BusinessMirror August 11, 2015

APEC MEET Around 400 delegates and participants from the Asia-Pacific Economic Cooperation’s (Apec) member-economies converge for the sixth meeting on Policy Partnership on Science, Technology and Innovation (PPSTI-6) to hold talks and forge partnerships based on the theme “Science, Technology and Innovation for Inclusive Growth.”

The meeting, led by the Philippines’s Science Secretary Mario G. Montejo and China’s Chen Linhao, PPSTI-6 chairman, runs from August 10 to 12 and to be followed by the Apec High-Level Policy Dialogue on Science and Technology in Higher Education on August 13 and 14 at the Philippine International Convention Center in Manila. Story below. RTVM

BusinessMirror

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

U.N. MEDIA AWARD 2008

A broader look at today’s business Saturday 2014 11, Vol. 10 No. 40Vol. 10 No. 306 Tuesday,18, August 2015

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

LONGTERM INVESTMENTS CONTINUE TO FLOW IN, BUT AT CONSIDERABLY SLOWER RATE

Jan-May FDI down 42 percent B B C

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OREIGN direct investments (FDI)—the kind actually infused in so-called bricks-and-mortar endeavors in the country—posted a 42-percent decline in the first five months to only $1.637 billion, the Bangko Sentral ng Pilipinas reported on Monday.

INSIDE

IF YOU BUILD IT...

Our greatest joy

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TAY with us always, Lord. Stay with our family. Keep us together in joy and in sorrow. When discord disrupts our relationships, give those who are wrong the humility to accept their mistakes; and those who are wronged the grace to forgive. When we are burdened with problems, give us the wisdom to know the right solution. When you ask us to bear the cross, give us the strength to obey. Let our greatest joy be the knowledge that we are striving to do Your will. May our greatest joy rest in our everlasting love for You. Amen.

DAILY PRAYERS, VIRGIE SALAZAR AND LOUIE M. LACSON

Word&Life Publications • teacherlouie1965@yahoo.com

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

Life

This represents a significant slowdown in the entry of foreign capital that could help sustain continued economic expansion beyond the term of President Aquino in the years after 2016, as the new tenant in Malacañang begins a new six-year term.

The FDI in May alone contributed $403 million to the total five-month inflow and, thus far, the largest batch of foreign capital invested for the long haul in the country. But still,

BOX OFFICE: ‘FANTASTIC FOUR’ FAILS TO DRAW YOUNG FANS, FINISHES 2ND TO ‘MISSION’ »D2

BusinessMirror

Tuesday, August 11, 2015

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J-TECH Inverter Refrigerator and Split-Type Air Conditioner

Save money and save Mother Earth by saving energy THE rising cost of living these days demands that we look for ways to consume less energy to save up on electric bills. Global warming, a much bigger concern, implores us to use energy-efficient technology to lessen our carbon footprint. There are several things in our lifestyles that we can change to save energy—and all of them are quite simple and easy to implement.

One tried-and-tested way to save energy is to unplug all electronic devices when not in use. Turning them off but keeping them plugged consumes “phantom load,” which means these devices still consume energy even when you’re not using them. Another energy-saving tactic is to change your light bulbs with more energyefficient varieties like LED. They may cost more to buy, but they last at least 10 times longer and consume about 75 percent less energy compared to usual incandescent bulbs. Simple habits like making sure your refrigerator door is closed can save you loads of energy. Placing your refrigerator and air conditioner in strategic areas in the room—away from heat-generating devices—can also save your appliances from working too hard and, therefore, consuming more electricity than normal.

Upgrading your old appliances to energy-efficient ones is also a fantastic way to save energy. Old appliances consume a lot of energy compared to their newer counterparts. If you’re looking to upgrade to save on energy, reduce power consumption, and save the environment, look no further than the lineup of J-Tech Inverter Refrigerators and Split-Type Air Conditioners from Sharp Philippines (www.sharp.ph). www.sharp.ph www.sharp.ph).

With its 32-step Smart Inverter Technology, J-Tech Inverter Refrigerators provide energy savings by up to 40 percent, with a precise temperature control to help protect stored food and preserve it for longer periods.

With its non-CFC refrigerant, the refrigerators also help protect the ozone layer against harmful emissions. Aside from the J-Tech Inverter technology, the refrigerators also offer other convenient features, such as Ag+ Nano deodorizer for a nearly odor-free interior, and powerful freezing capability for efficient ice-making.

The Sharp J-Tech Inverter Air Conditioners, meanwhile, provide convenient and energy-efficient operation with up to 60 percent in energy savings.

J-Tech Inverter temperature control technology maintains room temperature and saves energy by switching compressor operation between high and low modes once the room achieves optimal temperature levels. You can achieve even more energy savings when you put the air conditioner on Eco Mode.

Sharp’s J-Tech Inverter refrigerators and air conditioners are all engineered to provide superior technology and genuine Japanese hospitality, each made with the vision of providing more comfort and convenience to make the lives of modern households of today much easier.

AVIDA Land’s four-tower residential project Serin East is designed to blend with the natural beauty of Tagaytay. Meanwhile, the center row displays a designed one-bedroom unit of Avida Towers Vita as part of the “Avida x RL Open House” competition featuring three young interior designers paired with an industry veteran. Gino Eraña, mentored by Kristine Neri-Magturo, emerged as the winner for his bedroom design (center right), beating the work of the John Vigilia-guided Joevie Tuquib for the living room (center left) and the kitchen/dining room styling of Jane Samson, who was coached by Hannah Acab Faustino.

‘If you build it, they will come...’

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B JT N

T’S not hard to see why many urbanites fancy owning a place they can call their own in Tagaytay. Nestled in luscious greenery and cocooned by a desirably un-tropical climate, this favorite weekend or holiday getaway destination offers, both figuratively and literally, a breath of fresh air.

Offering the chance to make this dream a reality is Serin East Tagaytay, Avida Land’s latest residential development in that elevated pocket in the south.

Located along the diversion road connecting Aguinaldo Highway and the Tagaytay-Nasugbu Highway, the four-tower project with a total of 1,343 residential units comes after the development of Serin West, first launched in 2012, with 10- and 13-story towers that offer a 480 units combined. Avida Land is a subsidiary of Ayala Land Inc. According to Avida Marketing Head Tess Tatco, the development has been designed and is being executed to reflect and honor the natural beauty of Tagaytay. “[The properties are] vacation homes that are designed to readily take away the stress of everyday city living as the development blends in with the ridges of Tagaytay,” Tatco said, pointing to the towers’ overall “green” design and its mid-rise height suitable to the area’s landscape.

Aside from the rustic vibe and laid-back style of living that Serin East presents, it also offers two levels for amenities. To be located at the ground level is

a dipping pool with cascading waters, game room, clubhouse and function rooms, while generous open spaces, heated pool, gazebo lounge and jogging and reflexology path make up the podium level. True to Avida Land’s promise of making this property in tune with Tagaytay’s scenery, there are amenities and designs exclusive to Serin East, including resort-type swimming pools and a higher number of garden areas than usual.

As for the development’s target market, Tatco said they’re looking at young families, retirees and those who are looking for second homes as investments.

“This is more of a place where families can relax.

That’s what Tagaytay has to offer.” Moreover, future residents need not worry about being far removed from urban comforts, Tatco added, because of the property’s proximity to the metropolis. Tagaytay is, after all, just an hour drive from Alabang and, at max, just two hours away from Makati City.

On the macro scale, Serin East, the first tower that is nearing completion with the expected turnover to owners scheduled next year, is part of a 5-hectare mixed-used project that includes a church and the Ayala Malls Serin.

According to Tatco, this development which offers studio, one-bedroom and two-bedroom units, is their first condo project in Tagaytay but their fifth in Cavite.

SPOTLIGHTING YOUNG DESIGNERS AMONG the company’s many residential developments is the Avida Towers Vita, the first residential condominium set to rise in Ayala Land’s 29-hectare

masterplanned estate in Quezon City, the Vertis North.

In June Avida Land partnered with home magazine Real Living for the “Avida x RL Open House,” a competition that pitted young interior designers paired with an industry veteran to style an assigned segment of an Avida Towers Vita one-bedroom unit.

The teams each had a P100,000 budget, plus access to a large selection of coating solutions from Nippon Paint Philippines and Electrolux appliances to create their respective visions. The entries, judged by a panel from Avida and Real Living Living, were evaluated based on originality, resourcefulness and the overall “wow” factor of their space. Recently, it was revealed that Gino Eraña, mentored by Kristine Neri-Magturo, came away as the competition’s top winner.

“It was an amazing experience for me because I learned a lot,” the 26-year-old designer said. “Kristine imparted a lot of design strategies that were really effective and made our space successful.”

In his winning design for a bedroom, Eraña drew inspiration from a young newlywed’s fun and active lifestyle with modern and chic interiors that feature clean lines characteristic of the Scandinavian aesthetic.

There were beach-inspired touches in his design here and there, with his usage of weathered wood and nautical pieces brought to life by trendy copper accents.

