BusinessMirror August 12, 2015

TOMORROW ON

The Broader Look

SCRUTINIZING THE ELECTIONYEAR BUDGET

While it will only stay in power for half of 2016, the Aquino administration submitted a budget proposal that is 15.2 percent higher than this year’s P2.606-trillion national budget. Some fear this is meant to boost the ruling party’s 2016 election kitty through insertions in the budget.

The BM has The Broader Look on August 13.

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

U.N. MEDIA AWARD 2008

A broader look at today’s business Saturday 18,August 2014 Vol.12, 10 No. 40 Vol. 10 No. 307 Wednesday, 2015

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

EXPORTSECTORGIVESUP ON 8%10% TARGETAFTERRECORDING 4.7% CONTRACTIONINH1

Exporters lower 2015 growth goal to 3% B C N. P

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XPORTERS expect to recover from the 4.7-percent drop in export receipts in the first half of the year, still pegging a growth of up to 3 percent for 2015.

This projection was, however, a considerable downgrade from the original target of 8 percent to 10 percent for the year.

“We don’t normally change targets; but my own estimate is at 2 percent to 3 percent this year, because Europe, the US and China have not fully recovered. But now, I can say that the target [of 8 percent to 10 percent] is getting more difficult to achieve,” Philippine Exporters Con-

INSIDE

WINDOWS 10 FIXES 8

Your word and sacrament

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EAR Lord, help us stay with Your Holy Church. When we gather together to celebrate Your word and sacrament, may we know that it is Your voice we hear, and the gift of Yourself we receive. May we nourish and nurture our faith and not be afraid to proclaim it in word, thought and action. Heal our divisions so that we may be the sacrament of unity You desire. Let Your word and sacrament be the abiding force that bring Peace and Love into this world. Amen.

DAILY PRAYERS 2015, VIRGIE SALAZAR AND LOUIE M. LACSON Word&Life Publications • teacherlouie1965@yahoo.com

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

Life

TWITTER EXPERIMENTS WITH ‘NEWS TAB’ FEATURE »D2

BusinessMirror

Wednesday, August 12, 2015

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

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contrast, with Windows 8, many of those features were hidden; users had to know where to point their mouse or where to swipe with their fingers.

Perhaps best of all, Windows 10, unlike its predecessor, recognizes whether users are interacting with it on a touchscreen device or with a keyboard. If they switch between the two, Windows 10 will ask whether they want to switch its interface, as well.

Or users can instruct the software to make the change automatically. That’s a trick Windows 8 sorely lacked.

But Windows 10 isn’t just about fixing problems. It adds some new features, too. The most notable of these is Cortana, which is something like a combination of Google Now, Apple’s Siri voice assistant and the Spotlight search feature in Mac OS X. Similar to Siri, Cortana responds to spoken commands and queries, and like Spotlight, it can act like a search box. Like Google Now, it also provides, unprompted, information it thinks users might want to know, like the current weather in their city or the forecast for a city they will soon visit; the score of the latest game involving their favorite team; or when they need to leave to make an appointment, given current traffic conditions.

Users can customize Cortana by accessing a special “notebook” in which they can specify their favorite teams or types of food and what kind of information they’d like to see in their information feed.

Cortana generally worked well for me. But I found the way it handled search queries annoying; if it doesn’t have a ready answer, it will launch a new browser window for each query you type. I also was disappointed with its highlight feature—the ability to respond to voice requests. Although I use Siri fairly often on my iPhone, having a voice assistant on a PC isn’t as useful. That’s because the places where people frequently use their PCs are often public places, like offices or coffee shops, where it’s impossible to carry on a private vocal conversation with a computer. Windows 10 has other new and cool features. Taking a page from Apple’s OS X, Microsoft’s

SUGGESTED RETAIL PRICE SCHEME: BOON OR BANE?

new software will allow users to create multiple virtual desktops, allowing them to create a space for work-related programs and documents on one screen and personal stuff on another.

It also allows users to easily split the screen between two to four programs without having to adjust the window size of each one.

But the software also has some irksome quirks. For example, Windows 10, like Windows 8 before it, has multiple settings areas, and it’s often hard to know which one to use. I frequently found myself having to go between two or even three different interfaces to change a particular setting. Unlike Windows 8, Windows 10 will allow users to run older desktop applications in its tablet-oriented touchscreen interface. But it doesn’t reformat them for that interface— you’ll still see menus and buttons that were designed for mice not fingertips— and those apps don’t always run well within the tablet interface.

And users will likely encounter other bugs, as they would with any new version of software. I found some myself, including an annoying one that deleted what I was typing using Windows 10’s virtual keyboard as I was typing it. Still, for Windows 8 users— particularly those on traditional PCs— Windows 10 feels like a godsend. And even for other Windows users, it’s a worthy upgrade.

■ What: Microsoft Windows 10 operating system ■ Likes: Reinstated, revamped Start menu; ability to detect whether computer is in tablet or laptop mode and display appropriate interface; doesn’t force desktop users to interact with tablet-style interface; Cortana search and assistant feature; new notification and quick-setting area; ability to create multiple virtual desktops.

■ Dislikes: Multiple settings screens; some older Windows programs don’t work well in tablet mode; some annoying bugs.

■ Price: Free upgrade for current users of Windows 7 and Windows 8 for the next year; $120 to $200 for other users. ■

LIFE

D1

BusinessMirror

E1 | Wednesday, August 12, 2015 Editor: Tet Andolong

ILOILO Business Park by Megaworld

BPOs, CONDO DEVELOPMENT DRIVE

PROPERTY SECTOR GROWTH LANANG Business Park in Davao

B R R R

OR 10 straight years, the Philippine property sector experienced good times and, according to a leading property expert, the good news is that it will continue to grow.

In a recent interview with the BusinessMirror, Ateneo program director for real estate, Professor Enrique Soriano III, said that the industry will continue to experience growth in the demand for housing and office spaces, especially for the business-process outsourcing (BPO) industry outside of the traditional commercial business districts. “The expansion of the BPO industry will be felt in provincial cities such as Iloilo, Cebu and Davao,” said Soriano, who is also a turnaround advisor

for Asian markets in the Wong and Bernstein advisory group.

The IT and Business Process Association of the Philippines (Ibpap) recently reported that the BPO industry achieved 18.7-percent growth in revenue approximately amounting to $18.4 billion in 2014. The organization cited the rising demand for services from the global offshoring industry, health-care information management, global in-house centers plus gaming and animation.

Moreover, the Ibpap said it is opti-

mistic that the industry is on track to achieve $25 billion in revenues and reach the 1.3 million employment level by 2016.

Meanwhile, property management and consulting firm CBRE Philippines recently pointed out in a recent media briefing that the office sector, in particular, posted a strong performance toward the end of 2014 and will likely post further gains this year.

He cited that the continued demand for BPO services, political stability and positive economic growth indicators as the drivers for the industry’s continuous growth this year.

According to CBRE data, vacancy rates in major Metro Manila office buildings remained under 3 percent. By the end of 2014, the vacancy rate dropped from 2.53 percent to 2.13 percent quarter-onquarter, CBRE said. During this period, Metro Manila lease rates rose by 2.6 percent.

Although some analysts believe the property sector is already ripe for correction, Soriano said the overall outlook will still be bullish.

“Depending on which asset classes,

ACC Corporate Center in Cebu

overall the sector is still robust but admittedly the less aggressive players and new entrants in the massmarket condominium segment have faltered and have registered slow year-on-year take up in sales performance,” Soriano said.

“The bigger and more diversified players have cornered a bigger market share and are expected to dominate the property scene this year and [in] 2016. This natural dominance by the major players is expected when the property cycle transitions to the mature phase in mid-2015,” Soriano added.

On the part of the government, Soriano said the Bangko Sentral ng Pilipinas (BSP) has been in the forefront of monitoring local banks’ exposures in the real-estate sector. Moreover, he said the BSP has cautioned banks to temper borrow-

ings, especially to new players that are inexperienced. “The BSP has initiated metrics by having Banks undergo stress tests to determine fundamentally sound ratios and capability to manage a real-estate portfolio,” he said.

