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$180.33-M speculative money flowed out of PHL in mid-Oct n
By Bianca Cuaresma
N
@BcuaresmaBM
EGATIVE sentiment still hounds the local market, as capital flows continued to bleed out of the country in mid-October this year, data from the Bangko Sentral ng Pilipinas (BSP) showed.
The latest data on the country’s foreign portfolio investments (FPI) showed continued net outflows in the week ending October 14, further eroding the built-up net inflow accumulated earlier this year. Data from October 10 to 14 alone showed a net outflow of $180.33 million, as the volume-investment withdrawals during the period—at $535.62 million—were significantly larger than the money invested in the Philippines—at $355.29 million.
PHiLippines, U.S. still verifying if Chinese left disputed shoal The South China Sea DETAIL AREA
China’s claimed territorial waters
Continued on A2
200 nautical mi. exclusive zone Disputed islands 500 km
CHINA
500 miles
TAIWAN
VIETNAM LAOS
Hanoi
Hainan
THAILAND
Paracels Scarborough Shoal
CAMBODIA Gulf of Thailand
Spratlys
Singapore
INDONESIA
Manila
PHILIPPINES Sulu Sea
Head goes here
MALAYSIA
Kuala Lumpur
South China Sea
BRUNEI MALAYSIA
Celebes Sea
INDONESIA
Source: Maritime Awareness Project, U.S. State Department
Graphic: TNS
T PASSENGER SURGE AT NAIA Passengers bound for the provinces converge at the check-in area of Terminal 3 at the Ninoy Aquino International Airport on Saturday to take advantage of the fourday weekend leading to All Saints’ Day on November 1. The number of passengers at the country’s airports is expected to increase as November 1 approaches. ALYSA SALEN
Maturing debts hound Tacloban biz hit by Yolanda By Elmer V. Recuerdo Correspondent
T
ACLOBAN CITY—Business in this city is already in full swing almost three years after the devastation of Supertyphoon Yolanda (international code name Haiyan), but many businessmen are treading a tightrope of survival because of maturing debts. Establishments are sprouting in different parts of the city, taking advantage of potentials to do business in the city, the regional hub for trade, commerce and education in Eastern Visayas. When two branches of grocery chain Puregold opened in September, hundreds of people waited outside for the stores to admit customers. The same enthusiasm is expected to greet Robinsons, when it opens its second branch in the city soon. The hotel industry is also seeing the business potential, as the number increased from 41 before Yolanda to 73 as of the last count. Tacloban City Mayor Cristina
G. Romualdez credits the boom to the “business-friendly” attitude of the city government. “We are doing our best to eradicate red tape, expedite the approval of business permits and appear business-friendly to investors,” she said in a news conference marking her first 100 days in office. “It is not enough that they see a good feasibility study; they should also see a business-friendly city. Otherwise, they might get turned off,” she said. The city government has created the Tacloban Business Council tasked to create a road map for business expansion in the city. Recently, the city hosted the Tacloban Business Investment Summit, inviting representatives of national and international companies to explore potential areas for investment. One huge potential to do business, Romualdez said, is on the cluster of underdeveloped northern villages of the city, where 15,000 families currently living along high-risk areas will be relocated.
PESO exchange rates n US 48.5150
HE Philippines and the United States are verifying if Chinese coast-guard ships left a disputed shoal after President Duterte reached out to Beijing, allowing Filipino fishermen back to the rich fishing area that China seized in 2012 as tensions spiked in the South China Sea. Defense Secretary Delfin N. Lorenzana said the Philippine coast guard reported Chinese ships have not been sighted at the Scarborough Shoal in the last three days, but he added the report has to be validated. Lorenzana told The Associated Press the Philippine Air Force plans to conduct aerial surveillance of the shoal off the northwestern Philippines as early as Saturday to check the situation. China took effective control of the tiny, uninhabited shoal in 2012, after a tense standoff with Philippine vessels. Since then, Chinese coast-guard ships have been driving Filipino fishermen away from the area, while farther south on the Spratly Islands, See “Shoal,” A2
54% of Filipino workers use mobile phones to telecommute By Lorenz S. Marasigan
Wittig: “Working from a single location the whole week is now a thing of the past for over half of businesspeople in the Philippines.”
@lorenzmarasigan
T This November 23, 2013, file photo shows a tent city for tens of thousands of survivors of Supertyphoon Yolanda, one of the world’s strongest typhoons to make landfall, in Tacloban City. AP/Bullit Marquez
“We have a long way to go,” she said. For 87-year-old Bernardita Valenzuela, a childhood friend of former First Lady Imelda R. Marcos and the city’s information officer, the advantage of Tacloban lies in its strategic location.
“Business is all about location. Tacloban is at the center of the Philippine archipelago. There is no land trip from Manila to Davao that will not pass by Tacloban through the San Juanico Bridge,” she said. Continued on A2
HE Filipino worker is quickly migrating to the digital realm, a study by a multinational company showed, as more and more employees use their mobile phones to book for workspaces to telecommute. A research done by global workplace provider Regus showed more than half, or 54 percent, of Filipinos now report they work outside the main office half the week or more, while 7 percent are relying on apps to find the closest working space available. Lars Wittig, who sits as country manager at Regus Philippines, said with travel bookings, where over a fifth are carried out using apps, almost 1 in 10 global businesspeople reveals he or she uses apps to book workspace.
“We have witnessed this trend, too; there has been a 300-percent year-on-year increase in users of the Regus app. The app enables users to conveniently book meeting rooms, private offices, coworking spaces and business lounges, without the hassle of contracts or signup fees,” he said. Wittig said as more millennials enter the work force and smartphones become ever more ubiquitous in emerging economies, the use of apps to locate workspace is only set to rise. See “Telecommute,” A2
n japan 0.4608 n UK 59.0136 n HK 6.2560 n CHINA 7.1546 n singapore 34.7903 n australia 36.8132 n EU 52.8814 n SAUDI arabia 12.9366
Source: BSP (28 October 2016 )
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A2 Sunday, October 30, 2016
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More companies use net $180.33-M speculative money flowed out of PHL in mid-Oct metering, resulting in higher RE investment Continued from a1
By Lenie Lectura
T
@llectura
HE Department of Energy (DOE) said there is increasing interest in net metering, resulting in more investments in the renewable-energy (RE) sector. “Net metering has paved the way for investments in renewable energy through distribution-utility customers by allowing customers with installed equipment that harnesses either solar, wind or biomass to offset their electricity purchases from their local utility and receive credits for the excess power exported to the grid,” Energy Secretary Alfonso G. Cusi said. The agency, he said, is accelerating efforts to provide consumers with more sustainable energy choices by organizing through its Consumer Welfare and Promotion Office an orientation about the Net Metering Program of the Manila Electric Co. (Meralco) as it observed its 2016 Consumer Welfare Month with the theme “Consumer Protection: A Shared Responsibility.” During the lecture held at the PNOC Theater of the DOE Compound, Meralco’s Program Manager for Renewable Energy Anna Maria Reodica recounted the firstever net-metering customer in the
CUSI: “Net metering has paved the way for investments in renewable energy through distribution-utility customers.”
country with a 5-kilowatt rooftop solar PV system energized by Meralco in November 2013. Since then, net-metering applications have been growing at an exponential rate, expanding from rooftop installations in households to commercial and industrial establishments, such as malls, schools, offices, banks, cold storage and warehouses. Under the net-metering program of the Renewable Energy Law of 2008, consumers with solarpower facilities at home can interconnect to the lines of the Meralco. They can sell to Meralco, or to their distribution utility, the electricity they generate in excess of their consumption. The current net-metering installation has already breached the 2-megawatt capacity with more than 400 customers availing of the program. The Energy Regulatory Commission said 92 percent of these are in the Meralco franchise area.
FPI are more popularly known as “hot” or speculative money because they are easily pulled in and out of the local platforms in the slight change of global and local sentiment. Hot money in the Philippines has been in consistent weekly net outflows since the end of August this year and throughout September. A slight reprieve of a $41.83-million net inflow was seen in the first week of October before slumping back to a net outflow of $180.33 million. The second week of October’s
net outflow was the fourth-largest weekly net outflow for the entire year. Market analysts have earlier warned the country’s political uncertainty under the new administration could set off alarms for international investors and cause them to be more “cautious” in putting their money in Philippine shores. Japan-based Nomura Research, for example, earlier expressed belief on the country’s ability to sustain its strong growth momentum amid global uncertainty due to strong remittance flows and healthy external position.
However, Nomura warned the main risk to the economy is on the investment side. “The main risk to our view stems from domestic politics, specifically an escalation of the campaign against drugs, which could continue to weigh on investor sentiment. We are less concerned with the potential for adverse changes to foreign policy,” Nomura said. International credit watcher Standard & Poor’s (S&P) Global Ratings also earlier said investors are showing signs of worry on local prospects, particularly due to the political rifts and diplomatic shortfalls of the new administra-
tion despite their knowledge that the local economy will continue to sustain its momentum in the coming months. “International investors may be getting worried about potential diplomatic complications and short-term law and order issues on the ground,” the ratings agency said. S&P sees the Philippines growing by 6.5 percent this year, up from their earlier forecast of 6.1 percent. For next year, S&P sees the Philippine economy growing by 6.3 percent and at 6.2 percent for 2018.
