporting Countries efforts to stabilize the market. The won depreciated 0.3 percent, after recording its biggest one-day drop in a month on Tuesday. South Korea’s 10-year government bonds rose for the first time in three days, pushing the yield down two basis points to 1.59 percent. The Thai baht dropped 0.7 percent, amid outflows from domestic assets. Global investors sold a net 3.4 billion baht ($96 million) in local bonds yesterday, according to data from the Thai Bond Market Association. “What we have been seeing is mostly dollar strength,” said Wu Mingze, a foreign-exchange trader in Singapore at INTL FCStone Inc., a Nasdaq-listed global payments-service provider. “We are already kind of preparing for weakness in emerging FX.” The rand fell 0.4 percent after plunging 3.9 percent on Tuesday, the biggest drop in more than three months. South African Finance Minister Pravin Gordhan was summoned to appear in court on fraud charges next month, the latest twist in a struggle with President Jacob Zuma that could cause the nation’s credit rating to be downgraded to junk. Bloomberg News

Duterte drug war will deter tourists

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olidaymakers like to spend their time away from work free from worldly cares. Images of extrajudicial killings and blood-soaked bodies lying in the streets can take the fizz right off that poolside mojito. That doesn’t appear to be a concern for the government of President Duterte, whose antidrug war has seen more than 3,000 people killed by police and vigilantes in less than three months. Visitors who aren’t bringing narcotics into the country have no reason to fear the campaign, Mr. Duterte’s Tourism Secretary Wanda Corazon T. Teo told a press briefing last month. Local media seem more concerned about proposals to change the country’s official tourism slogan and plans for staging next year’s Miss Universe beauty pageant. At first glance, it may seem this confidence is well-placed. Tourist arrivals reached a record 560,872 in July, suggesting little drop-off in visits in the two months since Mr. Duterte was elected. Arrivals from South Korea and China, the Philippines’s two biggest markets, rose 20 percent and 23 percent respectively from a year earlier, while numbers from third-placed US were up 15 percent. Don’t count on that dynamic holding. Holidays are a lagging indicator, typically booked months in advance. Thai visitor arrivals actually increased year-on-year in February 2003, when former Prime Minister Thaksin Shinawatra began his own bloody war on drugs. It was only in May, the same month that Thaksin declared victory in the campaign, that arrivals hit rock bottom—driven in no small part by Asia’s SARS epidemic—falling 50 percent from a year earlier to their lowest level since at least 1997. Holidaymakers’ tendency to shun regional bloodbaths shouldn’t come as a surprise, because tourist destinations are highly substitutable. In 1995 people wanting to experience coastal resorts, bustling cities and a glimpse of the historic cultures of the eastern Mediterranean spent about 50 percent more money in Egypt than in Turkey, according to World Bank data. Terrorist attacks reversed that pattern: By 2014, Turkey’s tourist receipts were 57 percent higher. The Duterte administration and some local tourism operators appear to hope that the antidrug campaign will encourage tourists who fear criminality. Evidence suggests otherwise, because holidaymakers are highly sensitive to a country’s public image. A substantial increase in humanrights violations deals an even bigger blow to tourism than terrorism or general violence, according to a 2004 paper by London School of Economics and Political Science professor Eric Neumayer, causing visitor numbers to fall 32 percent. Workers sitting at their desks dreaming of dropping out of the rat race for a few weeks tend to let their thoughts drift to palm-fringed islands and white-sand beaches. They’d like to think of tropical fish darting between coral pinnacles on a snorkeling trip, rather than the specimens Mr. Duterte boasts will grow fat on the bodies of drug dealers dumped in Manila Bay. Even setting aside the tragedy of those slain in Mr. Duterte’s antidrugs campaign, it’s an own goal for the Philippine economy. Tourism receipts between January and July totaled P148.6 billion ($3.1 billion), making the sector a bigger export earner than any merchandise product barring semiconductors. The Philippines has long trailed Thailand, Malaysia and Singapore in terms of tourist arrivals, despite a splendid endowment of natural wonders and the highest level of English fluency in East Asia. Now, it’s fighting outright relegation, with former fringe destinations, such as Myanmar, Cambodia and Lao PDR threatening to overtake.

Bloomberg View

Where does PHL want to be in Asean and beyond? Asean-EU Perspective

HENRY J. SCHUMACHER

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n a study conducted by IHS in 2015, it was estimated that the Philippines has the potential to become a trillion-dollar market by 2029, with a GDP per capita of $6,000 by 2024, subject to continued high levels of economic growth. The benefits of such growth on the country, as a whole, and on individual prosperity, the reduction of inequality and employment generation can be exponential, as IHS’s estimated increase to GDP per capita highlights. There is no doubt that that is where local and foreign business want the Philippines to be in the next 15 years. We want to see an economy that has managed to sustain longterm economic growth and to become a leading economy in the region in terms of market share, total trade and incoming foreign direct investment (FDI). As the European Union (EU) business community in the Philippines, we want to see the Philippines becoming one of the most important trade and investment partners for EU Member States in the region. All this with concrete benefits for the country as a whole and, most especially, for those that have, up to now, benefited least from the country’s economic growth. How do we get there? For the Philippines, it has largely remained a catch-up game with other Asean countries that have long benefited and continue to do so, from clever industrial policies and business friendly reforms, which have led to exponential growth in FDI in the past years. The Philippines has the potential to move away from that catch-up game and strive towards becoming a regional leader in terms of foreign investment and trade, thanks to its solid macroeconomic foundations, a consumer-driven economy, combined with a pool of over 100 million consumers with a low median age, significant market gaps that need to be filled and sectors with high growth potential, such as tourism, ICT/BPM/ KPM, agri-food supply and value chains, automotive, infrastructure, energy and health care. For the Philippines to reach that potential, however, business as usual is not enough. Instead, there is a need for a dynamic and proactive approach toward addressing the factors highlighted above, as areas which need improvement and which have so far kept the Philippines back compared to its peers in the region.

Infrastructure development

Infrastructure development that facilitates, economic growth remains a priority for the country’s continued development. While public spending in infrastructure has increased greatly in the past years, there is still space for a more comprehensive approach to infrastructure development, which ensures adequate infrastructure for the coming years, better cost-efficiency and more innovation. The private sector is willing to be part of that process, but first it is necessary to establish more dynamic implementation of public-private partnership projects. Equally, the creation of a level playing field for foreign companies will open the way for international standards and innovation to be applied to infrastructure projects across the country.

Global market integration

Trade facilitation, a proactive approach to bilateral and multilateral trade agreements and an economic policy direction that prioritizes international economic integration are key to the Philippines’s economic growth, not least due to the country’s membership of the Asean Economic Community, which the Philippines is chairing in 2017.

Competitiveness as an FDI destination

FDI levels have shown great improvement in the past years. However, the Philippines still lags behind other countries in the region. Employment generation, especially among low skilled workers who are largely missing out of the country’s current economic growth, has much to gain from increased FDI in the country. How can the Philippines become more attractive to investors looking into the region? Lifting investment restrictions on foreigners, moving toward more competition in sectors saturated by few domestic players, providing competitive investment-incentive schemes and improving the ease of doing business across the country by adopting best practices applied in Philippine Economic Zone Authority zones, will all contribute to transforming the Philippines into a more attractive destination for FDI. A change of mind-set needs to happen in both the private sector and the government. We recognize that this is not an objective that can be solely achieved by government efforts, or solely by the private sector. There needs to be a cooperative approach, with the government making decisive moves to pass the necessary reforms and the private sector supporting the implementation of those reforms in a fair, transparent and effective way, in a mutually beneficial public-private partnership.

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The World BusinessMirror

Thursday, October 13, 2016

More overstayed visas than caught crossing US border S

AN DIEGO—More than 20 years had elapsed since the US government estimated how many people entered the country legally and overstayed their visas. The updated numbers, finally published in January, were sobering. The Homeland Security Department said 527,127 people who were supposed to leave the country in the 2015 fiscal year overstayed, more than the population of Atlanta. And that was only those who entered by plane or ship, not on land. To put that in perspective, the Border Patrol made 337,117 arrests of people entering the country illegally during the same period, nearly all on the border with Mexico. More people overstayed visas than were caught crossing the border illegally. An estimated 40 percent of the

11.4 million people in the US illegally overstayed visas, a crucial, but often overlooked, fact in the immigration debate. That percentage may grow as India and China replace Mexico as the largest senders of immigrants to the United States. Mexicans have long entered illegally through deserts of California, Arizona and Texas, but the absence of a shared border makes that route unlikely for Asians. Overstays accounted for about 1 percent of 45 million visitors on business and tourist visas from October 2014 to September 2015,

according to the long-awaited Homeland Security report. Canada occupied the top slot for overstays, followed by Mexico, Brazil, Germany and Italy. The United Kingdom, Colombia, China, India and Venezuela rounded out the top 10.

527,127

The number of people who were supposed to leave the country in the 2015 fiscal year that have overstayed The Pew Research Center said last year that more Mexicans were leaving the United States than coming, ending one of biggest immigration waves in US history. Lack of jobs for unskilled labor after the Great Recession is widely cited as a reason, but border enforcement played a part. The Border Patrol more than quintupled to 21,444 agents in

2011, from 4,028 in 1993. The US erected fences along about 650 miles of border with Mexico, nearly all of it in the final years of George W. Bush’s administration. Last year Border Patrol arrests—one gauge of illegal crossings—fell to the lowest level since 1971. About five years ago, the busiest corridor for illegal crossings began shifting from Arizona to South Texas, where roughly two of every three apprehended are from countries other than Mexico. Large numbers of women and children from Central America turned themselves in to US aut hor it ies, t r ig ger ing leng t hy proceedings in clogged immigration courts. Images of children crammed into Customs and Border Protection holding cells made big news in 2014. “We weren’t chasing people. People were walking up, looking for someone in a green uniform,” said Customs and Border Protection Commissioner R. Gil Kerlikowske. “There were smugglers that would call 911 and say, ‘Hey, we got some people coming across.’

