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Strategic Analysis and Research by the

CENTER FOR STRATEGY, ENTERPRISE & INTELLIGENCE

T H E

‘I’m sorry, it’s for my house. I screwed up.’ ~ Marissa Lapid, wife of Senator Lito Lapid, as quoted by U.S. Customs in explaining the $50,000 in her luggage she failed to fully declare

Report

Volume 2 - Number 4 • January 30 - February 6, 2012

‘We’re not buying a house. That amount would not be enough. … She had no intention to lie to authorities. She was just nervous.’ ~ Senator Lapid denying the $50,000 was to buy a house

4 Vicar from the Vatican

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15 Cha Cha’s New Steps

New Manila Archbishop Luis Antonio Tagle combines pastoral rapport, media savvy, worldclass theology, and Vatican ties all the way to the Pope. He will need those strengths at Asia’s premier prelature — and maybe higher • Premier archdiocese: For centuries, the arena for Church vs. State • Your Grace: From Salazar to Sin and Rosales, lessons from past archbishops • Tagle’s tenets: From priestly formation to the pro-life fight, Archbishop Tagle spells out his deep beliefs and strong advocacies

It’s not a Palace priority, but charter change advocates are readying proposals just in case the President decides to tinker with his mother’s Constitution • From 1899 to 1987: The country‘s fundamental law from Emilio Aguinaldo to Corazon Aquino • Surveys, surveys: Will Filipinos vote for cha cha? • Con-con, con-as, or PI: Three ways to refine, revise or revamp

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24 Who Really Rules Pyongyang?

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32 The Virtual Way to Profit

Despite his litany of titles and positions, not everyone is convinced that new ‘Great Leader’ Kim Jong Un really leads. Get set for more tense and testy times ahead • One Korea: The high cost of bringing North and South together, and why Pyongyang and Beijing aren’t hot about it

With 30 million Filipinos online, is digital media the way to go for advertisers? • Video gains: How Youtube can boost your bottom line • Digital divide: Turning unwired masses to wired markets

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39 Hospitals to the Planet

The Philippines churns out doctors and nurses for the globe. But the country needs to do much more to compete in the medical tourism race • Regional bonanza: How the 1997 crisis made Asia the world’s clinic • Dial M for medicine: Where to go for which ailments and what treatments • Top rank: Four Philippine hospitals get world-class accreditation

48 High Tech Trends in 2012

POINT & CLICK

From mobile gear and women’s whims to Asia‘s mega-market, consumers are dictating the future of technology • On and off, in and out: The ups and downs of winners and losers in the global gadget games — and what forces made their days

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You can access online research via the Internet by clicking phrases in blue

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Center for Strategy, Enterprise & Intelligence provides expertise in strategy and management, enterprise development, intelligence, Internet and media. For subscriptions, research, and advisory services, please e-mail report@censeisolutions.com or call/fax +63-2-5311182. Links to online material on public websites are current as of the week prior to the publication date, but might be removed without warning. Publishers of linked content should e-mail us or contact us by fax if they do not wish their websites to be linked to our material in the future.


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Resident Catholic Journalist Zandro G. Rapadas, author of this week’s lead story, is a Catholic journalist since college. He was former editor of ‘Witness,’ the religion section of The Varsitarian, official student publication of the Pontifical and Royal University of Santo Tomas (UST). In 1999, he received, together with the Varsitarian staff, the University’s ‘Pope Leo XIII Award’ for services rendered to the Thomasian community. Rapadas went on to become writer and researcher at the media office of the Archdiocese of Manila in 1999, where he wrote press releases and features published in the Arzobispado’s official publication, Vademecum, as well as in major dailies. He wrote the biography of then Manila Archbishop, Jaime Cardinal Sin for the New Catholic Encyclopedia published by the Catholic University of America and Gale Group in 2000. In the same year, the Holy See Press Office gave him accreditation for his coverage of the World Youth Day events in Rome.

Aside from his work in cenSEI, Don Rapadas is also part of Bahay ng Diyos Foundation, which helps in the refurbishment of parish churches throughout the Philippines

He wrote personality profiles of Cardinal Sin and Bishop Socrates Villegas on the Philippine Daily Inquirer in 2001, and of Gaudencio Cardinal Rosales in the international Catholic quarterly, Rogate Ergo Asia magazine in 2003. In 2004, his feature on Filipino lay evangelist, Bo Sanchez, won as Best Special Feature on Print at the 26th Catholic Mass Media Awards.

He wrote the news-feature on Archbishop Tagle with a perspective of a long-time Church observer and communicator and the fervor of a lay faithful that sees much hope in Tagle’s pastoral administration of the Archdiocese of Manila. The feature is historical and contextual, and introduces the person of the new premier cleric in the light of his own doctrines, accomplishments, and advocacies. It is a critical reading of the new pastor and the landscape where he will tend his flock. Rapadas holds a Bachelor’s degree in Psychology from UST (1999), and a Master’s degree in Development Communication from the University of the Philippines Open University (2007), where he also served as alumni president (2008-2011). He is currently pursuing his Ph.D. program at the University of the Philippines College of Mass Communication. Rapadas is also a Senior Analyst and Business Development Executive at the Center for Strategy, Enterprise & Intelligence (cenSEI).


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NATION Archbishop Luis Antonio G. Tagle

A Premier Cleric for the Premier Archdiocese By Don G. Rapadas, M.D.C.

As part of the Vatican’s International Theological Commission in the 1990s, Fr. Luis Antonio Tagle was the youngest among the 30 leading theologians convened to advise the Pope. So it was doubly amazing to the commission head at the time, Cardinal Joseph Ratzinger, when Fr. Tagle’s first draft of a paper won approval with no revisions from any of the commission members.

the highest Catholic Church position in the Philippines and Asia.

As he turned to the last theologian for comment on the Tagle draft, Ratzinger noted that in the commission’s history, never had a first draft been approved without any change. After the last member gave his full approval sans amendment, the German cardinal went to the Filipino priest and raised the latter’s hand as if proclaiming a new boxing champion.

The appointment was well talked about, not just because of the events surrounding it (e.g., the recent Reproductive Health Bill debates in Congress and the Philippine Charity Sweepstake Office fund mess that involved certain local bishops) and the stature of the Archdiocese of Manila, but also because of the popularity of the new Archbishop himself.

Last October, Ratzinger — now Pope Benedict XVI — again lifted the hand of Tagle, who was by then the bishop of Imus diocese, appointing him to what is arguably

Coming from Imus diocese, where he served for nine years, Archbishop Luis Antonio Gokim Tagle, a native of Manila, is known locally and abroad for his eloquence

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Bishop Luis Tagle of Imus diocese was appointed the new Archbishop of Manila, the premier ecclesiastical province in the Philippines, on October 13, 2011, succeeding Gaudencio Cardinal Rosales, whose retirement was accepted after serving as archbishop since 2003.

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as a preacher, a ministry that he has taken from traditional book-writing and lectures at conferences and retreats to the more modern platforms of broadcast and social media.

sanctity of marriage, and that he did not see Archbishop Tagle interfering in strictly secular and divisive political events.

Archbishop Tagle has charisma and popularity to spare, but he is not as politically charged as the late Cardinal He is youthful and dynamic, but prefers Sin. He can be as low-profile as Cardinal the simple life, taking buses to work, and Rosales, but he is a staunch defender of conducting himself with humility of word morals and decency, as his immediate and action. He is also the cleric who has predecessors were. He has a Facebook brought the congregation to tears at the account with over 85,000 “likes,” he is seen Eucharistic Congress in Quebec, Canada, daily on national television with his bible in 2008, for his moving speech about the reflections and relevance of the catechetical notes, Eucharist in our and his program, lives, the insightful “Word Exposed,” author who produced by Jesuit wrote about the Communications, is Church’s response seen on YouTube. to the clergy crisis But Archbishop involving sexual Tagle also abuses. appreciates solitude in deep prayer. On Tough act to closer analysis, he follow, big shoes Tagle is the first native of Manila to become its Archbishop is more likely to to fill. perform his new Former Chief task as Archbishop of Manila amid Justice Artemio Panganiban, an admirer, asked in a Philippine Daily Inquirer column such contrasts. a few days after Archbishop Tagle’s Dec. 12 As Bishop Bacani once said of Archbishop installation: Does Archbishop Tagle have an Tagle, “He is a person in whom one sees activist streak? Does he have an inclination a very rare and integrated combination to lead another People Power revolution? of a theologian’s mind, a musician’s soul, Will he speak out on public issues? Or will a pastor’s heart. In him the search for he be conservative and stay close to faith truth and love of God and people have and morals? In trying to answer those been joined in a remarkable degree. He questions himself, Panganiban took note is not only a brilliant scholar but also a of the new archbishop’s articulation of the persuasive communicator. And he is not theology of faith, life, marriage, and social only intelligent and holy but a friend to reforms, and concluded on that basis that many, while having a particular love for the Archbishop Tagle would be firm on social poor and priests.” issues, such as the right to life and the

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Archbishop Tagle’s educational and clerical background His Excellency Most Reverend LUIS ANTONIO GOKIM TAGLE Birth: 21 June 1957 Place: Manila Priesthood: 27 February 1982 Place: Our Lady of Pillar Cathedral, Imus, Cavite Episcopate: 12 December 2001 Place: Our Lady of Pillar Cathedral, Imus, Cavite EDUCATION 1963-1969 Elementary St. Andrew School Parañaque, Manila graduated Valedictorian 1970-1973 High School: St. Andrew School Parañaque, Manila graduated Valedictorian 1974-1977 Philosophy: Ateneo de Manila University and San Jose Seminary graduated Summa Cum Laude

1978-1982 Theology: Ateneo de Manila and San Jose Seminary 1987 Licentiate in Sacred Theology The Catholic University of America Washington, D.C. 1991 Doctorate in Sacred Theology The Catholic University of America Washington, D.C. MINISTERIAL BACKGROUND 1982-1984 Associate Pastor St. Augustine Parish Mendez, Cavite 1982-1983 Spiritual Director Tahanan ng Mabuting Pastol, Tagaytay City 1983-1984 Acting Rector Tahanan ng Mabuting Pastol, Tagaytay City 1984-1985 Rector Tahanan ng Mabuting Pastol, Tagaytay City 1992-present Rector 
Tahanan ng Mabuting Pastol
 Tagaytay City 1993-2000
 Member 
Board of Consultors and

Meanwhile, Patricio Mangubat, a Filipino blogger and Church observer, noted that Tagle “does not wield a sword, but his strong theological understanding gives him the strength to form and command a great army of religious supporters.” But the pomp of installation and welcome cheers are over, and the new Archbishop is faced with serious challenges, not only in his ministry as head of the premier archdiocese in Asia, but also in his capacity as theologian, communicator, and Filipino. RH bill. First up is the Reproductive Health Bill now pending in Congress and which has stirred heated debates between parties in the Church and advocates of the proposed legislation. Archbishop Tagle is known to be strongly opposed to it. In May 2011, on his TV show “The Word Exposed,” Tagle spoke out against the RH bill’s provision mandating sex education

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as early as Grade 5: “The concern of the Church is that in these modules the approach to sex is too clinical. It is only an activity, [and] only factual, biological, on what is said, ‘How can you protect yourself?’ But the sexual act is always part of morality and relationship. And that is what is not being tackled. This is where the biggest concern of the Church lies. Is sex education only just about a technique or how to do it, or [is it] part of the holistic view of man and relationships?” He reiterated his opposition to the bill during his installation as Archbishop of Manila last December 12: “The new evangelization requires putting in the mind and eyes of the Lord again, a transformation coming from prayer. Then we see differently. A child, especially the unborn is no longer seen as a burden but a gift, the youth are not a problem but a promise, women are not objects but persons,” he said.

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Presbyteral Council of the Diocese of Imus 1993-2000
 Episcopal Vicar for Religious 1993-1995
 Member 
Diocesan Commission on the Clergy 1993-1995
 Member
 Diocesan Commission on the Clergy 1998-2001
 Parish Priest
Our Lady of the Pillar Cathedral, Imus, Cavite 2001-present
Bishop of Imus OTHER MINISTRIES 1982-1985
 Instructor of Theology
 San Carlos Seminary (Manila) 
Loyola School of Theology (Manila)
Divine Word Seminary (Tagaytay) 1992-present
 Instructor of Theology 
Loyola School of Theology (Manila) 
Divine Word Seminary (Tagaytay) 1992-1995
 Instructor of Theology
 Maryhill School of Theology (Manila) 1994-2001
 Facilitator
 CBCP National Ongoing

Formation of Priests 1995-2001
 Consultant 
Catholic Bishops’ Conference of the Philippines (CBCP)
 Commission on Doctrine of Faith
 Commission on Seminaries 1995-present
 Member 
Editorial Board
 Storia del Concilia Vaticano II, Instituot per le scienze religiose 
Bologna, Italy 1995-2000
 Presenter and Member of the Drafting Committee
 VI and VII Plenary Assembly of the Federation of Asian Bishops’ Conference (FABC) 1997
 Member
 International Theological Commission
Vatican City 1998
 Expert 
Special Assembly of the Synod of Bishops for Asia
Vatican City 
Member 
Ordinary Council of the General Secretariat of the Synod of Bishops 
Vatican City Present
Chairman 
Episcopal Commission on the Doctrine of Faith

As head of the CBCP Episcopal Commission their stories of struggle are hardly talked on the Doctrine of the Faith, he co-signed about, if not suppressed by those who the bishops’ collective decision to pull out of should care to help. “The poor, the girlRH Bill talks with government, which stated child, women, refugees, migrants, the that “there’s no reason to further undertake minorities, the indigenous peoples, the a serious study/dialogue in victims of different types House Bill 4244 with the “Love makes one of domestic, political, administration as proposed a true shepherd, ethnic violence and the by President Aquino environment are but a few not position. I pray himself.” The Catholic of those whose stories are that my Episcopal Church is opposing the suppressed . . . In Asia the ministry and all passage of the bill because Church will allow itself to it promotes the use of be the storyteller of the in the Church artificial contraception and may be rooted in voiceless so that Jesus’ on introducing sex education voice may be heard in their humble and loving in grade school, among other suppressed stories,” he said. discipleship.” items contested. While Bishop of Imus, he ~ Luis Antonio On social justice. In expressed serious concern Gokim Tagle various speeches and about what seemed to be articles, Archbishop Tagle has expressed a growing “culture of death” following the a need for the Church to defend the killing of Judge Henrick Gingoyon by two poor and marginalized. In his article, gunmen on a motorcycle near his residence “Understanding ‘Story’ and ‘Telling Story,’” in Bacoor town, Cavite, in 2005. He noted he noted that the plight of the poor and that, “it is the problem of a culture that is