Maturing debts hound Tacloban biz hit by Yolanda Continued from a1
Valenzuela said Tacloban’s 250,000 population swells to as many as 900,000 during the day because of students, workers and people who have transactions in the city. “This is a big potential market,” she said. But while new businesses are making a boom in the city, many homegrown businessmen caught by Supertyphoon Yolanda are in a tight fix. Their problem: maturing debts. When Yolanda struck on November 8, 2013, neighborhood minigrocery store owner Lito Esperas had just stocked his store with grocery items meant
for Christmas out of a loan from a credit cooperative. So when the storm blew his store and washed out all its contents, Esperas thought it was the end of all that he worked for. “It was as if my world crumbled. I was deep in debt and I had no other source of income aside from the relief we were receiving from different international organizations,” he said. Through some cash assistance from international organizations like the Tzu Chi Foundation, the US Agency for International Development and other United Nations bodies that did relief and rehabilitation work in Eastern Visayas, Esperas was able to slowly put back his business, now even bigger than before. “I was able to restructure my loan and get additional loans from different government programs. Business is good, but there is that debt that swings like a sword over my neck,” he said. Businessman and local politician Wilson Uy said that, while business is back, it is not yet in full swing. “My estimate is we are only 60 percent of full recovery,” he said. Uy, who is also the president of the Tacloban-Leyte chapter of the Philippine Chamber of Commerce
and Industry, said most businessmen are still in debt. “Economy is moving and there is money flowing in Eastern Visayas because of aid coming from different non-governmental organizations,” he said. Like most businessmen in the city, Uy said he was able to put back his gasoline business through loans. He said his mother company, Pilipinas Shell Petroleum Corp., provided a loan facility for his business. The Department of Trade and Industry also provided a loan program for small business corporations to fund his other businesses. He laments, though, the slow release of funds from the government to help small and medium enterprises. “We are still awaiting intended funds like the P2-billion grant from the German government for microfinancing,” he said, referring to Kreditanstalt für Wiederaufbau (KfW) (Reconstruction Credit Institute) Interest Differential Fund for Reconstruction Assistance on Yolanda. He said through the request of the Department of Finance, the German government has allowed a portion of KfW as a credit-support fund for Yolanda-affected businesses to recover. The Commission on Audit
(COA), though, has recommended the termination of this program and the reversion of the remaining amount to the general fund due to the alleged mismanagement of the fund by its fund manager. The Leyte Chamber of Commerce and Industry has asked the assistance of the Regional Development Council (RDC) to object the COA decision and make representation with the German government and the Department of Finance “to allow the use of the funds as originally intended…as a credit-support fund.” In a letter to RDC, Uy said the COA decision “is a big blow to the local entrepreneurs of Region 8 and the business community as a whole.” “The government has allowed the mismanagement of the fund to the detriment of its intended beneficiaries who are in dire need of muchneeded assistance to rebuild their businesses from the devastation of Yolanda,” he said in his letter. In an interview, Uy said the KfW funds could help local businessmen exit from the high interest they are paying on existing loans through “lesser interest rates or no interest at all” offered by KfW. “It will also help extend the maturity of our loans,” he said.
Shoal… Continued from a1
China went on to construct seven man-made islands despite protests from other claimants. Deputy US Secretary of State Antony Blinken told reporters in Beijing on Saturday China’s withdrawal from Scarborough Shoal, even if it were a product of bilateral talks with Duterte, “would be a positive development” welcomed by Washington. He said it would be consistent with an international arbitration ruling in July that invalidated Beijing’s sweeping territorial claims in the South China Sea. The ruling said both Filipinos and Chinese can fish at the shoal, but China ignored it and its coast guard continued to block Filipino fishermen. Blinken said the US would continue to conduct freedom of navigation exercises in the South China Sea that challenge Beijing’s territorial claims at a time when countries in the region—including those that are not directly involved in the China-Philippine dispute— have signaled “increased demand” for American presence. Duterte has attempted to repair relations with China, but he has also ruffled feathers with the Philippines’s longtime ally by threatening to scale down military ties with the US and hurling in-
Telecommute… Continued from a1
“It follows that Filipino workers are resorting more and more to the Web and to Web apps to find workspace, especially while they travel from meeting to meeting. Whether they access apps via tablet or smartphone, it is likely a younger generation of workers has grown up with the expectation that there
BESTPHILIPPINECITYOzamizCityMayorReynaldoParojinogSr.(left)iscongratulatedby(from left) Interior Secretary Ismael D. Sueño and Sen. Juan Edgardo M. Angara after receiving the award for the Department of Interior and Local Government’s Seal of Good Local Governance. The award was given to the city for getting the highest rating in good financial keeping, disaster preparedness, social protection, business friendliness and competitiveness, environment management, and peace and order. Also witnessing the award is Misamis Occidental Gov. Herminia Ramiro. NONIE REYES sults at President Barack Obama. State Department Spokesman Mark Toner said the US was still assessing reports Chinese boats have left Scarborough Shoal and Filipinos have resumed fishing there. “We hope it is certainly not a temporary measure. We would like it to be a sign that China and the Philippines are moving toward an
agreement on fishing access at Scarborough that would be in accordance with the July 12 arbitral decision,” Toner told reporters in Washington. After visiting Beijing last week, Duterte said without elaborating that Filipino fishermen “may” be able to return to Scarborough after he discussed the territorial rift with Chinese leaders. AP
is an app for every requirement, and will increasingly opt for this solution to find their next work location,” he said. Recently, the information and communications technology industry—led by the Department of Information and Communications Technology and telco players Smart Communications Inc. and Globe Telecom Inc.—proposed to companies to adopt the culture of telecom-
muting, which, in simpler terms, is the method by which an employee does a task away from the office. “The work force is changing and becoming ever more digital and mobile. Working from a single location the whole week is now a thing of the past for over half of businesspeople in the Philippines, but workers need to be connected and productive even when they are not in the main office,” he said.
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Sunday, October 30, 2016 A3
Increase in cash volume accelerates
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By Bianca Cuaresma
@BcuaresmaBM
HE growth of the volume of cash circulating in the local economy further accelerated in September amid the central bank’s efforts to siphon off liquidity through its weekly auction facility.
Domestic liquidity—as broadly measured by M3—rose to P8.8 trillion in September this year, registering a growth of 12.6 percent. The month’s liquidity growth is faster compared to the revised 11.9percent growth recorded in August this year. A growing cash supply is beneficial for a growing economy as it gives fuel to productive sectors in the economy to increase the nation’s capacity to grow. However, an excessively fast cash-
supply growth, meanwhile, may stoke inflationary pressures on the country’s real economy. An excessively slow cash-supply growth, on the other hand, may be bad for a nation, especially if it does not provide enough financing to keep productive activities going. Amid the continued acceleration in the pace of money-supply growth, the Bangko Sentral (BSP) gave the assurance that the level of cash-supply growth is still enough to finance the
growing economy. “The continued expansion in M3 affirms the BSP’s assessment that liquidity conditions remain manageable and supportive of noninflationary growth,” the central bank said in a statement. “Consistent with its mandate, the BSP will continue to closely monitor monetary conditions to ensure that overall monetary settings are in line with its price and financial stability objectives,” it added. The continued expansion of do-
mestic liquidity growth during the month was attributed by the central bank to the sustained demand for credit in the country. In a separate report, the BSP said the growth of outstanding loans of banks also registered a slight acceleration, mirroring the movement in the country’s overall cash stream. In particular, the outstanding loans of commercial banks hit 17.7percent growth, from the 17.3 percent seen in August.
PLCPD bats for resilient housing in wake of devastating typhoons By Marvyn N. Benaning Correspondent
L
IBERAL Party Rep. Teddy B. Baguilat Jr. of Ifugao has called for an intensified campaign to establish disaster-resilient communities with adequate housing and social services nationwide. The call comes three weeks before the country commemorates the calamity wreaked by Typhoon Yolanda three years ago. Baguilat reiterated the plea even as only 19,000 of the 200,000 homes destroyed by Yolanda have been completed, for a 9.5-percent accomplishment rating as of March this year. Last week’s onslaught of Typhoon Lawin left more than 60,000 families crammed in evacuation centers in Northern Luzon, includ-
ing some in the Cordilleras, Baguilat’s home region. The latest disaster caused P657 million in damages, with infrastructure sustaining losses valued at P581.9 million. Baguilat noted that typhoons normally batter farming and fishing communities, hitting the poorer sections of the country and compromising food production in the process. With the adverse impact of climate change hitting the country hard, a total of 20 typhoons visit the Philippines annually, many of which have winds with velocities higher than 150 kilometers per hour. Speaking during the “Promoting Sustainable and Resilient Communities: A Multisectoral Policy Conference on Resilient Housing and Human Settlements,” spon-
sored by the Philippine Legislators’ Committee on Population and Development’s (PLCPD), Baguilat said, “There is a need to institutionalize measures in preparation for extreme weather events. This is to guarantee that Filipinos who experience disasters are rehabilitated in safe, secure and sustainable shelters.” “Let us be reminded that the right to adequate housing is a fundamental human right that enables individuals to safeguard their dignity and realize their other basic rights,” Baguilat added. PLCPD has pursued policies that aim to address shelter provision challenges, with Resilient Housing and Human Settlements included in its priority legislative agenda for the17th Congress. PLCPD has been pushing for
the enactment of the Senate Bill 1023, also known as the Resilient Housing and Human Settlements Act of 2016. PLCPD policy conference also comes at a time when fears are being raised that China may renew its bid to acquire up to 2.4 million hectares of land in the Philippines for the production of rice, corn, vegetables and aquaculture ventures. An initial deal for such long-term lease was signed in January 2007, but was eventually ditched as farmers opposed the plan. In 2013 China leased 11,500 square miles of Ukraine, or 3 million hectares of land, in its bid to grow food abroad as Beijing transformed more agricultural land into industrial zones. The land represents 5 percent of Ukraine’s territory.
