Palace: Reforms to propel PSEi to 6,000‐level Category: Top News Published on Thursday, 22 November 2012 20:02 Written by Mia M. Gonzalez / Reporter Malacañang hopes that the Aquino administration’s continued economic reforms, which it said has bolstered the Philippine Stock Exchange index (PSEi) to a record level this week, would help it eventually breach the 6,000‐mark. Palace Spokesman Edwin Lacierda based this hope on factors such as the expected passage of the “sin” tax bill and the proposed 2013 budget this year, and the government’s “determination” to implement economic reforms that have been recognized by credit‐rating agencies and International Monetary Fund Managing Director Christine Lagarde. “With this, we hope that we have shown to the credit‐rating agencies our determination, our resolve to pursue in a consistent manner, our economic reforms. We would hope that the market will see that as a sign and also be a way of breaching the 6,000 [level],” he told a news briefing, in response to questions. Lacierda said the soundness of the Philippines’s fiscal and economic fundamentals is reflected in the strong performance of the PSEi, which recorded a new high of 5,534.18 on Wednesday. “We hope that the trend will still continue. It shows that our fiscal and our economic fundamentals are sound. That’s the reason why we have renewed strength and vibrance in our stock exchange.... The Philippines is an investment oasis in the midst of economic turmoil in the world,” he added. When he rang the bell at the PSE in March to mark the then‐record level of 5,030.58 points reached by the PSEi, President Aquino said he wanted to see the PSEi break the 6,000‐level. http://businessmirror.com.ph/index.php/news/top‐news/3754‐palace‐reforms‐to‐propel‐psei‐to‐6‐000‐ level
Planned merger lifts BPI stocks but downs PNB’s Category: Top News Published on Thursday, 22 November 2012 20:33 Written by Miguel R. Camus / Reporter Gains were tempered for Ayala‐led Bank of the Philippine Islands (BPI) while Lucio Tan’s Philippine National Bank (PNB) closed in the red after a one‐day trading suspension for both banks was lifted on Thursday amid news of their planned “merger.” BPI saw early‐session gains of as much as 6 percent before paring these to 1.75 percent to P90 per share; PNB also rose early in the session by as much as 6 percent before closing down at 3 percent to P81.55 per share. BPI confirmed a published report on Wednesday that it is in talks to acquire a stake in PNB. The merged entity would reportedly create the Philippines’s biggest bank in terms of assets, a status currently held by Henry Sy’s BDO Unibank Inc. Additional but still unconfirmed details were reported on Thursday suggesting that the deal would be in the form of a share‐swap transaction. The benchmark Philippine Stock Exchange index (PSEi) dipped 0.38 percent from its November 21 new high to 5,513.37 also on Thursday. An analyst noted both banks, as well as Lucio Tan’s Allied Banking Corp., which is in the process of merging with PNB, are expected to benefit should the merger push though. April Lee Tan, head of research at COL Financial Group, noted that there was skepticism regarding the value that the merger between PNB and Allied Bank would create for shareholders. “There was this huge question mark on execution. When we looked at ROE [return on equity] of the two banks [PNB and Allied] on a stand‐alone basis, it is below average,” Tan said at the sidelines of the Ejap Economic Forum 2012 in Makati City. “So now you have BPI, which has a track record of successfully acquiring companies and creating synergies. So maybe it [the merger] would actually help PNB and Allied to execute their synergies.” Speaking on the broader banking sector, Tan said market watchers are looking to see whether other large lenders will also turn more aggressive given this latest move by BPI as banking giants did in the past. “The question today is will that trigger more consolidation from the big names?” she added. http://businessmirror.com.ph/index.php/news/top‐news/3758‐planned‐merger‐lifts‐bpi‐stocks‐but‐ downs‐pnb‐s
PHL eyes more cacao, abaca exports to Europe Category: Economy Published on Thursday, 22 November 2012 19:30 Written by Max V. de Leon / Reporter The Philippines could considerably increase its exports of cacao to European chocolate makers with the forging of the proposed Philippines‐Europe free‐trade agreement (FTA), Trade Undersecretary Adrian S. Cristobal said. This, he said, is one of the many benefits that the Philippines is bound to enjoy from the FTA with European Union, which is now the subject of an extensive consultation process with the different stakeholders in the country. “For example, the PIDS [Philippine Institute for Development Studies] study on the impact of a Philippines‐European Union trade agreement on our agricultural sector and the reaction of those affected validate the country’s strategy to increase our competitive advantage in select products such as cacao and abaca,” Cristobal said. At the One Country, One Voice, Dr. Roehlando Briones, PIDS senior research fellow, presented his study entitled “Prospects for a PH‐EU FTA: Agricultural Sector Component.” He said niche products or sectors, including cacao and abaca, are possible sources of economic growth opportunities. Big chocolate producers in Europe and some chocolate producers in the US source a big percentage of their raw materials from Africa. “Bringing us in parity with these cocoa exporters would be a big help to the industry and even accelerate their rapid growth in the future,” Briones said. Dante Muyco of the Chokolate de San Isidro, a Mindanao‐based cacao firm and a representative of the Cacao Industry Development Association of Mindanao, said more countries in Europe are looking at the Philippines as a possible source for cacao. However, he said the industry should have a competitive advantage against other countries like African nations and Indonesia. “We are appealing to the negotiating panel because cacao right now is an emerging export commodity,” Muyco said.
He said Mindanao cacao growers have exported around 500 metric tons valued at around $1.2 million since 2009. The cacao producers expect the growth of the industry to be very fast in the next 10 years, projecting Europe demand to increase to some 100,000 metric tons. http://businessmirror.com.ph/index.php/news/economy/3747‐phl‐eyes‐more‐cacao‐abaca‐exports‐to‐ europe
Turkish traders looking for local trade, investment partners Category: Economy Published on Thursday, 22 November 2012 19:29 Written by Max V. de Leon / Reporter Turkish businessmen are now looking for possible partners in the Philippines for various industries as the two countries seek to increase their exchange of goods and investments. The Philippines recently welcomed a Turkish delegation for a trade and investment forum and business matching session with their Filipino counterparts through the Philippine Chamber of Commerce and Industry (PCCI). Miguel Varela, PCCI president, said the meeting will help establish new markets and alliances, as well as support the growth of both countries’ economies. “We can enhance our relationship in the areas of construction and infrastructure, energy exploration and power generation, agriculture and food, science and technology, health and sanitation,” he said. Ali Ezinc, chairman of the Kayseri Chamber of Commerce, said the Turkish delegates are looking for partners in energy, construction, natural gas, home and office furniture and art decorations. “Turkey is seventh highest in terms of tourist arrivals in the world, the sixth largest economy in Europe and 15th largest economy in the world, and in 2011, its economy reached the $1 trillion status,” Ezinc said. He said more Turkish businessmen are expected to visit the Philippines soon. Lyn Piquero, assistant director of Department of Trade and Industry’s Market Strategy, said export products and services with potential for expansion in Turkey are construction services, personal care products, education services, processed food, electronic and automotive products. Currently, Turkey is the 41st trading partner of the Philippines. Trade between the two countries has been growing at an annual average of 7.8 percent between 2007 and 2011. In 2011 total bilateral trade amounted to $154 million. “There is much potential for trade and investment between Turkey and the Philippines,” Varela said. http://businessmirror.com.ph/index.php/news/economy/3746‐turkish‐traders‐looking‐for‐local‐trade‐ investment‐partners
Iloilo to build P450‐M convention center Category: Regions Published on Thursday, 22 November 2012 19:26 Written by Max V. de Leon / Reporter THE province of Iloilo is set to position itself as the conference capital of Western Visayas with the construction of its own P450‐million convention center. The facility will be put up through contributions from Megaworld Corp., the Office of Sen. Franklin Drilon, and the Department of Tourism (DOT). Drilon, in a statement, said the convention center “will add another feather to Iloilo City’s already colorful cap of glory and that will bestow a new title to the premiere city as the conference hub of Western Visayas and nearby regions.” Megaworld Corp. President Andrew L. Tan, Tourism Secretary Ramon Jimenez, Iloilo City Rep. Jerry Treñas, Iloilo City Mayor Jed Patrick Mabilog, and Drilon will launch the proposed Iloilo City Convention Center Friday, Nov. 23, 2012. “I am envisioning a more progressive Iloilo province in the next two to three years with the establishment of the convention center right at the very heart of the province. Our airport, terminals, piers, as well as the hotels and malls will be one of the busiest in the region once we have built this edifice,” said Drilon. The state‐of‐the‐art convention center will be built on a 1.7‐hectare of lot in the District of Mandurriao donated by the Megaworld Corp. The funds will be sourced from the annual priority development assistance fund of Drilon. Aside from his PDAF, the senator was able to secure funding from the DOT and Tourism Infrastructure and Enterprise Zone Authority budget. “This new edifice is something that we, Ilonggos, will take pride in because of its very unique design that is indeed a testament of our high regard for our rich culture. It will feature the sail of Paraw and the figures of Dinagyang revelry for which Iloilo is widely known,” he added. The construction is expected to begin early next year and be finished by the end of 2014. The convention center is designed by Architect Willy Coscoluella and will hold the best and the most glamorous conferences, exhibitions, and trade fairs among others, said Drilon. http://businessmirror.com.ph/index.php/news/regions/3743‐iloilo‐to‐build‐p450‐m‐convention‐center
Ayala invests in Vietnam infrastructure company Category: Companies Published on Thursday, 22 November 2012 19:15 Written by CONGLOMERATE Ayala Corp. is investing in a Vietnamese infrastructure company as it seeks to widen its presence in an emerging economy that has also drawn the interest of other regional players. A Philippine Stock Exchange filing on Thursday showed that Ayala and Ho Chi Minh City Infrastructure Investment JSC (CII), where Ayala owns a 10‐percent equity interest, have agreed to invest in Vietnam’s VinaPhil Technical Infrastructure Investment JSC. VinaPhil, which will have a start‐up “charter capital” of $43 million, will be initially 49‐percent owned by Ayala with the remainder held by CII and other Vietnamese investors. The deal is subject to customary closing conditions, including compliance with Vietnam laws, the disclosure said. “While we remain focused on developing transport infrastructure projects in the Philippines, we believe this investment also provides the Ayala group strategic access and an option to pursue other infrastructure opportunities in the region,” Ayala President Fernando Zobel de Ayala said in a statement. “We are pleased to have found a partner in Ayala Corp. which has a record for establishing strong long‐ term relationships,” Le Quoc Binh, CII general director, said in the same statement. “Furthermore, Ayala Corp.’s experience in water and real‐estate infrastructure through its subsidiaries will be of help as other opportunities in these sectors arise,” he said. Ayala is one of the largest conglomerates in the Philippines with businesses in real estate, financial services, telecommunications, and a broad range of investments in water, electronics, automotive, international operations and business‐process outsourcing. It also recently made investments in the power generation and transport infrastructure sectors in the country. Ayala shares dipped 1.6 percent to P480 per share, giving the conglomerate a market value of P284.9 billion. CII is a leading player in the infrastructure sector in Vietnam with a solid track record in sourcing, implementing and operating infrastructure assets. Ayala earlier this year acquired its stake in CII in conjunction with Ayala unit Manila Water Co. Inc.’s acquisition of a 47.35 percent share in Kenh Dong Water Supply JSC. http://businessmirror.com.ph/index.php/business/companies/3737‐ayala‐invests‐in‐vietnam‐ infrastructure‐company
PLDT issues P6.2‐B corporate notes Category: Companies Published on Thursday, 22 November 2012 19:18 Written by Lenie Lectura / Reporter PHILIPPINE Long Distance Telephone Co. (PLDT) yesterday issued P6.2 billion in corporate notes to refinance existing debts. In a disclosure to the stock exchange, PLDT Corporate Secretary Lourdes Rausa‐Chan said the corporate notes were issued to a group of primary institutional lenders. The seven‐year and 10‐year tenors were fixed at a yield of 5.50 percent and 5.9058 percent, respectively. “Proceeds from the said facility will be used to refinance PLDT’s existing debts in line with the company’s liability management initiatives to reduce financing costs and rationalize its debt maturities,” said the PLDT official. BPI Capital Corp. and First Metro Investment Corp. arranged the facility. Last month PLDT raised P8.8 billion from seven‐ and 10‐year fixed‐rate corporate notes. The seven‐year tenors carried an interest of 5.6038 percent, while the 10‐year debt papers fetched 5.6423 percent. Proceeds from last month’s facility would be used to refinance PLDT’s existing debts in line with the company’s liability management initiatives to reduce financing costs and extend debt maturities. The PLDT group’s debt stood at $2.1 billion as of end‐September this year. Gross debt amounted to $3.1 billion, with the inclusion of liabilities incurred by newly purchased Digital Telecommunications Philippines Inc. amounting to $0.5 billion. PLDT’s debt maturities, it said, continue to be well spread out, with 64 percent due after 2015. Cash and short‐term securities are invested in bank placements and government securities. In the third quarter of the year, PLDT’s net income dipped by 0.97 percent to P9.22 billion from P9.31 billion in the same period last year. Core net income, likewise, went down by 2.3 percent to P9.36 billion from P9.58 billion. Its third‐quarter performance brought nine‐month net income to P28.7 billion, 6.27 percent down from P30.6 billion mainly due to stiff competition and one‐time manpower payouts. PLDT is maintaining a profit guidance of P37 billion this year. For the fourth quarter, the company expects to record between P9 billion and P9.4 billion to meet the 2012 profit target. http://businessmirror.com.ph/index.php/business/companies/3739‐pldt‐issues‐p6‐2‐b‐corporate‐notes
NFA steps up palay purchase to meet 2012 target Category: Agri‐Commodities Published on Thursday, 22 November 2012 19:23 Written by Jennifer A. Ng / Reporter STATE‐RUN National Food Authority (NFA) said it would “aggressively” buy unmilled rice from farmers in the last quarter so it could meet its target of purchasing 670,000 metric tons (MT) of unhusked rice or palay this year. In a statement, NFA Officer in Charge Ludovico J. Jarina said he had instructed provincial managers to exert all efforts in meeting their respective targets. Jarina gave the instructions in view of the start of the harvest of rice in some areas. “The purchase of palay is in keeping with the government’s goal of veering away from importation and focusing on local procurement for the NFA’s buffer stock,” Jarina said. The food agency, attached to the Department of Agriculture, is mandated to keep a buffer stock equivalent to 15 days at any given time, except during the lean months of July, August and September. The agency is required to have rice stock equivalent to 30 days of consumption during the lean months. As of October 31, Jarina said the food agency has so far been able to procure a total of 5.25 million 50‐kilogram bags of palay equivalent to 262,500 MT. The top three regions where the agency registered the highest procurement record are Southern Tagalog, Central Luzon and Cagayan Valley. NFA buys clean and dry palay at P17 per kilogram with additional incentives such as delivery fee of maximum P0.50/kg; drying incentive fee of P0.20/kg; and cooperative development incentive fee of P0.30/kg. But farmers have complained that they confront difficulties in selling their produce to the NFA. The agency, however, said it has taken the necessary steps to encourage more farmers to sell their produce by implementing new procurement strategies. These include lending empty sacks to farmer‐organizations using their Cooperative Development Incentive Fund and opening buying stations in far‐flung areas. Jarina said his office had also deployed mobile procurement teams, especially in areas where farm gate prices are low. Following the food crisis, which hit developing countries in 2008, the government decided to step up its procurement of palay from local farmers to beef up local stocks and encourage farmers to plant more. The government also poured more funds into the farm sector to prop up palay production and wipe out rice imports by 2013.
