BusinessMirror November 12, 2015 by BusinessMirror

media partner of the year

United nations

2015 environmental Media Award leadership award 2008

BusinessMirror A broader look at today’s business

www.businessmirror.com.ph

Thursday 18, 2014 Vol.12, 10 No. 40 Thursday, November 2015 Vol. 11 No. 35

P25.00 nationwide | 5 sections 30 pages | 7 days a week

House works overtime to OK salary hike for state workers By Jovee Marie N. dela Cruz & David Cagahastian

INSIDE

embers of the House of Representatives—without questioning the evident lack of quorum—on Wednesday opened for second-reading deliberations the proposed Salary Standardization Law (SSL) of 2015, with the intention of passing the Malacañang-certified measure—from the committee level to third reading—in just one day.

greece: hospitable & affordable

life

elLie goulDing

The bill was passed on second reading at about 7:40 p.m. The lawmakers, however, decided not to proceed to the third and final reading because the certification from Malacañang that it should be passed in a day of deliberations did not arrive. The 1987 Constitution allows

Congress to dispense with the constitutional requirement of three readings on separate days for any bill to be passed. But with the Palace’s urgent certification, Congress can approve a bill on second and third reading during the same day. Continued on A2

Economy to see smooth sailing for rest of 2015

show

health&Fitness

By Bianca Cuaresma

he country’s growth is set for a smooth sailing until the end of the year, as no sudden upticks in inflation or economic shocks are expected in the last run of the economy for the remainder of 2015. With this, regulators continue to adopt a wait-and-see stance taking into consideration global developments, an international economist said. In particular, the country’s GDP growth is still likely to hit circa 5 percent in the last two quarters of the year; inflation will still remain muted; the local currency is set to

end the year broadly at a level where it is now; and the central bank is likely to hold all policy rates at current levels for the year, Hongkong and Shanghai Banking Corp. (HSBC) economist Joseph Incalcaterra told reporters on Wednesday.

GDP

Incalcaterra said that, while its forecast for the country is at circa 5percent growth at the end of the year, it is still a “good outcome” relative to the slowing growth of the global economy, particularly in the region. In his latest research note on the

media partner

he Organization of the Petroleum Exporting Countries (Opec) is considering raising its official production target at its next meeting on December 4 to take into account new member Indonesia, according to two Opec delegates. The production ceiling may be raised by 1 million barrels a day to 31 million barrels, the delegates said, asking not to be identified because the discussions are private. A change doesn’t imply higher production, because the Opec, itself, said it pumped 31.57 million barrels a day in September. T he Southeast Asian nation’s reentry after a break of almost seven years comes at a time when the Opec has abandoned its traditional role in supporting prices, as it seeks to defend market share against supplies from US shale drillers and other rivals. The Opec will now have 13 members, led by Saudi Arabia, the world’s largest crude exporter. Indonesia suspended its membership in 2009, after becoming a net oil importer. It pumped 852,000 barrels a day in 2014 and consumed almost twice as much, according to BP Plc. Indonesian Energy Minister Sudirman Said confirmed in an interview in Doha on Monday that the Opec has accepted his country’s return to the group. Opec Secretary-General Abdalla El-Badri said in Doha on

Monday the decision will be formally announced at the December 4 meeting. Indonesia will become a net importer of crude by 2020 as the country plans to add new refinery capacity, according to a BMI Research report in October. The country’s energy minister went to Riyadh on Monday, as Saudi Arabia and Indonesia neared an agreement to build their first jointly owned refinery in the Pacific country. The refinery is tentatively planned to have capacity of 300,000 barrels a day, with the contract signing expected by the end of this year, Said said on Monday. Bloomberg News

Australian firms want Canberra to forge bilateral trade deal with Manila By Catherine N. Pillas

BusinessMirror

See “Economy,” A2

OPEC TO CONSIDER NEW OUTPUT CEILING AS INDONESIA REJOINS T

he Philippines and Australia should consider forging a bilateral free-trade agreement (FTA) to enable them to maximize the benefits of the forthcoming Asean economic integration, businessmen belonging to the Australian-New Zealand Chamber of Commerce (Anzcham) said. Tom Grealy, president of Anzcham, said Australian companies can use the Philippines as their staging point or regional hub for

PESO exchange rates n US 47.2100

their Southeast Asian expansion in growth sectors, as well as in harnessing Asean value chains. “By gaining greater access to the Philippine market as a regional base, Australian firms can access regional value chains while creating jobs in the Philippines,” Grealy said. The need to forge a Manila-Canberra FTA was validated by a study conducted by the Anzcham, titled “Winning the Asean Market: Impact of the Asean Economic Community (AEC) on Australian and Philippine Business Relations.”

The report concluded that a bilateral economic-partnership agreement between the two countries would further the growth of twoway trade and investment between Australia and the Philippines. It said the AEC, set to begin in January, highlighted the advantages of creating a deeper and broader economic partnership between the two countries. The study specified that there are ripe opportunities in goods, such as agricultural, processed food, spirits and beverage

products; pharmaceuticals, generics and supplements, manufacturing and electrical components and machinery; metals, copper, precious stones and coins, minerals, oils, animal and vegetables fats, fuels and distillation products; and optical, photo, technical and medical apparatus. It also identified opportunities in the services sector, such as transnational education, travel, transport and logistics; engineering and architectural design services; financial See “Australian,” A2

n japan 0.3833 n UK 71.3862 n HK 6.0909 n CHINA 7.4208 n singapore 33.1951 n australia 33.1974 n EU 50.6233 n SAUDI arabia 12.5890

Source: BSP (11 November 2015)

Thursday, November 12, 2015

News

BusinessMirror

news@businessmirror.com.ph

House works overtime to OK salary hike for state workers. . . The measure will modify the compensation and position-classification system of civilian government personnel and the base-pay schedule of military and uniformed personnel. Majority Leader and Liberal Party Rep. Neptali M. Gonzales II and Chairman of the House Committee on Appropriations Rep. Isidro T. Ungab of Davao City said the lower chamber intended to approve House Bill 6268 at least on second reading on Wednesday. As of press time, the bill, principally authored by Speaker Feliciano R. Belmonte Jr. and Gonzales of Mandaluyong, was under the period of interpellation. Ungab said they have been waiting for the SSL since last week, as the Department of Budget and Management (DBM) had promised during the budget hearings to provide the salaryadjustment details. On Wednesday morning Ungab’s committee approved the SSL in just one hearing. “I believe this is good news to all employees of the government, from the highest official to those lowest ranked. I think there will only be one hearing on it because I’m sure everyone supports the proposal. I don’t see any objection to it,” he said. According to Ungab, the first round of the salary-standardization scheme will be implemented next year and will require a total funding of P57.9 billion.

Funding requirements

Of this amount, the lawmaker said P50.4 billion has already been earmarked in the 2016 General Appropriations Act (GAA), which the House approved on third and final reading in October before adjournment. The balance of P7.5 billion will come from adjustments they will make in the bicameral conference committee, or from the Pension and Gratuity Fund. “Most likely, the GAA and the SSL will be passed altogether after the bicameral committee approval, or when both houses have ratified the budget [measure],” Ungab said. Ungab added that the funding requirements for the succeeding compensation adjustments shall have the following budgetary requirements: sec-

ond tranche, P54.3 billion; third tranche, P65.9 billion; and fourth tranche, P47.5 billion. The bill provides that the Compensation and Position Classification System shall apply to all civilian government personnel in the Executive, Legislative and Judicial branches, constitutional commissions and other constitutional offices, government-owned or -controlled corporations not covered by Republic Act (RA) 10149, and local government units. It shall cover government personnel, whether regular, contractual or casual, appointive or elective; and on full-time or part-time basis. Under the new SSL, those under Salary Grade (SG) 1 who are now receiving P9,000 per month, will get P9,478 per month under Step 1 of the first tranche, P9,981 under the second tranche, P10,510 under the third tranche, and P11,068 under the final tranche. Those in the highest level of SG 33, who are presently receiving P120,000/ month will get P160,000/month, in the first tranche, P215,804 in the second tranche, P289,4010 in the third tranche and P388,096 in the final tranche. The bill said it is the declared policy of the state to provide all government personnel a just and equitable compensation in accordance with the principle of equal pay for work of equal value. Belmonte said the measure aims primarily to raise the pay of the government personnel to be competitive with the market, and thereby attract and retain capable and committed personnel. “It also aims to strengthen the link between pay and performance through an enhanced performance-based bonus system, temper the cost of benefit while maximizing the benefits of employees, and allow higher take-home pay, especially for government personnel belonging to the lower salary grades,” the Speaker said.