The space evoked elegant simplicity, while the color palette he went with was equal parts airy and relaxing.

The Avida x RL Open House model unit, as well as other units, are available for viewing at the Vertis North showroom of Avida Towers Vita until September. n

LIFE

Design&Space BusinessMirror

A TREASURE for the Zamboangeños, the 4-kilometer Santa Cruz Beach is famous for its pink coralline sand whose color comes from pulverized red organ pipe corals mixed with white sand. It is the only beach in the Philippines with pink sand.

NOW OW a major landmark in the province of Zamboanga and a significant part of its cultural heritage, Fort Pilar is Spanish garrison originally built as a wall of defense against pirates, raiders and the fierce Moro warriors of the sultans of Mindanao and Jolo.

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IN the Spanish colonial style, the Zamboanga City Hall was first built in 1905 and completed in 1907, and is where the city mayor holds office today.

CHRISTEL BONCAN C -CONSTAN CAN T TINO TAN

URBAN MONOLOGUES 2.0 NIKKI BONCAN-BUENSALIDO

design@buensalidoarchitects.com www.buensalidoarchitects.com

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OMETIMES, the beauty in things comes to sharp focus when seen in a different perspective or context. It can be spurred by a peaceful or relaxing environment, one that evokes calmness and beauty. Of course, beauty can also be found in places where there is a bit of danger and adventure. This can even lend to the charm, the appeal of a place.

Underneath all the headlines of violence and death lies a gem known as “Asia’s Latin City”—Zamboanga— an administrative region that is deeply informed by its Spanish past which has since transformed into something that is uniquely Filipino. The people of Zamboanga City, the commercial and industrial center of the region, are peaceful, quiet and quaint, all enduring the ravages of war that has lingered in Mindanao for decades. Their dialect is music to the ears as it sounds

THE ZAMBOANGA CITY HALL THE Zamboanga City Hall was first built in 1905 and was completed in 1907, and it is where the city mayor holds office today. Built in the Spanish colonial style, it is not only a landmark of the city but also the entire archipelago of Mindanao and Sulu. It was a bastion of power throughout the history of Mindanao, and was once the capital of the whole Mindanao region.

Its Spanish-influenced architecture is due to the city’s Hispanic traditions which, up to this day, the locals are still practicing. The site has been declared a National Historical Site by the National Historical Commission of the Philippines.

FORT PILAR ALSO known as the Real Fuerza de Nuestra Señora del Pilar de Zaragoza (Royal Fort of Our Lady of the Pillar of Zaragoza), Fort Pilar was a military defense fortress similar to that of Intramuros in Manila. Built in the 17th century by the Spanish colonial government, the fort is now considered a regional branch of the National Museum of the Philippines. The fort today has become a major landmark in the province of Zamboanga, and a significant part of its cultural heritage. The bastion was originally built as a wall of defense against pirates, raiders and the fierce Moro warriors of the sultans of Mindanao and Jolo. Here’s a bit of interesting trivia: Because of the lack of laborers to build the fort, people were transferred from Cavite, Bohol, Cebu and Panay to help the Spaniards in its construction. It was here that

the beginnings of the Chavacano dialect evolved. Today, T the fort is an outdoor Catholic Marian shrine that retained the charm of the ruins against a foreground of lush greens.

SANTA CRUZ BEACH WHOEVER R would have thought the Philippines has a beach with pink sand?! The Great and Little Santa Cruz Islands, situated in the Basilan Strait, are accessible from the tourist center of Zamboanga via a 15- to 20-minute boat ride. The 4-kilometer beach is famous for its pink coralline sand whose color comes from pulverized red organ pipe corals mixed with white sand. It is the only beach in the Philippines with this feature. The main beach is sometimes decked with vintas, traditional native boats known for their vibrant colorful sails.

Snorkeling around the island provides the dazzling spectacle of colorful fishes and corals. On a good day, fishermen visit the island to offer tourists the fresh catch of the day, along with the offer to cook the sea bounty for them. As a side note, what was particularly exciting about our trip was that there was a marine assigned to the group who would notify us of any eventuality. He said that when a red alert goes up, tourists are kept safe in the island until the alert is taken down.

Zamboanga is truly a beautiful province. People have kept and nurtured its inherent charms, and it is a place where Catholics and Muslims live together in peace. I dream of the day when Zamboanga will be on top of the list of the country’s top tourist destinations. n

How to modernize ’80s décor B C H Tribune News Service REMEMBER R when black and mauve was the hot color combination and when mirrors were all the rage? Well, in case you are too young to remember, those were some of the staples of 1980s home décor.

The 1980s were indeed the decade of opulence, marble, gold and mirrors. These days, however, the trend is toward minimalism and more subtle design.

Even so, it may not be unusual for a homeowner to be E stuck in time and looking for ways to refresh a home that has not been updated since its 1980s glory.

While you may think it may be easy to simply cover up as much of the 1980s-themed design as possible—cue the DeLorean car and Patrick Nagel painting—I suggest embracing it to a certain extent.

To me it never makes sense to cover up great design T no matter when it was done.

Here are some of my top tips for modernizing the past while embracing the present: 1. Embrace the current décor and use it as inspiration.

2. Soften a space, while adding color and texture.

Whether floors are made of marble or hardwood, it is often an appealing solution to add softness through the use of area rugs and soft goods such as toss pillows.

3. Add elements such as greenery. Nothing quite softens a space like the use of plants and greenery.

4. Select a mix of modern and contemporary furnishings. It is important to not ignore the current design and décor, but instead to embrace it as another design element to include as part of your overall design scheme.

5. Focus on function and lifestyle. The way you live in your space is likely always evolving. A room that may have been popular in another decade may now be considered to be a waste of space.

These days, with space at such a premium, it is more important than ever that all areas of a residence are shown as useful and with a purpose.

DESIGN&SPACE n Cathy Hobbs, based in New York City, is an Emmy Award-winning television host and a nationally known interior design and home staging expert. Visit her web site at www.cathyhobbs.com.

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3-FOR-3

3-FOR-3 Michael Phelps made it 3-for-3 at the US national championships on Sunday night, winning the 200-meter individual medley with yet another time that would have been good enough for a world title if he had been allowed to compete at the biggest meet outside the Olympics.

Sports BusinessMirror

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| TUESDAY, AUGUST 11, 2015 mirror_sports@yahoo.com.ph sports@businessmirror.com.ph Editor: Jun Lomibao

B P N

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The Associated Press

AN ANTONIO—Having established himself as the shadow world champion in three events, Michael Phelps pondered the last time he felt this good.

He quickly pointed to the year leading up to the 2008 Beijing Olympics, where he broke one of the greatest records in sports.

It looks as if he’s headed for another massive medal haul in Rio. Phelps made it 3-for-3 at the US national championships on Sunday night, winning the 200-meter individual medley (IM) with yet another time that would have been good enough for a world title if he had been allowed to compete at the biggest meet outside the Olympics.

On the heels of brilliant performances in the 100 and 200 butterfly, Phelps set himself up as the favorite in all three races looking toward Rio. “I’m very happy where I am right now,” he said. “This is a great foundation. This is a place we really haven’t been in a long time leading up to an Olympics. I definitely wasn’t like this leading up to 2012. It’s probably been since 2007 that it’s been like this. I can sit here and argue with you that 2007 is probably the best year of my career. It’s probably the last time I had three events like this back to back to back.”

Phelps was under world-record pace through the first three laps of the medley—fly, backstroke, breaststroke—but he struggled a bit on the freestyle leg to touch in one minute and 54.75 seconds—0.75 off the mark set in 2011 by American rival Ryan Lochte.

Still, it was more than second faster than Lochte’s winning time of 1:55.81 at the world championships, held in Kazan, Russia, over the past two weeks.

Phelps, of course, wasn’t allowed to compete at worlds this year.

He was kicked off the US team after his second drunken-driving arrest last September, leading Phelps to swear off alcohol and take a good, hard look at himself during six weeks of inpatient therapy in Arizona. He emerged with what he said

IT looks as if Michael Phelps is headed for another massive medal haul in Rio. AP

was a new outlook on life and a commitment to put in the sort of training that marked the peak of his career, when he was driven to break Mark Spitz’s 36-year-old Olympic record by winning eight gold medals in Beijing.

With an embarrassing string of problems outside the pool, Phelps still must prove to his skeptics that he’s a changed man.

There are no longer any doubts about what he can do in the water at age 30.

“I’m pumped,” he said. “Being able to do that right now, I’m very, very pleased. It’s something great to build from.”

In the two butterfly events, Phelps put up the fastest times since high-tech bodysuits were banned after the 2009 worlds. In the 200 IM, he went faster than anyone has gone since his gold medal-winning time of 1:54.27 at the London Olympics three years ago.

He managed to go fast in sweltering Texas even though most of the top swimmers were competing halfway around the world in Russia. Phelps was largely racing the clock in San Antonio, without anyone to seriously challenge him.

