BusinessMirror May 6, 2015

BusinessMirror

THREETIME ROTARY CLUB OF MANILA JOURNALISM AWARDEE 2006, 2010, 2012

U.N. MEDIA AWARD 2008

A broader look at today’s business TfridayNovember Wednesday, May18, 6, 2014 2015 Vol. 10 No. 40 209

www.businessmirror.com.ph INSIDE

El Niño threatens inflation outlook

MACBOOK Such a good teacher

EAR Jesus, although You had forewarned Your disciples about what awaited You in Jerusalem, they just could not accept the idea that such a good teacher would suffer a violent death. As to the hint that You would also rise from the dead, they simply were not able to understand what such an expression could mean. That is why, when the first part of the prophesy came true, their faith was badly shaken and found themselves confused and uncertain as to their own future. May we have the grace to sustain and live our deep faith. Amen.

EXPLORING GOD’S WORD, FR. SAL PUTZU SDB, AND LOUIE M. LACSON Word&Life Publications • teacherlouie1965@yahoo.com

Editor: Gerard S. Ramos • lifestylebusinessmirror@gmail.com

Life

APPLE WATCH DELIVERY SLOWED

BY FAULTY PART, REPORT SAYS »D2

BusinessMirror

Wednesday, May 6, 2015

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Apple’s new MacBook takes thinness to an uncomfortable extreme B T W | San Jose Mercury News

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REALLY wanted to love Apple’s new MacBook. But I just can’t.

When I heard that Apple was coming out with a computer that’s lighter than my new MacBook Air and has a sharper screen, I immediately regretted the fact that I hadn’t waited a few more months before buying my latest laptop.

After using the MacBook, however, I no longer regret my decision.

Apple’s taken its obsession with thinness a step too far for my taste. I like how thin and light the new computer is, but I don’t appreciate the trade-offs, which make the MacBook impractical and uncomfortable to use.

The MacBook represents the next step in Apple’s minimalist attitude toward computer hardware. At 2 pounds and half an inch thick at its fattest point, it’s a featherweight. Compared to my clunky work-issued laptop and even my own MacBook Air, the new MacBook was a joy to carry around, barely noticeable in a backpack. At that weight, it also rests easy on your lap.

Despite being so light, the MacBook feels sturdy, because Apple has encased it in an aluminum enclosure similar to the ones used with its other laptops. And despite its size, the computer has a full-sized keyboard and a screen that, while it isn’t giant, is of decent size and is larger than that on the entry-level MacBook Air. Apple also packed a relatively long-lasting battery into that tight space. The company says the MacBook will endure about 10 hours of active use before it needs to be plugged in. I didn’t test that precisely, but did find that I was able to use it for much of a business day without needing to recharge it.

Besides the MacBook’s size and weight, its other standout feature is its screen, which is a high-resolution “Retina” display.

This marks the first time that Apple has put such a screen, which purports to have pixels so tiny that they can’t be distinguished by the average human eye at normal distances, in one of its consumer-oriented laptops. If you are familiar with such screens

C  D

More apps, longer Internet hours MAKE summer your favorite season ever with Globe Telecom and its consumable data plan GoSURF, which allows you to surf all the sites you want and gives you free access to popular applications, such Viber and Facebook, as well as premium content, such as Spotify and Piso Mall, the country’s first-ever one-stop shop video content store with over 200,000 videos available.

Plan summer escapades with GoSURF50, which gives you 300 megabytes of mobile surfing so you can browse through travel sites, book hotel accommodations, read travel reviews, chat with friends, and share posts and photos on mobile complete with free access to Viber and Facebook. GoSURF50 also comes with free access to Spotify so you can check out the latest songs you can play during trips, as well as free access to Piso Mall to view the perfect summer videos and clips with your travel buddies. Do all these for three days for only P50.

“As the leading purveyor of the Filipino digital lifestyle, we want our prepaid customers to have more fun this summer so we are boosting our GoSURF promos with more mobile data allocation so they can enjoy their mobile Internet experience without spending too much. We also want to give them more of what they love so we’re bundling our GoSURF promos with free premium content, such as Facebook, Viber, Spotify and Piso Mall to fully enable their digital lifestyle,” says Issa Cabreira, Globe senior vice president for consumer mobile marketing.

To know more about GoSURF promos, visit www.globe.com.ph/ gosurf.

LIFE

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RIVERINE

ARTS Art

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B T G V titovaliente@yahoo.com

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of bodies of water. Where the rivers are painted in complementary colors, in lights that are brisk and harsh, the estuaries of this great river turn murky, dark and— from visual inspection—without life.

It takes awhile for Abrenica’s audience to realize that while he foregrounds the river, his riverscape involves always those living by the water. These are people who, despite the wealth of transaction hovering over the river, do not partake of the luxury and comfort of those human engagements. It is, thus, that the yellow and violet, for all its tonal charm, remains a visual vocalize, a sound without words. The stasis and poverty of the cluster of houses are mirrored by the river that does not seem to move. It is not calm but stagnant.

The red—look again, for it is of that notorious fuchsia tint—horizon is what we are drawn into. That color shocks...but not enough to make us forget that there is a river going into it. That is where the caution of this paintings lies: the river does not go into infinity but is blocked into stasis again by a horizon that is unforgivingly strong. On either side are artificial

balustrades and riff-raffs. There are no river banks here, just man-made interventions.

Interestingly, Abrenica reserves his somber tones for the painting of the river right where the image of the Virgin of Peñafrancia is brought down from her barge and returned to her shrine in the Basilica.

Doods Santos, a literature scholar and critic, was looking for her own river in a project called “Susog Salog” (literally, “to follow the river”), when she found out about Abrenica’s works. T To Doods, Abrenica is the only visual artist who has focused on the river as a topic for his paintings. These images of the river—destitute and dank—are what pushed social activists, creatives, cultural workers and other artists to forge a river of memory. Initiated by Dr. Merlinda Bobis of the University of Woolongong University, the project involves primarily Ateneo de Naga University and Camarines Sur National High School.

The activity is a community arts and culture-based project designed to support the Integrated Naga River Revitalization Project.

B C U. O

HE National Economic and Development Authority (Neda) on Tuesday raised the alarm that, while for the moment inflation remains low, the El Niño phenomenon could upset the carefully calibrated macroeconomic numbers and drive commodity prices higher.

Cheaper food and fuel, as well as lower electricity prices, caused the country’s inflation to slow to 2.2 percent in April, the slowest since August 2013, when this averaged 2.1 percent.

Neda Officer in Charge and Deputy Director General for Planning Emmanuel F. Esguerra said prices could increase anew if the government does not implement measures to ensure ample food supply.

www.businessmirror.com.ph

Riverine arts UILLERMO “BOYET” ABRENICA paints Bikol and the Naga River. Dr. Paz Verdades M. Santos, or Doods to those who know her well, searches for the river.

Abrenica and Santos are part of a socio-art movement that draws inspiration from a river that defines the city of Naga and, stretched into the sea, a big part of the Bikol region.

Abrenica, it appears, has found his river. It is a body of water seen through prisms of his imagination and ardor and candor. The painter, based on an interview conducted by Doods Santos, recalls how the three paintings, which appear in this piece, were done in three different spots. T Two of the paintings—the one in violet and yellow, and the other in red and green—are views of and from the commercial parts of the city, where bridges connect lands and also cover the natural contours

The Naga River is being revitalized but the people have no distinct and emotional memory of the river. The Susog Salog, through the fusion of the humanities and sciences, of arts and sciences, wants to look into how the ecology is part of the heritage of the communities.

Cultural mapping and storytelling from those living near and by the river, especially the senior citizens, form the main tributaries of this tribute to an old river.

The paintings of Abrenica depicting what the river has become is now part of Susog Salog, Abrenica found his rivers and caught them in 18"x 18" canvases. The movement Susog Salog should find in these works of an artist—and, hopefully, in more artists—appearances of a river that is dying so that it could be remembered and be given life again. n

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‘Art for a Cause’ A Y. Joy Rojas II has successfully gathered ATT several well-known artists from the Saturday Group and other established artists to showcase their artworks at The Medical City Lobby, Ortigas Avenue, Pasig City, from May 8 to 22, in a fund-raising exhibition, dubbed “Art for a Cause.”

Proceeds from the sales will benefit The Medical City Liver Center, headed by Dr. Vanessa de Villa for indigents waiting for liver transplants. Dr. Vanessa de Villa, who leads the team of surgeons, has successfully achieved the training required abroad, tremendously reducing the amount to be spent for this critical procedure by enabling it to be conducted in the Philippines. Art for A Cause showcases some 50 paintings donated by the country’s top visual artists and sculptors with guest artist photographer Mandy Navasero presenting her portfolio featuring the island of Batanes.

Donna Sy at the Hiraya Gallery DONNA DELACUESTA SY Y is exhibiting until May 15 her recent oils at the Hiraya Gallery (www.hiraya.com) on United Nations Avenue in Ermita, Manila. In “Behold, All of Me,” the artist bares her soul completely.

In her words, “And so here I am. Like a sheet, wrung and left out to dry. But it is a beautiful day, the sun is shining like there is no tomorrow and the wind is making everything dance gently. I am clean and I am white again.

While I dry I know I am not better than you, nor are you better than me. We are equal. Tomorrow is another day and it will be a good day and it will be a good day to let the colors seep through again.”

Martha Atienza’s first solo exhibition SILVERLENS (www.silverlensgalleries.com) www.silverlensgalleries.com) presents www.silverlensgalleries.com “Study in Reality No. 3,” Martha Atienza’s first solo exhibition with the gallery. The show brings to focus a different facet of Atienza’s art practice, as the artist’s works continue to expand as she explores the porous boundaries between art and life.

The opening reception is on May 7 at 6 pm, and the exhibit will be on view until June 6 at Silverlens Manila.

Atienza’s works are direct reactions toward her environment, particularly in Bantayan Island, a fishing community situated in the northwestern end of Cebu.

Her identity is deeply rooted in the place: her father was born in Bantayan, while her grandfather manned the lighthouse in Tangigue, an island off the north coast. She spent her time between the Netherlands (where her mother is from) and the Philippines while growing up, which has led to a desire for understanding through synthesis the conditions of two different worlds.

The Dutch’s effective policies to protect them against nature was in stark contrast with the Filipinos’

struggle in controlling their environment.

It’s what Atienza has come to address in her artworks, as the “crevices between understanding and imagining,” and the “constant dance between the ideal and the real.”

ART

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BusinessMirror E1 | Wednesday, May 6, 2015 Editor: Tet Andolong

CONVERGENT LIVING IN BGC

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N line with promoting convergent living in Bonifacio Global City (BGC), Alveo Land Corp. has introduced the new 49-story Park Triangle Residences, which will be in the 2.3-hectare Park Triangle.

Park Triangle Residences is Ayala Land Inc.’s (ALI) newest integrated hub situated just by Serendra and Market! Market!.