As far as the possibility of a slackening of demand is concerned, Soriano said there will be a slowdown in the market starting 2016 as the remaining units will be completed. “There is going to be deceleration in 2016. But this will be limited to select areas and a specific class,” Soriano predicted.

Soriano stressed that end-users, investors and developers should not expect the current boom to continue in the succeeding years.

“Perhaps, what we should caution the end-users, investors and developers is the wrong notion of

assuming that recent price performance will continue into the future without fi rst considering the long-term rates of price appreciation and the potential for mean reversion,” he said.

For end-users, Soriano said that the buyers should be educated. He suggested that they should gather all the information they need before signing a contract. Further, he said end-users should evaluate their requirements and scrutinize thoroughly the track record of the developer.

For developers experiencing slow take up, Soriano said they should expect lower velocity in the coming months. “The next best option for them is to review their strategy, revisit their structure and invest on the right operating executives,” he advised.

SOUTHERN LUXURY THRIVES AT VERSAILLES F

WATER can heal the senses, especially in a luxurious swimming pool complex.

RENCH extravagance finds a home in the south with State Properties Corp.’s (SPC) first premier residential estate. Versailles is a majestic 75-hectare high-end gated enclave just across Ayala Alabang Village. Once completed, the new development will offer discerning homeowners a life of opulent comfort and prestige.

Inspired by its namesake, the Château de Versailles in France, Versailles is a richly designed paradise, with its stately Mediterranean-influenced homes and manicured lawns, making it one of the most beautiful communities in the country.

The model houses and townhomes, designed by Palafox Associates and Rolando Mercado Design Associates, present a modern take on classic European elegance, with

spacious bedrooms, vast windows and intricate interiors that make the living spaces sophisticated, elegant and timeless.

Its pedestrian-friendly neighborhood, tight security system and generous open spaces make it ideal for growing families, and the flood-free community allows residents to come home with ease during typhoon seasons. The clubhouse is a world-class facility that provides residents a lifestyle of wellness. Offering the refinements of European sophistication, residents can work out in the gym or relax at the spa with its massage rooms and wet and dry sauna.

No need to go far for a swim with the swimming pool complex, which consists of a lounge pool, kiddie pool, deep pool, lap pool, wading pool and a Jacuzzi. Friendly tournaments can

be held at the basketball court and tennis lawn, while the playground and leisure parks are ideal for picnics and precious family moments.

Marvel in the grandeur of Versailles’s lighted colonnades with a magnificent dancing fountain and a beautifully landscaped entrance that will delight you upon your arrival.

The splendor of the ballroom crystal chandelier inside the Versailles Palace completes every detail that matters for that perfect romantic setting for brides and debutantes. It has been the stage for regal affairs, hosting big events, such as the 2012 and 2013 Miss Earth International Grand Coronation Night.

Located in the quiet part of the city, near Alabang, and surrounded by some of the country’s premiere estates, Versailles is conveniently situat-

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PROPERTY SECTOR GROWTH

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ed along Daang Hari, Las Piñas, and is a mere 15-minute drive (via the Skyway) to the Makati central business district and the Ninoy Aquino International Airport.

Versailles is a premium property development by SPC, the real-estate arm of State Investment Trust Inc. (Siti).

Siti has over 50 years of extensive experience and corporate stability to deliver on its promise of quality projects and investment value. Versailles, its first high-end residential development, provides an inimitable lifestyle in Metro Manila’s south and reflects SPC’s uncompromising standard for aesthetics and function. SPC developed Versailles’s master plan with Palafox Associates, one of the Philippines’s leading architectural and design firms. www.versailles.com.ph

PROPERTY

C  A

SPECIAL REPORT

D1

WINDOWS 10 FIXES THE MISTAKES OF WINDOWS 8 INDOWS 10, the latest version of Microsoft’s operating system, upholds the adage about the company’s flagship product—every other release is good.

Released last week, the new software replaces the unloved and unpopular Windows 8 and is designed to correct many of that version’s mistakes. Windows 10 has its own shortcomings, but it’s a heck of a lot less frustrating and much more satisfying to use than its predecessor.

The biggest change Microsoft made with Windows 10 isn’t a new feature or a tweak to the software, but something that might be thought of as an attitude adjustment. Microsoft has belatedly recognized the importance of traditional keyboard-and-mouse PC users.

The company gave such users shortshrift with Windows 8. That software, which debuted amid the rising importance of smartphones and tablets, was created with those devices in mind.

By comparison, Windows 10 feels and acts like a more traditional Windows operating system. The desktop is back to being front and center. The Start menu is back and better than ever. The “modern” interface of Windows 8 has been demoted to a feature within that menu, rather than a substitute for the desktop. And users can again view applications as windows and stack them one on top of the other, regardless of whether they are Windows 8-style apps or Windows programs. Even better, most of Windows 10’s features are easy to access with a simple mouse click.

As with other versions of Windows before Windows 8, Windows 10 has an always-present taskbar that includes traditional, dedicated buttons for things like networking and volume control. It also has new buttons that can show recent alerts, allow users to quickly adjust certain settings and even allow users to switch between currently running applications. By

federation Inc. President Sergio R. Ortiz-Luis Jr. said in an interview.

Ortiz-Luis said this may be the country’s slowest export growth since 2011, when the sector recorded a 6.9-percent drop in revenues.

“We can’t say for certain when it will recover. Electronics exports have helped, of course, but even they have revised their growth projection,” Ortiz-Luis added.

E1

Conclusion

HILE the Department of Trade and Industry (DTI) maintains that stopping the implementation of the Suggested Retail Price (SRP) scheme may give way to undue and sudden hikes in the prices of basic commodities, retailers are on the other side of the argument.

Allowing market competition to determine prices and limiting the application of the SRP scheme to ease the burden of retailers to stick to unreasonable profit margins should be the way to go, retailers said.

Retailers are supporting the Office for Competition’s (OFC) recommendation to only apply

the SRP mechanism during times of emergencies, as the scheme may be impeding competition.

In an e-mail interview, Steven Cua, president of the Philippine Amalgamated Supermarkets Association (PAGASA), expressed support on the findings of a recent study on the SRP conducted by the OFC, an attached agency of the Department of Justice.

“We acknowledge that the DTI is trying to protect the interest of the buying public.

But it may have stepped over the line, as prices of select [and expanding set of] commodities are controlled, thereby, somehow impeding the natural flow of goods in our economy. This may somehow affect the actual movement of goods and growth C  A

HEALTH-CARE DIALOGUE UK Trade and Investment Director Iain Mansfield (second from right) leads the British Embassy Healthcare Dialogue addressing the challenges and solutions in achieving quality health care in the Philippines. Joining him are (from left) GSK General Manager Francis del Val, GE Philippines Country Manager Ivan Arota and Health Undersecretary Dr. Kenneth Hartigan-Go. ALYSA SALEN

Ayala Land wins ITS South auction B L S. M

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ROPERTY developer Ayala Land Inc. topped the auction for the P4-billion contract to build and operate an intermodal terminal near the Food Terminal Inc. (FTI) Complex in Taguig City.

Tuesday’s opening of bids for the multibillion-peso Integrated Transport System (ITS) South Public-Private Partnership deal saw Ayala Land seeking an annual payment of P277.89 million. This is significantly lower than Filinvest Land Inc.’s bid that sought a P1-billion yearly subsidy to build and operate the facility.

Transportation Undersecretary Jose Perpetuo M. Lotilla said his camp is still happy with the turnout

of the bidding, despite the parties seeking annual grantor’s payment, instead of offering premiums, as in other auctions.

“The government welcomes the lowest bidder, because that is the amount that will be paid by the state.

I think we have a good deal with the amount that they are charging,” he said after the auction activities.