Business confidence in PHL still soaring–BSP survey Category: Banking & Finance Published on Thursday, 22 November 2012 19:21 Written by Jun Vallecera / Reporter BUSINESS confidence in the Philippines continued to grow in the last three months of 2012 with the confidence index rising to 49.5 percent from the 42.5 percent registered a quarter earlier, according to a Bangko Sentral ng Pilipinas (BSP) survey. This optimism was driven by a confluence of factors, including the increase in orders and the start of new projects, as well as the potentially higher volume of production. Also cited as contributing factors include higher spending during the extended Christmas season; business expansion programs and new product offerings seen during the period; continued consolidation of the country’s macroeconomic underpinnings; and the likely upgrade of the country’s debt rating. Metro Manila and areas outside it also turned more buoyant. People whose livelihood involved external trade also have a buoyant outlook. According to the BSP, the services sector, which includes banks, proved to be the most bullish. Wholesale and retail trade, anticipating greater consumer activities during the Christmas season, was also upbeat. Businessmen are looking forward to easier access to loans during the period and to better financial conditions. The outlook for employment remains favorable in the fourth quarter, and businesses planning to expand continue to rise. Businessmen also believe the peso would further strengthen and that inflation was likely to range higher. The cost of borrowing during the period, however, was seen easing further, the survey showed. http://businessmirror.com.ph/index.php/business/banking‐finance/3741‐business‐confidence‐in‐phl‐ still‐soaring‐bsp‐survey
ACMF: Regional Integration of Capital Markets Category: Banking & Finance Published on Thursday, 22 November 2012 19:20 Written by Santiago F. Dumlao Jr.
WITH President Aquino becoming busier in meeting with his Southeast Asian counterparts, there has been greater focus now on regional cooperation, and one dimension of it is the integration of our regional capital markets. They may have not received the full attention they deserve, but our capital markets regulators have been quite diligent in working toward regional integration through the Asean Capital Markets Forum (ACMF). Members of the forum are securities regulators from the 10 Asean countries: Brunei Darussalam, Cambodia, Indonesia, Laos, Malaysia, Myanmar, the Philippines, Singapore, Thailand, and Vietnam. ACMF has prepared and endorsed to the 12th Asean Finance Ministers April 2008 Meeting an “Implementation Plan”, a roadmap to the integration of ASEAN capital markets under the objectives of the Asean Economic Community (AEC) Blueprint 2015. The AEC Blueprint 2015 has as its goal the establishment of ASEAN as a single market and production base. Once established, there will be free flow of goods, services, investments and skilled labor, as well as freer flow of capital. In support of this goal, the ACMF Implementation Plan aims to establish a regionally integrated market within the region, where “1) capital can move freely; 2) issuers are free to raise capital anywhere; and 3) investors can invest anywhere. In such a market, anyone would be able to trade in Asean capital market products freely in any Asean market at a competitive fee from a single access point, with capital market intermediaries being able to provide services throughout Asean based on home country approval.” (Executive Summary, The Implementation Plan). This is an Asian financial practitioner’s dream! The best summary statement of the benefits of an Asean capital market integration came from Datuk Ranjit Ajit Singh, managing director of the Securities Commission of Malaysia, whom I quote liberally in the following text.
“Integration will have holistic benefits to all stakeholders, in that: There will be overall benefit to the country in terms of promoting and facilitating economic growth, enhancing the breadth and depth of the capital market and diversifying sources of financing, investment channels and investor base. For investors, capital market integration will lead to enhanced product and service innovation, and lower prices for financial services as competition lowers transactions costs and allows larger regional firms to exploit economies of scale and scope. Investors can also now diversify their investments to a greater extent than before. The integration of markets will allow the intermediaries to benefit from economies of scale and scope, leading to improved and more innovative services at lower prices, as well from the opportunity to tap the larger pool of investors in Asean. For companies/issuers, harmonization of standards can considerably reduce the administrative burden and costs by replacing many different sets of diverging rules with a single set. For government and regulators, capital market integration will lead to a more efficient allocation of capital, arising from the fact that savings can flow more easily and at lower cost to investment and because barriers will have been dismantled. Through sequenced liberalization and integration process, regulation of cross‐border traders and investment will be strengthened and regulators are able to offer greater protection for investors. In addition, through harmonization and mutual recognition agreements, Asean markets will be able to improve their regulatory standards by benchmarking with international standards and adopting best practices. Integration will also hasten the development of the less developed capital markets in the region as they are able to benefit from the experiences of the more developed Asean markets and accelerate their adoption of international standards. We can get the cue from here, and the Philippine businessman—specifically, the financial practitioner— should now prepare to take advantage of the evolving opportunities—as company/issuer of financial instruments, as investor, and as financial intermediary. And for our government regulators and economic managers, this integration facilitates the expected inflow of funds from abroad. 2015 is just around the corner. **** The opinions expressed here are the views of the writer and do not necessarily reflect the views and opinions of Finex. Free Enterprise is a rotating column of members of the Financial Executives Institute of the Philippines that appears every Wednesday and Friday. http://businessmirror.com.ph/index.php/business/banking‐finance/3740‐acmf‐regional‐integration‐of‐ capital‐markets
The winners of 2012 Asia CEO Awards have it all to make PHL a global economy in the future Category: Perspective Published on Thursday, 22 November 2012 18:59 Written by Roderick L. Abad | Special Features Writer
THE Philippines is seen as a key future player in the global market, but it needs world‐class leaders to do so. Chalre Associates Executive Search Chairman Richard Mills told the BusinessMirror in an interview that because of globalization, the country needs to have more experienced and competent leaders to stir up the economy and, eventually, make its presence felt more worldwide in the years to come. “The Philippines has a very young populace. While there are so many good quality young people [here], there’s a critical need for high‐quality senior managers to develop them as good leaders in the future,” said Mills, who is also the chairman of 2012 Asia CEO Awards. A good leadership within an organization or a company is very important for its success. This, among other factors, is dependent on the experience or time spent by its leaders to hone excellent management skills. “So it is vital, especially here [in the Philippines], where the population is very young compared to other countries,” Mills noted. The shortage of senior managers, for instance, is very evident in fast‐growing industries like business‐ process outsourcing (BPO). Over the last 18 years, the BPO sector rapidly has gone from employing roughly zero people to about 700,000 today—all of which are under the age of 35. Industrywide, most of the BPO locators at present are hiring young employees, averaging at the age of 23 as compared to other countries at over 30 or even early 40s.
“As a result, it’s very common to have a 26‐ or 27‐year‐old manager, managing either a hundred, 200 or 500 people,” Mills cited. “The idea of that in other countries would be considered risky.” Such notion, nevertheless, seems to not dissuade foreign investors from doing business in the Philippines. In fact, he said, “most investors who come here are very impressed of the quality of young managers” that they immediately have built large companies with them. Taking a cue from his own experience, he believes that most of the expats who come here will agree that Filipino workers, especially the young ones, “have the heart for what they do and they sincerely want to help other people and be nice to them.” Given their impressive work ethics, however, Mills said they still need the right guidance and direction from experienced leaders to be able to move up in their careers. “Unfortunately, there’s a shortage of senior managers to develop them,” he admitted. “We may have good quality of young people, but the one missing piece of all of that that is critical is the management talent. We need more of them [senior managers]. We have to develop their skills to be world‐class managers. Only by then that the country will move ahead. So this is the purpose of the Asia CEO Awards—to promote excellent leadership and management.” The 2012 Asia CEO Awards IN recognition of leadership excellence within their respective organizations, 11 companies and individuals were conferred with the prestigious 2012 Asia CEO Awards during the Oscars‐inspired awarding ceremonies held at the Resorts World Manila’s Newport Performing Arts Theater in Pasay City on November 8. The Asia CEO Awards is an annual citation that recognizes leadership teams and individuals of organizations operating in the Philippines and the region, who have demonstrated outstanding achievement for their organizations and contributions to others. From over 150 contenders vying for the coveted 10 accolades, the winners in each category were: Ayala Land for Executive Leadership Team of the Year; IBM and Meralco, Top Employer Organizations; Doris Magsaysay Ho (Magsaysay), Global Filipino Executive of the Year; Dan Spinks (Fluor), Expatriate Executive of the Year; Smart Communications, Most Innovative Company; Schneider Electric, Quality Excellence Company; Philippine Stock Exchange, Most Admired Board of Directors; Pointwest Technologies, Technology Team of the Year; Maersk Global Services Cent, Finance Team of the Year; and Coca‐Cola Bottlers, Sales and Marketing Team of the Year. They were adjudged accordingly by the distinguished panel of judges, who are some of the most accomplished and recognized figures in the business community in the country, namely, Dr. Bernie Villegas, distinguished economist, author and professor at the University of Asia and the Pacific; Don Felbaum, founder and chairman of the ICT Committee and Health Committee of the American Chamber
of Commerce of the Philippines; Edward Chang, president of the Korean Chamber of Commerce Philippines; Francis Estrada, independent director, chairman or vice chairman of a number of major corporations and not‐for‐profit organizations; Jun Palafox, president of the Management Association of the Philippines and principal architect of world‐renowned architectural design and planning firm Palafox Associates; Nobuo Fujii, vice president of the Japanese Chamber of Commerce and Industry of the Philippines; and Mills, Board of Governors of the Canadian Chamber of Commerce of the Philippines. “Each category was different. But they [the winners] all seemed over the top [of their game] or had something unique that they [the panel of judges] saw them different from the others,” Mills said when asked about what made this year’s batch of winners a standout from other finalists. With an excellent culture of leadership seemed so ingrained within their organizations, he said they still have areas to improve on when it comes to managing their respective businesses. “If they want to make a place in the global economy, they need to become world‐class in everything they do, such as the performance of their people and business. They need to develop more of their young leaders. That’s where they should focus on,” said the chairman of 2012 Asia CEO Awards. More than 1,000 of the nation’s most senior business leaders were all gathered to witness the recognition rites. Hosted by Giselle Sanchez, John Henrix and Mills, this year’s edition was a class in itself with world‐class entertainment numbers from internationally renowned stage performers Isay Alvarez and Robert Seña, with musical direction from Mel Villena and the AMP Big Band. The 2012 Asia CEO Awards was presented by American Express, in cooperation with the BusinessMirror, Jones Lang LaSalle Leechiu, KPMG, NorthgateArinso, PLDT Alpha Enterprise, Teleperformance and The Net Group. In Photo: Coca‐Cola Bottlers, Sales and Marketing Team of the Year http://businessmirror.com.ph/index.php/features/perspective/3727‐the‐winners‐of‐2012‐asia‐ceo‐ awards‐have‐it‐all‐to‐make‐phl‐a‐global‐economy‐in‐the‐future
Manufacturing Roadmap Ready In Q1 By LEE C. CHIPONGIAN November 22, 2012, 5:17pm The government and the country’s biggest manufacturing group’s efforts to lay down the re‐ industrialization roadmap for the Philippines is expected to be finalized as soon as the first quarter of 2013, implementing the most concrete industry expansion strategy in decades. Trade Undersecretary Adrian Cristobal yesterday said that finally, amidst years of criticism that government has left behind industry developments in favor of a consumption and services‐driven economy, the Department of Trade and Industry, other government agencies and industry organizations will fully implement the manufacturing roadmap under the mandatory medium‐term development plan. “We now have (concrete plans) to achieve the manufacturing sector’s full potential with this strong commitment (which would) steer the country’s re‐industrialization,” Cristobal, also Board of Investments managing head, told members of the Federation of Philippine Industries attending the 2nd Philippine Manufacturing and Producers Summit by the Federation of Philippine Industries. Cristobal also announced during the event the revival of the Industry Development Council which has remained dormant since the time of President Fidel Ramos in the 1990s. The council, similar to the setup of the Export Development Council, will be a working group starting in the first quarter next year, about the same time that the roadmap will be implemented. The Industry Development Council will set targets for industries, primarily on increasing the share of the manufacturing sector to gross domestic product (GDP). Cristobal said as of the end of the first semester, manufacturing only contributed 20 percent to GDP and generated 16 percent of jobs in the total labor force, about 3.2 million workers. In the first six months of foreign direct investments (FDI) registrations, 75 percent of approvals are from the manufacturing sector, totaling $47.5 million or up 10.8 percent year‐on‐year. “There’s much to be done, other countries (in the region) contribution to their GDP growth range from 26 percent to 43 percent while in terms of value added share, it declined (for the Philippines) when it was increasing in China and Indonesia,” said Cristobal. Deutsche Bank’s Rafael Garchitorena, citing the bank’s research data, noted that they have seen evidence that there is a resurgence in the manufacturing activities since 2010. Garchitorena said the manufacturing sector will be again a growth driver and there is data support. “The manufacturing sector is no longer a dream but already happening despite the many challenges.” He said the stable labor costs is one of the positive factors that will push investors back to the Philippines, which is now lower compared to Asian neighbors. While the power rates are still expensive
