BusinessMirror May 27, 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, 27,2014 2015Vol. Vol.1010No. No.40230

www.businessmirror.com.ph

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

SAN MIGUEL APPEAL FOR CALAX REBIDDING GOES TO NAUGHT AS IT LOSES PPP DEAL TO MPIC

Govt all smiles after huge Calax yield C Life B L S. M

INSIDE

ONGLOMERATE Metro Pacific Investments Corp. (MPIC) topped the auction for the multibillion-peso Cavite-Laguna Expressway (Calax) deal with a P27.3-billion premium bid, the highest single premium that the government received from a public tender thus far.

ANDROID RIVAL

The faithfulness of God

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EAR Lord, from that moment on, especially after Your ascension into heaven, the scriptures became for the believers, became a continuous reminder of their crucified and risen Lord, and a privileged “place” where they could find You. By reading the scriptures, they could realize the faithfulness of God to His promises and once again experience the presence of the glorified Christ among them as in the days immediately after the Resurrection. No matter who we are, the faithfulness of God remains the same. We strive then to be always good children of God. Amen.

FACEBOOK DEBUTS INSTANT ARTICLES WITH 9 MEDIA OUTLETS »D2

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

BusinessMirror

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

Wednesday, May 27, 2015

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Cyanogen CEO Kirt McMaster sees big future for Android rival

KIRT MCMASTER, CEO of Cyanogen, which offers an alternative Android operating system now on 50 million phones.

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B T W San Jose Mercury News

IRT MCMASTER can be a bit brash as when he told Forbes magazine earlier this year that his small Palo Alto, California, start-up is “putting a bullet through Google’s head.”

But his bravado is of a piece with his bold vision to build and market a mobile operating system to rival Google’s Android and Apple’s iOS. That’s something others have tried and failed to do, but Cyanogen, McMaster’s company, is offering something that other operating system rivals have lacked: A platform that is based on and fully compatible with stock Android.

For McMaster, the key difference between Cyanogen and Android is that his software can tightly integrate non-Google apps. Last month, for example, Cyanogen announced a deal with Microsoft to build services such as Bing, Skype and OneNote into its software, something that would be unthinkable with Google’s version of Android.

McMaster spoke with the San Jose Mercury News last month about his ambitions for Cyanogen and the company’s relationship with Google. The interview has been edited for length and clarity.

What’s your business opportunity?

It’s pretty straightforward: 5 billion-plus Android devices in five years; 50 percent or greater of those devices are not going to be Google Android devices; therefore, you have a 2 billion-plus market gap to be filled. We think we can capture a big piece of that.

That’s bigger than the entire smartphone market today.

I think there’s a several-hundred-billion-dollar opportunity in the non-Google Android space over the next five years. We intend to capture as much of that as we can.

But you’re building on Android. How can that be all that distinct from Google’s version?

We offer many different features and enhancements and better security and all that good stuff. Soon you will start to see new experiences on Cyanogen that are different from stock Android and iOS. You can already see some of these things. We just did an integration with Boxer for e-mail. We’re working with Nextbit. But you’ll start to see things over the next couple of quarters on our platform that are radically different than on any other Android platform.

Cell-phone manufacturers have tried to distinguish their Android phones by creating their proprietary distinct apps and interfaces.

Why would they choose instead to offer Cyanogen-based devices?

Because they’re terrible at software and services and they know it, and they’re failing with it. A lot of the people who run Cyanogen do it because it gets rid of the Samsung crap they have on their device.

From a manufacturer’s perspective, what is the advantage of going with Cyanogen over straight Google Android?

Economics. We provide revenue on services in a way that others do not. We believe that what we’re doing will create more revenue, more income, better economics for all the parties.

Given Google’s efforts to take more control over Android, and the direction you want to move in, are you worried that at some point Google might cut you off?

No. Everything that’s in the existing developer agreements, we abide by.

There’s a big non-Google platform that Google supports. It’s called iOS. Why do they support it?

Because they have hundreds of millions of users. The same will be the case with us. I don’t think Google is

going to want competing services to be the default services and not be there. That would be a huge mistake for Google.

I think that as we continue to grow, Google will continue to support us, and we want to continue to work with Google.

I use Google services. Everybody in this company does, and so do our users. And we’d love to figure out ways that Google services can actually do things on our platform that they couldn’t possibly do on their own platform with some of the other partnerships we’re working with.

What are some of the things Google might be able to do with your platform that it couldn’t do with its own?

There are a lot of companies that would never provide a certain level of data to Google for fear that

it would continue to make them stronger and create greater lock in. So as we open up Android, we become more of a Switzerland. We think that we will probably be better at sharing data with partners that would never share that data with Google.

The flip-side of that is if we continue to have a constructive relationship with Google, they will get to participate in all of the benefits that we can bring to the table that they may be challenged to create for themselves.

Where are the biggest potential markets for Cyanogen?

Right now, it’s India. It’s really shaping up to be the next China. But Cyanogen is all over the world. We’re in the US, Canada and India and Indonesia, etc. Right now, almost every Android enthusiast uses Cyanogen. So there’s no market that we’re not interested in. n

‘Minecraft’ most-watched game on YouTube over last decade DEMAND for “Minecraft” videos is huge. It’s the most-searched-for term on YouTube after “music.”

Turns out, the supply is just as vast.

YouTube said on Wednesday it stocks 42 million videos related to the virtualworld building game “Minecraft,” the most-watched game on YouTube over the last decade based on total viewing time. It’s followed by “Grand Theft

Auto” and “League of Legends.”

YouTube announced the statistics as part of its 10th anniversary festivities, making it clear that Amazon.com’s highly successful Twitch.tv video operation isn’t the only game-streaming heavyweight. (Each day, millions of people watch other people play video games on YouTube and Twitch.tv.)

In November Google-owned

YouTube hired Ryan Wyatt, a popular gaming commentator, as global head of gaming. It’s working to improve livestreaming tools for gamers. And it’s celebrating Wednesday as “Let’s Play Day,” an homage to videos of people playing a game while chatting about their actions.

YouTube said Let’s Play video producer Markiplier has been searched

for on YouTube 10 times more often than singer Jay-Z over the past year. He now has 7 million subscribers.

Other highly watched game series include “Call of Duty,” “FIFA,” “The Sims” and “Five Nights at Freddy’s.”

Lesser-known titles on the top 10: building game “Garry’s Mod” and puzzle-and-fighting combination “Puzzles & Dragons.” LOS ANGELES TIMES

Asus announces availability of ZenFone 2 curved case that tapers to an incredibly thin 3.9mm at the edges. The exclusive Ergonomic Arc design provides a comfortable, secure grip, and features an intuitively placed volume-control key on the rear of the phone within easy reach of the user’s index finger.

The 5.5-inch Full HD IPS+ screen has a large 72-percent screen-to-body ratio that provides a maximized viewing experience, while reducing ZenFone 2’s overall size.

ZenFone 2’s 13MP PixelMaster camera with its f/2.0 wide-aperture lens lets users quickly and easily capture beautiful, high-resolution photos with zero shutter-lag. Camera features, including Low Light mode, Backlight

new design, 13-megapixel PixelMaster camera, and uncompromising performance delivered by a 64-bit Intel Atom Z3580 processor with up to 4-gigabyte RAM. An Intel Long-Term Evolution (LTE)-Advanced modem provides ultra-fast and reliable 4G/ LTE connectivity. Leveraging a quartercentury of engineering accomplishments

by Asus, the highly anticipated ZenFone 2 provides a wealth of exciting new features and an even more refined Asus ZenUI. Employing iconic Zen design elements, such as a sleek, brushedmetal finish and concentric-circle detailing, the new flagship introduces new refinements, including a graceful

NO less than Asus CEO Jerry Shen flew into Manila recently to announce the availability of ZenFone 2 locally.

At the “Experience 2Morrow” media event in Manila held on May 16, Shen unveiled the highly anticipated ZenFone 2 that builds on the enthusiastic reception and success of the firstgeneration ZenFone in the Philippines and all of Southeast Asia.

It features a stunning new Zeninspired design, uncompromising performance and an intuitive user experience to bring a new level of empowering luxury to consumers.

The newest flagship smartphone in the hugely successful ZenFone family, the Asus ZenFone 2 features an all-

LIFE

(Super HDR) mode, and Super Resolution mode, ensure incredible photos even in dimly lit situations.

ZenFone 2 has a 3000mAh battery that provides more than enough power to get through the day, and it also features BoostMaster1 fast-charge technology for dramatically-reduced recharge times.

Beyond this quick preview, a deeper meditation on the ZenFone 2 should be up shortly. For now, Asus’s new flagship dual SIM smartphone is available in three storage configurations, the highest being 64GB—and even that is very competitively priced at an SRP P14,995.

That should put pockets of geeks and consumers everywhere around these parts in a state of pure Zen.

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FACEBOOK PUBLISHING D2

Personal Tech BusinessMirror

Wednesday, May 27, 2015

www.businessmirror.com.ph

Facebook debuts Instant Articles with 9 media outlets

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B A C Los Angeles Times

ACEBOOK has launched Instant Articles, enabling media outlets to publish their stories directly to the social network.

Nine big news publishers, including the New York Times, BuzzFeed and National Geographic, have signed on as launch partners. After months of rumors, Facebook began hosting their news articles on its iPhone app on Wednesday. “ s more people get their news on mobile devices, “A we want to make the experience faster and richer on Facebook,” Product Manager Michael Reckhow said.

It’s a bit of an uneasy arrangement, with news outlets handing over some control to the Menlo Park, California, tech giant.

In return, the publishers hope to grow their readership and reach by increasing their presence on the world’s biggest social network.

“We’re participating in Instant Articles to explore ways of growing the number of Times users on Facebook, improving their experience of our journalism and deepening their engagement,” said Mark Thompson, chief executive of the New York Times Co. Facebook maintains that the platform was designed to keep publishers in charge of their content, brand

experience and money-making opportunities.

The company said Instant Articles uses the same technology used to display photos and videos quickly in the Facebook app, so articles load instantly, “as much as 10 times faster than the standard mobile Web.” Instant Articles also includes a suite of interactive features. Readers can zoom in and explore highresolution photos by tilting their phones, watch autoplay videos as they scroll through stories, explore interactive maps, listen to audio captions, and like and comment on individual parts of an article. The other launch partners are NBC, the Atlantic, the Guardian, BBC News, Spiegel and Bild.

Also this week, Facebook announced that it was

boosting benefits for its contractors and vendors in the US. The benefits include a $15 minimum wage, minimum 15 paid days off for holidays, sick time and vacation, and for workers who don’t receive paid parental leave, a $4,000 new child benefit for new parents.

“Taking these steps is the right thing to do for our business and our community,” Chief Operating Officer Sheryl Sandberg wrote in a blog post.

“Women, because they comprise about two-thirds of minimum wage workers nationally, are particularly affected by wage adjustments. Research also shows that providing adequate benefits contributes to a happier and ultimately more productive work force.” n

The latest hotness especially hand-delivered STAYING true to its commitment of providing exclusive experiences to its customers, Globe Telecom premium postpaid brand Globe Platinum (www. globe.com.ph/platinum) is bringing globe.com.ph/platinum their Samsung Galaxy S6 and S6 edge through a special hand-delivery service to their preferred addresses, making them among the first owners of the latest hotness in gadgets in the country.

Globe Platinum members who have ordered the elegantly crafted handsets from the recent exclusive viewing parties and through the online preorder page enjoyed the privilege and convenience of having their Samsung smartphones delivered straight to their homes on April 18, the day of the phones’ official global release.