It was a border-management issue, not a border-security issue.... Do you have health-care personnel? Do you have food? Do you have clothing?”The government has taken steps to better track overstays, but it’s a tall order without a good checkout system. Airports weren’t designed to inspect visitors when they leave. The US and Canada have exchanged names of people from third countries who enter on their shared border since 2013, but Mexico generally doesn’t track who enters by land. Congress has long pressed for biometric screening—such as fingerprints, facial images or eye scans on departing visitors—but financial and logistical challenges have been enormous. “It’s tough because we just don’t have the infrastructure,” said Jim Williams, a former Homeland Security official who oversaw efforts to introduce biometric screening from 2003 to 2006. “It’s an open door. You [should] treat it like a house. You want to let people in you trust and you also want to know if they ever left.” AP

A7

Germany, utilities reach pact on nuclear waste

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he German government has reached an agreement in principle with utilities on a nuclear-decommissioning pact that will probably go into effect in Februar y, according to a person with direct knowledge of the matter. Reactor owners would have to stump up an initial payment of €23.3 billion ($25.8 billion), which was proposed by a government commission in April, as well as interest, to free them from their nuclear-waste storage liabilities, the person said. A contract has yet to be drawn up, said the person, who declined to be identified because the talks are private. Pressure has risen to determine how much the utility industry must pay when the last of Germany’s eight reactors closes in 2022, amid concerns that investors will punish RWE AG and EON SE if a line isn’t drawn under their nuclear liabilities. Chancellor Angela Merkel’s government decided to pull the plug on the 60-year-old nuclear industry in 2011, after the Fukushima catastrophe in Japan. The German Cabinet is scheduled to approve the deal on October 19, after an agreement was reached between deputy ministers and Merkel’s chief of staff, the person said. The German economic ministry declined to comment, saying a draft proposal is in the works and that it intends to seek Cabinet approval shortly. Bloomberg News

A8

Thursday, October 13, 2016 • Editor: Lyn Resurreccion

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Trump’s attacks ignite civil war inside GOP

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ith less than a month to go before Election Day, Republicans erupted into open warfare on Tuesday as Donald Trump pledged to campaign unshackled from party leaders and vowed to punish “disloyal” members, including House Speaker Paul Ryan and John McCain, the 2008 GOP nominee. “Disloyal R’s are far more difficult than Crooked Hillary.

They come at you from all sides. They don’t know how to win—I will teach them!” Trump tweeted. Trump has long expressed disdain for the Washington establishment, but he took it to a new level on Tuesday by signaling he may go after Republican Party leaders directly as he tries to salvage his embattled campaign. “It is so nice that the shackles have been taken off me and I can now fight for America the way I want to,” Trump said

in another tweet. In an interview later with Bill O’Reilly of Fox News, Trump described the shackles as “some of the establishment people that are weak and ineffective people within the Republican Party.” Trump saved particular vitriol for Ryan—a man many in the party view as a likely presidential contender himself one day—after the speaker said he’d no longer defend or campaign with Trump.

Ryan’s focus instead is on preserving the wide GOP majority in the House, as well as Republican control of the Senate, now seriously endangered by the Trump meltdown. The fast-moving events also increased the likelihood that voters could head to the polls on November 8 with decidedly mixed signals from the Republican Party, as the messages from Trump and those of many Senate and House candidates are directly at odds. Democrats, meanwhile, closed ranks behind nominee Hillary Clinton, with everyone from President Barack Obama to former Vice President Al Gore to Clinton’s defeated primary rival Bernie Sanders campaigning for her. Trump acknowledged the competitive disadvantage, tweeting, “Dems have always proven to be far more loyal to each other than the Republicans!” Crucially, Trump continued to have the backing of Reince Priebus, the chairman of the Republican National Committee (RNC), and their top fund-raisers. As long as he’s receiving campaign cash from the RNC, he can continue to pay for television ads and get-out-thevote operations. A new poll by NBC News and the Wall Street Journal, taken after a 2005 audiotape surfaced of Trump bragging about groping women, showed Clinton leading Trump by 9 percentage points in a four-way race.

‘Weak and ineffective’ In training his sights on Republican Party chiefs, as well as Clinton, Trump again upended the rules of conventional politics. “Our very weak and ineffective leader, Paul Ryan, had a bad conference call where his members went wild at his disloyalty,” Trump tweeted, referring to a Monday conference call where some House conservatives challenged the speaker. Trump said in the Fox interview that he may be “better off” without support from Republican leaders. Trump said of Ryan, “I don’t want his support, I don’t care about his support,” according to transcript provided by Fox. “I wouldn’t want to be in a foxhole with a lot of these people,” Trump said, “especially Ryan.” Trump also lashed out at McCain after the Arizona senator pulled his support from Trump on Saturday. “The very foul mouthed Sen. John McCain begged for my support during his primary [I gave, he won], then dropped me over locker room remarks!” he tweeted on Tuesday afternoon. By late Tuesday morning, Trump’s campaign released one of its most aggressive campaign ads so far against Clinton. Painting a dire picture of terrorists on the rise, the narrator says she does not have “the stamina to lead” over video of her coughing and stumbling at an event in September. Trump decided against turning the health scare into a campaign issue at first, but approved the message as his poll numbers sank. Many House Republicans, meanwhile, worry that Trump is damaging their party’s prospects to retain control of the Senate and to keep their sizable majority in the House. “It will be very difficult for Trump to win,” said Rep. Charlie Dent of Pennsylvania, a leader of House Republican centrists. He told his colleagues on the Monday conference call that it was time to distance the party from Trump.

‘Soul of the party’ In the long run, Dent said, “there is a battle going on for the soul of the party.” “There will be a reckoning after the election,” he added. Some House Republicans appear torn over how to proceed. Rep. Dennis Ross of Florida, a senior deputy majority whip, says he understands that Ryan is doing this because the speaker believes it is the best way to protect the House majority. “But we need to defeat Hillary,” said Ross, citing the future direction of the Supreme Court and other important issues tied to the White House race. And conservative Republican Steve King of Iowa said on Tuesday that Ryan has only increased the chances that Clinton will win the presidency. “If we let him sink, we’ll all sink with him,” King said in a radio interview, adding that the party might be forced to rebuild after this election, and that the establishment wing “could simply be amputated out.” Ryan is staying in Wisconsin this week, his aides say, with a speech planned in Madison on Friday. “Paul Ryan is focusing the next month on defeating Democrats, and all Republicans running for office should probably do the same,” said AshLee Strong, a Ryan a spokesman.

‘Authoritarian power’ At least a few Republicans openly cheered on Trump’s new approach. “Sometimes I wonder that our Constitution is not only broken,” Maine Gov. Paul LePage told a Maine radio station, according to NBC News, “but we need a Donald Trump to show some authoritarian power in our country and bring back the rule of law because we’ve had eight years of a president—he’s an autocrat, he just does it on his own, he ignores Congress and every single day, we’re slipping into anarchy.” Other prominent Republicans made clear that they’re still backing Trump, including Florida Sen. Marco Rubio, who lost to Trump in the GOP presidential primary. “I wish we had better choices for president,” he said on Tuesday in a statement. “But I do not want Hillary Clinton to be our next president. And, therefore, my position has not changed.” Bruce Ash, an RNC member from Arizona, insisted that RNC members were fully behind Trump and that Ryan made a mistake by giving up on Trump, adding that the speaker reacted “with his stomach and heart, rather than with his mind.”

‘Head down’ By contrast, Ash said Senate Majority Leader Mitch McConnell has approached this “very politically astutely,” because he “put his head down, waited for the bullets to fly and the circus to pass by.” McConnell on Monday simply declined to address the presidential race at all during a public appearance in Kentucky. Either way, the split leaves Senate Republicans running for reelection in a very complicated spot. Vulnerable candidates have split in their approach to Trump, with nearly a third of the chamber’s Republicans now saying they won’t vote for him. Bloomberg News

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Thursday, October 13, 2016

A9

The evolving face of US immigration

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ALEIGH, North Carolina—When Manasi Gopala immigrated to America, she finally got the chance to row crew. As a child in India, she had dreamed of the sport from watching Olympic telecasts. Now, twice a week, she pulls a pair of oars as her scull glides along tree-lined Lake Wheeler, far from her birthplace of Bangalore. Gopala is among throngs of educated Indians who have moved in recent years to North Carolina’s tech-laden Research Triangle and other areas across America. A 39-year-old software developer, she became a US citizen three years ago. “America had given me the opportunity to pursue my own life,” she said. Increasingly, the face of US immigration resembles Gopala. For all of Donald Trump’s talk of building a border wall and deporting 11 million unauthorized immigrants who are mainly Hispanic—and for all of the enduring contention over illegal immigration—immigrants to the US are now more likely to come from Asia than from Mexico or Latin America.

Well-educated and entrepreneurial And compared with Americans overall, immigrants today are disproportionately well-educated and entrepreneurial. They are transforming the nation in ways largely ignored by the political jousting over how immigration is affecting America’s culture, economy and national security. As of three years ago, Census figures show, India and China eclipsed Mexico as the top sources of US immigrants, whether authorized. In 2013 147,000 Chinese immigrants and 129,000 Indians came to the US, compared with 125,000 Mexicans. Most of the Asian immigrants arrived in the United States legally—through work, student or family visas. Immigrants are also more likely now to be US citizens. Nearly half of immigrants over the age of 25—18 million people—are naturalized citizens, compared with just 30 percent back in 2000, according to Census figures. Simultaneously, more Mexicans without documentation are returning home. The number of Mexicans in the United States illegally tumbled nearly 8 percent in the past six years to 5.85 million, the Pew Research Center found. Border Patrol apprehensions, one gauge of illegal crossings, last year reached their lowest point since 1971. With the share of US residents born abroad at its highest level in a century, immigrants increasingly defy the stereotypes that tend to shape conversations on the issue. Consider: About 40 percent of Indian immigrants hold a graduate degree. Fewer than 12 percent of native-born Americans do. And earnings for a median Indian immigrant household exceed $100,000— more than twice the US median.

Reflect extremes of economic spectrum The result of this recent influx is that America’s 40 million-plus immigrants more and more reflect the extremes of America’s economic spectrum, from super-rich tech titans to poor agriculture workers. The changes flash into view on a visit to the political swing state of North Carolina. The proportion of immigrants in the state’s population has quadrupled from 1990 to nearly 8 percent. Similar trends have emerged in Georgia, Colorado, Oregon and Washington. None of these states approaches the more than 20-percent share in California and New York, where educated Chinese immigrants are largely concentrated. Yet, the transformations are evident in a drive across the dense highways that connect North Carolina’s Research Triangle. Indian immigrants have put their distinctive stamp on this area. Their rising numbers have established a broad community that has made it easier for new arrivals to integrate than it was for prior generations. Asked how they have been received in the community, about a dozen Asian immigrants said they have generally been warmly accepted despite the national furor over immigration. “Now, you come from India, you don’t really have to know anything else,” said Pranav Patel, a 57-year-old software developer. “The system is here to help you adjust. There are no real hardships.” When the Hindu Society of North Carolina celebrated India’s independence day in August, one prominent outsider did show up: Gov. Pat McCrory, a Republican in a heated reelection campaign that has been fueled in part by a crackdown on illegal immigration. “This is the best of America,” he said, sharing the stage with a lifesized statue of Mahatma Gandhi. “This is the best of India. We work together. We learn together. We can pray together. We love family values together.”