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Catholicism’s leading archdiocese in Asia Established on February 6, 1579, the Diocese of Manila (precursor of the Archdiocese of Manila) was a suffragan of the Archdiocese of Mexico, and under its jurisdiction were all the Spanish colonies in Asia (A suffragan is a sub-diocese in an archdiocese). Its first bishop was the Dominican friar Domingo de Salazar, and succeeded through the centuries by friars and clerics mostly from Spain, and the rest from the United States and Ireland until the appointment of Filipino clerics in the mid-20th century. When Manila became an archdiocese, its jurisdiction spanned the entire Philippine archipelago, with the Dioceses of Nueva Segovia (North Luzon), Caceres (Southeastern Luzon), and Cebu (Visayas and Mindanao) as suffragans. Later on, more dioceses were carved out from it as the number of Catholic faithful and parish communities grew over the years. The most recent restructuring occurred in late 2002, when the Holy See carved out from it Novaliches and Parañaque dioceses, and then Cubao, Kalookan, and Pasig dioceses in 2003. The Archdiocese of Manila now covers Manila proper, Makati, Mandaluyong, San Juan, and Pasay. Manila archdiocese owned vast tracts of land and other properties where its parishes, seminaries, convents, schools, and other facilities stood. Through the centuries, some of these were sold to government and private entities, while the rest continue to be used for its ministry and mission, while others have been converted into profit-earning enterprises. The Archdiocese of Manila has even invested in huge shares of stocks in big corporations, such as Bank of the Philippine Islands, San Miguel Corporation, and Philex Mining, among others. losing respect for people, not just in the Philippines ... (but) worldwide,” as reported in the Union of Catholic Asian News at the time. His strong advocacy of social justice and protection of the environment were also marked in his installation speech, when he said: “Laborers are not machines but partners, the poor are not a nuisance but our jewels, and the creation is not an object of manipulation but a sign of God’s sustaining love. On dialogue. Although he is believed to be close to the family of President Benigno S. Aquino III, Tagle has shown his independence with his strong opposition to the Aquino-backed RH bill, as well as with his decision last Christmas season to celebrate Mass at the Supreme Court and

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hold a meeting with beleaguered Chief Justice Renato Corona, who is now in the middle of impeachment proceedings. His openness to listen gives us an idea of how he might handle issues that involve the Church and other sectors of society. At the 2008 Synod of Bishops on “The Word of God in the Life and Mission of the Church” at the Vatican, Bishop Tagle spoke about the disposition of listening to God’s Word that leads people to true life. “Events in our world show the tragic effects of the lack of listening: conflicts in families, gaps between generations and nations, and violence. People are trapped in a milieu of monologues, inattentiveness, noise, intolerance and self- absorption. The Church must learn to listen the way God listens and must lend its voice to the voiceless,” he said.

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Former solon and RH bill advocate Risa Hontiveros Baraquel said that Tagle’s respectful and kind-hearted stance will change the tone of debates on the controversial issue. “I think the thing about him that will most make a difference, for the better, in this RH debate, is ‘yung personal disposition niya at saka ‘yung kondukta niya sa debate [his personal disposition and his conduct in debate],’ because that‘s all we ask in any battle –

a fair and honorable engagement,” she said. On being ‘papabile’ (one who could become Pope). Vatican observer John Allen noted that, “some Church watchers in Rome and the Philippines predict that Tagle could be pope someday. He had an illustrious stint at the Catholic University of America as

Archbishop Tagle’s immediate predecessors The Archdiocese of Manila is a cardinal archdiocese, meaning its head traditionally becomes a member of the College of Cardinals in Rome. The first Filipino cleric to wear the “red hat” was Rufino Cardinal Santos, who was Archbishop of Manila from 1953 to 1973, becoming a cardinal in 1960. Cardinal Santos saw the post-war scenario of Manila wherein social, economic, and political growth depended on the upper class and there was growing social injustice, inequality in the distribution of wealth, and serious labor issues. He established Catholic Charities, later on named Caritas Manila, to provide temporal and moral assistance to the poor and underprivileged faithful of the Archdiocese and suffragan dioceses. His successor, the late Jaime Cardinal Sin, was to further the greatness of the Archdiocese of Manila in the Catholic Church with his prophetic courage. Coming from the Archdiocese of Jaro, he served as Archbishop of Manila from 1974 to 2003, and was made a cardinal in 1976. Maintaining that “politics without Christ is the greatest scourge of our nation,” Cardinal Sin was among the first to criticize the injustices committed during Martial Law, when in 1974, he denounced the military raid of Sacred Heart Novitiate in Novaliches; in 1986 he called on the Catholic faithful to the streets and staged the first People Power Revolution

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that ousted the dictator and installed Corazon Aquino as head of the revolutionary government. Cardinal Sin openly opposed the charter-change movement and promotion of contraceptives during the time of President Fidel Ramos, and, in 2000, he denounced the corrupt acts of President Joseph Estrada, and called for a second People Power revolt, which installed a new administration under Gloria Macapagal Arroyo. Archbishop Gaudencio Rosales came from Lipa archdiocese to replace Cardinal Sin in 2003, and became a cardinal in 2006. A less political and more conservative archbishop, Rosales steered the Archdiocese of Manila away from politics and emphasized a direct role for the Church in helping its impoverished flock. He established Pondo ng Pinoy (Fund for the Filipino) in 2004, a community foundation that supports projects for the poor with funds generated mainly from small donations from parishioners and community members, based on a similar fund he had set up in Lipa. By 2010, Cardinal Rosales’ Pondo ng Pinoy had total assets of P81 million. When a state of national emergency was proclaimed in February 2006, Cardinal Rosales asked the Filipinos to pray for peace and unity in the country and expressed the hope that the government would not abuse and curtail the rights of the people. In 2010, Cardinal Rosales issued a pastoral letter expressing the Catholic Church’s condemnation of abortion but recalling the excommunication imposed by the Church on those who procure it or help others to do so.

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10 a scholar and at the Vatican Congregation for the Faith as a theologian, during the time when then Cardinal Joseph Ratzinger (now Pope Benedict XVI) was prefect.

mightier than all of us, Jesus Christ, the Risen One, and the True Shepherd of the Church.” “I tremble before the love that calls me to lead the people to the Lord. But my poor sinful person finds rest in Him who is the Church’s true Shepherd.” With these words, Archbishop Tagle manifested his strong advocacy and commitment to clergy renewal. In fact, a closer reading of his body of work points to it as the core of his ministry.

Allen further noted: “Tagle’s doctoral dissertation at Catholic University, written under Father Joseph Komonchak, was a favorable treatment of the development of episcopal collegiality at the Second Vatican Council. Moreover, Tagle served for 15 years on the editorial The new Archbishop is regarded as one of the board of the leading theological minds among the Asian bishops. Bologna, Italy-based‚ History of Vatican II’ project founded by Giuseppe Alberigo, criticized by some conservatives for an overly progressive reading of the council.”

Confronted with the reported cases of sexual abuses by some local clergy a decade ago, he delivered a speech to the clergy and religious of his Cavite diocese in February 2004, which tackled how the Church’s responds to the said crisis. “At first glance, this crisis seems to be about sexual behavior only. But a closer look at the actual cases reveals that deep theological, spiritual, anthropological, and pastoral questions are involved,” he said.

Clergy renewal. The new Archbishop, espousing humility and selflessness, saw the events of his appointment and installation in Manila as not about him; neither was it about his visions and his plans. Instead, he asked the faithful to focus “on the One

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Tagle went on with his reflection on the priesthood by asking: Why am I in this kind of life? Is it for a sense of grandeur, a sense of authority that the local culture and the Church give? Is it in order to get money the quickest way possible? If I am not clear about my identity and my purpose, then I will not be accountable for my actions as a minister. I am accountable for all my actions as a minister to the extent that I am clear about who I am as a priest and what am I for.”

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A premier cleric for the premier Archdiocese

Tagle’s doctrines (as culled from his installation speech) Focus on Jesus. Don’t look at me; I am not important. My Episcopal Motto says it plainly, ‘Dominus est! It is the Lord!’ My objectives are to follow God’s directions and I intend to accomplish them through faith fueled by prayer and love. On prayer and transformation. When we pray, we are transformed, we see differently: A child, especially the unborn, is no longer seen as a burden but a gift. The youth are not a problem but a promise. Women are not objects but persons. Laborers are not machines but partners. The poor and the differently abled are not nuisance but our jewels. And creation is not an object of manipulation but a sign of God’s sustaining love. On Listening to God’s Word. Listening in faith means opening one’s heart to God’s Word, allowing it to penetrate and transform us, and practicing it. It is equivalent to obedience in faith. Formation in listening is integral to faith formation. On unity. When we take different boats and even compete against each other to get the better portion of the catch for our own teams, we are not engaging in mission. Divisiveness and destructive competition will only help sink the boat. Let us look to the one Shepherd who gathers his sheep instead of scattering them. On the missionary Church. We know that the Lord guards His Church. He keeps watch with us on those long nights of confusion and helplessness in mission. When in spite of our good intentions and efforts there are still multitude of hungry people we cannot feed, homeless people we cannot shelter, battered women and children we cannot protect, cases of corruption and injustice that we cannot remedy, the long night of the disciples in the middle of the sea continues in us. Then we grow in compassion towards our neighbors whose lives seem to be a never-ending dark night. But in our weariness the Lord comes. Advent never ends. He is the shepherd promised in the first reading from Ezekiel. He will come to his sheep where they are scattered when it is cloudy and dark. He is near. He is Emmanuel. But we need to hear his voice and to follow his direction. We need to see realities with His eyes. We need faith. Without faith fueled by love, we cannot truly be a missionary Church of Jesus Christ. On love. Merely assuming the position of Archbishop of Manila does not guarantee that I will recognize the Lord. If I am not careful it might even blind me to the Lord and others. It is rather by being a humble disciple content with love of Jesus that I would see the advent of him whose love propels us to mission. Notice that at this moment the beloved disciple taught Peter. Later Jesus would ask Peter three time if he loved him more than the others. Love makes one a true shepherd, not position. I pray that my Episcopal ministry and all ministries in the Church may be rooted in humble and loving discipleship.

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A Message for the Bishops: Let JESUS Reign By Ricardo Saludo Originally published in The Manila Times, January 25 & 27

For the Catholic Bishops Conference of the Philippines, meeting in plenary on January 28-30. Your Excellencies, greetings in Jesus Christ! At your semi-annual conference this weekend, may this member of the faithful respectfully commend to your enlightened deliberations certain matters of national urgency. Some are already on your agenda, others may not yet be given the attention they deserve. But all these issues have, in this believer’s view, significant impact on the spiritual, moral, and material well-being of your flocks and our republic. For instant and inspired recollection, an acronym is employed for the major concerns most humbly proposed for the CBCP’s pondering, prayer, and pronouncement: JESUS. This holiest of names, it is hoped, would not be desecrated in representing five profound principles that today demand the determined and concerted efforts of Filipinos in both Church and State: Justice, Emancipation, Succor, Unity, and Sanctity. On Justice, the Corona impeachment is easily the most prominent event in which issues of truth, right and might are headlined daily. In it are moral issues upon which you our father bishops are well situated to comment, considering not only your religious expertise, but also your impartiality as a collegial body, notwithstanding the partisan leanings of some prelates. Several morality-related questions demand to be raised, partly to prod the national leadership toward just actions, but more so to sharpen the people’s sense of what is right and true amid partisan, selfserving machinations supposedly for lofty ideals.

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Among the questions: Will trial by publicity serve truth and justice, leading the public to pass judgment outside due process? Is rule of law advanced when lawmakers openly violate rules set down by the legislature itself? On this issue, one is reminded of the CBCP’s 2005 statement: “In this grave situation, various groups take advantage of one another, manipulate situations for their own agenda and create confusion among our people sometimes by projecting speculation or suspicion as proven fact, with the aim of grabbing power.” Most serious of all, especially in view of the overriding goal of fighting corruption, the avowed motive for the impeachment: Will good governance and democracy win if the Senate verdict comes not from due process and careful deliberation, but from less pristine considerations? Again, the prelates’ guidance in 2005: “[We] appeal to the people, especially their representatives and leaders, to discern their decisions not in terms of political loyalties but in the light of the Gospel values of truth, justice, and the common good.” The second moral concern of Emancipation from subjugation, poverty and violence — our nation’s gravest social sins — is most recently crystallized in the Hacienda Luisita case. Here, feudal and political issues fuse. Royal edicts early in the Spanish era placing huge tracts of land and their inhabitants in the hands of favored subjects, spawned oppressive and corrupt structures which continued to our time as patronage politics by landed or landlord-descended clans, laced with graft, guns and goons. In the centuries of landlord oppression and the struggle against it, rivers of blood and tears have

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A message for the Bishops: Let Jesus reign

flowed, including the killing of 13 peasants rallying near Malacañang for genuine land reform a quartercentury ago. They protested against then, President Corazon Aquino’s stock distribution option (SDO), which allowed landlords to avoid parceling out their vast estates, including the largest, her family’s Hacienda Luisita. Today, that long battle has finally produced the widely applauded unanimous Supreme Court decision invalidating Hacienda Luisita’s SDO and mandating the distribution of its 4,916 hectares to more than 6,000 farmer-beneficiaries. The ruling, which could emancipate 13 other estates, also ordered Hacienda Luisita Inc., controlled by Cory and Noynoy Aquino’s Cojuangco clan, to pay the farmers P1.33 billion, the latter’s share in past sales of HLI land. This victory, however, may be upended if the Supreme Court decrees that the farmers have to pay HLI the impossible sum of P1 million per hectare or P4.9 billion total, the 2006 valuation urged by PNoy’s first appointee on the bench, Justice Maria Lourdes Sereno. His two other appointees joined a third justice in wanting the Department of Agrarian Reform and the Land Bank, both under the President’s purview, to set the ‘just compensation’ for the estate. Most justices thankfully favored the 1989 valuation of P40,000 per hectare, since the SDO was in violation of land reform law from that year. How the Court eventually rules, however, may be influenced by the impeachment of Chief Justice Corona and, if he is convicted, the naming of his successor, for whom the President “needs someone of the likes of Maylou Sereno,” according to Presidential Spokesperson Edwin Lacierda. The primary moral imperative here is, of course, the emancipation and upliftment of Filipinos from oppression, violence and poverty. The Church must speak against the use of state power and partisan politics to frustrate the freeing of Hacienda

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Luisita’s farmers and their families from generations of bondage. Let not the peasant blood staining Mendiola’s bridge and Luisita’s gates be spilt in vain. Not to mention the Blood of our Lord shed for the freedom of all men from sin, individual and social. If the challenge in the moral concern of Justice is politicians, and the obstacle to Emancipation is feudal landlords, Succor requires facing the deadly vagaries of nature. With nearly half the population, including more than 35 million Filipino Catholics, exposed to calamity risk, according to the U.N. World Risk Index, the Church must provide at least as much support for disaster risk reduction (DRR) as it does for national elections. Or even do more, since catastrophes happen every year and cause far more death, destruction, and disruption of religious activities than triennial suffrage. The Parish Pastoral Council for Responsible Voting shows how effective and far-reaching the Church can be by mobilizing the clergy and the faithful. Why not then a Diocesan Council for Disaster Response and Reduction? DCDRR can organize calamity-prone communities for warning, evacuation, rescue, relief and recovery, in collaboration with state and civic organizations. Plus wealthy dioceses can have year-round drives for relief goods and funds. DCDRR could be piloted in selected catastropheprone areas before going nationwide. Besides disaster response, it could be a force for prevention, including initiatives to stop activities that elevate risk, such as deforestation and irresponsible mining. However the Church DRR program is implemented, it would save lives and livelihoods especially among the poor largely defenseless against the elements. Our Lord would surely bless such a noble undertaking to succor the least of His brethren in times of calamity.