PARK Terraces Ground Floor

AYALA Mall Park Triangle

“At the crossroads of bustling corporate and lifestyle rows, Park Triangle Residences is set to redefi ne convergence as its remarkable location places it at the center of nearly everything in BGC. This residential condominium component within an integrated mixed-use district will become the ultimate point of convenience for its residents,” said Anton Sanchez, division manager for Project Development, in a recent media briefing held at Alveo’s head office in BGC. Sanchez said Alveo is excited in its newest project because it is continuing the stellar tradition of ALI in developing projects that have created impacts, such as Forbes Park, Ayala Alabang and Nuvali. “The entry of ALI has transformed BGC into a business hub.”

Being positioned as the center of gravity in BGC, Sanchez said Park Triangle Residences provides accessibility, work and business, relaxation and artistry. He noted Park Triangle Residences will be the district’s sole residential project and will become the landmark tower upon entering BGC from the north. “It is located along the main thoroughfares of BGC, offering

unmatched accessibility to work, dining, shopping, education and entertainment scenes,” Sanchez added.

Furthermore, Park Triangle Residences will also be the only property in BGC to offer direct access to an Ayala Mall. Residents can easily access the mall through exclusive fourth-floor access and elevators from the ground floor.

Ayala Mall Park Triangle will be right below the residences, occupying the first five levels, with premium retail and specialty food concepts, a supermarket and top global fashion brands. The highend lifestyle mall will offer over 23,000 square meters of gross leasable area.

As BGC’s new center of centrolineal living, Sanchez said Park Triangle will be a mixed-use development with several integrated components.

For business, it will have the Park Triangle Corporate Plaza, an office building launched in August 2014, achieving blockbuster sales of P4.95 billion, or 61 percent of its inventory in just one day.

He said Alveo Land will build two more office towers, which are set to rise within the district: another office condominium to be launched

PARK Triangle master-plan

by Alveo Land; and Park Triangle Corporate Center with office spaces for lease to business-process outsourcing and traditional locators.

Fourth, Ayala Mall Park Triangle will anchor this new lifestyle hub with Park Triangle Residences

Sta. Lucia to develop 16 projects B R L. A

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ROPERTY developer Sta. Lucia Land Inc. (SLI) will be entering into joint ventures (JV) for 16 projects in the pipeline aimed at strengthening its presence in emerging cities and nearby provinces nationwide.

The company disclosed on Wednesday that it has been authorized by the board of directors to get involved in partnerships to develop various projects in the areas of Batangas, Davao, Laguna, Pasig and Rizal.

SLI will work on seven JV development projects in Barrio San Miguel, Pasig City, with an aggregate area of 8,423 square meters (sq m).

In Davao the real estate developer will co-establish a new project in Eden spanning 985,292 sq m, as well as two separate projects in Ponte Verde, with areas of 36,915 sq m and 28,751 sq m, respectively.

At the latest, four tie-up projects are lined up in Rizal province.

In Cainta it will develop a new project with a total area of 16,026 sq m; Taytay, 8,318 sq m; Binangonan, 29,492.62 sq m; and Barrio Pasong Matanda (also in Cainta), 51,969 sq m.

Meanwhile in Bauan, Batangas, and Santa Rosa, Laguna, the company will build news projects with an area of 246,653 sq m and 27,500 sq m, accordingly.

The publicly listed firm will also acquire parcels of land in

Barangay Balayong (also in Bauan, Batangas) at 337,715 sq m and Jaro, Iloilo, at 7,500 sq m.

To bankroll its land-bank acquisitions, acceleration of ongoing projects and funding of new projects, SLI is set to issue debt instruments worth up to P6 billion.

For the full-year 2014, the realestate company reported a growth of 83 percent in net income, to P548 million from P300 million, two years ago on the back of strong take-ups on its various development projects.

Also, contributing to such profit hike were the real-estate revenues amounting to P1.445 billion from P801 million—an 80-percent increase year on year.

right on top, crowning the district as its landmark residential component.

The BGC’s school district plays host to British School Manila, International School Manila, Manila Japanese School, DLSU, UP

Professional Schools and more situated within the site.

For recreation, Park Triangle will also house KidZania Manila as the mall’s anchor. The interna-

tionally popular “edutainment” (education entertainment) center offers children aged 4 to 14 years a unique role-playing experience in an indoor theme park.

Park Triangle is at the corner of 32nd Street, BGC’s corporate row, and 11th Avenue—one of the main lifestyle strips of the city. 32nd Street is also the main road leading to the Makati, Ortigas and Quezon City central business districts. 11th Avenue, on the other hand, ties together a string of lifestyle strips, Serendra, Bonifacio High Street and, soon, High Street South, where most of the city’s top leisure and retail options are based.

Prices will range from P6.5 million to P44 million. The tower offers 616 units in studio, one-, two- and threebedroom formats. Amenities include Amenity Garden Deck on the fifth level. It offers a 28-meter lap pool, kiddie pool, Jacuzzis, trellis garden, a yoga area, lawn, playroom, gym, lounge, function room, boardroom, view deck and a jogging path.

The tower will be completed and turned over beginning the first quarter of 2021.

SIKATPINOY SHOWCASES AT MEGATRADE

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N connection with the Philippines’s hosting of the AsiaPacific Economic Cooperation (Apec) summit this year, the Department of Trade and Industry SikatPinoy National Handicrafts Fair will be showcasing not only products from the country’s 16 regions, but also from some of the Apec member-economies.

With the theme “Piling-Piling Produktong Pilipino,” the handicrafts edition of the 2005 SikatPinoy national trade fairs will include indoor and outdoor furniture; houseware and décor such as linen, lighting fixtures, tabletop accents; gift and novelty items; and health and wellness products.

This retail and order-taking event aims to expand the market presence and open up business opportunities for Filipino small and medium-sized enterprises from the regions. At the same time, special settings and pavilions will feature guest exhibitors from Apec member-economies.

The DTI SikatPinoy National Handicrafts Fair is scheduled from May 6 to 10 at the Megatrade Halls in SM Megamall, Mandaluyong City. The fair is open from 10 a.m. to 9 p.m. Admission is free. www.facebook.com/sikatpinoyfairs

PROPERTY SALLY LOPEZ (left) of A&M Luckyland Realty and new lot owner Joel Viado.

TCT TURNOVER AT SANDARI BATULAO

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ITYSTATE Properties and Management Corp. (CPMC) turned over the Transfer Certificate of Title (TCT) to Joel Viado for a lot he purchased at Nalé, Sandari Batulao, on April 26. The turnover took place at the marketing pavilion of Sandari Batulao.

CPMC is the developer of Sandari

Batulao, a luxurious eco-centric mountainside residential and leisure development with majestic Mount Batulao as its backdrop. Sandari Batulao is just 10 minutes from Metro Tagaytay and 15 minutes from the beaches of Nasugbu, Batangas. www.sandaribatulao.com.

PLDT ON COURSE TO HIT 2015 CORE INCOME GOAL B L S. M

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ALVEO AT BGC ALVEO PROMOTES

P.  |     | 7 DAYS A WEEK

NEDA SAYS MEASURES NEEDED TO ENSURE STABLE FOOD SUPPLY, PRICES

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ROFITS of telecommunications giant Philippine Long Distance Telephone Co. (PLDT ) re mained flat at P9.4 billion in the first three months, as its revenues and expenses barely changed.

During the period, consolidated revenues stood at P42.6 billion, while expenses remained at P30.4 billion. This brought core net income— which excludes onetime gains and losses—to P9.3 billion, half a billion lower than the P9.8 billion recorded in the same period the year prior.

The number, however, according to company executives, was in line with the core

PESO EXCHANGE RATES n US 44.6530

income guidance of P35 billion for 2015, a bit lower than the one booked in 2014 due to lower earnings and higher financial costs.

“We’ve gone ahead of the numbers that we expected for this quarter. The number is on track with our core profit guidance this year,” PLDT Chairman Manuel V. Pangilinan said on Tuesday.

Smart, Sun lead mobile front

DURING the same period, wireless subsidiaries Smart Communications Inc. and Digital Mobile Philippines Inc. (Sun Cellular) together led the industry in terms of revenues and subscribers.

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PHILIPPINE Long Distance Telephone Co. (PLDT) Chairman Manuel V. Pangilinan (third from left) answers questions during PLDT’s media briefing on its 2015 firstquarter financial and operation results. Joining him at the briefing are (from left) PLDT Senior Vice President and Treasurer Anabelle L. Chua, PLDT President and CEO Napoleon L. Nazareno, and PLDT Regulatory Affairs and Policies Head Ray C. Espinosa. ALYSA SALEN

SPECIAL REPORT

Timta, RFI could cost P-Noy business support B J M N.  C  C N. P Conclusion

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EPEATED warnings of slower flow of investments and reduced competitiveness—should the Tax Incentive Monitoring and Transparency Act (Timta) and the Rationalization of Fiscal Incentives (RFI) bill hurdle Congress—bode ill for the Aquino administration, which has already endured a beating in its final leg after

the Mamasapano tragedy in January.

So, realizing the possible backlash, especially the likely withdrawal of business-sector support for President Aquino, leaders in Congress quickly gave the assurance that these two bills would be passed fairly and transparently.

“Actually, we discussed Timta and the RFI bill during our monthly meeting with our Senate counterparts on Monday,” House Committee on Ways and Means Chairman and Liberal Party Rep. Romero S. Quimbo of

Marikina City said, noting that they took into account the concerns and fears of the private sector over the two proposed measures.

“With the [lower chamber] version of the Timta and the RFI bill, currently under deliberation in the House Committee on Ways and Means...they don’t have to worry,” Quimbo said, in reaction to a three-part special report of the BM, titled “Timta, RFI could cost P-Noy business support.”

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n JAPAN 0.3717 n UK 67.5377 n HK 5.7594 n CHINA 7.1917 n SINGAPORE 33.5308 n AUSTRALIA 35.0165 n EU 49.7792 n SAUDI ARABIA 11.9075 Source: BSP (5 May 2015)

A2 Wednesday, May 6, 2015

BMReports BusinessMirror

www.businessmirror.com.ph

Timta, RFI could cost P-Noy business support Continued from A1

The monthly meeting was attended by Quimbo, Speaker Feliciano Belmonte Jr., House Majority Leader and Liberal Party (LP) Rep. Neptali M. Gonzales II of Mandaluyong City, Senate President Franklin M. Drilon and acting Senate Minority Leader Vicente Sotto III. Indeed, lawmakers need to assuage the fears of businessmen. For an administration that has proven to be too reluctant to spend public money to spur growth, a greatly reduced private-sector investment would certainly cause further economic slowdown.

The Asian Development Bank said that, when the pace of growth decelerated by almost 1 percentage point to 6.1 percent in 2014 from the average of the previous two years, the main culprit was the slowdown in government spending. In 2014 public expenditures only amounted to P1.982 trillion, or 13 percent below the programmed spending.

Timta

Still, Quimbo said the House of Representatives is set to pass the Timta before its sine die adjournment on June 11, while the RFI will hurdle committee deliberations in June and is targeted to be reported at the plenary before the President’s State of the Nation Address on July 27.

Quimbo has already said the Senate and the House have already deleted the provision in Timta mandating the creation of the Tax Expenditure Account in the annual General Appropriations Act.