Baguilat champions the National Land Use Act (NLUA) that he said will resolve the dispute over which should have priority—food security or housing. “There is no debate actually. Both food and shelter are important for our people’s survival if only we carefully plan the use of our resources as a nation and as an ecosystem, and not just at the local government level. But we do need to determine where and which of our 14 million hectares of alienable and disposable lands classified as agricultural would be more suitable for food production or as built-up areas for housing, urban expansion and infrastructure,” he said. Baguilat said that based on the country’s 2-percent growth rate, by the year 2045, 142 million Filipinos
may be fighting for food and water if natural resources were not protected and conserved. A higher population growth rate also implies higher demand for housing. Baguilat added that areas for housing need not come from the remaining 4 million hectares of prime agricultural lands planted to rice and corn across the country. “These 4 million hectares are merely part of the 14 million hectares of the total alienable and disposable lands generally classified as agricultural, meaning not public lands or forest areas. Therefore, it is vital that appropriate land-use planning should be done in the whole country to determine the land allocation for settlements without compromising our remaining rice and corn lands,” he said.
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A4 Sunday, October 30, 2016
Telco introduces several solutions aimed at enhancing bus operations
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By Lorenz S. Marasigan
@lorenzmarasigan
HE largest telecommunications company in the country has introduced a suite of transport solutions that help bus operators comply with regulatory requirements and enhance the country’s urban bus-transport system. The five products that aim to digitize buses in Metro Manila, PLDT Vice President Mitch Locsin said, are designed to benefit bus operators through efficient tracking of their units, onboard security surveillance, monitoring real-time sales through an e-ticketing system and Wi-fi connectivity inside the bus premises for passengers to enjoy. Dubbed as the PLDT SME Nation Smart Bus, the new offering helps answer the need for bus operators to comply with the Land Transportation Franchising and Regulatory Board (LTFRB) circular that requires bus operators to install a global positioning system (GPS) monitoring devices in their vehicles to help track its movements and promote commuter safety. “Our SmartBus Solution Suite offers innovative products that help solve bus operators’ day-to-day problems from security
to keeping their buses in check, while passengers also get to enjoy their trip with the connectivity onboard,” Locsin said. The list of products included in Smart Bus Solution Suite are Smart Biz LTE, Smart Tracker, Smart Cam, Smart Fleet and Smart e-Ticketing. Smart Biz LTE is a product that allows bus companies to provide Wi-fi connectivity to their customers through a carrier-grade device that can connect up to 45 devices at the same time while delivering nonstop LTE speeds. On the other hand, Smart Tracker is a solution that helps bus companies track and monitor their vehicles, which makes dispatching of fleets more efficient. Through the said product, business owners and dispatchers can get text, e-mail and Web alerts when drivers are overspeeding, idle and in emergency situations. It also lets
owners monitor fuel consumption through distance traveled by their units, alerts if ever their units go past a defined geozone. Smart Cam allows owners to view and monitor the situation inside their bu s e s. T h i s g ive s p a s s e n ge r s t h at security of remote surveillance in case of emergencies. The device can also be installed near the bus’s fuel source to prevent gas pilferage. On the other hand, Smart Fleet is a cloudbased solution that helps bus operators perform vehicle-management operations, such as maintenance, dispatching and cashiering, driver data and reports. It helps drivers to reduce vehicle operations and maintenance, which saves on costs. Smart e-Ticketing is a system that automates dispatch scheduling and quotes fares real time. It enables users to manage and monitor admissions and retail from the head office while tracking real-time sales. Travel fare is computed and is printed out with the details for the passenger, and information gets transmitted to the head office in real time. These solutions can be availed in varying packages that suits different needs of bus operators. Operators can choose to combine solutions to design their own plan for low monthly rates. “With these solutions, bus operators can really maximize their operations and save on costs, while giving their passengers greater security and convenience to make traveling through Metro Manila a better and enjoyable experience,” Locsin said.
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Red Cross mobilizes 102 chapters for public safety By Claudeth Mocon-Ciriaco Correspondent
their children in crowded places to avoid health hazards. Meanwhile, the Ninoy Aquino Internation-
N preparation for this year’s commemoration of All Saints Day and All Souls Day, the Philippine Red Cross (PRC) mobilized its 102 chapters and subchapters nationwide starting on Friday to ensure the public’s safety in line with the busy holidays. More than 1,500 PRC volunteers and staff were deployed to 243 cemeteries nationwide. At least 295 first-aid stations have been set up in strategic places. Apart from the first-aid stations, the PRC also set up first-aid posts on main highways, such as North Luzon Expressway, South Luzon Expressway and Tarlac-Pangasinan-La Union Expressway. The PRC also deployed 61 ambulances to rove around major highways. “This is the time of the year when families gather to remember their departed loved ones. So our goal at the Philippine Red Cross is to keep our fellow Filipinos safe at all times and give them the best assistance they need,” PRC Chairman Richard J. Gordon said. In addition, 18 major bus terminals in Metro Manila and Batangas, and five major seaports will also be prioritized to cater to people who are still on their way back to their hometowns. The PRC will also have welfare stations and ambulances on standby to provide assistance in case of mass casualty incidents. And also, the PRC will deploy more volunteers and will set up additional first-aid stations during the whole operation. The PRC advised the public to wear light colored clothing, bring water and avoid consuming alcoholic drinks. Parents with small children are, likewise, advised not to bring
al Airport (Naia) reported on Saturday that it is ready to accommodate the hundreds of thousands of passengers rushing to the provinces to celebrate All Saints’ Day and All Souls’ Day on the first two days of November. The Media Affairs Division (MAD) said the Manila International Airport Authority (Miaa), in cooperation with the Department of Transportation, has launched “Oplan Undas” to ensure the safety of all airline passengers. MAD chief Jess Martinez said information desks manned by the regular airport policemen, Miaa medical staff members and employees of the Public Affairs Office would be on hand to assist passengers. Personnel from the National Police Aviation Security Group, on the other hand, will continuously monitor the airport premises, accompanied by bomb-sniffing dogs and randomly check luggage and cargo as precaution against possible terror threats. For any medical emergency, the Miaa had put up tents and stationed physicians and nurses in different terminals. November 1 (All Saints’ Day) and 2 (All Souls’ Day) are special nonworking holidays. All domestic airlines representatives said they are all ready to accommodate the passengers, adding they also will monitor closely the passengers, as well as their pieces of luggage, so that their motto for the occasion is “No Luggage Will Be Left Behind.” Of major concern is the Naia Terminal 3 because most of the big domestic carriers are based there, such as Cebu Pacific and PAL Express. With Recto L. Mercene
I
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Marcos assails Comelec for ‘brazen defiance’ of SC
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By Joel R. San Juan
@jrsanjuan1573
MOCKERY of the judicial process and a travesty of electoral reforms.