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A message for the Bishops: Let Jesus reign

Unity, the fourth concern, can also save lives, especially the hundreds snuffed out in political violence over the years, including the decades-old communist and separatist insurgencies. In the past administration, there were efforts in selected areas to forge local ceasefires, mediated by bishops and local officials, even as the rebels still awaited nationwide peace agreements. The CBCP should revisit this mode of peacemaking, exploring where local ceasefires may be possible, then proposing such programs to the Defense and Peace Process secretaries. Communist leaders have long opposed local ceasefires, but if negotiations with them drag on while fighting escalates, then the Church must press for alternative strategies to stop the bloodshed. It cannot just stand by while Filipinos kill Filipinos. Your Excellencies must also use your stature and ties with local elites to forge peace accords among politicians with private armies. Later this year these leaders will begin jockeying for position in the 2013 elections, including building up arsenals and flexing warlord muscles. Before such potentially violent posturing starts, the Church hierarchy, clergy and laity must take steps to get political rivals discussing and agreeing on measures to minimize confrontation, intimidation and bloodshed. In sum, the Church must be an unrelenting force for peace always and everywhere, never standing silent when Filipinos kill Filipinos. No other entity, least of all the State in conflict with rebels and seen to favor administration politicians, can act as honest, impartial broker for national harmony and unity. And if the CBCP stands against contraception in defense of God-given life, then that same life-safeguarding principle must impel the Philippine hierarchy to work tirelessly for Succor and Unity. The last concern is one that the prelates need not be reminded of. Sanctity is what religion is about, first and foremost, so there is of course much of that in

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the CBCP plenary. May this believer add one more to the spirituality agenda: church building and repair. In particular, it is respectfully proposed that the Church consider a program to mobilize dioceses and parishes in erecting small chapels in far-flung areas. Having spawned the Gawad Kalinga movement to build homes for the poor, the Church can replicate GK’s huge national and even international success to construct houses of prayer where they are in grave disrepair or absent altogether. There is much corporate generosity and community volunteerism to tap, as Bahay ng Diyos Foundation, which this writer’s mother established, has found in assisting 43 churches since 2006. The proposed apostolate would heed the call of Pope Benedict 16th for Christians to return to our singular mission: proclaiming to humankind our faith in Jesus Christ as the redeeming Son of God Who is Himself the Way, the Truth and the Life bringing all people to the fullness of humanity not only by His life and sacrifice two millennia ago, but more so by His sanctifying action in our lives today, most especially in the Eucharist. A nationwide movement in the Philippine Church to join hands and resources in building and refurbishing houses of God, where the Gospel is preached and the transforming power of the Eucharist is shared — that initiative, perhaps more than many other equally laudable undertakings, would serve the papal advocacy to make more present in our communities, especially where there are no such structures now, our faith in Jesus Christ and His saving message and sacramental action. These five concerns are thus humbly presented for the CBCP’s deliberations: Justice, Emancipation, Succor, Unity, and Sanctity. We fervently pray that our loving Father, His redeeming Son, and the Holy Spirit of Divine Love shall bless Your Excellencies in discerning God’s will for our Church and our nation this year and beyond.

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Aboard the Cha-Cha Train Again A look at some of the most controversial charter-change proposals By Tanya L.Mariano

STRATEGY POINTS Controversial past proposals include changing the form and system of government and extending elected officials’ terms President Aquino asserts charter change is not a priority, but opposition suspects Malacañang of putting on a show to protect the President’s popularity

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In every administration since President Corazon Aquino’s, there have been moves to amend, in one way or another, the 1987 Constitution of the Republic of the Philippines. Even now, during President Benigno Simeon Aquino III’s administration, the trend continues, as another call for charter change is being made, this time by allies of the President, members of the Liberal Party. The House of Representatives and the Senate were scheduled to deliberate and vote separately regarding proposed amendments to the economic provisions of the Constitution that allegedly hinder the entry of foreign direct investments into the country, which some say is one of

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• January 30 - February 5, 2012


16 the reasons why the Philippines lags far behind most of its Asian neighbors. It has yet to gain the President’s support, who has stated that charter change is not one of his administration’s priorities.

1. Changing the form and system of government In 2005, the Constitutional Commission (ConCom) created by former President

The Constitutions of the Philippines, through the years In 1986, Cory Aquino created a Constitutional Commission, headed by Cecilia Munoz-Palma, the first female member of the Philippine Supreme Court, to draft a new constitution that would replace the Marcos regime’s 1973 Constitution. Among the Commission’s members were Bishop Teodoro Bacani, Ateneo School of Law dean emeritus Fr. Joaquin Bernas, economist Dr. Bernardo Villegas, and former Chief Justice Hilario Davide Jr. A provisional “Freedom” Constitution was drafted in the same year and was eventually superseded in 1987 by the current “Saligang Batas.” Prior to the 1973 Constitution, there was the 1943 Constitution, which was in effect during the Japanese Occupation, the 1935 “Commonwealth” Constitution, and the 1899 Malolos Constitution. (Links to the full text of Philippine Constitutions referred to here will direct you to the Chan Robles Virtual Law Library.)

Framed in 1987 by a Constitutional Commission created by then-President Corazon Aquino after the ouster of strongman Ferdinand Marcos, the current Constitution formally restored democracy and free elections to the country after years of dictatorial rule. However, there are concerns that the current constitution as it stands now is outdated and inadequate, and is actually discouraging economic and political development. Whereas proponents of the current initiative vow to focus only on amending economic provisions, past initiatives have targeted the more controversial political provisions as well. Here are some of the more contentious amendments and revisions that have been proposed over the years.

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Gloria Macapagal-Arroyo and chaired by former University of the Philippines (UP) President Jose Abueva proposed the shift from a presidential-unitary system of government to a federalparliamentary system. According to Abueva in “Some Advantages of Federalism and Parliamentary Government for the Philippines,” the prevailing system is counter-productive as it vests too much power, resources, and authority in the national government at the expense of local governments and the rest of the country, promotes conflict between the President and Congress because of the “adversarial separation of powers,” perpetuates patronage politics and corruption, and fails to promote genuine development throughout the country.

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Aboard the Cha-Cha train again

The Supreme Court in October 2006, however, rejected the petitions of Sigaw ng Bayan and the Union of Local Authorities of the Philippines (ULAP) to amend the Constitution, based on the ConCom’s recommendations, through a people’s initiative.

Whereas adopting a parliamentary form of government was expected to make both politicians and voters take political platforms more seriously because of the increase in importance of party affiliations, federalism was supposed to bolster government accountability and Framed in 1987, citizens’ participation in governance, the current according to a study Constitution by Ateneo associate formally restored professor of philosophy Agustin Martin Philippine Rodriguez, which was democracy after commissioned in 2007 years of dictatorial by the Coalition for a Citizens’ Constitution rule, but some (C4CC).

Had they succeeded in creating a federal Philippine Republic, the country would have been subdivided into 11 states: 1) The Bangsamoro (ARMM), 2) Davao Region and Central Mindanao, 3) Western and Northern Mindanao, 4) Central and Eastern Visayas, 5) Western worry that it has Visayas and Palawan, In 2008, Senator become outdated 6) Bicol, 7) Southern Aquilino Pimentel Jr., Luzon, 8) Metro Manila, also proposed the move 9) Central Luzon, 10) to a federal system Cordillera, and 11) Northern Luzon. that retains the Presidential form of government and the creation of 11 federal The Congress and the Coalition for states through Joint Resolution No. 10, Charter Change Now, a non-governmental which gained the support of then-House organization whose members are closely Speaker Prospero Nograles, a selfallied with former House Speaker Jose proclaimed federalism advocate. de Venecia, also called for a shift to a parliamentary form of government in 2005. According to a presentation by Pimentel, The Philippine Center for Investigative Federalizing the Philippines: The Final Journalism puts the various proposals Solution (within Reason), during a Senate side by side in this matrix. Another matrix committee hearing on federalism in August prepared details the ConCom’s proposed 2008, shifting to a federal system would changes to the 1987 Constitution. not only promote economic development throughout the archipelago but also The 2006 bulletin, “Forming a government: dissipate the conflict in Mindanao by parliamentary vs. presidential system,” granting the Bangsamoro the freedom prepared by the Philippine Institute of self-rule. for Development Studies, details the differences between the two forms In a 2005 paper that looks at the of government. experiences of other countries transitioning

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Who wants to cha-cha? Not very many, polls show Historically, proposed changes to the constitution have always been met with widespread public opposition and protests. GMA News provides a neat summary of the major anti-Charter Change rallies from 1997-2008. It’s safe to say that charter change has never received a huge groundswell of support from the general public. The table below tracks the changes in level of public support for charter change based on the results of Pulse Asia’s opinion polls, conducted between April 2006 and February 2009 with a sample of 1,200 Filipino adults 18 years old and above. As can be seen from the figures, in April and July 2006, the number of people in favor of changing the Constitution at the time of the survey exceeded the number of those who opposed it, albeit only by a slim margin, but the November 2006 and February 2009 results showed an increase in opposition.

TEPID PUBLIC SUPPORT FOR CHARTER CHANGE Whether or not in favor of changing the Constitution April 2006 to February 2009 / Philippines (in percent)

Are you in favor or not in favor of changing our Constitution now? (Base: Total interviews, 100%)

IN FAVOR

Feb 2009 Nov 2006 Jul 2006 Apr 2006 UNDECIDED Feb 2009 Nov 2006 Jul 2006 Apr 2006 NOT IN Feb 2009 FAVOR Nov 2006 Jul 2006 Apr 2006

LOCATION

CLASS

RP

NCR

LUZ

VIS

MIN

ABC

D

E

33 39 40 44 25 19 21 15 42 42 38 40

25 38 33 35 31 16 22 15 44 46 45 50

34 34 43 52 22 22 20 17 44 44 37 31

38 47 39 38 6 17 19 15 56 35 42 47

33 39 41 41 19 15 27 13 26 42 32 46

31 40 34 34 27 17 28 22 42 41 38 44

32 35 38 45 25 20 20 14 44 45 41 41

37 45 47 45 24 18 22 16 40 37 31 39

Question: Kayo po ba ay pabor o hindi pabor na baguhin ang ating Konstitusyon ngayon?

Table from Pulse Asia

Surveys by the Social Weather Stations also found high opposition to charter change, especially during former President Arroyo’s term. In a media release announcing the findings of their 2008 poll, which found that 64% of Filipinos opposed amending the Constitution if it will allow former President Arroyo to remain as chief official of the Philippines beyond 2010, the SWS also provides a review of opinion polls from 2002-2006, which found that “most Filipinos have always been opposed to any Constitutional changes that extend the President's stay in office.”

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to federalism and explores whether federalism decreases social cleavages, Dr. Clarita R. Carlos, UP professor of Political Science and president of the Center for Political and Democratic Reform (CPDRI), argues that “federalism is one of the more realistic ways to maintain national unity in the face of extant regional centers based on power and ethnic divides,” and that while it cannot eradicate conflict, “It will, however, provide a better environment by giving people more control over their future and by entrusting to them important decisions about their way of life according to their needs.” However, in Rodriguez’ aforementioned study, he warns that shifting to federalism may undo gains made by the 1987 Constitution in terms of furthering social justice, and concludes that the Philippines is not yet ready and will not be ready anytime soon for such a radical change. If the Philippines ever does find itself shifting from one system of government to another, a paper by Dr. Cristina Montiel, psychology professor at the Ateneo de Manila University and an

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Aboard the Cha-Cha train again

Asian Public Intellectual fellow, discusses a number of lessons that the country can learn from Malaysia’s transition to federalism.

signatures it had managed to obtain. Article VII, Section 4 of the 1987 Constitution states that the president shall serve for six years and is prohibited from seeking re-election.

2. Extending the term of office of elected officials

In 2009, there was also talk that thenPresident Gloria Macapagal-Arroyo had In quite possibly the most obvious attempt an ulterior motive in pushing for charter to keep an incumbent president in office change: to extend her term beyond 2010. A beyond his term, former Ambassador to June 2009 report by ABS-CBN News lists Belgium and the European Union Alberto the term-extension scenarios that were Pedrosa, and his wife, columnist Carmen floated around after the approval of House Pedrosa, Resolution both known 1109, which supporters called upon of former members of President Fidel the congress to V. Ramos, convene into founded a constituent the People’s assembly to Initiative study proposals for Reform, to amend or Modernization, revise the and Action No desire for extended term, asserts then-President Gloria constitution. Macapagal Arroyo in her 2009 SONA. Video (Part 7 of 7) (PIRMA) to Arroyo, of courtesy of RTVMalacanang campaign for course, denied the lifting of term limits of elected officials. this and, in her 2009 State of the Nation Their campaign included paid newspaper Address (SONA), reiterated, “I have never ads, such as this one that appeared in expressed a desire to extend myself the Manila Standard on Dec. 5, 1996, beyond my term.” trumpeting former President Ramos’ achievements, and a signature campaign in The initiative lost traction after the 1997, a year before the former president was death of Corazon Aquino on August 1, 2009. scheduled to step down. Eight party-list representatives, including Bayan Muna’s Satur Ocampo, filed The initiative prompted a group HR 1333 to formally call on their spearheaded by Jaime Cardinal Sin and colleagues to withdraw their support former President Cory Aquino to stage an for HR 1109 as a sign of respect for the anti-charter-change rally on September 21, former president. 1997 to coincide with the anniversary of EDSA I, and two days later, the Supreme 3. Amendments to economic Court killed PIRMA by dismissing provisions governing foreign its petition to validate the six million participation

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20 There have been several moves to change economic provisions that critics say act as barriers to the kind of economic development that an increase in foreign investors could bring, but the two most extensive proposals so far were made by the ConCom in 2006 and earlier by the Philippine Commission on Constitutional Reforms (PCCR), through former President Joseph “Erap” Estrada’s Constitutional Corrections for Development (CONCORD).

ownership by foreigners, and the abolition of restrictions on foreign equity in mass media, public utilities, exploitation of natural resources, and advertising.