They also removed the provisions that require investment-promotion agencies to appear before Congress and ask for budgetary tax subsidy.

These are among the major concerns of business groups.

LP Rep. Maria Leonor GeronaRobredo of Camarines Sur, author of Timta, or House Bill (HB) 2942, said the proposed measure should be passed as it promotes transparency, which the country needs.

HB 2942 seeks to promote transparency and accountability in the grant and administration of tax incentives to business entities, private individuals and corporations.

“There’s no provision in Timta that discourages investment; the proposed law only asks for a transparent system...nothing more, nothing less,” Robredo said. “Even businessmen want transparency besides good governance.”

Robredo also said the Timta is receiving many positive comments from the members of the lower chamber.

She said the House Committee on Ways

and Means will continuously discuss Timta with several stakeholders.

Liberal Party Rep. Jerry Trenas of Iloilo, Centrist Democratic Party Rep. Rufus Rodriguez of Cagayan de Oro and LP Rep. Antonio Rafael del Rosario of Davao del Norte, all members of the Committee on Ways and Means, also backed the passage of Timta.

“The grant of tax incentives to encourage investments and companies to do business in the Philippines has been a sound strategy that our economic managers have employed to bolster our economy, generate employment and to encourage growth in certain key industries,” Treñas said. “However, we must also take into account the present-day context of our economy and of the respective industries benefited by these incentives. There is a need to reassess the efficacy and cost-benefit ratio of these incentives to ensure that the objectives of these incentives are still met by our existing legal framework.”

Rodriguez, coauthor of Timta, meanwhile, said the incentives given

by the government should be monitored with the passage of the measure.

Deputy Majority Leader and National Unity Party Rep. Magtanggol T. Gunigundo of Valenzuela, said “we need a law on transparency, like the Timta, for the Asean integration in December.”

“In the advent of Asean 2015 integration, we want our policies to be consistent and the implementation should have predictable outcomes.

However, we should keep an open mind on the suggestions of taxpayers,” he said.

RFI

Meanwhile, Treñas said the lawmakers should carefully review the recommendation of several government agencies before passing the RFI bill.

“Fiscal incentives rationalization, however, must be done after careful review by the concerned government financial agencies and upon proper consultation with the affected industries. We must ensure that proposed

legislation rationalizing incentives should not adversely affect our ongoing programs that encourage direct investments and the growth of local industries,” he said.

Gunigundo said any rationalization must be predicated on a tax system that is easy to comprehend and comply with.

Party-list Reps. Jonathan dela Cruz of Abakada and Rep. Sherwin Tugna of Cibac also supported the passage of the RFI bill. “I am for the enactment of the bill. It’s about time we rationalize our tax regime if we are to be globally competitive,” de la Cruz said.

Tugna said: “I may support to amend the current incentives to be reasonable, making them a win-win situation for both the government to get revenue from taxes. However, the bill should not dissuade foreign investors and make our country attractive to foreign investors.”

The RFI bill has been facing strong opposition due to its provisions, particularly on the lifting of the tax- and dutyfree incentives of several industries.

“Definitely, we have to hear out these oppositions and study the bases and validity of their positions and arguments with the end in view of harmonizing them with the pending bills. [However] we cannot continue nurturing and spoiling certain industries forever. We should not create a culture of mendicancy where we favor industries, which do not even try to be competitive. The government cannot forever be a nanny to overgrown adults acting like kids,” Party-list Rep. Rodel Batocabe of Ako Bicol said.

Business groups also want assurance from the government that reforms are institutionalized.

“The challenge now for the Aquino administration, and this has been also said by the Management Association of the Philippines in the past, is to institutionalize reforms so the next administration can’t go backward. We need to get something in place and not keep reversing,” American Chamber of Commerce of the Philippines Director David “Ebb” Hincheliffe had said.

With just a year left before the present administration comes to a close, business groups—fearing investment instability because of the possible change in the incentives regime—may find consolation in the fact that time may only permit the passage of just one of two bills. A ranking official of the Department of Trade and Industry (DTI), who is privy to the matter, earlier said the RFI measure may have a better chance of being passed into law, as the DTI is more inclined to give way on it, compared to the Timta.

The DTI would hold greater control in the grant of incentives with the RFI compared to the Timta, which would give the Department of Finance the power to demand the reportorial requirement from enterprises and wield the power to suspend incentives.

Ultimately, the decision to bargain competitiveness in attracting investments in exchange for higher revenue collection—and whether this would be a legacy of the Aquino administration—would depend on how firm the DTI can stand its ground in the months to come.

news@businessmirror.com.ph

The Nation BusinessMirror

SC asked to junk Pcos machines

By Joel R. San Juan & Jovee Marie N. dela Cruz

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PETITION seeking to stop the Commission on Elections (Comelec) from reusing the 81,000 Precinct Count Optical Scan (Pcos) machines for the 2016 elections was filed at the Supreme Court on Tuesday.

In a 46-page petition, the petitioners, led by former Rep. Genn Chiong of Biliran and Ang Kapatiran Party-list led by Norman Cabrera, also sought the nullification of the several provisions of Republic Act 8436, or the automated election system (AES) law that allows the creation of the Comelec Advisory Council and Technical Evaluation Committee with respective corresponding powers.

The petitioners argued that Congress violated Section 2 (1), Article IX-C, of the 1987 Constitution, which prescribed the Comelec’s powers and functions in inserting the said provisions.

Section 2 (1) states that the Comelec shall... “enforce and administer all laws and regulations relative to the conduct of an election, plebiscite, initiative, referendum and recall.”

The petitioners stressed that Sections 8, 9, 10 and 11 of RA 8436 are unconstitutional, as these are in conflict with Article IX-C, Section 2 (1), 1987 Constitution, prescribing the prime task or mandate of the Comelec.

“Sharing the said power with other bodies, whether permanent or ad hoc, transgresses the prime task or mandate of the Comelec under the Constitution, not to mention that the setup undermines its institutional independence,” the petitioners said.

“The mere thought alone that the Comelec is under some kind of supra-entities created in guise of extending assistance to the same is abhorrent,” they argued.

By incorporating those statutory provisions in the AES Law or in creating the Advisory Council and the Technical Evaluation Committee, the petitioners said Congress transgressed Article IX-C, Section 2(1) of the 1987 Constitution, thus, it acted in grave abuse of discretion amounting to lack or excess of jurisdiction.

“Obviously, these legislative creations suffer from the vice of unconstitutionality and must be enjoined, through the extraordinary writ of certiorari or prohibition, from performing their respective functions, less the Comelec’s prime task will unduly be diluted and its institutional independence compromised,” the petitioners said.

Named respondents in the petition were the Senate, House of Repsentatives, Comelec, Comelec Advisory

Council, Comelec Technical Evaluation Committee and the Department of Budget and Management (DBM).

‘Junk deal with Smartmatic’

MEMBERS of the House of Representatives’ Electoral Tribunal (HRET) on Tuesday urged the new Comelec officials to junk with finality the deal between the poll body and Smartmatic.

Party-list Rep. Luzviminda Ilagan of Gabriela said the Comelec should pursue the automated canvassing to ensure transparency in the 2016 national and local elections.

“We hope that the infusion of new blood into the Commission on Elections’ roster of commissioners will tip the Comelec’s previous overly favorable decisions toward its anomalous transactions with Smartmatic. The Comelec should refuse any further dealings with Smartmatic.”

President Aquino has appointed Andres Bautista as new Comelec chairman, along with two new other commissioners—Rowena Guanzon and Sheriff Abas.

Ilagan said that in carrying out the automated elections using Smartmatic’s Pcos machines in 2010 and in 2013, the poll body allowed foreignowned Smartmatic to practically disable all the Pcos’s capabilities that will help make the election process transparent.

“The counting done by the machines became extremely difficult to verify and consequently, its accuracy and integrity placed under question. These were clearly stipulated as requirements for the implementation of the AES law. People’s participation and involvement in the elections were undermined and the demand to make elections clean, honest and transparent was disregarded,” she said.

The Makabayan Bloc, which includes Gabriela, is pushing for the implementation of automated canvassing in the 2016 elections, while allowing manual voting and counting to be conducted at the precinct level.

“Transparent manual voting will provide voters and candidates alike with a verifiable, audited paper trail at the precinct level,” Ilagan said, adding, “We hope that the Comelec, in its commitment to protect the integrity of the elections, will consider this proposed conduct of the 2016 elections.”

Senior Deputy Minority Leader Rep. Neri Colmenares also urged the Comelec to altogether discard the use of Smarmatic Pcos automated system as it violated the democratic tenet of secret voting and public counting and yields sovereign control of the electoral process to Smartmatic.

US Navy littoral combat ship makes first stop at Subic

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By Rene Acosta

LITTORAL combat ship (LCS) of the US Navy docked in Subic Bay, Zambales, on Monday in what was seen as the first proof of the country’s inclusion under the areas in Asia Pacific where the US military is strengthening its presence through the rebalancing of its forces.

USS Fort Worth (LCS 3) docked in the former base of the US Seventh Fleet to resupply and refuel before continuing its routine operations in the areas of operations of the fleet.

The presence LCS in the country was the first since the US announced it will strengthen its presence in the country, and it came while the Philippines and the US were continuously voicing their concerns over China’s continuing reclamation activites on the West Philippine Sea. LCS is a class of relatively small surface vessels intended for operations in the littoral zone (near shore). It was “envisioned to be a networked, agile, stealthy surface combatant capable of defeating antiaccess and asymmetric threats in the littorals.”

Reports said that LCS were put into operation by the US in order to counter the threats and even forces, specifically from China, which are emanating from shallow waters or bases, including those that are based from reefs which China is now reclaiming in the South China Sea for its bigger military use.

The US Embassy said the USS Forth Worth’s docking in Subic was the first stop in the Philippines by the agile ship, which is currently on her maiden 16-month rotational deployment in support of the Indo-AsiaPacific Rebalance.

Fort Worth is the second LCS to deploy to the Seventh Fleet, as part of an initiative to simultaneously deploy up to four LCS in the Indo-AsiaPacific region by 2018.

The third and fourth LCS deployments are planned in 2016, providing a simultaneous presence of two ships in the region.

“While this is a brief visit for Fort Worth, the ship will return to the Philippines later this summer to participate in Cooperation Afloat Readiness and Training [Carat] 2015 with the Republic of Philippines Navy,” said Cmdr. Matthew Kawas of the US Navy.

Carat is an annual, bilateral exercise series with the US Navy, U.S. Marine Corps and the armed forces of nine partner, nations, including, Bangladesh, Brunei, Cambodia, Indonesia, Malaysia, the Philippines, Singapore, Thailand and Timor-Leste.

Fort Worth, which has been based in Singapore, has a crew of 103 personnel.

While deployed, Fort Worth will employ the surface warfare (SUW) mission package, augmenting her 57mm gun and rolling airframe missile launcher with two 30mm guns, two 11-meter rigid-hull inflatable boats, and two six-member maritime security boarding teams.