Word war

Budget Secretary Florencio B. Abad on Tuesday figured in a debate with Party-list Rep. Antonio Tinio of Alliance of Concerned Teachers, after the lawmaker opposed the 2015 SSL. According to Tinio, the proposed salary hike would only result in a P551 increase per year in the salaries of

teachers under SG 11. Tinio added the increase of teachers’, as well as nurses’, salary to P20,754 from the current pay of P18,549 amounted to a raise of only 11.9 percent, and not 45 percent, as claimed by the government. On the other hand, Abad said Tinio’s claim was “biased,” saying: “I don’t think the presentation is complete. The 11.89 percent is only the salary increase… huwag natin sabihing 11.89 percent because you’re also going to get mid-year [bonus] and performance-based bonus [PBB]. Let’s be factual about it.”

Take-home pay

Meanwhile, during the hearing of the House Committee on Appropriations, Abad said for every 10 government employees, five will get a higher take-home pay under the proposed SSL 2015 due to the new tax-free bonuses. “Under the SSL 2015, five in every 10 civilian personnel will receive their full midyear bonus and their full PBB because these additional benefits will be tax-free. And eight in every 10 civilian personnel will receive their full midyear bonus tax-free. This is because under RA 10653, gross benefits, such as the 13th-month pay and other benefits not exceeding P82,000, shall be tax-exempt. This means the majority of employees will enjoy a higher take-home pay as a result of adjustments under SSL 2015,” Abad said. According to Abad, the majority pertains to 52 percent of all authorized civilian positions, or 606,454 employees in SG 1-11. “These employees will receive not only their existing tax-exempt 13thmonth pay, personnel economic relief allowance, cash gift and performanceenhanced incentive, they will also get their full mid-year bonus and PBB taxfree,” he said. Moreover, he said employees with SG 12 to 16 numbering 364,489, or 31 percent of all authorized civilian positions, who receive their existing tax-exempt 13th-month pay, cash gift and other perks, will get their full midyear bonus tax-free. Abad said the proposed SSL 2015, which the DBM submitted to Congress on Monday, will raise the compensation of the 1.53 million govern-

ment personnel by up to 45 percent.

Inflation-neutral

“It will be implemented in four tranches over four years starting January 2016. Upon full implementation, SSL 2015 will bring the compensation of all government workers to at least 70 percent of market rate,” he said. “SSL 2015 is almost inflation-neutral. We also estimate that the impact of GDP growth is positive, adding 0.022 percent to growth in 2016, 0.05 percent in 2017 and 0.09 percent in 2018,” Abad said. The budget chief also pointed out that, though the proposed SSL 2015 will be effective on January 1, 2016, current high officials will not enjoy its benefits as the compensation adjustment for the salaries of the President, the Vice President, and the members of Congress and the Cabinet will take effect only on July 1, 2016. According to Section 10 of Article VI of the 1987 Philippine Constitution, “No increase in said compensation shall take effect until after the expiration of the full term of all the members of the Senate and the House of Representatives approving such increase.” On the other hand, Section 6 of Article VII states: “No increase in said compensation shall take effect until after the expiration of the term of the incumbent during which such increase was approved.”

Boost to consumption

Finance Undersecretary Gil S. Beltran said the increase in the purchasing power of the huge number of government employees will result in higher consumption levels that can stimulate an economy that is mostly driven by consumption. The government is the single-biggest employer in the country, with total state employees ballooning from only about 1 million in 2008 to the current 1.53 million workers who stand to benefit from a bill endorsed by President Aquino to Congress and is expected to take effect by January 2016. This does not include the 191,988 unfilled positions in the government, many of which require highly technical skills that are valued at a premium by the private sector, both here and abroad.

Continued from A1

According to Abad, the salaries of government workers will be gradually increased during the next four years, resulting in an overall hike of 45 percent from this year’s level by the end of the fourth year.

No fiscal problem

The government is targeting to keep the middle-level government workers in its employ by increasing their salaries to put them on a par with the salary levels in the private sector, although even those employees with lower salary grades will benefit from the bill. Beltran, the Department of Finance chief economist, said the P226-billion proposed salary increase, which will be released in four tranches, is not expected to strain the government’s budget, nor the revenue-collection efforts. “Since the deficit of the national government is very low at 0.2 percent of GDP as of September--and automatic withholdingsystemwillevenboostrevenuecollection—thereisnoexpectedfiscalproblem arising from this measure,” he said. The government’s fiscal deficit target for the year remains at 2 percent of GDP, which translates to around P210 billion.

Drilon files counterpart bill

Senate President Franklin Drilon, meanwhile, filed Senate Bill 3009, which mandates a weighted average increase of 45 percent in the total compensation of all government personnel over a fouryear period. “The economy is in the right course and we will take advantage of the favorable condition to raise the pay scheme in the government and align it with the compensation received by employees from the private sector,” Drilon said. “It is about time that we adjust the salaries of the hardworking men and women who have helped the government to fulfill its mandates to the people,” he added. The bill is co-authored by Finance Committee Chairman Loren Legarda. Drilon said the Senate targets to pass the measure before the year is over. He is confident that with the support of both houses of Congress, employees, except for incumbent elected national officials, will be able to enjoy the new salary package starting on January 1. With PNA

Economy. . . Continued from A1

Philippines, Incalcaterra said the country is likely to grow by 5.7 percent for the entire year. This is below the government’s target of 7 percent to 8 percent for the year. Several economists and research institutions have earlier scaled down their forecast for the country following the slower-than-expected growth in the first half of the year. T he Ph i l ippi ne St at i st ic s Authority will be announcing the third-quarter GDP expansion of the country at the end of the month. Currently, the country’s GDP growth sits at 5.3 percent in the first half of the year, down from the 6.2 percent in the first semester of last year.

Inflation

Incalcaterra also said inflation in the country may have bottomed out for the year, after seeing several months of below 1-percent average rise in prices in the previous months. But the economist said the Philippines may see another month of low inflation before seeing significant pick-up due to upside risks entering 2016, particularly El Niño’s effect on the country’s agricultural production. He expressed confidence, meanwhile, that inflation will get back to the 2-percent to 4-percent target range next year, as it is set to miss the same target band this year. At present, the inflation average for the first 10 months of the year is at 1.45 percent. This means that for inflation to hit the bottom-end of the target, it must push to 4.75 percent in the last two months of the year.

Peso

Meanwhile, for the local currency, the economist said the peso will no longer fall further, as any bout of volatility toward the year end will be moderated by the strong dollar inflows from remittances in the country. On Wednesday, the peso hit 46.95 to a dollar, appreciating strongly from the previous day’s 47.26 to a dollar. The total traded volume during the day was at $753.7 million. Incalcaterra said the peso would likely end the year at 47.10 to a dollar.

Monetary policy

In terms of monetary policy, the economist reiterated its forecast that the BSP will retain its current stance up the end of the year. Incalcaterra also lauded the BSP’s ability to provide forward guidance to the market. The BSP will be having its seventh and second-to-thelast monetary-policy setting meeting for the year on Thursday.