Improved sentiment toward immigrants Americans’ sentiments about immigrants have largely hardened along racial, political and demographic lines. Overall feelings

Portugal open to Chinese venture in Azores as US presence dwindles

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ortugal is welcoming nonmilitary Chinese engagement in the Azores to help develop the logistical and research potential of the mid-Atlantic island chain. The growing Chinese influence on the archipelago is worrying Washington as the US reduces its military presence at the Lajes Field air base on the island of Terceira. A series of senior Chinese officials—including President Xi Jinping and Premier Li Keqiang—have used the island as a stopover on trips to Latin America, as China seeks to expand its footprint overseas and safeguard economic interests. In a Bloomberg Television interview in Macau on Tuesday, Portuguese Prime Minister Antonio Costa said that, while his nation—a North Atlantic Treaty Organization (Nato) member—would continue to honor its defense pact with the US, he also wants to see better use of the Azores. The islands are “very important both logistically in the Atlantic Ocean but also in terms of technology and research, in the field of climate change and deepwater research.” “The military use of the American base at this moment is not on the table, what is on the table is for EU [European Union] institutes, American institutes and Chinese institutes to reuse infrastructure for scientific research purposes,” said Costa, 55. “It’d be a huge waste not to use that infrastructure. We need to reuse that infrastructure, and if you are not going to use it for the military purpose, why not scientific research?” Lajes Field—3,690 kilometers east of New York and about 1,000 miles west of Lisbon—had served as a key link between the US and its allies in the Nato and the Middle East. Bloomberg News

toward immigrant workers remain negative. But sentiment has improved since 2006, possibly a sign that the growth of educated immigrants has begun to reshape attitudes, according to a Pew survey released this month. Two-thirds of Republicans and 54 percent of whites said they think immigration harms US workers. But a majority of Democrats, Hispanics and the college-educated said they

felt immigrants made society better off. By comparison, almost all economists view immigrants as helpful—even essential—for the nation’s continued prosperity. Because of the aging US population causing more retirements, most economists say immigrants are needed so that the work force increases to sustain overall growth. The anti-immigrant rhetoric has concerned Gopala.

She feels fortunate to no longer be among the millions of foreigners still applying for US residency. “I got very lucky that my green card was processed when immigration wasn’t a bad word,” Gopala said. “America had given me the opportunity to pursue my own life. On the day you’re born in India, your life is written. But here, that is not true.” AP

A12 Thursday, October 13, 2016 • Editor: Lyn Resurreccion

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Deadly Syria air strikes, shelling hamper aid efforts

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AIRO—Air strikes rocked Syria on Tuesday, killing more than a dozen people in rebelheld areas of the besieged northern city of Aleppo, and the shelling of a government-held area in a southern city killed at least six more people, activists and state media said.

Intense air strikes were reported in Aleppo, which has seen fierce fighting in recent months as the government forces of President Bashar al-Assad, backed by Russian allies, try to recapture the opposition-held east, home to about 250,000 people. In the souther n cit y of Dara, where the war began after antigovernment protests more than five years ago, rebels fired rockets at gover nment-held areas, according to the officia l Sy rian A rab News Agenc y (Sana). One hit an elementar y school, k il ling ha lf a dozen people— a mong t hem f ive c h i ld ren— and wounding 18 students, the news agenc y repor ted. Shelling by opposition groups was also reported in the capital, Damascus, including close to the Umayyad mosque, considered one of the oldest and holiest in the world, according to Sana. Fighting has intensified in recent weeks after the collapse of a cease-fire brokered by the US and Russia. The British-based Syrian

20

The estimated number of attacks that were bunkerbuster that caused a lot of damage

Observatory for Human Rights, which monitors the conflict, said at least eight people were killed in east Aleppo’s Bustan al Qasr and Fardous neighborhoods on Tuesday, but residents said the toll was higher. Amar Salmo, 32, who leads the area’s civil-defense volunteers, said more than 40 people were killed and more than 70 injured. “ The last week was so calm, so

This October 5 handout frame grab from a video provided by Doctors Without Borders shows a house on fire in Aleppo, Syria. The international charity Doctors Without Borders is pleading for access to treat the wounded in the rebel-held part of Syria’s Aleppo as government forces press ahead with an offensive that has killed hundreds of people in recent weeks. Doctors Without Borders via AP

quiet. Today was so explosive— more than 20 of these attacks were bunker-buster [bombs] and these make a lot of damage,” he said, referring to powerful explosives capable of penetrating underground shelters. Salmo and 120 volunteers zz-

worked to rescue victims from the rubble, many of them families. In Bustan al Qasr, they found four apartment buildings razed and a woman standing beside the ruins, just back from the market. “She returned home and asked, where is my building? Where are my children?” Salmo said. “We were searching for dead bodies. The neighbors told her, ‘This is your building and your family is under the rubble.’ We dug out about 15 persons.” East Aleppo has faced intense aerial attacks since last month, when a September 12 cease-fire collapsed after a week. Syrian government forces have also mounted a ground offensive into rebel-held areas of the city. “Everything is getting worse,” said Ismail Abdullah, 29, another civil-defense volunteer reached by phone in Aleppo. He said he knew of 16 people killed in the air strikes on Tuesday, seven of them children. “We are waiting for the next hour, for the night, to see if the situation will get worse,” he said. T he volu nteers, k now n as White Helmets, fear they will be targeted and have moved their office, he said. They also worry

about running out of fuel for ambulances. They have enough to last a week, but maybe not a month, Abdullah said, especially if the attacks increase. “Maybe in coming days we will run out of everything,” he said. Hospitals in east Aleppo have been receiving an average of 86 injured people a day but are down to 11 ambu lances, accord ing to government figures cited by the nonprofit Doctors Without Borders. Five ambulances were bombed during the last month, two of which were destroyed, the group said. “The whole world is witnessing the suffering of east Aleppo, a population trapped in a bloody battle without any chance to escape,” said Pablo Marco, Doctors Without Borders’ operations manager for the Middle East. “Syria and Russia must stop the indiscriminate bombing of the city. All warring parties must facilitate and allow the evacuation of the severely wounded and sick.” Krista Armstrong, a spokesman for the International Committee of the Red Cross in Geneva, said it has been difficult to deliver aid when cities across Syria “have seen unprecedented

levels of violence recently.” “The needs are rising but we need to see a cessation of violence in order to get to these areas,” Armstrong said, noting the organization hasn’t been able to reach east Aleppo since April. During an emergency session on Syria by the British Parliament, Foreign Secretary Boris Johnson called for protests outside the Russian Embassy. Johnson said he would consider a proposal to establish nofly zones in Syria but warned of the potential consequences. “We cannot commit to a no-fly zone unless we are prepared to…shoot down planes or helicopters that violate that zone. We need to think very carefully about the consequences,” he said. Instead, he urged diplomacy, “to persuade the Russians that it is profoundly in the interests of Russia to take the initiative, to win the acclaim of the international community, do the right thing in Syria…stop the bombing and bring peace to Aleppo and have a genuine cease-fire.” US State Department Spokesman John Kirby also called for an end to the air strikes at a Tuesday briefing. Los Angeles Times/TNS

Imprisoned Chinese minority scholar given rights award

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ENEVA—A group of advocacy organizations has awarded its annual prize for human-rights defenders to imprisoned Chinese Muslim minority economics professor Ilham Tohti, shining new attention on a case that has brought strong international condemnation. The Martin Ennals Award is bestowed by 10 rights groups, including Amnesty International and Human Rights Watch. A ceremony honoring the award, which was founded in 1994, took place in Geneva on Tuesday with his daughter in attendance. Tohti, 46, was given a life sentence on charges of separatism in September 2014 after a two-day trial. A member of the Turkic Muslim Uighur ethnic group, he taught at Beijing’s Minzu University and was an outspoken critic of Beijing’s ethnic policies in the far western region of Xinjiang. Tohti denied Beijing’s relentless accusations of advocating separatism and violence. His daughter Jewher Ilham said she hadn’t seen her father since they parted at the Beijing airport in February 2013, but her relatives had visited him in prison over the summer. While he and the visiting relatives were

barred by Chinese officials from discussing his treatment behind bars, Tohti had clearly lost weight, she said. “My family visited on July 7: They told me that he’s gotten skinnier—he lost 40 pounds— and all his hair turned gray,” she told reporters ahead of the awards ceremony. “He wasn’t allowed to say anything,” other than to discuss general topics like “children, studies, and life,” she said. She said she didn’t ex pect the award would worsen an already bad situation because of the life sentence, or anticipate that the government would retaliate against the family. But she said she hoped the award would increase awareness about her father. Chinese authorities could realize the international attention to Tohti’s situation, and “they are scared that their reputation will get ruined,” said Ilham, who is a student at Indiana University in the United States. “Either it will have better effects or maybe no change—they just ignore it—but I don’t think things can get worse.” It could “make people believe that what the Chinese government has been telling people is a lie,” she said, adding that her

broader concern was that outside observers might lose attentiveness to Tohti’s imprisonment long after Tuesday’s prize ceremony. In a statement announcing the award, the rights groups said Tohti has “sought reconciliation by bringing to light repressive Chinese policies and Uyghur grievances. This is information the Chinese government thas sought to keep behind a veil of silence.” The statement used an alternative spelling for Uighur. “He remains a voice of moderation and reconciliation in spite of how he has been treated,” it said. Prevented from publishing, Tohti turned to the Internet, running the site Uyghurbiz.net to foster discussion about the economic, social and developmental issues Uighurs face. Seven of Tohti’s students were also sentenced in what was seen as a move to strengthen the government’s case against him. Authorities accused Tohti and his students of forming a criminal gang that sought to split Xinjiang from China. Tohti’s sentence was one of the harshest handed down to a government critic in recent years and came amid a sweeping crackdown on dissent under President Xi Jinping. AP

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Thursday, October 13, 2016 A13

THE MFT GROUP HAS FOUND THE RIGHT PARTNERS A

By Leony R. Garcia

MERICAN companies, like Google, Facebook and other Silicon Valley startups, have been fueled by millions of funding from venture capital rounds and players, as well as angel investors. Now the same opportunity comes for the sleeping giants in the Philippines as MFT Group of Companies joins in the young age of venture-capital and angel-investing industries to cultivate partnerships, amplify growth and boost regional economy. Today the group boasts diverse line up of projects in different industries under its fold: Compact Pharmaceutical Corp., Meihao Corp., Bloomquest, MFT Entertainment, Haunted Towers Pictures, MRACC Credit Corporation, Tambunting Online, Regina Online Investing, Upstart, 2Puffs California. Cutting across various array of fields, on the pipeline are business ventures with retailing and dealing with equipment, opening up to agriculture and a partnership with a Japanese firm among others in the future. “We are in the business of bouncing back,” Maria Francesca “Mica” Tan, MFT Group of Companies president and CEO, describes her company. MFT Group adheres to the principles of rebuilding structures and backing great ideas to help businesses grow. With experience ranging from end to end of vast and diverse industries, MFT Group founders and mentors draw from individual backgrounds across the globe to provide great framework to help companies rethink the role innovation and support play in business. Apart from infusing capital, MFT focuses on innovation of corporate blueprints in the fields of legal, marketing, taxation and accounting, which are the company’s strengths according to Tan. This is such a gargantuan task for a millennial, who is only 24

years old and who believes making the right decision at the right moment is one of the most important factors for success. Tan admits she fell into the investment business almost accidentally. Fresh out of high school she ventured into small scale angel investing by connecting small business owners in need of capital to her angel group, who could provide it. “Since the early days of my ventures, I would always count on my network of friends, mentors and partners for learning,” she said. “I consider myself lucky for being exposed to many business leaders. I was taught that the leader can tip the balance between success and failure, make something out of nothing and improve a lot of lives while earning the respect of others.” Good partnership, coupled with trust, dedication and focus on a common goal, defines the success of the MFT Group of Companies, which they have been building for the past seven years. “I believe that, to be successful, one always needs other people,” Tan said. She credits her co-founders as one of her main sources of inspiration and support. “The first people who believed in my vision and trusted me are my partners now in MFT Group: CK Agbayani, Luis Cancio Jr. Roxanne Gimenez-Agbayani and Dr. Eric Tan,” she confided.