comparably, labor is now cheaper but more skilled and this will be one of the important deciding factors for foreign investors to locate here. Cristobal agrees, saying that there is more confidence now in the economy that manufacturers are becoming more bolder in laying down investment plans. “The (industry development) council will be very comprehensive in setting up industry standards under the PPP (public‐private partnership).” One of the sectors they are looking at initially is developing or re‐developing the basic industries such as iron and steel, copper and petrochemicals. “There have been attempts to do this in the past but it did not take off. I think the economic condition now is very different and we are in a stage of economic growth that makes the environment more conducive to industry development,” Cristobal said. http://www.mb.com.ph/articles/382611/manufacturing‐roadmap‐ready‐in‐q1#.UK7Y6eTBPSs
6 Forest Management Agreements Cancelled By FRANCO G. REGALA November 22, 2012, 5:32pm The Central Luzon Executive Director of the Department of Environment and Natural Resources (DENR) yesterday ordered the cancellation of six Socialized Industrial Forest Management Agreements (SIFMA) covering 735 hectares of forestland in four Central Luzon provinces after a performance evaluation showed the SIFMA holders failed to adequately develop their areas. “Not only did the SIFMA holders fail to develop and protect their areas, they also failed to pay their annual rentals resulting to losses in government revenues,” said DENR regional director Maximo Dichoso. “The lessees also failed to submit annual accomplishment reports as stipulated in their SIFMAs,” Dichoso said. Dichoso said the joint review team found grave violations of the terms and conditions of the Lease Agreement, particularly Item Nos. 1, 11, 20, and 25, and the provisions of DENR Administrative Order No 2004‐30 or the revised rules and regulations governing the SIFMA Program. The SIFMAs ordered cancelled are located in Bulacan, Zambales, Tarlac and Nueva Ecija, and will be included in the National Greening Program (NGP) targets for 2013, he said. Since 2010, the DENR has already cancelled 43 SIFMAs in the region covering 3,880 hectares of forestland. This year, the DENR reviewed a total of 157 SIFMA holders in Region 3 covering at least 2,000 hectares. Of these, 117 SIFMAs covering more than 1,300 hectares were recommended for cancellation. The DENR is set to review the performance of another 170 SIFMA holders by 2013 covering 3,964 hectares. DENR records showed that Central Luzon’s 324 SIFMA holders covered more than 6,000 hectares and generated a total of P563,718 in rentals since 2010. Under the SIFMA program, a natural or juridical person enters into an agreement with the DENR, and is conferred the right to develop, utilize and manage a small tract of forestland for 25 years, renewable for another 25 years, consistent with the principles of sustainable development. Individual or single family units who are Filipino citizens, or cooperatives and associations whose members are also Filipino citizens, and registered with Securities and Exchange Commission (SEC) or Cooperative Development Authority (CDA), may participate in the program. Under DAO 2004‐30, individual or single family units may develop up to 10 hectares of forestland while associations or cooperatives may develop up to 500 hectares.
BIR Collection Topping P1 Trillion In 2013 By CHINO S. LEYCO November 22, 2012, 5:18pm The Bureau of Internal Revenue (BIR), the government’s main tax agency, said yesterday that its collection this year will exceed P1 trillion mark. BIR Commissioner Kim S. Jacinto‐Henares said that the agency is working hard to raise the needed P208‐ billion collection in the final two months of the year to meet the P1.066 trillion target for 2012. “I’m confident that we will meet the P1 trillion mark, but when it comes to our full‐year target, I can say that we’re working hard to achieve it,” Jacinto‐Henares said. As of October this year, the BIR collected P858.6 billion, higher by 13.45 percent compared with P756.7 billion in the same period last year. The BIR’s end‐October collection, however, was short by 3 percent against the P886,5 billion target for the period. In November, the BIR is expected to raise P102.9 billion and another P76.6 billion in taxes in December. Last month, the BIR also achieved its collection target by generating P86.1 billion in collection, short by P800 million against the P86.18‐billion goal. Year‐on‐year, the BIR October collection grew by 22.13 percent from P70.5 billion. In October, collections from BIR operations reached P83 billion, an increase of 20 percent compared with the same month last year, also exceeding the P82.4‐billion goal. Meanwhile, collections from non‐BIR operations increased by 140 percent to P3.15 billion from a year ago, but short by 17 percent compared with the target. Collections by the Regional Offices amounted to P33 billion in October, higher by 39 percent compared with the same month last year, continuing with the trend of double‐digit growth being registered by cluster for this year. Regional Offices also exceeded its goal for the month by 14 percent. Collections by the Large Taxpayer Service, meanwhile, reached P49.96 billion, an increase of 10 percent from a year ago. http://www.mb.com.ph/articles/382612/bir‐collection‐topping‐p1‐trillion#.UK7Y6OTBPSs
SMEs Should Leverage Big Data By BERNIE CAHILES‐MAGKILAT November 22, 2012, 5:04pm SAP, the world market and technology leader in business management software, expects more Asian companies, particularly SMEs leverage big data to become more productive and competitive. Anthony McMahon, SAP senior vice‐president for database and technology for Asia Pacific and Japan, said during a media roundtable at the sidelines of SAP Influencer and Analyst Summit at the Marina Bay Sands Convention Center in Singapore that while there is no conclusive study that would show correlation between leveraging big data to a company’s revenue generation, companies that are able to implement technologies deliver services quicker. McMahon stressed that companies that have the ability to implement technologies quickly are able to deliver services quickly to their customers. Big data refers to the vast quantities of data being produced in the world. One example is the social networking media. Facebook, for instance, generates huge amount of data. This data can be used to aid an enterprise improve its operation and become more efficient. McMahon stressed that SAP has software programs that are designed to help SMEs turn data into useful and meaningful information to enable them to��improve their operations, raise productivity at reduced costs. SAP is now positioning its focus on the software programs that would enable Asia’s SME sector maximize the precious information captured from big data. “SMEs have the advantage of being more nimble than their bigger counterparts, and thus can reap the benefits more quickly,” he said. By utilizing big data efficiently, he said, enterprises can act on emerging trends, engage with their customer base and explore potential risks. McMahon, who has been responsible for SAP’s focus on delivering the data management and data orchestration solutions for SAP environments, explained that since leveraging big data would be able to direct a company to achieve its goals. He said that investment in technology must be able to make value justification. “The investment has to articulate what value is put on the table now and makes sure that value pays,” said McMahon.
McMahon cited SAP’s HANA real‐time application and data platform, which can be applied by SMEs based on their needs. There are solutions that can be availed of on a per use basis enabling SMEs to spend less on hardware and infrastructure. And SAP HANA is highly scalable that this has been tapped by large corporations. Stephen Taylor, chief information officer of EMPR Group, said they are planning to apply an automatic feed of data analysis to its customers real time. “By improving on data use we are also improving productivity,” Taylor said. http://www.mb.com.ph/articles/382600/smes‐should‐leverage‐big‐data#.UK7Z4‐TBPSs
Asia’s Economy Has Stabilized – IMF By ENDA CURRAN November 22, 2012, 5:08pm SYDNEY (Dow Jones) – Asia’s economy has bottomed and growth will pick up heading into 2013, a top official at the International Monetary Fund (IMF) said in upbeat remarks backed up by buoyant Chinese data released Thursday. “Asia has stabilized. The last two quarters in China have picked up slightly. We project growth to pick up next year,” Anoop Singh, chief of the IMF’s Asia and Pacific Department, said in an interview. The Washington‐based fund forecasts Asia’s economy to grow 5.4% this year and 5.9% in 2013, and expects China’s economy – the world’s second‐largest – to grow at a healthy 7.8% this year and 8.2% in 2013. This will help buffer the region as the US and European economies gradually recover. Mr. Singh’s view echoes a bullish outlook from the Organization for Economic Cooperation and Development, which this week said strong domestic demand will spur Southeast Asian economies to grow as fast in the next five years as they did before the latest global financial crisis. Manufacturing activity across Asia is showing renewed signs of life. A preliminary gauge of China’s manufacturing activity in November showed the first expansion in 13 months, reinforcing evidence of a turnaround for the Chinese economy. The preliminary HSBC China Manufacturing Purchasing Managers Index, a measure of nationwide manufacturing activity, rose to 50.4 in November compared with a final reading of 49.5 in October, HSBC Holdings PLC said Thursday. Recent export volumes from South Korea and Indonesia also indicate better demand, although other manufacturing centers including Taiwan and Singapore remain in the slow lane. Analysts are broadly downbeat about Japan’s prospects after it posted its fourth‐straight monthly trade deficit in October. Mr. Singh said a resolution of the US “fiscal cliff” debate – with a package of automatic tax hikes and spending cuts set to take effect soon – and European progress on stabilizing the situation in Greece would give a vital confidence boost to the world economy. “There are clear risks from advanced economies. So far Asia has held out. Were there to be a new greater shock clearly there would be an impact,” he said. The IMF forecasts China’s economy – the world’s second‐largest – will grow 7.8% this year and 8.2% in 2013. Describing China’s tightly controlled currency, the yuan, as undervalued – something which has been a source of tension with its major trading partners – the IMF official said Beijing has already done much to adjust its economy so that it relies less on exports for growth, and more on consumption.
“Clearly many exchange rates, including China’s, are undervalued, but we have to look at the broader package and the need to shift towards more consumption and financial market liberalization,” Mr. Singh said. The IMF official welcomed the start of Asian leaders’ negotiations aimed at creating one of the world’s biggest trade pacts by 2015. Sixteen countries including China, Japan, India and Australia hope to establish the Regional Comprehensive Economic Partnership, or RCEP, which officials say will allow a greater flow of goods and services and avoid overlapping deals, as countries in the region pursue bilateral and trilateral trade agreements. The US hopes to have a separate Pacific Rim trading pact in place by the end of next year, and China, Japan and South Korea are considering their own trilateral deal. “This comes down to economic integration. We have learned lessons from Asia and other parts of the world that this is what is needed,” Mr. Singh said. “More cooperation, more integration is needed.” http://www.mb.com.ph/articles/382604/asia‐s‐economy‐has‐stabilized‐imf#.UK7Z3‐TBPSs
Growth Momentum Sustained In Q3 November 22, 2012, 5:16pm Philippine economic growth likely defied the global downturn and picked up modestly in the third quarter, helped by strong domestic demand and a late spurt in exports, but a December rate cut may still be on the cards to contain the peso’s strength. The median forecast of 0.4 percent seasonally adjusted quarter‐on‐quarter growth in a Reuters poll is slightly higher than the previous quarter’s 0.2 percent expansion, but weaker than the 3.0 percent pace seen in the Jan.‐March quarter. From a year earlier, the economy may have expanded 5.4 percent. Although slower from the second quarter’s annual climb of 5.9 percent, the pace is enough to keep the Philippines in the ranks of the fastest‐growing economies the world. “Growth is expected to remain strong, buoyed by domestic demand and strong overall export performance in the third quarter. This is despite the output loss caused by floods in August,’’ said Vaninder Singh, economist at RBS in Singapore. On a year‐on‐year basis, economists’ growth forecast for the Philippines is better than Malaysia’s actual 5.2 percent expansion and Thailand’s 3.0 percent, and not far behind China’s 7.4 percent and Indonesia’s 6.2 percent growth. Manila is targeting a faster growth of 5 to 6 percent this year compared with 3.9 percent in 2011, banking on strong domestic demand and higher government spending to offset weak global demand for the country’s exports. Domestic consumption, which powers 70 percent of economic activity, likely stayed robust, fueled by remittances from Filipinos working overseas. Those inflows averaged more than $1.8 billion in the third quarter, helping offset soft external demand. Exports, which account for about two‐fifths of GDP, rebounded sharply in September from a year earlier but sluggish global demand will probably keep the outlook murky well into 2013. “Although the economy faces challenges such as slowing external demand, record low interest rates should keep growth momentum going into the first half of 2013,’’ said Jeff Ng, economist at Standard Chartered bank in Singapore. While a relatively resilient performance in the third quarter would argue against a December rate cut, some economists such as Jun Neri at Bank of the Philippines said the central bank may ease policy further to temper the peso’s rise. The peso is Asia’s best performing currency so far this year, up nearly 7 percent against the US dollar on strong foreign inflows into Philippine stocks and bonds, fueled by forecasts of sustained strong domestic growth.