Australian. . . Continued from A1

services, including insurance, accounting and actuarial services; information-technology consulting and management services; health and medical services; advertising and marketing, business-process management, creative services, and infrastructure. The three recommendations highlighted by the Anzcham president are support to Australian firms through access to Asean value chains; a bilateral economic partnership to cement market access; and to push the removal of barriers that hinder entry and growth of foreign businesses and investments. With over 300 members, Anzcham is the premier business organization supporting the development and growth of Australian and New Zealand businesses in the Philippines. The AEC study was undertaken with funding support from the Australian Trade Commission’s Asian Business Engagement Plan. The study assessed the potential impacts of AEC on AustraliaPhilippines trade and investment relations, focusing on opportunities for Australian business under an AEC regime, and provides guidance to Australian industries by identifying possible business opportunities arising from the Asean integration.

TheBroa

Business

A4 Thursday, November 12, 2015

Govt sets strict security m By Rene Acosta & Claudeth Mocon-Ciriaco

HEN the 21 leaders of the Asia-Pacific Economic Cooperation (Apec) group gather in Manila next week, the government’s security measures will be tested.

Indeed, in a country that is plagued by terrorism, other highprofile crimes and even too much activism, security is foremost during the gathering. In fact, one can even declare that the success of the meeting rests upon the effectiveness of the security blanket thrown around the dignitaries. The importance of security cannot be overemphasized, with no less than the National Police chief, Director General Ricardo Marquez, acting as the national task force commander on security, to ensure that he is on top of every detail despite overseeing the country’s overall peace and order situation. For the National Police spokesman, Chief Supt. Wilben Mayor, next week’s activities would be the culmination of 12 months of strategizing, readjustments and even continued practice in the security measures to be implemented using at least 30,000 people, including policemen and soldiers, from at least 20 agencies. “Director General Marquez wants zero incident,” Mayor declared. He said the successive meetings of the Apec threw the government into its biggest security work in 20 years when it hosted similar meetings in 1996, the year that the Apec summit was held in the Philippines. The final gathering, which is the Economic Leaders’ Meeting, will be held on November 18 and 19, while the penultimate activity, which is the Ministerial Meeting that will be held for two days ahead of the last meeting, will close the country’s yearlong hosting of the Apec meetings. Twenty-one heads of economies, including US President Barack Obama and Russian President Vladimir Putin, are expected to attend the Economic Leaders’ Meeting.

Task groups

MAYOR said that, in order to grapple with the huge task of ensuring the security of the delegates, the government has organized several task groups that will cover every aspect of security—emergency preparedness, peace and order, security, diplomatic, delegates, hotel billet—and measures in case of calamities and disasters, among others. “It even included fire,” he said. Mayor said that when Pope Francis visited the country, they secured only one dignitary, but in the Apec summit, they have to secure 21 heads of economies and an additional 200 dignitaries. In all of the hotels where the delegates would be billeted, the government has drawn a security package where security teams were organized to man traffic, do hotel security, provide dignitary security, perform quick response, crowd control, emergency response, search and rescue, parking and even tactical operations. “Everything is covered,” Mayor said. “We do dry runs, tabletop exercise and simulations. We have critiques in every event, so that we can adjust or improve if it is needed. The National Police chief himself supervises all of these things,” he added.

Traffic, enclosures

IN order to ensure foolproof secu-

BusinessMirror media partner rity for the delegates and even for the twin meetings, the government has decided to close both northbound and southbound lanes of Roxas Boulevard to traffic from November 16 to 20. Also, all roads around the Mall of Asia will be closed to traffic during the same period. The government said in “areas where roads are not closed, traffic will be stopped whenever delegates will pass and resumed once the delegates have gone through.” Likewise, only Apec vehicles are allowed to use the innermost lanes of Epifanio de los Santos Avenue during the five-day period. “Truck ban will be implemented along Roxas Boulevard during the said period,” the government also said. A no-fly zone will also be observed in all terminals of the Ninoy Aquino International Airport on November 17, 19 and 20. On the other hand, waters near the Apec venues, such as the Cultural Center of the Philippines and the Philippine International Convention Center, will be “off-limits” to vessels, affecting Manila Bay. Mayor said that even cellular telephone signals may be occasionally interrupted. “We are advising that in case [it happens], we should be ready,” he said. “In this particular event, please expect inconvenience,” he added, noting it irregularly happens, and it is even for the good of the country.

A policeman passes by a huge hashtag sign installed at the Quirino Grandstand on Roxas Boulevard in Manila. Thousands of policemen are set to be deployed to keep peace and order for the upcoming Apec summit. ALYSA SALEN

Rallies and protests

ALTHOUGH the Department of the Interior and Local Government has already issued reminders about the law on the “no permit, no rally,” the police are still expecting that some groups will stage rallies in exercise of the freedom of expression. But Mayor said mass actions should be conducted within the bounds of law. “We recognize freedom of expression, provided it should not prejudice the rights of others,” he said. “We appeal to the public, to the rallyists, to cooperate with the government because this only happens in 20 years,” Mayor added. Still, the police would exercise maximum tolerance in dealing with groups. “There should be no violence,” Mayor said. “With the cooperation of the public, the burden of the government will be lessened,” he added.

MMDA preparations

CHAIRMAN Emerson Carlos of the Metropolitan Manila Development Authority (MMDA) said that, since last week, the agency has been conducting simulations on traffic scenarios and condi-

A police officer gives orders to his men as they practice security deployment on Sunday for the upcoming Apec summit in Manila. AP/Aaron Favila

tions of routes to be used by the heads of state attending the Apec. Carlos said all is set for the traffic, communications and emergency preparedness for the Apec leaders’ meeting, and that around 2,500 MMDA personnel will be assigned mainly along Edsa and Roxas Boulevard, as well as around the airport terminals. As part of security and traffic preparations, the construction of major infrastructure projects will be stopped two days before the

summit. These are Ninoy Aquino International Airport Expressway project, Skyway extension and Ayala Bridge. To make sure that Apec delegates will not get stuck in Metro Manila’s traffic, he said, some roads will be partly or fully closed for non-Apec vehicles. He added that a stop-andgo scheme will be implemented along portions of Edsa, Roxas Boulevard, Skyway and South Luzon Expressway.

Under this scheme, all traffic will be stopped whenever Apec vehicles are passing through. Carlos said the agency’s personnel have already placed thousands of plastic barriers and cones along the stretch of Edsa and Roxas Boulevard in preparation for the event. “Now, with the help of the Apec National Organizing Committee and Committee on Peace and Order and Emergency Preparedness, of which the MMDA

and the Highway Patrol Group are members, we are ready for the Apec [summit],” Carlos declared. Carlos said he is constantly communicating with Cabinet Secretary Jose Rene Almendras and the HPG commander, Chief Supt. Arnold Gunnacao, regarding Apec preparations.

Nonworking days

ALTHOUGH Malacañang has declared the Apec duration as nonworking days, Carlos said there are

aderLook measures for Apec summit

sMirror

www.businessmirror.com.ph | Thursday, November 12, 2015

MMDA app and bikes for Apec

still some employees of companies, especially business-process outsourcing firms, who continue to report for work. “Traffic will still be a problem… because private sector is still there [they have not declared holidays],” he said. During the Apec summit, the two inner lanes of Edsa, stretching from Shaw Boulevard in Mandaluyong City all the way to Mall of Asia in Pasay City, will be exclusive for the use of Apec delegates. For his part, Almendras renewed his appeal to the public for understanding for some inconvenience during the Apec summit. “They [Apec delegates] have their own protocols…they are used to a certain amount of security and leniency and flexibility. Thereby, that protocol is something we have to give to them when they come here…. I have been saying to media in all of my interviews, our Apec lane is to be used by delegates along Edsa but when a very important person is passing through, there will be absolute closures,” he said. “I am appealing to all the motorists, all the people. We are hosting a very big event. So many important people that we need to make sure are going to be safe and can move around normally in a way they are able to move. So we really like to appeal, if you don’t really have to do anything absolutely urgent in these areas, then better not to…although some streets will be opened, but if there’s a movement then we will close it,” Almendras said. Such total road closures will last at least 30 minutes, he added.