A lifetime of business preparation

IT wasn’t an overnight business success for the young Tan. She remembers vividly she was a grade schooler when she started having keen interest on building a business of her own. Growing up as the youngest of brood of six children, Tan would be asking her dad how much he made at the end of the day as a practicing medical practitioner. The doting father would be jokingly tell her various figures. But, one time, when he declared zero income for the day, it stuck to Tan’s young mind that becoming a doctor and taking over her father’s cancer center was not for her. “So it has planted the seed in me that business is really the way to go. So I tried to rediscover my roots and found out that, with our Chinese heritage, I had uncles who are willing to mentor me into doing business,” Tan said. With one of her uncles specializing in the pawning industry, Tan had the idea of bringing pawning into a new form through the Tambunting Pawnshop’s online division. At the age of 13, she visited the Philippine Stock Exchange (PSE) office to look for trainings and seminars to teach her the tricks of the trade. Of course, it was only available for graduates. But, luckily, she was introduced to Marita Limlingan, the owner of Regina Capital Development Corp., who took her seriously and walked her through the process of trading. “Every time she goes down to the floor she would allow me to sit beside her which started the mentorship. Then, one day, in a major initial public offering (IPO) bellringing at the PSE, Mrs. Limlingan whispered to my ears ‘Mica, one day you can make that happen’ ” “Those words ring in my ears to this day. I cherish that inspiration and I look forward to the day that

THE MFT Trade Fair Ribbon-cutting spearheaded by Sen. Grace Poe, MFT Group CEO Maria Francesca Tan, Feng-Shui Master Marites Allen and MFT Group Board of Directors on September 17 at the Alphaland City Club.

MFT Group of Companies will go public,” Tan said. At 15, Mica said she was trading foreign exchange (forex) and getting mentorship from renowned investor Mark So. She said her trading experiences were among the major turning points in her life. She was active in stock and currency trading until she turned 18. She decided that Fordham University would be the best school for her following the roster of their successful entrepreneur graduates. But after getting admitted, she decided against it believing that “life would be my university, the world would be my campus.”

Pan-Asia angel investing model

ACCORDING to Tan, MFT offers tailor-made funding, combined with angel investing. Moreover, operations involve active coaching of early stage ventures and very efficient management teams that push corporation toward sustainable profitability and growth. MFT Group of Companies always takes a majority or controlling share of a company it acquires or helps bounce back. “We sit down with these companies to get to the root of their problem and figure how we can help

them get back on track,” Tan said. Currently MFT operates on 80 percent of efforts on mergers and acquisitions and 20 percent of efforts on partnerships with its existing subsidiaries and projects. Ever striving to further hone its expertise in the business, the group will be hosting an angel investing confluence on November where they will be bringing in Silicon Valley and Pan-Asia start-up veteran Jordan Green to mentor the group and its partners.

Living the millennial dream

A SELF-CONFESSED workaholic, Tan said she doesn’t dream of success, but works for it. “I may not be the most experienced or have the most money but I care the most and that pushes me to build great teams,” Tan said This young lady is turning 25 in November and has already mapped the future of her company. “It is MFT Group’s dream to have 100 companies around the world heavily involved in cross boarder investing,” Tan said. “Time is passing, the clock is ticking, the world is racing and I don’t think anyone can wait for us. We cannot ask competitors to wait; and I believe travel in its truest form can develop and enhance

our performance. “The group’s vision is to have an impact on the daily lives of Filipinos, be it in their health, finance, entertainment, lifestyle and retail,” Tan said. Aside from her chief executive role in the MFT Group of Companies, Tan is also the vice president of Tzun An Sek Corp., founding president of the Tulungan Ang Nilalang Foundation Inc., and CEO of MR Angel Credit Corp. She continues to sit in the Boards of a growing number of corporations, both in the Philippines and in international markets. She has also become one of the most-sought after speakers locally and abroad. “There are those who question my wisdom on the certain decisions I made at a young age, but my vision for my fellow Filipinos will always be my prime motive Such decision involves risk, but, if more entrepreneurs and business owner act as custodian of our people’s interests and our country’s welfare we must always strive to promote opportunities - even if it involves risks. In this age of globalization, complacency is not an option I look forward to the support and camaraderie between business owners and the government and how, as a bigger team, we can move forward together.”

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A14 Thursday, October 13, 2016

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Talk is cheap, but impact could be expensive

Senators weigh impact of anti-EU remarks By Butch Fernandez

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@reneacostaBM

ajority and minority senators concede that the country risks economic fallout from President Duterte’s antiEuropean Union (EU) tirades and dismissive attitude toward humanrights issues in his centerpiece war on illegal drugs.

However, they say other factors at play in the overall equation could counterbalance this risk, particularly the possible loss of preferred status of Philippine exports in the EU market, flagged by some quarters. The most optimistic assessment came from Sen. Sherwin T. Gatchalian, who categorically said: “The attacks will not destroy our trade relations with the US and EU. The exports are private-sector driven. The private sector is profit driven.” As long as “there is money to be made, then trade will continue,” Gatchalian, chairman of the energy committee, told the BusinessMirror. Senate Majority Leader Vicente C. Sotto III was more pointed in playing down the issue that was raised recently about the risk that—at its next review of countries covered by the Generalized System of Preferences Plus (GSP+), which gives covered countries extremely low, or even zero tariffs on their exports to EU—the regional bloc of 28 member-countries might

remove such privilege from the Philippines, consequently hurting over 6,800 export items. Sotto’s response to a query from the BusinessMirror: “I don’t think it’s real. It’s more of hype from anti-Duterte people,” referring to the concern about losing what some quarters had estimated as $13 billion worth of trade privileges.

Further export growth stunted

Gatchalian, while upbeat on account of the profit mind-set of businesses universally, nonetheless conceded that the impact of the antiEU tirades could be more on further export growth. “What is detrimental is growing these trade numbers. Obviously, there will be no effort to grow our volume with the EU and US.” Senate Minority Leader Ralph G. Recto, who once served as National Economic and Development Authority (Neda) chief, also voiced concerns over a potential backlash. “The effect may be on investments and trade/exports,” Recto said in a

text message to the BusinessMirror, adding this could be “due to political risk/uncertainty,” as potential investors take a wait-andsee attitude, while existing ones go slow in expanding their stakes in the Philippines until after the policy course becomes very clear. Recto was asked whether he saw a risk that the EU, at its next review of GSP+ beneficiaries (the next bi-annual report comes out early 2017), might exclude the Philippines, using as basis what its monitoring teams might state as the government’s failure to fully comply with core international conventions listed in the EU’s GSP+ program. The GSP+ (or GSPP) covered country’s performance in abiding by these key conventions is an intrinsic part of the review.

No risk before, not today

The Senate minority leader, who, in previous Senate stints, also chaired the economic affairs and the ways and Means committees, replied: “The risk for that to happen is definitely higher. There was no risk before. Zero. There is a risk today.” But Recto’s counterpart in the Senate’s trade and industry committee is way more upbeat. Sen. Juan Miguel F. Zubiri said: “It is too early to say that the statements of the President will have a negative impact on our economy. As a matter of fact, for the period September 2016, approved investments reported by the Board of Investments increased by 193 percent, or P51 billion, compared to just P17 billion last year.” Agreeing with Gatchalian’s

point about other more important factors at play in the overall economic equation, Zubiri pointed out that: “We have strong economic foundations and that is what is important; that is what is crucial for investors to come in.” President Duterte had said recently that the country can do without foreign aid from the EU and the US, if that’s the price of continuing the course of his antidrug campaign. He said, in reply to public comments by Vice President Maria Leonor G. Robredo about the tremendous benefits of official development assistance (ODA), the “future of a drug-free generation cannot be traded with the promise of foreign aid.” He added that the EU—and critics United States and the United Nations—should understand what he is trying to do, since they are also fighting illicit drugs. Mr. Duterte also played down the real worth of US military aid, adding that, while he was not exactly contemplating on revoking existing defense agreements with the longtime ally, he wanted the defense and military brass to source hardware from other countries, singling out Russia among the most enthusiastic ones in making offers.

Fallout on trade

Some quarters, however, are raising another potential fallout from his continuing tirades against the EU, the US and even the UN. Specifically, they flag the economic price of, say, a non-EU renewal of the GSP+ status of the Philippines because of President Duterte’s remarks on human rights, which the EU just might consider as a government policy. Under the GSP+ program, the preferential status enjoyed by a country may be suspended or terminated if its government is shown to violate core human-rights and/or labor-rights conventions. The impact of nonrenewal of GSP+ status—should it happen— according to lawyer-writer Mel Sta. Ana in an article in InterAksyon.com,

The effect may be on investments and trade/exports due to political risk/uncertainty.”—Recto is this: “6,800 Philippine products [processed fruit, coconut oil, footwear, fish, textiles, etc.] will enter Europe subject to huge amounts of tariffs, whereas with the GSP+ status, tariffs are greatly reduced, if not eliminated altogether. The tariff-privilege loss could then set off a chain of adverse events for various sectors: increased expense on the part of Philippine exporters, “who will pay entry charges and taxes collectively amounting to millions of dollars.” It was also noted money previously available and used to answer for salaries, employee-benefits, government-mandated contributions, supplier-bills, overseas-transport expenses, local taxes and other costs of production will be considerably reduced. Moreover, exporters may be constrained not to fill up orders, depriving local suppliers of muchneeded business. This, he warns, will mean less exports and, thus, less income for the exporters and the country, resulting in likely layoffs of workers in order to survive the adverse economic impact of the reduction in business. At the same time, the Department of Trade and Industry (DTI), which conducted a series of briefings in key cities when the Philippines was included along with 13 other countries (the Philippines was first in Asean to be covered), in the GSP+ in December 2014, explained in its web site the significance of such: Philippine producers can now export more than 6,000 products to any of the 28 member-countries of the EU at zero tariff using the GSP+. The DTI listed key products “that may avail of the duty-free access include coconut and marine products, processed fruit, prepared food, animal and vegetable fats and oils, textiles, garments,

headwear, footwear, furniture, umbrellas and chemicals.” The DTI has since been helping exporters understand how to avail themselves of the EU-GSP+ as the tariffs go down. The agency’s effort is mainly focused on helping Philippine businesses “navigate the rules of origin requirements and hurdle other barriers, like product standards,” Trade Assistant Secretary Ceferino S. Rodolfo Jr. earlier told exporters in Davao City.