Personally handed by their own Platinum Relationship Managers, this eliminated the need for customers to pick up the units at Globe stores, giving them the convenience of receiving it in the comfort of their homes.

The deliveries even came with fantastic surprise treats which included tickets to a blocked screening of Avengers: Age of Ultron with free popcorn and drinks, JBL Micro-II Ultra Portable Speakers, Samsung wireless

THANKS to Globe Platinum’s Platinum Relationship Managers who hand-Selivered the new Samsung Galaxy S6, Platinum customers didn’t need to pick up their units in Globe stores

z

Today’s Horoscope

charger, and discount vouchers to Galaxy S6 and S6 edge accessories.

“This special treatment anchors back to the Globe Platinum promise of fast, reliable, and worry-free service for all its customers. As the company’s premium postpaid brand, it is always our mission to give our clients a firstclass experience. This is why we took great effort to ensure that Samsung’s most sought-after smartphones reach our customers quickly and conveniently ahead of others,” Globe Vice President for Platinum and Roaming Business Coco Domingo says.

Select Globe Platinum members even got their handsets in advance and also experienced first-rate treatment at the official launch event of the S6 and S6 edge at the SM Megamall Fashion Hall held on April 17.

Customers were picked up via VIP car and also indulged in champagne while comfortably seated in their reserved seats.

The event also saw the introduction of Globe Platinum’s new ambassadors such as food and travel writer, chef and TV host Stephanie Zubiri-Crespi; GrabTaxi Acting General Manager Natasha Bautista, businessman Marc

ARIES (March 21-April 19): Restlessness will lead to personal problems. Spend more time checking out vocational options and researching what you require to move in a direction that can bring in more cash and stimulate you mentally.

Boredom is the enemy. HHH

a

CANCER (June 21-July 22): Find a way to make your surroundings more user-friendly and comfortable. Your efforts will be appreciated and your nerves less frazzled if you feel at peace when you are at home. Romance will lead to a close bond with someone special. HHHH

d

LIBRA (Sept. 23-Oct. 22): You’ll make a difference if you speak up and take action. Conversations will lead to new beginnings. Ignore people who display jealous tendencies. Don’t get involved in anything that could damage your reputation. Work alone and take all the credit. HHH

b

e

LEO (July 23-Aug. 22): Check out what everyone else is up to.

Something or someone will stand out and lead you in a new direction. Personal advancement will raise your confidence.

Don’t hold back if you have something to contribute. HHH

h

f

i

TAURUS (April 20-May 20): Concentrate on getting along with your peers. Take care of debts that have been weighing you down. A resourceful approach and some practical and well-thoughtout money-management advice will put you on top. HHHHH

By Eugenia Last

CELEBRITIES BORN ON THIS IS DA DAY: Chris Colfer, 25; Jack McBrayer, 42; Paul Bettany, 44; Louis Gossett Jr., 79.

c

GEMINI (May 21-June 20): Put a little muscle behind your mouth and turn talk into a reality. Someone will point out your shortcomings if you don’t give your all. An emotional situation with a child or elder must be handled with kid gloves. HH

HAPPY BIRTHDAY: DA Work on self-discipline and DAY: quitting bad habits. Focus on getting healthy and making the most of your life. Distance yourself from the people in your life who cloud you with negativity. Learn from past mistakes and indulgences. Spring into action and follow through with positive and progressive plans that will encourage a better life. Your numbers are 7, 9, 20, 24, 32, 37, 45.

VIRGO (Aug. 23-Sept. 22): Everything you pursue will depend on precision, knowledge and expertise. Expect to be criticized by someone who is trying to make you look bad. Stick to the methods that work and to the people you know you can trust. HHH

offered only by Globe Platinum.

Apart from enjoying first and exclusive access to products and events, Globe Platinum subscribers are also entitled to an international 24/7 concierge service, personal relationship managers, priority in Globe stores, a dedicated Platinum hotline, and perks from partner establishments.

unlimited calls and texts to all networks, 15 gigabyte of mobile Internet with twoday unlimited data roaming monthly, unlimited access to Facebook, Viber, Yahoo! Mail, and GMail on top of the 15-gigabyte mobile Internet allocation, plus an additional premium app of their choice: Spotify Premium or HOOQ. All of these services are again first to be

Soong, and lifestyle and beauty blogger and model Kelly Misa. Columnist and society darling Tessa Prieto-Valdes also graced the event as Globe Platinum’s honorary guest.

Those who subscribed to the recently launched Platinum Lifestyle Plan 4,999 also got their Samsung S6 edge for free along with new perks such as

g

SCORPIO (Oct. 23-Nov. 21): You will come across an interesting prospect. Get involved in an event that will help you meet other creative people.

Look for insights and ideas as to how you can improve your appearance or talents. Romance is highlighted. HHH

SAGITTARIUS (Nov. 22-Dec. 21): You’ll have plenty to deal with. Take note of what others say and do and use diplomacy to avoid a controversial situation that can make you look bad. Change is good, but only if it’s based on honesty and good intentions. HHHH

The bid edged out the P22.2-billion premium offered by San Miguel Corp. to win the deal. The food-toinfrastructure firm sought for the rebid of the contract last year.

Public Works Undersecretary Rafael M. Yabut was seen smiling all throughout the opening of the financial proposals on Wednesday.

He said he was wowed by the turnout of the auction.

“It is worth waiting for, considering the discrepancy of the bids from the previous auction,” he said in bilingual, when sought for comment. “The results show that everything went well for the gov-

k

AQUARIUS (Jan. 20-Feb. 18): Be a participant and have a little fun.

A change of scenery will stimulate your mind and give rise to all sorts of interesting ideas and plans that could raise your standard of living. HHH

l

PISCES (Feb. 19-March 20): You are best to work alone if you want to avoid disagreements. An emotional matter will leave you thinking about what you want to do next and whom you want to spend time with. HHH

The Universal Crossword/Edited by Timothy E. Parker

46 48 50 52 56 59 60 61 63 64 65 66 67 68

Villainous visages “The March King” Plath’s Muse Grapefruit serving, often Startling things Sweetie pie Hayworth the Hollywood legend Draft Track-and-field contest Subside to a drizzle Chip in a pot “You bet!”

Jalousie parts Roll call refusals

9 10 11 12 13 18 22 24 27 29 30 31 32 33 35 39 42 43 45 47 49 51 53 54

Interstate calamity Nebulous Pool game Profess Summer shirts Male red deer Mont. neighbor Elitist Fluctuates “Sphere” start “____ you be my neighbor?”

Things to abide by Decrease?

Sideshow sight Star Wars surname?

Cattle drive actions Saw-edged London streetcar Rainless Bargains Crystal-baller Window for plants Madison Square Garden, for one Like the dryer filter

55 Celebrations 56 Octopod’s octet 57 In ___ of (replacing) 58 Madrid miss (Abbr.)

62 Lower, as prices

PERSONAL TECH DOWN 1 ___ anchor (stay put, nautically) 2 Beyond silly 3 An Einstein he’s not 4 Leave confidently in one’s care 5 Refuse to be annoyed by 6 Sawbuck 7 Semis 8 Skilled

Solution to yesterday’s puzzle:

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SECURED LIVING

Mindanao Bureau Chief

BusinessMirror

Second of three parts

E1 | Wednesday, May 27, 2015 Editor: Tet Andolong

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THE BEAUFORT

AN EPITOME OF LUXURY

AND SECURED LIVING B R R R

HE continuous growth of the Philippine economy has boosted all segments of the property sector. For instance, the Bonifacio Global City (BGC) has experienced a tremendous uptake of condominium units in the high-end market with rents that lesser mortal could only dream of.

THE high-rise luxury market is thriving with monthly rentals for three-bedroom units at The Beaufort in Bonifacio Global City, some with full views of the golf course, going for as high as P180,000 per month.

Despite being a tyro in the luxury market compared to its listed counterparts, Siquijor said investors are noticing that its units offer them more value, which they, in

CURTAIN walls and efficient space planning—both of which make units at The Beaufort seem more spacious than they are—are highly valued by lessors of luxe units.

They also pay keen attention to the elevator-resident ratio.

well as close proximity to premium destinations—the key elements of the best addresses in the leading capitals of the world,” according to Josephine Gotianun-Yap, president and chief executive officer of Filinvest.

Maita Herce Siquijor, a licensed realtor who recently sold units at the project carrying the Filinvest Premier brand, said the demand for these affluent products will continue to grow as the economy keeps on growing and as there is a demand for it.

Siquijor explains that tenants of luxury units have very discriminating tastes, as they actively seek innovations in residential projects that deliver greater comfort and conveniences for them.

For tenants with housing allowances between P100,000 and P200,000, changing residences is worth the effort since they will enjoy benefits like having only three neighbors on a floor, amenities like a minitheater for private screenings or plush seating areas at the lobby that have the feel of a hotel.

turn can use to attract lessors.

Completed in 2013, units at The Beaufort have already appreciated in the secondary market because of this perception.

Once an expat in Singapore where her husband was assigned, she noted, “Expat tenants tend to highly appreciate low-density developments with high-grade amenities like the curtain wall of The Beaufort and its efficient space planning, which make the place seem more spacious than it is.” They also highly value their time and pay keen attention to the elevator-resident ratio, which at The Beaufort is four units to a floor and serviced by three elevators per tower.

A Jones Lang Lasalle (JLL) AsiaPacific study released at the end of 2014 ((www.ap.jll.com) explained that investment demand for this segment “continued to tread positively supported by the healthy economic conditions and low-interest rate environment.” Furthermore, JLL reported “the expanding offshoring

and outsourcing industry, as well as the positive outlook on the economy, will likely continue to support leasing and investment demand” for luxury projects.

With prices ranging from P8 million for a one-bedroom unit up to P30 million for a three-bedroom unit at the East Tower, The Beaufort’s units and others in this segment account for an estimated 7,000 units only in Metro Manila.

“The Beaufort is one of BGC’s more premium developments offering only four units to a floor. Its penthouse units in the two towers situated above a six-story banking podium were among the first to be sold, indicating the quality of the development,” said Catherine Ilagan, executive vice president of Filinvest Alabang.

Aside from luxury living, Filinvest fills in the demand for a high level of security just like lessors who are closely affiliated with the diplomatic corps.

The Filinvest Group addressed this concern at The Beaufort with a sophisticated building management system that provides real-time monitoring, command and control, automation and report management— all from one platform. Each resident is issued a preprogrammed card that gives him elevator access only from his parking floor to his residential floor and from the ground floor lobby to the seventh floor, where amenities are located.

Other details that lessors in the high-end market look for include the floor-to-ceiling height of the units, the waiting time at the elevators and even the turning ratios at the parking floors.

Only 14 percent of the units priced from P8 million and up are still available. Most of them range from one- to three-bedroom units.

PROPERTY TENANTS of luxury units actively seek innovations in residential projects, like The Beaufort’s minitheater for private screenings.

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of agreement (MOA) to promote health awareness among Filipinos. Signing the MOA are (from left) CSMC Vice President and CFO Elizabeth D. Dantes, CSMC President and CEO lawyer Pilar Nenuca P. Almira, BUSINESSMIRROR Group of Publications VP for Finance Adebelo D. Gasmin and BUSINESSMIRROr Group of Publications VP for Advertising Sales Marvin N. Estigoy. ALYSA SALEN

The price and ‘prize’ of peace in Mindanao T B M T. C

THE Beaufort at Bonfiacio Global City is representative of a new generation of luxury units that are smaller in size and make use of advanced technology to provide residents with greater convenience and security.