It did not come as a surprise, however, as the first auction for this kind of project was also met with such participation. Megawide Construction Corp. bagged the P2.5-billion ITS Southwest Terminal deal earlier this year, seeking an annual grantor’s payment of P100 million.

“It depends on their projections.

Remember that under the terms, they are supposed to provide cer-

tain number of slots. If they have other enhancements in mind, it is possible that their project cost is higher,” Lotilla explained, referring to the design of the terminal.

The winning bidder will take care of the design, construction and operations, and maintenance of the terminal for a concession period of 35 years.

The multibillion-peso project covers the construction of a terminal within a 4.7-hectare lot on the FTI compound in Taguig. It will connect passengers coming from the South, specifically the Batangas and Laguna areas, to other publicutility vehicles that are serving inner Metro Manila.

It also covers the construction C  A

January-July auto sales up 20.3% as industry gears up for peak months

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HE local auto industry had a strong start for the second half of the year, notching an 18.5-percent sales hike to 24,569 units in July.

This put year-to-date sales growth at 20.3 percent, according to a joint report of the Chamber of Automotive Manufacturers of the Philippines Inc. (Campi) and the Trucks

Manufacturers Association.

Total sales from January to July reached 156,034 units, with market leader Toyota Motor Philippines Corp. (TMPC) again leading the industry’s performance.

Sales of the Japanese auto brand in the first seven months of the year grew 16.6 percent to 68,395 units, from 58,635 units in

PESO EXCHANGE RATES ■ US 45.7300

the same period last year. TMPC sold 10,678 units in July, topping its previous record in May of 10,511 units. This was driven by its popular models the Vios, Innova and Wigo.

Toyota’s market share is at 43.8 percent.

“This is a very good start for the second semester, which normally accounts for a bigger share of the whole year’s target,” said

lawyer Rommel Gutierrez, Campi president and vice president of TMPC. Passenger-car sales grew 23 percent in July to 10,221 units. Commercial vehicles, on the other hand, posted a 16-percent sales hike in July to 14,248 units.

“We are confident that the market will remain strong, and the industry will respond

by bringing in new stocks in preparation for the demand peak toward the end of the year,” he added. Mitsubishi Motors Philippines Corp. has the second-biggest market share, with 19.1 percent, followed by Isuzu Philippines Corp., 7.9 percent; Ford Motor Co. Philippines Inc., 7.8 percent; and Honda Cars Philippines, 6.7 percent. Catherine N. Pillas

■ JAPAN 0.3671 ■ UK 71.2839 ■ HK 5.8988 ■ CHINA 7.3643 ■ SINGAPORE 33.1185 ■ AUSTRALIA 33.8215 ■ EU 50.3807 ■ SAUDI ARABIA 12.1944 Source: BSP (11 August 2015)

A2 Wednesday, August 12, 2015

BMReports BusinessMirror

news@businessmirror.com.ph

Suggested retail price scheme: Boon or bane?

Continued from A1

of companies,” Cua said.

“SRPs are meant for emergencies where they apply in affected areas only. This is to curb the impulse of some traders to take advantage of a lack of supply of goods, thereby, artificially jacking up the prices of these goods in view of an uptick in demand for them,” Cua added.

The study by the OFC finds an alleged “misapplication” in the implementation of the SRP scheme, and tags it as impeding competition.

The SRP scheme, implemented by the DTI and five other agencies, involves setting a price schedule on certain brands and units of basic and prime goods. The SRP already factors in distribution cost, production expenses and profit margins.

The price schedule represents the maximum price that can be charged for a particular unit and brand covered by the

scheme. Manufacturers submit this SRP schedule and the DTI approves it through its own analysis.

It is the retailers, however, that are at the receiving end of the DTI’s strict enforcement of the SRP. The Fair Trade Enforcement Bureau of the DTI issues show-cause orders and notice of violations to erring retailers.

Moreover, for retailers, the SRP ties their hands in setting a reasonable profit margin.

“There have been products with margins of 1.3 percent from list price to the retailer.

No retailer will survive with margins like that. Just the charge of credit-card companies to food retailers/merchants alone can be as high as 1.5 percent,” Cua lamented in the same e-mail interview.

But the DTI contends that most goods covered by SRP are priced way below the set SRP, allowing for enough room to adjust the retailers’ margin.

Retailers are also getting some discount in volume sales, Trade Undersecretary for Consumer Protection Victorio Mario A. Dimagiba said.

Retailers assert that market forces, unimpeded by government intervention, will keep the prices of goods on an even keel.

“I understand that the DTI is probably wary of cartels and collusion among manufacturers of a product category. However, competition in a free economy, especially now that Asean Free Trade Area is at hand, will keep prices of commodities where they belong. Meaning, because of increased variety and brands of goods in the market, manufacturers will very likely have to position the prices of their goods so as to make them competitive and attractive to the consuming public,” Cua added.

Retailers also feel as if they’re getting the short end of the stick, as they claim that the consultation with them on the SRP schedule has stopped.

“The DTI used to consult the supermarket association regarding the SRPs supplied to them by manufacturers, to ask us if these are fair and just to us, before they actually post their list of SRPs. Now, they do not do that anymore to our great disadvantage,” Cua added.

The Pagasa head suspected that this is a move of manufacturers to dictate the prices for retailers to follow, thus, making their brands preferred and attractive to the consumers but is “grossly unfair to the retailer.”

Supermarkets then have to either not carry the items covered, or carry them at a loss. Most retailers choose the latter as the items covered by the SRP are “must-have” items, or market leaders in their categories, Cua explained.

On the OFC’s recommendation to implement the SRP during emergency, Dimagiba said different forms of price control (price freeze or price ceiling) are already in effect

during those times, thus, making the imposition of SRP useless.

Moreover, the DTI emphasizes that the approval process before manufacturers increase prices is necessary to keep prices steady and at a reasonable level.

For the OFC, however, the direction still for the SRP should be toward reform.

“We’re setting the debate for discussion for price control or SRP. The DOJ and DTI are partners in this discussion, but you see the debate [in the study] on how we design our pricing mechanism as to what to include and what not to include,” DOJ Assistant Secretary and OFC Head Geronimo L. Sy said.

“We look at it as a constructive form where we can move forward with whether we refine, fine-tune, rename, abolish or set up another system for SRP,” he added.

According to the assistant secretary, they are set to have an internal meeting with the DTI on the SRP mechanism.

Exporters lower 2015 growth goal to 3%. . .

Export revenues from January to June declined to $28.8 billion from $30.23 billion in the same period last year.

Export earnings also contracted 3.3 percent to $5.28 billion in June 2015 from $5.46 billion in June 2014. This was the third consecutive month of decline since export revenues posted a growth of 2.06 percent in March.

“Weak external demand continues to affect the country’s external trade performance, particularly for the merchandise exports sector. Year-to-date outcome, in terms of both value and volume, suggests

fragility in the demand, particularly in major trading partners,” Socioeconomic Planning Secretary Arsenio M. Balisacan said.

The decline in other major commodity groups overshadowed the gains in electronics exports, which posted a growth of 9.5 percent in June 2015. Earnings from the shipment of electronic products amounted to $2.44 billion, higher than the $2.23 billion registered in June 2014. It accounted for 46.2 percent of the total exports in June 2015.

“The country’s relatively strong semiconductor exports emulated the progress in the global semiconductors market as worldwide

sales continued to expand at its 26th consecutive month, as reported by Semiconductors Industry Association,” Balisacan said.

The country’s top export markets in June were Japan, which accounted for 23.4 percent share to total exports for June 2015, followed by the US with 13.6 percent and China, 11.4 percent.

Exports to Japan reached $1.23 billion. It increased by 29 percent from $956.14 million in June 2014.

Shipments to the US amounted to $720.35 million in June 2015. It, however, recorded a decline of 4.3 percent from $752.39 million

in the same month last year.

The country’s exports to China were valued at $600.92 million in June 2015. It declined 30.2 percent from $861.28 million in the same month a year ago.