This was how the camp of former Sen. Ferdinand R. Marcos Jr. described the stripping activity conducted by the Commission on Elections (Comelec) on vote-counting machines (VCMs), blatantly defying the order of the Supreme Court, sitting as the Presidential Electoral Tribunal (PET), to preserve and safeguard all election materials and equipment used in the May elections. This developed as some 150 supposedly unused VCMs were found to have installed with corrupted SD cards during the 14hour stripping activity conducted by the Comelec at its warehouse in Santa Rosa City, Laguna. In proceeding with its plan to strip supposedly unused VCMs in view of their release to Smartmatic-TIM, Jose Amor Amorado, counsel for Marcos, said the poll body disregarded the Precautionary Protective Order issued by the PET to preserve all election materials used in the past elections. He also questioned the apparent haste to conduct the stripping of the VCMs by the Comelec, Smart-
matic and the camp of former Liberal Party Rep. Maria Leonor G. Robredo of Camarines Sur as they carried out the activity until 12 midnight on Wednesday. “This is a mockery of the judicial process, which is tantamount to contempt of court and a travesty of electoral reforms, because we are fighting for truth and clean and credible elections. There was undue haste seen as erasing possible evidence. We find it extremely incredible why the Comelec could openly defy such a lawful order of the highest court of the land just to accommodate Smartmatic and appeared to be on a rush to turn over the VCMs, to Smartmatic,” Amorado said. The Comelec earlier decided to grant the request of Smartmatic to recall 1,365 VCMs, which it unilaterally declared to have neither been deployed and/or unused in the May elections. Marcos did not participate in the stripping activity, maintaining that any move to transfer or deal with any election material or equipment must
have the approval of the PET, as it has sole and exclusive jurisdiction over his election protest. The stripping activity started at around 10:30 a.m., which was participated in by representatives from Robredo, Sen. Leila M. de Lima and former Metropolitan Manila Development Authority Chairman Francis N. Tolentino. Smartmatic’s Ellie Moreno was, likewise, present. All boxes with complete parts and empty SD cards were repacked and set for the scheduled turnover to Smartmatic. Those with broken seals or with SD cards found to have data or were corrupted were segregated for safekeeping by the Comelec. Comelec Executive Director Jose M. Tolentino Jr. earlier said the SD cards will not be turned over to Smartmatic. During the stripping activity, at least 150 boxes were segregated because of defects in the seals and presence of data in the SD cards. Some VCMs had missing SD cards. 1,255 VCMs were cleared and were expected to be turned over Smartmatic on Wednesday. The next stripping activity for the remaining VCMs will be on November 2. Later in the afternoon, tension occurred between the camps of Robredo and Tolentino when the latter refused to take part in the activity beyond the
‘Subject Philippines-China deals to scrutiny’ By Marvyn N. Benaning | Correspondent
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ARTY-LIST Rep. Carlos Isagani T. Zarate of Bayan Muna has called for a “thorough, serious due diligence vetting on projects to be undertaken by foreign governments and corporations in the country.” Zarate made the call as reports claimed that some “big-ticket projects” clinched in China during President Duterte’s state visit were allegedly awarded to companies previously involved in a string of accidents in other countries or banned owing to malpractices. Even the Chinese company contracted to do the reclamation for a port in Davao City has been tagged as the conrtractor that undertook the reclamation work for a man-made islands in the Spratlys being claimed by the Philippines. “We must be very careful so as to avoid a repeat of deals, like the Northrail and NBN-ZTE during Gloria Arroyo’s term and the numerous MRT [Metro Rail Transit]-LRT [Light Rail Transit] contracts of the Aquino administration. These deals cost taxpayers billions of pesos, yet, nothing to their benefit came out of it,” Zarate claimed. “Hindi natuloy ang Northrail at NBN-ZTE deal pero
ZARATE: “We must be very careful so as to avoid a repeat of deals like the Northrail and NBN-ZTE during Gloria Arroyo’s term and the numerous MRT-LRT contracts of the Aquino administration. These deals cost taxpayers billions of pesos, yet, nothing to their benefit came out of it.”
nagbayad pa din tayo. Bulok pa din ang MRT at LRT pero nagbabayad pa din tayo,” he said. Among the supposed banned companies include the China Road and Bridge Corp. and the China Harbour Engineering Co. Ltd. Issues were also raised on the supposed undercapacity or underfunding of some of these companies, like the MVP Global Infrastructure Group. “These allegations should be seriously looked into as this may even undermine the administration’s development plan. Hindi na dapat maulit ang mga anomalous deals ng mga nakaraang administrasyon,” Zarate also said.
Africa taps Batingaw as early warning tool
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ATINGAW, the disaster-management mobile application launched in 2014 by the Office of Civil Defense-National Disaster Risk Reduction and Management Council (OCDNDRRMC) and Smart Communications, has been tapped as a tool for building resilience in the Horn of Africa. During a recent trip to the Philippines, representatives of the Intergovernmental Authority on Development (Igad) and the United Nations Development Programme (UNDP) identified Batingaw as an innovative tool that can help strengthen early warning systems in the African region. Through south-south cooperation facilitated by UNDP Regional Center for Africa and the Philippine Embassy in Nairobi, Kenya, Batingaw’s developer, Vincent Loremia, has been invited to travel to Nairobi to work with the Igad team in developing a similar app for the Horn of Africa. A Tagalog word for “bell,” Batingaw is a mobile application that provides government agencies, organizations and individuals immediate access to disaster warnings, advisories, location data and disaster mapping. It features step-by-step instructions that can guide users to safety during disasters. The app also enables users to contribute information to emergency agencies more easily and quickly. Batingaw was designed to run on smartphones and other mobile devices. It can be downloaded for
free from Google Play for Android devices and from iTunes for devices running on iOS. In his letter to Loremia, Guleid Artan, Igad Climate Prediction & Applications Centre (Icpac) director, said Batingaw “could be the basis for the development of a similar innovative application for the Horn of Africa... we are confident that such an innovative tool would have practical use and will support our effort in building resilience in the region.” “The Batingaw app was designed to empower ordinary people to do their part in sharing accurate, on-ground information during disasters using the most ubiquitous tools of today—the mobile phone. Through this app, we hope to connect community stakeholders—government, response teams and ordinary citizens—to a wealth of information that could promote safety and help save lives,” said Loremia, cofounder of Tudlo Innovations Solutions, the team behind Batingaw and one of Smart’s partner start-ups. “With the increasing intensity and frequency of disasters, tools that strengthen public awareness and facilitate a system for preparedness and response, have become more useful. We are honored to be part of this initiative that will pave the way for Philippine innovation and best practices to be recognized internationally,” said Ramon R. Isberto, Smart Public Affairs head.
initially scheduled 5 p.m. deadline. However, Robredo’s lawyer, Beng Sardillo, insisted that work be continued until 12 midnight to enable them to finish all the 1,356 VCMs. When Tolentino’s lawyer, Ben Mabulac, strongly opposed the motion since most of their supervisors were college students and needed to go home at the allotted time, Sardillo suggested that they all leave the warehouse and just let the Comelec and Smartmatic do the stripping activity to enable them to finish all VCMs in one day. This was again strongly opposed by Mabulac, saying her suggestion is highly irregular. The issue was settled, Comelec Commissioner Christian Robert S. Lim called to them to proceed with the stripping until 12 midnight to “maximize the time.” Amorado said the presence of corrupted SD cards when they are supposedly not have been deployed or used is proof that the Comelec should not have decided to release the VCMs in the first place. “Prudence would have dictated the Comelec to wait for the PET resolution on our motion, but they did the exact opposite and even conducted the stripping activity in haste with so many violations and irregularities. We really find it highly irregular, if not criminal,” Amorado stated.
Sunday, October 30, 2016 A5
Sen. Gordon misinformed on dengue vaccines—Garin
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ORMER Health Secretary Janette L. Garin assailed Sen. Richard J. Gordon “for being misinformed ” about the P3.5-billion antidengue vaccination project that benefitted about 500,000 schoolchildren. “What I heard is his office was misinformed [about the dengue vaccination]. I understand, of course, but it should be corrected. It should be constructive criticism and be based on scientific and reliable data,” Garin told reporters. Garin answered allegations made by Gordon during last week’s Department of Health budget hearing, during which the senator threatened to open a Senate investigation about the dengue vaccine. He gave remarks about corruption and even compared the student-beneficiaries to “guinea pigs”. “If you are talking about corruption on the dengue vaccine [acquisition]...[the supplier is] a multinational company, any cloud lang diyan na may corruption, lahat sila tanggal sa trabaho. Global sila. Ganyan katindi [ang] compliance nila,” Garin said. “It’s unfair for them that people are throwing [corruption] accusations. We got the lowest price among all the countries. It’s also because of Apec [Asia-Pacific Economic Cooperation] and nag-insist tayo,” Garin added. When asked about the “guinea pig” remark, Garin said Gordon may have mixed past issues to the present that paved way for his misconceptions to the current topic. “There was really an experiment that was done [but] not during my
It’s unfair for them that people are throwing [corruption] accusations. We got the lowest price among all the countries. It’s also because of Apec [Asia-Pacific Economic Cooperation] and nag-insist tayo.”—Garin
time. The administrations before me claimed that they have discovered a medicine for dengue. But it was not done scientifically,” Garin said. “Iyong sinasabing gamot is an alleged ‘miracle drug’, which was not true and was not allowed by the FDA [Food and Drug Administration]. Kasi iyon ang totoo...na gumamit sila ng guinea pigs. Na-mix ang information. “For me, as a doctor, my conscience can’t stand it [using people as guinea pigs],” Garin said.