That didn’t matter. He met his goal of going faster than the world champion in all three events.

Phelps’ longtime coach, Bob Bowman, said the swimmer “greatly exceeded” his expectations.

“We’re ahead of schedule,” Bowman said. “Just seeing him put up those kind of times, it probably does change what I thought might be possible in a year. I thought he could get near his top level. I wasn’t sure it would happen this quickly.”

Already the most decorated athlete in Olympic history with 18 golds and 22 medals overall, Phelps will surely compete in the same three individual events at Rio that he dominated in San Antonio, and it seems highly likely he’ll be on all three US relay teams after a disappointing performance by the Americans in Kazan.

The US men didn’t even qualify for the final of the 400 free relay at worlds, and they settled for silver in the 800 free relay. A gold medal on Sunday in the 400 medley relay did little to ease the sting.

Phelps’s celebration after the 200 IM was more muted than the two previous nights, though, he did climb on top of the lane rope and thrust both arms skyward. After he climbed from the pool, he paused to watch a replay of the race on the video board, trying to figure out how to go even faster.

“I was more ticked off when I saw I was under record pace at the 150,” Phelps said. “That kind of bothered me.”

Phelps has one more event in San Antonio: the 200 breaststroke on Monday. But that’s not one of his better events, and he entered it merely to get in a little more work on the final day of nationals.

Actually, his work is done.

For now.

SWEDEN’S Jennie Johansson celebrates her victory in the women’s 50-meter breaststroke, as Chinese star Sun Yang is enveloped in mystery. AP

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WHERE’S SUN YANG?

AZAN, Russia—No sooner had Sun Yang returned to the top of the podium with two victories at the world swimming championships than the Chinese star was enveloped in mystery.

Sun failed to show up for the 1,500-meter freestyle Final on Sunday night, creating chaos in the call room minutes before the race in which he was the two-time defending champion.

The 23-year-old swimmer later said a heart problem caused him to vanish.

Sun couldn’t be found by the judges, and Lane 3 remained empty, while Gregorio Paltrinieri of Italy won.

“Today I came here and during the warm-up in the pool, I feel uncomfortable in the heart so I have to give up competition,” Sun said through a translator at a news conference after the races ended. “I feel sorry because of that.”

Earlier, International Swimming Federation (Fina) Spokesman Pedro Adrega said Chinese team officials told him Sun felt a “chest sensation” during warm-ups.

“As there was not enough time to evaluate the situation or to check his medical condition, they decided to withdraw,” he said.

Sun said he decided on his own not to swim the 1,500. He said he would return home on Monday to

arrange a medical exam of his heart.

Sun’s rivals were shocked by the strange turn of events.

“The judges were going crazy yelling, ‘Where’s Sun Yang? Where’s Sun Yang?’” Paltrinieri said. “It was insane.”

Sun appeared at the end of the night to receive the best male swimmer award. He won the 400 and 800 freestyles in Kazan and was a strong favorite in the 1,500, which he won at the London Olympics. Sun finished second in the 200 free.

Brazil men’s coach Alberto Silva told the Associated Press (AP) there was an incident in the warm-up pool on Sunday morning when one of his female swimmers was in the same lane as Sun, though Silva did not think it was the reason Sun didn’t compete.

“There was a discussion,” said Silva, adding that no one was injured. “It’s a short girl and a big guy. He went across [her].”

Silva said he complained to officials of world governing body Fina, and they spoke to a Chinese team official. “[The Chinese] came to the Brazilians and said sorry. That’s it,” said Silva, who declined to identify the Brazilian swimmer.

Brazil team Spokesman Eliana Alves told the AP there was contact between Sun and the Brazilian

athlete “but it was not a fight.”

Chinese team officials declined comment on the warm-up pool incident.

“I have no comment because it’s the morning program,” Sun said.

Sun was back at the biggest meet before next year’s Olympics after serving a three-month doping suspension last year for a banned stimulant. At the time, he said the positive test was caused by an ingredient in medication he was taking for a heart condition and he wasn’t aware it was banned.

His punishment began immediately after he tested positive in May. However, Chinese officials kept the test quiet for six months and Fina also waited until late November to post the sanction on its web site.

Sun got in trouble in November 2013 for driving without a license after the car he was operating was hit by a bus. Earlier that year he was formally censured by his training school after feuding with his coach and missing practice.

Paltrinieri took the lead from Cochrane at 500 meters and controlled the pace the rest of the way, touching in 14 minutes and 39.67 seconds. He finished second to Sun in the 800 and their rematch had been highly anticipated.

“I didn’t know what to do or think,” the Italian said. “It

was really terrible without him.”

The others in the call room wondered about Sun, too.

“I started saying, ‘He’s afraid of us and he’s not coming,’” Paltrinieri said. “Then he really didn’t show up.”

Sun’s absence threw off the Italian’s race strategy.

“I’ve been training for two years on how to beat him, right down to the smallest details,” Paltrinieri said. “I had to change everything.”

Connor Jaeger of the United States finished second in 14:41.20. Cochrane, who was under world-record pace through 400 meters, was third in 14:51.08. He earned his fourth straight medal in the 1,500, equaling Australian great Grant Hackett.

“We would have liked the best field possible but it was still a pretty hard race,” Cochrane said.

The US received the best team trophy for the eight-day meet, winning 18 medals, including seven golds.

Katinka Hosszu of Hungary made a run at the world record in the women’s 400 individual medley before falling short on the last freestyle lap. She won in 4:30.39, after being 3.81 under world-record pace after five laps.

Hosszu, nicknamed “Iron Lady” for her relentless event schedule, also won the 200 IM in world-record time.

The US won the men’s 4x100 medley relay two years

after touching first and then being disqualified when Kevin Cordes dived in too soon on the breaststroke leg.

Ryan Murphy, Cordes, Tom Shields and Nathan Adrian won in 3:29.93.

Australia was second and France third at Kazan Arena, where Russian Prime Minister Dmitry Medvedev was in attendance.

The women’s 4x100 medley relay was claimed by China’s team of Fu Yuanhui, Shi Jinglin, Lu Ying and Shen Duo in 3:54.41. Sweden was second and Australia finished third.

Japan’s Daiya Seto cruised to a 1.40-second victory for his second consecutive title in the 400 individual medley.

Seto led all the way and won in 4:08.50—0.19 faster than he swam two years ago in Barcelona.

Bronte Campbell of Australia won the 50 freestyle to go with her title in the 100 free. She touched in 24.12.

Olympic champion Ranomi Kromowidjojo of the Netherlands was 0.10 behind in giving up the title she won in Barcelona. Sarah Sjostrom of Sweden took third in 24.31.

Campbell’s older sister, Cate, was fourth.

In a pair of non-Olympic events, Jennie Johansson of Sweden earned a surprising win against a talented field in the 50 breaststroke, while Camille Lacourt of France won the men’s 50 backstroke. AP

SPORTS

SUGGESTED RETAIL PRICE SCHEME: BOON OR BANE? B C N. P

Getting to know Zamboanga like a mash-up of Spanish and Filipino, something definitely distinct and unique.

This is the other side of Zamboanga. A trip to this southern part of the country unveiled sounds and images that we never expected to find, including natural beauties comparable to the best offered by other, more popular locations in the Philippines.

Zamboanga is the sixth most populous and the third largest city by land area in the Philippines and was used as one of Spain’s strongholds in 1569 when the Spaniards first landed in the Philippines. After winning independence from Spain in 1899, the Republic of Zamboanga was established with Zamboangueño Chavacano as its official dialect.

Chavacano is a creole Spanish-based language spoken in certain parts of the Philippines and has survived for about 400 years, making it one of the oldest creole languages in the world. Chavacano also has survived and evolved from the Caviteño and Ermiteño mestizos—a language now considered extinct in the modern world. Contrary to common knowledge, since Zamboanga was one of the first places to be inhabited by the Spaniards, most of the locals of Zamboanga are Catholic than Muslim.

Zamboanga has plenty of charms that are both typical and atypical to the other Philippine islands.

Besides its generally peace-loving population, Zamboanga is famous for certain sites that continue to stir a sense of nationalism and are a source of great pride among locals. Here are my top 3.

S “FDI,” A

SPECIAL REPORT

KNOWING ZAMBOANGA D4 Tuesday, August 11, 2015

the FDI in May proved 6.8 percent lower than in May last year, when this aggregated $433 million.

Some have said that, while foreign interests continue to pour muchneeded capital into their Philippine operations, the lack of more positive signals from the government in building growth-boosting public infrastructures contributed to less robust capital-injection exercises during the period.

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Second of three parts

HE Department of Trade and Industry (DTI) fears that changing—or stopping—the Suggested Retail Price (SRP) scheme that it is now implementing will lead to unpredictable spikes in the cost of goods, to the detriment of Filipino consumers.

A study published by the Department of Justice’s Office for Competition (OFC) in June labeled the implementation of SRP as “restrictive to competition,” and was deemed “an over-regulation” on the part of the government.