HEALTH PARTNERSHIP The BUSINESSMIRROR, Health&Fitness, Philippines Graphic and Cardinal Santos Medical Center (CSMC) ink a memorandum

Palace vows more efficient state spending in Aquino’s final year

j

CAPRICORN (Dec. 22-Jan. 19): Contain your emotions and give yourself time to absorb what others tell you. Time is on your side, so don’t feel pressured to make a hasty decision. If someone pushes you, back away and move on. HH

‘elemental’ BY LEWIS FORTE

Filinvest Development Corp. (Filinvest), the property-development unit of Filipino-Chinese tycoon Andrew Gotianun, is a major player in BGC focused on the luxury market.

One of the company’s significant developments goes by a Britishinspired name—The Beaufort, a 43-story structure that veers away from the usual offerings of ultrahigh-end condos.

The Beaufort is a hit among expatriates because it caters to their definition of luxury in BGC. The monthly rent of P180,000 is enough to convince people that this piece of property is only for the high and mighty. Aside from the elite, expatriates and returning residents who have lived abroad, and high-income households continue to drive this rental market concentrated in BGC and in Makati City.

“We are seeing a strong takeup of The Beaufort units, which, in addition to exclusivity, offer superior technology, great views of both the Manila Golf and Makati skyline, as

C  A

BIRTHDAY DAY BABY: You are emotional, proactive and passionate. You are a perfectionist.

DA

ACROSS 1 Citrus fruit 5 Backward parts?

10 Hit a baseball long and far 14 “Move” or “cash” followers 15 Noted Swiss miss 16 Privileged person 17 Heavenly hit from the ‘50s 19 Precisely (with “to”) 20 Polar wear 21 Cash dispensers?

23 Lengths of service 25 Royal house 26 Kind of silence 28 Yellow American fruit 31 Brit’s elevator 34 In the military it’s messy?

36 Japanese city 37 Jackie O’s second spouse 38 Anteroom 40 K-O links 41 Most unfavorable 44 Dorothy Gale’s dog 45 Chimney sweep’s concern

T

ernment and the country.”

Public-Pr ivate Par tnership (PPP) Center Executive Director Cosette V. Canilao said the yearlong delay proved to be worth the wait for the government due to the multibillion-peso revenue it generated from the rebidding.

“They have more than enough time to sharpen their pencils.

Had the other bidders participate in the rebid, maybe their bids will also be different, given more than a year to again [conduct] the due diligence and sharpen their numbers,” she said.

AVAO CITY—Gov. Mujiv Hataman, the chief executive of the Autonomous Region in Muslim Mindanao (ARMM), has offered no contest or disdain to the incoming Bangsamoro political entity that would soon replace the ARMM that he has apparently steered well as a Malacañang-appointed helmsman to this corruption and violence-laden region.

PESO EXCHANGE RATES n US 44.6210

In the first 100 days of his caretakership of the ARMM, after the ruling Ampatuan clan were sent to prison for murder charges, he said the region saved P203.16 million, with P162 million of this coming after he “exorcised” ghost teachers and nonteaching staff, ghost buildings and other anomalous disbursements and transactions.

His caretaker administration was extended after his one-year tenure in 2012, and reports from his economic managers showed continued C  A

HE Aquino administration, aiming for “more efficient government spending,” is moving to kick-start vital projects and remove “bottlenecks” to drive economic growth in his last year, with underspending blamed for the less-than-expected 6.1-percent growth in 2014.

According to Deputy Spokesman Abigail Valte, the kick-starting measures include steps by the Department of Budget and Management (DBM) to get rid of “structural problems and bottlenecks” in implementation, as well as Administrative Order (AO) 46 signed by President Aquino in March.

Even as Valte conceded that the administration missed its target last year, she disputed reports describing Mr. Aquino’s 2014 economic performance as “dismal.”

“While it is true that the 2014 target was not met, we would not classify the 6.1-percent full-year GDP [gross domestic product] as dismal,” Valte told the BM.

The Palace official pointed out that, for this year, “strategic measures have been designed to allow for more efficient spending.”

Valte recalled that Malacañang’s AO 46, aimed to facilitate the implementation of programs and projects to achieve the administra-

tion’s economic and social goals.

“The DBM has also been implementing other budget reforms that would ease structural problems and bottlenecks in government spending,” she added.

Valte was responding to a query if the Palace is taking steps to reverse government underspending blamed for the Aquino administration’s failure to hit last year’s target.

ING Bank Manila economist Joey Cuyegkeng said on Tuesday that the low first-quarter government spending imparts a downside risk to the 6.6-percent consensus forecast in the first quarter.

S “G ,” A

n JAPAN 0.3671 n UK 69.0376 n HK 5.7564 n CHINA 7.1946 n SINGAPORE 33.2695 n AUSTRALIA 34.9749 n EU 48.9939 n SAUDI ARABIA 11.8989 Source: BSP (26 May 2015)

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BMReports BusinessMirror

Wednesday, May 27, 2015

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The price and ‘prize’ of peace in Mindanao. . .

economic upswing for what was supposed to be a regional group of the country’s poorest provinces of Maguindanao and Lanao del Sur in south-central Mindanao, and the southwestern island provinces of Basilan, Sulu and Tawi-Tawi.

P863M early 2015 investments in ARMM

Early this year alone, the ARMM Regional Board of Investments reported an investment already reaching P863 million, which could bring this year closer to becoming the third year that the region breached the P1- billion level since the 2011 level of investments of P1.6 billion.

In 2013 investors poured in P1.4 billion, half of it (P700 million) from nickel exploration in Tawi-Tawi, in real estate in Bumbaran, Lanao del Sur (P365 million), and in the expansion of a banana plantation and an oil depot.

In between, the regional administration conducted several new professional moves, from paying the

heavy indebtedness of the region to the Government Service Insurance System by P1 billion, to the first regional gathering of treasurers and finance officers for financial planning and management, to the conduct of cadastral surveys of 58 towns for purposes of benchmarking environmental data and the cleaning up of the list of agrarianreform beneficiaries to set in motion the stalled land distribution to farmers.

Nonetheless, the improved government operation would be eventually handed down to the new Bangsamoro entity, including the ARMM’s fiscal autonomous agencies that some senators and congressmen were wary about giving total operational responsibility to the Bangsamoro.

‘We are almost there’

“We are almost there,” Hataman said in a statement released by the ARMM’s Bureau of Public Information after the Congress committee passed the BBL on Wednesday

night. He hoped that the amendments notwithstanding,“will make for a better Bangsamoro basic law [BBL] that will entrench a genuinely autonomous region that is the best chance for peace and security in the south.”

He described the BBL as being “much debated and reviled by even those who have not read it,” but said it “is now closer to becoming a law by which we Moros will build the foundations of peace, security and progress.”

“It is a big leap forward,” he said, and urged the Senate to bring it down to the homestretch “in a race of hope, a race for peace.”

The BBL would provide the legal basis and governing matrix of the new Bangsamoro political entity, replacing the ARMM and covering a much bigger area to include, upon the decision of their local governments, the six municipalities of Lanao del Norte and the 39 barangays of North Cotabato.

The House of Representatives toned down the control of the

Govt all smiles after huge Calax yield. . .

MPIC President Jose Ma. K. Lim agreed, saying the delay gave his group a fresh lead time to review the prospects of the greenfield project and submit a very competitive bid.

“We have been observing the population growth in both Cavite and Laguna, and we believe it is higher than the national average.

There are about 3 million people in Cavite and 2 million in Laguna, so we did expect that, because of the delay, the traffic would probably start off at a higher level because of population growth,” he explained.

Commercial establishments and developments will also help spur traffic along the toll road, Lim added.

“In the meantime, we were able to do a more intense review of the cost estimates, which, we believe, went down—particularly steel and the petroleum-related components,” he said.

Yabut said the project is generally profitable, with a projected traffic of about 35,000

average daily vehicles passing through the expressway. “Calax will also spur development in potential growth areas. It is both a traffic and business generator,” he said.

These considerations, Lim said, allowed MPIC “to accept a slightly lower yield than” what it assumed in the previous bid.

At the first auction, MPCALA Holdings Inc. submitted an P11.33-billion premium bid, the second winning offer from Team Orion of Ayala Corp. and Aboitiz Equity Ventures Inc.’s P11.65-billion bid.

“The 20-percent bid premium is payable at the start and, therefore, the impact on overall profitability is somewhat muted by your aggressiveness of the bidding because it is spread out over 10 years basically,” Lim said.

Business groups congratulated the government for successfully generating revenues from the auction, but some are still doubtful and

Bangsamoro political entity of its “strategic resources” to only a consultation rather than the joint decision with the national government from the original BBL, one of the arguments some Congress representatives from the Makabayan bloc voted no to the BBL over its perception that it emasculated the Bangsamoro government instead of empowering it.

House panel lauded

While also reviled and accused as acting as spokesman for the MILF, government chief peace negotiator Prof. Miriam Coronel-Ferrer lauded the passage of the bill as a work of “due diligence [among House committee members] as they deliberated and voted on every section of the proposed measure, noting that substantive elements of the proposed law were retained in response to the call of the Bangsamoro people for genuine autonomy.”

Ferrer cited “three most substantive elements of the BBL [that] were

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carried in the amended draft of the ad hoc committee.”

“The important elements are still there, notably: the structure of government; automatic block grant; and the layered voting process where the majority vote in the six Lanao del Norte municipalities and 39 North Cotabato barangays shall be determined at the level of the local government unit.”

Coronel-Ferrer added that most articles, especially on fiscal and economic matters, were also preserved.

She said: “During the two-day proceedings, the ad hoc committee has entrenched certain substantial changes to the bill, such as the provision for the Chief Minister to have two deputies, one from the island provinces and another from central Mindanao; as well as the unequivocal recognition of the validity of the Indigenous Peoples’ Rights Act in the Bangsamoro. The latter has allayed the anxiety of the Lumad communities who have been clamoring for the same.”

“The welfare of the indigenous peoples has been enhanced. The same is true with the protection of women’s rights and welfare. While there were cutbacks on the jurisdiction of the Bangsamoro government over natural resources, the wealth-sharing from the exploration, development, and utilization of these resources were not changed,” Ferrer said.

“We welcome the approval of the draft [BBL] in the House Ad Hoc Committee,” Gus Miclat, executive director of the Initiatives for International Dialogue, said.

“This shows that our legislators can do their due diligence in listening to all the crucial stakeholders and in ensuring the constitutionality of the [BBL] within the timetable they set.”

“We are certain that our good senators can do the same,” Miclat added. “They have already conducted their consultations and have listened to key resource persons. We are sure these will all be reflected in the committee report, which we hope will be finalized soon.” To be continued

the lowest bidder would help reduce costs,” he said.

Lim said his group is happy with the turnout of the deal, which took two years to complete.

For his part, San Miguel President Ramon S. Ang said the results of the Calax bid is fine by him.

“There is no regret about losing the bid. I rarely regret making a losing bid,” he said.

The turnout of the rebidding was way above the first auction, which saw Team Orion topping the list of three qualified participants.

Ayala Corp. Managing Director John Eric T. Francia simply smiled when sought for comment.

His group decided not to participate in the fresh auction, signaling its dismay over the government’s decision for the rebid.

the P35.42-billion Calax in 2013 with the sole purpose of connecting the two Southern Tagalog provinces to decongest traffic and spur economic growth.