What can be done

Both majority and minority senators inter viewed concede that it will be difficult to change the style of the President, but the minority, nonetheless, said his key advisers should never stop trying to persuade him to be more circumspect. Zubiri said: “We cannot change the character of the President, as that is his style of management.” He put the ball in the lawmakers’ court: “What Congress can do is to fast-track its economic agenda. The Ledac [Legislative-Executive Development Advisory Council] should meet more often and clusters must be vigorous in discussing the issues.” It would do the country good, as well, Zubiri added, “if the President’s communications team will be more coordinated in responding to issues. Another is for all departments to deliver the reform and development that the President and his team promised his people at soonest possible time.” Recto was firmer in putting the burden on Mr. Duterte’s advisers, saying, “The President’s men should tell truth to power. That cursing, disrespectful remarks to heads of state and policy uncertainty on both domestic and foreign affairs may have economic implications.”

Travelers need not worry about fuel surcharge for now–expert By Lorenz S. Marasigan @lorenzmarasigan

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he upward adjustment of jet-fuel prices in the world market may “threaten” the relatively low airfares in the Philippines, an aviation expert predicted, although a price shock is highly unlikely. Avelino L. Zapanta, an industry pundit, predicts that despite increases in average jetfuel prices this month, the government will not resort to the reimposition of the fuel-surcharge component for airfare. “It is ominous, but it’s too early to tell,” he told the BusinessMirror. Passengers have been enjoying lower fares since early 2015, when the regulator decided to scrap off the fuel-surcharge component from airline fares due to the declining prices of jet fuel in the international market. A fuel surcharge is a temporary relief granted to airlines to help them recover losses incurred from higher jet-fuel prices. It ranges from P500 to as high as P15,000, depending on the destination. Fuel prices have fallen, as the Organization of Petroleum Exporting Countries (Opec) earlier decided to maintain current production levels despite a glut in the market, with an estimated oversupply of 1.5 million to 2 million barrels daily. Fuel accounts for as much as 60 percent of an airline’s operating cost per passenger, and is the second-highest expense next to labor. But the Opec permanent intergovernmental organization of 14 oil-exporting developing nations has recently announced that its members have agreed to a production target of 32.5 million to 33 million barrels per day (bpd) “to accelerate the ongoing drawdown of the stock overhang and bring...rebalancing forward.” The target implies a production cut of between 240,000 bpd and 740,000 bpd from August levels. This would be the first agreed cut

since 2008, and it indicates a slightly greater propensity to cooperate between Opec’s members to support prices. This resulted in an 11.5-percent increase in average jet-fuel prices today. Data collected from the International Air Transport Association (Iata) showed that as of October 7, a barrel of jet fuel costs about $62.3, which translated to an 11.5-percent adjustment from a month ago, and almost flat against last year. “I don’t see Opec being able to sustain price increases because demand may not drastically rise. Major consumers like the US and Russia have much reserves. As such, I don’t see the recent price adjustments to translate to meaningful fare increases,” Zapanta said. The Philippines is one of the countries with the fastest-growing commercial-aviation industries in the Asean. In fact, it is poised to become the third fastestgrowing market in Southeast Asia, as its economy continues to grow in mid single digits. “Demand has grown, boosted by a surging economy,” aviation think tank Centre for Asia Pacific Aviation (Capa) said in a report. “Growth in the Philippines will likely again be in the high single digits—or even, perhaps, the low double digits—in 2016. It was the fourth fastest-growing market in Southeast Asia, but could be the third fastest-growing in 2016 as growth in Cambodia slows.” Airline profitability has also improved, as there are now only three main local players. But infrastructure constraints will likely limit the growth projections, especially since the Ninoy Aquino International Airport (Naia) has reached overcapacity in terms of terminal usage. Last year saw the Naia’s four terminals reaching past their maximum-rated capacity for the first time—as more and more international and domestic flights were launched throughout the year despite the

lack of capacity building projects for the air hub. Data collected by the Manila International Airport Authority showed that the airport handled 36.68 million passengers last year, 7 percent higher than the 34.09 million passengers the year prior. Broken down, the airport handled 19.51 million domestic passengers last year— around 2 million higher than the 17.17 million it served in 2014. International passenger count was almost flat. The Duterte administration has been implementing initiatives to decongest the main gateway, starting with its bid to move some domestic flights to Clark International Airport, and the ban on general aviation in Naia. This resulted in higher punctuality records. In the past only 4 of 10 planes take off and land on time. Today, on-time flight arrivals are at 72 percent, data from the Manila International Airport Authority showed. It is also looking to redevelop the decades-old facility, concurrent with its thrust to build a new airport outside Manila. The government is open to accepting unsolicited proposals from the private sector. San Miguel Corp. is keen on reviving its proposal to construct a new airport that will replace Naia in the long run. Under the $10-billion proposal, the concessionaire will construct a 1,600-hectare international gateway somewhere in the south of Metro Manila. The airport, which would have doubled the capacity of Naia, would have included the construction of a low-cost carrier terminal, a train system and a dedicated tollway. Solar Group-backed All-Asia Resources and Reclamation Corp., meanwhile, proposes to develop the Philippine Air Force’s Danilo Atienza Airbase and reclaim a portion of Manila Bay to construct a world-class international airport that would ease the congestion at Naia.

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DA, DOH agree to revert regulation of processed-meat products to NMIS

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By Jasper Emmanuel Y. Arcalas

@jearcalas

draft executive order (EO) deferring the implementation of an administrative circular that transferred the regulation of processed meat products to the Department of Health (DOH) awaits the signature of President Duterte.

Beata Humilda O. Obsioma, officer in charge of the National Meat Inspection Service (NMIS), said the draft EO was received by the Office of the President on September 30. “The President needs to issue an EO transferring again the au-

thority of processing permits to NMIS from the DOH,” Obsioma told reporters during a roundtable on Wednesday. The draft EO, which was prepared by Agriculture Secretary Emmanuel F. Piñol and Health

Secretary Paulyn Ubial, sought the suspension of Joint Administrative Circular (JAC) 2 released on June 29. The circular transferred the supervision and regulation of processed and prepackaged meat products from the NMIS to the Food and Drug Administration (FDA) under the DOH. “Section 15 of Republic Act [R A] 10611 stipulates that the Department of Agriculture shall be principally responsible for the food safety in the primary production and postharvest stages of food supply chain and foods locally produced or imported in the category, and the DOH shall be responsible for the safety of processed and prepackaged food, food locally produced or imported under the category,” the draft EO read.

JAC 2 The directive that allowed the FDA to oversee the regulation of processedmeat products

“There is a need to temporarily stay the implementation of JAC 2 after due consideration of issues and concerns on the transfer and while RA 10611 will be reviewed and further studied by the Legislative department,” it added. Piñol and Ubial both signed a memorandum endorsing the draft EO to Mr. Duterte. “We respectfully endorse for

approval the attached draft executive order to temporarily stay the implementation of DOH-FDA and DA-NMIS JAC 2 series by the President of the Republic of the Philippines Rodrigo Roa Duterte,” the memo read. “Based on the appeal of the meat- processing sector to defer the implementation of the aforesaid issuance, we find their grounds logical, valid and reasonable,” it added. Obsioma said meat processors belonging to the Philippine Association of Meat Processors Inc. (Pampi) have complained that the FDA is not “competent enough” to ha nd le t he processing of meat permits. “Pampi said the DOH-FDA lacks manpower and the processing of permits take too long, which Secretary Piñol said are reasonable

grounds [to defer implementation of the circular],” she said. In August Piñol said the FDA lacks the expertise to handle the processing and issuance of permits for processed meat. Pampi had complained that companies would incur additional costs if JAC 2 is not rescinded, as they would have to coordinate with two departments to secure permits. On the average, Pampi said companies pay P2,000 to register a product with the NMIS. The group said this amount could go up to P25,000 if the circular is implemented. Pampi said major meat-processing companies have anywhere from 500 to 800 product lines. Permits issued by the government to meat processors assure consumers that their processedmeat products are safe.

Bocaue fireworks store explosion: 2 dead, scores hurt By Ashley Manabat

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Correspondent

OCAUE, Bulacan—A massive explosion in a fireworks store on the MacArthur Highway in Barangay Biñang 1 here on Wednesday left at least 2 person dead and scores injured. According to Senior Insp. Re-

nante Batchine of the Bocaue Fire Department the fatality was charred beyond recognition owing to the ensuing fire that was raised up to the fourth alarm, meaning that firetrucks from nearby towns had to be called in before it was finally declared under control at around noontime. Batc h i ne sa id t he i nju red

were rushed to nearby hospitals, but he could not yet ascertain the exact figure of the wounded because explosions are still being heard, preventing firemen from entering the building as of press time. He said the explosion happened in a fireworks store in the vicinity of a commercial area, but the fire

quickly spread to three other adjoining fireworks stores. The fire chief said a post from one of the stores was strewn about 50 meters from the site of the explosion. Mayor Joni Villanueva-Tugna said the busy MacArthur Highway has to be closed to traffic for some three hours owing to the magnitude of the explosion, which damaged at

least four vehicles—a closed van that was blown away and landed on on its side, a truck that was also blown away, a jeepney that sustained significant fire damage and a Hyundai Starex van that was also gutted by fire—to be scattered on the highway. However, Tugna said at around 12:30 p.m., one lane of the MacAr-

thur Highway was already opened to traffic. The mayor said the explosion was so big that it even affected what she described as “a rice-mill store” across the highway in front of the fireworks stores. She added that around 60-meter radius from the explosion was affected by the blast.

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Thursday, October 13, 2016 A16

CA junks Abalos plea to stop RTCs from hearing electoral-sabotage cases

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By Joel R. San Juan

@jrsanjuan1573

HE Court of Appeals (CA) has junked the petition filed by former Chairman Benjamin Abalos Sr. of the Commission on Elections (Comelec) seeking the dismissal of the electoralsabotage cases filed against him in connection with the alleged irregularities during the 2004 and 2007 elections.