In a 2009 paper prepared by the Congressional Planning and Budget Department of the House of Representatives entitled, “Foreign Land Ownership: A Survey of Regulatory Approaches in Selected Countries,” the main argument IT‘S THE CORRUPTION, STUPID! for relaxing the The most problematic factors for doing business restrictions on Corruption ...22.7 foreign participation Inefficient government bureaucracy ...18.3 in the economy is Inadequate supply of infrastructure ...15.4 “weak domestic Policy instability ...11.8 Tax rates .....9.2 capital formulation.” Restrictive labor regulations .....5.1 According to Inadequate educated workforce .....4.0 Government instability/coups .....2.3 the report, “the Access to financing .....2.3 government has Poor work ethic in national labor force .....2.1 to rely on foreign Crime and theft .....1.7 Foreign currency regulations .....1.7 savings, particularly Inflation .....1.3 on borrowing, to Poor public health .....1.2 0 5 10 15 20 25 30 finance its investment Percent of responses need,” a practice that Note: From a list of 15 factors, respondents were asked to select the five most problematic for doing business in their country and to rank them between 1 (most problematic) and 5. The bars in the figure show the responses weighted according to their rankings. will not sustain and Chart from page 274 of the Global Competitiveness Report 2010-2011, World Bank support present and While the ConCom touched upon the future economic growth. The paper appears political provisions as well, Estrada’s to have been released in support of the illCONCORD focused on changing the fated House Resolution 737, authored by protectionist economic provisions then-Speaker Nograles. found on Article XII of the Constitution (“National Economy and Patrimony”) However, in a 2007 paper commissioned by which, according to him, would make the the C4CC, Joel Rocamora, political analyst Philippines a “flea market” rather than and current Lead Convenor of the National a “free market,” unable to compete in Anti-Poverty Commission, says that there the global economy. In his 2000 SONA, is no evidence that liberalizing the economy however, Estrada announced that he was will encourage foreign investments in the shelving the CONCORD after it failed to country, a sentiment that is supported by garner widespread support. findings of the World Economic Forum’s “Global Competitiveness Report 2010Proposed amendments to Article XII 2011.” According to the report, the most cover the lifting of prohibition of land cited factors that make doing business

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Aboard the Cha-Cha train again

in the Philippines problematic have nothing to do with the restrictive nature of the Constitution: corruption, inefficient government bureaucracy, and inadequate supply of infrastructure. Also, quoting from a 2006 study by Eric Quevedo, Rocamora argues that even with these restrictions in place, the government has always found “legal dodges” to bypass them, citing cases in the areas of power generation, Metro Rail Transit operations, media and mining industries, and land ownership. For more detailed information on foreign direct investment regulations around the world, check “Investing Across Borders, 2010” by the World Bank Group, which covers 87 economies, including the Philippines, and looks at the following indicators of regulations governing foreign direct investment: investing across borders, starting a foreign business, accessing industrial land, and arbitrating commercial disputes. The report notes that the Philippines “imposes foreign equity ownership restrictions on more sectors than most other countries,” a sentiment that might be seconded by the European Chamber of Commerce in the Philippines. Apprehensions over the current initiatives to amend the Charter. Opinions on whether the Philippines should amend/revise the Constitution, or whether this is the right time to do it, are generally split. Bayan Muna Rep. Teddy Casiño warns that liberalizing the Charter’s economic provisions will result in land grabbing

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and further exploitation of the country, saying, “If we remove nominal protectionist provisions against foreign landownership, we open the floodgates for massive FLAs [foreign land acquisitions] now being done in other similar Southern countries.” Casiño cites the World Bank’s 2011 “Rising Global Interest in Farmland: Can it Yield Sustainable and Equitable Benefits?” report, which looks at the experiences of land expansion and agricultural investments in Latin America and the Caribbean, Asia, Sub-Saharan Africa, and Eastern Europe, which shows that foreign land acquisitions, especially in the least developed countries, may have adverse social and environmental consequences if not handled properly. On the other hand, in an article that appeared in the Philippine Daily Inquirer in August, Dr. Bernardo M. Villegas writes that he believes that the economic provisions of the Charter need to be amended in order to attract enough foreign direct investment to sustain a high GDP growth. As to which provisions need to be changed, he suggests referring to “Arangkada Philippines 2010: A Business Perspective,” a report by the Joint Foreign Chambers of Commerce in the Philippines (JFC). Pages 279 to 282 of the report cover the restrictions enshrined in the 1987 Constitution, specifically the ones on land ownership and public utilities, which the report says are “the most formal barriers to foreign participation in the Philippine economy.”

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Aboard the Cha-Cha train again

Nonetheless, Dr. Villegas does recommend deferring to 2013 any moves to amend or revise the Constitution, to give the government enough time to consolidate necessary economic reforms, which include “doables” that do not require constitutional amendment, e.g., combating corruption, reducing the cost of electricity, and eliminating bureaucratic red tape, among others. So why is charter change being resurrected now? Senator Franklin Drilon is convinced that now is the best time to propose amendments to the Constitution, as we

Changing the Charter: easy as 1-2-3? Article XVII of the 1987 Constitution outlines the three modes by which amendments or revisions may be proposed: 1) by a constitutional assembly formed through a three-fourths vote of all members of Congress, 2) through the formation of a constitutional convention by a two-thirds vote of all members of Congress, and 3) through a people’s initiative, which requires a petition by at least 12% of the total number of registered voters in the country, with every legislative district represented by at least 3% of its registered voters. In all three modes, a plebiscite or national referendum shall be held between 60 to 90 days after the approval of the proposed amendment or revision, in the case of the first two modes, or after Comelec certifies that the petition is sufficient, in the case of a people’s initiative. The amendments or revision will only be valid after receiving a majority vote from the Filipino electorate during the plebiscite.

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have a President who is not interested in clinging to power, and was in fact at first reluctant to run for office. But is his lack of interest in power the actual reason behind his distancing himself from this renewed call for cha-cha? ABS-CBN News reports that the minority bloc in the House of Representatives believes that the President is actually secretly behind the current moves to change the Constitution. In a statement read by Zambales Rep. Mitos Magsaysay, the minority bloc said that Malacañang is putting on a “great show, a moromoro,” in order to further its own charter-change agenda while protecting the President’s popularity. Aside from speculation on the proponents’ intent, the manner in which charter change is being proposed is also being called into questioned. House Minority Leader Edcel Lagman says that amendments through Drilon’s proposed variation of a bicameral constituent assembly are clearly unconstitutional, as it is not among one of the three modes permitted by the Constitution, as reported in the Philippine Daily Inquirer. As of now, the fate of the current charter change initiative hangs in the balance. We will have to wait and see whether the current administration hops on the “chacha train” and tries to take it somewhere, or, as with past initiatives, the train loses steam and fails to make it out of the yard.

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NEWS ON THE NET Nation

‘Gov’t focused on regaining Category 1 under FAA’

prosecutor in NBI's Region I office, will act as the agency’s head until President Aquino formally appoints a replacement for Gatdula.

A team of inspectors from the U.S. Federal Aviation Administration (FAA) conducted a technical review of the Civil Aviation Authority of the Philippines (CAAP) and the country’s compliance with international aviation standards. A positive review could result in the expansion of local airlines’ capacities and a healthier Philippine aviation industry.

Gatdula earlier maintained that he was being replaced without due process. Among names reportedly being considered for his replacement is retired general and Customs Deputy Commissioner Danilo Lim.

In 2008, the FAA downgraded the Philippines to Category 2 in its International Aviation Safety Assessment, citing the country’s deficiencies in regulation, oversight and management. The downgrade prompted the government to create the Civil Aviation Authority which was mandated to introduce reforms in the aviation sector.

Ilocos prosecutor named NBI OIC After lawyer Magtanggol Gatdula was sacked as National Bureau of Investigation (NBI) director due to his alleged involvement in the kidnapping of an undocumented Japanese woman last year, Justice Secretary Leila de Lima named Nonnatus Caesar Rojas as officer-in-charge. Rojas, who is a

The

Ruling on SMC shares affirmed The Supreme Court, voting 110, upheld the decision of the Sandiganbayan ordering the reconveyance to the government of the 24 percent block of shares or 753.8 million shares in San Miguel Corp (SMC). The shares, valued at P100 billion, were acquired through the coconut levy collected from 1973 to 1982 and registered in the names of the Coconut Industry Investment Fund and its holding companies. In 1986, the SMC shares were sequestered by the Presidential Commission on Good Government on allegations that the shares were illegally acquired

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by cronies of the late President Ferdinand E. Marcos. Last year, the Supreme Court ordered the conversion of the said 24 percent SMC shares from common shares to preferred shares in order to preserve their value.

‘Trial not limited to acquittal, conviction’ Senator Miriam Defensor Santiago said that Chief Justice Renato Corona may not necessarily be removed from office even if the Senate impeachment court renders a decision of conviction. She pointed out that, since the Constitution allows the impeachment court to mete out judgments less than removal from office and disqualification to hold any public office, but not more, reprimand or censure can be resorted to. On the second week of the trial, the prosecution insisted on presenting Corona’s income tax returns and scrutinizing his Statements of Assets, Liabilities and Net Worth. The defense panel, as well as the Integrated Bar of the Philippines, opined that Corona’s rights to due process were being violated by the presentation of irrelevant evidence.

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Loading Kim 3.0 in Pyongyang Can the new ‘Great Leader’ of North Korea take charge and bring urgent reform? By Ricardo Saludo

STRATEGY POINTS

The rush to install Kim Jong Un and give him lofty positions and titles may suggest top-level worries over possible challenges to his rule After the present calm will come years of firmly establishing the new dictator through popular measures at home and tough posturing abroad Get ready for more of the same tense and testy nukes-forfood tussles with Pyongyang

CONTENTS

Kim Jong Un (center, saluting) walks beside his father Kim Jong Il’s hearse

First the good news: Despite initial worries about volatile North Korea after the passing of its leader Kim Jong II a week before Christmas, the transition to his successor, third son Kim Jong Un, has so far been stable. Now in in late 20s, the erstwhile Great Successor has assumed the title of Great Leader reserved for the Stalinist state’s dictator, as well as the all-powerful post of Supreme Commander of the army. The elder Kim’s death, writes John Swenson-Wright of London-based think tank Chatham House, “was in the words of the international media, a ‘game-changer’, highlighting the difficulties of interpreting political events in North Korea. In the short-term, stability rather than chaos is the likely outcome for the peninsula.” Swenson-Wright’s paper, “North Korea’s Leadership Transition: Stabiity rather than Chaos,” added: “The absence of any siblings at the state funeral, other than the heir-apparent, is a clear indication that publicly at least there are no rivals within the Kim family dynasty.” Kim Jong Un has two older brothers, both living abroad and long estranged from their father.

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Loading Kim 3.9 in Pyongyang

Of course, the not-so-good news is: how long will the calm last? Will Kim Jong Un consolidate power and truly rule the country? And what issues, threats and even opportunities does the change in leadership hold for the region? Speaking to BBC News soon after Kim Jong Il’s death on December 19, former U.S. Assistant Secretary of State for East Asian and Pacific Affairs Christopher Hill agreed that “things are going to be on hold” for some time, “a period when they’re going to figure out who’s in charge of that country.” Washington’s longtime negotiator with Pyongyang expected the North Korean military will likely move to secure power and allow “fewer initiatives” including those involving foreign powers. But Hill believes new leader Kim Jong Un “still has a few more years to go before he can be considered a real player.” In his paper “The Boy Who Would Be King: Can Kim III Last?”, Sung-Yoon Lee,

U.S diplomat Hill and Kim Jong Il in BBC feature: ‘Who’s in charge?’

Asia research fellow at Tufts University’s Fletcher School, argues: “What likely comes next in the surreal kingdom of the Kims ... will be a series of aggressive measures, both internal and external, in an attempt to consolidate Kim Jong Un’s flimsy credentials.” In a Jan. 16 interview, the first with foreign media given by a top Pyongyang official since Kim Jong Il’s death, the vicepresident of the Presidium of the Supreme People’s Assembly, Yang Hyong Sop, 86, dismissed concerns about Kim Jong Un’s leadership. “We suffered the greatest loss in the history of our nation as a result of the sudden, The Official Kim Jong Un Born January 8, 1983 or 1984, North Korea’s ‘Great Leader’ Kim Jong Un went to Bern International School and Kim Il Sung University. After Supreme Commander, his next top posts may be Defense Commission and ruling party head. State footage shows him paying respects, weeping and greeting foreigners at his father‘s memorial; visiting an army school, military barracks, and new homes with his father; and in a recent birthday feature. Western media scoff at the propaganda. But some analysts say Kim 3.0 is here to stay.