Revenues from the country’s agricultural exports continued to fall in June 2015, marking its fifth consecutive month of doubledigit decline for the year. The value of outward shipments of agro-based products fell by 24.9 percent on account of lower revenues from fruits and vegetables, sugar and coconut products and other agro products.

Similarly, exports of mineral products de-

Continued from A1

creased by 26.2 percent in June 2015 due to lower earnings from copper metal and other mineral products. Also, mineral product exports to the country’s top markets posted steep declines in June 2015, particularly China, Switzerland and Thailand.

“In addition to the frail demand from major economies, the country’s recent external trade performance is also partly due to an abundant supply of industrial commodities, thus, revenues from mineral and agro-based exports are seen to continue to decline in the short term due to falling prices,” Balisacan said. With Cai U. Ordinario

Economy

A4 Wednesday, August 12, 2015 • Editors: Vittorio V. Vitug and Max V. de Leon

DBM allots P129.3B for disaster readiness

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udget Secretary Florencio B. Abad said on Tuesday the government’s disaster-risk management program will receive a total of P129.3-billion budget allocation for 2016 to prepare the country in the event of natural calamities.

The amount, which increased by 4.3 percent from the current year, includes measures on climate-change adaptation and disasterrisk mitigation.

Of these funds, a total of P38.896 million will be allocated for the National Disaster Risk Reduction and Management Fund (NDRRMF).

The funds include the P18.896-million allocation for the Yolanda rehabilitation and recovery program for 2016; the remaining P19 million for NDRRMF; and P1 million for the People’s Survival Fund.

The budget chief presented to Congress on Monday the proposed P3.002trillion national budget for 2016, with the bulk of the funds intended for economic and social services.

Abad earlier said the government has released a total of P88.96 billion for the Yolanda relief and rehabilitation operations.

“For the second half of 2015, the DBM [Department of Budget and Management] plans to release P14.05 billion more for post-Yolanda rehabilitation work. The release will be tapped from available 2015 fund sources, such as the Rehabilitation and Recovery Program, the Unprogrammed Fund, and savings from various agencies,” Abad said. Estrella Torres

BusinessMirror

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SPI’s Steag Unit 2 restoration seen to improve Mindanao power supply

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By Lenie Lectura

to be carried out as part of the company’s continuing commitment to ensure quality and longterm plant performance.

“Periodic preventive maintenance of our units is an important and necessary strategy to ensure that we have efficient and reliable plant operation. The goal is to provide Mindanao with a more sustained and stable electric-power supply in the long run,” Evers said.

“We are happy to note that the maintenance activities were carried out smoothly as planned and even restore the unit back to the grid way ahead of schedule,” Evers added.

Meanwhile, SPI President and CEO Dr. Bodo Goerlich said the restoration of the power plant’s full

indanao’s power supply is expected to improve with the restoration of Steag State Power Inc.’s (SPI) Unit 2 coal-power plant.

SPI Power Plant Manager Dr. Carsten Evers said Unit 2, with a capacity of 105 megawatts (MW), was synchronized to the Mindanao grid at around 1 p.m. on Tuesday, five days earlier than schedule.

With the resumption of the second unit, SPI’s power plant now contributes a total of 210 MW to the said grid.

SPI’s 210-MW coal-fired power plant at the Phividec Industrial Estate in Villanueva, Misamis Oriental, is composed of two identical units, each has a power-generating capacity of 105 MW. Unit 2 went offline on July 18 for a scheduled preventive maintenance.

Evers explained that preventive maintenance activities have

capacity is expected to help improve the volatile power-supply condition in Mindanao.

“With the full operation of SPI’s power plant, we anticipate improvements in the power-supply condition of Mindanao and ease up power shortages in some parts of the island,” Goerlich said. “SPI remains committed to help secure for Mindanao a reliable source of electric power necessary to propel its economic growth and progress.”

Earlier reports indicate that the Mindanao grid was on redalert status with a power, reserve deficiency of more than 165 MW based on the island’s estimated system’s peak demand of nearly 1,300 MW.

SC asked to stop grant of multibillion-peso claims of Maynilad and Manila Water

By Joel R. San Juan

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PETITION has been filed before the Supreme Court (SC) seeking to stop the government from granting the claims of water concessionaires Maynilad Water Services and Manila Water Co. Inc. for sovereign guarantee amounting to P3.44 billion and P79 billion, respectively.

In a 64-page petition, the Bayan Muna Party-list group, led by Rep. Neri Colmenares and Isagani Zarate, also asked the SC to eventually declare as unconstitutional Article 12 of the concession agreements, which respectively provides for the submission of disputes to arbitration and the express waiver of the state’s right to appeal.

The said provisions, according to the petitioners, violate various provisions of the 1987 Constitution, such as Section 6, Article XII (mandates the government to promote distributive justice and to intervene when the common good so requires); Section 1, Article III (insofar as these contravenes the water-consuming public’s right against deprivation of property without due process); Section 1, Article VIII (insofar as it nullifies the SC’s power of judicial review) ; Section 19, Article XII (as it contravenes the state’s duty to subject monopolies to strict state regulation); and Republic Act 6234 (Manila Waterworks and Sewerage System) Charter (insofar as arbitration effectively takes away the agency’s power and duty to regulate the water-sewerage system).

The petitioners also sought to declare as null and void for being unconstitutional the Letters of Undertaking executed by the government in connection with the concession agreements.

They also asked the SC for the exclusion of corporate income taxes of both Maynilad and Manila Water from allowed expenditures under the concession agreements, thus, cannot be passed on directly or indirectly to the water consumers.

They insisted that the two water concessionaires are considered public utility, thus, governed by the provisions of the Public Service Act. Being a public utility, the partylist solons argued that Maynilad and Manila Water are subject to state’s regulation and cannot be

subject to arbitration.

“Verily, only through strict state and public regulation can the interest of the water-consuming public be truly protected from the evils and greed for profit of a monopolistic private water and sewerage system provider,” they added.

Likewise, the petitioners said the SC should declare as unconstitutional the “Sovereign Guarantee” embodied in the Letters of Undertaking executed by the government in relation to the concession agreements.

The petitioners said soverign guarantee violates the people’s constitutionally assured due process rights and essentially thwarts the powers of the SC and the MWSS to regulate public utilities.

Aquino, Abad told: Stop disbursement of funds for ‘illegal’ pork-barrel projects

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resident Aquino and Budget Secretary Florencio B. Abad should stop the disbursement of funds for

illegal pork-barrel projects and instead provide money for the salary increases of 1.4 million government employees.

Party-list Rep. Antonio L. Tinio of ACT Teachers noted that while there is P50.664 billion in the 2016 budget under the Miscellaneous Personnel Benefits Fund (MPBF) for “Lump Sum for Compensation Adjustment,” the Aquino administration still has not presented to the Congress its concrete proposal for a new compensation structure to replace the Salary Standardization Law 3 (SSL 3.)

All that Abad can tell Tinio during the hearing at the House of Representatives was that the administration will present its “Executive proposal” for a revised SSL 3 but could not say when this proposal would be submitted.

Tinio stressed that salary increases should have been implemented in January 2016 and not in July 2016.

While Aquino and Abad had been dragging on the salary increases for government personnel, they were quick in providing money for pork barrel projects that the Supreme Court (SC) declared as illegal in 2013.

Tinio revealed that P4.826 billion in the 2015 budget was allocated for congressional insertions based on the National Budget Circular (NBC) 556 that Abad issued on January 5.

This expenditure is in direct violation of the SC decision against the pork barrel, euphemistically called Priority Development Assistance Fund (PDAF.) No less than nine senators, includ-

ing senators Alan Peter S. Cayetano and Antonio F. Trillanes IV also made such insertions in the 2014 budget in contravention of the High Court’s verdict, with one senator alleged to have benefited from P1-billion worth of projects.

Porkless

Malacañang has vowed to comply with a Supreme Court ruling outlawing the pork barrel, reaffirming its commitment to strike down any attempt to revive it in the P3.002-trillion 2016 budget the Palace submitted to Congress last week.