A recent Reuters poll showed further gains in the currency were expected. With the inflation outlook benign, the central bank has room to either keep policy rates steady, or cut them, if needed to support growth and manage strong capital inflows. Policymakers meet for the last time this year on Dec. 13. The key overnight borrowing rate is at a record low of 3.5 percent after a combined 100 basis point cut so far in 2012. Inflation eased more than expected in October to 3.1 percent from a year earlier, a four‐month low. (Reuters) http://www.mb.com.ph/articles/382610/growth‐momentum‐sustained‐in‐q3#.UK7Z1‐TBPSs
DOTC Prepares To Roll Out 8 Public‐Private Partnership Projects By EMMIE V. ABADILLA November 22, 2012, 5:20pm Of the country’s $4.8‐billion Public‐Private Partnership (PPP) projects which have been lined up, the Department of Transportation and Communications (DOTC) is rolling out 8 – four airports, one automated fare collection system, a couple of railway projects and one integrated transport terminal. DOTC Secretary Joseph Emilio Aguinaldo Abaya made the announcement yesterday during the Economic Journalists Association of the Philippines, Inc. (EJAP) Forum 2012 in Makati City. Foremost of all, DOTC is rolling out the construction of a P10‐billion new passenger terminal building for the Mactan‐Cebu International Airport that will accommodate an additional 8 million passengers to complement the existing terminal. “We will be contracting out to private sector partners the Operations and Maintenance of this airport,” he noted. Aside from Mactan, three more airports will have their O&M contracted out: The new Bohol Airport which will replace the existing Tagbilaran Airport and the Laguindingan Airport in Misamis Oriental in Northern Mindanao, which will start operating first quarter next year. DOTC is also upgrading the Puerto Princesa Airport in Palawan to meet the surge in tourists to the Underground River. “We are coordinating with Tourism Sec. Mon Jimenez to ensure that DOTC infrastructure projects support strategy for tourism,” Abaya added. DOTC likewise plans to install a P1.8‐billion Automatic Fare Collection System in its MRT and LRT Lines. “We will be de‐commissioning the old magnetic‐based ticketing system and replacing it with contactless‐based smart card technology similar to the Octopus and Oyster systems in other countries.” The bidding for the LRT Line 1 Cavite Extension has been closed and the department now has four business groups competing for the contract. “This is an example of Hybrid PPP and happens to be the biggest project in our shop. I have nothing to do with its priority and it just happens to be the most populous province,” the DOTC secretary noted. Furthermore, the department is contracting out the O&M of LRT Line 2, which runs from Recto Station in Manila to Santolan Station in Pasig City to the private sector. The O&M will include a 4‐km. extension that will be constructed from Santolan, Pasig to Masinag in Antipolo City.
Finally, “We are now procuring a transaction advisor for the Integrated Transport System (ITS) Project, which aims to put up three world‐class mass transportation intermodal terminals at the boundaries of Metro Manila: one each in the north and two in the south of the metropolis.” The terminals will cater mostly to the provincial buses, which will be prohibited from entering the streets of Metro Manila, and connect passengers to other urban transport systems — by railway, taxi and other public utility vehicles serving the inner city. Overall, “This administration is doing all it can to give everybody equal treatment in all these PPP projects and all other PPP projects in the future,” he concluded. http://www.mb.com.ph/articles/382613/dotc‐prepares‐to‐roll‐out‐8‐publicprivate‐partnership‐ projects#.UK7Z1uTBPSs
ADB: Emerging Asia Bond Markets Robust But Face Downside Risks By MICHAEL S. ARNOLD November 22, 2012, 6:36pm SINGAPORE (Dow Jones) – Bond markets in emerging East Asia are continuing to grow quickly, but the US fiscal woes, China's economic slowdown and a flood of capital from the developed world present downside risks, the Asian Development Bank said in a report published Thursday. In the latest edition of its Asian Bond Monitor, the Manila‐based lender says local currency bond markets in emerging East Asia have continued their robust performance, with both government and corporate bond sectors growing strongly. "The bond market is becoming the most important source of financing for Asia, but the risks are very serious," Iwan Azis, head of the ADB's office of regional economic integration, said in an interview. The volume of bonds outstanding in emerging East Asian markets rose 3.8% on‐quarter and 11% on‐year in the third quarter. Singapore's bond market was the fastest‐growing on‐quarter, growing 6.1%, while Vietnam's market grew the most compared to a year ago, up 21.4%. The report looks at markets in China, Hong Kong, Indonesia, Malaysia, Philippines, Singapore, South Korea, Thailand and Vietnam. The report found that government bond yield curves in the region have shifted downward as inflation has moderated and most Asian central banks have cut policy interest rates. In addition, money unleased by quantitative easing and low interest rates in G3 countries is rushing into the region, further helping to push down yields. "Asia is one of the favorite destinations for this capital," Mr. Azis said. The 1997 Asian financial crisis underscored the need for stronger and deeper bond markets here. Mr. Azis said the crisis exposed a "double mismatch" that threatened the stability of the region's economies and financial systems, with many institutions borrowing short‐term while lending long‐term, and borrowing in foreign currencies but lending in local money. "Officials in Asia leaned from that very bitter experience in 1997, so now they try to avoid this and the bond market is the answer," he said. Bank lending still accounts for some 60% of corporate finance in Asia, but that's down from about 80% a decade ago, Mr. Azis said. Corporate bond markets in emerging East Asia grew 4.2% sequentially in the third quarter, up from 3.1% in the April‐June period. In addition, new issuers and investors entered the market, serving to deepen and diversify them.
"One of the characteristics of Asian bond markets is that they've been highly concentrated, in banking and utilities mostly. But we're seeing a trend of diversification in terms of issuers and investors," Mr. Azis said. "Insurance companies as well as pension funds are starting to be players." The fact that Asian central banks in places like South Korea and Indonesia are now less inclined to sterilize inflows of foreign currency has helped shift the balance away from government paper, the report notes. "Asian bond markets have been still dominated by government bonds, and the fact that corporate bonds are growing faster than government bonds, that's a very welcome development," Mr. Azis said. Foreign holdings of local‐currency bonds are rising, reflecting growing perceptions that Asian bonds are safer than they used to be. Foreigners own nearly 30% of government bonds in Malaysia and Indonesia, and 15% in Thailand, according to the report. However, strong capital inflows expose East Asian markets to the risk of contagion from financial crises in the developed world. "The flow of funds from global capital markets presents opportunities for growth in the real sector when properly channelled into real investments; it also raises concerns over capital flight risks," the report said. "The need for strengthening the domestic investor base and putting in place domestic safety nets remain key policy measures needed to address any adverse impacts from capital flows reversals." http://www.mb.com.ph/articles/382642/adb‐emerging‐asia‐bond‐markets‐robust‐but‐face‐downside‐ risks#.UK7Zx‐TBPSs
Northern Cebu Fishermen Urge Cutting Visayan Sea Fishing Ban Period By MARS W. MOSQUEDA JR. November 22, 2012, 5:02pm BANTAYAN ISLAND, Cebu – A group of commercial fishers in this island located north of Cebu is urging the Bureau of Fisheries and Aquatic Resources (BFAR) to shorten the fishing ban period in the Visayan Sea to allow fishermen to get back to their daily source of livelihood. The Northern Cebu Commercial Fishing Operators Association (NCCFOA) told BFAR in a letter that the four‐month‐ period imposed by said ban is “just too long for fisherfolks who depend entirely on fishing as a means of livelihood.” The group urged BFAR to shorten the ban to three months. NCCFOA President Romeo Villaceran said the group supports government's effort to allow sardines and mackerel fish stocks to recover in the Visayan Sea but he said the duration of the ban is too long for people who rely on fishing. The group's letter to BFAR Manila was in reaction to the Fisheries Administrative Order 167 that set a close season in the Visayan Sea from Nov. 15, 2012 to March 15, 2013 to allow sardines and mackerel fish stocks to recover. The Visayan Sea is found off northern Cebu, Masbate, Panay and Samar. Villaceran said his group can help improve fish stocks in the Visayan Sea by installing a fish condo, a structure made of bamboo, net and cement that provides an area for fish to lay eggs. It functions like an artificial reef. The BFAR in Central Visayas, earlier, assured the public that there will be no shortage of fish supply in the Visayas region as the four‐month fishing ban in the Visayan Sea takes effect. The agency made the pronouncement after Visayan residents expressed fears that a 120‐day ban on sardines and mackerel fishing in the Visayan Sea could result to a lack of supply for fish in the region. BFAR has already sent at least six vessels to patrol the Visayan sea to ensure that the fishing ban is implemented. BFAR director Asis Perez earlier said the coverage of the prohibition on sardine and mackerel fishing will start from the mouth of the Danao River on the northeastern tip of Bantayan Island to Madridejos, through the light house on the Gigantes Island to Clutaya Island, and to Culasi Point in Capiz province.