Kim Jong Un with trusted family confidante Yang Hyong Sop (right) at new state theater: ‘We are not worried a bit’

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GUNS ACROSS THE PARALLEL Balance of of Military Military Forces Forces in in Korea, Korea, 2010 2010 Balance NORTH KOREA

SOUTH KOREA

Population

22,600,000

48,500,000

Armed Forces

1,106,000

687,000

Army

950,000

560,000

Navy

46,000

68,000

Air Force

110,000

64,000

Paramilitary

189,000

4,500

4,700,000

4,500,000

Tanks/Armored Vehicles

6,500+

5,570

Artillery/Missiles

17,900+

10,774+

Reserves

Combat vessels

3 frigates, 5 corvettes,

10 destroyers, 9 frigates

330+ coastal boats

28 corvettes, 76 coastal

63 submarines

13 submarines

Combat planes

620, incl. 388 fighters

498, incl. 467 fighters

Helicopters

20 attack, 202 support

184+ attack, 600+ support

Source: The Military Balance on the Korean Peninsula (highlights, 2010), International Institute for Strategic Studies

unexpected and tragic loss of the great leader Kim Jong Il,” he told media at Mansudae Assembly Hall, seat of the North Korean legislature. “But still, we are not worried a bit, because we know that we are being led by comrade Kim Jong Un, who is fully prepared to carry on the heritage created by the great General Kim Jong II.” For decades Yang has been a pillar of stability behind the ruling dynasty. He is a revered stalwart in the Workers Party of Korea’s governing Politburo and a trusted confidante of the Kim family, as wartime comrade to North Korea’s late founding father Kim II Sung and husband to the latter’s cousin. As early as October

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2010, Yang had signaled Kim Jong Un’s succession. “He knows what the intention of the great General Kim Jong Il was,” Yang said then in an Associated Press TV interview. Ironically, the unusual haste with which Kim Jong Un was given major titles, which his own father waited three years to assume, suggests challenges to the new leader. “The efforts to put Kim Jong Un front and center immediately reflects a rushed succession process,” Georgetown University professor Victor Cha told the Christian Science Monitor. “A Potemkin [false] leadership transition will likely run into problems.”

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Loading Kim 3.9 in Pyongyang

In an interview with the Center for Strategic and International Studies, Cha, former Asia director for the National Security Council under President George W. Bush, says preparing Kim Jong Un for succession was supposed to have taken ten years. “It is the nightmare scenario for the North Korean leadership to see Kim Jong Il die when they’re not ready for a transition,” he told the Washington think tank. “This is not going to be a smooth leadership transition.” For South Korea, Japan, China, the U.S., and much of East Asia, North Korea’s nuclear weapons program remains the biggest issue with Pyongyang. In his recent paper “Re-Engaging North Korea After Kim Jong-il’s Death: Last, Best Hope or Dialogue to Nowhere?”, foreign policy fellow Evans J.R. Revere of Washington’s Brookings Institution said the change in leadership has transferred to Kim Jong Un the tough issue facing his father of whether to denuclearize the North. “It will be a difficult, perhaps even impossible, step for a young, inexperienced, untried leader likely to be even more dependent on the military and on the nuclear and missile totems than was his father,” says Revere. “Making the wrong decision could hasten the demise of his regime.” Certainly, those boosting the new leader’s stock evidently see the need to present him as favoring, even ordering, nukes development. What about the crisis economy and food scarcity which could trigger a war to divert unrest? The Institute of Far Eastern

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Studies of Seoul’s Kyungnam University reported last week that nationwide food distribution may resume in the North for the first time in seven years. IFES quotes a South Korean official: “Kim Jong Un and his leadership will begin food distribution to prove to its people the changes forthcoming in the new regime. After years of espousing the building of a strong and prosperous nation, they must demonstrate it ... with noticeable results.” Notably, the U.N. Food and Agriculture Organization reported that North Korean food production rose 8.5% last year, to 4.66 million tons of milled grain. Despite the increase, however, the harvest is still 400,000 tons short of national requirements — “the largest deficiency in food supply” in recent years, says IFES. Clearly, Kim Jong Un will need more than a week or a month of grub to save his rule and the economy from collapse. However, there are economic improvements in recent years, ironically due to reasons outside or even contrary to Pyongyang’s agenda. Professor Andrei Lankov of Kookmin University in Seoul cites three factors. First, the underground economy, which has developed since the mid-1990s, now provides 35%-80% of food. Second, state enterprises have recovered from the Soviet

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Pyongyang military parade in 2010 (left); South Korean F-16s: The North’s army can be stopped, but can Seoul be saved?

aid drought in 1990-95. Third, Chinese funds have made up for the drop in U.S. and South Korean assistance due to North Korea’s nuclear program.

CSIS’s Snyder and See-won Byun of George Washington University noted that China quickly expressed support for Kim Jong Un, and Chinese Foreign Minister Yang Jiechi lobbied with his counterparts in Moscow, Seoul, Tokyo, and Washington “in support of its top priority of maintaining stability on the peninsula.”

Hence, Lankov argues in an Asia Times article that North Korea Still, there is that eldest is far from brother Kim hanging revolution. around in China, whose State media protection he claims. has kept the In his book, written Eldest brother Kim Jong Nam: ‘Sleazy, lying officials’ citizenry with Tokyo Shimbun largely reporter Yoji Gomi, unaware of better alternatives to their Kim Jong Nam fumes: “There are sleazy destitution. The elite remains unified officials who kiss up to my father for their behind stability, knowing “that a revolution own survival, lying about the affairs of the would likely to be followed by unification country in pursuit of their own good and with the prosperous South ... the complete creating a barrier between the leadership loss of power and privileges or perhaps even and the people … I want these people to death at the hands of lynch mobs.” disappear away from my father and the successor.” A further stabilizing factor is China. In their paper “China-Korea Relations: New In Pyongyang, clearly, it’s not over till the Challenges in the Post-Kim Jong Il Era,” fat man sings.

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To merge or not to merge — that is the $300-billion question If you had a sibling who wants to make peace after decades of bitter conflict and bring his family to live with you, would you agree, knowing it would cost one-fifth of your paycheck for 25 years? The table below compares economic projections for Korean reunification over 25 years. Bottom line: With capital going north, jobseekers heading south, and overall economic or “total factor” productivity (TFP) slipping, South Korea’s bill would be 20% of its economic output or gross domestic product from 2015 to 2040. But the whole peninsula’s GDP would be $300 billion more than it would be sans reunification. And there would be less reason for the North to attack the South. That’s the estimate in “Economic Impacts of Reunifications in Germany and in Korea,” based on the cost of German union and adjusted for North Korea’s higher population ratio and much lower income level vis-a-vis the South. The report was first published last April and revised just last month by economists Seung Mo Choi and Max St. Brown of Washington State University, and Hyung Seok Kim of Sogang University in Seoul.

THE COST OF ONE KOREA

Impacts of Korean Economic Integration in 2040

GDP

Nointegration in 2015

Baseline Case (German-style) Integration in 2015

Integrartion with slower convergence

Integration with greater migration and capital transfers

GDP of SK and NK combined

$4,303 billion

$4,505 billion

$4,324 billion

$4,613 billion

GDP per capita

SK: $75,924 NK: $1,134

SK: $60,848 NK: $36,349

SK: $60,848 NK: $28,797

SK: $57,762 NK: $44,988

SK: 56.3 million NK: 27.5 million

SK: 59.6 million NK: 24.1 million

SK: 59.6 million NK: 24.1 million

SK: 67.4 million NK: 16.0 milllion

SK: $50,616 NK: $756

SK: $40,565 NK: $24,232

SK: $40,565 NK:$19,198

SK: $38,508 NK: $29,992

SK: $18.4 trillion NK: $46 billion

SK: $15.1 trillion NK: $3.5 trillion

SK: $15.1 trillion NK: $2.9 trillion

SK: $14.6 trillion NK: $4.5 trillion

SK: 7.7% NK:22.7%

SK: 8.0% NK: 8.2%

SK: 8.0% NK 7.9%

SK: 8.9% NK: 5.4%

Population Labor Wage Rate (Marginal Product of LAbor Physical Capital Physical Capital

Interest Rate (Marginal Product of Physical Capital, before Depreciation

Source: “Economic Impacts of Reunifications in Germany and in Korea,” S.M. Choi, H.S. Kim and M. St. Brown (2011)

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Loading Kim 3.9 in Pyongyang

What do the new boss on Pyongyang and his backers in Beijing think of one Korea? Kim Jong Il’s eldest son Kim Jong Nam thinks the North Korean old guard surrounding and propping up his younger brother Kim Jong Un would oppose reunification to preserve their power and prevent retribution for the dictatorship’s harsh rule. China too, argues Kookmin University professor Andrei Lankov, prefers Korea split. “China needs: first, a stable Korean peninsula; second, a divided Korean peninsula; third a non-nuclear Korean peninsula.” And with Sino-American rivalry on the rise in Asia, Beijing has more reason to want a buffer state between itself and U.S.-allied South Korea.

‘China needs a stable, divided and nonnuclear Korean peninsula,’ with a buffer state between itself and U.S. ally South Korea

But whatever Beijing, Pyongyang, Seoul or Washington may want, reunification could be forced by economic collapse or political chaos up North. Hence, enter the planners. Last month the Korea Project study group convened by Washington think tank Center for Strategic and International Studies and the University of Southern California, put out its interim report, “Challenges for Korean Reunification Planning.” Overseen by David Kang, director of USC’s Korean Studies Institute, and CSIS Korea fellow Victor Cha, the extensive analysis harnessed two dozen leading experts to look into scenarios, key institutions, governance, economy, society, and lessons from other crises.

After the immediate imperative to establish law and order and provide basic needs to the the North Korean populace, the study cited the need to balance two pairs of conflicting priorities: short-term political expediency vs. long-term restructuring, and stability vs. legitimacy. For the economy, the report advised careful restructuring which avoids mass unemployment, promotes informal markets for a time, and establishes property rights. Seattle’s World Affairs Council listed papers on German reunification lessons for Korea. But like the fall of the Berlin Wall, the opening of the Demilitarized Zone would almost surely be a sudden union, for which Holger Wolf of the Peterson Institute for International Economics outlined his seminal 1998 book chapter, “Korean Reunification: Lesson from Germany.” In Lankov’s Foreign Affairs article “North Korea’s Choice: Collapse or Reform, the Kookmin professor maintains that Kim Jong Un would keep the North a nuclear-tipped rogue nation extorting aid and respect from major powers. “But that doesn’t mean the current system will continue indefinitely,” he warns. “No country with a hyper-centralized, Stalinist economy has remained efficient for longer than two or three decades.” In short, get ready for a very messy reunion.

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NEWS ON THE NET World

Egyptians pack Tahrir Square for revelry, protests a year after revolt A year after the 2011 Egyptian revolution, thousands of Egyptians congregated in Cairo’s Tahrir Square to commemorate the ousting of decades-long ruler Hosni Mubarak. The first anniversary of the event that rocked the Middle Eastern country brought mixed reactions. While many say that it accomplished little else past Mubarak’s ouster, some believe that the revolution has helped Egypt’s progress. The Egyptian uprising last year followed in the footsteps of the Tunisian revolt, which freed Tunisia from a dictatorship and started the “Arab Spring.” An interactive timeline of the Middle East protests is provided by The Guardian.

Somalia: Western hostages freed in US military raid A US military raid in Somalia resulted in the rescue of two foreign aid workers who were kidnapped three months ago. The mission was approved due to concerns rising from the failing health of one of the captives. Reports confirm that American

The

Jessica Buchanan and Dane Poul Thisted were freed uninjured and that none of the U.S. forces deployed were killed in the operation, said to be carried out by the same Seal Team Six which killed Osama Bin Laden last year. Seal Team Six was also involved in a helicopter crash in Afghanistan last October. Several of their number were killed in the Talibanclaimed attack, which resulted in the largest loss of life (38 casualties) suffered by foreign forces in one single incident in the 10-year Afghan War.

Japan’s first trade deficit since 1980 raises debt doubts Japan recorded its first trade deficit in over 30 years, underscoring a declining trend in the country’s competitive edge in the global market, Reuters reports. The deficit, however, came sooner than expected, and is attributed to the natural disasters—particularly the magnitude 9.0 earthquake last March 2011— that devastated Japan and devalued the yen. Japan also had been relying on

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fuel imports due to public safety concerns against reviving its nuclear power reactors. On a related note, the University of Tokyo‘s Earthquake Research Institute predicts that another “massive earthquake” is likely to hit Japan in the relatively near future-- a 70% probability of a magnitude-7 quake happening within four years, and a 98 percent probability within 30.

Syria agrees to extend Arab League mission Syria has allowed the Arab League to extend its observer mission for another month, or until Feb. 23, according to its staterun news agency. Started last December, the mission is meant to monitor Damascus’ compliance with the League’s thrust to end bloodshed in the Syrian nation. The U.N. reports that over 5,000 people have died in the government’s attempts to silence protests since the Syrian uprising started last year. In the midst of increasing violence in the country, U.N. envoys from Britain, France and the U.S. criticized Russia for supplying weapons to Syria and fueling the crisis. The U.S. urged countries to declare a moratorium on arms sales to Damascus.

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BUSINESS

Log In and Be Counted The Philippines as a digital market for advertisers By Joanne Angela B. Marzan

STRATEGY POINTS The Philippines’ Internet population is estimated to be just under 30 million users, 6thlargest in Asia, but growing at a rate of 16% a year The rate of Internet penetration in the Philippines is still low, 19% of the adult population, and only 6% of households, but there is a big upside as Filipinos find different ways to get online, including Internet cafes and mobile phones The time to explore advertising possibilities is now, while the local digital market already sizeable, but still young, growing, and looking for things to do online

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Charice Pempengco probably didn‘t think she would catch the attention of popular American talk-show hosts Ellen DeGeneres and Oprah Winfrey with her cover of a Whitney Houston song in a video posted on YouTube in 2007. Such is the power of YouTube. Ever since its inception in 2005 by three former PayPal employees, YouTube has become a platform for aspiring singers, artists or simply attention-hungry individuals all over the world to get their proverbial 15 minutes of fame. A year later, Google bought YouTube for a staggering $1.65 billion. YouTube Philippines is launched. On October 13, 2011, YouTube Philippines was launched, making the Philippines the first local partner of YouTube in Southeast Asia. During the launch, Google’s Managing Editor in Southeast Asia, Julian Persaud, discussed some of the reasons why the Philippines was chosen.

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“The Philippines focuses on Asian has embraced technology startup the Internet news. in a truly remarkable The Philippines’ way. At least 30 online population. million Filipinos Data as of March regularly access 2011 coming from the Internet to Internet World Stats Persaud explains why the Philippines was chosen study, to shop, put the number of local as YouTube‘s first local partner in Southeast Asia to search for Internet users at 29.7 ideas and opportunities, to create new million, making the Philippines 6th in Asia businesses, and to connect with each other. by that estimation. Among Internet users, almost everyone has viewed videos on YouTube,” Persaud said According to the paper Internet Use in the in a speech. Philippines by Iremae D. Labucay of Social Weather Stations, “about one in every five “Since August of last year, Filipinos (19%) of Filipino adults go online to access regularly account for one of the highest the Internet or the World Wide Web or view counts in the Asia Pacific region,” send and receive email, as of the March added Adam Smith, YouTube Asia Pacific 2011 Social Weather Survey (SWS).” Region Director of Product Management, in an article on the YouTube Philippines Though still low, the percentage of adults launch in Singapore-based E27, which who access the Internet has been on a TOP 10 ONLINE POPULATIONS IN ASIA

Asia Top Internet Countries March 31, 2011

Source: Internet World Stats

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steady rise since 2008, per the table below, and according to her findings, the majority of adult non-users are proxy Internet users who can have family members access the Internet on their behalf.