Road closure

THE Manila District Traffic Enforcement Unit-Manila Traffic Parking Bureau said road closure will be implemented from 12:01 a.m. on November 16 to 12 midnight of November 20 in the following areas: n Stretch of Roxas Boulevard north and southbound lane from

Katigbak Drive to Pablo Ocampo Street; n Stretch of Roxas Boulevard service road from Santa Monica Street to P. Ocampo; n Stretch of Quirino Avenue, from Roxas Boulevard to Adriatico Street; n Stretch of Century Park Street from Adriatico to Mabini Street; n Stretch of Mabini from P. Ocampo to Quirino; n Southbound lane of Adriatico from Quirino to Century Park; n Stretch of P. Ocampo from Adriatico to Roxas Boulevard; n Stretch of Marcelo H. del Pilar Street from Santa Monica to Malvar Street; n Stretch of Pedro Gil Street, from Roxas Boulevard to Mabini.

Rerouting

ALL vehicles coming from the northern part of Manila Pier zone intending to utilize the southbound lane of Roxas Boulevard shall turn left to P. Burgos Street, right to Maria Orosa Street or Taft Avenue to point of destination. n All vehicles coming from the southern part of Manila intending to utilize the northbound lane of Roxas Boulevard shall turn right to Buendia Avenue, turn left to Taft Avenue to point of destination. n All vehicles utilizing P. Ocampo coming from Taft shall turn right to Adriatico, turn right to Leveriza Street to Quirino Avenue to point of destination. n All vehicles traveling westbound lane of Quirino Avenue coming from Osmeña Highway (Plaza Dilao) area going to Roxas Boulevard shall turn right or left to Taft Avenue to point of destination; n All vehicles coming from del Pilar Street intending to utilize Roxas Boulevard shall turn left to Quirino Avenue going to Taft Avenue to their point of destination. Totally no parking on Roxas Boulevard service road from Teodoro M. Kalaw to President Quirino will be implemented.

THE MMDA will use new highperformance motorcycles for the security and traffic management personnel who will be deployed during the summit. The recently purchased 10 new Suzuki Bandit 750 motorcycles will be used by high-ranking officials who will participate in Apec, as well as part of complying with international conventions on the protection of visiting heads of state. The new 10-bike fleet will be joined by two previously acquired Ducati Monster 795s, which the MMDA first used during the visit of Pope Francis in January. The Ducati bikes cost around P500,000 each, while the Suzukis were procured by the MMDA at a slightly lower price. From the airport, the Apec convoys would be using Skyway where only motorbikes with 400cc engines or higher are allowed, hence the MMDA’s old fleet of motorcycles and scooters would simply not do. Meanwhile, Carlos said some 60 traffic constables have already undergone training in using an app for emergency response and roadside assistance to ensure the smooth flow of traffic during the event. He said that the tablets, donated by Pure Force—a private company providing emergency response and rescue solutions who developed the Pure Force Citizens App—will also be used by emergency and traffic personnel of the agency for direct reporting in their Command Center. “It would be easy for us to respond immediately, and all the information sent to us will be more accurate because it is accompanied with pictures as well,” Carlos said. He said 200 more tablets are expected to be given to the agency. The tablets were turned over earlier by Jomerito Soliman, Pure Force president and chief executive officer.

Number coding not lifted

ALTHOUGH Malacañang declared November 18 and 19 as special nonworking holidays, the number-coding scheme will still be implemented during the fourday summit. Carlos said that the “numbercoding” scheme will still take effect from November 16 to 20 to decongest the metropolis. Because of this, Carlos appealed to motorists to cooperate for the successful holding of the Apec summit. The MMDA, Carlos said, is expecting heavy traffic near bus terminals in the metropolis on November 13, as people are expected to go to provinces ahead of the Apec summit. Carlos said many people will start going to provinces as early as November 13 for a long vacation. Malacañang declared November 18 and 19 as special nonworking holidays. It also announced that there will be no work in government offices from November 17 to 20, as the country hosts the Apec meet. Exempted from the suspension are government agencies involved in basic services, security and safety, health and emergency preparedness and Apec-related activities. There will also be no classes in all levels in Metro Manila from November 17 to 20. He said more people are expected to take the long Apec holidays as an opportunity to go to the provinces. Because of this, Carlos warned that traffic might be heavy in areas near bus terminals and airports. He also said there might be traffic jams in some malls in Metro Manila since November 13 is also a payday.

Indigenous peoples, collectively known as lumad, display placards during a news conference on Friday to protest alleged moves by the government to evict them from their encampment during the 2015 Apec summit in Manila. The lumad, who arrived from southern Philippines two weeks ago, are protesting the alleged killings of three of their leaders by paramilitary forces, as well as increased military presence in their ancestral lands.AP/Bullit Marquez

A6 Thursday, November 12, 2015 • Editor: Angel R. Calso

Opinion BusinessMirror

editorial

In defense of bacon, hot dog, ham, tocino, salami and longganisa

he Western media dubbed October 26, 2015, as the “bacon freak-out day.” On this Monday, the World Health Organization’s International Agency for Research on Cancer (IARC) announced that “there is convincing evidence” that eating bacon, salami, hot dog, ham and other processed meats can increase the risk of cancer in humans. For Americans who eat far more bacon than what’s good for planet Earth, the warning jars the pillars holding up the immortal words of Homer (Simpson, not the other one): “Mmmmm. Bacon.”

As expected, the IARC report created a tsunami of panic among bacon, ham and hot-dog lovers. Who wouldn’t be alarmed when one sees newspaper headlines like this one in the Guardian: “Processed meats rank alongside smoking as cancer causes—WHO.” The newspaper headline is accurate, because the IARC has, indeed, included processed meat in Group 1 of its cancer list, the highest tier reserved for established carcinogens—including sunlight, cigarettes, alcohol and asbestos. However, it does not mean that processed meat is as bad for you as smoking. Specifically, the IARC researchers found evidence that eating a 50-gram portion of processed meat daily (about one hot dog or two bacon strips) can increase a person’s relative risk of colorectal cancer by 18 percent. Since a person’s lifetime risk of colorectal cancer is about 5 percent, daily meat consumption seems to boost that absolute risk by one percentage point to 6 percent (or 18 percent of the 5-percent lifetime risk). Brad Plumer, who writes for Vox, tweeted a more precise figure: “If you ate a hot dog every single day, your lifetime risk of colorectal cancer would rise from ~4.5 percent to... ~5.3 percent.” In the same report, the IARC concluded that unprocessed red meat was “probably carcinogenic.” The evidence here is less definitive, but the IARC said that eating about 100 grams of unprocessed red meat a day (about one hamburger) seemed to increase the risk of colorectal cancer by about the same small amount. Ed Yong, writing for The Atlantic, scored the IARC report, saying that the classifications are based on strength of evidence, not degree of risk. “So, these classifications are not meant to convey how dangerous something is; just how certain we are that something is dangerous. It’s one thing to establish causality. It’s another thing entirely to tell us what the risks actually entail. Until then, what we have is a classic ivory-tower mentality: a group of academics who hole up in a room, make proclamations to the world, and ignore the chaos that consistently ensues. Perhaps, we need a separate classification scheme for scientific organizations that are ‘confusogenic to humans.’” As Yong pointed out, the trouble is that the IARC uses a confusing scale for classifying carcinogens. It tells us what can cause cancer, but not how big the risk is. In this case, “bacon causes cancer” does not mean that eating bacon will definitely give you cancer. It just means that eating bacon increases your risk of cancer by some small amount. Given these facts, we ask: Does bacon cause cancer? Sure. Will bacon cause cancer in you? Probably not. Since 2005

BusinessMirror A broader look at today’s business Ambassador Antonio L. Cabangon Chua Founder Publisher Editor in Chief

T. Anthony C. Cabangon Jun B. Vallecera

Associate Editor News Editor City & Assignments Editor Special Projects Editor

Jennifer A. Ng Dionisio L. Pelayo Vittorio V. Vitug Max V. de Leon

Online Editor

Ruben M. Cruz Jr.