Jae Denise Adolfo
A6 Sunday, October 30, 2016 • Editor: Angel R. Calso
Opinion BusinessMirror
Stronger collaboration for greater energy access in Asia Pacific
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By Dr. Shamshad Akhtar | Inter Press Service
ANGKOK, Thailand—The emergence of new ideas, technological advancements and innovative market-driven financing solutions has lent confidence to the idea that universal access to energy services is attainable. This is particularly good news in the Asia and the Pacific region where, despite making significant contributions to global growth and poverty reduction since 2000, nearly half a billion citizens still have no access to modern energy, principally in rural and far-flung areas. Three-quarters of these people live in South Asia alone. Some 70 percent of the Pacific island households are unelectrified, a level similar to sub-Saharan Africa. The lack of electricity and clean cooking options marginalizes predominantly remote and slum communities who are trapped in energy poverty, preventing them from stepping on the first rung of the ladder to prosperity. There is a range of approaches, options and sources that, if effectively exploited, can help Asia Pacific broaden energy access. One of the game-changing elements for energy access is Asia’s emergence as producer and provider of renewable-energy (RE) technology, with investment in renewables reaching $160 billion in 2015, or over half the global total. RE options are poised to reshape the energy-access challenge. In particular, solar power with its low-cost advantages and widespread applicability will pay a major role, as it offers both grid-based centralized solutions, as well as decentralized applications, such as solar lanterns, solar home systems and solarpowered minigrids. This year three large-scale solar proposals in the Middle East and South America have contracted their solar-generated power for United States three cents per kilowatt-hour, which is cheaper than any other source of energy. The marketability of solar energy further benefits from technological advancements in energy storage, driven by utility power and electric vehicle markets. These developments will have positive spillover on the energy-access sector. In many countries of Asia and the Pacific, the decentralized power option offers lower costs than extending the grid into remote locations, which influences long-term energy planning scenarios of countries. These options include minigrids, hybrid systems, biogas and micro-hydro power, depending on costs, local geography and resource availability. Reliability and scalability require an enhanced role of the private sector to find the most suitable local energy-access solutions and to mobilize innovative finance and business models. Energy access solution providers already promote creative solutions, however the private sector’s role in the provision of energy access has been limited, accounting for only 18 percent of total investment. To bring private capital, technology and expertise to energy access, partnerships between public sector and multilateral financing agencies need to offer the right enabling policy environment and a combination of incentives, including risk mitigation frameworks, loan guarantees and other supportive credit enhancements. The potential of private investment in the promoting energy access should not be underestimated. The so-called bottom of the pyramid energy users currently spend $37 billion on energy services, such as kerosene, batteries or candles, which are often inefficient and more costly than clean alternatives. Many pioneering private-sector firms have developed low-cost energy systems at household or village scale, such as solar lanterns, biogas or microhydro systems, and are rolling out business models with product, process and distribution innovations. Across the Asia Pacific, rural microcredit is funding energy access, including Bangladesh’s Grameen Shakti, which has funded half a million solar home systems. Development of indigenous technology capacity in Nepal has lowered equipment costs for biogas and microhydro systems. India has leveraged public-private partnerships in its rural electrification efforts, bringing electricity to 32 million households over the last decade. Local provision of energy can have a catalytic effect, leading to economic growth and increased demand for other products and services that can be met by these companies, leading to growing business opportunities.
The Vietnam body-count syndrome B Y body count, I mean the number of people killed, wounded, captured and surrendered that has been exploited by misguided politicians, the police and military and some irresponsible members of the media to measure the success of the government’s intensified antidrug campaign.
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By Cecilio T. Arillo
In fact, there are too many tangible and intangible variables that cannot be measured by way of a mathematical quantification, like lost morale and ethics; families destroyed; how crimes are committed; how bad prisons breed crimes; greedy and ambitious politicians resorting to criminal activities; and the damage to the country’s social, moral and ethical foundation, to cite only a few. Besides, a bunch of anti-Duterte group has already come up with an unqualified generalization of people killed in the antidrug war and labeled them as victims of “extrajudicial killings”, a clever propaganda hyperbole designed to erode President Duterte’s success in regaining the streets from drug lords, pushers and addicts. Take the experience of Vietnam when some misguided politicians and military generals resorted to body count (number of enemies killed) that merely misled them into believing that the US was winning the war in Vietnam. “Body count. That’s one of the more grisly aspects of the Vietnam War that the US military can’t seem to shed, no matter how hard it tries,” said the late Harry G. Summers Jr., the respected military specialist who wrote extensively about the Vietnam War and the Gulf War. Gen. H. Norman Schwarzkopf, the allied commander in the Persian Gulf, has emphatically stated “that as a Vietnam veteran, he abhors body counts as a measure of military success, that he thinks such statistics are not only meaningless but misleading and that body counts can push junior commanders into a numbers game that compromises their integrity.”
A war of attrition expert recalled that “General Westmoreland of the US rallied to turn the tide and stem the losses suffered in the South by making US involvement more open-ended. He reasoned that US military strength existed primarily in its offensive capabilities because of the nature of US military schooling.”
“Military activity is never directed against material force alone,” emphasized Von Clausewitz, the great war strategist. “‘It is always aimed simultaneously at the moral forces which give it life.’ The difficulty for reporters attempting to discern how the Persian Gulf campaign is progressing is that such moral values can only be perceived by the inner eye, which differs in each person....” A war of attrition expert recalled that “General Westmoreland of the US rallied to turn the tide and stem the losses suffered in the South by making US involvement more openended. He reasoned that US military strength existed primarily in its offensive capabilities because of the nature of US military schooling. His plan was to ‘seize the initiative’ to destroy guerrilla and organized forces of the North [read: search and destroy]. This phase of engagement would require the continued commitment of the US [keep giving us money, soldiers and weapons] and would end when the enemy was thrown on the defensive, exhausted, low on resources and unable to launch, insurgent or organized attacks. [Read: Go on the offense by seeking out enemy forces within South Vietnam, but don’t actually invade North Vietnam.] “Essentially, Westmoreland reasoned that US superiority in
warfare technology and resources would eliminate more bodies than the North could replace. Part of his attrition strategy did also include recruitment strengthening in the South [primarily to discount another body for the North]. American soldiers and technology would advance to wipe out the bulk of the North Vietnamese Army’s [NVA] organized forces and ARVN would be relegated to taking over defensive roles in the South and bolstering recruitment. Attrition was to be supported with heavy firepower and bombing that would, in theory, suppress enemy safeties and hiding spots. “Ultimately, body counts proved to be problematic because of easy manipulation. Leadership would sometimes instruct forces to add innocents and civilians to the days body count. Pure inflating of the numbers reported also occurred. Morevoer, the North was able to control the rate at which they suffered losses by avoiding large scale confrontation by organized forces [which is what the US army excelled at].” Body count had its origin from Baron Antoine Henri Jomini, a Napoleonic military strategist who theorized that war could best be understood in terms of mathematics, in terms of things that can be counted. A military expert said: “The quintessential Jominians during the Vietnam War were Defense Secretary Robert S. McNamara and his coterie of ‘whiz kid’ program analysis number-crunchers, most of whom had probably never heard of Jomini. But they surely embraced his belief that war could be mathematically measured, codified and computerized. And in their quest for numbers to prove we were winning, the body-count syndrome was born.” To reach the writer, e-mail cecilio.arillo@ gmail.com
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Keep an open mind 4 O
KAY you’ve heard options 1 and 2. Yesterday, it was option 3 calling for a unilateral cease-fire. No conditions. Just stop the operations that end up in killings. Tell the drug lords in prison and out: Dismantle your drug laboratories; dismantle your drug networks down to street level. You have three months to do it. Heck, for the sake of UN rapporteurs, make it six months. Go ahead and dispose of existing inventory on the streets. Can’t let that go to waste. Addicts on Twitter would be mortified. There will be no police response, though the police may start taking down names for later consideration.
Free Fire
By Teddy Locsin Jr.
Anyway, the same sort of people will snort the stuff, legal or not, and they are no loss to society. But after three months or six months, there should be no trace of the drug trade. It will have been self-liquidated by the drug dealers and pushers themselves. Or else. There will be no trace of them in or out of prison. This was successfully done by US-backed Latin American regimes in dirty wars against young Leftists wanting change. Intellectuals disappeared without a trace, dying in the most agonizing ways without a peep of protest from the international community, except Spain after Franco, the only civilized—because Catholic—country in Europe. What do you think? Too negative? No positive inducement? Okay. So, option 5.
Option 5 is all of option 4, but throw in unconditional pardons. Remember: Drug lords convicted of murder only killed the competition. Should we be sorry? Everybody goes scot-free—drug lords, pushers, addicts; everybody is back at liberty to find something else to do or nothing. Call it streetlevel retirement. [Or street rehab by leaving well enough alone.] Is that a problem? The West has never deplored street beggars; it finds them charming. Not good enough? Okay, option 6. We do what the past administration did—which is to say we do nothing, except we do not take money from drug lords to get elected. So, a unilateral cease-fire, with drugs lords back in business, but they promise never to contribute to anybody’s political campaign. They
Sunday, October 30, 2016 A7
After three months or six months, there should be no trace of the drug trade. It will have been self-liquidated by the drug dealers and pushers themselves. Or else, there will be no trace of them in or out of prison. will be happy not to do that. If you contribute to one, you only make enemies of the others. Our only legitimate fear of the drug trade is a government elected by it and operating under its dictation. But when you think of it, how much “jueteng” money explains the elected composition of government? I was in Congress. My friends swore to me they never touched “jueteng” money. I believe them. Money does not elect you. Charm does. And we politicians have plenty of that. Finally, option 7.
It’s good to be a big corporation again I
By Justin Fox | Bloomberg View
N the 2000s, a series of academic papers showed that corporate America had become a much less comfortable place for incumbents. Lots of people in corporate America already knew this, but it was helpful to see peer-reviewed evidence: LG Thomas and Richard D’Aveni found big increases in profit volatility among manufacturing companies from 1950 to 2002. Diego Comin and Thomas Philippon found a similar increase in the volatility of sales growth and other metrics. Many other studies delivered comparable results.