PERCENTAGE OF FILIPINO ADULTS WHO USE THE INTERNET, 2006-2011

Monetizing YouTube views. Having a local counterpart of YouTube allows Philippine-based content providers to monetize locally produced original videos through advertising placements. This feature was previously not available in the country, even if an original video from the Philippines become famous worldwide. “Content providers have always been able to monetize views but with the localized service launched we could start monetizing views originating from the Philippines,” said Gautam Anand, Google’s Director of Content Partnerships for Asia Pacific, in the aforementioned E27 article.

Question wording: 2006 to 2010: “Do you use a computer at your workplace, at school, at home, or anywhere else at least on an occasional basis? If YES, Do you ever go online to acces the internet or the World Wide Web or send and receive email?” 2011: “Do you ever go online to acces the internet or the World Wide Web or send and receive email?” Source: Social Weather Stations, Philippines, 2006-2011

Persaud is convinced that the Philippine online population will continue to expand. In his speech during the YouTube Philippines launch, he said, “The Philippines not only has a large online population, its online population is growing rapidly compared to the rest of Southeast Asia, and especially compared to the West. While North America growing just 3% and Europe just 8%, the Philippines is growing at a remarkable 16% according to ComScore. By comparison, Malaysia is growing at 11%.”

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Low digital ad spending in Asia. According to The Digital Media Habits of Southeast Asian Consumers, an October 2011 study by AC Nielsen, online ad spending in Asia is still generally low. Singapore, with the highest online advertising expenditure in the region, has only 6.9% of its total advertising budget going to digital ads, while Thailand and Malaysia each have less than 1% of their respective totals. Nonetheless, data coming from the 2011 Advertising Forecast prepared by MagnaGlobal, a strategic global media unit responsible for forecasts, insights and negotiation strategy across all media channels, reveal that “Asian markets increasingly incorporated Internet-based advertising into media budgets, and media 5-year growth rates for advertising in APAC [Asia-Pacific] owners’ ad revenues for Internet-based media are rising, up by 15.5% in 2011 and 13.9% each year through 2016.”

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It should be noted, nonetheless, that in the graphic below comparing attitudes about digital advertising in six Southeast Asian countries, digital consumers in the Philippines, along

35

with their counterparts in Singapore and Thailand, failed to register even 50% agreement with any of the three test statements meant to indicate receptivity to digital advertising.

ATTITUDES TOWARD ONLINE ADVERTISING If ads are relevant to my interests and needs I don‘t mind them I‘m happy for advertisers to know my Internet usage patterns if it means I’ll see more relevant ads when I’m browsing websites

%

Ads on websites can be useful at times All digital consumers aged 15 and above Source: “The Digital Media Habits and Attitudes of Southeast Asian Consumers,” October 2011, AC Nielsen, p. 17.

Becoming a YouTube partner Now, local producers of videos that find their way to YouTube will be able to cash in. According to YouTube Product Marketing Manager Rick Silvestrini, speaking in the attached video, the first step in making money on YouTube is to become a partner. To be a YouTube partner, you must create original videos, own the content that you upload, and regularly upload videos that are viewed by thousands of YouTube users. Silvestrini video on how to make money on YouTube

Anyone can apply to be a YouTube partner, and once you qualify to be one, you have a share in the advertising revenues. You just have to produce a video that will make advertisers want to place their ads there. “There’s a couple of things advertisers are looking for when they select where to run their ads. The first thing they often focus on is reaching a specific audience, usually based on age or gender… The second thing advertisers focus on is relevant topics. So for example a sports apparel manufacturer may decide to run against new type of basketball videos if they are launching a basketball shoe.” Silvestrini explained.

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Philippine digital ad spending also Filipino.com site that digital advertising low. In the Philippines, digital advertising in the Philippines only crossed the 1%is also relatively low. In the paper The mark in 2010, around US$20 million. But Philippine Digital Content Market Update he is hopeful that digital ad spending will for 2011 prepared by the Canadian Trade continue to pick up. Commissioner Service of the Embassy of Canada, digital “One encouraging ad spending development is for 2009 is that compared to estimated at one year ago when only 2% of total we talked to brands ad spending, and advertisers, we and has been were asked, ‘why growing at an digital?’ A year average of only later, we were no 1 to 2% over the longer being asked last five years. that question. We Yahoo Philippines Country Manager Jack Madrid In 2010, Yahoo are now being is convinced that local advertisers now see online Philippines asked‚ how do we advertising as part of their overall marketing. Country Sales do it? “They’re Director convinced that Arlene Amarante claims, nonetheless, in they have to embrace it not as a stand-alone Carlo Ople‘s resource blog New Media strategy but as an integral part of their Philippines, that the Philippine digital overall marketing,” Madrid explains in this advertising industry is “rapidly growing.” video interview. She observed that “…while online is still at a 26% penetration level, we see that the landscape is further paving the way for increased and rapid exponential growth – new broadband products, increased broadband penetration, rise of internet mobile, rise of smart phones and the proliferation of low-priced PCs. Consumer behavior support the phenomenon. Online advertising is now a powerful force that no one can no longer deny.” No longer ‘Why digital?’ but ‘How do we do it?’ In 2011, Yahoo Philippines Country Manager Jack Madrid mentioned in a separate interview on The Digital

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A wealth of opportunities for direct communication. The Internet and Mobile Marketing Association (IMMAP) says that digital marketing in the country is still in its inception stage, hence the low media budget allocation. Nonetheless, it maintains that digital media “possess a wealth of opportunities for marketers to communicate directly with their customers.” “Unlike the traditional media television, radio or print where these media serve as channels for advertising placements, digital media provide marketers the opportunity to utilize technology to have a closer

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Log in and be counted

relationship with their customers as these media offer 24/7 communication and engagement, feedback mechanisms, and other Customer Relationship Management tool,” IMMAP added. One of the youngest online populations. Based on the interactive global study Digital Life, conducted by consultancy firm TNS Global, the Philippines has one of the youngest online populations, with an average age of only 22.7 years. In fact, according to this study, 47% of the country’s online population belong to the 21-24 age bracket. Another of the study‘s other interesting findings is the breakdown of the online population into different types of users. According to the study, 83% of the country’s online population are “aspirers.” An “aspirer” is defined by Digital Life as “very new to the Internet and accessing via mobile and Internet cafes but mostly from home.” An aspirer is also described as not doing much online and is “desperate to do more of everything, especially from a mobile device.” Another 11% are “communicators,” who use the Internet to express themselves, using smartphones to get online from home, school or work. Still another 3% are “influencers,” who are “young” and “big mobile Internet users who generally access the Internet everywhere, all of the time.”

The

Another 2% are “knowledge-seekers,” who use the Internet to educate themselves, and are not as interested in social networking as they are in hearing from like-minded people to help them in purchase decisions, and 1% are “networkers,” who access the Internet from home in order to “establish and maintain relationships,” are on the lookout for the latest promotions, and do not express themselves online. Seeing the digital market potential. Even if studies have pegged the majority of the Philippine online population to be young, affluent urban dwellers, data also show that the country’s online population is on the upswing. With the country’s Internet penetration rate at only 19.7% of Filipino adults, there is really nowhere to go but up. For websites like YouTube that make money through online advertising, the local numbers already provide enough of a basis to launch a partner site to sell ads aimed at the local online population. The Philippines finds itself on the ground floor of a local digital market that continues to grow, not just in age but in numbers. Its potential is only starting to be explored, so it‘s not too late to start identifying possibilities and mapping out strategies to tap this potential.

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Log in and be counted

The problem of a digital divide

than people living in rural areas and from the lowerincome groups.

Also mentioned in Labucay‘s paper on Internet Use in the Philippines for Social Weather Stations is her finding that patterns of Internet use in the country reflects patterns of a digital divide, and that said divide “could pose considerable barriers to the wider adoption and spread of Internet use among Filipinos.”

Results from SWS surveys show that Internet use is higher in Metro Manila compared to the provincial areas; in urban areas vis-à-vis rural areas; upper-tomiddle classes vis-a-vis lower classes D and E. Data also from SWS reveal that as of 2010, only 12% of households in the country own a computer. The digital divide is very evident in the table below: 20% of Metro Manila households own a computer while only 6% of Mindanao households have one. The gap between rich and poor is also glaring: 43% of the affluent and middle-classes A, B, and C groups own a computer while Classes D and E combined only comprise 16%.

A digital divide is defined by Webopedia as “a term used to describe the discrepancy between people who have access to and the resources to use new information and communication tools, such as the Internet, and people who do not have the resources and access to the technology.” Furthermore, “the digital divide can exist between those living in rural areas and those living in urban areas, between the educated and uneducated, between economic classes, and on a global scale between more and less industrially developed nations.”

Meanwhile, the percentage of Philippine households with Internet connection is a meager 6%. As far as the using divide is concerned, her findings show that Filipino men and women are equally likely to use the Internet, but also that Internet use among Filipino adults is still low. She also found, however, that the majority of adult non-users are proxy Internet users who can have family members access the Internet on their behalf.

The digital divide, she says, occurs at two levels: an accessing divide, which refers to the gap in access and ownership of computers, and a using divide, which refers to the gap between users themselves. No computers, no Internet connection. The accessing divide reflects differences in location and income, where capital and other urban dwellers who are in the upper- and middle-income groups are more likely to have computers and Internet connections

She also found that Filipino youth between the ages of 18 to 24 are the big drivers of local Internet use, comprising 50% of total users, while adults over the age of 55 comprise only 2% of total users.

THE WIRED AND THE UNWIRED Ownership of computers in the household, Philippines, 1997 to 2010: Percent of households with computers '97

Year Total Philippines Area

Locale Class

3

'98 '99 '00 '01 '02 '03 4

5

5

5

7

7

'04 5

'05 '06 '07 6

6

'08

'09

'10

7

10

11

12

7

10

13

14

Metro Manila

15

19

22

24

25

29

28

18

14

13

16

Visayas

1

2

3

4

2

3

3

2

3

2

5

Balance Luzon Mindanao Urban Rural

2 2

0

7 0

2

7 0

3 1

2 1

2 2

3 2

4 1

5 1

8

10

12

12

13

11

1

1

1

1

1

1

7 3 9 2

5 5

4

20

20

7

6

6

7

20 8 6

8

10

14

17

18

2

3

5

5

6

Class ABC

20

27

33

39

45

47

46

22

23

23

27

33

42

43

Class E

0

0

0

0

0

0

0

0

1

1

1

2

3

3

Class D

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1

2

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2

2

4

4

4

6

6

7

10

12

13

Source: Social Weather Stations, Philippines 1997 to 2010

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Medical Tourism: The Globalization of Health Care The Philippines tries to grab a bigger share of a growing international medical-tourism industry By Tanya L. Mariano

STRATEGY POINTS The Philippines must do more to be globally competitive in medical tourism, projected to be worth $70B by 2013 Our edge: competent, English-proficient health-care professionals Policy must maintain balance between economic gain and equitable access to health care

The

Gone are the days when all the Philippines could offer foreign tourists was the promise of sea, sun, and sand in a tropical paradise. With the increasing ease of international travel, great technological advances, plus the rising costs of health care in developed countries, more and more foreigners are looking overseas for quality health care at lower prices. And the Philippines is now aiming to join the ranks of countries offering them such care. According to Patients Beyond Borders, an online source of consumer information on health travel, the top 10 destinations for medical travelers are Brazil, Costa Rica, India, Korea, Malaysia, Mexico, Singapore, Taiwan, Thailand, and Turkey. Asian countries, in particular, offer the biggest bang for the buck, with average cost savings in India, Malaysia, and Thailand ranging from 65-90%, 65-80%, and 5070%, respectively. Thailand and India vie for the top spot, says market research and information analysis company Renub Research in its description of its “Asia Medical Tourism Analysis: 2008 – 2013” report, which is otherwise available only by purchase.

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40 According to its report summary, Thailand offers “a better overall tourist experience and more bundling of services” – and as a result, receiving the most international patients in 2008 than any other country in the region – while India offers the cheapest health-care services.

& Healthcare Providers (NABH), the health-care forum discussed how the Philippines can develop into a global health-care center with the help of India, a world leader in medical tourism.

According to HealthCORE’s “Philippine Medical Tourism Compendium 2011: Facts, Figures & Strategies,” a report “Without regulation, the potential released at the forum, global medical positive effects may not be realized tourism (also called global healthcare travel, or cross-border health and medical tourism may contribute care), was worth $40 billion in 2010 to a harmful global commodification and is projected to grow to $70 of health-care.” International Journal billion by 2013.