Enhancing the SUW mission package is the embarked aviation detachment from Helicopter Maritime Squadron (HSM) 35, the Navy's first composite expeditionary helicopter squadron, which consists of one MH-60R Sea Hawk helicopter and one MQ-8B Fire Scout unmanned aircraft system. The Fire Scout complements the MH-60R by extending the HSM-35's range and endurance, enhancing maritime domain awareness.

Editor: Dionisio L. Pelayo • Wednesday, May 6, 2015 A3

Aquino won’t bring up toxic trash reexport in Canada state visit

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By Butch Fernandez

RESIDENT Aquino, who is set to fly for a three-day state visit to Canada on Wednesday, will not convey to Canadian officials concerned environment groups’ appeal for Canada to take back 50 container vans of toxic hospital-trash shipment dumped in the Philippines two years ago.

“No, this will not be taken up,” Communications Secretary Herminio B. Coloma Jr. told the BusinessMirror.

Coloma indicated that the Department of Environment and Natural Resources (DENR), the agency tasked to handle the matter, is no longer pushing to return the toxic trash to the Canadian company that exported the hospital waste that was rotting in container vans parked at the port area, following the seizure of the misdeclared shipment nearly two years ago.

“The DENR is pursuing legal action against the importer, as this is a private

commercial transaction,” Coloma said.

He disclosed that the Aquino administration is now “looking into using the waste material for landfill.” his developed as Mr. Aquino and selected Cabinet officials prepared to fly to Canada and the US on combined economic and diplomatic missions, that will also see President Aquino visiting Filipino communities in the two countries.

Coloma confirmed that Mr. Aquino earlier accepted an invitation from Canadian Governor General David Johnson for a three-day visit to Canada, before flying to Chicago on his way

back to Manila later this week.

President Aquino and Canadian Prime Minister Stephen Harper are set to witness the formal signing of a number of agreements seen to boost people-to-people relations and solidify the ties of the two countries on labor cooperation, development assistance and infrastructure development.

Canada announced last year the designation of the Philippines as a “country of focus” for development assistance, as well as a “priority emerging market” for Canadian overseas trade and investment, Coloma said.

Proenvironment groups, however, voiced serious concerns over threats to public health posed by the misdeclared Canadian trash export, citing reports that “garbage juice is now leaking” from the 50 container vans at the Bureau of Customs compound.

A Change.org online petition for Canada to take back the trash from the Philippines also cited mounting revenue losses from the seized shipment.

“Aside from environmental concerns, economic issues also come into play as the Philippine government has incurred losses on storage and demurrage brought about by the importation of the contraband,” it noted.

Economy

A4 Wednesday, May 6, 2015 • Editors: Vittorio V. Vitug and Max V. de Leon

BusinessMirror

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Hydro lures more bidders

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he Department of Energy (DOE), through the Open and Competitive Selection Process (OCSP), received a total of 31 bids for 14 potential hydropower sites found across the archipelago and eight bids for two geothermal project prospects.

“Yes, we’re happy with the turnout, 31 bids for hydropower projects and eight bidders for geothermal power projects,” Renewable Energy Management Bureau Director Mario Marasigan said on Monday at the sidelines of the second bidding process for the OCSP sites held at the DOE Head Office in Bonifacio Global City, Taguig.

Marasigan said the hydro sites reached a bid of 80 percent, while the geothermal sites had bids by 50 percent.

He noted the next step for the DOE will be the evaluation process for the bids.

Marasigan stressed that the development cost for the project amounts to $2.5 million to $3 million per megawatt for the two types of resources.

However, he said hydro projects are easier to build than geothermal projects.

For Area 1, which is called the Mandongan 1 hydropower project, four companies have submitted bids, namely Pachydro Energy Inc., Clean and Green Energy Solutions, FGS Renewable Energy Inc. and Alternergy Hydro Partners Corp.

Mandongan 2 hydropower project had attracted two participants, FGS Renew-

able Energy Inc. and Alternergy Hydro Partners Corp.

Area 3 in Solsona was bid for by FGS Renewable Energy Inc. and Alternergy Partners Corp.

Area 4, the Binongan-Tineg hydro project, had received bids from FGS Renewable Energy Inc. and First Gen Mindanao Hydro-Power Corp.

Both Areas 5 and 6, namely Binalbagan and Pagbahan, had no bidders.

The Ilog hydropower project, or Area 7, had received bid proposals from TransAsia Oil and Energy Development Corp.

(EDC), FGS Renewable Energy Inc. and Almana Power Corp.

Southeast Asia and Almana Power Corp. submitted bids for Area 8, Binalbagan 1 hydropower project.

Almana Power Corp., solely bid for Areas 9 and 10, namely Binalbagan and Binulog.

OCSP failed to garner bids for Area 11.

For the Tubig hydropower project, or Area 12, Vivant Corp., FGS Renewable Energy Inc., Almana Power Corp., and Iraya Energy and Renagmec Hydro-Power Corp. submitted bid proposals.

Area 13, or the Buhid hydropower project, got three bidders, namely Vivant Corp., FGS Renewable Energy Inc. and Almana Power Corp.

Area 14, the Butong Falls hydropower project, was solely bid for by Clean and Green Energy Solutions.

First Gen Mindanao Hydro Power Corp. had solely submitted a bid for Area 15, or Catilan river.

Area 16, or Cagayan 1N, had bid proposals from Southeast Asia Mining and Power Corp., Markhan Resources Corp. and First Gen Mindanao Hydro Power Corp.

Agus 3, which was offered as the 17th site, had been bid for by Mindanao Energy Corp.

For the offered geothermal sites, Area 2, or Southern Leyte geothermal project, had attracted Repower Energy Development Corp., Cabalian Co. Inc. and Aboitiz Renewables Inc. The three companies submitted bids for the project.

Amacan Geothermal, offered as Area 3, received five bids from Repower Energy Development Corp., APC Energy Resources Inc., Biliran Geothermal Inc., EDC and Emerging Power Inc. Areas 1 and 4, namely AcubanItugon and Balut Island offered under geothermal sites, had no bidders.

The areas which had not been bid out will be offered through direct negotiations with the DOE. PNA

Fresh catch

Two fishermen carry a container of newly caught fish to be sold along the shoreline of Freedom Island in Parañaque City on Sunday. PNA

No ‘suitable’ replacement yet for DOE’s Petilla

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By Lenie Lectura

arlos Jericho L. Petilla remains the secretary of the Department of Energy (DOE) until Malacañang finds a “suitable” replacement.

In a text message reply after the meeting between Petilla and President Aquino on Monday afternoon, Petilla said he agreed to remain in his post because he wanted to give the President more time to decide on his replacement.

Last week Petilla announced he submitted his irrevocable resignation letter to the President in March. His resignation was supposed to take effect on April 30.

Petilla recommended DOE Undersecretary Zenaida Monsada as officer in charge of the agency.

“Yes, my stay is extended until he finds an appropriate replacement,” Petilla said.

When asked how long will he delay the implementation of his resignation, Petilla said there were no dates finalized. “No dates for now but we will continue this matter and other energy concerns when he comes back from the trip to US.” The President is scheduled to visit Canada and US from May 6 to 9.

There are two possible candidates. First, is former Energy Secretary Raphael “Popo” Lotilla and second is current National Transmission Corp.

President Roland Bacani.

Lotilla served the agency from March 2005 to July 2007. Prior to his

appointment as energy secretary, Lotilla was the president of the Power Sector Assets and Liabilities Management Corp. (PSALM). He also briefly served as PSALM COO before he became president. He also served the National Economic and Development Authority from January 1996 to January 2004 as undersecretary.

Lotilla did not categorically say yes or no if he was interested to replace Petilla.

Bacani, in a separate replay, said he would “seek the guidance of my Boss up there” for any sign. “Please, pray for me,” he added.

Petilla, in his resignation letter, cited “personal and family reasons,” as to why he wanted to quit his job. He, however, did not deny that he is considering seeking for a higher office in 2016.

“I am keeping my options open. What position, if you ask me, I can never say until the last minute that I have made up my mind,” he said.

Petilla had told the President as early as last year that he wants to pursue his personal plans and that his desire to resign from his post was delayed because he had to deal with so many issues in the power sector.

“I couldn’t because there so many issues to deal with. There was the Meralco [Manila Electric Co.] rate hike, power restoration after [Supertyphoon] Yolanda, and the power situation for the summer of 2015,” he said.

In December of 2013, Petilla resigned after he failed to make good on his promise to energize the areas in the Visayas that were badly hit by a tropical storm. President Aquino did not accept his resignation then.

EDC eyes raising P5 billion for steam field explorations

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OPEZ-led Energy Development Corp. (EDC) is looking at raising P5 billion to finance the expansion of its geothermal assets to further cement its footprint in the power sector.

At the company’s stockholders’ meeting on Tuesday, EDC Vice President for Corporate Finance Erwin Avante said the P5 billion will finance the steam field component of Bacon-Monito (BacMan) geothermal power plants in Bicol. The existing power facility consists of Unit 1, 120 megawatts (MW) and Unit 2, 20 MW. “The P5 billion that we’re looking at is needed to finance the steam field part of our geothermal growth which includes BacMan 3, 4 and Mindanao 3. For the power-plant component, it depends on the size of the megawatt but, ideally, we will finance those on 70-percent debt basis,” Avante said.

EDC plans to put up three more units. The plan, for now, is to construct Unit3, with a capacity of 30 MW. Unit 4, Avante added, could generate a capacity anywhere between 17 MW and 20 MW. Construction for Unit 4 is seen next year.

EDC President Richard Tantoco said a Notice to Proceed for the construction of BacMan Unit 3 will be issued to its preferred contractor within the third quarter of this year.

There is also a plan to construct a fifth BacMan unit in the latter part of 2016 or early 2017.

briefs airport exec lauds 33 honest miaa personnel

A top airport official underscored the importance of honesty in the work force during the commendation ceremony of 33 exemplary employees of the Manila International Airport Authority (Miaa) on Monday.

Ninoy Aquino International Airport Terminal 2 Manager Enrico Gonzales cited the Miaa personnel who have made the “big difference” in terms of providing passengers with the excellent experience they seek from an airport. “It is always refreshing to honor individuals who have exhibited acts of honesty and trustworthiness but these are exceptional cases,” Gonzales said.

“For the rest of us, there are other laudable acts that can be done on a daily basis,” he added.

Gonzales referred to common acts of courtesy such as smiling and attending immediately to the needs of passengers. PNA

“We are looking at a larger capacity for BacMan 4 and much bigger for BacMan 5. We will start BacMan 3 this year,” Avante said.

Mindanao 3, meanwhile, is part of the geothermal power complex in North Cotabato. EDC plans to generate 50 MW of capacity from Unit 3.

EDC is the largest producer of geothermal energy in the Philippines. For this year, the company expects a “modest jump” in its revenue from P30.9 billion registered in 2014. “For our net income, it could be flat or slightly up, depending on how we manage the costs,” Avante said.

EDC’s recurring net income stood at P9.2 billion last year. When pressed for target numbers, Tantoco said this year’s net income could be “Probably better but modest.” “It could be a muted year,” he added.