It had become the “Age of Temporary Advantage,” or of Hypercompetition, to filch the titles of an article and a book by D’Aveni, a professor at Dartmouth College’s Tuck School of Business. Or, more familiarly, the age of “disruption,” the term popularized by Harvard Business School’s Clayton
Christensen. And it still is, if you read the business press or attend a business conference or come within 100 miles of Silicon Valley. This summer, though, Victor Manuel Bennett and Claudine Madras Gartenberg, professors at Duke University’s Fuqua School of Business and New York University’s Stern
School of Business, respectively, did something interesting. They took the volatility measures from the above papers and a few others, added some of their own, and updated them all. Here’s what they found: We are able to replicate prior results suggesting that from the beginning of our data, through roughly 2000, sustainability of competitive advantage was decreasing steadily. Interestingly, however, we find a pronounced reversal of that pattern after 2000. Here, for example, is what happened to turnover among the top 50 corporations listed on US stock exchanges as ranked by revenue: Turnover in the ranks of the biggest corporations rose and rose until 2000, but has fallen back to 1970s levels since. The charts on profit
and sales volatility in the paper show more of a plateau after 2000 than a steep fall, but, in any case, something changed after 2000. Why did this happen? Bennett and Gartenberg go through a list of possible reasons in the paper, but don’t really pick a favorite. I’ve written about this phenomenon a couple of times before and have found that the explanations fall in three main categories: Regulation. One possibility is that the deregulation of several major industries from the 1970s through the 1990s led to more volatility, and with the end of that deregulatory wave after 2000 things settled down. Another is that the piling on over the years of safety, environmental, land-use and other regulations by federal,
state and local governments has given advantages to big incumbents. Yet another is that by easing up on antitrust enforcement and other efforts to protect smaller businesses from bigger rivals, the government has made life easier for the big guys. Capital markets. The number of publicly traded companies in the US is way down from its 1996 peak. Same goes for the number of initial public offerings. Something seems to have happened—maybe because of regulatory changes, maybe not—to make public financial markets less congenial to newcomers and to corporations in general. And that could be making life easier for the biggest corporations. Technology. The Internet and other technological advances seem
Option 7 is a rejection of all of the above and, following Raffy Alunan’s suggestion, for the United States and the European Union to give asylum to everyone into drugs—makers, dealers, pushers, users, everyone who feels endangered and anxious for their lives. Death-anxiety attack is a human-rights concern. Alunan’s idea partially solves our overpopulation by emigration and cures the stupidity of Filipinos into drugs by the process of eugenic subtraction of the most unproductive elements of our society. Go West. Again, don’t get angry. This is just a thought experiment. I am sure these suggestions do not exhaust better solutions to the drug problem that will also spare us a PR problem with the caring rest of the world. See? Keep an open mind. Keep well.
to be leading to the creation of winner-take-all markets in which that winner becomes really hard to unseat. Think Amazon.com, Apple, Facebook, Google; maybe Microsoft and Netflix, too—these companies aren’t old, but they’re not exactly new anymore either, and they keep gaining ground and striking fear into rivals and potential rivals. I’m guessing it’s elements of all three at work (with the third weighing the heaviest), plus maybe some other factors that no one’s really paying attention to yet. For the moment, though, there’s still a lot of uncertainty, and the most important task seems to be getting the word out that the age of temporary advantage is over. Temporarily, at least.
Want more start-ups? Build a better safety net By Noah Smith Bloomberg View
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ACK in 2012, Daron Acemoglu—an economist I follow and greatly respect—wrote a paper along with James Robinson and Thierry Verdier claiming to explain why Scandinavian countries are (supposedly) less innovative than the United States. Acemoglu et al., theorized that Scandinavia embraces “cuddly capitalism”—a strong safety net that prevents failure—while the US goes in for “cutthroat capitalism.” The do-or-die nature of the American system, they said, causes people to try a lot harder at innovation than their European counterparts. Bloggers were quick to point out that the paper’s entire premise was probably wrong. Scandinavia isn’t, in fact, less innovative than the US. Acemoglu et al., used patents as their measure of innovation, but the volume of patents is more about intellectual-property law than entrepreneurial effort. Broader measures of innovation show that the US and Scandinavian countries are about equal. Acemoglu et al., had constructed
an elaborate theory to explain something that probably never existed. So what was wrong with the theory? In Acemoglu et al.’s model universe, the thing that determines entrepreneurial success isn’t how smart you are, how much risk you can take, how good the business climate is, or how much demand there is in the economy—it’s how hard you try. Effort-based explanations are relatively common in economics and econ punditry, especially among those who lean toward a free-market ideology. I occasionally hear people say that southern Europe is economically worse off than northern Europe, because the former has a weak work ethic. Others claim that welfare makes people lazy. And some economic theories even attribute recessions to a great vacation—a sudden decrease in willingness to work. In a recent Bloomberg View debate, my colleague Tyler Cowen suggested that lower employment levels since
the Great Recession may be caused by more men wanting to stay home and play video games. When it comes to getting a job, the evidence for the effort hypothesis is mixed. Most studies show that the creation of cash-transfer programs doesn’t discourage work, while there is evidence that the US welfare reform in the 1990s did force some people back into the work force. But when it comes to entrepreneurship, there’s another factor that’s probably a lot more important than effort. It’s risk. For a prospective entrepreneur, the choice usually isn’t between starting a business and playing video games—it’s between starting a business and working for someone else. The difference in effort between those two career paths probably isn’t that big. But entrepreneurship is much, much riskier than holding a job. In general, you’re a lot more likely to see your business fail than to be fired. The risk theory of entrepreneurship says that when people already have a
lot of risk, they’re less likely to take on more. This is just because most people are risk-averse—if they’re under threat of losing their job or paying a huge medical bill, they’re probably going to be less willing to gamble all of their savings on starting a company. So if the risk theory is right, a stronger safety net should lead to more entrepreneurial activity, not less. Whatever negative effect public assistance has on effort will be more than canceled out by the greater risk-taking capacity of the poor and unemployed. That’s what the evidence seems to indicate. A 2004 study showed that food stamps make people more likely to open a business. Another study in 2012 demonstrated that giving extended unemployment benefits also makes people more likely to start companies. Now we have yet another piece of evidence. Economists Joshua Gottlieb, Richard Townsend and Ting Xu studied the effects of maternity leave in Canada.
They found that women who had the guaranteed option to return to their jobs after maternity leave were more likely to start businesses. The reduction in risk from having the fallback option made entrepreneurs more willing to take the plunge. That’s the opposite of what an effort-based model would predict. So the data is piling up—at the margin, risk is a lot more important than effort in determining who starts a business. With the US suffering declining entrepreneurship rates, this has big implications for policy. Instead of making American capitalism less cuddly, government should focus on finding ways to limit personal risk. That could include single-payer health care, expanded parental leave and other social safety-net programs. It could also include nudging households to take on less debt, since debt creates risk. But whatever the solution is, making the economy more cutthroat seems likely to hurt the goal of boosting business dynamism.
Are public enterprises necessarily inefficient? K
By Jomo Kwame Sundaram | Inter Press Service
UALA LUMPUR, Malaysia—From the 1980s, various studies purported to portray the public sector as a cesspool of abuse, inefficiency, incompetence and corruption. Books and articles with pejorative titles, such as “vampire state,” “bureaucrats in business” and so on, thus provided the justification for privatization policies. Despite the caricature and exaggeration, there were always undoubted horror stories which could be cited as supposedly representative examples. But similarly, by way of contrast, other experiences show that SOEs can be run quite efficiently, even on commercial bases, confounding the dire predictions of the prophets of public-sector doom.
To be sure, unclear and contradictory objectives—e.g., to simultaneously maximize sales revenue, address disparities, generate employment, etc.—often meant ambiguous performance criteria,
many open to abuse. Often, SOE failure on one criterion (e.g., cost efficiency) was justified on the grounds of fulfilling other objectives (e.g., employment generation). However, the ambiguity of
objectives is not necessarily due to public or state ownership per se. Problems of coordination among various government agencies and interdepartmental rivalries also played a role. Some consequences included ineffective monitoring, inadequate accountability, or alternatively, over-regulation. “Moral hazard” has also been a problem as SOE management’s expected sustained financial support from the government, come what may attributed to weak fiscal discipline or “soft budget constraints.” Often, SOE managements lacked adequate or relevant skills, but were constrained from addressing them expeditiously. But privatization does not automatically solve the problem of lack of managerial skills. Similarly, privatization of SOEs, which are natural
monopolies (e.g., public utilities), will not solve problems of inefficiency due to the monopolistic or monopsonistic nature of the industry or market. Improvements in SOE management must be required by the national political leadership and can be enabled by increased enterprise and administrative autonomy, as well as new incentive systems. Such changes do not require privatization as a prerequisite, but can be achieved by greater decentralization or devolution of administrative authority. Many SOEs enjoyed monopoly or monopsony powers de jure or de facto, often providing cover for inefficiencies and other abuses. Hence, competition and enterprise reorganization—rather than mere changes in ownership status—are more likely to induce greater enterprise
efficiency. Instead of presuming that privatization is the only solution, reformers should consider the variety of modes of enterprise reform, privatization, marketization and other measures as options for improving the public sector. With such an approach, privatization becomes one among several options available to the government for dealing with the undoubted malaise of many public sectors. After all, there may well be instances where privatization offers the superior option (e.g., the Hungarian privatization of retail shops), but this should be the policy conclusion after serious consideration of all options available, rather than the default option it has become in recent decades. Remember that many SOEs were set up precisely because the private sector was believed to be unable or unwilling to
provide certain services or goods. Such arguments may still be relevant in some cases but no longer relevant in other cases and, perhaps, never even true or relevant in yet other cases. Many SOEs have undoubtedly proven to be problematic, often inefficient. However, privatization has not proved to be the universal panacea for the myriad problems of the public sector it was touted to be. In many instances, the problem with an SOE is not due to ownership per se, but rather to the absence of explicit, feasible or achievable objectives, or even to the existence of too many, often contradictory goals. In other cases, the absence of managerial and organizational systems (e.g., flexibility, autonomy) and cultures supportive of such goals and objectives may be the key problem.