It was welcomed by the business community— particularly existing expressway operators— as the greenfield project showed great potential in the toll-road industry.

Four group were qualified to submit bids for the deal. They included: San Miguel Corp., Metro Pacific Investments Corp., Team Orion of Ayala Corp. and Aboitiz Equity Ventures Inc., and MTD Capital Bhd. During the bidding process, Optimal Infrastructure Development Inc. was disqualified due to a defective bid security.

Its risk guarantee was four days short of the required cover period.

The days went and the bids of the three technically compliant parties were opened.

Team Orion topped the bidding with a P11.65billion premium bid.

Metro Pacific’s MPCALA Holdings Inc. submitted a P11.33-billion premium offer, while MTD Capital Bhd. proposed to do the project at a P922-million premium fee to the government.

The process went smoothly, with government officials and business groups declaring the bidding “aboveboard” and “transparent.”

But, the food-to-infrastructure firm would not back down. Ang sought the intervention of Malacañang, declaring that it’s bid was way above the others at P20.1-billion premium.

It took the government quite sometime before finally deciding on the matter. Several petitions from Team Orion and Optimal reached the PPP Center, the Palace, and the public works department, both seeking to contradict each other’s position.

The two parties, however, came to a consensus that the road network was a pressing necessity, hence, Mr. Aquino should come to a conclusion.

He did. The Chief Executive called for the rebidding, voiding the clean and transparent tender that was launched in 2013. It now carried a floor price of P20.1 billion in premium.

This move received both the cheers and jeers of investors.

Four parties were interested in the rebidding of deal: San Miguel, Metro Pacific, and two others represented by different law firms.

The auction was met with a low turnout of bidders with only Optimal and MPCALA Holdings submitting their proposals.

Two other parties decided against the auction.

Calax is a 47-kilometer thoroughfare that will link the Manila-Cavite Toll Expressway and the South Luzon Expressway aimed at enhancing trade and socioeconomic activities in the region.

The private partner will take on the financing, design, construction, and operation and maintenance of the entire four-lane toll road.

The project will also include the construction of centralized toll plazas, a toll-collection system, viaducts and bridges.

The road should be operational by 2019, based on an indicative timeline.

The government has awarded nine contracts since the infrastructure program’s inception in 2010.

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critical over the rebidding as a whole.

Philippine Chamber of Commerce and Industry President Alfredo M. Yao said the turnout just showed the government made the right decision when it launched the rebidding.

“I think it proved us right. Now, the revenues were doubled, which is good for the country,” he said in a phone interview.

For his part, American Chamber of Commerce Senior Advisor John D. Forbes called on the government to complete this project sooner.

“We congratulate the winner and urge that Calax be built as soon as possible. No more delays on this and other high-priority transportation infrastructure projects, please,” he told the BusinessMirror in a text message.

The project is expected to be fully completed by 2020. Segments of the thoroughfare, however, will be opened after they have been constructed. European Chamber of Commerce

of the Philippines External Vice President Henry J. Schumacher said the rebidding was a clear win for the government, but a loss for the Filipino people.

“It is good for the government, but bad for Juan de la Cruz, who has to pay for the premium paid to government coffers. The bidding process used by the government is bad for the user of the infrastructure to be built,” he said.

Yabut defended the government’s decision, saying that the contract shields the common commuter from excessive toll rates that were earlier feared to be imposed due to the high premium requirement.

“The winner here is the Filipino people,” he said.“The initial toll rate was based on the study and is comparable to our existing expressways.

The base is P4.65 per kilometer, which is at par with other toll roads.”

But Schumacher was not convinced.

“Getting the best technical deal from

What went before?

The government launched the bidding for

The Nation BusinessMirror

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Business groups ask Aquino to implement ‘crucial’ reforms

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HE country’s largest local and foreign business groups on Tuesday recommended a mixed bag of “crucial” reforms for PresidentAquino to work on in his remaining months in office.

These range from improvement of business climate to resolution of good governance problems.

In a letter addressed to Aquino and made available to the media, Philippine Business Groups-Joint Foreign Chambers (PBG-JFC) bared a list of wideranging reforms that the 18 business groups deemed crucial to fulfill the current administration’s thrust of inclusive growth in its last year.

Topping the list is the appointment of government officials to posts that have been left vacant for several months and which the Aquino administration appears not in a hurry to fill.

These include posts in the Civil Service Commission, the Department of Energy and the National Police.

Other recommendations of the business groups include the creation of a public-private energy council to formulate an energy security and price competitiveness road map, the establishment of a National Privacy Commission, creation of agricultural trading centers, easing the process of establishing a business for the benefit of small and medium enterprises and revision of the foreign investment negative list to allow for more foreign participation in particular sectors.

Infrastructure improvement also made the business community’s priority list.

Notably, the among the reforms listed by the groups include suggestions of a political nature, such as speeding up the resolution of the Maguindanao massacre trial, and plunder cases against senators allegedly involved in the pork-barrel scam uncovered in 2013.

MMDA starts earthquake simulations

By Claudeth Mocon-Ciriaco Correspondent

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TARTING this week, the Metropolitan Manila Development Authority (MMDA) will conduct a simulation of a 7.2-magnitude earthquake in 72 barangays near the West Valley Fault.

MMDA Chairman Francis N. Tolentino sees the need to conduct the simulation, noting that Metro Manila is not yet prepared for a big earthquake and that the people should be able to feel how strong the tremor is.

The MMDA will bring its “mobile earthquake house” to the identified communities.

“We will prioritize those barangays that are near the West Valley Fault so that residents would feel the 6.9- and 7.2-magnitude quakes,” Tolentino said.

He said the earthquake house is a hydraulically operated facility, which resembles a bungalow. It can simulate seismic movements ranging from 4.0 to 8.0 magnitude.

In 2013 the MMDA unveiled its earthquake simulator called “Shake, Rattle and Learn House” and used it to educate the public about earthquake and its effects.

Tolentino, who is also the head of Metro Manila Disaster Risk Reduction and Management Council, said the simulation will raise awareness in barangays and schools about earthquakes.

The Philippine Institute of Volc a nolog y a nd Sei smolog y (Phivolcs) earlier said the 100-kilometer long fault line that passes through 42 barangays in Quezon City, Marikina, Pasig, Makati, Taguig, Muntinlupa and 30 barangays in Bulacan, Rizal, Cavite, Laguna, may cause a 7.2-magnitude quake.

According to Phivolcs, a 7.2-magnitude earthquake from the Valley Fault System would affect the entire Metro Manila, not just areas above or near the fault.

As a complement to the suggested policy directions, the PBG-JFC pushed for the immediate enactment of the following proposed legislations: Freedom of Information Act, Amendments to the Economic Provisions of the 1987 Constitution (Resolution of Both Houses 1), Private-Public Projects Act (BuildOperate-Transfer Law Amendments) and Amendments to the Right-of-Way Act (Republic Act 8974), Fair Competition Act, An Act creating the Department of Information and Communications Technology, Customs Modernization and Tariff Act and the Comprehensive Tax System Reform.

“The PBG-JFC holds that the Philippines possesses immense untapped potential that will be unleashed with the proper environment and policies in place. It is our common position that the enactment and implementation of the above measures will accelerate the country toward the progressive nation we all aspire to become,” the PBG-JFC said in the letter.

The signatory organizations include the Management Association of the Philippines, Makati Business Club, Semiconductor and Electronics Industries in the Philippines, Employers Confederation of the Philippines, IT and Business Process Association of the Philippines, Federation of Filipino-Chinese Chambers of Commerce and Industry, Alyansa Agrikultura, Philippine Exporters Confederation Inc., Chamber of Mines of the Philippines, Philippine Chamber of Commerce and Industry, Financial Executives Institute of the Philippines, American Chamber of Commerce, Australia-New Zealand Chamber of Commerce, Canadian Chamber of Commerce, European Chamber of Commerce, Japanese Chamber of Commerce and Industry, Korean Chamber of Commerce, Philippine Association of Multinational Companies Regional Headquarters. Catherine N. Pillas

Thailand, Manila AOCs want full, immediate Clark airport development

By Ashley Manabat Correspondent

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LARK INTERNATIONAL AIRPORT—The Thailand and Manila Airline Operators Councils (AOCs) have joined the growing clamor among local stakeholders in Northern and Central Luzon for the immediate and full development of this airport.

In an appeal to President Aquino, the AOCs said it is backing the move for the full and immediate development of the Clark International Airport (CIA) so as to attract more airlines and tourists to visit the Philippines.

Louise Moser, chairman of the Bangkok AOC, said, “The development of Clark International Airport is a vital importance to traffic growth, as well as to lure more tourists to visit the country.”

He said, “The AOC Thailand will give its all-out support in seeing Clark International Airport’s further expansion.”

Moser made the statement during the group’s visit here as he made an urgent appeal to President Aquino for its full utilization.

President Larry Isidro and Chairman Leoncio Dakila Nakpil of the Manila AOC and a member of the Asean (Association of Southeast Asian Nations) AOC also called on President Aquino for the full and immediate development of this airport.

“We would like to bring everybody closer in the spirit of Asean cooperation and one of which is to encourage airlines to operate in Clark because all of the potentials are here,” Isidro said.

He added that the Ninoy Aquino International Airport in Manila is now heavily congested and that they want to sell Clark as the growing international gateway to the Philippines.

Meanwhile, Moser said he was impressed by the developments at this airport since his last visit 10 years ago.

“I am very much impressed and commend [the Clark International Airport Corp. (Ciac)] management headed by its President and Chief Executive Officer Emigdio Tanjuatco III for a job well done,” he said.

Moser said Thailand has also an airport that used to be a US military air base that is now being considered for conversion into a civil aviation complex.

For his part, Tanjuatco also thanked the group for its support to the CIA and urged it to consider Clark airport for their operations so as to have more flights.

“This visit is very important for Clark airport and we are currently engaging ourselves in an aggressive marketing campaign to further promote the development of this airport,” Tanjuatco told the Thailand and Manila AOC members during a briefing at the Ciac Boardroom.

Tanjuatco also said Ciac is constantly engaging a dialogue to several stakeholders such as the airlines, tourism councils and local government units, telling them that Clark airport is open for business.

“We are inviting more stakeholders to participate in the business of Clark and, most especially, the airlines,” he said.

Tanjuatco also said he will invite Thailand air carriers to consider Clark airport by launching additional routes in order to contribute in the development of the airport.

“Once I get back to Thailand, rest assured that I will convey my invitations to them [airlines] to take a look at Clark airport,” he said.

At present, there are only six airlines operating in this airport: Qatar Airways with daily flights to Doha, Dragonair with three flights weekly from Hong Kong, Asiana Airlines with daily flights from Seoul, Air Asia Berhad with four flights weekly from Kuala Lumpur, Jin Air with daily flights from Seoul, and Tiger Airways with daily flights from Singapore.

Editor: Dionisio L. Pelayo • Wednesday, May 27, 2015 A3

Alarming levels of mercury vapor detected in dental clinics, schools

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EVERAL dental clinics and schools offering dental education have been found to have alarming levels of mercury vapor, a study conducted by the International Association of Oral Medicine and Toxicology (IAOMT) and BAN Toxics (BT) revealed.

T he st udy t it led “ L a son Sa Hangin: Mercury Vapor Levels in Dental Schools” was presented in a news conference on Tuesday to warn authorities of the health hazards posed by the continued use of dental amalgam that contains the toxic substance.

The study reveals the high level of mercury vapor in dental schools, with measurements ranging from 183.5 µg/m3 to a high >30,000 µg/ m3, depending on variables, such as the architecture of the facility, the weather and the number of dental restorative procedures.