The SRP scheme—implemented by several agencies, including the DT—prescribes a price schedule for select brands of basic and prime goods as set by manufacturers.

This price schedule is used by the DTI, the Department of Agriculture and other concerned agencies in monitoring the prices of covered goods in retail establishments. It represents the maximum price a

PESO EXCHANGE RATES n US 45.7790

covered good can be sold for, and factors in the retailers’ margin.

The OFC, headed by Justice Assistant Secretary Geronimo L. Sy, said price monitoring—as a way to guide consumers, retailers and the private sector—should be sufficient.

The current setup, wherein penalties and fines are meted out by the DTI on retailers if the SRP is not complied with, makes the SRP a “de-facto price control,” the OFC said in its report.

Moreover, the implementation of the SRP requires manufacturers and goods suppliers to seek approval if any price adjustment is to be made on their retail prices, which they themselves submit to the DTI. The approval process and penalties, according to the study, undermine the recommendatory nature of the SRP mechanism and give wide margin of authority in determining prices to the government. The main agency enforcing the SRP for nonagricultural basic goods and prime commodities is the DTI. C  A

SBS IPO Chairman and President Necisto U. Sytengco (sixth from left) leads the bell-ringing ceremony during the initial public -offering listing of SBS Philippines Corp. at the main board of the Philippine Stock Exchange (PSE) under the ticker symbol “SBS”. Joining him are (from left) BDO Capital and Investment Corp. Institutional Banking Head and Senior Executive Vice President Walter Wassmer; BDO Capital and Investment Corp. EVP and President Eduardo Francisco; SBS Philippines CFO and Treasurer Aylene Sytengco; SBS Philippines VP for Investments Ned Bryan Sytengco; SBS Philippines SVP for Sales and Marketing Necisto Sytengco II; PSE Chairman Jose T. Pardo; PSE Director Vivian Yuchengco; PSE President Hans Sicat; and PSE Director Alejandro Yu. ALYSA SALEN

PHL to Apec: Help technopreneurs, MSMEs boost their share in growth B L R Senior Editor

T

HE Philippines called on the Asia-Pacific Economic Cooperation (Apec) to seek ways to “further nurture and support MSMEs [micro, small and medium enterprises] and technopreneurs—to enhance their role as major contributors to development and inclusive growth.”

Science Secretary Mario G. Montejo made the call during the opening on Monday of the sixth meeting of the Apec Policy Partnership on Science, Technology and Innovation (PPSTI-6), with the theme “Science, Technology and Innovation for Inclusive Growth.” It aims to highlight the importance of science, technology and innovation (STI) as an “engine of economic growth and social progress.”

At the same time, PPSTI-6 Chairman Chen Linhao said that in Apec’s meetings since 2010, STI have become an increasingly important driving force for economic sociodevelopment, and quality and efficient growth.

“Innovation has been included as

an important topic in several Apec leaders’ declarations,” Linhao said in his opening remarks on Monday for the three-day PPSTI-6 meeting.

He said that in 2015, PPSTI has submitted a total of 24 project proposals, while 20 PPSTI projects and activities have already been confirmed for the 2015 and 2016 periods. No details about the projects were given.

“These projects are translating policies set by Apec leaders and ministers into concrete actions,” he noted.

“On the whole, PPSTI has come a long way in enhancing science capacity building; improve innovation in neighboring environment; and bolstering regional connectivity in science and technology [S&T],” Linhao said. Montejo said in his welcome message that the focus of the meeting is on MSMEs, “and how Apec mechanisms, through PPSTI, could encourage them to become more active players of our innovation ecosystem and contribute more in our development efforts.”

Like most Apec economies, he said the Philippines recognizes this “very important role of MSMEs to national development.”

“As the backbone of the economy or the linchpin of economic development, this sector is critical for investment and economic growth and job creation,” he said.

MSMEs in the Philippines, Montejo said, account for 99.6 percent of total establishments in the country.

They contribute 61.2 percent of the country’s total employment and 35.7 percent of total value added.

“More important, most of our MSMEs are located in the countryside, and they create value from our agricultural and other natural resources,” he said.

However, Montejo said, a key concern for MSMEs are their “low productivity due to lack of access to technologies, weak technological capabilities, and failure to engage in innovation and research and development activities.”

To address this concern, he said, the Department of Science and Technology has been strengthening and enhancing the country’s S&T-based innovation ecosystem “to be able to empower the MSMEs to come up with innovative ideas to improve productivity, create new products, C  A

n JAPAN 0.3685 n UK 70.9208 n HK 5.9049 n CHINA 7.3722 n SINGAPORE 33.0869 n AUSTRALIA 33.8677 n EU 50.1875 n SAUDI ARABIA 12.2077 Source: BSP (10 August 2015)

A2 Tuesday, August 11, 2015

BMReports BusinessMirror

news@businessmirror.com.ph

Suggested retail price scheme: Boon or bane?

For the DTI, the implementation of SRP is necessary to keep prices at reasonable levels for consumers. Because of that, the list of products covered by the scheme should even be expanded.

“If it is working, and working efficiently, why change it? Maybe the challenge is to strengthen the use of SRP. And when I say strengthen, maybe we should expand the list of basic goods and prime commodities that would bear the SRP, so more consumers can look forward to reasonable retail prices and to ensure market competition on the market level for businesses,” Trade Undersecretary for Consumer Protection Victorio Mario A. Dimagiba said in an interview.

According to the Price Act, which is the basis for the implementation of the SRP scheme, basic necessities are goods vital to the needs of consumers for their sustenance and existence. Prime commodities are goods not considered as basic necessities but are essential to consumers.

Basic necessities under the SRP scheme include: bread, canned fish and other marine products, bottled water, processed milk, locally manufactured instant noodles, coffee, salt, laundry soap, detergent and candles.

Prime commodities monitored by the DTI are: processed and canned pork, processed and canned beef and poultry meat, condiments such as vinegar, patis, soy sauce, toilet soap, paper, school supplies, cement, clinker, galvanized iron sheets, hollow blocks, construction nails, batteries, electrical supplies, light bulbs and steel wires.

The present application of SRP, reasoned Dimagiba, cannot be seen as having a significant impact on market competition, as it covers just a handful of products and brands, and not even all the packaging sizes are covered. “ The way we do it, not all basic goods and prime commodities have SRP. We just selected the smaller sizes and those affordable by the type of consumers that would benefit from an SRP,” Dimagiba said. For sardines, for instance, he said the DTI only monitors seven brands.

Moreover, contrary to the OFC study’s argument, the DTI underscored that the SRP is a powerful tool against anticompetitive behavior.

A case in point made by Dimagiba is the run-in of flour millers and bakers with the DTI two months ago.

The Cabinet agency had observed a marked drop of 28.8 percent in the global price of wheat and called on local flour millers to reduce their costs per bag of flour so bakers may also decrease their prices.

Despite repeated requests from the DTI to reduce prices, flour millers and bakers did not implement downward adjustments, prompting the trade office to place them under investigation for possible collusion and profiteering.

The drawn-out confrontation ended with flour millers and bakers reducing their prices within the recommended range of the DTI. While two brands of bread are covered by the SRP (Pinoy Tasty and Pinoy

pan de sal), the rest of the products being offered to the market are not. Flour is not in the scheme either, but is being monitored by the DTI’s Consumer Protection Group (CPG).

The absence of the SRP mechanism in this case, Dimagiba said, prolonged the process of reducing prices for consumers, as the trade office had to involve the National Bureau of Investigation to nudge suppliers to lower prices.

Price fluctuations of basic goods, prime commodities and brands that are not covered by the SRP scheme can also be observed through the market monitoring.

According to data from the DTI-CPG, in July, 60 supermarkets in the National Capital Region increased prices for select brands, basic necessities and prime commodities not covered by the SRP. The increase ranged from P 0.75 to as much as P 11

The price increase per product type is as follows: (brands and unit packages not disclosed)

Basic necessities and prime commodities

Month-on-month comparison of price increase (July 6-10,2015)

Canned sardines

P0.75 - P0.95

Condensed milk

P3

Condensada

P1.10-P4

Evaporated milk

P0.75

Evaporada

P0.75-P2.55

Powdered milk

P4.55-P11

Coffee refill

P5.00-P8

Luncheon meat

P3.05-P4.50

Meat loaf

P1.95

Beef loaf

P1.20-P1.90

Vinegar

P0.90

Patis

P1.15

Soy sauce

P0.80

Toilet soap

P1.25-P5

“There is competition in these goods, but is it reasonable? I don’t think so.

We observed that basic and prime goods without SRP the prices move a lot week to week, month to month,” Dimagiba said.

“We’re maintaining what we have said in our position paper. Without it [SRP], manufacturers may be prompted to increase prices to unreasonable levels,” he added. The DTI-CPG, in a letter on the DOJ-OFC study, said even

NONIE REYES

Continued from A1

with SRP in place, market forces and competition in the retail market should still dictate the price. “Historically, the monitored prices of basic goods and prime commodities are below the published SRPs,” the letter read.