A8 | S
Sports
unday, October 30, 2016 mirror_sports@yahoo.com.ph sports@businessmirror.com.ph Editor: Jun Lomibao
BusinessMirror
Indians edge Cubs at Wrigley Field for 2-1 Series lead
Cleveland Indians’ Francisco Lindor (12) and Rajai Davis celebrate after winning Game Three of the Major League Baseball World Series against the Chicago Cubs. AP
BULLISH BULLPEN By Andrew Seligman
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The Associated Press
HICAGO—Cody Allen, Andrew Miller and the Cleveland Indians crashed a Wrigley Field party 71 years in the making. Leave it to that sensational bullpen to silence the Chicago Cubs and their revved-up fans. Allen escaped a ninth-inning jam and the Indians set a major league record with their fifth shutout this postseason, holding off the Cubs, 1-0, on Friday night for a 2-1 lead in the World Series. “As fun of a game as it was to be a part of, that was agonizing because we used so many guys,” Indians Manager Terry Francona said. Pinch-hitter Coco Crisp delivered a run batted in (RBI) single in the seventh off Carl Edwards Jr. And that was all Cleveland needed to win the first Series game at Wrigley since 1945. The crowd began forming beyond the ivycovered walls in the early morning, all pumped for the big day. And fans, some who paid thousands of dollars to pack the seats and nearby rooftops, were roaring after a two-out error by first baseman Mike Napoli helped Chicago put runners on second and third in the ninth. Allen quieted the neighborhood ballpark, striking out co-National League Championship Series (NLCS) Most Valuable Player (MVP) Javier Baez to end it. “We know we’re going to have our hands full to beat these guys, and tonight was a good example,” Francona said. “I mean, that was as close a ballgame as you’re ever going to find, and we found a way to
manage to win that game.” Indians starter Josh Tomlin went 4-2/3 innings with his dad Jerry watching from the stands in a wheelchair just two months after circulatory malformation left him paralyzed from the chest down. Miller, Bryan Shaw and Allen took over. The Cubs have been blanked four times in the last eight games this postseason. Their first 1-0 loss in the World Series since Babe Ruth and the Boston Red Sox beat them in 1918 came on a night when the wind was blowing out. “I actually told Miller we were going to win 1-0 tonight,” Napoli said. “Everything you saw on the TV was the wind was blowing out and there’s going to be a bunch of runs scored.... I turned to him and was like, ‘We’re going to win 1-0 tonight.’” Cleveland now has a chance to take a commanding 3-1 lead with ace Corey Kluber starting Game Four on short rest on Saturday and coming off a dominant performance in the opener. John Lackey pitches for Chicago. Not since they dropped Game Seven against Detroit in 1945 had the Cubs hosted a World Series game. The last time they won one? That was two days earlier when they beat the Tigers in 12 innings. Decades of disappointment and curses gave way to a major league-leading 103 wins and hope for the Cubs that their first championship since 1908 is on the way. But just as they did against the Los Angeles Dodgers in the NLCS, they will have to rally from a 2-1 deficit if they are finally going to win it all. “We have seen good pitching,” Manager Joe Maddon said. “The one component of our team that’s going to blossom over the next couple years is the
SAJULGA, Constantino WIN
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ETS Sajulga gunned down a late eagle then pounced on Aniceto Mandanas’s foldup to snatch the National Golf Association of the Philippines (NGAP) Northern Luzon Regional Golf Championship crown on a closing 70, while Harmie Constantino cruised to a nine-shot romp in women’s play despite a 77 at the Beverly Place Golf Club in Pampanga on Saturday. Sajulga charged back from four shots down with five holes to go with an eagle on the par-5 14th to spike a 35-35 card then watched Mandanas crumble under pressure, dropping four strokes in the last three holes, enabling the rising star from Del Monte to complete a thrilling come-from-behind two-shot victory with an even 213 aggregate. It was a big win for Sajulga, who pulled to within one off Mandanas with a 68 in the second round but fell by four after the latter posted a two-under card after 13 holes in the final round of the 54-hole championship sponsored by the MVP Sports Foundation, Smart, PLDT and MPIC. But the erstwhile leader succumbed to pressure after Sajulga nailed that eagle to move within two again and Mandanas blew it all with bogeys on Nos. 15 and 16 and a double bogey on the closing par-5 hole. He limped with a 41 after a 32, his 73 dropping him instead to second at 215. Rupert Zaragosa finally hit his stride after a so-so 78 and 73 in the first two days, firing a three-under 68 to share third place with
Aidric Chan, who carded a 73, at 219 while Jolo Magcalayo placed fifth at 225 after a 74. Korean Seung Hyeon-back and Gab Manotoc hobbled with identical 76s, while Richnell Albano skied to an 81 as they finished tied for sixth at 230. Constantino, meanwhile, posted her worst round in three days but her 38-39 output still netted her a whopping nine-stroke romp over Kristine Torralba on a 224 total, that included a 72 and 75. Torralba turned in a 73 for a 233, while Nicole Abelar shot a 78 for 238 and finished third in the event organized and conducted by the NGAP and serving as part of the PLDT Group National Amateur Tour.August Cruz shot a 76 for a 235 to emerge the low gross champion in the men’s Group I with Alan Alegre nipping Francis Telan in the countback for runner-up honors after the duo ended up with 238s after identical 79s. Telan, an 11-handicapper, took the net championship with a 216. Ricardo Loyola took the men’s Group II diadem with a 249 after an 82, with Alain Canapi also carding an 82 for second at 253, while Jere Fregil, toting a 13 handicap, bagged the net crown with a 216. Cielo Fregil, a 14 handicapper, shared the spotlight as she captured the Ladies Handicap Open division crown with a net 207 after a 69, repulsing Sam Dizon, a 9-handicapper, who finished with a 210 after a 71. Korean Kwon Tae Yon had a 228 after a 76.
LADY BULLDOGS REMAIN PERFECT
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ACK Daniel Animam delivered huge numbers as reigning two-time champion National University (NU) rout De La Salle, 93-77, to move two wins away from clinching an outright Finals berth in the University Athletic Association of the Philippines Season 79 women’s basketball tournament on Saturday at the Smart Araneta Coliseum. Animam had 25 points, 22 rebounds and four blocks in 32 minutes of play, as the Lady Bulldogs improved to 12-0. Earlier, University of Santo Tomas (UST) boosted its Final Four bid, while eliminating last season’s runner-up Ateneo in the process with a 59-42 win. NU, which also extended its three-year-old perfect run to 44 games, has assured itself of a twice-to-beat bonus in case there is a Final Four. The Lady Archers were very much in the game in the first 10 minutes of play, until the Lady Bulldogs unloaded a 28-point second period to put the game beyond recall. Gemma Miranda (23 points, 13 rebounds) and Afril Bernardino (21 points, 12 boards) also produced double-double numbers for NU.
La Salle absorbed its second straight loss, dropping in a tie with idle University of the East (UE) in second place at 8-3, further tightening the race for the twice-to-beat slot—whether in the Final Four or stepladder format. The Lady Archers will face the Lady Warriors in a vital match on November 5, after a weeklong Halloween break. Camille Claro came through with 21 points, five boards and four assists, while Chay Vergara contributed 13 points, five rebounds and two assists for La Salle. Shanda Anies had 19 points, five rebounds, three steals and two assists, Sofia Felisarta chipped in 13 points and seven boards, while Jhenn Angeles added 10 points for the Tigresses. UST rose to 5-7, as it only trails fourth-running Adamson (5-6) by half-a-game in the race for the remaining semis berth. The Lady Eagles bowed out of contention with their ninth loss in 13 matches, leaving the Lady Falcons and the Tigresses battling for the last slot. Hazelle Yam paced Ateneo with 13 points and nine rebounds, while Aiko Tomita and Kat Guytingco added 10 points apiece.
offensive side. I think what you’re seeing on defense and arm strengths and baserunning abilities, that’s going to be pretty much static. But the part that’s going to keep getting better is what we’re doing at the plate. So this is a great experience for us.” Miller got the final out for Tomlin in the fifth, stranding a runner at second. The American League Championship Series (ALCS) MVP then struck out Dexter Fowler, Kris Bryant and Anthony Rizzo in the sixth. Shaw worked the seventh and exited after Fowler singled with two out in the eighth. Allen fanned Bryant to end the inning. Rizzo opened the ninth with a single and took second on a one-out grounder. Jason Heyward followed with a grounder that Napoli misplayed, but at least the big guy kept the ball in front of him and kept the tying run from scoring. Heyward stole second without a throw before Allen fanned Baez for this sixth save this postseason. Two more wins and the Indians will claim the first championship since 1948. The Cubs still need three more for the first crown in 108 years. “It’s just good chemistry over here and our guys kept their poise,” Crisp said. “Our pitching did a great job, their pitching did a great job over there and that’s what type of series this is going to be, it seems like.” It was quite a scene in and around the ballpark, one generations of long-suffering Cubs fans had never witnessed. They started flooding the streets surrounding Wrigley hours before the gates opened. By midafternoon, the blocks outside the 102-year-old ballpark were a sea of blue. Fans carried “W’’ signs and took selfies near the
famed marquee and statues of the late Harry Caray, Ernie Banks and Ron Santo, cherished figures in Cubs lore who would have loved nothing more than to be part of this. There were red roses near the feet of all three. There were also four green apples on Caray’s statue—three on top of the base and one in his left hand—in a fitting tribute. After all, the famed broadcaster promised after the final game in 1991: “Sure as God made green apples, someday, the Chicago Cubs are going to be in the World Series—and maybe sooner than we think.” But this just wasn’t Chicago’s night.