In an eight-page decision written by Associate Justice Zenaida Galapate-Laguilles, the CA’s Tenth Division affirmed the orders issued by Judges Eugenio de la Cruz and Jesus Mupas of the Regional Trial Court (RTC) in Pasay City on March 7, 2012, and March 9, 2012, respectively. De la Cruz and Mupas are the presiding judges of Branches 117 and 112, respectively. In his March 7, 2012, order, de la Cruz dismissed Abalos’s petition to quash the 11 information of electoral sabotage filed against him by a joint committee composed of members of the Department of Justice and the Comelec. On the other hand, in his March 9 order, Mupas denied Abalos motion to quash the two informations of electoral sabotage filed against him by the committee. Abalos is accused of manipulating the senatorial-election results in North Cotabato, purportedly ordering an improbable

“12-0” sweep in the province. In all the said cases, Abalos sought the dismissal on the ground of lack of jurisdiction. He argued that, since the information’s state that he allegedly committed the offenses charged in relation to his office as previous chairman of the Comelec, the jurisdiction over the said cases belong to the jurisdiction of the Sandiganbayan, pursuant to Section 4 of Republic Act (R A) 8249, the law defining the antigraft court’s jurisdiction. Both judges denied Abalos’s contention, saying that the Sandiganbayan Act did not repeal the exclusive original jurisdiction of the RTCs over election offenses as mandated under Section 268 of the Omnibus Election Code (OEC). In affirming the trial court’s decisions, the CA pointed out that under Section 268 of the OEC, RTCs have exclusive jurisdiction to try and decide any criminal action

or proceedings for violation of the code, except those relating to the offense of failure to register or to vote. On the other hand, Section 4 (b) of the Sandiganbayan Act, as amended by RA 8249, which took effect on February 23, 1997, provides that the Sandiganbayan has jurisdiction over “other offenses or felonies whether simple or complexed with other crimes committed by the public officials and employees in relation to their offise. “A contradistinction between the general provision of Section 4 (b) of the Sandiganbayan Act, as amended, and the specific conferment of jurisdiction to the RTCs over election offenses clearly shows that the crime of electoral sabotage falls within the ambit of the RTC’s exclusive jurisdiction,” the CA ruled. It is clear, according to the CA, that under Section 268 of the OEC the RTCs are mandated to try and decide criminal cases involving violations of the OEC, except those relating to the offense of failure to register or failure to vote, which are under the jurisdiction of the metropolitan or municipal trial courts. In addition, the CA did not give merit to Abalos’s argument that the OEC was repealed by the Sandiganbayan Act. The CA said the Supreme Court has ruled in the case of People v Benipayo involving a criminal libel case filed against then-Comelec Chairman Alfredo Benipayo that the broad and general provisions of Section 4 of the Sandiganbayan Act “cannot be construed to have impliedly repealed or even simply modified” the original jurisdiction of the RTCs under OEC. Concurring with the ruling were Associate Justices Mariflor Punzalan Castillo and Florito Macalino.

Army troops, PDEA agents nab Moro drug trafficker By Rene Acosta

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@reneacostaBM

SUSPECTED drug trafficker was arrested by a joint team of the military and Philippine Drug Enforcement Agency (PDEA) in Mindanao, as the Armed Forces has joined the campaign against illegal drugs. Maj. Filemon Tan Jr., Armed Forces Western Mindanao Command spokesman, said the team also seized highpowered firearms from Ismael Matuan Sarip of Lanao del Norte, who was wounded, when he tried to shoot it out with the government antinarcotics against who conducted the buy-bust operation that resulted in his arrest. Tan said the operation was carried out by personnel from the Army’s Fourth Mechanized Battalion and 15th Infantry Battalion and PDEA agents, who seized three sachets of suspected methamphetamine hydrochloride, or shabu, worth P20,000 and another sanchet containing suspected dried marijuana leaves from Sarip. They also recovered from him an M-16A1 rifle, a shotgun, magazines with ammunition, marked money and documents. “The military continues to assist law enforcers in the intensified conduct of operations against illegal drugs,” Tan said.

Earlier, soldiers, along with Moro Islamic Liberation Front (MILF) fighters, collared 53 members of a notorious lawless group involved in peddling illegal drugs in North Cotabato. The operation that was carried out against the group of Madrox Masgal, a notorious drug pusher in North Cotabato, also yielded several high-powered firearms. Masgal is responsible for the deaths of personnel of the 45th Infantry Battalion and Seventh Field Artillery Battalion, and the landmine attack on the members of the 62nd Division Reconnaissance Company. The 53 individuals were arrested during the operation launched on October 5, which was conducted in close coordination with the MILF. The operation against the group also resulted in the recovery of several highpowered firearms belonging to the lawless group, including a homemade barret, an M16 rifle, two homemade M-79 grenade launchers and live rocket-propelled grenades. Tan said the operation was conducted by members of the 602nd Infantry Brigade, PDEA operatives and policemen in the marshy areas of Barangays Nabalawag, Kadingilan, Olamdang, Kadigasan and Tugal, all in Midsayap, North Cotabato.

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Lopez wants to keep ex-MGB head Jasareno as DENR senior executive W

By Jonathan L. Mayuga

@jonlmayuga

hile saying that the ongoing audit of mining operations does not solely rest on a particular individual, Environment Secretary Regina Paz L. Lopez is not just about ready to give up former Mines and Geosciences (MGB) Director Leo L. Jasareno. Unlike other environmental and antimining advocates, the environment chief maintains she trusts Jasareno because of his honesty and integrity. Lopez said she would talk to President Duterte to lobby for Jasareno’s official designation as senior undersecretary of the Department of Environment and Natural Resources (DENR). Jasareno was named by Lopez as senior undersecretary and head of the ongoing mine audit on August 3. “I really like him. He has done his job efficiently and with integrity. I have to talk to the President [about his appointment],” Lopez said.

‘Official appointment’

I r o ni c ally, E n v i r o n m e nt Undersecretar y Mario Luis J.

Jacinto, a Duterte appointee, was the first to make the announcement during Monday’s flag-raising ceremony at the MGB without Lopez’s knowledge. Jacinto was quoted as saying Jasareno no longer has any business with the DENR without an official appointment from Malacañang. He also announced that Duterte has designated lawyer Wilfredo G. Moncano as the new director of the MGB, replacing Jasareno’s job item Director IV. Lopez said she heard about the news of Jasareno being sacked while she was out of the country. President Duterte had earlier called for all appointees of former President Benigno S. Aquino III to vacate their positions. And that includes Jasareno, who has been the

director of the MGB for five years, and was responsible for giving the DENR, then under the leadership of Secretary Ramon J.P. Paje, policy direction in dealing with “irresponsible” mining companies. Under Jasareno’s watch as MGB chief, the DENR suspended Philex Mining Corp.’s copper-gold mine in Tuba and Itogon, Benguet, in 2012. The MGB also recommended to slap Philex with over P1 billion in fine for the accidental leak in the Tailings Pond No. 3 of Philex’s copper-gold mine, the biggest fine ever to be paid by a mining company for causing environmental damage and pollution.

Guidance

Under Lopez’s watch as DENR chief, Jasareno provides Lopez guidance when it comes to legal and technical aspects of mining operations. Environmental and antimining groups, meanwhile, expressed alarm over the sudden change in the leadership of the MGB. Jaybee Garganera, national coordinator of Alyasa Tigil Mina (ATM) said they recognize the prerogative of Mr. Duterte to appoint officials in the DENR that he trusts and believes in. However, he said they are worried that the replacement of asareno without the completion of

the mining audit will be affected. “We call on DENR-MGB to immediately release the official and formal results of the mining audit, explain clearly the next steps and timeline of implementing the recommendations of the mining audit and issue the necessary suspensions as soon as possible,” Garganera said. He also said all former DENR officials must be held accountable for their actions, including the issuance of “midnight mining deals” in the last six months of the Aquino administration and the continued operations of suspended mining projects. “While we appreciate the efforts of Undersecretary Jasareno to lead the mining audit, [but] he must also explain the questionable mining permits, and the inability of the MGB to adequately address mining accidents and complaints,” he said.

Cleansing

Meanwhile, ATM called on Jacinto and Moncano to convene a stakeholders’ meeting to be facilitated by the DENR chief to assess and map out the directions and priorities to address mining issues. Clemente Bautista, national coordinator of Kalikasan-People’s Network for the Environment, said “it is good that Aquino’s ‘top pro-

moter’ of mining liberalization” is out of the audit team. “This will further strengthen the monitoring of mining operation in the country. Aside from cleansing the DENR of corrupt and pro-mining plunder officials, Secretary Lopez should institute radical policy reforms, making mining serves our quest for national industrialization and modernization of our agriculture. Unlike now, it is oriented toward export and private profit,” Bautista said.

COMP’s choice?

The Chamber of Mines of the hilippines (COMP), on the other hand, welcomed Moncano’s reported appointment to the MGB. In a news statement released on Wednesday, COMP, which represents mining industry’s big players, said it “welcomes the appointment of Director IV Wilfredo Moncano, formerly director of MGB-Davao region to the MGB’s top post.” Moncano, the COMP statement said, “officially removes from the official roster of Department of Environment and Natural Resources officials Leo J. Jasareno, whose appointment as senior undersecretary is still pending in Malacañang.” “We are looking forward to working with Director Moncano

and are confident that he will set the proper policy direction needed to boost the industry,” COMP Vice President for Legal and Policy Ronald S. Recidoro said. The chamber also welcomed the statements of Jacinto that it is the MGB’s mandate to encourage growth in investments in the mining industry, which will benefit local communities. “The confidence of Director Jacinto that the industry has the potential to contribute more to the development of far-flung communities and also to the country’s GDP remains a challenge for us in the chamber to strengthen our programs in community development,” Recidoro added. In a report, Jacinto stressed local governments will suffer the brunt of losses if the government suspends “too many mines.” Jacinto went on to cite MGB data, where chamber members contribute a sizable chunk of regional GDP. “Under the strict mandate of the MGB, we are hoping to pour in another $20 billion worth of mining projects into the country’s economy for the next five years. This will have significant positive impact in communities as we implement our social development and management programs,” Recidoro said.

A18 Thursday, October 13, 2016 • Editor: Angel R. Calso

Opinion BusinessMirror

editorial

BusinessMirror: Partnership driven @11

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HE BusinessMirror celebrates its 11th birthday anniversary today. As we mark this milestone, we are proud to note that our brand of journalism is being recognized: The BusinessMirror was cited as the best business news source of the year at the recent 25th Journalism Awards of the Economic Journalists Association of the Philippines. The paper bagged the top prize—considered the “Oscars” of the Philippine journalism industry—with four of its reporters winning the best reporter of the year award in their respective beats.