Additionally, Dimagiba said retailers mostly receive show-cause orders and notice of violations for goods not covered by the SRP, as these are the ones with unstable price increases.

On the argument of the OFC that imposing price ceilings lead to supply shortage and hoarding of goods and services, Dimagiba said the statement is sound but “the assumption is too theoretical.”

“There has never been a case of supply shortage as a result of the SRP. The assumption is theoretical and there is no basis in the actual context of the Philippine market,” Dimagiba said.

Another voice of opposition, however, is being raised by a sector that is feeling the squeeze of the SRP scheme: retail.

As the SRP is set by manufacturers, retailers are left with a fixed profit margin, as they are bound to adhere to the price schedule.

While big supermarkets can negotiate with manufacturers to lower their wholesale cost so they can follow the SRP, smaller retailers are faced with these difficult choices: sell at a loss, don’t carry the items, or ignore the SRP. To be continued

news@businessmirror.com.ph

The Nation BusinessMirror

Editor: Dionisio L. Pelayo • Tuesday, August 11, 2015 A3

Comelec warned: Don’t be stampeded by Smartmatic

A

LAWMAKER has warned the Commission on Elections (Comelec) to avoid being pressured and stampeded into awarding the automation contracts for the 2016 national elections to the Smartmatic-Total Information Management (TIM) Corp. system consortium.

Nationalist People’s Coalition Rep. Rodolfo T. Albano III of Isabela lamented the inability of the Comelec to prepare for a full automation system for 2016 elections without the “intrusive presence and influence” of the SmartmaticTIM group.

Albano also expressed opposition on the Comelec’s plan to purchase new precinct count optical

scan (PCOS) machines instead of repairing the 80,000 machines in its warehouses, which the government had paid billions for already.

“If this plan is pursued, Smartmatic-TIM enjoys pole position as it has an ‘inside track’ in the poll body’s latest automation plan,” Albano said.

“It is evidently clear that the present Comelec, under the lead-

ership of Chairman Andres D. Bautista, is being pushed against the ropes by circumstances created by clearly inept and incompetent past leadership of the poll body, which approved a multibillion midnight contract with Smartmatic-TIM that the Supreme Court in a unanimous vote last April,” Albano added.

“Congress must step in to correct and help the Comelec in its predica-

ment, because the Smartmatic-TIM consortium continues to hold the Comelec as hostage over its plan to repair the 80,000 PCOS machines in its warehouses because of its claimed proprietary rights over the machines, and would not allow any other company to undertake the repair at a cost that it [SmartmaticTIM] dictated,” Albano said.

Jovee Marie N. dela Cruz

A6 Tuesday, August 11, 2015

Opinion BusinessMirror

editorial

Refinancing the debt

Y

ou might have a bank credit card that you use to make major purchases. Banks often offer zero interest rates on some purchases, particularly for expensive appliances. This might not seem like a good business practice, because banks are in the business of making money from lending and charging interest.

However, it actually makes sense and is a reasonable business model. The bank collects a service fee from the seller to handle the transaction. By offering zero interest, it is likely that the amount of sales increases and, therefore, the amount in service charges that the bank receives also goes up.

The bank is also able to show a strengthened balance sheet by increasing the amount of its receivables, even if the profit on those receivables is smaller than if it was generating income from interest.

From time to time, your bank may give you the opportunity to transfer your balance from one credit card to its own card by offering you a lower interest rate than what you are currrently paying. This is good business for the bank, and might offer you a way to save some money in interest charges. It makes sense to refinance your debt when you are offered lower interest rates.

Governments do the same thing by swapping debt. If it is cheaper to borrow today than it was a year or two before, then borrowing new money at a lower rate to pay off an older loan is smart.

For governments, another time to refinance is when there is reason to believe that there will be an increase in global interest rates in the near future. The Philippine government demonstrates the wisdom of this idea by announcing plans to refinance or swap as much as P300 billion of its debt.

The plan is to refinance short-term debt by issuing longer-term bonds with maturity dates of as long as 20 to 25 years, and mixing in an amount of 10-year bonds to replace shorter-term maturities. The other reason is that in the current interest-rate climate, with the possibility of an interest-rate increase in the US looming on the horizon, short-term debt is becoming increasingly illiquid.

Part of the problem is that short-term debt is experiencing an increase in interest rates because of the fear of a general rate increase. The interest rate on two-year debt is going up faster than the rate on 10-year bonds.

When benchmark interest rates move either higher or lower, the shorterterm debt reacts much faster than longer-term debt. For example, the 10year Philippine government bond is now paying 4.32 percent, while the 20-year maturity bond is only slightly higher at 4.62 percent.

This may not seem important at all, but the forthcoming debt swap is another example, and a good indication, that the Department of Finance and the Bangko Sentral ng Pilipinas have a good grasp in managing government finances.

A businessman’s take on the economy Manny B. Villar

THE Entrepreneur

Fourth of a series

T

he giant malls proliferating in Metro Manila and in more and more locations throughout the country are, literally, concrete proofs of the excitement and confidence of the tycoons.

The malls have become the new town plazas in the Philippines, according to a recent article by Agence France Presse (AFP), which was carried by major media outlets.

AFP noted that while Metro Manila remains the primary location, with 153 malls, the large shopping complexes are coming up even in the rural areas.

The development of communities outside Metro Manila as sites for malls reflects the increasing purchasing power of Filipino consumers in the provinces. This, I believe, can be traced to overseas Filipino workers, our modern heroes, many of whom come from the provinces. A large part of their billions of dollars in remittances go to their families in the

provinces, providing an expanding market for retailers and the malls.

Add to these the families of more than a million employees of the business-process outsourcing industry, and it is no wonder that the Philippines is now prominently on the radar screen of global retailers, which, in turn, increases demand for retail space, such as in the malls.

The tycoons are leading the expansion of the mall segment of the real-estate industry.

In terms of number of malls, Heny Sy’s SM is the undisputed leader. In May SM Prime Holdings opened its 52nd mall in the Philippines in San Mateo, Rizal. SM says the new mall, with 80,043 square meters (sq m) of gross floor area (GFA), brought the

SM mall chain’s total retail space to 6.61 million sq m, the largest footprint in the country.

With new projects ongoing, SM expects to end 2015 with 55 malls in the Philippines, plus six in China, with a combined GFA estimated at 8.27 million sq m. SM Prime has set a capital-expenditure (capex) budget of P66 billion for 2015 to finance mall development, as well as other projects, like hotels, office buildings and residential condominiums.

John Gokongwei’s Robinsons Land Corp., which is also expanding its mall presence outside Metro Manila, is scheduled to open five new malls in the provinces in 2015 and 2016. Robinsons currently has a network of 44 malls. Early this year, the company raised P12 billion from a bond sale to partly finance its P17-billion capex budget for its 2015 fiscal year.

Ayala Land Inc., which currently operates 16 malls, hopes to open eight new malls in 2015 and 2016.

Other mall developers are no less aggressive. Starmalls Inc., for instance, is pursuing a P26-billion, three-year expansion program for its mall network.

Starmall, which currently has six malls with a total GFA of 400,000 sq m, is targeting at least 1 million sq m of GFA with the construction of

new malls and expansion of existing shopping centers.

This year the company plans to open three new malls in Taguig, Bataan and Santa Rosa. In 2016 Starmalls will open another five malls, with an average investment of P1.5 billion to P2 billion each, in line with the company’s long-term vision to venture in community malls and create regional supercenters across the Philippines.

The construction of malls and other shopping centers in the provinces is opening up new markets for the retail business. This prevents the saturation of the Metro Manila market, while stimulating economic activities in other parts of the country.

Malls, together with other realestate projects, are changing the skyline in many areas, as well as the lifestyle of Filipino consumers.

There is a lot of room for expansion for the retail business, as consumer spending continues to fuel the country’s economy. This, in turn, continues to sustain the excitement of the tycoons, and their confidence in the future of the Philippine economy.

To be continued For comments, e-mail mbv.secretariat@gmail.com or visit www. mannyvillar.com.ph.

Raise the value-added tax, abolish the personal income tax John Mangun

OUTSIDE THE BOX

T

he following idea might, as well, have been written at 2 a.m. inside the Shanghai Moon Club under a cloud of smoke from the opium pipes. This “crazy” proposal could never happen in the real world: The personal-income tax (PIT) should be abolished.

These are the basic arguments in favor of a PIT. The government needs the money, and PIT is the easiest way to generate revenues. The second is that PIT is “progressive,” because higher income individuals pay a greater percentage of PIT than do low-wage earners.

The alternative to PIT—sales or valueadded tax (VAT)—creates a greater tax burden on lower-income groups.

An argument against the PIT is that it penalizes a person as he or she strives to earn more. If you make P200,000 per year in the Philippines, you pay 20-percent PIT. When you work harder to earn P500,000, you are then forced to pay PIT at 25 percent.