Research Bureau Head Creative Director Chief Photographer Chairman of the Board & Ombudsman President VP-Finance VP-Corporate Affairs VP Advertising Sales Advertising Sales Manager Group Circulation Manager

Dennis D. Estopace Eduardo A. Davad Nonilon G. Reyes Judge Pedro T. Santiago (Ret.) Benjamin V. Ramos Adebelo D. Gasmin Frederick M. Alegre Marvin Nisperos Estigoy Aldwin Maralit Tolosa Dante S. Castro

PSE investors have ‘bad’ attitude John Mangun

OUTSIDE THE BOX

hilippine stock-market investors have a bad attitude. By that, I mean they are like UFC champion fighter Ronda Rousey, who will not take nonsense from anyone, including Floyd Mayweather Jr. In the case of local Philippine Stock Exchange (PSE) investors, it is the government, stockbrokers, and economic and stock-market “experts” that are offering all the nonsense.

In 2015 the PSE was, in part, given back to local investors from the foreigners. Although it may be true that foreigners still do a significant, if not majority, amount of the daily trading on the exchange, this is what has happened. We have been told that foreigners have been selling out of the PSE in the last months. That is true, based on what the net transactions of daily foreign buying and selling tell us. However, a closer look at foreign ownership reveals something different. If you compare the total percentage of foreign ownership of many widely held issues between the end of 2014 and now, you see a small change. One particular issue has seen its foreign ownership drop by 1.5 percent. Another bluechip stock has actually had foreign ownership increase this year by 1.5 percent. So, how can we say foreigners are net sellers of the PSE, when the

Trump’s bad night Margaret Carlson

BLOOMBERG VIEW

BusinessMirror is published daily by the Philippine Business Daily Mirror Publishing, Inc., with offices on the 3rd floor of Dominga Building III 2113 Chino Roces Avenue corner De La Rosa Street, Makati City, Philippines. Tel. Nos. (Editorial) 817-9467; 813-0725. Fax line: 813-7025. (Advertising Sales) 893-2019; 817-1351, 817-2807. (Circulation) 893-1662; 814-0134 to 36. E-mail: news@businessmirror.com.ph.

HOM

www.businessmirror.com.ph

regional offices

n DXQR -93dot5 HOME RADIO CAGAYAN DE ORO E-MAIL ADDRESS: homecdo@yahoo.com ADDRESS: Archbishop Hayes corner Velez Street, Cagayan de Oro City CONTACT NOs.: (088) 227-2104/ 857-9350/ 0922-811-3997 n DYQC -106dot7 HOME RADIO CEBU E-MAIL ADDRESS: homecebu@yahoo.com ADDRESS: Ground Floor, Fortune Life Building, Jones Avenue, Cebu City CONTACT NOs.: (032) 253-2973/ 234-4252/ 416-1067/ 0922-811-3994 n DWQT -89dot3 HOME RADIO DAGUPAN E-MAIL ADDRESS: homeradiodagupan@ yahoo.com ADDRESS: 4th Floor, Orchids Hotel Building,

Rizal Street, Dagupan City CONTACT NOs.: (075) 522-8209/ 515-4663/ 0922-811-4001 n DXQM – 98dot7 HOME RADIO DAVAO E-MAIL ADDRESS: home98dot7@gmail.com ADDRESS: 4D 3rd Floor, ATU Plaza, Duterte Street, Davao City CONTACT NOs.: (082) 222-2337/ 221-7537/ 0922-811-3996 n DXQS -98dot3 HOME RADIO GENERAL SANTOS E-MAIL ADDRESS: homegensan@yahoo.com ADDRESS: 2nd Floor, Penamante Clinic Tiongson Street, General Santos City CONTACT NO.: 0922-811-3998 n DYQN -89dot5 HOME RADIO ILOILO E-MAIL ADDRESS: homeiloilo@yahoo.com

ADDRESS: 3rd Floor, Eternal Plans Building, Ortiz Street, Iloilo City CONTACT NOs.: (033) 337-2698/ 508-8102/ 0922-811-3995 n DWQA -92dot3 HOME RADIO LEGAZPI E-MAIL ADDRESS: homeradiolegazpi@ yahoo.com ADDRESS: 4th Floor, Fortune Building, Rizal Street, Brgy. Pigcale, Legazpi City CONTACT NOs.: (052) 480-4858/ 820-6880/ 0922-811-3992 n DWQJ -95dot1 HOME RADIO NAGA E-MAIL ADDRESS: homenaga@yahoo.com ADDRESS: Eternal Garden Compound, Balatas Road, Naga City CONTACT NOs.: (054) 473-3818/ 811-2951/ 0922-811-3993

Printed by brown madonna Press, Inc.–San Valley Drive KM-15, South Superhighway, Parañaque, Metro Manila

percentage of foreign ownership has not changed? Let’s say, a foreign fund owned a billion pesos of shares at a price of P100 and sold those shares. If later, they bought back an equal number of shares when the stock price was P50, they would be “net sellers” of P500 million. However, the percentage ownership of the company might not have changed at all, based on the number of shares outstanding and foreign owned. For example, a company had 21percent foreign ownership when the price was P4.50 and 21-percent ownership when the price recently went down to P3.40. Yet, net foreign selling in that six-month period was several billion pesos. Unlike local stock-market “gurus and experts,” fund managers rarely average the purchase price down over the long term. While the “gurus” may have an unlimited amount of capital to do that, funds allocate a

he fourth debate of Republican candidates started badly for the front-runner Donald Trump. He was booed when he put down John Kasich with his oft-repeated line that the Ohio governor’s turnaround of his state’s economy was due to a windfall from fracking. That only gave Kasich an opening to give a granular enumeration of his achievements. He had another bad moment when he went off on a rant against the TransPacific Partnership and its supposed benefits for China, only to be corrected by Sen. Rand Paul, who pointed out that China had no part in the deal. The real-estate mogul tried to rally by answering a question about Syria, Ukraine and Russia with a boast that he could deal with President Vladimir Putin because they “were stablemates on 60 Minutes and that went pretty well.” This time, he was put in his place by Carly Fiorina: “I’ve met him, as well, but it wasn’t in a green room before a show. It was a private meeting.”