Overall, each site yielded figures much higher than the recommended Agency for Toxic Substances and Diseases Reg istr y minimal risk level for inhalation exposure at 200 µg/m3 and the action level of 1,000 µg/m3, which

triggers remediation if exceeded in indoor air.

The study was conducted in the dental restorative areas of four dental colleges around the country through BT’s Lumex Ra-915+ Hg vapor analyser, which measured mercury vapor levels over an eighthour period, simulating a typical workday for dental professionals and students. “ The results are not surprising. Our previous research has already shown that dental amalgam releases a significant amount of mercury vapor. W hat’s more troubling is how it is continually being overlooked,” IAOMT-Philippines Executive Director Lillian Lasaten-Ebuen said.

Dental-amalgam fillings are valued because these are supposed to be durable, inexpensive and easier to ma-

nipulate, Lasaten-Ebuen said.

However, as the dental restorative material is composed of 50percent mercury—toxicologists and researchers have warned of its potential effects not only on patients but also on dentists and dental staff, as well, she said.

“Government regulators need to be consistent in its policy on mercury. If we are banishing it from use in hospitals and health-care facilities all over the country, as well as prohibiting its use in small-scale gold mining, the dental sector remains the lone and illogical exception,” Myline Macabuhay, BT Chemicals Management assistant coordinator, said for her part.

Some dentists continue to use dental amalgams and dentistry schools continue to follow what the groups described as “a flawed curriculum that requires students to practice and hone their skills via dental-amalgam restorations.”

“We need to review antiquated processes, especially those that pose harm to the environment and health, and move forward with practical and preferably toxic-free options for Filipinos. Philippine dentists and dental schools need to reevaluate their duty of care to patients and students, and phase out dental-amalgam use immediately,” Macabuhay added.

Economy

A4 Wednesday, May 27, 2015 • Editors: Vittorio V. Vitug and Max V. de Leon

BusinessMirror

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Senate version of Timta to include T cost-benefit analysis on incentives

PCCI backs PHL-Chile FTA

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By Catherine N. Pillas

he Ways and Means Committee of the Senate has proposed amendments on the Tax Incentives Management and Transparency Act (Timta), which include the conduct of costbenefit analysis on investment schemes.

Under the amendment, the National Economic and Development Authority (Neda) is mandated to conduct an annual cost-benefit analysis on the investment incentives to determine the impact of tax incentives on the economy.

“This will allow policy-makers to make better decisions in crafting or revising laws; in overseeing the implementation of existing investment-related laws; and in managing the nation’s finances,” said Sen. Juan Edgardo M. Angara, committee chairman and sponsor of the Timta bill.

All heads of the investmentpromotion agencies (IPAs) must submit to the Neda investmentrelated data, which will include the list of registered business entities, investment projects, investment cost, actual employment and ex-

port earnings. For tax incentives data, the Department of Finance (DOF) will furnish Neda a copy of the reports submitted by the Bureau of Internal Revenue (BIR) and the Bureau of Customs.

As for the monitoring of tax incentives information, Angara proposed an amendment mandating the DOF to submit to the Department of Budget and Management (DBM) the following data: actual amount of tax incentives availed by registered business entities; estimate claims of tax incentives immediately preceding the current year; programmed tax incentives for the current year; and the projected tax incentives for the following year.

The Department of Trade and Industry and the country’s various IPAs have opposed the said provision during a House of Representatives

hearing last week and questioned the authority of the DOF to project tax incentives.

For transparency purposes, the data and information will be reflected by the DBM in the annual Budget of Expenditures and Sources of Financing (BESF), which would be known as the Tax Incentives Information (TII) section.

Angara said in a statement that the TII will be limited to the aggregate data related to incentives availed of by registered business entities based on the submissions of the DOF and the concerned IPAs, categorized by sector, by IPA and type of incentive.

T he DBM w i l l subm it t he BESF to the President and to the chairmen of the committees on Finance and Appropriations of the Senate and the House of Representatives, respectively.

“The proposed Timta does not, in any way, diminish or limit the amount of incentives that IPAs may grant pursuant to their charters and existing laws, or prevent, deter or delay the promotion and regulation of investments, processing of applications of registrations and evaluation of entitlement of incentives by IPAs,” Angara said.

Penalties for noncompliance with reportorial and filing requirements were also amended, wherein repeated violations will be penalized with the

cancellation of the registration of the business entity.

Meanwhile, any government official or employee who fails to provide or furnish data or information as required under this law will also be penalized.

All proposed committee amendments, which are mostly based on the DTI-DOF agreed version on Timta, were approved in the plenary, and the senators will then propose their individual amendments before voting for its approval on second and third reading.

“Fiscal incentives cannot be evaluated in a vacuum. We need to better monitor the fiscal incentives we give to ensure that the revenue we forgo actually leads to more investments and high-income jobs,” Angara said.

The House of Representatives’ version of Timta is based on the Senate version, and no major differences have thus far been introduced by either chamber. However, House Committee Chairman for Ways and Means Rep. Romero S. Quimbo has spoken out against the Board of Investments’ (BOI) authority to validate incentive claims.

In a hearing last week, Quimbo aired his intention to remove the power of the BOI to validate incentive claims of its registered enterprises, suggesting the validation of incentive availment given to the BIR.

he Philippine Chamber of Commerce and Industry (PCCI), the country’s largest business organization, is backing the establishment of a free-trade agreement (FTA) between the Philippines and Chile.

Negotiations for the FTA are expected to kick off in November this year, during the state visit of Chilean President Michelle Bachelet Jeria.

Chilean Vice Minister for International Trade Andres Rebolledo last Tuesday met with PCCI President Alfredo M. Yao wherein mutual hopes for a swift creation of the FTA were expressed.

In a statement, Yao said he hopes for a quick establishment of a bilateral FTA, as consultations have already begun between the Department of Trade and Industry (DTI), and its Chilean counterpart.

Yao hoped that there may be a

gradual phasing out period when it comes to tariffs or subsidies, considering that Chile has an open economy.

He said he hopes that progress on other areas such as investments, standards on labor and environment, and competition rules will be “quick.”

Yao said negotiations for the bilateral pact between governments of Chile and the Philippines could be launched by the time the president of Chile makes a state visit to the country for the Apec leaders’ meeting in November.

Jeria would be accompanied by a delegation of Chilean CEOs eager to seek partnerships with Filipino business partners, Yao said.

According to data from the DTI, total bilateral trade between the Philippines and Chile declined to $72.73 million from $133.27 million. The Philippines enjoyed a trade surplus of $17.44 million in 2014.

Catherine N. Pillas

Malaysia, Canada keen on boosting trade ties with PHL

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rade missions led by officials from Malaysia and Canada arrived in the country in a bid to boost trade ties with the Philippines.

Following the Asia-Pacific Economic Cooperation ministers responsible for trade meeting in Boracay, the trade ministers of Canada and Malaysia led their respective trade missions in Manila to explore business opportunities in the Philippines.

The Malaysian business delegation—composed of 32 Malaysian company executives—expressed interest in health-care services, the information communication technology, food and beverage,

and solar energy sectors.

Malaysia’s Minister for International Trade and Industry Dato Sri Mustapa Mohamed underscored the importance of “closer convergence” of small and medium enterprises (SMEs) of both nations, during the trade and investment mission in Fairmont Hotel.

“We are encouraging small and medium enterprises [of Malaysia and the Philippines] to work together, specifically in the sectors of information and communication technology, it’s important to work together for SMEs,” Mohamed said.

Similarly there is strong, mu-

tual interest from Filipino companies to keep investing in Malaysia, said Mohamed, as evidenced by business magnate Ramon S. Ang’s continued expansion plan for Petron Malaysia, and another Philippine-based foodand-beverage company that is eyeing to make Malaysia its regional production hub.

Ma laysia’s big-ticket investments were in the Philippine manufacturing sector in the years 2010 to 2014, accounting for 56.3 percent of total inflows. Malaysian firms have also invested in the country’s construction sector, water supply, electricity, gas and steam sectors, and support services.

Total bilateral trade between Malaysia and the Philippines amounted to $5.26 billion in 2014, an improvement of 17.8 percent over 2013’s total two-way trade of $4.47 billion.

Meanwhile, Canada’s Minister for International Trade Ed Fast, said Ottawa sees potential in the Philippines’s

infrastructure, transportation, agrifood processing and sustainable technology sectors.

Fast, however, said that, while the Philippines and Canada are moderately healthy—estimated at $1.8 billion in 2014—it can increase more rapidly with a free-trade agreement (FTA) in place, hence the preliminary talks on one.

“We said that in order to significantly rapidly increase our bilateral trade, we believe that exploring a free-trade agreement makes a lot of sense, there’s a high degree of complementarity between the Philippines and Canada’s economies.

My goal is to see our trade grow much faster from the past growth,” Fast said.

A bilateral FTA with Canada is seen as an option for the Philippines to access the markets of Mexico and the United States, as Canada has concluded an FTA with these two countries.

Catherine N. Pillas

PAYING IN KOREAN WON

A gasoline station in Baguio City uses pumps that display the cost of fuel in Korean won. Most oil companies in the country implemented an increase of P0.50 per liter for gasoline but rolled back the price of diesel by P0.50 per liter. NORIEL DE GUZMAN

US govt agency to inspect Naia

By Recto Mercene

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he Transportation Security Administration (TSA), a US government agency mandated to conduct security assessments of airports worldwide, is set to inspect the Ninoy Aquino International Airport (Naia) starting May 27, according to the airport media information.

The TSA performs regular security assessments of airports that host airlines with flights to the US. The TSA wants to ensure that the safety standards set by the International Civil Aviation Organization is being followed.

The auditing team will check airline operations, including that of their respective ground handlers, from Wednesday to Friday, the Media Affairs Division said in a statement.

Those participating in the inspection are Cathay Pacific, Philippine Airlines, EVA Airways, United Airlines, UA Cargo, Federal Express, United Parcel Service Clark, Delta, Miascor, Sky Kitchen Philippines Inc. and PAL Cargo.

An assessment of Naia operations will then take place from June 1 to 3.

This will cover systems relative to terminal and ramp access control; security screening; quality control; the airport perimeter; the command center; and

HONRADO: “It was November 2013 when the TSA last inspected Naia [Ninoy Aquino International Airport].

The results from which showed that the airport meets international standards.”

aircraft and cargo operations.

The team is expected to start collating their findings on June 4.

Manila International Airport Authority (Miaa) chief Jose Angel Honrado said he is confident that Naia will pass the inspection, given its management’s continuous efforts to ensure passenger security at the airport.

“It was November 2013 when the TSA last inspected Naia. The results from which showed that the airport meets international standards. Miaa maintains a positive disposition that the airport will again pass the inspection,” Honrado said.

He added that the airport management continues to enhance security measures for passengers. Among other projects, new body scanners are expected to arrive next month, while more CCTV cameras are to be installed next year.

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Economy BusinessMirror

Low inflation to continue boosting consumption

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ow commodity prices are expected to drive consumption spending for the rest of the first semester this year, according to First Metro Investment Corp. (FMIC) and University of Asia and the Pacific (UA&P) Capital Market Research.

In the latest Market Call, FMIC-UA&P Capital Market Research said inflation has remained benign at 2.4 percent by the end of the first quarter and even lower at 2.3 percent in April.

The low prices can boost household spending, increasing the chances of growth reaching around 6.5 percent in the first quarter, which could continue in the first semester.