You work two-and-a-half months each year for the government when you are earning P250,000. At P500,000, you are working an extra month to pay your PIT. One rationalization for higherincome earners to pay a larger tax

rate is that supposedly the “rich” benefit more from public services than the “poor.” It is argued that the rich benefit more from the police and the military, because they have more material goods to protect from robbers and maybe the Chinese.

However, the rational for the PIT always comes back to the social view that the PIT is more equitable and fair than any other form of taxation. This concept of “fair taxation” is as slippery as a politician’s campaign speech, when the candidate talks about raising wages to labor groups and increasing investment incentives to a business group.

You might be surprised by this fact: Of all the government’s major regular revenue sources—PIT, corporate income tax, customs duties and VAT—PIT is the lowest revenue generator.

Here’s the total government revenue from all sources in 2014, according to the Department of Finance: P1.865 trillion.

Here’s the breakdown: Corporate income tax generated P484 billion. Customs brought in P408 billion. VAT created P378 billion in government income.

PIT contributed the least at P294 billion. According to the Commission on Audit, the government lost P101 billion to graft and corruption in 2011.

At least, we know where a third of the PIT is going.

The first argument against shifting from PIT to VAT is that consumer spending goes down during low economic growth periods and, therefore, the government would receive less revenue. This goes back to that medieval mind-set that the government is like the king who is entitled to a fixed share of the harvest, regardless if the people starve. It would be interesting to see the government practicing financial prudence during economic downturns, the same way that the people have to tighten their belts.

Perhaps, if government spending is done right, and corruption, waste and smuggling were eliminated, the government would not need the P300 billion from PIT. But, say, we just cut the PIT by 50 percent and make up the difference by raising the VAT. The standard VAT rate is 12 percent of the purchase. To make up for the shortfall of PIT revenue, total VAT collection would have to rise 40 percent. That would require raising the VAT rate to 16.8 percent.

Following this logic, an individual earning P250,000 annually would save P25,000 in taxes. Assuming that

P125,000 is spent on VAT-covered items, that would mean a person would pay about P15,000 a year at 12 percent. At 16.8 percent, the VAT payment would be P21,000, still less than the P25,000 savings when PIT is reduced.

But VAT is unfair to the lower-income earners, because they would pay a larger portion of their income in VAT than the “rich” do. This becomes a valid argument when we consider the way VAT is applied, not because VAT is unfair.

Consider: The VAT percentage on a cell phone priced at P2,000 is the same as the unit costing P40,000. That is what is not fair. To be fair, cut the VAT on the P2,000 phone by half and raise the VAT on the luxury phone that only the highincome earner can afford by 50 percent or more. The same principle should apply on all VAT-covered items, from a poor child’s P50 T-shirt to the rich person’s P1,500 designer T-shirt.

Increase the VAT rate to 16.8 percent but spread that tax rate through the price spectrum. But won’t the sales of designer T-shirts go down if the VAT gets adjusted this way? We doubt it would.

If you can afford a P1,500 T-shirt, it is unlikely that paying P200 more is going to stop you from buying the luxury item that you want.

E-mail me at mangun@gmail.com.

Visit my web site at www.mangunonmarkets.com. Follow me on Twitter @mangunonmarkets. PSE stock-market information and technical analysis tools provided by the COL Financial Group Inc.

Opinion BusinessMirror

opinion@businessmirror.com.ph

Another family feud threatens Korea’s economy William Pesek

BLOOMBERG VIEW

S

outh Koreans are probably experiencing a bout of déjà vu, as family rivalries wreak havoc at yet another chaebol, the family-owned business groups that dominate their economy.

In the early 2000s it was the Chungs of Hyundai feuding over their industrial empire. That scrap was settled only after Chung Juyung died in 2001 and the group he founded splintered into three parts, slamming the stock market and showing the world how far Korea needed to go to join the ranks of developed economies. Fourteen years on, Korea’s economy is still dominated by chaebols. This time, it’s the Shin brothers of Lotte, Korea’s eighth-largest business conglomerate, earning headlines as they brawl to succeed their 92-year-old father Shin Kyuk-ho.

Since the 1997 Asian crisis, every Korean president has pledged to retool the economy to prevent the kind of sibling battle now tearing up Lotte. Park Geun-hye, for example, was elected in December 2012 on promises to curb chaebol influence and diversify the economy. Park told voters she would unleash the “economic democratization” of Korea, by empowering smaller companies, ending deals where corporate patriarchs steer business to relatives, taxing the $2-trillion of cash hoarded by Korean executives and curbing crossholdings to weaken the grip of controlling families.

Lotte’s fiasco offers a perfect opportunity to push this agenda.

Unfortunately, Park’s vision for the second half of her presidency leaves little room for optimism.

Her August 6 call for companies to generate more jobs for young people suggests her government on working together with the chaebol, not breaking them up.

Rather than sidelining the tycoons championed after the Korean War by her father, dictator Park Chung-hee, she’s sought their help. In August 2013 Park sat down with the chaebol leaders she was supposed to be combatting, including Samsung’s Lee Kun-hee, whose own kids have been consolidating their hold over Korea’s biggest company since their father’s May 2014 heart attack. Park seemed to be offering the chaebol a quid pro quo: Help hasten gross domestic product and they won’t have to worry about too much government interference.

Economic change in traditionbound Korea will need to come from the top down—from Park’s office and the chaebol executive suite. But Seoul has made little

progress prodding chaebol to embrace global business practices.

Korean corporate managers are still rarely recruited from among the best and brightest; instead, they continue to be groomed from childhood, like the scions of a political dynasty. The results are catastrophic. In a more diversified economy, family feuds among business heirs would be little more than tabloid fodder, material for gossip sites like Gawker.com. In Korea they threaten to sink the country’s most critical companies and hold the national economy hostage.

To be fair, Park does deserve credit for her new labor-reform initiative. She’s right to push back against a national corporate culture that’s obsessed with seniority over talent. After all, youth unemployment (between ages of 15 and 29) is 10.2 percent, significantly higher than the 3.9-percent national rate. But the plan still lacks specifics, a problem that bedeviled her strategy to build a “creative economy.” Start-ups can’t just be ordered up by politicians; nor can the labor market be transformed by decree.

Samsung’s victory over activist investor Paul Elliott Singer to engineer a cozy merger between two of its companies shows how little changed since Hyundai scions squabbled, to the detriments of shareholders, in the early 2000s.

And Park’s indecisiveness, and her inclination to go easy on the spoiled sons and daughters at Samsung, Lotte and Hyundai, amounts to an endorsement of Korea’s ailing status quo.

Consider Hyundai’s most recent management pratfalls. Last year, as Park urged executives to adopt global practices, the son of the late Chung Ju-yung blew $10 billion on a new Hyundai Motor headquarters complex (paying three times the assessed value), irking foreign investors. And that was before Lotte’s Shin brothers offered their own reminder that the Korean economy isn’t ready for prime time.

Park, for her part, seems content to look on and let the chaebol have their way. “This is the time when we should make a decision for our daughters and sons, and for the future of the country,” she said last week. Koreans would be forgiven for wondering exactly whose sons and daughters she had in mind.

Revolt of the millennials Edgardo J. Angara

D

onald Trump, an outspoken real-estate magnate, has become the frontrunner among US Republican voters. He has bested well-established Republican names, like former Florida governor and presidential brother Jeb Bush and Wisconsin Gov. Scott Walker.

On the other hand, Hillary Clinton’s commanding lead among Democratic Party candidates is being eroded in part by rising interest in longtime Vermont senator and maverick Bernie Sanders, the longest-serving independent in US congressional history.

A Wall Street Journal analyst says that antiestablishment candidates

like Trump and Sanders are gaining traction because of an “unhappy and unsettled electorate.” Surveys indicate that American voters are discontented with the direction of the Obama administration, in particular, and in public institutions, in general.

This reflects the simmering “trust crisis” among politicians, political

Tuesday, August 11, 2015

parties and their constituents. A June 2015 Gallup poll showed that only 8 percent of Americans had confidence in their Congress—the second-lowest poll survey registered for any institution since it started measuring confidence ratings in 1973.

The European Union (EU) is experiencing similar alienation and lack of trust in mainstream politicians and traditional parties.

Since the decade of the 1980s, Spanish politics has generally been a two-party contest between the conservative Partido Popular and the left-wing opposition Partido Socialista Obrero Español. In the run-up to the November 2015 general elections, however, the populist antiausterity Podemos “We can” Party is emerging as a strong third-party contender. Podemos was founded in January 2014, but by November of the same year, it already bested both mainstream parties in surveys.

Where’s the anti-dynasty law?

Ernesto M. Hilario

ABOUT TOWN

F

ormer Chief Justice Reynato S. Puno is right: Congress should pass an anti-dynasty law. “There are no ifs or buts, the 1987 Constitution prohibits political dynasties. Unfortunately, the Constitution gave Congress the power to enact laws in order to implement this constitutional prohibition in 1987,” Puno said.