Fiorina has become Trump’s nemesis, putting him down at the second debate with the observation that everyone everywhere heard his remarks about her face. In Milwaukee on Tuesday night, his irritation with her showed: After Fiorina tried to talk over Paul, Trump jumped in to ask, “Why does she keep interrupting everybody.” That, too, elicited a hostile response from the crowd, which took her side against him. Trump was all bombast, but in this debate it was those with substance who shined brightest—Kasich, Marco Rubio and Ted Cruz (though he had a

certain percentage and amount of money from their total portfolio to a particular stock. They buy and, if the price goes down, they sell. They may buy again at a lower price and sell again if the price continues going down, looking to get in at the price bottom. Investment funds are not going to put “fresh” money into a declining market. But that does not mean that they are going to walk away, as we have been told, just because prices are going down. However, it’s always new money coming into the market that increases prices higher or money shifted out of the “losers” into the “winners.” But based on the total performance of the PSE indexes since April, new money has not been coming in, and it has primarily been the locals that have been pulling money out of the PSE. At this point, the only way the local stock market is going to go up is if locals bring new funds back in, and that has not been happening. Filipino investors have not been buying the hype from the government, stock brokers, or the “experts” about economic fundamentals, corporate value, and how well the Philippines can handle “global headwinds.” So, why aren’t Filipino investors excited about the prospects of stock prices going higher? In my opinion, the government, in order to advance its May 2016 election agenda, is pushing too hard. If you elect a certain candidate, the Philippines will become a

“First World Nation” may be a good campaign slogan. But do you really want to “bet” your money in the stock market for that “First World” promise to happen? Reading the newspapers, you might think that all of the Philippines’s problems, like a major drop in exports and potentially lower economic growth, are caused by “external factors” like the lack of rain or problems in China. That may be true or not, but the “causes” of the potential problems are not important. You can ignore the causes of the problem but you cannot ignore the problem itself. A slowdown in remittances, lower agricultural production and a piddling increase in government spending may result in lower economic and corporate profit growth. That does not give investors the confidence to run out and buy shares in a stock market that is in a declining trend. The government and the experts may tell me that Santa Claus is coming to town, but I want to see the big bag full of toys before I put my money on the table. It may be a “bad” attitude not to trust Old Saint Nicholas, but that is what keeps you from losing money in the stock market.

Rick Perry-esque flub when he tried to list the government agencies he would kill off). Paul even sounded informed when he explained his case for a weak military. And Trump’s signature issue, immigration, did not serve him well. He gave his usual tough-guy speech on deporting all immigrants and forcing Mexico to pay for a wall. Kasich and former Gov. Jeb Bush both took him on, pointing out how ridiculous his proposal was. They got applause from a Republican audience. The act could be wearing thin. The magnate’s closing statement was all-Trump and no cattle. He was supposed to be telling people how he would fix the economy, but he engaged in more chest-thumping about the “tens of thousands of jobs,” he’s created with “the most iconic assets anywhere in the world,” and promised to make America “even more special.” The repetition, the self-regard, the bragging have worked for him until now. But next to candidates who know something, he seemed shallow and unprepared. Go to a transcript and look for a sustained answer on policy. You won’t find one.

Panicked Republicans were wondering what they could do to bring Trump down to earth. It turns out the debates, for all their failings, may do the trick. Sure, the candidates embarrassed themselves by whining about the tone of the last one. They demanded less snark and more respect from Republican-friendly moderators. They got that, so much so that Fox Business News host Neil Cavuto said, “My goal is to make myself invisible.” Mission accomplished. Midway through the debate, five candidates spoke one after another without anyone stopping them. The bell signaling time’s up was ignored most of the time. Music played at one point to indicate a commercial break but even then the moderators were unable to cut in. The net result was to allow the candidates to take each other on, giving viewers a few memorable moments that no moderator could have orchestrated. We’ve been told that at some point, Republican voters would get past their anger and begin to look for a candidate who might be able to lead the country. That process finally may have begun Tuesday night.

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

Tax guidelines for Uber, GrabTaxi and other TNCs

Assurance of victory and deliverance Msgr. Sabino A. Vengco Jr.

Alálaong Bagá

Atty. Rodel C. Unciano

Tax Law for Business

iven the increasing popularity of the transportation business called transport network companies (TNCs), the Bureau of Internal Revenue (BIR) recently issued guidelines for the taxability of TNCs, such us Uber, GrabTaxi, their partners/ suppliers and similar arrangements. Under Revenue Memorandum Circular (RMC) 70-2015 dated October 29, the BIR defined a TNC as a pool of land-transportation vehicles whose accessibility to the riding public is facilitated through the use of a common point of contact, which may be in the form of text, telephone and/or cellular calls, e-mail, mobile applications or by other means. The payment of fares by the passengers may be made through the same platform or may be made to the driver of the vehicle directly and maybe paid for in cash, debit card, credit card, mobile payment or any other mode of payment. The BIR has identified at least five types of taxpayers that are engaged in the TNCs, each of which has taxability different from the others. They are 1) a TNC classified as common carrier; 2) a TNC classified as a service contractor; 3) a Partner classified as a common carrier; 4) a Partner classified as a transportation service contractor; and 5) employees. The BIR referred to as “Partner” is the person and/or entity that owns the vehicles used in transporting passenger and/or goods other than the TNC itself. Payments between and among TNCs and their Partners may take the form of either (1) The TNC paying its Partners a portion of the proceeds it receives from its customers; or (2) The Partners paying the TNC an amount out of each contract of carriage received from its customers. The vehicles in the pool may either be driven by the owner or partner, or driven by the driveremployees of the owner or partner. In other words, if the owner or partner does not drive the vehicle himself but engages the services of a driver, the latter is considered as an employee, subject to the applicable taxes on employer-employee relationship. In cases where the TNC itself owns the vehicle, TNC shall issue an official receipt (OR) to the passenger or customer for the total amount of money received from the passenger or customer. If the TNC is a holder of a valid and current certificate of public convenience (CPC) duly issued by the Land Transportation Franchising and Regulatory Board (LTFRB), the TNC is classified as a common carrier and should issue a nonvalue-added tax (VAT) OR and is liable for the 3-percent common carriers tax under Section 117 of the Tax Code on its gross receipts. If the TNC is not a holder of a valid and current CPC, it is classified as a landtransportation service contractor

and should issue a VAT OR and is subject to the 12-percent VAT. In cases where the Partner owns the vehicle, the Partner shall issue to the passenger or customer for the total amount of money received from the passenger or customer. If the Partner is a holder of a valid and current CPC, it is classified as a common carrier and should issue a non-VAT OR and is subject to the 3-percent common carriers tax. However, if the Partner is not a holder of a valid and current CPC, said Partner is classified as a land transportation service contractor, and should issue either a VAT OR when it is a VAT-registered taxpayer or a non-VAT OR if it has not exceeded the threshold amount of P1,919,500 and has not opted for VAT registration. Upon receipt of payment by the partner from the TNC, or receipt of payment by the TNC from the partner, an OR shall be issued, which may again either be a VAT or non-VAT OR, depending upon the classification of the income recipient, that is, whether the recipient is classified as a common carrier or a land-transportation service contactor. In addition, the BIR, likewise, emphasized proper compliance with the applicable creditable/expanded withholding tax, final tax, tax on compensation of employees and other withholding taxes made by TNCs to partners, or payments made by partners to TNCs, as the case may be, are subject to creditable/expanded withholding tax. The BIR emphasized the need for the registration of business, issuance of ORs and proper withholding of taxes as noncompliance therefrom, and are subject to both civil and criminal liabilities under the Tax Code. With the issuance of RMC 70-2015, business entrants in the TNC as defined in the circular are expected to observe proper tax compliance and contribute a fair share to the government coffers. The author is a senior associate of Du-Baladad and Associates Law Offices, a member-firm of World Tax Services Alliance. The article is for general information only and is not intended, nor should be construed as a substitute for tax, legal or financial advice on any specific matter. Applicability of this article to any actual or particular tax or legal issue should be supported therefore by a professional study or advice. If you have any comments or questions concerning the article, you may e-mail the author at rodel.unciano@bdblaw. com.ph or call 403-2001 local 140.

N the presence of God, one is assured of joy and confidence that one will not be abandoned but rather shown the path to life (Psalm 16:5, 8-11). When the last day comes, the Son of Man will come in the clouds in full glory and all the elect will be gathered (Mark 13:24-32).