EDC is now realizing the benefits from investments made for the BacMan plant rehabilitation works, the 150-MW Burgos wind power and the 49.4-MW Nasulo geothermal projects.

Last year the Bacman plant accounted for more than half of the revenue increase with a P2.8-billion contribution. Revenue from the Nasulo power plant in Negros Oriental stood at P700 million and P200 million from the Burgos wind farm.

“For full-year 2015 revenues for Burgos would be less than P2 billion. Assuming unforeseen events, BacMan revenues could hit P4.5 billion,” Avante added. Lenie Lectura

national cancer authority proposed

Noting that cancer is the third leading cause of death in the Philippines, a lawmaker has proposed an organized and sustained cancer-control program through the creation of a National Cancer Care, Research, and Development Authority.

“The Department of Health identifies cancer as the third leading cause of death in the country, afflicting 189 per 100,000 Filipinos. Cancer kills 103 Filipinos daily or four die per hour and one out of five is expected to acquire cancer up to the age of 75,” ANG NARS Party-list Rep. Leah S. Paquiz said.

Paquiz is the author of House Bill 5321 which mandates the creation of the said body, to be referred to as the National Cancer Authority, “providing for its powers, structure and for other purposes.”The bill has been referred for consideration to the House Committee on Government Reorganization (as lead panel) and the Committee on Health.

She noted a report by the Philippine Society of Medical Oncology in 2012 which revealed the Philippines at the center of the fight against breast cancer in Asia, with the highest incidence of breast cancer in the continent. PNA

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DTI hastens drive on EU GSP+ utilization

DBM okays release of P1.2B for elderly indigents

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briefs 25k may lose jobs with k to 12 implementation About 25,000 teaching and nonteaching personnel are expected to be displaced by the full implementation of the K to 12 Program next year, a party-list lawmaker said.

Party-list Rep. Terry Ridon of Kabataan, citing the report submitted by the government’s education cluster to the House Committee on Higher and Technical Education, said that 13,634 teaching personnel (2,794 permanent and 10,840 nonpermanent) and 11,456 nonteaching personnel (5,702 permanent and 5,754 nonpermanent) will lose their jobs come 2016 due to the “reduction in college enrollment.”

The government-education cluster includes the Department of Education, Commission on Higher Education, Technical Education and Skills Development Authority and the Department of Labor and Employment.

Ridon, a member of the House Committee on Higher and Technical Education, said that the report also indicated that the displacement of the 25,000 college personnel “may adversely affect the operational viability of various higher-education institutions.” Jovee Marie dela Cruz

lawmaker defends purchase of ‘overpriced’ pnp patrol jeeps A lawmaker on Tuesday debunked allegations of overpricing on the purchase of 210 units of 4x4 medium patrol jeeps for the National Police (PNP), saying the deal was done under strict compliance with Republic Act 9184, also known as the Government Procurement Reform Act. Iloilo Rep. Jerry Trenas said groups and personalities, who were raising a howl on the PNP’s latest acquisition of the medium patrol jeeps, were obviously ignorant of the added costs required to customize 4x4 vehicles and turn them into all-purpose personnel carriers and mobile patrol vehicles.

The Visayan solon noted that the alleged overpricing was based on the comparison of the prices of the vehicle at bidding with that of the price posted in the web site of the KIA but this is entirely misplaced because the modifications required to make these vehicles field worthy entails additional cost. PNA

By Estrella Torres

he Department of Budget and Management (DBM) has approved the release of P1.2billion fund assistance for elderly indigents, as part of the government’s measures to achieve inclusive growth.

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he Department of Trade and Industry (DTI) targets more small and medium enterprises (SMEs) to utilize the Generalized System of Preferences Plus (GSP+) granted by the European Union (EU) to the Philippines.

The trade department said on Tuesday that some 100 SMEs in Laguna participated in the SME Roving Academy (SMERA) Program, in which the benefit of the EU GSP+ was discussed to the SMEs. Only Christmas last year, the Philippines was able to take advantage of the EU GSP+, in which 6,274 products, or about two-thirds of the country’s exports, entering the EU market are entitled to zero duty.

Among the notable local products that would benefit under the EU GSP+ are coconut and marine products, processed fruit, prepared food, animal and vegetable fats and oils, textiles, garments, headwear, footwear, furniture, umbrellas and chemicals.

“This would spell bright prospects for the Philippines and the Calabarzon region, as well, since under the scheme, our SMEs will be able to export virtually everything, except prohibited products, with no tariffs to be imposed,” DTI Calabarzon Regional Director Marilou Quinco-Toledo said.

Aside from DTI Laguna, the department’s office in Region 12 also implemented the SMERA program. Over 130 participants joined the event, including handloom and T’nalak weavers, local market vendors, chambers of arts and crafts, furniture- shop owners, restaurant, eatery and bakeshop operators, and fish-cage operators.

TheSMERAisacontinuouslearningprogramfor the development of SMEs to become competitive in the domestic and international markets. This is a front-line service of the DTI that is being conducted at the provincial and municipal level to cater to more entrepreneurs in the areas served. PNA

Wednesday, May 6, 2015 A5

Green plumbing technology

Sen. Cynthia A. Villar receives a certificate of appreciation from the Philippine Society of Plumbing Engineers Inc. (PSPE) National President Jason Magos during the PSPE’s 11th anniversary celebration and national convention at the Manila Grand Opera Hotel in Santa Cruz, Manila. Villar was the keynote and guest speaker during the event with the theme, “Plumbing Engineers Moving Towards Sustainable Green Plumbing Technology.” She commended the group for continued efforts in finding new systems and technologies for a sustainable green technology in the industry that will help protect the environment. Also in the photo (from left) are Virgilio D. Simbulan; Alberto Cabael, vice president for Technical Affairs; Abner Pahilanga, vice president for Education; Alberto Azarcon Jr., immediate past president, and Ricardo D. Taytay, national treasurer. Roy Domingo

BOI approves Typhoon Yolanda guidelines for housing developers

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he Board of Investments (BOI) has approved the guidelines of developers in building socialized-housing projects in the areas hit by Supertyphoon Yolanda (international code name Haiyan) in the Eastern Visayas region.

The Typhoon Yolanda Guidelines of the BOI was published and has taken effect on April 23.

Under the BOI’s existing rules, the registered housing developers have to allocate an equivalent of 20 percent of the project cost of their registered plans or parallel area specified under the law, for the socialized housing.

The recently accredited guidelines grant registered housing developers additional modes to conform to the BOI socialized-housing requirement (SHR) and, likewise, supporting the rehabilitation endeavors of the government based on the principle of “build-back-better.”

The principle aims for long-term sustainable efforts to reduce susceptibility and fortify abilities of communities in coping with future disasters.

Registered developers may donate either construction materials or land but only in specific areas recognized by the Comprehensive Rehabilitation and Recovery Plan (CRRP), also known as the Yolanda Rehabilitation Master Plan.

The CRRP specified the areas and the specific government intervention to rehabilitate the communities hit by Yolanda in different cities and provinces, including Leyte, Capiz, Tacloban City, Iloilo and Eastern Samar. The plan concentrated on four areas of rehabilitation, which are livelihood, resettlement, social services and infrastructure.

Timely release of budget

The National Economic and Development Authority (Neda), meanwhile, said it intends to focus on the timely release of the budget for the reconstruction and rehabilitation of Yolanda-hit areas.

With the transfer of the Presidential Assistant for Rehabilitation and Recovery to the Neda, the economic oversight agency intends to work closely with the budget department to ensure that fund disbursements do not impede project implementation.

“We shall focus on the timely release of the budget, for projects included in the CRRP,” Economic Planning Secretary and Neda Director General Arsenio M. Balisacan said in a news statement.

“For this, we shall be working closely with the Department of Budget and Management to ensure that the requisites for responsible public financial management do not impede the effi-

cient implementation of urgently needed rehabilitation projects,” he added.

The Neda said the reconstruction and rehabilitation projects in the Yolanda corridor will be overseen by a project monitoring office (PMO) within the Neda, under the Regional Development Office, headed by Deputy Director General Margarita R. Songco.

The Neda said the PMO will use the existing Regional Project Monitoring and Evaluation System in monitoring the status and progress of Yolanda-related projects, programs and activities (PPAs). This will serve as the basis for regularly reporting on the progress of work.

The agency also assured that it will regularly consult with local government units in the disaster-affected regions to ensure that PPAs are responsive to local needs.

It will also work with development partners from the private sector, civil society and the international development community to rebuild the economies in the affected areas and restore people’s jobs and livelihood.

“We are determined to build on the gains and learn from the shortcomings.

Always our focus shall be to hasten the recovery process by eliminating administrative and policy bottlenecks in the implementation of priority PPAs,” Balisacan said. PNA, Cai U. Ordinario

PNR indefinitely suspends operations

By Lorenz S. Marasigan

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NDERINVESTMENT, a train expert and a government official agreed, ultimately caused the indefinite suspension of the Philippine National Railways’s (PNR) services on Tuesday.

Diosdado N. Silva, the train line’s assistant general manager, explained on late Monday that PNR services were halted so that the government can conduct an exhaustive inspection of its train tracks to ensure the safety of its passengers and trains.

This, he said, is in the wake of the recent derailment of the oldest at grade railway system in the Philippines near its Nichols Station in Pasay last week that resulted in the injury of more than 50 passengers.

“Operations of the commuter line shall resume as soon as extensive inspections and assessments have been made and the integrity of the rail tracks has been certified

safe and sound for its trains to pass and passenger safety is assured,” Silva added.

A team from Cologne-based technical and safety provider TÜV Rheinland Group is now conducting the review of the railway line’s state.

“Initial findings showed that there were missing angle bars and rail clips that support the rail joints. Without those components, the joints will be weakend,” Paul de Quiros, the staterun company’s spokesman, said in an interview on Tuesday.

The rail parts, he said, might have been vandalized—or in simpler terms—stolen. The PNR’s tracks are found bare near areas populated by illegal settlers.

“We are fast-tracking the process. There are about 60,000 passengers using the PNR daily. They will more likely ride alternative transport systems such as buses and jeepneys,” de Quiros said.

Silva, for his part, appealed

to commuters to bear with the temporar y inconvenience as it conducts the necessary precautionary measures.

“Despite PNR’s limited resources, we have been doing all the necessary procedures to preclude any untoward incident and to ensure the well-being of its commuters,” he said, referring to the government’s lack of investment in the railway line.

The state-run company sought for an P11-billion capital this year but the national government decided to approve a P2.2-billion budget for 2015. This is, by far, the largest allocation for the railway line in this administration.

“This is the only time that our budget was close to P2 billion. We will maximize it by improving our current fleet,” the spokesman said.

From 78 trips a day, the operations of the PNR declined to 52 daily services, all because the line’s fleet has also diminished by half.

Budget Secretary Florencio B. Abad said the funds will be released to the Department of Social Welfare and Development (DSWD) for the Social Pension of Indigent Senior Citizens.