“It is now 2015, and instead of eliminating the dynasties, Congress has allowed them to flourish and to multiply. They are now reigning supreme in all our provinces, cities and municipalities. Their number must have broken a Guinness world record,” he added.

Here’s what the 1987 Constitution’s Declaration of Principles and State Policies in Article II explicitly provides: “The State shall guarantee equal access to opportunities for public service, and prohibit political dynasties as may be defined by law.”

The problem is that the members of Congress who are themselves part of political dynasties do not want to lose the power and influence they wield over their constituencies.

With political power, these entrenched politicians also wield economic power as they are able to accumulate wealth over time, whether through legitimate means or through corruption. Puno suggests changing the presidential form of government into a parliamentary system: “If we had a parliamentary form of government, this anomaly [political dynasties] would not have lasted.”

We really don’t know whether a parliamentary system will eliminate political dynasties, but it’s probably worth a try. Charter change, however, should be done through a constitutional convention duly

elected by the people, not through a constitutional assembly, where the very same members of Congress will decide their own fate.

Capampangan poems translated into Filipino

The Angeles University Foundation (AUF), in cooperation with the Komisyon sa Wikang Filipino, recently translated into Filipino my grandfather Zoilo Hilario’s Bayung Sunis, a collection of his poems in Capampangan.

This translation of his poems will, no doubt, allow readers beyond Pampanga to appreciate his literary work. These poems in Capampangan were written at a particular period in our history, the first half of the 20th century, or the period of American colonial rule. Hence, they reflect the prevailing conditions at the time.

In fact, Zoilo Hilario’s three other books of poems in Spanish manifested our people’s aspiration for freedom and independence, and placed emphasis on love of country or patriotism.

Research on the Internet led me to discover that Isaac Donoso, a Spanish national who earned his master’s degree at the University of the Philippines and is now a professor at the University of Alicante in Spain, analyzed our grandfather’s three books of poems in Spanish,

namely, Adelfas, Patria y Redencion and Himnos y Arengas.

And what was his conclusion? His conclusion was that Zoilo Hilario deserves to be considered among the best poets this country has ever produced. That few people outside Pampanga may even have heard of Zoilo Hilario as a leading poet of his generation is due to the fact that he wrote his poems in Spanish and Capampangan.

Our grandfather’s literary bent appears to have reached its full flowering in his early adult years. He was born in 1892 and later studied law.

His first book of poems in Spanish was published in 1911, or when he was just 19 years old. And to think that he wrote the poems while he was studying law and jurisprudence so he could earn a law degree.

Apart from being a poet, our grandfather served with distinction as a judge of the Court of First Instance and as a congressman in the 1930s. I am very glad, therefore, that the AUF has undertaken this literary project. Now, Tagalog readers can begin to understand Zoilo Hilario’s poems and what he stood for during his time.

Zoilo Hilario’s literary output may not have been as prodigious as those of other giants of Capampangan literature, or even those in Filipino or English. But in his own way, I believe that he contributed to a better understanding not only of life in Pampanga during his time, but also of the human condition as a whole.

His literary works should, therefore, be considered part of the cultural heritage not just of Pampanga, but of the nation as a whole.

We look back at the past to understand the present and prepare for the future. With this translation of Bayung Sunis, we can look back at our past from a fresh perspective, and, perhaps, allow us to see where we are now and where we are going.

The populist left-wing Syriza Party (Coalition of the Radical Left) of Greek Prime Minister Alexis Tsipras is a similar story. Greece went into a debt crisis, forcing the EU and the international financial lenders to prescribe austerity measures so severe that thousands of jobs, pensions and social services were cut. The Syriza Party won on the back of an antiausterity platform.

A wave of antiestablishment of populist political parties and politicians are chipping away at the dominance of more established mainstream centrist or conservative counterparts. Voters all over the world have been reveling against the ways of the old guards—riddled with double-speak and political charades.

We may be seeing the same trend happening here in the Philippines.

E-mail: angara.ed@gmail.com.

Czech books translated into Filipino Still on the subject of literature, Czech-Philippine relations in the field of art and culture continue to grow. Ample proof of this is that a translation-exchange program between the Philippines and the Czech Republic was recently launched. The Czech Embassy in Manila and the Komisyon sa Wikang Filipino (KWF) initiated the translation and publication of three Czech books in Filipino and reciprocally three books by Filipino writers in the Czech language.

A memorandum of understanding was recently signed by Virgilio S. Almario, chairman of the KWF, and Czech Ambassador Jaroslav Olša Jr. This is the first of its kind in the course of our bilateral relations.

The first joint project under the agreement is the publication by the KWF of a book-length selection of the best poems by Nobel Prize-winning Czech poet Jaroslav Seifert. This will be the second translation of a Czech writer published in the Philippines, following the Tagalog edition of the drama Memorandum ( A ng Memorandum) by the late Czech President Václav Havel, published in Manila in 1990.

As part of the agreement, a selection of short fiction and poems

by Philippine writers will be published under the title Literatura ng Pilipinas by the Czech literary monthly Plav.

This special issue of Plav magazine, which will come out in midAugust, will present both Philippine classics, as well as brand-new talents to Czech readers. Sometime next year, another anthology of works by modern and contemporary Philippine fiction writers will also be published.

E-mail: ernhil@yahoo.com.

Army institute at Fort Detrick moves away from vaccines and toward drug devt

By Sylvia Carignan | TNS

A

S the potential biological threats to US troops change over time— consider, for example, if the Ebola virus was used as a weapon—the missions of the research facilities on Fort Detrick have to change, too.

Officials at the US Army Medical Research Institute of Infectious Diseases (USAMRIID) on the Fort Detrick campus are working now, in fact, to look at potential gaps in their collective expertise as they move away from traditional vaccine research and toward development of drugs that could be used to treat deadly infectious diseases, such as Ebola.

Indeed, according to a June report from the Government Accountability Office (GAO), the nonpartisan research office of Congress, the Army institute at Fort Detrick is supporting the development of multiple products against Ebola, including the experimental therapeutic drug ZMapp, which was provided to American health-care workers infected with Ebola in Africa in 2014.

Because of the new kinds of

emerging threats, in 2012 a Department of Defense (DOD) office assigned the institute the responsibility of testing and evaluating medical countermeasures with an emphasis on new therapeutics, or drugs, that can fight lethal-disease outbreaks. And that involves research in the institute’s labs with the two highest levels of biocontainment standards, Biosafety Level 3 and Biosafety Level 4.

These involve work with the most deadly potential biological agents.

But USAMRIID officials are “concerned about a potential intellectual infrastructure gap” in its ability to accomplish those tasks, according to the June 15 GAO report, “Chemical and Biological Defense: Designated Entity Needed to Identify, Align, and Manage DOD’s Infrastructure.”

The institute continues to research vaccines and diagnostic tests, but a greater portion of its work is now focused on drug research and development, or therapeutics.

About 40 percent of the institute’s research is in vaccines, about 40 percent is therapeutics and 20 percent is

diagnostics, said Dr. Mark T. Dertzbaugh, director of Business Plans & Programs at USAMRIID. But he added, “There’s no intent to become a huge pharmaceutical company.”

Historically, USAMRIID’s mission has been to prevent soldiers in the field from contracting diseases by using countermeasures, such as vaccines. “As a result, our facilities, which were designed in the 1960s, were never intended to support therapeutic research,” the institute’s spokesman Caree Vander Linden said.

Dertzbaugh said this change reflects a more balanced approach to biological threats. To address the “intellectual infrastructure gap” between USAMRIID’s historic mission and its evolving one, the institute’s leadership is looking at the skills and abilities of their high-level personnel for any duplications, or gaps, in their knowledge. According to the GAO report, the institute expects this “Competency Management Initiative” to be completed this year.

Vander Linden said there are three main reasons for what the GAO calls a potential “intellectual infrastructure

gap”—an aging work force that is nearing retirement, competition for top-tier talent from private industry, and the need to align their work force with the DOD’s future needs.

Tracy Rossin, spokesman for MedImmune, which has facilities in Frederick, said the biotechnology company is responding to this generational gap by “taking new approaches” to finding experts, including looking outside the industry. The company also hosted a regional biotechnology forum in March to promote growth in the field and find methods of attracting, retaining and developing a talented work force.

At the Army institute, “We see the potential for an increased need for expertise in medicinal chemistry and imaging,” Vander Linden said. “We are continuing to assess those needs.”

The institute has a partnership with the National Institute of Allergy and Infectious Diseases Integrated Research Facility at Fort Detrick to share their imaging resources.

While USAMRIID has computer and specialized scan-imaging capabilities in

a Biosafety Level 3 environment, the Integrated Research Facility has imaging capabilities at Biosafety Level 4.

“The two laboratories are already collaborating on several fronts, and we expect that partnership will continue,” Vander Linden said.

Dr. Svetlana Chefer, an imaging scientist at the National Institute of Allergy and Infectious Diseases Integrated Research Facility, said the army institute may be able to help them with imaging rodents. A microPET machine—a positron emission tomography scanner that is designed for smaller animals—installed at USAMRIID may become part of their shared resources.