The Cubs’ Kyle Hendricks, dominant in the clinching NLCS victory over Los Angeles, exited with the bases loaded in the fifth, after he hit Chicago-area product Jason Kipnis. Justin Grimm then got Francisco Lindor to ground into 4-6-3 double play and gave a huge pump of the right fist as the crowd roared.
Lining up
Francona took a risk and had Carlos Santana start
in left field with no designated hitter because he wanted to keep the switch-hitting slugger in the lineup. Santana has played catcher, third and first base in his career. But he had only played one other time in left—and that was for four innings in 2012. This made Santana the first player since 1931 to get his first career start at a position in a World Series game, according to the Elias Sports Bureau.
Murray on the mic
Actor and comedian Bill Murray led the crowd in a rousing version of “Take Me Out To The Ball Game” during the seventh-inning stretch. Murray, a huge Cubs fan, reminded the crowd of 41,703 that it was the last chance to buy beer, and then said they were there to win games rather than drink. He then sang “Take Me Out To The Ball Game” as the cartoon character Daffy Duck.
WESTBROOK DROPS 51 O
KLAHOMA CITY—Tired wasn’t an option for Russell Westbrook on Friday night. The explosive point guard had 51 points in a triple-double and scored the winning points in the Oklahoma City Thunder’s 113-110 overtime victory over the Phoenix Suns on Friday night. He played just over 45 minutes and never slowed down. “You’ve got to want to win,” he said. “Very simple. When you want to win, you don’t think about being tired. To me, being tired is a mind thing. It’s in your mind. You’ve got to go out there and compete at a high level and leave it on the floor.” According to the Thunder, it was the first 50-point triple-double since Kareem Abdul-Jabbar had one in 1975. Westbrook finished with 13 rebounds and 10 assists and took a career-high 44 shots to claim his 38th career triple-double. It was the franchise’s first game without Kevin Durant on the roster since it moved to Oklahoma City in 2008. Durant left in the offseason to play for the Golden State Warriors. In Oklahoma City’s home opener, Westbrook reminded the fans that there’s
still star power in town. Westbrook made a layup to put the Thunder up a point with 7.6 seconds remaining. Phoenix’s Devin Booker missed a layup and Westbrook was fouled. Westbrook scored his 50th and 51st points at the free-throw line, with 3.5 seconds remaining. Booker missed a three-pointer as time expired. Westbrook has 38 career tripledoubles. He scored 39 points in the second half and overtime. T.J. Warren had a career-high 30 points for the Suns. In New York Jeremy Lin had 21 points and just missed a triple-double in his Brooklyn home
debut, while Brook Lopez scored 25, as the Nets got their first victory, 103-94 over Indiana. Lin finished with nine rebounds and nine assists, drawing some delirious cheers the way he briefly did during his run of Linsanity last time he played in New York, with the Knicks in 2012. Sean Kilpatrick hit consecutive threepointers during the decisive fourth-quarter surge as the Nets gave new Coach Kenny Atkinson his first victory, not far from where the Northport native grew up. In New Orleans Kevin Durant scored 30 points and Klay Thompson 28, as Golden State bounced back emphatically from a surprising season-opening loss with a 122-114 win over the Pelicans. After scoring only six points on five shot attempts in the first half, Stephen Curry asserted himself more with an array of inside and deep shots to finish with 23 points, including a momentum-swinging 8-0 run by himself in the third quarter. Durant also had 17 rebounds. In other games, Cleveland held on to win 94-91 at Toronto; Charlotte won 97-91 at Miami; Houston won at Dallas, 106-98; Utah won 96-89 at home to the Los Angeles Lakers, and Detroit beat the visiting Orlando, 108-82. Los Angeles Lakers center Tarik Black (28) fouls Utah Jazz guard Rodney Hood. AP
POCARI ASSERTS MASTERY VS BALIPURE
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OCARI Sweat extended its winning streak to five games as it dismantled BaliPure in four sets, 25-16, 12-25, 25-21, 25-19, to strengthen its bid for a top seed in the semifinals of Shakey’s V-League Season 13 Reinforced Conference on Saturday at the PhilSports Arena in Pasig City. The Lady Warriors asserted their mastery against the Purest Water Defenders with another strong performance versus their rivals. Pocari swept BaliPure in three games of Open Conference. Breanna Mackie once again led the way for Pocari with 23 points on 21 attacks and a pair of blocks. Locals Myla Pablo and Michele Gumabao chipped in 11 and nine markers, respectively. Filipino-American Setter Iris Tolenada paced them with 41 excellent sets. Mackie and the Lady Warriors outdueled BaliPure imports Katherine Morelle, who had 21 points in a losing effort, and setter Kaylee
Manns’s 49 excellent sets went for naught. Pocari, which reigned the Open Conference, is now holding a share of lead with University of Santo Tomas (UST), with identical 5-1 win-loss records. The Lady Warriors’ victory also snapped BaliPure’s four-game winning streak. Already in semis, Pocari and BaliPure will have one more assignment in the last day of the elimination round on Wednesday. The Lady Warriors face the Tigresses in a battle for the top seed, while the Purest Water Defenders dispute the third spot with Coast Guard. Meanwhile, Cignal and Instituto Estetico Manila (IEM) reached the semifinal stage after beating their respective rivals in contrasting fashions in Spikers’Turf Season 2 Reinforced Conference. The HD Spikers, the reigning Reinforced champions, defeated the hapless 100 Plus, 25-19, 25-14, 25-16, to secure the second seed after finishing the elimination round with a 4-1win-loss record.
The IEM Volley Masters, on the other hand, earned the third semis slot after surviving the gritty Army in five sets, 25-17, 25-23, 23-25, 22-25, 15-10. Khenno Franco and Daryl Valenzuela led IEM with 16 and 10 hits, respectively, as the team finished the first round with a 3-2 slate. Army bombed out of the competition after finishing with 1-4 mark. Army’s loss sent Champion Supra (2-2) in the semifinals. Champion Supra will play its last elimination match against the undefeated Air Force (4-0) on Wednesday. Lance Agcaoili
Pocari’s Breanna Lee Mackie (6) soars to score against BaliPure’s Kath Morrell (7). STEPHANIE TUMAMPOS
Elite to pick Belo in bizarre PBA draft
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LACKWATER begins its buildup on Sunday when it adds key additions in its roster, as the Elite try to be relevant in their third season in the Philippine Basketball Association (PBA). Armed with the top-pick selection, both in the regular and special drafts, the Elite are expected to tap former Far Eastern University (FEU) standout Mac Belo in the PBA special draft for Gilas cadets pool. What remains to be seen is who Blackwater Head Coach Leo Isaac will pick in the regular draft, although there are reports that the Elite management is inclined to tap former Ateneo player Raphael Banal to be its top over selection in the PBA Draft on Sunday at the Robinsons Place Manila, which starts at 4 p.m. Fifty-three aspirants are in the official list of the draft, with 43-year old Charley Caluya and Jordan de la Paz being scratched on Friday. Caluya failed in the tests of the two-day Draft Combine, while de la Paz did not show up in the event, which is a requirement for a PBA aspirant. Isaac said there’s zero chance that they will change their mind in picking Belo in the special draft, while Banal was one of the players who impressed him in the Draft Combine. “Simple gumalaw, pero effective. Parang tatay niya,” said Isaac of Banal, son of former PBA forward Joel Banal and played for Hope International University-California after his stint with the Blue Eaglets. The picks for the special draft was already made by the 12 member teams during their marathon board meeting on Thursday, although the results will only be announced on Sunday. Phoenix will pick next and Head Coach Ariel Vanguardia said it will be a toss up between Filipino-Canadian Matthew Wright and Arellano University spitfire Jio Jalalon. But according to various reports, the Fuel Masters have already picked Wright, who will be reunited with Vanguardia. The two had a stint together with the Wesports Malaysia Dragons in Asean Basketball League. Barangay Ginebra San Miguel will pick third, followed by Mahindra, Star, San Miguel, Meralco, NLEX, Rain or Shine, Ginebra again, Alaska and Phoenix. Joel Orellana