“Consumption spending would likely improve from last Q4 [fourth quarter] as the fall in inflation rates is likely to continue for the rest of H1 [first semester]. This should convince consumers that the gains in purchasing power are relatively permanent, and thus encourage them to hike spending in H1,” FMIC-UA&P Capital Market Research said.

The think tank also said that, with benign inflation, the central bank will likely maintain, or even soften, its monetary-policy stance toward the end of the January-toJune period.

FMIC-UA&P Capital Market Research estimates that given inflation rates at the low end of target and money growth below 10 percent, “the BSP [Bangko Sentral ng Pilipinas] will take a long pause in its monetary-tightening cycle until early 2016.”

On the other hand, the think tank said weak exports in the first quarter only reflected the slowdown in the growth of the US economy on the back of a “very harsh winter.”

FMIC-UA&P Capital Market Research, however, believes this will

likely rebound in the second quarter and continue to improve for the rest of the year.

Exports posted a contraction of 0.2 percent in the January-to-March 2015 period. The country’s export earnings only reached $14.247 billion in 2015, from $14.277 billion in 2014.

“Slowing growth in Japan, China and the European Union appeared to dampen export demand. Exports growth in the first two months of the year showed to be lackluster, thus we believe that exports may post a moderate single-digit growth in H1 [first semester],” FMIC-UA&P Capital Market Research said.

Earlier, state-owned think tank Philippine Institute for Development Studies (PIDS) said the economy can post a growth of about 6.8 percent this year on the back of strong household and government spending.

However, this is below the government’s 7-percent-to-8-percent growth target for 2015 and 2016. The PIDS said a growth of 7 percent may not be possible, unless the government pursues policy reforms.

These policy responses include ensuring the reliability of power supply and transportation infrastructure, as well as facilitating the transmission of resources from the financial to the real sector.

The PIDS added that both the private and public sectors must take advantage of the low oil-price regime.

This can open doors for company expansion in the private sector and controversial moves, such as higher taxes, for the public sector.

The National Economic and Development Authority earlier urged businesses to capitalize on this and expand their operations due to cheap oil prices.

Cai U. Ordinario

Mindanao IP Desk to promote development of ancestral lands

By Mary Grace Padin

Special to the BusinessMirror

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NTERNATIONAL Alert, in partnership with the National Commission on Indigenous Peoples (NCIP) and the Mindanao Business Council (MinBC), launched on Tuesday the Mindanao Indigenous Peoples (IP) Desk, which aims to build sustainable collaboration and prevent conflict between investors and IP communities in the region.

The Mindanao IP Desk is the first initiative in the country that promotes the development of ancestral lands in Mindanao through economic investments, while still protecting the rights and the practices of the IPs that will be affected by the projects.

Francisco J. Lara Jr., country manager of International Alert Philippines, stressed the importance of tripartite partnerships between the IPs, investors and the local government units (LGUs) in ensuring investments in the provinces are inclusive and conflict-sensitive.

“We hope this initiative will address effectively the conflicts that emanate from investments made in the countryside,” Lara said.

Representatives from major business corporations and IPs are present in the launch.

International Alert Philippines Deputy Country Manager and Head of Mindanao Operations Nikki Philline dela Rosa said the IP Desk is already operational but is still a work in progress, as they are still finalizing a technical working group that will oversee all the services to be offered. This team will be comprised of the International Alert, NICP, MinBC, LGUs, government agencies and civilsociety groups.

Investors can approach the IP Desk in different MinBC offices in the region for consultation on the proper approach on establishing businesses in ancestral domains.

The IP Desk will offer guidance on securing “free prior and informed consent”

from IP groups, facilitation of dialogues and training on conflict sensitivity.

They can also access the database on IPs, such as the Resource Use and Management Plan, or the assessment of each IP’s resources, mapping out which of their land can be used for commercial purposes or which are their residential and sacred grounds.

Likewise, IPs can have their concerns addressed through their representatives in the Mindanao IP Desk.

The Mindanao IP Desk is a result of a project funded by the European Union called “Strengthening Inclusive and Conflict Sensitive Governance of Ancestral Lands through Indigenous People, Local Government and Business Sector Partnerships.”

The project helped IP groups in gaining confidence in dealing with business and government through its training and capacity strengthening programs.

MinBC Executive Director Rolando Torres was present in the launch to explain the challenges of investors, who come to Mindanao for new business ventures.

He listed access to information, lack of understanding on IP culture and tradition and security.

He also said it is a challenge for investors how to regain the trust of IP communities, given the bad experiences they experienced in the hands of investors in the past—investors who resort to pay-offs, investors who by-pass the necessary process in gaining permits and the destruction of ancestral properties.

“A lot of investors pay from the sins of the past,” Torres said.

Augusto Blanco Jr., IP mandatory representative in the Sangguniang Panlalawigan of Compostela Valley, also told the IPs’ side on the launch of the IP Desk.

“I think information should be twoway. Investors should know what their investments would mean to the community, and IPs should understand what these investments would mean to them,” he said.

Wednesday, May 27, 2015 A5

Imports contracted 4.1% in Q1

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By Cai U. Ordinario

he continued decline in oil prices caused the country’s first-quarter import receipts to contract 4.1 percent, according to data released by the Philippine Statistics Authority (PSA) on Tuesday.

In the latest External Trade Performance report, the PSA said import receipts reached $15.682 billion in the January-to-March period, lower than the $16.348 billion in the first three months of 2014.

In January 2015 imports posted a contraction of 13.1 percent. In March imports fell 6.8 percent. In February, however, imports posted a growth of 10.2 percent.

“Of the major commodities that caused the decline in the country’s imports, inward shipments of Mineral Fuels, Lubricants and Related Materials showed a remarkable 47.3-percent decrease [an equivalent of $611.86 million] in the same month of previous year’s level,” the PSA explained.

Economic Planning Secretary Arsenio M. Balisacan said oil imports reached $681.3 million in March 2015, from $1.3 billion in the same period last year.

Balisacan, who is also National Economic and Development Authority (Neda) director general, said global oil prices are still below the

$100-per-barrel mark at $51.6 per barrel in the first quarter of 2015.

“The low price of oil prompted an increase in the overall volume of imported crude by 47.8 percent. It is expected that the increase in energy demand during the summer season will further drive imports of petroleum products,” Balisacan added.

Balisacan said the manufacturing and utilities subsectors of the economy that are reliant to oil-based inputs will benefit from the low oil prices.

He said that, based on the latest PSA data, payments made to imported raw materials and intermediate goods contracted 1.1 percent to $2.09 billion, from $2.11 billion in March last year.

Balisacan noted that this was reflected in the strong decline in the imports of semiprocessed raw materials, which contracted 6.2 percent.

“The drop in the imports value for semiprocessed raw materials can be attributed to decreasing prices of raw materials, a trend

which has been occurring for five consecutive months since November 2014,” Balisacan said.

PSA data showed that imports of electronic products, the country’s top import, grew 14.1 percent to $4.677 billion in the first quarter, from $3.837 billion in the same period last year.

This was largely due to the import of Components/Devices, or Semiconductors, which posted a growth of 10.3 percent to $3.325 billion in the January-to-March 2015 period, from $3.015 billion in the first quarter last year.

In March 2015 imports of electronic products grew 5.4 percent to $1.271 billion, from $1.207 billion in March 2014.

Among the major groups of electronic products, Components/Devices (Semiconductors) posted the biggest share of 18.4 percent, and grew by 1.2 percent, that is $939.41 million in March 2015, compared from $928.42 million in March 2014.

The top 3 import sources of the Philippines in March 2015 were China, which accounted for a 12-percent total import receipts, followed by the US, including Alaska and Hawaii, with 10.7 percent; and Japan, including Okinawa, with 8.7 percent.

Imports from China reached $614.70 million, a decrease of 27.2 percent from $844.11 million in March 2014.

Shipments from the US amounted to $547.34 million, which increased by 30.8 percent from $418.61 million in March 2014.

Imports from Japan were valued at $445.20 million. It increased by 10.5 percent, from its March 2014 value of $402.99 million.

P-Noy asked to include pay hike for state workers in 2016 budget

By Jovee Marie N. dela Cruz

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lawmaker on Tuesday urged President Aquino to include salary hikes for state workers in the proposed 2016 budget.

ACT Teachers Rep. Antonio Tinio said President Aquino should grant the long-delayed salary increases to the country’s 1.6 million government employees, including public school teachers.

“It’s now or never. President Aquino has one last chance, through the last budget proposal of

his administration, to grant the much-needed pay hikes to government employees. It’s been three years since the last increase. He must do it now,” he said.

The term of the President will end in June next year. He is also expected to present his proposed 2016 budget to Congress in July after the State of the Nation Address.

“The President can expect a smoother opening of classes if he announces that the budget next year will contain the pay hikes that public school teachers have long needed and demanded.”

Tinio said per his estimates, his proposal of minimum monthly salaries of P25,000 and P16,000 for public school teachers and other government employees, respectively, will entail at least P142.5 billion in additional budget. Nearly P50 billion will be for teachers.

“What’s P142.5 billion compared to the hundreds of billions in pork-barrel funds at the President’s disposal? At least we can be sure that salary increases will directly benefit civil servants and their families and not go to the pockets of corrupt politicians,” Tinio added.

A6 Wednesday, May 27, 2015

Opinion BusinessMirror

editorial

Territory: Are China’s claims valid?

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he Aquino administration has taken some comfort in the fact that the United States is pushing China by asserting its right to travel in and near areas claimed by the Chinese.

However, a study by the Center for Naval Analyses (CNA) in November 2014 may have been ignored or is unknown to our government. This report, “The South China Sea: Assessing US Policy and Options for the Future,” has never been mentioned by either the administration or by the local press or media.

The CNA, established in 1942, is a US government-funded think tank providing research and analysis for decision-makers on matters related to the oceans and naval operations. While the report does “not necessarily reflect the views of the CNA or the Department of the Navy,” this is what is being read by Washington, D.C., policy-makers. The analysis and its conclusions are disturbing.

Regarding the Philippine-US Mutual Defense Treaty, “If China were to attack a Philippine naval vessel, shoot down a Philippine military aircraft, or kill or wound members of the Philippine armed forces, treaty language related to attacks suggests that the treaty would apply.”

Using the word “suggests” clearly implies that it would be up to the US to decide whether a Chinese attack on Philippine military assets would justify US involvement. That is not comforting.

Further, the report states this regarding the territorial claims. “The claims of the Philippines, Malaysia and Brunei to islands or rocks in the Spratly Islands are not as strong as the claims of either China or Vietnam.” Further, “the State Department should conduct a legal analysis of the Philippine claims. If this analysis reaches the same conclusions as the analysis prepared for this project, Manila should be quietly informed of Washington’s opinion of its claims, particularly in the Spratlys.” That is not comforting either.

But the Philippine government has taken the territorial issue to international arbitration.

On this, the report states, “US officials have publicly supported the Philippines’s request for arbitration, but if the tribunal rules that it does not have jurisdiction, it will be a major setback to hopes that international law can be the basis for shaping the behavior of parties involved in the South China Sea disputes.”

The Department of Foreign Affairs, to the best of our knowledge, has never said that the International Permanent Court of Arbitration might not even hear the case. What is the government’s “Plan B” if the dispute does not go to arbitration?

The report is 100 pages long and supports some of the Philippine claims, including the Reed Bank, the Scarborough (Panatag) Shoal and the Mischief Reef. But it also says, “From its perspective, China resolved the sovereignty dispute with the Philippines over the Scarborough Shoal in 2012, when it established control over the shoal. The US is not going to become involved in any attempt to expel the Chinese.”