Korean Way To Help Farmers By DR. BERNARDO M. VILLEGAS November 22, 2012, 5:36pm Thanks to a recent publication of the Asian Development Bank, Philippine society can have a most effective agenda for addressing rural poverty in the next ten years. Entitled "The Saemaul Undong Movement in the Republic of Korea (Sharing Knowledge on Community‐Driven Development)," the report was authored by Dr. Djun Kil Kim, who has been a Visiting Professor in Korean Studies at the University of Asia and the Pacific for the last three years. I have had many occasions to discuss with him the topic of rural development even before the report was published. Sad to say, millions of Filipino farmers today are still wallowing in poverty in the same way that Korean farmers were in the 1970s, 40 years ago. It is well known that some 75 percent of the close to 20 million Filipinos surviving on less than $1.5 per person per day are in the rural areas. Philippine poverty is mainly rural poverty. This tragic situation can be attributed to a total neglect of rural infrastructures, both hardware and software, as successive Philippine governments were fixated on inward‐looking, import‐substitution, protectionist, and capital‐intensive industrialization. Rural and agricultural development received mostly lip service. Under Park Chung Hee, Korea's rural development was never sacrificed on the altar of industrialization. Under his inspiration and supervision, the Saemaul Undong (SU), the New Village Movement as it is often referred to, was a community‐driven development (CDD) program pursued during the 1970s. Ultimately, this was the key program in the country's long‐term economic development implemented during the later half of the 20th century. It was the very foundation of the poverty eradication program that has catapulted South Korea to a First World country today, one of the few developing countries in the last century that escaped from the middle‐income trap in which the Philippines‐‐together with numerous middle‐income countries today – are still ensnared. The major aim of the SU movement was to overcome what at the time appeared to be endemic rural poverty in the Republic of Korea. In the early 1970s, 33,267 mauls (traditional villages) participated in the SU movement. In each maul, male and female Saemaul leaders were democratically elected at a village general meeting. The outward achievements of the movement, with both the national and local governments working in tandem with nongovernmental organizations, focused on the rehabilitation of village infrastructure, improvement in the overall rural living environment, and a significant increase in household income. Its implementation took place in three successive stages that included basic infrastructure (Stage I), development (Stage II), and dissemination (Stage III), the last targeted at widening the acceptance by the populace of the principles that were key to the success of the movement in both the medium and long term. Through the provision of farm‐to‐market roads, irrigation systems, post‐harvest facilities, and high‐ yielding hybrid rice varieties, by the end of Stage I, rural household incomes had reached parity with
those of urban industrial households. During Stage II, village life was improved through modernization of rural dwellings with changes such as replacement of thatched roofs with tin, and slate roof coverings; electrification; and introduction of telecommunications on a mass basis in the rural villages. By the end of the 1970s, despite very limited agricultural lands, South Korea had overcome its chronic shortfall in the domestic supply of food. The most important game changer introduced by the Saemaul movement, however, was in the behavioral transformation among the Korean farmers who were very different from our present image of the hard‐working, highly driven and strongly motivated Koreans of today. The Korean farmers were then often criticized as laid back and superstitious. The greatest accomplishment of the SU movement was the sweeping change in the mentality of the people. The SU movement built a national confidence infused with a "can‐do" spirit that transformed a former national mentality of chronic defeatism into new hope, a long‐term shared vision of a better life for all, and an infectious enthusiasm sustained by volunteerism at the community level. What the SU movement built was social capital through community networking that took place in Saemaul halls, in village forums, and at village general meetings (VGMs). During the period 1972‐1980, more than 37,000 community halls were built, this total number translating into nearly one community hall per village. So great was the SU movement's impact on community empowerment that the decision‐making power of the non‐government VGMs ultimately exceeded that of the semi‐governmental village development committees, which in part comprised local government administrative officials. Those interested in replicating the SU model in their respective localities may download the publication from the website adbpub@adb. The Korea Embassy in Manila may be asked to arrange actual tours and even total immersion in the Saemaul villages still existing in South Korea. In fact, there is a Christian community that has put up the equivalent of a Saemaul village in the province of Zambales. For comments, my e‐mail address is email@example.com. http://www.mb.com.ph/articles/382624/korean‐way‐to‐help‐farmers#.UK7cIuTBPSs
Boosting The Philippine Fisheries Sector November 22, 2012, 5:43pm More government attention is being given the country’s fisheries sector. The aim is to replenish fish populations in key marine biodiversity areas nationwide. On October 17, 2012, the Department of Agriculture (DA), Bureau of Fisheries and Aquatic Resources (BFAR), and United States Agency for International Development (USAID) launched the five‐year (2012‐2017) Ecosystems Improved for Sustainable Fisheries (Ecofish) project as part of the 2012 celebration of Fish Conservation Month. The target is a 10 percent increase in fish biomass and in the number of jobs for rural folk. Ecofish is designed to contribute to the priority goals laid out in the Philippine Development Plan, in the areas of sustainable agriculture and fisheries and the conservation and rehabilitation of natural resources. It is an offshoot of the World Bank (WB) campaign to save oceans and seas. It has identified eight marine key biodiversity‐rich locations where it will seek to replenish fish and ensure good catches for fisherfolk – Calamian Group of Islands in Palawan, Lingayen Gulf in Pangasinan, Ticao Pass‐Lagonoy Gulf‐San Bernardino Strait in Bicol and Samar, Danajon Double Barrier Reef in Bohol and Leyte, Southern Negros Occidental, Surigao, the Sulu archipelago, and the Verde Island Passage between Batangas and Mindoro. Environment change adaptation will be integrated into the plan for each of the eight biodiversity areas, which have such issues as pollution, overfishing, and environmental degradation, that impact on Philippine fisheries. Philippine fisheries production has shrunk over the years, with the decline hitting 3.3 percent in the first half of 2012. Environmentalists advocate protection of coral reefs, as these serve as foraging ground for various fish species. A study showed that 40 percent of the country’s 26,000 kilometers of coral reefs are “in poor condition.” The DA imposed a closed season for sardines, herrings, and mackerels in the Visayas Sea from November 15, 2012 to February 15, 2013, the fish species’ spawning season, under Fisheries Administrative Order 167, to enable the fish to regenerate and propagate. We wish Department of Agriculture Secretary Proceso J. Alcala, Bureau of Fish and Aquatic Resources Director Atty. Asis G. Perez, Bureau of Protected Areas and Wildlife Director Theresa Mundita S. Lim, USAID Philippines Mission Director Gloria D. Steele, and USAID Philippines Chief of Energy and Environment Rolf R. Anderson, all the best and success in their partnership on programs to upgrade the Philippine fisheries sector. CONGRATULATION AND MABUHAY! http://www.mb.com.ph/articles/382630/boosting‐the‐philippine‐fisheries‐sector#.UK7cIeTBPSs
Voice from the South
Philippine Economy: Let's Be Realistic By FR. EMETERIO BARCELON, SJ November 22, 2012, 5:46pm
Our present economy is praised by most, even by the International Monetary Fund President, Christine Legarde. In spite of recession in Europe and difficulties in other parts of the world we are growing positively for about 5% to 6% pa. Shouldn’t we be happy? However, we should be growing at a 9% clip, for at least for a couple of years if we are to get out of the poverty that plagues a good 20% to 40% of our people. We have at least 8 million to ten million working abroad instead of here at home. What can we do to push the economy faster? Most jobs are created by small‐scale and medium industries. The big ones, however, are just as important. We need to push not only innovation and entrepreneurship but also provide liquidity for those who engage in enterprise. Our financial systems are still immature and untried. We also need to facilitate doing business easier. Time is of the essence. Bureaucratic regulations are favorable to petty functionaries to hold a project hostage. Withholding permits is a common ploy. The enterpriser either has to come up with a bribe or acknowledge that he owes a debt of gratitude to the functionary. (A local builder was invited to Papua New Guinea and he says he had all the permits he needed to do construction work in two days, a task that would have taken him six months to obtain in the Philippines.) Is it possible for all of us to look at the common good of the country? Our laws are not really welcoming to foreign direct investments. We reserve areas of business to local companies especially exploitation of natural resources. There was probably a time that this was necessary and reasonable. But it is no longer necessary. There are two bad effects of this. One is that since we do not have the capital to do this work, the resources remain untouched. Secondly we do not have the jobs that we need to feed our people and move the economy. Some think it only protects the hundred or so families that are rich in this country. Direct investments are hampered by loud mouths. We have laws that regulate all transactions but instead of waiting for Congress to modify the laws, they block good projects because they are foreign. A good example is the Tampacan mine. This has the potential to be the biggest copper and gold mine in the world. But local politicians have blocked this
project although approved according to our laws. Passing laws against open pit mining on the local level is unthinkable in any other country. We have to think in broader perspectives, national versus local, the now versus the longer future. In the past they say the country did not get enough benefits from mining projects. This may have been true then, but now foreign mining firms have to share fifty‐fifty with the government their net income over and above other taxes. With the prices of copper and gold at present high level we should be experiencing a mining boom. But meddlers are endangering our missing this advantage of high prices. Talk is cheap while mining is a difficult enterprise. We are fortunately experiencing a construction boom which should last at least another five years. But that is not enough. We have to look at the longer run. We can no longer industrialize and export manufactured goods but we can mine and export the products. We are lucky that we have the BPO and other computer servicing opportunities but again this is not enough to give all our people good jobs. We have to be realistic and plan for the long run, the national good, and the benefit to as many as possible of our people. We already missed the East Asian boom in exports as well as the chance to industrialize with manufacturing. We cannot let the opportunity for a mining boom to slip through our hands. firstname.lastname@example.org http://www.mb.com.ph/articles/382633/philippine‐economy‐lets‐be‐realistic#.UK7cIuTBPSs
November Is Rice Awareness Month November 22, 2012, 5:51pm
Pursuant to Presidential Proclamation 524 issued in 2003, November is observed as National Rice Awareness Month throughout the country. The month-long observance seeks to create greater public awareness on how consumers can contribute toward attaining the vision of self-sufficiency in rice. This year’s celebration led by the Philippine Rice Research Institute (PhilRice) urges the consumers to try diversifying their dietary intake by trying other quality nutritious foods such as white corn, sweet potato, cassava, and banana as rice substitutes. PhilRice also encourages Filipinos to eat unpolished or brown rice, which has a higher (75 percent) milling recovery rate compared with that of white rice (65 percent). Brown rice is more nutritious as it retains most of the nutrients from the rice bran that are removed by polishing. Last October 18, 2012, President Benigno S. Aquino III signed Presidential Proclamation No. 494 declaring 2013 as National Year of Rice, with the theme “Sapat na Bigas, Kaya ng Pinas!” It is hoped that through these efforts, the public will be encouraged to be responsible rice consumers. PhilRice has received pledges from various individuals and groups committing themselves not to waste rice by cooking what they and their family can eat, recycling leftover rice into other dishes, ordering only enough rice that they can consume in eateries, and properly cooking rice – not over or undercooked. The National Rice Awareness Month celebration coincides with the Founding Anniversary of PhilRice. We congratulate the Philippine Rice Research Institute, led by its Chairman Department of Agriculture Secretary Proceso J. Alcala, Executive Director Dr. Eufemio T. Rasco Jr., Deputy Executive Director for Research Dr. Manuel Jose C. Regalado, Deputy Executive Director for Development Dr. Eduardo Jimmy P. Quilang, and Director for Administration Dr. Caesar Joventino M. Tado, on the occasion of National Rice Awareness Month 2012 and the Institute’s 27th Founding Anniversary. We wish them all the best and success. CONGRATULATIONS AND MABUHAY! http://www.mb.com.ph/articles/382635/november‐is‐rice‐awareness‐month#.UK7b‐eTBPSs
MPIC on stream with corporate governance SPYBITS By Babe G. Romualdez (The Philippine Star) | Updated November 22, 2012 ‐ 12:00am A number of businesses are recognizing the significance of good corporate governance especially with the public becoming more discerning, not to mention more vigilant, about the way companies conduct their operations, with public perception impacting a company’s profitability and long‐term sustainability. Just recently, Manny Pangilinan’s First Pacific Group invited US business ethics expert Thomas Donaldson to speak on corporate governance and business ethics with the board of directors and senior managers of PLDT, Meralco and other businesses affiliated with the First Pacific Group. In a roundtable discussion where we were invited together with fellow star columnist Boo Chanco, Donaldson (who is the director of the Zicklin Center for Business Ethics and Research) and who is also a professor at the Mark O. Winkelman, Wharton School in the University of Pennsylvania) tackled key enhancements on good governance, arising from the need to “navigate the new world of business,” emphasizing the role of ethics, reputational risk and integrating ethics into strategy. Donaldson has written extensively on the subject of business ethics and corporate governance, testifying before the US Senate regarding the Sarbanes‐Oxley corporate reform legislation during the height of the Enron scandal. MVP, who obtained his MBA also from Wharton, avers that “good governance” is indeed at the heart of corporate leadership, and that business plans and strategies should always take into account the “evolving demand of business ethics.” Not that corporate governance is new to MVP, since it has been a pillar of his strategy in running his businesses, seen from the time First Pacific made its investment with PLDT in 1998 with transparency, accountability and fairness inculcated in the mindset of employees via the company’s manual on corporate governance and code of business conduct and ethics. Not surprisingly, PLDT received the Platinum Plus award earlier from the Institute of Corporate Directors’ (ICD) Corporate Governance Scorecard for publicly listed companies, having been a Gold awardee for four consecutive years with a score of 95 percent in the ICD scorecard. It would seem the culture of good governance and corporate responsibility is rubbing off on the other companies under MVP – something that is being noticed by many sectors. A few days ago, Philex Mining Corp.’s Padcal mine in Benguet won the “Best Mining Forest” award from the Philippine Mine Safety and Environment Association – the 10th time it has done so. On the other hand, Philex’s Silangan project also received the Industry Excellence in Exploration platinum award and the “Best in Mining Forest” honors for the exploration category. The mining giant was also cited by Forbes Asia as one of the “Best Under a Billion” companies in Asia for 2012, with a market cap of $2.72 billion (as of July this year) and posted sales of $349 billion. http://www.philstar.com/business/2012‐11‐22/870329/mpic‐stream‐corporate‐governance
BSP tightens rules on bank ownership By Prinz Magtulis (The Philippine Star) | Updated November 23, 2012 ‐ 12:00am
MANILA, Philippines ‐ Shareholders of banks to be established and acquired will have to submit two new requirements to the Bangko Sentral ng Pilipinas (BSP) which wanted to make sure that bank owners are in good standing. Copies of income tax returns and clearances from the Bureau of Internal Revenue and the National Bureau of Investigation will now have to be secured before BSP approves a bank application and acquisition, Circular No. 774 said. Proposed directors, officers, subscribers and shareholders will be required to submit the documents, it added. The circular, which amended certain annexes of the Manual Regulations of Banks (MORB), was issued on Nov. 16 and will take effect 15 days after publication on newspapers. “This is part of the screen to only let in quality major bank shareholders,” BSP Deputy Governor Nestor Espenilla Jr. said in a text message yesterday.