Communications Secretary Herminio B. Coloma Jr. confirmed on Tuesday that President Aquino remains firm in his position against any revival of pork barrel allocations for lawmakers through congressional amendments in the Palace-endorsed budget bill that the High Court earlier ruled as unconstitutional.

Coloma, however, sidestepped a question on whether Mr. Aquino would veto the reported P4.8 billion congressional insertions in the 2016 budget seen as a circumvention of the SC ruling banning the pork barrel allocations for lawmakers.

“As Budget Secretary Florencio B. Abad told Congress yesterday there is no pork barrel in the proposed 2016 national budget,” Coloma recalled.

Marvyn Benaning, Butch Fernandez

Ayala Land wins ITS South auction continued from a1

of arrival and departure bays, public information systems, ticketing and baggage facilities and park-ride facilities.

Sought for comment, Ayala Land Spokesman Alfonso Javier D. Reyes said his group is elated with the turnout of the auction.

“This is an important project for us because we’re developing Arca South, so we feel this a very strategic project and it’s a good project for the country to help declog Metro Manila; and so we’re very happy with the result of the bid today [Tuesday],” he said in an interview.

Arca South is an integrated mixeduse estate.

It is estimated that up to 4,000 buses and 160,000 passengers will feed into ITS South from the South Luzon Expressway every day.

“We like to view it as part of the whole, as it is right beside Arca, it is very strategic,” Reyes said.

The transport agency aims to award the project some time this August so construction can begin by May 2016. The terminal is set to open in october 2017.

Economy BusinessMirror

news@businessmirror.com.ph

Wednesday, August 12, 2015 A5

Manufacturing output shrank by 3.6% in June–PSA

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By Cai U. Ordinario

he country’s manufacturing output contracted 3.6 percent in June 2015, according to the preliminary results of the Monthly Integrated Survey of Selected Industries (Missi).

Data from the Missi, released by the Philippine Statistics Authority (PSA) on Tuesday, showed that the Volume of Production Index (VoPI) in June declined from the 12.7-percent growth posted in the same period last year.

PSA data also showed that the VoPI growth has posted contractions for the whole of the first semester of 2015, except for January and March.

In terms of value, Missi data showed that the Value of Production Index (VaPI) also declined with a contraction of 7.3 percent.

The PSA also said that, like the VoPI, this was also a reversal from the double-digit growth of 10.1 percent posted in June 2014.

“Despite these figures, there is a sustained positive outlook

for the construction-related sectors backed by brisk construction activities.

This is fueled by the growth of tourism, continued implementation of infrastructure-related government projects, and robust information technology and businessprocess outsourcing,” National Economic and Development Authority (Neda) Director General Arsenio M. Balisacan said.

“This will result in additional demand for offices and other facilities, housing spaces, roads and bridges.

Furthermore, low inflation environment and continuous decline in oil prices are expected to keep construction costs at minimal level,” he added.

The Neda, however, said that in terms of consumer goods, the volume and value of net sales in furni-

ture and fixtures grew by 61.4 percent and 37.6 percent, respectively, in June 2015.

Data showed that the year-onyear growth for tobacco volume and value of net sales continued to climb at 10.9 percent and 11.9 percent, respectively.

The food subsector, on the other hand, continued its double-digit year-on-year drop of 12.5 percent and 12.7 percent in volume and value of production, respectively.

The Neda said this was due to the effects of the decline in world milk prices, as well as reduced imports from China and ban in Russia.

As for intermediate goods, production and net sales of nonmetallic mineral products demonstrated a double-digit year-on-year growth of 28.5 percent and 24.5 percent in volume, and 18.7 percent and 14.9 percent in June 2015, respectively.

“The growth in this subsector is owed to the increasing demand from infrastructure-related government projects and the growing tourism, information technology and business process outsourcing industry,” the Neda said.

In terms of capital goods, the Neda said the collective double-digit year-on-year growth of net sales value and volume for fabricated

LTFRB sets deadline for Uber, GrabCar to secure franchise

By Lorenz S. Marasigan

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RIVERS of both Uber and GrabCar will be apprehended starting next week should they fail to secure franchise and license requirements from the landtransport regulator.

Land Transportation Franchising and Regulatory Board (LTFRB) Chairman Winston M. Ginez has finally decided to impose a deadline on the transport network companies' (TNCs) application for provisional authority to operate.

“Uber and Grab Car operators will be apprehended starting on August 21, if they cannot secure the necessary franchise or provisional authority with the LTFRB,” he said in a text

message on Tuesday.

He warned that these companies and their fleet that fines will be based on the joint administrative order issued earlier this year. An apprehension may amount up to P200,000, plus a three-month vehicle impounding.

A lthough GrabCar has been accredited as a TNC, its partner drivers have yet to apply for their own licenses.

“A TNC applying for accreditation is different from securing franchise.

While GrabCar has already secured accreditation, the LTFRB has not yet receive application for franchise of individual GrabCar operators,” Ginez explained.

Officials of both companies were sought for comment, but only

Uber's spokesman replied to the BusinessMirror’s request.

“Uber is deeply committed to serving the local community and providing millions of Filipino commuters with access to safe, reliable and affordable transport options, creating thousands of jobs and bringing efficiency to Manila’s transportation system,” Uber Spokesman Karun Arya said in an e-mailed response.

He added t hat his g roup is working closely with the LTFR B and the Department of Transportation and Communications to finish the requirements.

“We are confident of completing the relevant formalities for accreditation in the time stipulated,” Arya said.

PCSO revenue in H1 at P16.2 billion

By Jovee Marie N. dela Cruz

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he Philippine Charity Sweepstakes Office (PCSO) on Tuesday announced that the agency’s revenue for the first half of 2015 has reached P16.2 billion.

PCSO General Manager Jose Ferdinand Rojas II, at the sidelines of the House Committee on Appropriations hearing on the proposed P3.002-trillion national budget, said that of the P16.2billion revenue, P14.5 billion came from Lotto, P1.6 billion from Keno and P25 million from Sweepstakes.

Rojas said the PCSO is targeting to generate a P35-billion revenue for 2015.

“Last year we recorded a total of P32 billion and this year we are optimistic that we will hit out target, as the PCSO is expected to launch more new games,” he said.

Currently, the PCSO has 47 branches nationwide.

Rojas said 55 percent of the PCSO’s income will go to the payment of lotto prizes; 30 percent to charity and social programs; and 15 percent for operating expenses and capital expenditure.

Rojas added that for every peso of income, 55 centavos goes to prizes, 15 centavos for agency operations, and 30 centavos goes to the Charity Fund.

According to Rojas, the PCSO assists at least 1,000 patients a day nationwide, processing their requests for financial assistance for hospitalization and treatment, such as hemodialysis and chemotherapy,

The Philippine Charity Sweepstakes Office, led by Vice Chairman and General Manager lawyer Jose Ferdinand M. Rojas II (from left) and Directors Betty Nantes (left) and lawyer Mabel Mamba turn over the symbolic key of a brand-new ambulance from the PCSO Ambulance Donation Program to Mayor Rojilyn Bagabaldo of Paete, Laguna, in a ceremony held at the municipal town plaza on Monday.

Eleven ambulances were released by the charity agency to different towns of Laguna. JOSEPH MUEGO

with a total worth of P16 million.

The charity agency also extends financial support to institutions, such as orphanages, and senior citizens’ homes, he said.

For 2015, Rojas said the PCSO will also allot a total of P19.8 million in financial grants to 20 facilities, which include orphanages, homes for the aged and home for street children, while it will earmark P110 million for 52 government hospital nationwide the same year.

He also said the PCSO has provided, from 2010 to June 2015, P973 million for its Ambulance and Mobile Clinic Donation Program, where fourth, fifth and sixth-class municipalities received

that ambulance at no cost.