The issue is obviously complicated and the Philippine government is taking the actions it thinks are appropriate. But are expectations of success too high and, more important, is the government being transparent about the details?

Pursuing social-security coverage of Filipinos overseas Susie G. Bugante

All About Social Security

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ven before John Naisbitt, author of the 1982 blockbuster book Megatrends, said that there will be migration of workers from North to South and vice versa, the phenomenon of Filipino diaspora to job-rich countries had already begun a decade before.

For the past 40 years, labor migration from the Philippines continued to grow each year, with figures doubling over the last 10 years. Today around 12 percent of the country’s population are overseas, either as land-based or sea-based workers.

According to the 2013 Country Migration Report, published by the International Organization for Migration, “for many years, the Philippines has figured among the top countries of origin in the traditional immigration countries”: the top 4 of which are the United States, Saudi Arabia, the United Arab Emirates (UAE) and Canada.

In response to this phenomenon, the Social Security System (SSS) since 1992 has pursued the socialsecurity coverage of overseas Filipino

workers, albeit on a voluntary basis.

Representative offices were set up in places like Brunei; Kuala Lumpur, Malaysia; Hong Kong; Macau; Taipei, Taiwan; Singapore; Abu Dhabi, UAE; Bahrain; Doha, Qatar; Dubai, UAE; Kuwait; Saudi Arabia (Riyadh, Al-Khobar and Jeddah); Italy (Milan and Rome); and London, United Kingdom, to bring SSS services closer to Filipinos abroad.

Some countries are more open to forging bilateral agreements with the Philippines for the purpose of promoting mutual cooperation in the field of social security, for the benefit of their respective nationals and the Filipino workers. This is one tack that is strongly being followed by the SSS management in providing social-security protection to Filipino

workers wherever they may be. Since 2012, four countries have signed bilateral Social Security Agreements (SSAs) with the Philippines, namely, Denmark (signed on September 11, 2012); Portugal (signed on September 14, 2014); Germany (signed on September 19, 2014); and Luxembourg (signed on May 15, 2015).

The first two have been ratified

by President Aquino and have been transmitted to the Senate for concurrence to the presidential ratification as required under the Philippine Constitution. The next two will be submitted to the President for ratification, and then transmitted to the Senate for concurrence.

Soon to be signed are SSAs with Sweden and Japan, which are expected to be done within the second semester of 2015.

The salient features of these SSAs include: a. Equality of treatment—A covered Filipino, including his/her dependents and survivors, shall be eligible to social-security benefits under the same conditions as the nationals of the host country. b. Export of benefits—A person shall continue to receive his/her benefits wherever he/she decides to reside. c. Totalization—Contributions/ creditable periods in both countries

China’s growing meth addiction Adam Minter

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BLOOMBERG VIEW

n the summer of 2013, a 50-year-old chemistry professor in the Chinese province of Xi’an apparently decided to emulate Breaking Bad. Teaming up with a Mr. Chen, Professor Lu (full names haven’t been released) straddled between his classroom duties and a growing methamphetamine business—at least until last week, when law enforcement swept down on the pair and their employees, seizing 128 kilograms of finished product, more than 2,000 liters of semifinished product, and 5 million yuan in cash (approximately $806,000). As of a week ago, their sales network, which stretched across China, is no longer in operation.

Lu’s was a short, spectacular run at one of China’s fastest-growing business opportunities: the manufacture of methamphetamines and other synthetic drugs.

According to data released last week

by China’s National Narcotics Control Commission, China was home in 2014 to 14 million drug addicts (a number that the agency acknowledges is a serious undercount). Of these, 2.955 million are registered with government agencies (for the purpose of treatment and monitoring by public agencies, including law enforcement), and more than half —1.459 million—were recorded as users of methamphetamine. According to the government, the ranks of synthetic drug users are growing 36 percent every year.

Of course, China isn’t the only country that has struggled to deal with a drug epidemic. But there are several reasons meth will likely prove to be an especially stubborn scourge for the Chinese government.

The first problem is easy supply.

China is one of the world’s largest manufacturers of the chemical precursors necessary to make licit and illicit drugs.

China tries to strictly control the distribution of these chemicals, but ambitious meth entrepreneurs can often find crooked chemical and pharmaceutical factories that are willing to evade regulations. Directly sourcing large volumes of ingredients allows meth producers to produce large batches and benefit from economies of scale.

In that way, it’s no accident that

Guangdong Province, home to the bulk of China’s chemical industry, is also home to some of its biggest methamphetamine busts. In January 2014, for example, 3,000 paramilitary and police descended on a village of 14,000 devoted to meth production, where they shut down 77 meth labs and seized more than 100 tons of meth-making ingredients.

China is also dealing with a complicated demand problem. Consider Guangdong, which has some of China’s highest rates of methamphetamine use.

(That’s according to an innovative 2014 study that measured illicit-drug levels in the sewage of major Chinese cities and found meth “in every single sample analyzed.” The provincial government’s data confirm the high rate.)

What differentiates Guangdong from other parts of China? Li Xiaodong, a member of the board of the China Association of Drug Abuse Prevention and Treatment, has suggested that the province’s high rates of drug use are linked to its high rates of migrant labor. (The area attracts tens of millions of laborers every year from other parts of China.)

Li recently told the South China Morning Post that more than 60 percent of Guangdong’s drug users were originally from other provinces, and it’s not hard to imagine why that group might find its way to drugs. Migrants often lead lonely lives—many leave their families behind when they set off to find work—and they’re said to suffer from high rates of depression.

Studies suggest that migrant labor

shall be added (excluding overlaps) to determine qualification for benefits. d. Payment of benefits—Both countries that are party to the agreement shall pay a fraction of the benefit due from their respective systems, in proportion to the actual contributions/creditable periods. e. Mutual administrative assistance—Covered members or beneficiaries may file their claims with the designated liaison agencies of the Philippines or the host country, which shall accordingly extend assistance to facilitate processing of claims.

At present, the Philippines has bilateral agreements on social security with the following countries: Austria (effective April 1982); the United Kingdom/Northern Ireland (September 1989); Spain (October 1989); France (November 1994); Canada (March 1997); Quebec (November 1998); Switzerland (March 2004); and Belgium (August 2005).

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.

also takes a toll on the family members who are left behind. Studies have shown that China’s biggest base of drug users is the country’s poor rural youth. According to a 2011 report in the Global Times newspaper, 87 percent of rural Chinese drug users were under the age of 35, including many whose migrant laborer parents were no longer at home. (Meanwhile, a handful of studies and plenty of anecdotes suggest that drug use—especially cheap drugs like meth—is on the rise among working-class Chinese more generally. In 2012, for example, a fatal truck crash caused by a meth-using driver inspired the national authorities to drug-test truck drivers nationally and suspend more than 1,400.)

The government has made efforts to push back against these trends. Under President Xi Jinping, the Chinese government has undertaken a very public campaign against recreational drug use. In 2014 the Narcotics Control Commission claims that law enforcement “cracked” 146,000 drug-related cases, convicted 109,000 drug-related suspects and seized 69 tons of “illegal substances.” And the government has also undertaken prosecuted celebrities, including the son of film star Jackie Chan, on drug charges.

But laudable as these efforts are, they don’t address the root of China’s methamphetamine problem. The country’s growing demand and near endless supply for meth production means that, for the foreseeable future, there will likely be many more people vying to become the country’s next Walter White.

Opinion BusinessMirror

opinion@businessmirror.com.ph

Voice of civil society muffled in post-2015 negotiations for better future

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By Esmee Russell | Inter Press Service

ONDON—In September the United Nations will agree on new Sustainable Development Goals (SDGs), which will set development priorities for the next 15 years. The draft goals that have been developed are ambitious—they seek to end poverty and ensure no one is left behind.

Until now, civil society has been engaged in discussions over goals and targets; through national consultations and UN hearings. As End Water Poverty (EWP), a global civil-society coalition of over 280 organizations worldwide, we campaigned for a post2015 world where we see the end of inherent systemic inequalities and the full realization of the human right to water and sanitation.

Through these opportunities, member-states heard our call; that water and sanitation is a fundamental aspect of all development and a key priority to address in order to improve our future. Together as a united civil society, we achieved securing a dedicated water and sanitation goal—goal 6—and welcome this progressive advancement.

However, there is still much work to be done. The only way to make this goal an achievable global reality is to have effective, inclusive indicators that can be monitored. This critical need has not been met.

To date, the discussions around indicators have been led by technical experts behind closed doors, without input from other stakeholders. The voice of civil society has not been heard.

This is despite the UN stating the setting of the post-2015 agenda will be fully inclusive of all stakeholders. The time to act is now. Civil society has to stand united to call for a positive future; one that prioritizes improving the lives of those most in need.

EWP is calling to ensure that space is created for civil society to be an important contributor in these processes, particularly in the critical stage of developing indicators.

A participatory approach is essential, as it leads to effective and sustainable interventions based on the real needs of communities.

We must hold the UN accountable to fulfill its promise that the next development framework will be fully inclusive, as so far, the indicator process is reneging on that promise. Being asked to meetings is not enough; civil society’s participation cannot be tokenistic inclusion.

We are also calling for specific and necessary changes to the draft indicators, to ensure that they are sufficient to truly measure governments’ delivery on their commitments.

Civil society has serious concerns about the current drafts tabled, as they are insufficient to truly measure whether people have access to safe, affordable and equitable water and sanitation.

These draft indicators do not go far enough to ensure the full implementation of the human right to water and sanitation.

This is why EWP member Freshwater Action Network- Mexico (FANMex) will be attending the upcoming informal interactive hearings on the post-2015 development framework held by the UN General Assembly on May 26 and 27.

We need to ensure that these processes are fully inclusive of civil

We must hold the UN accountable to fulfill its promise that the next development framework will be fully inclusive, as so far, the indicator process is reneging on that promise. Being asked to meetings is not enough; civil society’s participation cannot be tokenistic inclusion. society’s voice and that our future agenda is based on a human rights approach; that no one is left behind, and that ending poverty and tacking inherent systemic inequalities are of fundamental priority for our future.

The global crisis of water and sanitation is not caused by scarcity or population size. It is a political crisis, of unequal and unfair distribution determined by money, power and influence. This needs to change.

The two-day hearings ahead will see representatives from civil society, the major groups and from the private sector offering a critical opportunity for deeper engagement in the post-2015 development agenda.

We have to use this opportunity to call for the change we need, to reprioritize the importance of improved access to water and sanitation.

We feel that, particularly for goal 6, additional indicators are required which will monitor access to safe and equitable water and sanitation in schools and health centers, and that civil society is involved in the monitoring of the indicators.

For us, it is most critical that indicators will need to be disaggregated. This is to ensure that disparities and inequalities in progress are made visible, to prevent the poorest and most marginalized from being left behind.

EWP will be highlighting that the current draft indicators will not direct government action toward those who need it the most, the vulnerable and marginalized. Therefore, if left as is, they will simply replicate some of the failures of the Millennium Development Goals.

To reinforce this call and amplify our voice, simultaneously next week EWP members, alongside other civilsociety representatives, will be attending AfricaSan 4 in Senegal, a cross-continental meeting to assess levels of access to sanitation.

“Governments must work harder to meet their obligations on water and sanitation and improve people’s lives. Africa, in particular, has a very poor track record in ensuring sufficient access to sanitation; this needs to change to address major inequalities,” Samson Shivaji, CEO at Kenya Water and Sanitation CSOs Network, an EWP member, stated.