The expanded senior citizens law allows elderly indigents to receive additional monthly stipend worth P500 under the Social Pension for Indigent Senior Citizens. “We crafted the 2015 budget to prioritize the poor and the vulnerable, including indigent senior citizens. This release will allow us to address the basic needs of our elderly indigents, who do not otherwise have the resources to support themselves,” Abad said in a news statement released on Tuesday.

He added that the indigent senior citizens law defines “any elderly who is frail, sickly or with disability, and without pension or permanent source of income, compensation or financial assistance from his/her relatives as determined by the DSWD.” Abad said the P1.2-billion fund will benefit some 200,000 elderly indigents 65 years old and above.

The fund will come from the DSWD’s P2015 budget worth P5.96 billion for the Social Pension for Indigent Senior Citizens.

The entire amount is intended to benefit some 939,609 indigent senior citizen this year. The fund request of the DSWD is based on the documents submitted to the DBM that include a detailed Financial Plan, a Monthly Disbursement Program, a Physical Plan, and other documentary requirements.

Opinion BusinessMirror

A6 Wednesday, May 6, 2015

editorial

Amending the economic provisions of the Constitution

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ne of the most welcome pieces of news that circulated late last week is that of Speaker Feliciano Belmonte Jr. calling on his colleagues in the House of Representatives to fast-track deliberations on amendments to the economic provisions of the Constitution. We thought the good Speaker has forgotten all about such amendments given Malacañang’s expression of lack of interest in them. But the Speaker is obviously unimpressed by the Palace’s stance. And for good reason. If we do not remove these restrictive provisions, we might, as well, dissipate any notion of development for our country’s economy.

Consider the data shown below.

Foreign Direct Investment, 2013 (million dollars) Brunei 908.4 Cambodia 1,274.9 Indonesia 18,443.8 Lao PDR 426.7 Malaysia 12,297.4

Myanmar Philippines Singapore Thailand Vietnam

2,620.9 3,859.8 60,644.9 12,999.8 8,900.0

Of the five original members of the Association of Southeast Asian Nations (Asean)—not counting Brunei Darussalam, which does not need foreign direct investment (FDI)—the Philippines received the smallest amount of FDI. The Philippines is superior only to newcomers Cambodia, Lao PDR and Myanmar in receipts of FDI. At the rate we are going, we shall even fall behind these countries in another four or five years in attracting FDI. Talk about employment creation, poverty eradication, or improvement in standards of living, these will not come about without investment, including foreign investment.

Perhaps, it is understandable why these restrictions were laid down in the Constitution when they were. In the 1980s the flames of nationalism were still raging, stoked by the idea that the country remained an object of economic exploitation despite years of political independence.

The thoughts undergirding that idea have now been shown to be false: There is not all that much foreign capital available for mobilization to begin with, and it is not anywhere near to jumping on us to exploit us the moment we allow its entry into our economy; and if we push away any prospective foreign investment, it is just, as well, for our neighbors, who are falling over themselves to attract foreign investment with all kinds of incentives.

As reported, Belmonte said that the resolution on amendments should be passed this year so a plebiscite for Charter change could be incorporated in the 2016 national and local elections. The resolution will be sponsored in the Senate by Sen. Ralph Recto. The amendments will be approved by both chambers of Congress voting separately, with a three-fourths vote required from each of them.

If the envisioned amendments are passed by Congress and approved by the people in a plebiscite, we have no doubt in our mind that FDI to the Philippines will increase four- or fivefold in a few years after approval. This should give a tremendous boost to the development of our economy.

We give our unqualified support to this effort of Belmonte to get the economic provisions of our Constitution amended.

Letters from members Susie G. Bugante

All About Social Security

A

number of Social Security System (SSS) members have written to inquire about various concerns, and I would like to share some of them here for the information of other members.

Mr. E. would like to know why his application for salary-loan renewal submitted in January 2015 was rejected, when he had already paid in advance more than 50 percent of the loan that he took out in June 2014 and started paying in October of the same year.

Answer: While the guidelines allow the renewal of the salary loan upon payment of 50 percent of the principal amount plus interest, the payment must be in accordance with the schedule of amortization payment. The guidelines provide that salary loans must be paid in 24 monthly installments, thus, the 50 percent must be paid in 12 months.

The 12-month period in this case will fall in September 2015, which is also the renewal period.

Another member, Mr. G., wrote to ask why the P700 loan he took out in 1981 had ballooned to P10,000, which was deducted from his disability benefits.

Answer: Accrued penalties and interests are the main reasons that outstanding loan balances could balloon to more than 10 times the original loan amounts depending on how long they have remained unpaid. It is regrettable that members who have outstanding loan balances at the time of applying for terminal benefits (retirement, total disability or death in the case of member-beneficiaries) will have to settle their liabilities first. In the case of Mr. G., instead of enjoying his benefits immediately, the outstanding amount was deducted

from his benefit proceeds. It is best, therefore, that loans are paid on time or within the payment period.

To rec ap t he sa l a r y-loa n guidelines, it is noteworthy to mention that: 1. A one-month salary loan is equivalent to the average of the member-borrower’s latest posted 12 monthly salary credits (MSCs), or amount applied for, whichever is lower.

2. A two-month salary loan is equivalent to twice the average of the member-borrower’s latest posted 12 MSCs, rounded to the next higher monthly salary credit, or amount applied for, whichever is lower.

3. The net amount of the loan shall be the difference between the approved loan amount and all outstanding balance of short-term member loans.

payment shall be applied to the outstanding principal balance. n Loan amortization not remitted on due date shall bear a penalty of 1 percent per month until the loan is fully paid.

Interest and penalty

For more information about the SSS and its programs, call our 24-hour call center at (632) 920-6446 to 55, Monday to Friday, or send an e-mail to member_relations@sss.gov.ph.

Susie G. Bugante is the vice president for public affairs and special events of the Social Security System. Send comments about this column to susiebugante.bmirror@gmail.com.

The loan shall be charged an interest rate of 10 percent per annum based on diminishing principal balance and shall be amortized over a period of 24 months. n Interest of 10 percent shall continue to be charged on the outstanding principal balance until fully paid. n Any excess in the amortization n

Service fee

n A service fee of 1 percent of the loan amount shall be charged and deducted from the proceeds of the loan.

Loan renewal

n Renewal shall be allowed after payment of at least 50 percent of the original principal amount and at least 50 percent of the term has lapsed. n Proceeds of renewal loan is any amount greater than or equal to zero as long as the outstanding balance on the previous loan is deducted.

What’s a Russian propagandist doing in Brooklyn?

Leonid Bershidsky

BLOOMBERG VIEW

T

here’s a start-up in New York that I’m not sure I want to see succeed, even though it’s based on a sound idea. It’s called Babo, and allows citizen journalists to send videos from their smartphones to news organizations and get paid for it.

Its founder, Ashot Gabrelyanov, 26, is the son of Aram Gabrelyanov, who aspired to be Russia’s Rupert Murdoch until he put his tabloid empire at the service of President Vladimir Putin’s propaganda machine.

Gabrelyanov senior’s company, News Media, is 50 percent owned by the media holding of Yury Kovalchuk and Gennady Timchenko, two of Putin’s billionaire friends who are now the target of US sanctions imposed in response to Russia’s depredations in Ukraine.

Ashot learned the business from his father. In 2009 Gabrelyanov Jr. started the tabloid news site Lifenews.ru, and in 2013, a noxious cable channel grew out of it. The ambition

was to propel News Media from crime reporting and paparazzi scoops into the realm of serious news, and Lifenews looks slick and professional.

You’ll never hear criticism of Putin on it, and its slanted coverage of the Ukraine crisis has made it the most hated news outlet in Kiev, resulting in the persistent harassment of its reporters there.

“We cover everything, but we make a mass product, and the mass audience votes for Putin,” Ashot explained in a 2013 interview. “We cannot go against the audience’s opinion.”

Last fall, Ashot quit his father’s company to try to make a success of Babo. The app started as a Lifenews

project, and Gabrelyanov says the channel bought 1,000 amateur videos through it last year. News Media, however, didn’t want to commercialize the platform, and Ashot bought it from the company. Now, Gabrelyanov says, he’s marketing Babo to news organizations that want usergenerated content. An editor could even use geolocation to commission a video from Babo users close to, say, the scene of a major crash.

It’s not a bad idea, though it’s not particularly original. A company called Rawporter, based on the same principle, attracted venture funding and ran its consumer apps for two years before selling the platform.

Other citizen journalism platforms, such as Meporter and OpenWatch, center on self-publishing, not on selling content to professionals. Clearly, TV stations and news sites want exclusive footage fast.

Ashot is now promoting his app in New York, where he moved in January. He lives in Williamsburg, Brooklyn, and goes to rooftop parties, though he “doesn’t like all the hipsters,” as he recently told Mashable.

Meanwhile, Gabrelyanov senior keeps doing his patriotic duty for

Putin. On the Lifenews web site on Tuesday, the top story was “Donetsk People’s Republic’s Militia Prevents Takeover of Shyrokine and Horlivka,” two Ukrainian towns that have recently endured increased shelling by the pro-Russian militants in clear violation of the truce now in force in Eastern Ukraine.

Technically, there’s nothing wrong with the setup: the Gabrelyanovs aren’t under sanctions, and there’s no legal reason that US news organizations shouldn’t buy into Babo. The app’s pedigree shouldn’t matter. After all, a lot of technology on the Internet grew out of porn sites.

There is something distasteful, however, about a service used by Lifenews and the state-owned Russian propaganda outlet RT hitting the US market. After all, Gabrelyanov could have tried marketing his app to Russian news outlets—if they hadn’t declined in recent years, squeezed by Putin’s government to clear the way for Lifenews-style propaganda. My problem with Babo and its young, good-looking, charismatic founder boils down to my belief in karma, or perhaps just to squeamishness.

Opinion BusinessMirror

opinion@businessmirror.com.ph

Wednesday, May 6, 2015

A7

Recall election in Puerto Capital regime for insurance companies in the PHL Princesa bears watching

The Insurance Act would subsequently be replaced by the Insurance Code, with the repeal of Act 2427 by PD 612, dated December 18, 1974, otherwise known as the Insurance Code. Under Section 188 of the Insurance Code, as amended

by PD 1455 (June 11, 1978), a domestic insurance company shall be “possessed of a paid-up capital stock equal to at least P5 million.”

The law provided for a staggered increase as follows: P3 million by December 31, 1978; P4 million by December 31, 1979; and P5 million by December 31, 1980. Once again, the secretary of finance was authorized, upon recommendation of the insurance commissioner, to increase the minimum PUC stock to “assure the safety of the interests of the policyholders and the public.”

Under Department Order (DO) 116-93, dated December 7, 1993, the minimum PUC for nonlife insurance companies was increased to P50 million and for life insurance companies, a minimum PUC

and surplus of P50 million.

Exercising, once again, the powers granted under PD 612, or the Insurance Code, Secretary of Finance Margarito B. Teves, issued DO 27-06 on September 1, 2006, directing the graduated increase in capitalization requirements of all insurance companies. For domestic insurance companies, the PUC required was increased as follows: P50 million by December 31, 2006; P75 million by December 31, 2007; P100 million by December 31, 2008; P125 million by December 31, 2009; P175 million by December 31, 2010; and P250 million by December 31, 2011. DO 27-06 also imposed the minimum statutory net worth culminating to P500 million by December 31, 2011.