Rojas added that the PCSO also provided, as mandated by law, from 2010 to June 2015 P22.9 billion to Philippine Crop Insurance Corp., Department of Foreign Affairs Information System on Migration, National Book Development Board, National Endowment Fund for Children’s Television, Dangerous Drugs Board, National Museum, Philippine Drug Enforcement Agency, National Sports Commission, Comprehensive and Integrated Shelter and Urban Development Financing Program, Commission on Higher Education, local governments shares from Lotto and Documentary Stamp Tax.

materials (21.4 percent and 17.4 percent), machinery (11.2 percent and 10.4 percent) and transport equipment (12.1 percent and 10.3 percent ) in net sales production canceled out the steep decline in basic metals.

Meanwhile, the average capacity utilization is sustained at 83.3 percent. PSA data showed that 50 percent, or 10 of the 20 major industries, operated at 80-percent-and-above capacity utilization rates.

These included basic metals, petroleum products, nonmetallic mineral products, machinery except electrical, electrical machinery and food manufactures.

The list also included chemical products, paper and paper products, rubber and plastic products, and swood and wood products.

“We must pursue consistent and responsive policy initiatives for MSMEs to increase their participation in the global value chains and manufacturing activities,” Balisacan said.

Balisacan added that the country should invest in cost-effective and climate-smart technology that will reduce the vulnerability of our locally produced products from the seasonal changes in weather conditions.

CBCP head: What inclusive growth?

By Claudeth Mocon-Ciriaco Correspondent

W

hile there are figures to prove that investments have risen and that economic fundamentals are strong, Lingayen-Dagupan Archbishop and Catholic Bishops’ Conference of the Philippines (CBCP) President Socrates Villegas on Tuesday expressed concern over the inclusiveness of economic gain.

“Government and corporate figures remain items of cold statistics, until they are translated into better lives by those now most disadvantaged,” Villegas said in a news statement.

He added that after President Aquino delivered his final State of the Nation Address recently, “the countdown has begun to the next national elections in 2016.”

“We thank God, whose mighty hand is at work in our history for the gains we have made. We implore His pardon for our faults and failings. We call on His unending mercy for the tremendous work

that must yet be done,” he said.

Villegas also take a swipe at Congress for not passing a law against political dynasties. “It is regrettable that Congress has, despite prompting by the Filipino people themselves, failed to pass a law that gives life to the constitutional rejection of political dynasties,” he said.

He added that until Congress defines what dynasties are in a manner that fulfills the policy embodied in the fundamental law, “we have nothing more but an inert provision of the Constitution that accusingly points at the refusal of Congress to act!”

Villegas also encourage debate among the candidates, and is hopeful that the dioceses will organize public fora and debates that allow the public to familiarize themselves with the positions, platforms, plans, beliefs and convictions of the candidates.

“All of these meetings, however, must be permeated by a genuine sense of fairness, consecration to the truth and, above all, charity,” he said.

A6 Wednesday, August 12, 2015

Opinion BusinessMirror

editorial

Politicking in face of serious developmental challenges

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ertain quarters say that politics is the Philippines’s main industry, and that the people’s principal occupation is politicking. Indeed, that seems to be a faithful description of the state of affairs in our country.

Consider the current political maneuverings, which, keen observers would agree, started as early as last year. Even then partisans have started their own countdown to the finish line for the BS Aquino administration. Soon enough, the political crowd began speculating on the possible candidates to be fielded by the administration and the opposition. Names mentioned include Vice President Jejomar C. Binay, Interior Secretary Manuel A. Roxas II, Sen. Grace Poe, Mayor Rodrigo R. Duterte, Sen. Ferdinand R. Marcos Jr. and former Sen. Panfilo M. Lacson.

Inevitably, vicious character assassination of probable opponents by the attack dogs of the principals ensued. For example, witch-hunters in the Senate carried out such mission in the guise of investigations in aid of legislation, etc.

At least two things are relevant at this point: the national election is not taking place until May 2016, a full 10 months away, and even the filing of certificates of candidacy (COCs) is not to be done until some two months from now. No one among the prospective candidates for the presidency has spoken a serious word about what he or she will do to the many difficult problems that the country faces in the various fields of human existence, at home and abroad.

Let us hold our fire until after the serious bets have filed their COCs. Then we will know who among them deserve our attention, our questions, and from whom shall we demand serious answers. For starters, we must insist that those presenting themselves for election to high offices have the qualifications for those offices. Politically motivated or not, citizenship questions must be settled.

The same earnestness of purpose must apply to other issues. Candidates must answer charges of corruption hurled against them, if any, and accusations of plunder leveled against their ancestors, if these are pertinent, must be cleared. On the biggest problem plaguing our government—the lack of integrity among the highest officials of our land, as shown by their continued plunder of the Treasury—candidates must be made to understand that we will not tolerate dishonesty in public office, that we will severely punish those who overstep the limits of propriety and integrity.

And then, finally, we must demand from those seeking public office coherent, sensible and implementable programs of government, if and when they get elected. Candidates must tell us what they will do to accelerate economic growth; how to create employment opportunities for our working people; mitigate poverty; reduce inequality; eliminate criminality; and deal with other social issues. They must show an ability to inspire and lead.

Candidates who can respond to these challenges are the kind of leaders who are worthy of our votes.

For so long we have elected candidates who had no clue on what to do once elevated to high offices. Let us not repeat past mistakes. Let us turn the coming election into a great opportunity to choose good leaders who will steer our country to rise to higher levels of economic, social, and political achievements.

How is the death benefit administered in the case of a Muslim member with multiple marriages?

Susie G. Bugante

All About Social Security

P

arsa H., a Muslim member, died in May 2012. His Form E-1 (Member Data Record) did not indicate any beneficiary. In June of the same year, his second wife Eliza filed for and was granted a funeral claim with the Social Security System (SSS). In August the first wife Margarita filed a death-benefit claim.

An investigation by the SSS revealed that Parsa was legally married to Margarita, a Christian, in 1983 before their town mayor, and their marriage was subsequently registered with the civil registry. In 2007, when the first marriage was still subsisting, Parsa contracted another marriage to another Christian woman, Eliza, under the Muslim law, and the marriage was similarly registered.

It was later discovered that Eliza

had a previous marriage to a certain Rodolfo Fermin way back in 2004.

The whereabouts and fact of death of Rodolfo Fermin could not be ascertained, however.

The issue now is: W ho between the two wives is the rightful claimant?

Article 13 No. (2) of Presidential Decree 1083 (“A Decree to Ordain and Promulgate a Code Recognizing the System of Filipino Muslim Laws,

Codifying Muslim Personal Laws, and Providing for it Administration and For Other Purposes”) provides that: In case of marriage between a Muslim and a non-Muslim, solemnized not in accordance with Muslim law or this Code, the Civil Code of the Philippines shall apply.

The earlier marriage of Eliza to Rodolfo is deemed still valid and in existence, making her subsequent marriage to Parsa illegal and void from the beginning. As a general rule, a marriage contracted with another person during the lifetime of the first spouse is null and void, unless the first marriage was annulled or dissolved, or the first spouse has been absent for seven consecutive years at the time of the second marriage without the present spouse being alive. Further, Article 41 of the Family Code requires a judicial declaration of presumptive death of the absentee spouse be obtained by the remaining spouse in order for him or her to be capacitated to remarry;

1990s come back to haunt Malaysia William Pesek

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BLOOMBERG VIEW

alaysia’s ongoing currency crash has many causes: a worsening global outlook, plunging commodity prices and, of course, the political scandal enveloping Prime Minister Najib Razak. But the real culprit is the year 1997.

The conventional wisdom is that Malaysia’s then-leader Mahathir Mohamad saved the country from the worst ravages of the Asian financial crisis when he imposed capital controls, pegged the ringgit and waged verbal war against speculators. It’s true that Malaysia avoided much of the chaos that toppled economies in Indonesia, South Korea and Thailand. But events today show why, 18 years later, Malaysia may wind up the biggest loser in the region.

Malaysia’s neighbors recovered by improving transparency, strengthening their financial systems, and limiting collusion between public and private sectors. Such urgency never swept Malaysia, where the ruling coalition has held power for almost six decades.