Chefer said NIAID-IRF generally uses clinical scanners, designed for humans, not preclinical scanners for animals, such as the microPET. “It doesn’t mean we can’t scan mice, but the resolution is not that good,” she said.

Increased use of imaging would help researchers determine a drug’s effect on the body, Dertzbaugh said, and would minimize the use of animals in research.

A7

The GAO report also gave a good summary of USAMRIID’s size and budget: Currently 20 buildings and more than half a million square feet of laboratory and support space, including 134,000 square feet of Biosafety Level 2, 3 and 4 laboratory space. The institute is the only DOD lab capable of handling Biosafety Level 4 agents, which are potentially fatal, and require the highest level of containment.

As of July 2014, USAMRIID maintained a staff of 841 personnel to support its work in biological defense research.

The Defense Department, according to the GAO report, estimated that the cost of sustainment and other support activities at USAMRIID is about $32.7 million in fiscal year 2015.

The new USAMRIID building on Fort Detrick, a massive structure with 950,000 square feet of space, including Biosafety Level 3 and 4 laboratories, is scheduled to be completed in 2017.

According to the GAO report, Defense Department officials said it would be a challenge to sustain the new facility without “stable, sustainment” funding.

2nd Front Page BusinessMirror

A8 Tuesday, August 11, 2015

Lump-sum funds in 2016 budget not ‘pork’–Abad

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By Jovee Marie N. dela Cruz

he Department of Budget and Management on Monday justified the lumpsum funds under the proposed P3.002-trillion national budget, saying these appropriations are not pork barrel.

Budget Secretary Florencio B. Abad, on the sidelines of the House Committee on Appropriations hearing on the 2016 budget, said there are only three lump-sum funds in the 2016 budget.

“There are only three lump-sum funds in the budget—the calamity fund with P19 billion, the contingency fund with P4 billion and ALGU [allocation for local government units] with more than P5 billion, which is the share of the local government in royalties,” Abad said, assuring the public that there is no pork barrel in these funds.

“As we have pushed for disag-

gregating lump-sum funds in the past, we are taking it further in the 2016 national budget. In addition to our commitment for greater transparency, credibility and accountability,” Abad added.

Abad also said his agency’s Unified Accounts Code Structure for tracking, along with a stronger monitoring and evaluation system, will ensure better tracking of financial information that will result in improved government spending.

However, in the same budget hearing, lawmakers criticized the presence of lump-sum funds in the annual budget.

Party-list Rep. Neri J. Colmenares of Bayan Muna said lump-sum appropriations, like the defunct Priority Development Assistance Fund (PDAF), are prone to abuse and misuse.

“So far, we noticed that there is P145-billion lump sum under the 2016 budget. We are expecting this to increase when we scrutinize the budget more,” Colmenares said.

In 2013 the Supreme Court declared the PDAF as unconstitutional.

Debt servicing

Party-list Rep. Terry L. Ridon of Kabataan questioned the continued priority given to debt servicing.

“Clearly, debt servicing remains to be the government’s top priority, not education, as the President purports in his budget message,” Ridon said.

Under the proposed budget, the total debt-service expenditure for 2016 is pegged at P740.5 billion, of which P392.79 billion is for interest payments and P347.7 billion is for principal amortization.

This debt-service expenditure is higher than the total P504.6 billion allotted for education next year. Debt service also comprises 5.3 percent of the projected gross domestic product

for 2016, while the education sector only gets 3.6 percent.

Meanwhile, the government intends to borrow P674.8 billion from domestic and external sources next year, P308.7 billion of which will be used to plug the projected fiscal deficit. About P347.7 billion of the targeted new borrowings will be used to pay for the amortization of the principal of the outstanding national government debt.

“Not only is debt servicing still the government’s top priority. The government is also set to borrow an additional P674.8 billion next year, not only to plug the targeted deficit —but also to repay debt. That’s the logic of the Aquino government: Repay debt with more debt,” Ridon said.

Party-list Rep. Fernando L. Hicap of Anakpawis said “the amount for debt servicing is significantly large, P25 for every P100 of the budget, the Filipino people, thus, are pressed to live with the remaining P75.”

He said the amount for debt service could construct about 600,000 classrooms and implement free irrigation for agriculture. The Philippines, Hicap said, is the only Asian country that charges fee for irrigation services.

www.businessmirror.com.ph

CHINA CUTS U.S.DEBT STAKE BY $180BILLION

T

o get a sense of how robust demand is for US Treasuries, consider that China has reduced its holdings by about $180 billion and the market barely reacted.

Benchmark 10-year yields fell 0.6 percentage point, even though the largest foreign holder of US debt pared its stake between March 2014 and May of this year, based on the most recent data available from the Treasury Department. That’s not the doomsday scenario portrayed by those who said the size of the holdings —which peaked at $1.65 trillion in 2014—would leave the US vulnerable to China’s whims.

Instead, other sources of demand are filling the void. Regulations designed to prevent another financial crisis have caused banks and similar firms to stockpile highly rated assets. Also, mutual funds have been scooping up government debt, flush with cash from savers who are wary of stocks and want an alternative to bank deposits that pay almost nothing. It all adds up to a market in fine fettle as the Federal Reserve moves closer to raising interest rates as soon as next month.

“China may be stepping away, but there is such a deep and broad buyer base for Treasuries, particularly when you have times of

uncertainty,” Brandon Swensen, the cohead of US fixed income at RBC Global Asset Management, which oversees $35 billion, said from Minneapolis.

Voracious appetite

America has relied on foreign buyers, as the Treasury market swelled to $12.7 trillion in order to finance stimulus that helped pull the economy out of recession and bail out the banking system. Overseas investors and official institutions hold $6.13 trillion of Treasuries, up from about $2 trillion in 2006, government data show.

China was a particularly voracious participant, boosting its holdings from less than $350 billion, as its economy boomed and the nation bought dollars to keep the yuan from soaring.

Now, the Asian nation is stepping back as it raises money to support flagging growth and a crumbling stock market, and allows its currency to trade more freely. The latest update of Treasury data and estimates by strategists suggest that China controls $1.47 trillion of Treasuries.

That includes about $200 billion held through Belgium, which Nomura Holdings Inc. says is home to Chinese custodial accounts.

Bloomberg News

EVOLUTION Three modes of popular public transportation, each representing

a different era, converge on the streets of the historic Walled City of Intramuros in Manila: an electric tricycle, a gas-powered tricycle and a horse-drawn calesa. nonie reyes

PHL to Apec: Help technopreneurs, MSMEs boost their share in growth Continued From A1

and move up the value-chain.”

“We have been continuously developing the required human resource pool in priority science and technology fields; establishing state-of-the-art laboratories, testing facilities, and innovation hubs; providing support for research and development; and create policies in intellectual property management, technology transfer, data and knowhow sharing, that promote and encourage innovation,” he said.

Montejo cited also that the Phil-

FDI. . .

Continued from A1

Across components, net equity capital placements reached $440 million as gross placements of $550 million more than offset withdrawals of $110 million during the period in the first five months of the year.

Meanwhile, reinvestment of earnings, essentially profits earned that have been plowed right back into the various endeavors, amounted to $318 million, while net placements in debt instruments settled at $879 million in January to May 2015. These

ippines pushed during the past PPSTI-5 a recommendation to translate STI into policy statement, since this is consistent with the Apec agenda and among the priority task of PPSTI in the coming years.

“We hope that the recommendation will see its fruition with the formulation and implementation of an action plan,” he said.

It should be noted that PPSTI provides a platform to foster collaboration and synergy among Apec membereconomies. It serves as a venue for formulating S&T-based policy recommendations and concrete actions to

enhance the capacity for and promote an environment conducive to innovation, Montejo said. “There is pressure for PPSTI to step up its programs and level of cooperation now that Apec recognizes and acknowledges the importance of STI,” he added.

The PPSTI delegates will visit some outputs of university-based research institutions that address problems in agriculture, industry, environment and climate change, including the R&D and innovations of the International Rice Research Institute that provide sustainable solutions to issues on food security.

were lower by 19.6 percent and 50.7 percent, respectively, compared to the levels recorded during the same period last year.

Equity capital placements emanated largely from the US, Germany, Japan, Singapore and the UK and were channeled mainly to financial and insurance; manufacturing, real estate; electricity, gas, steam and air-conditioning supply; and wholesale and retail-trade activities.

The positive, but still significantly lower, FDI compared to last year was brought about by significant capital outflows in January this year.

In a research note sent earlier this week, HSBC said investments, in general, slowed this year as fund managers prepare for when the monetary authorities in the US, still the world’s largest economy, begin to make appropriate interest-rate adjustments as its economy grows steadily stronger.

“The balance of payment, although still positive, has not grown substantially due to weak capital inflows and sluggish export performance. What are really keeping it anchored are steady remittance inflows and the service sector,” HSBC economist Trinh Nguyen said.