The Lord is my inheritance IN a lyrical expression of trust in God, Psalm 16 proclaims God as one’s refuge and protection in life, one’s Lord in covenant communion. This specific relationship is captured by two images used: God is the allotted portion of land originally distributed among the tribes of Israel, the inheritance that gives one identity and sustenance; God is also the cup passed around in the assembly from which all drank to indicate unity, the cup of intimacy with God. And the psalmist is assured of his inheritance and future because it is the Lord no less who holds it fast and secure. It is the Lord who guides and counsels the psalmist. The entire being of the psalmist is filled with confidence and gladness in the Lord: in his heart, in his inner depths, he is instructed by God even at night when irrational feelings well up

N 1898, just before the dawn of the automobile age, delegates from around the world came to New York for the world’s first international urban planning conference. One topic dominated the discussion. It wasn’t the effects of the coming car revolution on urban land use, the need for gasoline stations or the implications for economic development. It was horse manure. At that time, Americans used roughly 20 million horses for transport, and cities were drowning in their muck. But we shouldn’t mock our forebears because our current planning debates are just as rooted in the present, just as ignorant of the oncoming avalanche of changes. As the delegates in New York obsessed over horses when they should have been thinking about cars, our policy wonks obsess over cars when they should be thinking about autonomous vehicles.

Consider that the first semi-autonomous vehicles are already on the roads. Fully autonomous cars could be available for purchase as soon as 2020. It’s widely expected that AVs will be cheaper to operate and travel faster than cars; be fleetowned (individual ownership won’t be worthwhile if AVs are both affordable and guaranteed to arrive promptly); and mostly use electric and/ or hybrid power. Given these assumptions, let me sketch out a few high-level implications. Fleet ownership of AVs could reduce the number of cars on the road by 60 percent to 90 percent due to more efficient usage and, consequently, reduce car sales by an equivalent percentage. Many of the 1 million jobs in US auto manufacturing will probably disappear. More than 2.5 million driving jobs (there are 1.7 million truck drivers, 650,000 bus drivers and 230,000 taxi drivers—about 2 percent of the US work force) will also be eliminated or

inside him, and also in his body, his fragile and corruptible flesh, he rests secure in God and feels profound joy. He is sure that God will not abandon him to death and corruption, to sheol and the pit where the body is buried. The psalmist’s trust is unshakeable; God is steadfast. God is the one to teach him the path to life. And in the presence of God is fullness of joy; at His right hand under His powerful protection there is forever delight.

He will come with great power and glory

The gospel allusions to the tribulations preceding the coming of the new age and the advent of the Son of Man in the clouds are apocalyptic traditions Jesus used to teach His disciples. The portrayed distress taking hold of the world accompanied by cosmic occurrences indicate that all creation will be in disarray.

It is a final replay of the primordial conflict between order and chaos. As God’s creative power in the beginning brought chaos under control, so now its return in reversal of the order of creation presages the birth of the new age of fulfillment. The advent of the Son of Man in the clouds (Daniel 7:13) heralds the coming of the new age; He comes with great power and glory, not in fury and destruction, not to scatter the elect but to gather them. Angels of the Lord will gather the elect from the four winds, from every corner of the earth and boundary of the sky. It is the “Day of the Lord,” the time of harvest, a joyful occasion when God’s victory over the enemies of Israel will be celebrated. For many it will be a time of rejoicing; for some it will be a time of terror, one of wrath and judgment (Amos 5:18-20).

His words will not pass away

Jesus uses the parable of the fig tree, a staple fruit in the Middle East that grows in abundance and often presented as a symbol of the messianic age. The tree’s blossoming in the spring is a reliable sign of the approach of summer. So also, the happening of the things He has described points to the advent of the Son of Man. He is near at the gates. But unlike the ripening of the figs expected at a particular time of the year, the precise time of the coming of the new age, its exact day or hour, is shrouded in mystery.

No one knows the exact time, neither the angels in heaven nor the Son of Man, only the Father. But all these things will certainly take place. Boldly Jesus states that heaven and earth will pass away, but His words will not pass away or be proven empty. And He does not contradict Himself in saying that all these events will happen before “this generation” passes away. The generation referred to is the period of time of the present age. His words stand as we rely on Him that the world as known will pass away and all its chaos, even as the new age of joy and order comes in. Alálaong bagá, all things are in God’s hands. If in the beginning of time God’s supreme authority prevailed over chaos and placed order in creation, so at the end of time the new creation will usher in cosmic order, fulfillment of joy and the victory of love. Good will ultimately and completely triumph over evil. It is all the exclusive work of God, and we trust Him. But we need to be ready for the coming tribulation and prepared for the advent of the Son of Man. As we come close to the end of our yearly telling of the story of salvation, we are confident of God’s loving and merciful power. Join me in meditating on the Word of God every Sunday, 5 to 6 a.m. on DWIZ 882, or by audio-streaming on www.dwiz882.com.

Wish Cameron luck with his EU blackmail

By Marc Champion | Bloomberg View

the irony is that if we followed the model of Norway, Europe’s political interference in our country could actually grow, rather than shrink. Or take trade. How would the UK be able to renegotiate better trade deals with other major economic powers, without having the heft of a 500 million-person market as leverage?” Then he moved onto national security. The world, Cameron noted, has only become more dangerous since he laid out his reform-followed-by-areferendum strategy at Bloomberg’s London office three years ago, what with the rise of Islamic State and Russia’s invasion of Ukraine. So it would be an odd time to abandon the EU, an important “tool” for achieving Britain’s security goals. “Our membership in the EU does matter for our national security and for the security of our allies. Which is one reason why our friends in the world strongly urge us to remain in the EU.” These are big considerations, the kind that led him to say that decision Britons make at the referendum, which could come as early as next June, will be, perhaps, “the biggest we will be making in our lifetimes.” It would also be irreversible, he said, and would affect the lives and fortunes of their

children and grandchildren. So what’s in these make-or-break reforms that could outweigh his case? The most substantive is Cameron’s demand to restructure the EU so that the UK and other countries not in the euro zone won’t be disadvantaged by those inside, or forced into deeper integration that they neither need nor want. This matters but it’s debatable whether it can be best achieved by Britain threatening to leave the bloc. Or to put it another way: it’s too important to be achievable on the timetable Cameron has set for his referendum, so at best he’s likely to get an unenforceable promise to change treaties later. His second request is to make the EU more economically competitive. As Cameron’s speech indicates, this is something for which the UK has always pressed and won’t be achieved in a big-bang reform. His third categor y concerns national sovereignty. He wants greater powers for the EU’s national parliaments and an opt-out from the EU’s symbolically important principle of ever-closer union. And finally, there’s immigration. Cameron’s most problematic request is for a four-year delay before migrants from the EU can claim welfare benefits in the UK. By saying he’s open to other suggestions, Cameron acknowledged as much. C r it ics who say C a meron’s demands are meaningless are simply wrong. If he could succeed in getting Europe to quickly implement meaningful reforms on all four points, he would have achieved a great deal. EU

populists might try to follow in his footsteps—one reason Cameron’s tactics are so resented on the continent. (The headline on the front cover of Wednesday’s edition of French newspaper Liberation is: “Le Chantage de Cameron,” or Cameron’s Blackmail.) But what if he doesn’t succeed? What if he gets patently unenforceable pledges of future treaty changes that fool no one, coupled with a refusal to let Britain discriminate in giving welfare payments to immigrants? None of this would make Britain worse off than it is today, but it could force him to make good on his threats. Would Cameron really be willing to urge Britain out of the EU because he failed to reform welfare rules that would in any case have little impact on immigrant numbers? Economic migrants don’t come to the UK in the hopes of being unemployed. Cameron’s speech was a reminder that his decision three years ago to make Britain’s referendum contingent on first reforming the EU was not driven by a strategic analysis of the UK’s best long-term interests; it was a tactic to keep anti-European rebels in his own party under control ahead of this year’s elections. He succeeded in that, but now he and Europe are stuck with the consequences of his tactic. Everyone, on both sides of the English Channel, should now wish Cameron success in his attempt at blackmailing other EU leaders into taking actions they should take anyhow. Then the real arguments for and against membership can begin.