We have great reasons to celebrate. But we know we can’t sit on our laurels. At a time when the digital age continues to shake up the newspaper industry, we have to do something to arrest diminishing circulation and advertising revenues. Luckily, we have a publisher like T. Anthony C. Cabangon, who knows how to win in an emerging market—the collaborative economy. His words: “You know the number 11—a combination of 1 and 1—signifies partnership. That’s our main focus on our 11th year: Partnerships.” That’s why the BusinessMirror decided to partner with the European Chamber of Commerce of the Philippines in staging last month a well-attended forum on federalism. As our publisher said: “We owe this to our stakeholders. We want big business and industry leaders to know how the Duterte administration’s federalism initiatives will affect the business sector. We don’t want to just be content reporting the news, but also create a newsworthy event that we can bring to our readers firsthand.” He added: “Several groups have also come to us to discuss possible partnerships for this kind of public forum. And the BusinessMirror will not say no to these noble endeavors. The business community and the public, in general, deserve to have these types of forum to get information firsthand from our policy-makers and thought leaders, and also get the chance to air their concerns and ask questions during the open forum. So I’m inviting you, should you wish to use the BusinessMirror as your information vehicle and partner in a public forum like this, I promise you—as the publisher of the BusinessMirror—I will personally meet with you to discuss how we can make our collaboration succeed.” The BusinessMirror has also partnered with Unilab/RiteMed/United Bayanihan Foundation to recognize exceptional civic organizations and seniorcitizen associations that are tirelessly coming up with beneficial programs for the elderly through the annual The Dakilang Adhikain ng Ating Lahi Awards. To supplement the paper’s content with a selection of articles from other news organizations, the BusinessMirror has partnered with global brands such as The New York Times and the Harvard Business Review. We know that each of our partners brings a different set of values, resources and competencies to the table. The challenge for us is to distill these diverse contributions and offer them as a complete set of concepts useful to our readers and advertisers. Our annual offering, Turning Points, is the original year-ahead licensed magazine by The New York Times. It features exclusive content from globally recognized voices who share their perspectives on how our world and our lives may change in the coming year and beyond. The BusinessMirror adds local content to create a bespoke magazine that targets Philippine readers and advertisers. For readers seeking insight on global business trends and guidance on how to live and work better, Business Sense, our weekly offering, provides analysis, ideas and commentary from Harvard Business Review, The Economist and The New York Times. From time to time, the BusinessMirror customizes each publication with original content that resonates with our readers. We know that innovation in the news industry will involve adopting new business models on the wings of advanced technology. And the BusinessMirror must have the flexibility and willingness to embrace new methods that could spell survival. As we respond to new challenges, however, we keep a firm pledge to work tirelessly to make the paper more relevant and attuned to the times, in line with the vision of its late founder—Ambassador Antonio L. Cabangon Chua.

Since 2005

Why the Philippines will prosper John Mangun

OUTSIDE THE BOX

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ver the last month or so, watching the ABS-CBN television show Minute to Win It: Last Man Standing has become part of my evening routine. Of course, that is a terrible confession to make, but we all have our little vices.

We must assume that all in the game are just as eager and dedicated to be the winner. But if you look closely as the game progresses, there are notable differences that become apparent. Some contestants are actually more interested in how they appear before the audience and lose some concentration. Others, in spite of years onstage, seem to be nervous and lose focus. Certainly, dumb luck sometimes determines the outcome, but, usually, it comes down to doing the basics, well as, in most of life.

Guide the tourists

BusinessMirror A broader look at today’s business

Ariel F. Nepomuceno

DECISION TIME

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Whether you accept it or not, the global economic situation is a disaster, and is only going to get worse. If you are listening to the economic pronouncements of the political establishment in the West, that “All is Well”, then you are in trouble. In June the World Bank lowered its 2016 global growth forecast to 2.4 percent, from the 2.9-percent rate projected in January. That is a 17-percent reduction. To put that in perspective, imagine your own company lowering its revenue

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ext to the departments of Foreign Affairs and National Defense, perhaps the tourism department is the most challenged government agency today because of the possible wrong global appreciation of the ongoing war on drugs being relentlessly waged by our government. In the eyes of the world, we could be seen as the Colombia of East Asia during the bloody street-armed encounters between drug lords and government forces during the Madellin cartel’s dominance, where Pablo Escobar virtually controlled his country. The daily body count of the casualties, direct and collateral, would definitely scare those who do not fully understand the real situation on the ground. They will not see that we are far from what Colombia or Mexico were during their worse nightmare in their drug wars. However, we must ensure that the international community, especially those who plan to visit us, correctly perceive the actual conditions in our cities.

No chaos or riots

There is a huge difference. For one, our government has the upper hand in the ongoing campaign against the proliferation of illegal drugs. While the entire security apparatus of the government was surprised by the

magnitude or the extent of the drug menace after President Duterte launched a no-nonsense war on drugs, our law-enforcement agencies immediately gained the momentum. The drug dealers, suppliers, distributors, financiers and protectors are being routed and prosecuted. The government is winning, although it may not be fully accomplished in six months as originally targeted. This is understandable, because the monster was bigger than anticipated. But surely, if the same dedication by our police under the leadership of Gen. Ronald M. dela Rosa is sustained, this war will be won. Another significant difference is the huge popular support by the majority of our people. In spite of some opposition or criticism against the ongoing campaign, the most recent survey conducted by the Social Weather Stations, where the president is shown to be still enjoying a net trust rating of 64 percent, is an indication that the nation is silently

estimate by 17 percent. In the private sector, that would be called a disaster, not as the International Monetary Fund described it as “subdued growth”. If you have ever gotten yourself in a financial hole with too much debt, then you know that debt is a killer. Corporations have much more flexibility than individuals when it comes to debt. A department store, for example, can fire a few employees to improve its gross profitability. If a payment is coming, it can have a sale to raise cash. But ordinary people cannot do that. You can’t fire one of your children to lower your electric bill. Maybe the most important and critical positive for the Philippine economy is the low amount of consumer debt. This may save the country when the global economic situation gets worse—and it will. Philippine household credit, which includes mortgages, auto loans and other forms of consumer credit, is only 6 percent of the country’s GDP—one of the lowest in the world—compared to 10 percent

in Indonesia and an average of 25 percent of GDP in other emerging markets. By comparison, Thailand is in deep trouble right now, as its percentage is 70 percent. Maybe even more decisive is the household debt-to-income percentage. In the US it is 100 percent, meaning people owe as much as they make. Thailand is in deep trouble right now, as its ratio is 120 percent. South Korea, along with Malaysia, is at over 140 percent. Filipino consumers owe an astoundingly small 3 percent of total household income. Manageable debt is supposed to be a basic principle for a successful economy. Too large a debt is simply wrong. Apparently, Filipinos are some of the few people in the world who remember that. The Philippines will survive and thrive in the economic turmoil to come.

approving the said program amid the possible shortcomings or mistakes being committed in the process. The absence of massive street protests or widespread neighborhood riots would imply that disenchantment against the administration, if there’s any, is not as strong. On the contrary, there is a better sense of security nowadays. Hence, the people and the government still own and enjoy our streets.

roam around and enjoy our history. To improve the sense of security of our foreign guests, hire about a hundred blue guards, or even a thousand. Deploy them in the scenic Roxas Boulevard, Mabini area, Cultural Center Complex and other tourist destinations. Build off-site tourist-assistance centers, where professional staff would attend to the concerns of our guests. Ask the cooperation of the private sector and local governments for support and even funds. This is how they do it in Taiwan, South Korea, Hong Kong, Kuala Lumpur, Singapore and many other major cities. Let’s simply emulate them. Or in other words, copy their simple achievements.

Easy and welcome gifts to our tourists and guests

I personally know Undersecretary Cath de Castro and Assistant Secretary Ricky Alegre of the Department of Tourism. I’m glad that Secretary Wanda Corazon T. Teo, who’s also known to be a straight and competent person, agreed to have them in her team. I can vouch that they have the experience, creativity and integrity to greatly improve the performance of this agency. Thus, the first welcome gift that we have is this team. We can expect that they will formulate and pursue sensible projects to improve not only the number of tourist arrivals but, more important, that these tourists enjoy their stay in our country. For example, grant our tourists a pleasant enjoyment of our historic parks, such as the Intramuros. The present agency’s team can make a legacy by ridding this century-old citadel with the informal settlers that are inside the walls. Provide these poor settlers with a decent relocation area immediately. Then bring back this century-old famed destination’s dignity, where tourists can safely

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

Beyond effective campaign messaging

I’m sure the agency will soon come out with a sleek campaign slogan and marketing grand plan that would positively lure tourists to put us on their list. However, we must accept that the more important issue, which is considered an obligation for inviting them to come here, is to be perfectly sure that they will be happy with that decision to see the Philippines. That after they go back to their own countries, they will speak only good words about their experience with us. There are many things that we can accomplish to improve our tourism industry. Infrastructures and accommodations need a serious improvement. But let’s start now with the list of easier gifts that we can give to our visitors when they arrive.

Opinion BusinessMirror

opinion@businessmirror.com.ph

Traffic spoils economic growth

Help is from the Lord Msgr. Sabino A. Vengco Jr.

Alálaong Bagá

Val A. Villanueva

Businesswise

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raffic has gotten worse, with no apparent immediate doable solution in sight. President Duterte anchored his election campaign on the eradication of drugs and alleviating the traffic situation, even pillorying the previous administration for doing nothing to solve these problems.

People believed that he would deliver, and he handily earned the nod of 16 million Filipinos who catapulted him to the presidency. It turned out that he needed more muscle to slay the traffic dragon. He had asked for emergency powers and more time to finally end the “carmageddon.” But even the extra powers he asked could not yet be accommodated due to the failure of his traffic managers to get their act together. The chairman of the House transportation committee, Catanduanes Rep. Cesar V. Sarmiento, after a series of hearings and consultations, even castigated the Department of Transportation (DOTr) “for submitting an ‘incomplete’ report and failing to define the scope of the traffic crisis, and for its apparent confusion on which projects were covered by the measure,” adding that the DOTr seemed to “be confused on the specific powers it needs.” It turned out that the DOTr has already the power to effect changes in the transportation sector, and most of the powers it wants are either included in its existing mandate or already addressed by existing laws. Sarmiento also chided the DOTr for having no reorganization plan and no proposed negotiation procedure for the projects that should be exempted from public bidding. Neither was the department prepared with a list of projects that it wished to be protected from temporary restraining orders or preliminary injunctions issued by the courts, except by the Supreme Court. In the meantime, the car population continues to boom, even as the roads on which vehicles are to traverse get narrower by the day. The sheer number of vehicles competing for road space is constricting the economy. John Forbes, senior advisor of the American Chamber of Commerce of the Philippines, pointed out recently that the rate at which the traffic situation is getting worse may make Metro Manila “uninhabitable within four years.” Such scenario becomes even more frightening when one considers how the traffic menace seems to be getting less attention from the current dispensation, which is wasting valuable time in creating enemies with our traditional allies who have expressed concern about the way President Duterte is executing his war on drugs. Forbes said that if roads and other infrastructure are not upgraded immediately, the traffic mess in the metropolis would likely worsen on the

back of the country’s fast-developing automotive industry.
 “Metro Manila is at risk of becoming uninhabitable as annual new car growth increases to 500,000 by 2020,” he said, adding that “while roads are being improved throughout the country, the National Capital Region urgently needs more limited access roads, especially skyways, and rail.” Consider these: Domestic vehicle sales in 2020 would account for about 8 percent to 10 percent of the projected total sales of 5 million to 6 million units within member-economies of the Association of Southeast Asian Nations.
From 168,000 units sold in 2010, vehicle sales in the country reached 269,000 units in 2014, and were expected to surpass (if they have not already exceeded) industry target of 310,000 units in 2015, according to the Chamber of Automotive Manufacturers of the Philippines Inc. (Campi).
This year, Campi sees vehicle sales reaching a new high of 350,000 units, on its way to 500,000 units by 2020! To top it all, the gridlock plaguing the streets of Metro Manila is costing the Philippines at least P2.4 billion a day, as cited in recent studies conducted by the Japan International Cooperation Agency in conjunction with the National Economic and Development Authority. I’m not a traffic-management expert, but I have been a motorist for more than half of my life. Based on my experience, the traffic nightmare is not just because of limited road space. What really gets my goat are the unruly, undisciplined public-transport drivers, the unnecessary U-turn slots along Edsa, and the token action being taken by the Metropolitan Manila Development Authority and the Philippine National Police-Highway Patrol Group to enforce traffic laws. Maybe it’s worth pondering for the authorities to take over the operations of the public transport system to have better control of the traffic situation. Discipline can easily be enforced if the government itself would own these public utility vehicles. But, more than that, the Duterte administration has to buckle down to work to address pressing problems other than drugs. Duterte himself should rein in his mouth and work well with our traditional allies to chart the country’s future to prosperity. Only then can he proclaim that change indeed has come!