Civil society must have a voice in setting our future and call to prioritize sustainable water, sanitation and hygiene. We must ensure the human right to water and sanitation is realized for all. There is an urgency to prioritize improving people’s lives, with no one left behind, and the time is now.

Wednesday, May 27, 2015

National ml/tf risk assessment Atty. Liza Tubilleja

INSURANCE FORUM

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he Office of the President issued Memorandum Circular (MC) 64 on June 20, 2014, enjoining all concerned agencies to fully support and actively participate in the conduct of the Money Laundering/Terrorism Financing (ML/TF) National Risk Assessment (NRA) through involvement in the Money Laundering/Terrorist Financing NRA Working Group.

MC 64 states that the Asia/Pacific Group (APG) on Money Laundering is committed to the effective implementation and enforcement of internationally accepted standards to address ML/TF. Under the international standards on combating money laundering and terrorism financing, countries are required to identify, assess and understand the money laundering and terrorism financing risks for the country and are mandated, based on said assessment, to apply a risk-based approach to ensure that measures to prevent or mitigate money laundering and terrorism financing are commensurate with the risks identified.

The Philippines is a member of the APG and, in compliance with the international standards on combating money laundering and terrorism financing, the Philippines is taking part in the conduct of the ML/TF NRA. The Office of the President recognizes that there is therefore a need to constitute an NRA Working Group consisting of representatives from relevant government agencies and the private sector dedicated to the accomplishment of the objectives and completion of the ML/TF risk-assessment process.

The NRA has been a project of different countries. Its process is unique to each country depending on the circumstances present, and the assessment depends heavily on

the collaboration of the participatory agencies and sectors involved.

With this process, the country will be able to identify specific areas or sectors with low or high risk or vulnerability to ML/FT. The Insurance Commission is actively taking part in the NRA Working Group in coordination with the different government agencies and the private insurance sector. The need to assess the vulnerability in the insurance sector is an important process to strengthen the insurance industry and be capacitated to counter ML/TF risks.

Money laundering, as briefly described, is the process by which proceeds from a criminal activity are disguised to conceal their illicit origin. According to the Vienna Convention and the Palermo Convention provisions on money laundering, it may encompass three distinct, alternative acts: (1) the conversion or transfer, knowing that such property is the proceeds of crime; (2) the concealment or disguise of the true nature, source, location, disposition, movement or ownership of or rights with respect to property, knowing that such property is the proceeds of crime; and (3) the acquisition, possession or use of property, knowing, at the time of the receipt, that such property is the proceeds of the crime.

Terrorist financing, on the other

hand, involves the solicitation, collection or provision of funds with the intention of supporting terrorist acts or organizations. The funds may originate from both legal and illicit sources. According to the International Convention for the Suppression of the Financing of Terrorism, a person commits the crime of financing of terrorism “if that person, by any means, directly or indirectly, unlawfully and wilfully, provides or collects funds with the intention that they should be used or in the knowledge that they are to be used, in full or in part, in order to carry an offense within the scope of the convention.” In terrorist financing, the goal is not to conceal the sources of the money but to conceal the financing and the nature of the financed activity.

The insurance sector, which is part of the financial services industry, due to the nature of its business, is potentially at risk of being used for money laundering and the financing of terrorism.

Criminals and organized terrorists continue to look for ways to finance their activities and to conceal the illegitimate source of funds. The inherent nature of some products and transactions of the insurers are possible opportunities to launder money or to finance terrorism.

Being a possible target for money launderers and terrorist financers, the NRA process aims to assess the vulnerability of the insurance sector to ML/TF. This will determine the weaknesses and gaps in the defense mechanisms against ML/TF of the insurers. With an effective assessment, the insurance sector should be able to take adequate measures to prevent itself from being an instrument of ML/TF and be able to address the possible cases of ML/TF. MC 64 specifies the use of the risk-based approach. This approach is one of the recommended international standards recognized by the

Asia’s migrants: More boat people deserve help from those nearby

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t would be easy to think that the situation of the 4,000 Asian migrants on rickety boats near the Myanmar-Bangladesh coast is comparable to those seeking to cross the Mediterranean Sea from North Africa to Southern Europe.

In both cases these are people who are trying to escape poverty or persecution, victimized by human

traffickers and risking death by drowning. The places they are hoping to reach do not welcome them. Most of them have few skills, are illiterate and are hard to absorb.

But some of the circumstances of the Asians are different from those of the Africans or Middle Easterners seeking to reach Europe. Most of those arriving in Italy, France,

Greece and Spain embarked from Libya. Since the 2011 overthrow of Muammar Qaddafi, Libya has been in a state of chaos. It has no authority that can be held responsible for the migrant ships or for the criminals who trade in the transit of people.

In Asia, the two countries that are the source of the migrants are Bangladesh and Myanmar. Although

both are poor, they have functioning governments. These countries and Thailand, which is also involved in the migrant “trade,” can and should be held responsible for the dispatch of these vulnerable men, women and children from their shores.

The matter is worst in Myanmar, the origin of the Rohingyas, about half of the migrants. They are a per-

secuted Muslim minority seeking to leave a majority Buddhist country and the discrimination they have suffered for centuries. Indonesia, Malaysia and Thailand are not accepting their responsibilities to take the migrants ashore. On Tuesday the United Nations and the International Organization for Migration called on them to provide rescue operations and stop

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Financial Action Task Force (FATF), an independent intergovernmental body that develops and promotes policies to protect the global financial system against money laundering, terrorist financing and the financing of proliferation of weapons of mass destruction. FATF Recommendation 1 provides that “countries should identity, assess, and understand money laundering and terrorist financing risks for the country, and should take action, including designating an authority or mechanism to coordinate actions to assess risks, and apply resources, aimed at ensuring the risks are mitigated effectively. Based on that assessment, countries should apply a risk-based approach (RBA) to ensure that measures to prevent or mitigate money laundering and terrorist financing are commensurate with the risks identified.”

If the country is identified with higher risks, it should ensure that their AML/CFT regime adequately addresses such risks. However, where the country is identified with lower risks, it may decide to allow simplified measures for some of the FATF Recommendations under certain conditions.

The risk-based approach also takes into account that within a single jurisdiction, the various financial and nonfinancial sectors differ from each other. The RBA tries to address these differences by identifying the threats and vulnerabilities and determine the levels of risks in each of the identified sectors within the country. This approach is an essential foundation in the efficient allocation of AML/CFT resources and to implement international standards and risk-based measures to at least mitigate ML/TF risks, if not totally deter it.

Atty. Liza Tubilleja is presently the Chief of the Public Assistance and Mediation Division of the Insurance Commission.

pushing boats back from their waters.

Bangladesh and Myanmar are making matters worse by not preventing the exodus of migrants and the shameful trade in their misery. All five countries must do their part. If not, the rest of the world, including the United States, needs to apply pressure, first by denying them tourism.

Pittsburgh Post-Gazette/TNS

2nd Front Page BusinessMirror

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www.businessmirror.com.ph

PHL economy very good but can do more–IMF

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By Bianca Cuaresma

he International Monetary Fund (IMF), after a twoweek review of the economy, found no compelling reason to upgrade the country’s potential output growth this year, averaging 6.7 percent in terms of gross domestic product (GDP).

At the news briefing on Tuesday marking the end of the IMF’s 2015 Article IV Consultation Mission to the Philippines, mission leader Chikahisa Sumi said that, while the country’s growth story had been “very good,” he flagged certain risks that are seen hounding the country over the near and medium term.

Sumi, who started the consultation mission beginning on May 14, said in a statement that local output growth this year was kept unchanged at 6.7 percent. Forecast growth for next year was similarly retained at 6.3 percent.

“The outlook for the Philippine economy remains favorable, despite uneven and generally weaker global growth prospects,” Sumi added.

The 2015 growth forecast was seen supported by lower commodity prices that, in turn, should also help lift household consumption. Improved budget execution was also seen to raise the level of public disbursements and its impact on overall growth.

Sumi said the forecast growth could change, depending on how the first-quarter GDP growth number turns out next week, when it is finally announced in a few days.

For this year the IMF sees inflation hitting 2.4 percent, slightly higher than earlier forecast of 2.1 percent. The higher forecast incorporates risks posed by El Niño to the price of food and energy items this year. The new forecast was well within the Bangko Sentral ng Pilipinas’s target of 2 percent to 4 percent this year.

Output growth, however, could have been higher, if not for net exports projected

to soften due to sluggish trading partner growth and real exchange-rate appreciation.

The current-account surplus, indicative of an economy that has far more foreigncurrency earnings than expenses, was expected to exceed 5 percent of GDP this year due to lower oil prices and continued inflows from business-process outsourcing, plus remittances.

For next year, projected slower growth than 2015 was seen, as the impact of fiscal-sector restrictions on spending begins to wane.

Both forecasts fall below the government’s 7-percent to 8-percent growth for this year and next.

Risks flagged

“The Philippines’s economic condition has been very good, but this is not the best the Philippines can do,” Sumi said at the briefing. The risks to the outlook, according to the IMF, stem from both external and domestic sources.

“Disruptive asset-price shifts due to asynchronous monetary policies in advanced economies are a risk, but the Philippines’s strong fundamentals should provide the necessary cushion,” the IMF said.

On the domestic front, some of the risks seen this year include any resurgence of strong credit and construction growth seen to push financial instability, and continued weak budget execution that could slow down improvements in infrastructure.

Downside risks associated with El Niño were also cited, the IMF noting their impact on harvest and the rapid run-up in food prices.

“Any rapid food-price increases due to El Niño-related drought should be addressed

preemptively by promptly increasing food imports and such should not justify monetary tightening, unless second-round effects were to appear,” the IMF said, adding that the stance of monetary policy is “currently appropriate.”

Policy recommendations

Investments in infrastructure and human capital were nevertheless seen to improve the country’s economic trajectory in the medium term.

“Despite strong growth and improvements in various areas over the last few years, the country has the potential to do even better and build a more inclusive society with reduced poverty, particularly in the context of Asean economic integration,” the IMF said.

The IMF also said the government must step up investments in infrastructure and its young population to create much-needed employment opportunities.

The IMF also cited structural reforms that further open up the economy to increased competition; strengthening public finance management; and implementing an inclusive financial- development strategy for small and medium enterprises.

“To support job creation and poverty reduction, we strongly encourage the authorities to resolve the uncertainties with the use of agricultural and titles as collateral for bank loans; improve urban and regional connectivity; reform the National Food Authority and ease quantitative restrictions on rice imports; and reduce skill mismatches through expanded education and apprenticeship programs,” the IMF added.

Govt spending. . .

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The economist added that the low government spending would raise the likelihood of monetary-policy shift toward easing the rates, as opposed to tightening.

“We think some of the rally in Philippine financial assets this year has been a repricing for a less hawkish BSP [Bangko Sentral ng Pilipinas]. The rally may have room to run,” Cuyegkeng said.

The government reported on Monday that the budget deficit of the national government stood at P33.5 billion for the first quarter of 2015. The endMarch figure is significantly less than the P84.1billion shortfall recorded for the same period in 2014.

The 6.1-percent growth in 2014 had been attributed to several factors by various quarters.

At its annual forum last week, the staterun think tank Philippine Institute for Development Studies said the chances for boosting growth this year would depend on how well the government reverses the slow spending in the past and untangles the bottlenecks in domestic infrastructure, seen accounting for the 6.1-percent growth in 2014.

Bianca Cuaresma and Butch Fernandez