For her part, BSP Assistant Governor Ma. Dolores Yuvienco told reporters regulators want to ensure the stability of the banking system. “The returns will show your financial capacity‐if you really have the means to establish or acquire a bank. Of course, in this manner, we will be sure of the bank’s stability,” she explained. The agency clearances, meanwhile, will validate the “integrity” of the bank owners and directors, Yuvienco said on the sidelines of the Rural Bankers Association of the Philippines anniversary. She said BSP would want to avoid a situation when fronts are being used just to secure bank application approvals. “We want to be proactive on this,” she added. Other requirements provided on the MORB were retained such as statements of assets, liabilities and net worth and justification and detailed plan of bank operation. http://www.philstar.com/business/2012/11/23/871153/bsp‐tightens‐rules‐bank‐ownership
BSP okays China Bank purchase of Unity Bank By Donnabelle L. Gatdula (The Philippine Star) | Updated November 23, 2012 ‐ 12:00am
MANILA, Philippines ‐ The Bangko Sentral ng Pilipinas (BSP) has approved China Banking Corp.’s purchase of Pampanga‐based Unity Bank for about P400 million, a company disclosure said. China Bank informed the Philippine Stock Exchange that the BSP’s Monetary Board cleared the acquisition on Nov. 15 and was relayed to the bank on Nov. 20. The BSP said China Bank will be allowed to acquire 99.95 percent of the outstanding subscribed capital stock of Unity Bank, which has 15 branches. China Bank should be able to merge within six months the Unity Bank with its subsidiary, China Bank Savings Inc. (CBSI), subject to meeting certain requirements and submission of pertinent documents. The Monetary Board approval also included the waiver of licensing fees for 18 branches to be opened in restricted areas and another six branches upon final approval of the CBSI and Unity Bank merger, for a total of 39 branches. In line with the purchase, China Bank’s board approved a capital infusion of P360 million to Unity Bank, and to authorize BSP to debit China Bank’s demand deposit account for the capital infusion. Business ( Article MRec ), pagematch: 1, sectionmatch: 1
The board also called for the finalization of the stock and purchase agreement for the purchase of 99.95 percent of outstanding subscribed capital stock of Unity Bank, for a total investment of P400 million. China Bank has appointed Alberto Emilio V. Ramos as the new president of Unity Bank. China Bank, a member of the SM Group of Companies, currently has nearly 300 branches and is on aggressive expansion towards Southern Philippines. In 2014, it targets to grow its branch network to 400. CSBI, on the other hand, has 24 branches spread out nationwide, majority of which are located in restricted areas and areas just outside Metro Manila. By 2014, its network is seen to increase more than four times to 100. http://www.philstar.com/business/2012/11/23/871155/bsp‐okays‐china‐bank‐purchase‐unity‐bank
Businessmen expect ’12 to end on a high note By Prinz P. Magtulis (The Philippine Star) | Updated November 23, 2012 ‐ 12:00am
MANILA, Philippines ‐Businesses are looking to end the year on a high note on the back of strong demand during the holiday season, but are less optimistic at the start of 2013, the Bangko Sentral ng Pilipinas (BSP) yesterday reported. Results of the latest Business Expectations Survey (BES) showed over‐all confidence index improved to 49.5 percent in the fourth quarter from 44.5 percent in the third quarter. The latest figure is the “second highest reading since the nationwide survey started in the fourth quarter of 2006,” the survey said. The confidence index (CI) is computed as the percentage of respondents who answered in the affirmative less percentage of those that answered in the negative with respect to views on specific indicators. “The sentiment was very strong for the fourth quarter because of the holiday season and main harvest season,” BSP assistant governor Ma. Cyd Tuaño‐Amador told reporters in a briefing. “There was a seasonal and expected bounce in the enthusiasm of business firms in the current quarter,” she added. Business ( Article MRec ), pagematch: 1, sectionmatch: 1
Consumer spending is usually high during the holidays as Filipinos spend more for their needs and gifts, thereby allowing firms to expand production. Aside from the expected Christmas rush, optimism for the current quarter was driven by expansion of businesses and new product lines, favorable macroeconomic conditions, introduction of new and enhanced business strategies, possible credit rating upgrade and continued confidence in the Aquino administration. Businesses based in the National Capital Region were more positive compared to those in other regions although both posted improved sentiments, the survey showed. NCR CI went up to 54.5 percent from 48.9 percent, while those in other regions increased to 41.1 percent from 31.9 percent. As demand however usually slows down after the holidays, firms turned “less sanguine” with the index declining to 43.8 percent, BES results showed. “It was a typical and seasonally determined downtrend in business expectations next quarter,” Tuaño‐Amador said. Firms were also concerned about the possibility of tight supply for raw materials and low sugar prices in the world market that affected the local sentiment, the survey said. Tuaño‐Amador however said the still positive index indicate the economy can bank on businesses to drive economic growth next year, when a higher six‐ to seven‐percent target is aimed. The local economy grew by 6.1 percent as of the first half of 2012. “There seems to be indication then we could see some support from business which could provide support to investment and of course better consumption activities which could also lift growth in the near term,” she explained. A total of 1,576 businesses nationwide were polled with a response rate of 75.1 percent. The survey was conducted from Oct. 1 to Nov. 15. http://www.philstar.com/business/2012/11/23/871151/businessmen‐expect‐%E2%80%9912‐end‐high‐note
Urdaneta landfill agrees to take Baguio garbage By Artemio Dumlao (The Philippine Star) | Updated November 23, 2012 ‐ 12:00am 0 0 googleplus0 0 BAGUIO CITY, Philippines – The search for a dump for this city’s more than 200‐ton daily garbage ended yesterday after a sanitary landfill in Urdaneta City, Pangasinan finally allowed the waste in its facility. Mayor Mauricio Domogan said in a statement that the waste disposal area they found in Urdaneta charges lower and is nearer than the private landfill in Capas, Tarlac. Domogan has reportedly forged an agreement with the liaison officer of the Urdaneta landfill for the dumping of the waste after the Supreme Court ordered the permanent closure of Baguio’s Irisan dump which collapsed and claimed six lives last year. The trash slide had also “polluted” the water sources in Tuba, Benguet. Domogan said the city government could save P100 for every ton of garbage dumped in the Urdaneta sanitary landfill which charges P800 per ton, aside from savings in fuel and travel cost. Plans to dump garbage elsewhere like in Itogon and Sablan towns in Benguet, Rosario town in La Union, and in Sto. Tomas in Tuba did not push through due to the villagers’ refusal, among other problems. http://www.philstar.com/nation/2012/11/23/871119/urdaneta‐landfill‐agrees‐take‐baguio‐garbage
Support, laws for 'halal' industry urged (philstar.com) | Updated November 22, 2012 ‐ 2:13pm
Zambales Rep. Mitos Magsaysay listens to ARMM Assemblyman Khadafy Mangudadatu raise a point during discussions on the Mindanao "halal" business concept as part of the November 20‐21 investments forum in Buluan town in Maguindanao. ‐ John Unson COTABATO CITY, Philippines ‐ Stakeholders have expressed concern the “halal” industries and business regulation system in Southern Mindanao might fail owing to the lack of support from the national government. Some of the more than 300 participants to the November 20‐21 halal investments forum in Maguindanao’s Buluan town said laws should be immediately enacted to complement the initiative. The Arabic term halal refers to food and medicines that are not “haram,” or forbidden to Muslims. Zambales Rep. Mitos Magsaysay, who addressed participants to the forum, said the national government ought to support the halal businesses in Moro‐dominated areas not just because of its importance to Muslims, but because the industry would generate jobs in the local communities. “This is the kind of program the national government ought to support because halal businesses and industries can provide people with employment,” Magsaysay said. http://www.philstar.com/nation/2012/11/22/870941/support‐laws‐halal‐industry‐urged
Bicam on sin tax set next week By Christina Mendez (The Philippine Star) | Updated November 23, 2012 ‐ 12:00am
MANILA, Philippines ‐ The Senate and the House of Representatives will begin their bicameral conference committee meeting on the sin tax reform bill next week, Sen. Franklin Drilon said yesterday. “We’ll start the bicam at the end of the month because I expect to finish the budget under our schedule by Nov. 28,” Drilon, Senate finance committee chairman, said at the weekly Kapihan sa Senado yesterday. He said the bicameral conference meeting on the sin tax would coincide with the one for the 2013 national budget. “Anyway, the bicam on the sin tax will be both easy. Well, I don’t say easy but I foresee a substantial agreement and I underscore substantial on the cigarette tax because the cigarette tax, we have projected it at about P23.5 billion as against the House version of P26 billion,” Drilon said. Drilon said he is confident the bicameral conference meeting on sin tax will proceed smoothly, citing the House leaders’ declaration that they are amenable to following the Senate version, at least with regard to cigarette tax rates. “It is on the alcohol side which I expect some difficulty because we have assigned about P16 billion for the alcohol excise tax to achieve the 60‐40 ratio,” he said. http://www.philstar.com/headlines/2012/11/23/871371/bicam‐sin‐tax‐set‐next‐week
PNB posts 92.5% growth in 9‐month profit By Daxim L. Lucas Philippine Daily Inquirer 1:37 am | Friday, November 23rd, 2012 Philippine National Bank on Thursday reported a surge in its earnings as of the end of the third quarter of the year, coinciding with a frenzy of rumors following the lack of fresh developments on its reported merger plans with Bank of the Philippine Islands. In a statement, PNB said its net income grew by 92.5 percent to P3.8 billion as of the end of September, compared to year‐ago level. The bank said its latest income figure translated to a return on equity of 14 percent for the period, an improvement over the 9‐ percent return for the third quarter of 2011. The trading of the shares of both PNB and Ayala‐controlled BPI on the Philippine Stock Exchange resumed Thursday, with neither bank announcing any fresh developments in their talks. The silence on both parties came amid rumors that talks between both lenders are on the rocks, following a supposed counter‐ offer made to Tan by BDO Universal Bank of the Sy family. A ranking BDO official, however, denied that the bank had come into the picture of the BPI‐PNB deal. An official of the Ayala group—speaking on condition of anonymity—conceded that negotiations between the two parties were “encountering issues that have yet to be ironed out.” In the meantime, PNB said Thursday its total operating income was up 32 percent to P14.1 billion, largely accounted for by improvements in interest income from loans and receivables, reduction in interest expense and net gains from trading and investment securities. Net gain on trading and investment securities was up 13 times over year‐ago level, from P315.2 million to P4 billion, by the close of the third quarter due to the gain in the sale and redemption of available‐for‐sale securities. PNB beefed up its inventory of available‐for‐sale investments by 18 percent, or P9.3 billion, versus end‐2011. Net profit on foreign exchange was likewise up 31 percent. Interest income on loans and receivables grew by 3 percent, or higher by P184 million, due mainly to the continuous drive to shore up lending across segments: top‐tier corporations; SME and middle markets; and retail for consumer loans. Loans and receivables grew by P4.2 billion to close at P130.4 billion. Non‐performing loans dropped further to P6.5 billion compared to P6.9 billion as of the end of 2011. The bank also made significant headway in building its consumer loans business. Home and auto loan bookings grew by over 100 percent and 30 percent, respectively, year on year, surpassing 2011 levels as of the end of the third quarter this year. The bank also reported a 19‐percent reduction in interest expense year on year owing mainly to an improvement in the average cost of funds given the deliberate move to focus on generating low‐cost deposits. The decrease in high‐cost term placements was partly offset by the P1.7‐billion increase in savings deposits. PNB’s deposit levels stood at P235.9 billion.