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he Lord is your guardian; He is at your right, guarding your life from all evil (Psalm 121:1-2, 3-4, 5-6, 7-8). God secures the rights of His chosen ones who call out to Him day and night; pray to Him always without becoming weary (Luke 18:1-8).

Whence shall help come? Psalm 121 is a psalm of confidence as one ascends in pilgrimage to Jerusalem. Mountains were seen as inspiring confidence, places of refuge and safety. Reaching up to the heavens, they were thought to be places where the gods dwell. Israel was familiar with this sort of thinking, since their history was filled with momentous events occurring on mountains, and Solomon built the temple on one. So, looking to the mountains for help, the psalmist’s answer to his own question “Whence shall help come?” specifically proclaims his belief that help is “from the Lord” who dwells in Jerusalem—

the mighty God of Israel “who made heaven and earth.” God, described reassuringly as “the guardian of Israel”, is a solicitous protector who will not let His people stumble and who watches day and night (“who does not slumber”); everyone can sleep securely, because the Lord watches. He is said to be at their right hand, the support that is always there on-call, the assistance in time of distress that people will automatically reach out for. He is their “shade” by day from the heat (Isaiah 25:4), and underneath it “they shall flourish as a garden; they shall blossom like the vine” (Hosea 14:7). By night, the shade shall guard them

BloombergView

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By Noah Smith | BloombergView

ox tech writer Timothy B. Lee used to be one of the most ardent techno-optimists. But he’s had a bit of a conversion, of late, and is now on the side of those who think tech progress is slowing. Maybe it was the economist Robert Gordon who convinced him, or maybe years of observing the tech world changed his mind. In any case, Lee now broadly suggests that the inventions of tomorrow won’t be as world-changing as those of yesteryear. The idea that tech will remake our lives, he writes: Has fallen flat in recent years, and I think it’s going to continue failing in the years to come. There are a number of industries—with health care and education being the most important—where there’s an inherent limit on how much value information technology can add. Because in these industries, the main thing you’re buying is relationships to other human beings, and those can’t be automated. Lee illustrates his argument with a chart of prices for various goods and services in the US economy during the past four decades. As the chart below shows, manufactured goods have mostly fallen in price, while college and health care have soared. He reasons that these are difficult industries for technology to disrupt, since they rely so much on human-to-human interaction.

It’s a compelling argument, but I see a number of ways it could potentially be wrong. There’s a case to be made for continued technooptimism. First, Lee’s chart only includes final goods—the things that consumers buy. But there are a vast number of other goods that also use huge amounts of time and resources to create. Economists call these intermediate goods. That category includes parts and components, but also all the back-office services that make the business world run—accounting, payroll, legal services, human resources and the rest. It also includes finance, which is a huge cost both to businesses and to investors. Technology that makes these thing cheaper will make the business world more efficient, just like

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

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he New York Young Republican Club gathered to watch Sunday night’s presidential debate at Madison Square Tavern, near Penn Station. The club opted for a different location than the first debate watch, held next to a gentlemen’s cabaret called Lace. A little advance work can go a long way. People began arriving at the bar’s basement party room around seven o’clock, two hours before the debate. Not all were club members. Crystal and Lindsay, independents

visiting from California, admitted sotto voce they were supporting Hillary Clinton. “Don’t tell anyone,” said Crystal, “but we couldn’t get into the Regal Theater in Union Square,” where the debate would be playing on a big screen. What about the Young Democrats’ party? “We didn’t even bother to try.” They had no trouble getting a table at Madison Square Tavern. Filling a room in Manhattan with Republicans under 40 is nearly as hard as filling a casino in Atlantic City. Beside Crystal and Lindsay sat three women visiting from Norway, who came for the spectacle. Another

from the moon’s perceived harmful effects, from lunar disturbances that cause fever and other ailments. The Lord will guard over you and every moment of your life, without any limitation of time and space.

God answers those who call out to Him

The unjust judge in the gospel is described as fearing neither God nor other human beings. By his own admission, he is not a righteous person or a pious believer who holds in regard the greatest law of love of God and love of neighbor. He is unjust because he does not care to ensure that justice is served to all; he violates by omission his very duty as judge to uphold justice for all, especially for the defenseless and most vulnerable in society. Such is the widow, who is apparently all alone in the world, since there is no one else to push for her case; she is the voiceless one whose only power is faith in justice and persistence. The widow is a bold woman; she will not give up against her adversary and in the face of the indifferent judge. She is persistent in her demand for her right and for a just decision. The standoff must have

been long enough to wear down the judge. He relents, saying with realism that he better give her justice before she herself becomes violent with him. Jesus argues a fortiori: If such a judge can finally vindicate the poor widow, how much more will God vindicate His chosen ones who pray persistently and cry to Him day and night? God will surely answer His faithful ones in His own time. We do not know when, therefore, we need to persevere in praying. Final vindication is assured in the coming of the Son of Man. Alálaong bagá, God is never disinterested or uncaring. It is a matter of timing—God’s speedy time is the opportune time for us, when we are open for the divine grace and ready to benefit from it. Our help is certainly from the Lord. Jesus’ concluding and sobering question is with its own eschatological note that when He comes as the Son of Man to give justice to all, will there be those who have remained in faith, praying persistently for divine compassion? Join me in meditating on the Word of God every Sunday, 5 to 6 a.m. on dwIZ 882, or by audio-streaming on www.dwiz882.com.

Don’t be so sure the big tech breakthroughs are behind us

How young Republican women react to Trump By Francis Barry

Thursday, October 13, 2016 A19

tourist, Svenja from Germany, said the Access Hollywood audiotape of Trump boasting about kissing and grabbing women without their consent had made headlines back home: “We can’t believe that he’s actually a presidential candidate.” As the hour approached, the room became more crowded with actual New York Republicans. Women used similar terms to describe Trump’s comments: Inappropriate. Gross. Disgusting. But only one had changed her mind about voting for him: “I couldn’t forgive that,” said Danielle, who had been a Jeb Bush supporter.

“Really?” asked her friend, Lauren, placing hand over heart in disbelief. She contended that Trump’s groping talk was a distraction from the serious issues facing the country. (“What about the two cops that were shot?” she asked of the two Palm Springs police officers killed on Saturday.) To her, Trump had nothing to apologize for: “I’m sorry, it’s how guys talk.” (Not all guys, she clarified.) Others at the bar said much the same. Besides, they argued, Clinton bullying and smearing the women in her husband’s past was a worse offense than Trump’s words.

Essentially, machine learning allows machines to do your thinking for you. One of the earliest applications was recognizing addresses on envelopes—instead of armies of humans sitting there doing the reading, the process could be accomplished with just one or two humans managing the machine readers.

cheaper steel makes manufacturing cars more efficient. And it’s here, in the realm of white-collar work, where I believe the technologies bow under development have the potential to create huge productivity gains. A lot of effort right now is being poured into machine learning and artificial intelligence, thanks in part to technical advances in the field, and also thanks to the availability of large amounts of data to train machines. In a recent interview with Lee, venture capitalist Marc Andreessen explained why he thinks machine learning is the next transformative technology. Essentially, machine learning allows machines to do your thinking for you. One of the earliest applications was recognizing addresses on envelopes—instead of armies of humans sitting there doing the reading, the process could be accomplished with just one or two humans managing the machine readers. That’s a big productivity improvement. It isn’t hard to imagine fancier versions of that technology taking over many of the tasks we now spend our time and energy on. Machines will evaluate business proposals for banks and other lenders. Machines will scan contractors and take bids. Machines will seek out targets for mergers and acquisitions. Machines will write most of the text of legal briefs. A machine might even write my columns someday. In fact, many of the things that white-collar workers now spend hours on every day will be managed by machines. That

will free up enormous amounts of time—machines don’t have to go to meetings or read e-mails. Technology is fundamentally about saving labor, and most of the labor in the typical white-collar workday consists of thinking. Just as factory tools and vehicles saved physical labor in the Industrial Revolution, smart machines will save more and more mental labor in the Information Revolution. And since machine learning is still in its infancy, at least in terms of applications, it’s a good bet that this part of the Information Revolution isn’t over. Now, one might look at Lee’s graph and say “OK, fine and good, but which of the consumer goods on this graph will get cheaper as a result of all this automation? If the things we want don’t fall in price, who cares?” There are two answers to that. The first is that Lee’s graph only includes the things that people consumed in the 1980s. But as technology frees humans from the work necessary to produce the old things, humans will spend their time creating new things. We just don’t yet know what most of those things will be. Forty years ago video games barely existed —now they’re a major consumption item. Who knows what we’ll desire four decades from now? Of course, there’s also a second possibility—the possibility that many humans might become redundant. If machine learning makes most of us obsolete, we will have to alter the structures of society to redistribute the massive abundance created, in order to make everyone’s leisure time as pleasant as possible. This is the rise-of-the-robots scenario that lots of people are worried about, but it doesn’t have to be a scary thing, if society changes accordingly. But whichever future occurs, it seems likely that the world of whitecollar work is due for some muchneeded disruption. That makes me a little more optimistic than Lee.

Rebecca, wearing a “Hot Chicks Vote Republican” pin: “I think it’s far worse for women to say these things about a woman than a man to say these things. As a woman, you know how important it is to be heard, and if something happens against you sexually, you would expect other women to speak up and protect you.” Kristen, wearing a Buffalo Bills hat and shirt, charged Trump’s critics with being out of touch not only about the way some men talk, but also about the way some women feel. “How did Fifty Shades of Grey sell 80 million copies if women

didn’t want to hear that kind of stuff?” Not her, she made clear. But plenty of others. Yet, she was concerned by Trump’s boast that as a celebrity, he could do anything he wants, including grabbing women’s genitals. “If you can get away with it and that’s your mentality, what do you think you can do as president?” She would still be voting for him. The debate began. Six minutes in, Trump responded to a question about his Access Hollywood comments, saying “Nobody has more respect for women than I do.” The room erupted in laughter.