The issuance of DO 27-06 would be challenged in court, via a Petition for Certiorari and Prohibition, on the ground of unconstitutionality for being violative of due process and equal protection. The Court of Appeals dismissed the challenge on July 20, 2007 (Covenant Assurance Co. Inc. et al. v. Teves et al., CA G.R. SP No. 97041) and affirmed the constitutionality of DO 27-06.

It was affirmed by the Supreme Court in Minute Resolutions (G.R. 181131) dated September 8, 2008 and December 15, 2008. On June 1, 2012, DO 15-2012 would be issued by Finance Secretary Cesar V. Purisima further increasing the PUC requirement. This again would be challenged before a lower court (Security Pacific Assurance Corp. et al. v. Purisima, et al., Civil Case Q-1271404, QC, RTC). A writ of preliminary injunction would be issued by Branch 80 of Regional Trial Court in Quezon City against DO 15-2012 in an order dated December 5, 2012.

The case, however, will be rendered

moot with the passage of Republic Act (RA) 10607.

Almost simultaneous with the capital build-up requirement, the Insurance Commission directed, for the first time, the adoption of risk-based capital framework (MC 6-2006 and 7-2006) for all insurance companies. Eventually, MC 10-2006 was issued providing a “Consolidated Compliance Framework” and directing that the fixed capitalization requirement under DO 27-96 may be suspended on a year-to-year basis with respect to a particular insurance company should it comply with the prescribed RBC hurdle rate.

The PUC requirement under PD 1455 in 1978 would only be revised by law under RA 10607 on August 15, 2013. Under RA 10607, “new” domestic insurance companies should be “possessed of a paid-up capital equal to at least P1 billion. However, for those already doing business, meaning those already existing, the capital regime shifted from the PUC requirement to the net worth method. Thus, the following net worth was required: by June 30, 2013, P250,000,000; by December 31, 2016, P550,000,000; by December 31, 2019, P900,000,000; and by December 31, 2022, P1,300,000,000.

Pursuant to Section 194, the net worth shall consist of: PUC; retained earnings; unimpaired surplus; and revaluation of assets.

The capital structure required for new companies and the net worth required for existing companies, may be reviewed every two years, upon order of the President.

Trade Representative says it has held about 1,700 meetings on TPP with lawmakers and their staffs. It provides classified chapter-by-chapter summaries. It has published online its negotiating objectives and an outline of what’s been agreed to so far.

At any rate, the complete text of the deal will be made public before it is voted on—if Congress passes a bill giving President Barack Obama the authority he needs to negotiate. This so-called fast-track measure, which the Senate could take up as early as this week, directs the president to

give Congress 60 days notice before signing an agreement. At that point, he must publish the accord online.

Congress can’t vote on it for at least another 30 days.

A couple of years ago, it was a valid argument that the Obama administration was being excessively secretive about the TPP. That is no longer so. Now, the secrecy debate is drowning out any discussion of how the deal plays to US strengths by opening doors to its flourishing agricultural and service sectors. The agreement would make it easier for

US companies to compete abroad by limiting government subsidies to state-owned enterprises. No less important, it would bring participating countries closer to US environmental and labor standards.

In human terms, trade does create winners and losers, the latter group including those whose manufacturing jobs get shipped overseas. Trade’s victims deserve public assistance, retraining and education as the economy adjusts. They also deserve a more honest debate over the real costs and benefits of the TPP. Bloomberg News

Dennis B. Funa

Ernesto M. Hilario

ABOUT TOWN

T

his Friday, May 8, a recall election will be held in Puerto Princesa with incumbent Mayor Lucilo Bayron and former Mayor Edward Hagedorn contesting the top elective position in the city.

Rodrigo Saucelo appeared as our resource person at last Saturday’s media forum at Annabel’s and asked media to monitor the conduct of this political exercise as the Commission on Elections (Comelec) has altered the rules regarding ballot boxes.

Election rules stipulate that the insides of ballot boxes should be secured with three padlocks. But the Comelec en banc, consisting of only four commissioners at present, said the ballot boxes can be secured with other means than metal padlocks, such as cable ties (used by police as alternative handcuffs). This, Saucelo said, raises the very real possibility that the contents of the ballot boxes in this recall election can be tampered with, or that ballot switching can easily take place.

Apart from this, Saucelo asked why the chief of police of Puerto Princesa was suddenly relieved and replaced with a police official who had been accused of extortion and torture in his previous postings in Manila.

Saucelo used to be the spokesman of Hagedorn, but has now allied himself with Bayron. He, along with Wilfredo Rama and Antonio Lagrada, recently filed complaint for plunder, violation of Section 3(e) of Republic Act (RA) 3019 and malversation through falsification of public documents against Hagedorn and several other former city officials before the Office of the Ombudsman for alleged illegal reimbursement of P65 million from the city’s Treasury fund.

But Hagedorn’s camp insists that the reimbursements were warranted as they were used for loan assistance, miscellaneous expenses of the City Mayor’s Office, advertisement or promotion of the underground river, maintenance and other operating expense, purchase of electric vehicles and other operating costs.

The Bayron camp, meanwhile, has also raised questions about the validity of the recall election itself.

The upcoming recall election was preceded by a recall petition that the Bayron camp claimed was railroaded and riddled with anomalies.

According to Bayron, the city’s election officer terminated the period of verification to ascertain the legitimacy of the signatories to the recall petition filed against him, despite thousands of signatures yet to be examined and verified.

Bayron said out of the 35,731 signatures contained in the petition, only 32,322 had been examined and verified, with a total of 3,409 signatures yet to be validated, but the election officer assigned to this petition abruptly ended the verification process without offering any justification at all.

Bayron insisted that the recall petition contained no less than 14,000 forged signatures and 7,000 multiple entries, as well as the names of dead people. Thus, it should have been promptly thrown out by the city election officer.

The incumbent mayor claims credit

for putting Puerto Princesa’s finances back in order after being in the red for many years. He says he has also taken concrete steps to address poverty, and helped poor but deserving students with scholarships and financial assistance.

Apart from this, Bayron also pointed out that, it is not true that, under his watch, the tourist industry has waned. In fact, he said, an alltime high of 740,272 tourists visited Puerto Princesa in 2014 under his administration. In his first seven months in office alone, he said, tourist arrivals surpassed by more than 12,000 the figures posted during the same period under his predecessor.

Water-rate issue still simmers

WE reported last week that Maynilad Water Services Inc. has demanded payment from the government of P3.44 billion in losses from foregone revenues it incurred since the 2013 rate-rebasing period plus another P208 million each month since January.

According to Maynilad executives, the company is amenable to withdrawing a second arbitration complaint with the Singapore-based International Chamber of Commerce (ICC) as soon as the Manila Waterworks and Sewerage System (MWSS) carries out the rate adjustment as ordered by the ICC in its December 29 ruling, in light of a recent assurance by Finance Secretary Cesar V. Purisima that the Philippine government would abide by its financial obligation to the water concessionaire, as stipulated in the state’s Letter of Undertaking or sovereign guarantee to its contractor.

But things took an unexpected turn after the ICC handed out a different decision on April 21 favoring MWSS over the other water concessionaire, Manila Water Corp. (MWC) in its rate-adjustment case, and MWSS flouted the ICC anew in fully implementing the decision on the MWC case right away but selectively enforcing the earlier one on Maynilad’s by allowing a partial adjustment way below the one approved by the Singapore-based panel.

Worse, the MWSS now wants to drag the Supreme Court into this legal mess it has created on its own by planning to seek the SC’s opinion on these disparate ICC orders, even if the decisions of the arbitral tribunal are supposed to be final in keeping with global rules on Alternative Dispute Resolution (ADR).

As expected, Maynilad is pursuing its second arbitration case before the ICC seeking compensation of P3.44 billion in losses plus P208 million more for every month since after the Appeal Panel’s December 28 order.

As revealed by CFO Randolph Estrellado to the media, “We will definitely not implement the partial rate adjustment and will continue to pursue our claim on the government undertaking through arbitration in Singapore.”

INSURANCE FORUM

U

nder Section 148 of Act 1459 (March 1, 1906), otherwise known as The Corporation Law, an insurance corporation must have a capital stock of “not less than P500,000” and “that 50 per centum of the whole stock has been actually subscribed, and that 50 per centum of the subscription has been actually paid in cash.” Thus, an insurance corporation must have at least P125,000 in paid-up capital (PUC). Section 148 further provides that the “whole subscribed capital stock of any fire and marine insurance corporation must be fully paid up in cash within one year after filing its articles of incorporation.”

In December 1914 Act 1459 was repealed by Act 2427, otherwise known as the Insurance Act. Section 196 of Act 2427 required that every insurance corporation shall “have a subscribed capital stock equal to at least P250,000, 50 per centum of which must be paid up in cash previous to the issuance of any policy, and the residue within 12 months from the date of filing its articles of incorporation.” The capitalization requirement under Act 2427 practically had no difference from that under Act 1459.

Presidential Decree (PD) 63, dated November 20, 1972, introduced an amendment to Act 2427.

PD increased the PUC requirement to “at least P2 million.” For the first time, the secretary of finance was granted the power to “increase such minimum paid-up capital stock, under such terms and conditions as he may impose, to an amount which, in his opinion, would be sufficient to reasonably assure the solvency of the company and the safety of the interests of the people.”

E-mail: ernhil@yahoo.com.

A fake debate over trade talks

G

overnment secrecy is a far more captivating topic than the failings of intellectual-property protections in Southeast Asia. So it’s hardly a surprise that Sen. Elizabeth Warren of Massachusetts has made secrecy the focus of her latest critique of the most ambitious trade agreement in US history.

Unfortunately, her charge that the Trans-Pacific Partnership (TPP) is being negotiated in secret suffers from two fatal defects. The first is that the deal isn’t so secret. The sec-

Dennis B. Funa is presently the deputy insurance commissioner for Legal Services of the Insurance Commission.

E-mail: dennisfuna@yahoo.com

ond is that some secrecy is justified.

Warren is right that talks over the TPP, which are at a delicate stage, are taking place out of public view.

But members of Congress can read the draft agreement at any time— which, to her credit, she has.

Meanwhile, environmental, labor and consumer advocates are invited to join advisory committees that guide the US’s position in the talks. Along with corporate executives and other industry representatives, advocates have full access to the latest documents.

Yes, they must abide by confidentiality rules—as must members of Congress, who cannot discuss the specifics of the text in public. That’s entirely appropriate. Whether negotiating international trade agreements or congressional budget deals, sometimes secrecy is necessary.

By their very nature, treaty negotiations are usually classified until they’re finished. If they weren’t, countries wouldn’t hand over proprietary data and take political risks.

Moreover, the Office of the US

2nd Front Page BusinessMirror

A8 Wednesday, May 6, 2015

Exporters keep 2015 targets despite problems in US, EU E

xporters expressed optimism that outward shipments of Philippine products could still grow by 8 percent to 10 percent this year, as they expect demand from the country’s major markets, such as Japan, to remain robust.