Administrative and other operating expenses were up 18 percent due to the accrual of adequate provisions for loss on legal cases and fire loss on a certain property. http://business.inquirer.net/94511/pnb‐posts‐92‐5‐growth‐in‐9‐month‐profit
As I See It
Business district in North Triangle a bad idea By Neal H. Cruz Philippine Daily Inquirer 10:10 pm | Thursday, November 22nd, 2012 Here is the latest chapter in the fight over the nurseries of Manila Seedling Bank Foundation (MSBF) on Quezon Avenue, Quezon City. Background: During the Marcos administration, a 7‐hectare property owned by the National Housing Authority (NHA) was granted in usufruct to MSBF, so that the latter could grow seedlings for the government reforestation projects, with some to be sold to home gardeners. In December 2005, the Quezon City government sold the property at public auction—allegedly for MSBF’s failure to pay real estate taxes—wherein the QC government was the highest bidder. MSBF filed a case in court contesting the sale. On Oct. 6, 2009, the QC Regional Trial Court nullified the sale for lack of due process. Early this year, City Hall tried again to grab the property, this time sending a contingent of city workers aided by 100 QC policemen. They padlocked the gates to prevent anyone from entering or leaving, claimed ownership of the property, and forced the gardener‐tenants to pay rent to City Hall. MSBF filed antigraft cases at the Office of the Ombudsman against city and police officials for the raid, and against the NHA manager for not taking sufficient steps to stop the City Hall takeover in spite of the fact that NHA, as owner, is by law exempt from the payment of real estate taxes. In their reply, officials led by Mayor Herbert Bautista and City Administrator Victor Endriga said that they acted in good faith, that their actions had the “presumption of regularity,” and that they had sent MSBF notices of delinquency before the takeover. For his part, NHA manager Chito Cruz said he had sent City Hall letters stating that NHA is exempt by law from paying real estate taxes and that the sale of the 7‐hectare property is illegal. MSBF issued a reply‐affidavit noting that NHA merely stopped there and “no longer sought other available legal remedies, such as … appropriate court action.” This “abstention … enabled [City Hall] to freely proceed with [its] illegal act,” it said. MSBF also said City Hall’s notice of delinquency to the foundation, without a notice of assessment, did not fulfill the requirements of due process as enunciated by the Supreme Court. The RTC agreed with this view and declared that the takeover was illegal and null and void. In its decision, the RTC declared: “Inasmuch as no prior notice of assessment was served, there is no basis to collect any tax liability, no obligation arose on the part of the Plaintiff to pay the amount of real property taxes sought to be collected. Consequently, Plaintiff never became delinquent in the payment of said taxes to defendant Quezon City, and the latter never acquired any right to sell the subject property in a public auction.” In spite of this decision, City Hall continues to exercise control over MSBF’s usufruct property and to force the tenant‐gardeners to pay rent to it and not to the foundation. But why is City Hall salivating over the property, to the extent of resorting to “unlawful, illegal and unconstitutional measures”? It is because of its obsession to have the property absorbed by the P22‐billion joint venture of NHA and Ayala Land Inc. to develop the 29‐hectare property in North Triangle into a Central Business District where, according to Mayor Bautista’s chief of
staff Aldrin Duna, “a high‐rise convention center will be put up in the area facing Edsa.” (As I said in an earlier column, Ayala Land should be ashamed of its role in this illegal action.) A newspaper report quoted Administrator Endriga as saying that “Japan’s Mitsubishi Electric Corp. wanted to buy the 7‐hectare property for P100,000 per square meter to put up the second tallest tower in the world, next to Tokyo’s 634‐meter Sky Tree.” The greed is so strong that City Hall even wants to grab the Veterans Memorial Medical Center compound and the Ninoy Aquino Wildlife Center to make them a part of this Central Business District. QC officials are obviously envious of the cities of Makati and Taguig, which have high‐rise commercial and residential buildings in their commercial districts. Regarding this ambition of having a Central Business District in the North Triangle area, I strongly urge our officials to give it a second hard look, and for the residents in and around the area to strongly oppose it. First, do you realize what will happen if this area is filled up with tall commercial buildings? The traffic will be terrible. It is terrible now because of the presence of three giant shopping malls there—Trinoma, SM North Edsa and The Block—but��it will be many times more terrible if a business district is built there. It will be much, much worse than Edsa during rush hours. Imagine the tens of thousands of vehicles clogging Elliptical Road, Commonwealth Avenue, Quezon Avenue, North, South, East, and West Avenues, Luzon, Visayas and Mindanao Avenues, and all the other peripheral streets. Residents of Philamlife, Project 6, Tierra Pura, Miranila and other neighboring villages will find it difficult to drive to and from their homes because of the traffic. And think of the water requirements of that Central Business District. Much of the water supply of neighboring villages will be sucked up by the district’s buildings. Also think of the air quality in the area. The tens of thousands of vehicles and the hundreds of thousands of people doing business there will all pollute the air. Right now, the air there is clean because of the open spaces and greenery. That will change once the Central Business District—which Quezon City does not need—becomes a reality. Junk that crazy idea. http://opinion.inquirer.net/41331/business‐district‐in‐north‐triangle‐a‐bad‐idea
Peking duck smuggling fails By Joel E. Zurbano | Posted on Nov. 23, 2012 at 12:00am | 168 views
The Customs bureau has filed criminal charges against a trader and his broker over the foiled smuggling of frozen pigeon, chicken and Peking duck from China worth P40 million last month. Commissioner Ruffy Biazon said Miguel Villaflor, of Hexa Trading, and Remedios Lopez were responsible for the arrival of two 40-foot reefers at the Port of Manila on Oct. 15. He said the shipment was misdeclared as frozen mackerel. “The Bureau of Customs will never allow scheming traders like Hexa Trading to be left untouched, no matter who they are connected with, if only to ensure the collection of proper duties and taxes,” Biazon said. Agents of the bureau’s X-ray Inspection Project headed by lawyer Ma. Lourdes Mangaoang seized the shipment following a 100 percent examination of the two container vans. Biazon ordered a more rigid inspection of refrigerated shipping containers to protect food producers against the entry of smuggled agricultural goods. Mangaoang said reefers now undergo x-ray before the 10 percent spot examination at the designated port of entry. In the case of a suspicious cargo, “we put the reefer under alert and have the xray officer accompany the examiner to the cold storage facility to either clear or seize the goods, depending on the findings of the strip examination,” she noted. Tweet http://manilastandardtoday.com/2012/11/23/peking-duck-smuggling-fails/
What’s the actual state of PNoy’s health? By Sara Susanne D. Fabunan | Posted on Nov. 23, 2012 at 12:01am | 643 views
First a bum stomach, then coughs and colds and flu in the past several days that caused him to miss state functions, but a Malacañang spokesman said on Wednesday President Aquino “is now feeling better.”
But a minority member of the House of Representatives, Isabela Rep. Rodolfo Albano, said Mr. Aquino should see a doctor because “the health condition of the President is a cause for concern in light of his repeated bouts of colds, flu and cough recently.” “Good health is vital for the President to perform well and effectively lead our nation,” Albano said. Mr. Aquino, a smoker, failed poorly in his effort to suppress his coughs during public appearances, including live television interviews. In the past several days, he spoke in hoarse voice and he sounded like he was trying to scare reporters. During the debate in the Senate in the past few days over exorbitant taxes on cigarettes, the subject about the President’s smoking habits as a cause of his cough, came up. It enraged Presidential spokesman Edwin Lacierda, who denied Aquino’s coughing is due to smoking.
Lacierda said Aquino was looking forward to get rest during the weekend because “he has not had the two day rest recommended by his physicians.” Cabinet Secretary Rene Almendras said that the bum stomach, which the president suffered during a state visit to Australia and New Zealand two weeks ago, and the flu and inflammation of the nasal airways during the summit with Asian leaders in Cambodia last week, were not related. “When you get flu, its flu. In Australia, it was a bum stomach,” Almendras said. Almendras said it was normal for any person to get sick, especially for a president of a country, who has a big responsibility. “You get sick when you have many problems. ‘There are many stressful things that create problems,” Almendras said. But Albano said the president should undergo an executive medical check-up to determine his state of health because people were concerned when he left a gala dinner for Asian heads of state and other world leaders in Cambodia because he needed to rest. Before the summit he had to cancel an appointment with International Monetary Fund Managing Director Christine Legarde because he had flu, cough and colds, Albano said. “While we surmise fatigue may have triggered the recurring sickness of the President, we believe it is still best for him to have an immediate executive check up to determine the underlying cause of his condition and his true state of health,” Albano said. With Maricel V. Cruz http://manilastandardtoday.com/2012/11/23/whats‐the‐actual‐state‐of‐pnoys‐health/
Mindanao peace deal reaps $85m from Aussies By Gigi Munoz-David | Posted on Nov. 23, 2012 at 12:01am | 206 views The benefits of the peace agreement between the government and the Moro International Liberation Front have started to materialize with the Australian granting an Aus$85 million aimed at making investments in education. Education Secretary Armin Luistro said the Basic Education Assistance for Muslim Mindanao bankrolled by Australia is a step toward a steady improvement in the quality of basic education in the Autonomous Region in Muslim Mindanao. “The success of this endeavor will mean much not only to the children of ARMM but to all Filipinos. We have started a spark, it is a spark that should reach every community, every household, every child in Muslim Mindanao. This spark will become a real beam of hope to Muslims and to all Filipinos,” Luistro said. The program’s resources will be utilized to boost programs in kindergarten education and upgrade the reading program for young learners, he said. The grant that is the single largest donation given to a region, will also finance improvement in the Madaris education, strengthen technical vocational programs for out-of-school youths, build more classrooms and open more schools in the ARMM, he said. “This project will benefit the last, the lost and the least in the most isolated barangays in the ARMM,” he said. BEAM will cover five provinces and two cities. Specifically, the program targets 95 percent of ARMM public schools, benefiting 2,347 public elementary and secondary schools, 50 private madaris, 2,382 Conditional Cash Transfer (CCT) recipient barangays, 300 barangays without public elementary schools, and 20,000 out-of-school youths.
Ex-PCSO official withdrew P337m fund By Manila Standard Today | Posted on Nov. 23, 2012 at 12:01am | 583 views
A former ranking official of the Philippine Charity Sweepstakes Office (PCSO) withdrew a whopping P337.68 million in confidential intelligence funds (CIF) in the last three years of the Arroyo administration, according to data from the gaming firm’s treasury department. According to Mercedes Hinayon, acting manager of the PCSO treasury department, former PCSO general manager Rosario Uriarte withdrew P352.68 from the PCSO’s CIF from 2008 to June 2010. The amount exceeded her office’s authorized CIF allocation of just P15 million for the three-year period by P337.68 million. Hinayon said the general manager and the chairman of PCSO were entitled to receive an annual CIF allocation of P 5 million each. The CIF was first implemented during the Estrada administration upon the request of former PCSO chairman Rosario N. Lopez to finance the charitable activities and projects of the agency to the poorest of the poor, especially those in far-flung provinces. Hinayon said Uriarte withdrew P138.22 million from the CIF from January to June of 2010 alone. Uriarte made 11 withdrawals in the six-month period, just before President Aquino assumed office in July 2010. This was on top of the P 132.76 million she withdrew in 2009 and P 81.69 million in 2008. http://manilastandardtoday.com/2012/11/23/ex‐pcso‐official‐withdrew‐p337m‐fund/
Baguio charter revision OKd By Dexter A. See | Posted on Nov. 23, 2012 at 12:01am | 101 views
BAGUIO CITY—A Congress bicameral conference committee recently approved the revisions of the century-old Baguio Charter to recognize the swapping of properties between Baguio and Tuba, Benguet, allowing the direct award of alienable and disposable lands to qualified occupants. The report, signed by Rep. George Arnaiz of the 2nd district of Negros Occidental and Senators Ferdinand Marcos Jr., Gregorio Honasan and Franklin Drilon, harmonized the versions of the measure from the two chambers. House Bill 3759 authored by Rep. Bernardo Vergara provided for direct award but the Senate wanted public bidding. The site of Tuba town hall, and elementary and high school buildings within the 54.7 square kilometer territory of Baguio will be exchanged with Tuba’s property southeast of city limits. Vergara said the revised charter’s provision covering 8 square kilometers of land would add to the coffers of the local government. http://manilastandardtoday.com/category/news/
Retire the SSS loan program By Horace Templo | Posted on Nov. 23, 2012 at 12:01am | 291 views
Filipinos are indeed great improvisers. Give them a screwdriver and soon they will be driving nails without a hammer. For instance, when the Social Security System was established on September 1, 1957 for oldage pensions, it didn’t wait long before engaging in housing loans. Faced with opposition from workers and employers, SSS had to offer ad hoc palliatives that eventually waylaid it from its core mission of pension benefits. Within a month, or on October 1, 1957, SSS had added a housing loan program for its incoming employer and employee “members”. This was implemented in cooperation with the Home Financing Corporation. But by March 30, 1959, SSS was into full-scale housing program, five months ahead of releasing its first old-age pension check. Housing loans, without any clear mandate from law, preceded pensions, the centerpiece of legislated social security benefits. SSS added one-month salary loans on September 16, 1964. During the next 50 years, SSS introduced a multitude of innovative housing and personal loan programs: educational, “Study-Now-Pay-Later Plan”, stock purchase, vacation, restructuring, etc. Special loans were made available for vocational and technical students, overseas contract workers, and for members affected by typhoons, floods, earthquakes, and employment crises. Loans were increased to two-month and three-month salary loans. Interest rates and payment periods were periodically changed. Housing loans expanded to include repair and improvement. Amounts were increased to keep pace with rising construction costs. Like their employees, employers were also allowed to borrow under various programs: investment incentive, small and medium industries, community hospitals, industrial modernization and expansion, tourism projects, livelihood financing, schools and hospitals, post-harvest facilities, cooperatives, computer financing for employers and schools, apartment and dormitory, development of entrepreneurship, etc. Being popular, loans had become synonymous with the social security program. Only the pensioners were not allowed to borrow.
Were loans easy to administer? SSS processed voluminous loan applications; posts and reconciles loan amortizations; examines companies’ loan repayments; and implements amnesty programs to condone loan penalties. These were all activities better spent for pension administration. They added heavy loads instead of propping up an already overburdened pension administration. Queues peaked during school openings and the Christmas season. Housing loan appraisals and releases on the basis of construction progress were often delayed. Borrowers complained of strict, cumbersome documentation requirements. Charges involving extortion and bribery for loan applications outnumbered those for benefit applications. Loans often reached high levels of delinquency. To encourage repayments, amnesty programs with penalty condonation were offered. Delinquency followed by amnesty became a recurring cycle. Loans must first be recovered. Moreover, it should bring in additional net income in support of the overall financial needs of the pension program. When outstanding total loans reached nearly half of assets, interest rates could no longer be offered at concessional or subsidized rates. Members must pay interest to match the returns in other investments. The social security law requires that investments in salary loans could not exceed ten percent of assets. This has been breached. But nobody bothered SSS, except the Commission on Audit which consistently published the violation in its annual reports. To this day, SSS is clueless on how to address this violation. Once started, loans were hard to stop. Moreover, SSS may use only 3 percent of its income from loans to support the program’s operating expenses. This was not enough, necessitating pension contributions to subsidize loans. It is the right of a qualified worker or his beneficiary to receive a social security benefit after meeting the qualifying conditions set by law. A loan is a privilege similar to what a member enjoys from his exclusive club. SSS sets the loan conditions. A loan program could be closed anytime, as its creation and termination are not defined in any law. In fact, SSS discontinued in 1988 its direct housing loans. It re-channeled its housing investments to the National Home Mortgage Financing Corporation, a main implementor of the newly-established Unified Home Lending Program that included private sector’s participation. With the advent of privatization, the new thinking was that government must privatize a number of its activities —housing, in particular. The private sector could do better, it was argued, even in providing social security.