~

for Equity in Health report

The Philippines may have what it takes, but so do others. Speaking at the 1st Philippine Global Healthcare Forum held at the National Kidney and Transplant Institute in December 2011, Department of Health (DOH) Secretary Enrique Ona said that the Philippines has what it takes to become an international health-care hub, but it has yet to maximize its potential, reports The Philippine Star. “While the competence, compassion and communication skills of Filipinos give us an advantage, other countries are also recognizing the opportunities in this global village. Losing out may prove too costly for our country grappling with limited resources for health care,” the Secretary Ona was quoted as saying. Convened by HealthCORE, a local healthcare research and communications firm, in partnership with DOH, the Development Academy of the Philippines, and India‘s National Accreditation Board for Hospitals

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However, a 2008 McKinsey & Company study posits that global demand may not be as big as earlier projected. In “Mapping the market for medical travel,” the research firm pegged the market at just 60,000 to 85,000 in-patient medical travelers a year, significantly lower than the estimated 750,000 Americans who sought treatment abroad in 2007 according to the Deloitte report. Criticizing the McKinsey study, an International Medical Tourism Journal article by writer-researcher Ian Youngman puts the figure at 5,000,000 medical travelers, and panned the study for its use of a non-representative sample – only inpatients were counted, and mostly Joint Commission International-accredited hospitals were surveyed in the study. Other estimates usually include patients who seek out-patient services. Although projections and market size figures vary from source to source, all agree that the industry has massive potential for growth and are optimistic about the

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Medical tourism: The globalization of health care

future of global medical tourism. The discrepancies, however, stress the need for better data reporting and monitoring. Even the United Nations Economic and Social Commission for Asia and the Pacific (ESCAP) admits in its “Medical Travel in Asia and the Pacific: Challenges and Opportunities” report that the figures cited in their study are only indicative, as “information related to medical travel is not captured in a systematic manner,” except in countries such as Singapore, and estimates are usually distorted by differences in units used and calculation methods. At least two other studies echo this sentiment. Both “What is known about the effects of medical tourism in destination and departure countries? A scoping

review,” published in the International Journal for Equity in Health in 2010, and “Medical tourism and policy implications for health systems: a conceptual framework from a comparative study of Thailand, Singapore and Malaysia,” published in the journal Globalization and Health in 2011, found a dearth of empirical studies about medical tourism and emphasized the need for standardized data collection in order to gain better insight into its effects. The latter study provides a conceptual framework which can guide future empirical research into the topic. The following chart from the 2008 Deloitte Center for Health Solutions report, “Medical Tourism: Consumers in Search of Value” highlights 10 medical tourism hubs around the world and offers some statistics:

MEDICAL TOURISM HUBS AROUND THE WORLD Definition: Medical Tourism Medical tourism refers to the act to traveling to another country to seek specialized or economical medical care, well being and recuperation of acceptable quality with the help of a support system

Hungary

Gulf States

• Cost: 40%-50% of U.S. • Mainly used by Europeans • Reliable dental and cosmetic surgery • No JCI accreditation

Gulf States

• Healthcare City designed to provide advanced healthcare services • 38 JCI accreditations total; with 17 in Saudi Arabia

• 450,000 tourists in 2007 • Cost: Avg. 20% of U.S. • 10 JCI accreditations

Thailand • 1.2 million tourists in 2006 • Cost: Avg. 30% of U.S. • 4 JCI accreditations

Mexico

Medical Drivers for Medical Tourism • Cost savings • Comparable or better quality care • Shorter waiting periods, thus quicker access to care

• Cost: 25%-25% of U.S. • High volume of U.S. visitors due to proximity • Mainly dental and cosmetic surgery • 3 JCI accreditation

Singapore • 410,000 tourists in 2006 • Cost: Avg. 35% of U.S. • 13 JCI accreditations

Costa Rica

Global Market for Medical Tourism • World medical tourism market is estimated to be around $60 billion currently; it is expected to grow to $100 billion by 2010 (estimates vary) • Over 500,000 Americans traveled abroad for medical procedures in 2005 • Over 35 countries are serving around a million+ medical tourists annually

• Cost: 30%-40% of U.S. • Mainly dental and cosmetic due to proximity to U.S. • 3 JCI accreditation

Brazil • Cost: 40% to 50% of U.S. • Proximity makes it attractive for U.S. patients • Reliable cosmetic surgeries • 12 JCI accreditations

South Africa

Malaysia

• Cost: 30% to 40% of U.S. • Suitable for cosmetic surgery • No JCI accreditation

• 300,000 tourists in 2006 • Cost: Avg. 25% of U.S. • Mainly cosmetic surgery and alternatives medicine • 1 JCI accreditations

Source: “Medical Tourism: Consumers in Search of Value,” Deloitte Center for Health Solutions, p. 6.

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Asia’s clinical bonanza — boosted by crisis-hit currencies Medical tourism may be a new phenomenon, but medical travel isn’t. In fact, according to the afore-mentioned United Nations Economic and Social Commission for Asia and the Pacific report on “Medical Travel in Asia and the Pacific: Challenges and Opportunities,” the first recorded instances of medical travel go back thousands of years, “to when pilgrims from the Mediterranean region travelled to a small territory in the Saronic Gulf called Epidaurus to visit the sanctuary of the healing god, Asklepios. While tending to their health requirements they also relaxed in the waters, enjoyed the wines of the regions, and travelled within the area.”

However, medical tourism as we know it today only began to develop in the late 1980s and early 1990s, when the government of Cuba started to promote medical travel alongside tourism. In Asia, many countries took to promoting their health-care services in the international market, after the Asian financial crisis of 1997 created a drop in local markets. Devalued currencies allowed for cheap medical services to be available to foreigners, and Bumrungrad International Hospital in Thailand was one of the first to capitalize on this new opportunity. The following chart from the ESCAP report gives an overview of the Asian medical travel industry using 2004 – 2006 figures.

The Philippine Medical Tourism Program. Since 2006, the Philippine government has been trying to boost the country’s competitiveness in health and wellness tourism with the creation of the Philippine Medical Tourism Program (PMTP), a public-private partnership tasked to promote the country as a viable destination for foreign travelers seeking health and wellness services. The program involves partnerships with hospitals as well as spas and wellness centers. The program seeks to make the Philippines globally competitive in medical tourism, thereby improving the quality of health care available to all and preventing “brain drain” by providing Filipino healthcare professionals with lucrative job opportunities right here in the country. Since the program’s launch, HealthCORE revealed at a media briefing prior to the global forum that the Philippines has earned $1.3 billion in revenues from medical tourists, as reported in The Manila Bulletin.

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Despite steady government support – former President Gloria Macapagal-Arroyo’s Executive Order 372, issued in 2004, paved the way for the creation of the PMTP, and the Medium Term Development Plan 2004 – 2010 and Tourism Act of 2009 both call for the development of the industry, while the current Health Secretary also recognizes the industry’s potential to help improve the quality of health care available to all Filipinos – there was “obviously a failure to sustain and effectively capitalize on the momentum of the PMTP,” according to HealthCORE’s report. Sec. Ona also noted, at the global forum, “The Philippines had its share of these benefits, but not in the scale of what these other countries were getting.” In 2010, Thailand, India, and Singapore accounted for 89% of the entire medical tourism industry in Asia, according to the summary of the report, “Asian Medical

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Country

Arriving from

Estimated earnings

Strengths

India

Middle East, United Kingdom, Canada, developing countries

US$ 480 million (2005)

Cardiac surgery, joint replacements, eye surgery

Malaysia

Indonesia, United States, Japan

US$ 40 million (2004)

Cardiology, cardiothoracic surgery, cosmetic surgery

Singapore

Indonesia, Malaysia, Middle East, United States

US$ 560 million

Liver transplants, joint replacements, cardiac surgery

Thailand

United States, United Kingdom, Middle East, China, Japan

US$ 1 billion (2006)

Cosmetic surgery, organ transplants, dental treatment, joint replacements

Source: Medical Travel in Asia and the Pacific: Challenges and Opportunities, October 2007, United Nations Economic and Social Commission for Asia and the Pacific, p. 9.

The study also identifies four main categories of medical travelers today: patients from developed countries without or with inadequate health insurance coverage, patients facing long waiting lists for nonelective surgery or critical procedures, those in search of cheaper cosmetic procedures, and patients who travel to nearby countries with advanced facilities for affordable treatment.

Health care partners under the Medical Tourism Program

Tourism Analysis (2008 – 2012)” (otherwise available only by purchase), published by global market research company RNCOS in 2011. Thailand dominates the industry, receiving 40% of the region’s total tourist arrivals in 2010, while India is the fastest growing, and is expected to corner 38% of the region’s market by 2013.

The following map from www.philippinesheartofasia.ph, the official website of the Philippine Medical Tourism Program, plots the locations of partner health-care providers, most of which are in Luzon. Also available on the website is a menu of medical procedures available under the program, as well as a directory of hospitals in the country and medical travel intermediaries, which operate like travel agencies to assist medical travelers in organizing their trips. More information on wellness centers and hospitals, including their respective specialties, is also available in the Medical Tourism brochure prepared by the Department of Tourism.

What we lack in tourism infrastructure, we apparently cannot replace with what thenHealth Secretary Dr. Francisco Duque III, in his speech at the grand launch of the PMTP in 2006, called “tender, loving Pinoy care,” supposedly our “biggest draw.”

For guidelines on how to become a PMTP partner organization, visit the HealthCORE website (the document is available for free, but requires that you enter your name and email address first).

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The map showing partner healthcare providers (left); Medical tourism Philippines brochure

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44 A presentation by the Asian Hospital and Medical Center at an economic forum organized by the German-Philippine Chamber of Commerce in February 2010 underscored the urgent need for investments in infrastructure, such as airports and seaports, road networks, and holiday resorts “before medical tourism can develop on a larger scale in this country.” With other Asian countries currently mobilizing to strengthen their medical tourism capabilities, the Philippines faces stiff competition, and must act now to boost its competitiveness or miss out on the potential gains from the Asian medical tourism market, which is expected to grow to $8.5 billion by 2013, based on the Renub Research report.

Malaysia’s medical tourism industry is expected to grow by 29.27% from 2009 to 2013, says the report, while South Korea is developing the Jeju Healthcare Town, an $830-million medical complex on picturesque Jeju Island, as reported by Korean industry and technology journal IT Times. Set for completion by 2015, the complex will house a wellness park, a medical park, and a research and development park. Suggestions for improvement. Aside from improving the country’s accreditation process, there have been several recent moves to help attract more medical tourists, among them, the Bureau of Immigration planning to offer special medical visas to foreigners that will allow them to stay in the

Elevating the quality of health care through accreditation The Philippine Council on Accreditation of Health Organizations (PCAHO) is the official accrediting body of hospitals and health facilities under the PMTP. To further ensure that local hospitals conform to international standards, the Department of Health partnered with NABH-International, the global wing of India‘s National Accreditation Board for Hospitals & Healthcare Providers, to conduct hospital accreditation in the Philippines through its country representative, HealthCORE, in 2010. This is the first time the accrediting body is bringing its stringent accreditation process outside India. PhilHealth also performs hospital accreditation, measuring their performance based on its Benchbook Scoring Guidelines then categorizing them into one of the three: Center of Safety, Center of Quality, and, the highest award, Center of Excellence. Several hospitals have also sought accreditation by Joint Commission International (JCI), widely recognized as the world leader in health-care accreditation. To date, four Philippine hospitals have been accredited by JCI: St. Luke’s Medical Center – the first tertiary hospital to become a full partner of the DOH under the PMTP and the second hospital in Asia to be accredited by the JCI (Thailand’s Bumrungrad International Hospital was the first) – The Medical City and Makati Medical Center in Metro Manila, and Chong Hua Hospital in Cebu. The PCAHO, PhilHealth, JCI, and NABH are all accredited by the International Society for Quality in Healthcare, a global non-profit organization that “accredits the accreditors.”

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country for six months without the need to apply for extensions, according to a January 18, 2011 report in the Philippine Daily Inquirer, and Rep. Rodolfo Biazon calling for the creation of a medical tourism bureau under the Tourism Department, to “centralize and integrate functions of eleven government agencies mandated to work together under the existing Philippine Medical Tourism Program of the government.” For its part, HealthCORE’s report recommends “A serious reassessment of the situation and the formulation of remedies and measures to revitalize the PMTP and to make it more relevant and viable in the context of the current trends in medical tourism worldwide.”

in a country with a huge bulk of its population dependent on the public sector for health-care services. Maintains the ESCAP study, “…it should be ensured that (public) investments in medical travel benefit the public health system through mitigating policies which ensure a ‘trickle down’ effect and limit the cost to the public health system.”

Most importantly, the report found the need for the creation of a Philippine Medical Tourism Roadmap to guide policies and make the industry a preferred investment area, as well as for improvement in accreditation and certification systems.

Other recommendations put forth by ESCAP on how to manage the impact of medical tourism on public health systems are: 1) create policies to manage the mobility of health professionals in order to regulate the “internal brain drain” of health workers from the public to the more lucrative private sector, 2) organize trainings on ethics to strengthen professionalism among medical practitioners and ensure that “health-care is not driven by profit motives alone,” and 3) watch out for “sentinel events” (in destination countries) such as escalating health-care costs, techno-centric approaches to health-care, and low staffing in the public health-care sector.

Countering potential ill effects on the public health system. Still, development of the medical tourism industry must not deprive the poor of access to quality health-care, especially

The aforementioned study published in the International Journal for Equity in Health found five main themes regarding what is currently known about the effects of medical tourism on departure and

The study also identified three specific service segments that the Philippines has competitive advantages in: elective surgery, specifically joint replacement, eye care, and cardiovascular care; aesthetic services such as dental care and plastic, reconstructive, and dermatologic surgery; and alternative medicine and wellness treatments, such as diagnostic procedures and regenerative medicine.

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Medical tourism: The globalization of health care

destination countries: 1) the industry is a user of public resources, 2) it can be a source of inequity, 3) it is seen as a solution to health system problems, 4) it is believed to be revenue generating, and 5) it is seen as changing the standard of care. Says the report, “Various commentators point to both the potential for negative and positive effects of medical tourism, marking it as a contested phenomenon. Without regulation, the potential positive effects may not be realized and medical tourism may contribute to a harmful global commodification of health-care.” Proceed with coordination and caution. According to the “Medical tourism and policy implications for health systems” study published in Globalization and Health, “Reconciling the aims of economic growth with

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equitable health service provision and access makes governance of medical tourism within a country’s health system challenging at best and contradictory at worst.” It therefore becomes of utmost importance to setup regulations to manage the effects on the country’s health-care system of this industry that “straddles the policy domains of trade and health.” Investing in infrastructure (including rehabilitating the ailing Ninoy Aquino International Airport Terminal 1) and stepping up marketing efforts to promote the country as a global health-care hub willl make the Philippines more attractive to medical travelers, but the government should be ready to address the side-effects that successful promotion of medical tourism might bring.

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NEWS ON THE NET Business

IMF cuts growth forecast for Asean 5 Europe’s current debt crisis will drag down growth in the ASEAN 5 (Indonesia, Malaysia, the Philippines, Thailand and Vietnam), according to the World Economic Outlook January 2012 update of the International Monetary Fund. In the report, the IMF revised its projected 2012 economic growth of the ASEAN 5 from 5.6 to 5.2%.

to an agreement with Viet Thai International Joint Stock Co. (VTI). A $35 million loan was also extended to VTI as part of the deal. The purchase is the latest in a series of mergers and acquisitions that Jollibee has made over the last few years to cement its dominance in the local food chain industry and to secure a foothold in food chain industries abroad.

Lopez group sells more Jollibee completes Meralco shares to purchase of 50% of Beacon Electric SuperFoods Group

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Beacon Electric is a special purpose vehicle jointly owned by the Pangilinan group’s two companies, PLDT Communications & Energy Ventures, Inc. – a subsidiary of Smart Communications – and Metro Pacific Investments Corporation (MPIC).