Philippine Exporters Confederation Inc. (Philexport) President Sergio R. Ortiz-Luis made this pronouncement even as the value of Philippine merchandise exports slid in the first two months of the year.

“Despite problems in markets like Europe and the United States, we still have a fighting chance to [hit] the 8 [percent] to 10 percent [growth target] this year, because there is still demand from Asean countries

ORTIZ-LUIS said the performance of electronics—the country’s main export— gives exporters reason to hope that outward shipments of local products could grow by as much as 10 percent in 2015.

and Japan,” Ortiz-Luis said.

He added that the performance of electronics—the country’s main export—gives exporters reason to hope that outward shipments of local products could grow by as much as 10 percent in 2015.

In an interview last week, Semiconductor and Electronics Industries in

the Philippines Inc. (Seipi) President Dan Lachica said that, while semiconductor exports remain strong, it is still “too early” to revise targets upward. Seipi is targeting to grow electronics exports by 5 percent to 7 percent this year.

Outward shipments of electronic products rose by 4.8 percent year on year to $1.97 billion in February, according to data from the Philippine Statistics Authority (PSA).

By major groups of electronic products, Components/Devices (Semiconductors), comprised 29.5 percent of the total exports in February and were valued at $1.33 billion. The figure is 16 percent higher than the $1.14

billion recorded in the same month last year.

Merchandise exports went down by 0.5 percent in January and 3.1 percent in February, according to data from the PSA. Earlier, First Metro Investment Corp. and University of Asia and the Pacific’s Capital Markets Research projected that export growth in the first quarter of the year would be “modest.”

The report expects outward shipments of Philippine products to grow by a single digit in January to February due to weaker demand for major commodities, ,such as woodcraft and furniture, metal components and coconut oil. Catherine N. Pillas

El Niño threatens inflation outlook. . .

“Timely importation of rice to augment domestic supply should serve as a ready measure to prevent the repeat of the high rice prices witnessed in the third quarter of 2013 until 2014,” Esguerra said.

“There should be programs to cover the use of appropriate technology to expand production capacity, as well as intensification of credit programs and facilities with crop insurance,” he said.

Esguerra also said the government must continue efforts to decongest Metro Manila to avoid future disruptions in the domestic-supply chain.

As a consequence, the Bangko Sentral ng Pilipinas (BSP) was seen keeping the policy rates unchanged at the scheduled rate-setting meeting of the Monetary

Board (MB) next week, as the low inflation print in April helped make that decision highly likely.

The Bangko Sentral ng Pilipinas (BSP) was seen keeping the policy rates unchanged at the scheduled rate-setting meeting of the MB next week, as the low inflation print in April helped make that decision highly likely.

The inflation rate in April was also within the forecast, ranging from 1.9 percent to 2.8 percent, earlier announced by the Bangko Sentral ng Pilipinas. This was also lower than consensus forecast by private economists surveyed by the BusinessMirror, averaging 2.4 percent.

At present, the BSP borrows from and lends to banks at 4 percent and 6 percent, respectively. The rates have

been in place since September last year.

While headline inflation is still within the target of 2 percent to 4 percent, BSP Deputy Governor for the Monetary Stability Sector Diwa C. Guinigundo said the likelihood for inflation lower than 2 percent in the coming months could come to pass if the trend continues.

Guinigundo reiterated inflation this year should definitely average within target.

Inflation started to tick up as high as 4.9 percent in May up to August last year.

No matter the benign outlook to inflation, however, Tetangco said the MB remains on the alert against risks that could threaten the stability of the economy.

Continued from A1

“We will nevertheless remain watchful of developments, especially the Fed actions and global market interpretation of such actions, how the interaction of these two factors are absorbed by our own financial markets; and how domestic economic agents use these to shape their inflation expectations,” Tetangco said on Tuesday in a text message to reporters.

It was noted that congestion at the Port of Manila last year significantly affected not just the country’s export and import growth but food prices, as well.

In April the Neda said food inflation slowed to 4 percent in April 2015. The Neda said the slowdown in food inflation may be attributed to slower price adjustments in rice, meat and fruits.

www.businessmirror.com.ph

Stocks slide seen to end then rise as much as 4.9%

T

he second-largest Philippine money manager is taking advantage of the worst month for the country’s stocks since 2013 to add holdings, betting that improved company earnings will trigger a recovery.

Smith Chua, chief investment officer at Bank of the Philippine Islands (BPI), says he’s adding to holdings of consumer, power and property companies, sectors on which he’s overweight. The country’s stock gauge, Southeast Asia’s best performer in 2015 even after a 2.8-percent loss in April, will probably rise as much as 4.9 percent this year from Monday’s close, as earnings growth more than double, he said. The gauge gained 1 percent at the noon trading break in Manila on Tuesday.

Investors pulled $203 million out of Philippine stocks in April, the only Asian market tracked by Bloomberg to register net sales by foreigners during the month. The outflows coincided with unprecedented inflows into exchange-traded funds tracking Chinese companies in Hong Kong. While the withdrawals out of the Philippines have weighed on local shares, Chua says global investors will turn into buyers if equities fall further.

“This is a temporary correction,” said Chua, who helps oversee about $14 billion in assets at BPI. “There are still many offshore investors who are waiting for reasonable levels to come into the Philippines.”

The Philippine stock index may fall as low as 7,400 if more funds are taken out for investment in Chinese equities, Chua said.

Still, the index won’t stay there for long as other investors are waiting for an opportunity. There are also no strong indications that the Philippine economy has been derailed from its growth path, he said.

Bloomberg News

pldt on course to hit 2015 core income goal. . .

Wireless service revenues of P27.9 billion for the first quarter of 2015 were 4 percent lower than the P29 billion recognized last year, reflecting the pressure on text and inbound international revenues.

Postpaid revenues now account for 23 percent of total cellular revenues, having improved 11 percent to P5.7 billion for the first three months of 2015.

Total mobile subscriber base at the end of the year number 69.6 million, broken down as follows: Smart had 25.9 million subscribers under its mainstream Smart brands; value brand Talk ‘N Text ended with 28.1 million subscribers; and there were 15.7 million Sun Cellular subscribers.

Data also drove the group’s bottom line this year, posting an 11-percent growth to P11.2 billion, which now account for 27 percent of total service revenues.

The group’s fixed broadband businesses generated

P3.8 billion in revenues for the period, up by 10 percent from P3.5 billion in 2014.

Wireless broadband revenues, exclusive of mobile Internet revenues, increased by 2 percent to P2.5 billion, compared with the P2.4 billion recorded last year. Corporate data, inclusive of data-center revenues, rose by 15 percent to P2.6 billion from the same period in 2014.

Moreover, mobile Internet usage continues to grow strongly, with mobile Internet revenues increasing by 19 percent to P2.2 billion in the first quarter of 2015 from P1.9 billion for the same period in 2014.

Fixed-line service revenues for the first three months of 2015, net of interconnection costs, increased to P14.3 billion, or 4 percent, from P13.7 billion last year.

The fixed-line subscriber base reached over 2.2 million at the end of the period, over 50 percent of which have fixed broadband subscriptions.

The group leads in enabling infrastructure for the enterprise sector with six data centers at the moment and another two on the way. These data centers offer colocation, server hosting/outsourcing, disaster recovery, connectivity and data scrubbing. These centers are telco-grade, carrier-neutral and vendoragnostic with an aggregate rack capacity that is the largest in the country.

“PLDT is uniquely positioned to offer a unified customer experience—that of a Connected Individual and a Connected Home. This ‘boundary-less’ environment allows us to fuse our consumer and home businesses into one that is symbiotic and complementary,”PLDT President and CEO Napoleon L. Nazareno said.

Refreshed leadership

Pangilinan added: “While our core revenue sources

undergo this transition phase where the erosion of our high-margin legacy businesses still outpaces the growth of our newer initiatives for now, we are taking significant steps to ensure that we are ready and prepared for the digital future. This future will require looking at our customers from a different set of lenses, as both individuals and enterprises embrace a digital life.”

On the enterprise side, the company is looking to data-center infrastructure, big data and the cloud as its digital enablers; while for the consumer, digital commerce, mobile money and entertainment.

“In both instances—enterprise and individuals— our major task is to deliver and ensure that the digital experience is enriching,” he said.

“To achieve this,” the executive noted, “we need to invest in a transformative infrastructure that will provide

Continued from A1

the ‘digital spine’ for our networks, engage in strategic partnerships with the Internet community that will bring value beyond connectivity, invest in ventures that will transform our local verticals into global horizontals of which Rocket Internet is a clear investment case, and develop our own applications and initiatives—of which LockbyMobile represents an outstanding example.”

The chief honcho of the largest telecommunications firm in the Philippines added that these times also demand an organizational restructuring.

“We also need to refresh our leadership team and, accordingly, we have just announced a major reorganization of some of our senior executives. We also welcome two new members with exemplary credentials —Winston Damarillo, our new chief strategy officer, and Joachim Horn, our chief technology and integration advisor,” Pangilinan said.

PHL, CANADA START TRADE TALKS AHEAD OF P-NOY VISIT T

rade and investment relations will be high on the agenda of Manila and Ottawa when President Aquino makes his official visit to Canada, with both nations expressing interest to forge a bilateral freetrade agreement (FTA).

The Department of Trade and IndustryIndustry Development and Trade Policy Group, led by Undersecretary Adrian S. Cristobal Jr., already visited the North American country last week as a part of the preparatory committee for the Chief Executive’s visit.

Cristobal said initial discussions centered on a possible bilateral FTA. “Since our sectors are complementary and we both have strategic interests, we looked into the possibility of having an FTA. We opened up that topic,” Cristobal said.

Canada has already marked the Philippines as a “priority market” in its Global Markets Action Plan, the Canadian government’s global strategy in expanding its trade and investment relations Another major highlight of the meeting is the intent of both nations to review its Foreign Investment Protection Agreement (Fipa).

The Fipa is a bilateral agreement aimed at protecting and promoting foreign investment through legally binding rights and obligations for both countries.

According to the Canadian government’s web site, Fipas set out a range of obligations that host governments pledge to uphold, covering nondiscriminatory treatment, expropriation, transfer of funds, transparency, due process and dispute settlement.

The Fipa between the Philippines and Canada is aimed at protecting one country’s trade and investment from domestic policies enforced in the other that may endanger foreign investments. In the Philippines-Canada Fipa, for example, neither country can impose a local-content level as a requirement to making an investment.

President Aquino will be visiting Canada from May 7 to 9, and will meet with Canadian Prime Minister Stephen Harper to discuss a range of political and economic issues.

Bilateral merchandise trade between Canada and the Philippines amounted to $1.7 billion in 2013, up 14.6 percent over the previous year.

Canadian exports to the Philippines reached $593 million in 2013, up from $527.9 million in 2012.

Canada’s top exports to the Philippines are meat, wood and related products, and cereals. Top merchandise imports were electrical machinery and equipment, precision and technical instruments, and machinery. Catherine N. Pillas