The SSS loans have indeed enabled many Filipinos to acquire their first homes. They have provided members and employers immediate means to overcome their financial woes. But lending is an enterprise also swamped by the private sector. SSS must now reform, phase out and close its loan program. The program has outlived its original use. Instead of supporting pensions, it has become a liability operationally and financially. Worse, its continued operation is in blatant violation and open defiance of the law. This, the SSS must disclose to its borrowers and members. Using the language of pensions, SSS must now retire its loan program. Let a hammer do the nail driving. President Aquino’s economic managers could mandate Pag-IBIG or create another agency to take over small loans similar to how housing agencies took over housing loans during the administration of his mother. Make the private sector handle it. SSS was made for pensions.
CA freezes Aman bank accounts Published on 23 November 2012 Written by Jomar Canlas Senior Reporter
THE Court of Appeals (CA) has issued a freeze order on the assets of Aman Futures Group Inc., the controversial firm implicated in the P12 billion pyramiding scam that victimized some 15,000 people in the Visayas and Mindanao.
The freeze order, contained in a resolution issued by the appellate court, covered 25 bank accounts of the firm and its officials headed by Manuel Amalilio. It aims to secure the money in favor of the victims by saving the assets from possible dissipation. The freeze order covers a period of 20 days. Included in the order are the Land Bank of the Philippines, Bank of the Philippine Islands and other prominent local banks. The CA has also mandated the banks to make a report or return as to the status of the freeze order “within a period of 24 hours from receipt of the same.” The banks are prohibited from approving any withdrawals to be made by the Aman group, including Amalilio and other officials of the beleaguered firm. The said freeze order was issued on the basis of the ex-parte petition filed by the Anti-Money Laundering Council and the Office of the Solicitor General which seeks to avoid the possibility that the funds in the subject bank accounts would be withdrawn and placed beyond the reach of law enforcers.
Unlawful The CA held that it found the existence of probable cause in declaring the said bank deposits or accounts involved or related to it as “proceeds from unlawful activities.” Aside from Amalilio, also covered by the freeze order are the bank accounts of Fernando Luna, Lelian Lim Gan, Eduard Lim, William Fuentes, Naezelle Rodriguez and Lurix Lopez. Recently, the primary respondents in the controversial investment scam were summoned by the Department of Justice (DOJ). The Justice department has also issued subpoenas against 37 officers and agents of Aman: Isagani Laluna, Nimfa Luna, Dhurwin Wenceslao, Donna Coyme, Vanessa Luna, Noel Luna, Reggie Luna, Araceli Pasco, Lezuy Caballero, Marilou Caballero, Rogelio Caballero, Marichu Caballero, Rogelio Caballero, Roderick Luna, Roy Aspera, Mike Heres, Edwin Caballero, Liezel Paner, Connie Paner, Edward Amaro, Marione Tan Paner, Elen Tan, Judy Amaro, Mike Wenceslao, Alfredo Aspera, Grace Empalmado, Ariel Empalmado, Yuyet Dumandan, Toto Roda, Edilberto Cabillo Elmidulan, Shiela Luna Lasaca, Ariel Real, Amay Caballero, Rey Tata Chang, Ernesto Luna, Marcelo Andaleand and Marlou Lasaca. New panel Meanwhile, the DOJ has created another panel of prosecutors to make a case build-up against the Aman Group and its officers. In Department Order No. 989, Justice Secretary Leila de Lima has ordered the creation of a 10-member panel that will assist the National Bureau of Investigation in building up the cases against Aman officials. The new group’s work includes “collection of evidence, case evaluation and build-up, prior to their referral to the special panel of prosecutors” handling the preliminary investigation of the case which is handled by the panel headed by Prosecutor Edna Valenzuela.
The DOJ chief has tapped Senior Asst. State Prosecutor Philip Kimpo as chairman, while SASP Edwin Dayog will sit as vice chairman. Other members of the panel are Asst. State Prosecutors Nolibien Quiambao, Hjalmar Quintana, Diosdado Solidum Jr., Michael Aragon Vito Cruz, Florencio dela Cruz, Gerard Gaerlan, John Benedict Medina and Ma. Kristhina Paat-Salumbides. http://www.manilatimes.net/index.php/news/top‐stories/35864‐ca‐freezes‐aman‐bank‐accounts
Posted on November 22, 2012 10:46:38 PM By Diane Claire J. Jiao, Senior Reporter
Business sentiment up BUSINESS CONFIDENCE recovered strongly this quarter as firms expected improvements in their operations and the macroeconomy, the Bangko Sentral ng Pilipinas (BSP) reported yesterday. Business confidence, as measured by the overall confidence index of the Business Expectations Survey BSP released yesterday, hit 49.5% in the October-December period. It dwarfed the 38.7% the year before and the 42.5% in the previous quarter. It was also the second highest score notched since the survey started in 2007, topped only by the 50.6% posted in the fourth quarter of 2010, the central bank noted. The latest survey, which covered 1,576 respondents, was conducted from October 1 to November 15. Citing reasons for their optimism, respondents said they expected increased production due to higher orders and more projects, increased consumer demand during the holidays and the harvest season, expanded product lines and enhanced business strategies. The stable macroeconomy also spurred confidence. Respondents attributed their optimism to stable inflation, low interest rates, strong foreign investment inflows, steady overseas remittances, possible credit rating upgrades, raised growth forecasts and confidence in the Aquino administration. "The sentiment of businesses in the Philippines mirrored the improved business outlook in China and India, and was in contrast to the unchanged or less buoyant sentiment in neighboring countries such as Singapore, Korea, Hong Kong SAR (Special Administrative Region) and New Zealand," the the central bank said. By area, the rosy outlook was shared by businesses both in Metro Manila and in areas outside the capital. By type, importers and exporters alike were more upbeat this quarter, with the former the most optimistic and the latter the most improved. But dual-activity firms -- dabbling both in imports and exports -- held a dim outlook, affected by the ban on fishing in the Visayan Sea and in waters off Zamboanga Peninsula and on the use of plastic bags. By sector, services led the confidence index, followed by wholesale and retail and construction. Industry saw optimism drop. "The business confidence should lend greater support to the GDP (gross domestic product) in the near term, particularly to investments and consumption," BSP Assistant Governor Cyd N. Tuaño-Amador said during a press conference yesterday. For the first quarter of 2013, business confidence fell across the board as firms were wary of the seasonal slump at the beginning of the year. The overall confidence index for the next quarter dove to 43.8% from the 59.6% the previous quarter, though it was still better than the 36.1% the year before.
Economy Posted on November 22, 2012 09:17:50 PM By Antonio Siegfrid O. Alegado, Reporter
Congress to unify ‘sin’ tax versions CONGRESS IS SET to reconcile differences between the two chambers’ respective versions of a bill reforming excise taxes on so-called "sin" products by end of November, cementing beliefs that the measure could be signed into law before yearend. "We will start the bicam [bicameral deliberations] at the end of the month," Senator Franklin M. Drilon, acting ways and means committee chairman, told a briefing, referring to the joint bicameral conference committee that will hammer out differences between Senate Bill (SB) No. 3299 and House Bill (HB) No. 5727. The Senate on Tuesday approved SB 3299, while the House of Representatives gave its nod to HB 5727 last June. With the two versions approved, Congress could now the convening of a bicameral committee. For his part, Rep. Isidro T. Ungab (3rd district, Davao City, House ways and means committee chairman said in a text message: "We are still waiting for the official transmittal of the Senate approved bill." "After which, the House will form its representatives to the bicameral conference committee," he added. Mr. Drilon said he sees "with guarded optimism" that a reconciled version will be ready for President Benigno S. C. Aquino III’s signing "before we go on break on Dec. 21." "HARD BARGAINING" While differences on each version’s rates on cigarette will be easily reconciled, Mr. Drilon cautioned that legislators may take time agreeing on the proposed alcohol levy. Noting that differences in revenue targets from increases in cigarette taxes are "not that substantial," he said, "I foresee substantial agreement." But the lawmaker noted that he "expects some difficulty" in reconciling differences on new rates for alcohol taxes. "This is where the hard bargaining will be," said Mr. Drilon. The Senate had targeted P39.5 billion in fresh revenues next year, broken down to P23.55 billion and P15.95 billion from cigarette and alcohol taxes, respectively. The House’s version, meanwhile, is seen to shore-up revenues of P26.87 billion from tobacco and P4.1 billion from liquor for a total of P31 billion. For taxes on distilled spirits, HB 5727 proposes three tiers with specific rates, while SB 3299 wants a single levy combining a specific rate and ad valorem rates that will be increased incrementally. For fermented liquor, both versions propose two tiers.
But the House wants it set at a net retail price of P50.60 and below per liter and P50.60 and above, while the Senate version divides tiers at P22 and below per liter and P22 and above per liter. Senators agreed on a unitary cigarette tax of P26 per pack by 2017. Rates for the current three tiers will be increased beginning next year, and the tiers themselves gradually cut starting 2015. HB 5727, meanwhile, dropped the unitary rate proposed by the Finance department and set two tiers for tobacco products, with standard increases every two years after a transition period beginning 2015. Another contentious provision, Mr. Drilon said, is the Senate’s mandate requiring cigarettes manufactured and sold here to source 15% of Virginia tobacco leaves locally. "There are studies which indicate that this could be contrary to the WTO [World Trade Organization]," he said. "I am personally in agreement with the Senate version," Mr. Ungab said, but noted the need "to thresh out and harmonize conflicting provisions." Reacting to the Mr. Ungab’s statement, Mr. Drilon told reporters: "That is a welcome statement, so we have a good starting point." -- with Monica Joy O. Cantilero
Finance Posted on November 22, 2012 10:53:43 PM
Peso gains on Israel-Hamas truce THE PESO strengthened against the dollar for the fourth straight trading session yesterday on news of a ceasefire between Israel and the Gaza Strip’s Hamas rulers. The local unit gained seven centavos to settle at P41.075 per dollar against its P41.145-per-dollar finish the previous day. It has appreciated by a total of 25.5 centavos as of yesterday against its P41.33 to the dollar finish on Nov. 16. “The peso, along with other Asian currencies, was boosted by news of a ceasefire agreement between Israelis and Hamas,” a trader said in a phone interview yesterday. In a separate phone interview, another trader said: “Optimism that European leaders and the International Monetary Fund will reach an agreement and release Athens’ bailout package next week also buoyed the peso.” Both traders said the Bangko Sentral purchased dollars when the local unit traded within the P41.065- to P41.10-per-dollar range to temper its sharp appreciation. If it had not, the peso would have finished stronger, the first trader said. -- Ann Rozainne R. Gregorio
6 candidates eyed for next BSP SPC chief • •
Written by Ed Velasco
Friday, 23 November 2012 00:00
A sensitive post at the Bangko Sentral ng Pilipinas (BSP) is set for filling up beginning Jan. 7, 2013, the day when assistant governor and Security Plant Complex (SPC) chief Manuel Torres retires. The assistant governor will celebrate his 65th birthday a day before that day. Due to his leave credits however, he can separate from the service as early as Dec. 15. “My successor will be named by end-November for the very least,” Torres told The Daily Tribune in an exclusive interview at an Italian restaurant in Greenbelt 5. This early, there are six senior BSP officials that are eyed to succeed Torres, according to the retiring official himself. The four are assistant governors Cyd Amador, Rowena Santiago, Vicente Aquino and Dolores Yuvienco and managing directors Gerry Tison and Dr. Johnny Noet Ravalo. Both Amador and Ravalo didn’t reply to Tribune queries when asked for their comments regarding the matter. Under BSP rule, all assistant governors and managing directors are candidates to succeed any retiring official who holds an AG (assistant governor) or DG (deputy governor) rank. According to Torres, there is another official that is capable of succeeding him but due to short service at BSP, the official — engineer Dahlia Luna — is unlikely to be chosen. “In any field, you should have a long record in order for you to be considered for the next higher post. She doesn’t have that,” the assistant governor explained. Luna, just like Torres, is an engineer who has worked as deputy of the retiring official. Torres said he doubts if Amador and Tison would take the SPC chief post because it’s a painstaking job. “You have to work long hours. You can’t leave your office without enough reason,” Torres, a noted mechanical engineer, said. Another reason why the two would be reluctant to accept the post is they are both candidates to replace retiring deputy governor for resource management sector (RMS) Juan de Zuñiga in May 2013. Among the six strong contenders, except Luna, none of them is an engineer like the retiring official. According to Torres, it doesn’t matter whether his successor is an engineer or not. What matters most, he said, is the next one should be knowledgeable in the production matter of notes and coins that are made in billions of pieces. “(My successor) should have prior management experience in a manufacturing setting,” he said.
Torres said there are many former SPC chiefs that were not engineers. Torres, unlike most senior BSP official, didn’t rise from the ranks. He started to work at BSP only in 2007 when then deputy governor for RMS Armando Suratos invited him to send his resumé.