Robinsons to open 4 new hotels in first half of 2012

The IMF states that “the global recovery is threatened by intensifying strains in the euro area and fragilities elsewhere. Financial conditions have deteriorated, growth prospects have dimmed, and downside risks have escalated.” Citing an expected European recession, it also slashed its world economic forecast for this year to 3.3 percent from 4%.

Jollibee Foods Corp. acquired 50% of Superfoods Group, which operates several restaurant chains including Highlands Coffee Shop, Hard Rock Cafe and Pho 24. The acquisition, worth $25 million, was made through Jollibee's wholly owned subsidiary, Jollibee Worldwide Pte. Ltd., pursuant

on Feb. 1, it will pump Beacon Electric’s interest up to 48.02% from the current 45.36%.

The Lopez-led First Philippine Holdings Corp. has come to an agreement with Beacon Electric Asset Holdings, Inc. to sell its 30 million Manila Electric Co. (Meralco) common shares at the price of P295 each. The purchase translates to a 2.66 percent stake in Meralco for P8.85 billion. When the transaction is completed

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Robinsons Land Corp. (RLC) is opening a new hotel in Puerto Princesa, Palawan this February. The establishment features 1 08 rooms, and is the first of four new hotels that will mark the beginning of what RLC envisions to be an extensive chain of Gohotels with budget accommodations across the country. The success of the first Gohotels establishment, which stands at the Cybergate Plaza in Mandaluyong, is likely what prompted RLC to start the chain. Gohotels are also set to open in Bacolod, Dumaguete and Tacloban by the first half of 2012 – which will bring up the number of hotels to five, and the total number of hotel rooms to 639.

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Tech Trends in 2012 The hypermobile consumer, not the stodgy enterprise, now drives the future of technology By Marishka Noelle M. Cabrera

STRATEGY POINTS Advances in technology are now driven by consumer-centric innovation Mobility and connectivity will shape the tech landscape in 2012 The influences of women and emerging markets, especially in Asia, continue to grow, and will shape the digital mainstream and the global electronics industry

By the end of 2011, a plethora of material on the rise and fall of technologies straight from the mouths of soothsayers of the tech world flooded news sites and blogs alike. Some focused on upcoming products, while others took on a broader approach, emphasizing current market tastes and attitudes. Here’s a look at the latest trends in the technology business, and why it pays to put the consumer at the heart of the company’s innovation strategy. Greater mobility, interconnectivity, sociability. As exemplified by the continuous development of smartphones, tablets, apps, and televisions, 2012 will be characterized by greater mobility, interconnectivity, and sociability. In CNN’s “The Top 10 Trends for 2012,” touch computing as in the iPad, spatial gestures or motion-sensing input devices as in Microsoft’s Kinect, and voice control as in Siri on the iPhone 4s are just a couple of trends that Pete Cashmore of Mashable.com sees becoming bigger this year. Meanwhile, editors of digital-centric media company IDG Enterprise share their predictions in a video in the Computerworld article, “IT trends to watch in 2012.” They say that mobile and social technology will still be relevant. They warn, however, that increased mobility and interconnectivity, including cloud computing, could bring about security challenges. The blurring of lines between work and personal life could lead to data leakage and mobile malware. Consumer-centric is becoming the new mantra. Ultimately, what drives

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Tech trends in 2010

trends in technology is the consumer. Whereas the old model of technological innovation was centered on office technology and enterprise solutions, nowadays it is the consumer who dictates the movement of technology based on his lifestyle, preferences, and behavior. In “Power shift! What happens when consumers drive technology markets” from IT research firm Gartner, author Mark P. McDonald reiterates, “There was a time when IT was driven by enterprise demands and consumers had little or no influence in shaping technology.” Now, however, the consumer market is “beginning to matter more to technology providers than business marketplace and demands,” primarily because the ever-changing preferences of the consumer market offer vast opportunities for innovators. “Business technologies will not go away. However, their position as the premier incubator of innovation is under threat as consumers now represent a viable, scalable, reachable and mass market for new solutions and technologies,” McDonald concludes. The shift from enterprise to individual is prompted, in no small part, by changes in how consumers relate to their gadgets. For instance, the article in Google’s Think Quarterly entitled “The Mobile Metamorphosis” takes a peek at how the mobile phone has evolved from a mere communication device to one that is a reflection of one’s self. “Phones no longer merely connect us to people; as their available features grow more complex,

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customizable, and personal, they connect us to ourselves,” the article says. The age of hypermobility. More and more, our new gadgets are also connecting us to our offices. Global market intelligence and advisory firm International Data Corporation predicts 1.3 billion workers will go mobile by 2015. Minus the physical setting of the office, workers are still able to access data and be productive from just about anywhere with an Internet connection. Amid the growing popularity of smartphones, apps, and tablets, mobility is fast becoming the new craze in business. International Data Group editors say “Despite recent increased mobility and interconnectivity market turmoil, will be accompanied by security challenges mobility continues to be a critical part of the global work force, and we expect to see healthy growth in the number of mobile workers,” says Stacy Crook, senior research analyst for International Data Corporation’s Mobile Enterprise Research program.

In relation to this, industry leader IBM is adapting a trend known as “Bring your own device,” or BYOD. BYOD is based on the idea that workers can, at present, be more effective when using their own gadgets, since they are very much familiar with the software, apps, and the like. An October report in Computerworld estimated that by the end of 2012, 200,000 IBM

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50 employees will be able to connect to IBM’s internal networks using their own handheld devices, comprising half of IBM's global workforce. Always on, always connected. In Accenture’s “Always On, Always Connected: Finding Growth Opportunities in an Era of Hypermobile Consumers,” the global management consulting, technology services, and outsourcing company surveyed more than 10,000 consumers across 10 countries and found that consumers are “making their networked lives more robust: connecting in more than one way and on multiple devices, consuming more content, and doing it all on the go.”

What’s in and what’s out in 2012 In 2011, social media was all the rage, judging from the monumental events that happened in the Arab Spring. In 2012, mobility is key. With delineations of work and play bleeding into one another, devices that can seamlessly connect the different roles one has in life will inevitably replace the single function gadgets consumers have grown accustomed to. A Los Angeles Times article published in the Business Mirror predicts the demise of 10 tech items that have, unfortunately, been replaced by multi-purpose gadgets, such as the smartphone. The article explains why: “Because they did one thing and one thing only, and a person can carry only so many devices in their coat pockets or purses, no matter how small.” So bid adieu to the Flip cam, a lightweight digital camcorder; CD player; flash drives, thanks to the growing popularity of cloud computing; GPS devices for the car; the small digital camera; fax machine; Netbooks; portable DVD player; voice recorder; and the PDA, if you haven’t already.

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The report touched on the following trends: • consumers are in a state of “hypermobility” wherein they adopt mobile technologies that help them stay connected anytime, anywhere; • consumers are modifying their behaviors as they rely on cloud services; • the use of electronics is becoming dependent on the number of apps within consumers’ reach, and; • emerging markets are leading the growth of many consumer technologies. “Leading providers will need to combine continual innovations in products, cloud services and application offerings with sophisticated targeting

So what’s in store for techies out there? In the annual Consumer Electronics Show or CES this year, a myriad of gadgets from the functional to the whimsical tickled the fancy of tech watchers, with the best products outlined by PC magazine. Then again, “don't expect anything Earthshattering,” a CNNMoney article says. Today’s device market is all about smartphones, tablets, personal computers, and other gadgets that are without a doubt faster (and most of the time, better) than its predecessors. But the real battle is in the software running them. “Consumer electronics are becoming a simple conduit -- a dumb pipe for scintillating software.” Products that created a buzz, though, are the Ultrabook, voice- and motion-controlled TV, and a projector that could turn any surface into a touchscreen. According to a Yahoo! report, the Ultrabook is essentially a very thin laptop, no more than 0.8 inches thick, runs a full version of Windows, with “super-long” battery life, and is generally more powerful than netbooks but is not as cheap, starting from “$899 and . . . up into the

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of profitable consumer segments to win the hearts and wallets of today’s hypermobile consumers,” the report recommends. Coming: information at your fingertips. John Gallant, Chief Content Officer at IDG Enterprise, posits that as people “tap into the tools and technologies that allow them to mine the wealth of information from social networks, from the larger web” it allows them “to really start to make better decisions, and decisions more in real time.”

Consumer Trends for 2012.” Among them is the Point-and-Know trend that enables consumers to use their devices for instant information gratification. So far, textual search and information is what is made available to users most of the time. However, the article says, “The race is on to add a (useful) real world element – and by ‘real world’ we mean the world of objects and people.”

Companies are already leading the way through their apps. Using Google Goggles, users can search items based on photographs taken on a handheld device. The Amazon Trendwatching.com, one of the world’s flow app allows consumers to access leading trend firms, foresees “12 Crucial information about products, such as books, music, film, and household items— and buy them. mid-$1300-$1500 range.” Launched in 2008, the original Ultrabook is the Macbook Air. Women are the digital mainstream. “Women on the CNNMoney reports Samsung unveiled a new Web: How Women are Shaping generation of TVs controlled by voice, gestures the Internet,” a 2010 study from and facial recognition. In a keynote address, comScore, a digital marketing Samsung’s consumer electronics division intelligence source, found that president, B.K. Yoon, said the future TV will “listen, women more than men are the see and do what you want, without ever touching driving force of the Internet. the remote control.” Another CNN article discusses other developments in TV such as TVs with OLED (organic light-emitting diodes) screens instead of “Women across the world plasma or liquid crystal screens, TVs that connect are driving some of the most seamlessly to the Internet, and TVs that have mainstream aspects of the bigger, thinner, lighter screens, and better sound. Internet experience today— the social Web, e-commerce . A comparatively small company based in . . shopping and consumption Washington, MicroVision developed a “pico of user-generated content via projector with a touch-interactive display,” YouTube,” according to a report from the Huffington Post. the study found. Further, “It has the power to transform anything you project onto a wall from your laptop or Consequently, Branding Magazine smartphone into a touch-friendly screen.” Imagine advises marketers to tap into key running your fingers over the projection and groups within this demographic, being able to manipulate its contents--not bad particularly affluent women and for presenting a business proposal, or for simply having fun. mom consumers. According to the

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article “2012 Digital Design Trends through the Consumer Behavior Lens,” affluent women born from 1946-1964 will “boast more consumer clout” in 2012. Moreover, the article says 51% of online women are moms, who “use social networks more frequently, and longer, and readily share information about their kids and education online.” Today’s women, Branding Magazine notes, divide their attention among the smartphone, laptop or desktop, and tablet. “Because of their economic influence, this three-screen woman is the paradigm for the retail consumer.”

Asian influences. A report by the Economist Intelligence Unit suggests that as Asian economies rise, so does their influence in the global electronics industry, mainly due to the impact of greater consumerism in the region. In “Rising consumption, rising influence: How Asian consumerism will reshape the global electronics industry,” four trends in the industry are identified:

Asia will leapfrog many stages of technology development, driving new forms of electronic hardware, software and services; Asia’s urban population will increase, driving demand for new types of electronics products, but rural markets

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In short, Asian consumerism will cause companies to develop technologies best suited for the Asian market and, eventually, influence the design and technology of products made for Western markets. “Importantly, as Asia’s markets grow deeper and richer, the technology that arises from them will see Asia dictate ever more of the global electronic standards that define future technology directions,” the paper adds.

As such, the article says, “Expect to see these trends illustrated through responsive web design, optimized social media engagement, time-saving apps, and digital tools that answer lifestyle dilemmas.”

will also become increasingly attractive; While rising incomes drive consumerism in Asia, they also undermine its strengths in low-cost manufacturing. This will cause a rethink about the nature of branding, both for Asian and non-Asian companies, and; The growing influence of Asian design and innovation will push electronics in new directions—and see the rest of the world take on Asian ideas.

In-house innovation capabilities more critical than ever. An Accenture study on “Achieving High Performance in the Consumer Technology Industry: The Critical Role of Innovation” shows the market is “demanding that consumer technology become more flexible, connected and social.” With the shift from technology- to consumer-led innovation rapidly transforming the industry, “the strength and maturity of a company’s innovation capabilities will be more critical than ever.” The study emphasizes, “In fact, such capabilities will determine which consumer technology companies become the high-performance businesses of tomorrow.”

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Western Digital hard drive prices rose 47% after Thai floods Last year, analysis predicted that the personal computer industry would be affected greatly by the floods that devastated Thailand last October. The disaster did have a noticeable effect on the prices and the availability of hard drives; an earnings report from Western Digital (WD) shows us exactly what the damage is from the perspective of the hard drive manufacturers. The prices rose 47% to $69 per unit, resulting in a 45% fall in hard drive unit sales by WD compared to the year before. WD said that its Thailand factories should be back to full capacity by September 2012.

Off the RIM: The worst co-CEOs of 2011 step down Famous for making the Blackberry mobile– and now struggling to make it in a market dominated by Android and the iPhone– Research In Motion (RIM) experienced a shakeup last week when co-CEOs Jim Balsillie and Mike Lazaridis stepped down from their co-positions. Replacing them is former RIM COO, Thorsten Heins.

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RIM shares slipped when the news broke, reportedly due to the perception that Heins is too close to the problem to offer any solution. This perception was somewhat validated when new CEO Heins was quoted as saying, “I don't think there is some drastic change needed.”

The new feature, which melds Google’s search engine and social network services, was launched to allow for a more “personalized” and “more relevant” Internet search experience, according to Google. Critics claim that the new feature favors a searched entity‘s Google+ page even when its corresponding Facebook, Myspace or Twitter page is more active and current.

South Korea's nightly gaming ban extends to Xbox Live

Facebook to Google: “Don‘t be evil” Developers from Facebook, Myspace and Twitter debunked claims by Google that the search company’s new “Search, plus Your World” feature is unable to show Google+ rivals’ contents due to technical limitations. The group, called “Focus on the User” showed through its own online testing tool and video that Google‘s regular search algorithm already does what it claims its new search feature can‘t do.

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Last year, South Korea enacted what is now called the “shutdown law” or the “Cinderella law,” to prevent children under the age of 16 to game online between 12 AM and 6 AM. The law, part of the country’s attempts to address its populations’ growing video game addiction problem, was originally meant for computer games, but was later on extended to include console games. Sony's PSN complied a few months ago and, starting February 1 of this year, Microsoft's Xbox Live will also be offline after midnight. An article published in the American Journal of Drug and Alcohol Abuse suggests that video game addiction may lead to the brain’s “desensitization” to rewards.

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TCR Volume 2 Issue Number 4  

January 30-February 5, 2012

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