Improvements in Malaysian corporate governance have been slow and uneven. Hopes for an end to 46 years of affirmative action—which benefits the Malay majority while sapping productivity and repelling

foreign investors—have been for naught. Efforts to weed out corruption and ween the economy off energy exports have been tepid.

Today’s economic troubles are the product of that complacency. Had the Malaysian government worked harder to strengthen economic fundamentals and win the trust of global investors, Najib’s scandal might not be sending the ringgit to its lowest level in 17 years. Had officials in Putrajaya, the country’s administrative capital, done more to internationalize Malaysia’s business culture, foreign investors wouldn’t now be rushing for the door. The FTSE Bursa Malaysia KLCI Index has fallen more than 11 percent from its April 21 peak, while official foreign-exchange reserves dropped below $100 billion for the first time since 2010.

As has been well reported, Najib faces questions about $700 million that allegedly moved through government agencies and state-linked companies to accounts bearing his

name. (Najib denies it, while Malaysia’s antigraft commission says it was a “donation”.) But foreign investors’ mistrust of the Malaysian government traces back to policies pursued over the past 18 years.

Perhaps, the most notorious was Mahathir’s September 1998 decision to sack Deputy Prime Minister and Finance Minister Anwar Ibrahim. After months of sparring with Anwar over postcrisis reforms, Mahathir fired him and named himself finance minister, an awkward centralization of power that persists today and enabled Najib to create and oversee scandal-plagued state investment company 1Malaysia Development Bhd. And when Najib recently fired Deputy Prime Minister Muhyiddin Yassin, who was demanding answers from the prime minister, it seemed like history repeating itself. Just as in 1997 and 1998, the government is more concerned with closing ranks than retooling the economy.

Indonesia, South Korea and Thailand are also having their share of troubles, as China wobbles and the Federal Reserve prepares to hike interest rates. But Malaysia’s accelerating capital flight is particularly worrisome.

Malaysia’s central bank appears to be struggling to slow the ringgit’s 18-percent plunge over the past 12 months. The currency is now the lowest since Anwar’s departure in September 1998. That makes for an inauspicious economic bookend: Mahathir is now among those suggesting

otherwise the remaining spouse could be charged with bigamy, adultery or concubinage.

Eliza and Parsa’s marriage was deemed null and void, thereby disqualifying Eliza from being a primary beneficiary of Parsa.

Suppose Parsa’s marriages were valid and legal, how will the death benefit be administered? The death benefit, whether in lump sum or pension form, will be shared equally between the two spouses, since, as a Muslim, Parsa was allowed to have up to four wives, subject to Muslim laws, customs and traditions.

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.

Malaysia peg the ringgit anew.

There’s certainly less stigma attached to such policies than there once was. In 1998 the International Monetary Fund (IMF) called Malaysia’s peg a “retrograde step.” By December 2002, the IMF was terming it a “stability anchor.” And the IMF notably didn’t slap Greece for imposing capital controls, the way it did Mahathir in the late 1990s.

But the mere mention of another peg suggests Malaysia’s political establishment is still more concerned with the symptoms of the country’s problems than the underlying causes. The ringgit isn’t sliding, because speculators like George Soros (who Mahathir blamed in 1997) are attacking it. Malaysian assets are suffering because the government failed to do basic economic maintenance—in part, because it avoided the worst of 1997 and 1998, in ways Bangkok, Jakarta and Seoul couldn’t.

As that dawns on investors, the pressure to sell will intensify. Overseas ownership of Malaysian government and corporate debt fell 2.4 percent in July as a sense of crisis began to permeate the air.

Malaysia isn’t about to collapse.

With its moderate growth and the highly respected Zeti Akhtar Aziz helming the central bank, meltdown risks are limited. But Malaysian officials are wrong to argue that the ringgit’s slide doesn’t reflect underlying fundamentals. It does, indeed, and that’s the real problem—one that can be traced back to 1997.

Opinion BusinessMirror

opinion@businessmirror.com.ph

What US citizens weren’t told about the atomic bombs

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By Susan Southard | TNS

eventy years ago, the United States dropped two atomic bombs on Japan: Hiroshima on August 6, 1945; Nagasaki on August 9. With searing heat and annihilating force, the nuclear blasts tore through factories, shops and homes in both cities. Huge portions of Hiroshima and Nagasaki vanished. Weighing many factors, including the Soviet Union’s entry into the war against Japan 11 hours before the Nagasaki bombing, Japan surrendered.

By August 15, World War II was over.

In the US the necessity of the bombings to end the war has been studied and argued for decades, but the acute and long-term effects of whole-body radiation exposure on the men, women and children beneath the mushroom clouds are little known and seldom mentioned. Without also accounting for this critical aspect of the bombings, discussions of the military, moral and existential issues surrounding Hiroshima and Nagasaki are incomplete. If we choose to take and defend actions that cause great harm to civilians during war, we must also scrutinize and wholly understand the effect of those actions.

Within a week of each nuclear attack, thousands who had escaped death began to experience inexplicable combinations of symptoms: high fever, dizziness, nausea, headaches, diarrhea, bloody stools, nosebleeds and whole-body weakness. Their hair fell out in large clumps, their wounds secreted extreme amounts of pus, and their gums swelled and bled. Purple spots appeared on their bodies, signs of hemorrhaging beneath the skin.

Infections ravaged their internal organs. Within a few days of the onset of symptoms, many people lost consciousness, mumbled deliriously and died in extreme pain; others languished for weeks before either dying or slowly recovering.

Even those who had suffered no external injuries fell sick and died.

In the ruins of his small tuberculosis hospital in Nagasaki, Dr. Tatsuichiro Akizuki likened the situation to the Black Death pandemic that ravaged Europe in the 1300s.

A second wave of radiation illnesses and deaths swept through Nagasaki in late August through early October. From Akizuki’s perspective on top of Motohara Hill, the illness carved a clear geographical path: From the bottom of the hill upward, people died in order of their distance from the bomb’s hypocenter. Akizuki called this phenomenon the “concentric circles of death.”

Today Americans’ silence on this crucial chapter of the atomic bomb story is, in large part, an extension of US denial and suppression since the end of the war. Immediately after the bombings, high-level US officials publicly—and adamantly—rebuffed news reports about the bombs’ horrific aftereffects. Gen. Leslie Groves, director of the Manhattan Project, which developed the atomic bombs, dismissed these reports as propaganda, even as he sent teams to measure radiation levels to ensure the safety of US troops about to enter both cities.

Later that year Groves testified before the US Senate that death from highdose radiation exposure is “without

undue suffering” and “a very pleasant way to die.”

In Nagasaki newborn death rates skyrocketed in the nine months after the bombing: 43 percent of pregnancies in which the fetus was exposed within a quarter-mile of the hypocenter ended in spontaneous abortion, stillbirth or infant death. Young mothers giving birth in the ruins did not know it yet, but even those infants who survived would face severe physical and mental disabilities.

For years, tens of thousands of hibakusha (“atomic bomb-affected people”) suffered agonizing radiation-related illnesses. Many died. Meanwhile, Gen. Douglas MacArthur’s occupation press code censored Japanese news accounts, personal testimonies, photographs and scientific research on the survivors’ conditions. In the US, virtually all reports about the devastation and radiation-related deaths stopped after a confidential memo to American media requested that all reports about the atomic bombs be preapproved by the War Department, particularly those containing scientific or technical details.

In 1946 and 1947, opposition to the bombings began appearing in US media, including John Hersey’s Hiroshima, first published in The New Yorker, and a scathing essay by journalist Norman Cousins in the Saturday Review.

US government and military officials hurriedly strategized how to prevent what they considered “a distortion of history” that could damage postwar international relations and threaten US nuclear development.

Two articles by prominent government officials—the first by Karl T. Compton, a respected physicist who had helped develop the atomic bombs, and the second by former Secretary of War Henry L. Stimson—offered intelligent and persuasive “behind the scenes” perspectives on the US decision to use the bombs. These powerful justifications effectively quelled civic dissent and directed focus away from the ongoing suffering of the people of Nagasaki and Hiroshima.

By the early 1950s cancer rates for hibakusha adults and children soared, and many more hibakusha developed liver, endocrine, blood and skin diseases, and impairments of the central nervous system. Mortality rates remained high. Most commonly, survivors experienced violent dizzy spells and a profound depletion of energy.

Fears about genetic effects of radiation exposure on their children haunted them for decades. Thirty years after the war, high rates of leukemia, as well as stomach and colon cancer, persisted.

From the survivors’ perspective, the atomic bomb had burned their bodies from the inside out.

T

permanent homes built through the Red Cross in Haiti is six, according to the ProPublica/NPR investigation.

Overall, reporters found “a string of poorly managed projects, questionable spending and dubious claims of success.”

The reporting has prompted an inquiry by US Sen. Charles Grassley, Republic-Iowa. In a letter to Red Cross officials, Grassley said he had been “assured that the Red Cross had made substantial steps forward in improving efficiencies and reducing waste, fraud and abuse within the organization. However, the recent news articles cast doubt on some representations made by the Red Cross.”

The Red Cross’s initial plan, according to the ProPublica/NPR reports, was to build roughly 700 homes with toilets and showers—

A7

White House should leave politics out of Iran deal

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By Michael R. Bloomberg | Bloomberg View

f you oppose the Iranian nuclear agreement, you are increasing the chances of war. And if you are a Democrat who opposes the agreement, you are also risking your political career.

That’s the message the White House and some liberal leaders are sending—and they ought to stop now, because they are only hurting their credibility.

I have deep reservations about the Iranian nuclear agreement, but I—like many Americans—am still weighing the evidence for and against it. This is one of the most important debates of our time, one with huge implications for our future and security and the stability of the world.

Yet, instead of attempting to persuade Americans on the merits, supporters of the deal are resorting to intimidation and demonization, while also grossly overstating their case.

Last week President Barack Obama said that it was not a difficult decision to endorse the agreement. I couldn’t disagree more. This is an extraordinarily difficult decision, and the president’s case would be more compelling if he stopped minimizing the agreement’s weaknesses and exaggerating its benefits. If he believes that the deal “permanently prohibits Iran from obtaining a nuclear weapon,” as he said in his speech at American University last Wednesday, then he should take another look at the agreement, whose restrictions end suddenly after 15 years, with some of the constraints on uranium enrichment melting away after just 10.

Overstating the case for the agreement belies the gravity of the issue

and does more to breed distrust than win support. Smearing critics is even less effective. In his speech, the president suggested that critics of the deal are the same people who argued for the war in Iraq. The message wasn’t very subtle: Those who oppose the agreement are warmongers. (Of course, those who voted for the Iraq War resolution in 2002 include Obama’s vice president and secretary of state.)

Then he went further, saying: “It’s those hardliners chanting ‘Death to America’ who have been most opposed to the deal. They’re making common cause with the Republican caucus.” From a president who often complains about hyper partisanship, and whose stated aim is to elevate the discourse, the public deserved something better.

Emblematic of all this—and what has prompted me to write—was the treatment of Sen. Chuck Schumer. In his thoughtful statement opposing the deal, Schumer noted that the best course of action is not clear. Reasonable people can and do disagree.

Yet, rather than acknowledging a respectful difference of opinion, the president’s spokesman and others close to the White House suggest-

Red Cross, where did the money for Haiti go?

he world reached out in grand fashion when a massive earthquake struck Haiti five years ago. Former President Bill Clinton raised millions of dollars. Celebrities organized high-profile benefits.

The American Red Cross joined in the effort in a big way, promising to rebuild homes, schools and infrastructure in a country that was in desperate shape before the earthquake.

The Red Cross raised almost $500 million, more than any other group.

Where did the money go? That has come under question in an investigation by ProPublica, a nonprofit news organization, and National Public Radio (NPR). The chief executive of the Red Cross said in 2011 that the agency would “provide tens of thousands of people with permanent homes.” The actual number of

Wednesday, August 12, 2015

luxuries in Haiti. They would start in Campeche, a hillside neighborhood in Port-au-Prince where residents lived in mud and sheet metal shacks.

No homes were built there.

According to the reports, the Red Cross was unable to deliver on many of its projects in Haiti. Red Cross leaders were reluctant to rely on the Haitian people or native speakers for help navigating the cultures and politics of a complex, poverty-stricken nation. So the Red Cross gave millions to outside groups, didn’t properly track the money, and spent too much on overhead and bureaucracy.

The Red Cross continued to raise money for Haiti “well after it had enough for the emergency relief that is the group’s stock and trade,” ProPublica/NPR reported.

The Red Cross has challenged

the reporting. In a letter to Grassley, Red Cross officials said they spent $400.5 million of the $487.6 million raised. They used the money to repair homes, provide rental subsidies and shelters. They also trained Haitians on first aid and jobs skills, and provided soap, buckets and rehydration packets during a cholera outbreak. The money bought mosquito nets. It helped toward rubble removal efforts. And it helped repair infrastructure.

“For a disaster of the scale of the Haiti earthquake, the needs were so great that we could not in good conscience halt donations or imagine at the outset what precise amount of donations would be needed,” the agency wrote to Grassley. “We are confident that those donations were needed and we spent and committed

OBAMA

ed that Schumer’s decision may cost him the opportunity to become the leader of the Senate’s Democratic caucus. What they should have said is: President Obama signed legislation that gives Congress a voice on any deal with Iran. This debate is far bigger than partisan politics, and personal political considerations should play no role in deciding it.

Schumer is right that this is a vote of conscience. Each member of Congress, after closely studying the deal and listening to all arguments on both sides, ought to decide the matter on the merits—and the White House should be focused on making the case on the merits, instead of using campaign-style tactics to pressure Democrats into standing together.

The White House’s behavior is especially disappointing given the way the negotiations unfolded. Every negotiation comes with give-and-take.

This one was no exception. Significant concessions were made at the last moment, including on ballistic

missiles and arms. These were surprising changes and they come with large implications that require careful scrutiny.

In his speech last week, the president said that Congress must decide “whether to support this historic diplomatic breakthrough” or to block it “over the objection of the vast majority of the world.”

Congress should not act based on the opinion of the rest of the world, nor the opinion of the American public, which opposes the agreement by a 2-to-1 margin, according to a recent poll. Congress should make its own hard and careful assessment of the agreement—something it cannot possibly do without seeing the yet-to-be-revealed side deals.

How can you vote on a pact that you haven’t been able to read in full?

Once it has reviewed the full deal, Congress should consider what it means for the future, and then it should lead, drawing on the facts and leaving the politics aside. The White House should do the same.

them well.” But Grassley’s frustration has only grown. The senator has criticized the Red Cross for not being more transparent about how it spent the money it raised for Haiti.

“It’s unclear why the Red Cross enters into contracts with other organizations stipulating that details of grants can’t be disclosed to the media or donors,” Grassley said in a statement reported by NPR. “Who’s driving the lack of disclosure, the Red Cross or the grant recipients?

What’s the rationale for it?”

The Red Cross has faced accusations in the past that it is heavily bureaucratic and intently focused on its public image. ProPublica/NPR reporting raised questions about its response to Superstorm Sandy and Hurricane Isaac in 2012.

After the September 11 attacks,

then-New York Attorney General Eliot Spitzer said the Red Cross “raised hundreds of millions of dollars that was intended by the donating public to be used for the victims of September 11. I see those funds being sequestered into long-term plans for an organization.”

Red Cross frontline workers over the years, decades, have done tremendous work, often under extremely difficult conditions. Few situations have been more challenging than Haiti, where the earthquake took tens of thousands of lives and displaced some 1 million people.

But it’s essential that not-forprofit fundraising organizations be utterly transparent to donors, to recipients, to the broad public. They deal with disaster. But first they have to earn trust. TNS