these savings could be $400 billion to $1 trillion a year, and should be reflected in lower transportation costs. More good news is that land currently tied up for parking can be repurposed for other uses. Again, assuming expanded fleet ownership and less individual ownership, AVs won’t need to park in city centers. Of course, changes in land use won’t benefit everyone equally. AVs could facilitate a significant shift to housing away from city centers, thereby reducing central urban property values and increasing values in outlying areas. For example, New York has several neighborhoods not accessible to mass transit, but AVs may open these areas to development. In 1898, the US population was about 74 million, and there were only 800 registered cars. By 1927—less than 30 years—the US had more than 19 million cars on the road, and more than 55 percent of American families owned one. The 20th century shift to

automobiles, within the span of a normal human life, destroyed many existing sectors (anything to do with maintaining 20 million horses, for example). Entirely new laws, regulations and infrastructure (roads, tunnels and bridges suitable for motor vehicles, gasoline distribution and much else) had to be created. The delegates to the 1898 urban planning conference failed to recognize the developments that would transform their world. Today’s transportation infrastructure discussions— about building a $10-billion bus terminal in New York, or a $70-billion high-speed rail system in California—may prove similarly shortsighted. These transportation mega-projects don’t seem to take AVs into account. Yet by the time these initiatives are completed, AVs will be a major part of the transportation landscape. AV minibuses, providing home to office direct service, may completely replace traditional buses. And there’s little doubt that AVs will radically

change the economic calculations and assumptions that make high-speed rail projects seem worthwhile (i.e., the speed and cost of travel by conventional car). Policy leaders need to seriously consider winding down vocational schools that teach bus and truck driving as a career. Cities need to start rethinking their housing policies. And that’s not all. As AVs facilitate a shift to electric and hybrid vehicles, highway trust fund revenue, which comes from the gasoline sales tax and pays for most federal road work, will collapse. How will road repair be funded going forward? All sorts of technological, legal and regulatory barriers must be addressed for AVs to deliver their full potential. But these barriers aren’t higher than those encountered in the shift from horses to conventional cars. Autonomous vehicles are coming. We need to stop thinking within the limitations of the past and focus instead on the tectonic shifts of the future.

hat will British Prime Minister David Cameron do if he fails to get all or some of the reforms he is demanding from the European Union (EU)? On Tuesday he threatened to lead the United Kingdom out of the union, but let’s hope he’s bluffing.

Cameron has finally put his demands for European reform into writing and the four points he laid out contain no surprises. The speech he gave to present them, however, was revealing. He set himself a difficult task: to convince British voters that his four points would represent fundamental change in the union, while at the same time persuading the rest of Europe that he’s asking only for “reasonable” achievable modifications. It’s a tribute to Cameron’s skill as a communicator that he managed to paper over the contradiction. And yet, it is there. For the first time, Cameron began in his speech to lay out the case for staying in the EU, which will please his European partners. He also, however, insisted that he won’t make up his mind as to whether staying is the right thing to do until Europe has responded to his demands. That will appease the home team. Trouble is, his case for staying is too convincing. He starts with “economic security.” Those who think the UK should leave need to explain why Britain would be better off like Norway, he said: “Bound to apply EU rules to gain access to the single market, but unable to influence the shaping of those rules. So

What cars and horses have in common By Steven Strauss | TNS

Thursday, November 12, 2015

transformed. In terms of the resulting human disruption, remember that all of these workers are part of families and communities; the loss of their jobs will produce a ripple effect. On a positive note, AVs will make our roads safer and bring major savings in health care and auto repair. About 33,000 people die each year in auto accidents. In 80 percent of the cases, the cause is alcohol consumption, driving in excess of the speed limit or a distracted driver. Computers should have none of these problems. Highway accidents have direct costs of about $240 billion a year and more than $800 billion a year if quality-of-life issues are included. AVs have the potential to eliminate most of these deaths and costs. Relatedly, the automobile insurance industry (which now has revenue of about $200 billion) will shrink dramatically. Fewer accidents will mean fewer claims and lower premiums. The benefit to the economy from

2nd Front Page BusinessMirror

A8 Thursday, November 12, 2015

house AIMS final ok of excise tax on sweetened drinks by dec By Jovee Marie N. dela Cruz

he chairman of House Committee on Ways and Means on Wednesday said the lower chamber will approve a measure imposing an excise tax of P10 on sugar sweetened beverages before the year-end. Liberal Party Rep. Romero S. Quimbo of Marikina, the panel chairman, said the excise tax of P10 on sugar-sweetened beverages (SSBs) per liter of volume capacity aims primarily to develop a healthier population and provide an additional revenue of about P34.5 billion for the government. “We will approve it before our [Christmas] break [on December 19]. It’s an important health measure where many of the poor become victims of this cycle of malnutrition and obesity. We need funds to develop sources of potable water for our public school and ordinary communities,” Quimbo said in a text message. On Tuesday the committee approved the substitute bill to House Bill 3365 authored by Unang Sigaw Rep. Estrellita B. Suansing of Nueva Ecija after more than a year of hearings and meetings on the measure. Quimbo stressed that the bill is a health measure more than anything else. “We’ve come to determine that many of the diseases or noncommunicable diseases emanate from the consumption of this readily acceptable commodity [sugar sweetened beverages] especially by our children so the proceeds will serve not only as additional revenue for the government but, more important, to develop really a healthier population,” Quimbo said. According to Quimbo, this can be done by first creating sources of potable water in school and in communities and secondly, by raising the educational awareness of the population in terms of healthier lifestyle, as well as consuming healthy food and drinks. The bill imposes an excise tax on SSBs by inserting a new Section 150-A in the National Internal Revenue Code of 1997, as amended. Section 150-A titled Sugar Sweetened Beverages provides there shall be levied, assessed and collected on sugar-sweetened beverages per liter of volume capacity, an excise tax of P10. The rate of tax imposed under this section shall be increased by 4 percent every year thereafter effective on January 1, 2017, through revenue regulations issued by the secretary of finance. The bill defines SSB as “a nonalcoholic beverage that contains caloric sweeteners/ added sugar or artificial/noncaloric sweetener. It may be in liquid or solid mixture, syrup or concentrates that are added to water or other liquids to make a drink.” The SSB shall include: soft drinks, soda, pop and soda pop; fruit drinks, punches or ades; sweetened beverages of diluted

fruit juice; sports drinks; sweetenwwed tea and coffee drinks; energy drinks; all nonalcoholic beverages that are readyto-drink and in powder form with added natural or artificial sugar. It excludes the following: 100-percent natural fruit juices; 100-percent natural vegetable juices; yogurt and fruit-flavored yogurt beverages with pure fruit and vegetable juice or concentrate; meal-replacement beverages (medical food) and weightloss products; and all milk products, infant formula and milk alternatives, such as soy milk or almond milk, including flavored milk, such as chocolate milk. In terms of allocation of the revenue collection from the excise tax on SSBs, the bill provides that 50 percent shall go to the General Fund; 20 percent to the Department of Health for the provision of medicine and medical assistance to indigent patients with diabetes and or other related diseases through the provincial or district hospitals, and for health and wellness information campaign; 20 percent to the Department of Education to provide access to potable water in public schools (water fountain) and sports facilities and for the community-based obesity, diabetes, dental caries prevention campaigns and other dietrelated health-awareness programs using educational, environmental, policy and other public health approaches. Earlier, Visayan Bloc Leader and Rep. Alfredo Benitez of Negros Occidental said that additional tax on sweetened beverages would adversely affect the livelihood of sugar industry workers. “Sugar is not the culprit in the rising obesity and diabetes problems of riceeating Filipinos,” said Benitez, chairman of the House Committee on Housing and Urban Development. In their letter to Quimbo, sugar industry leaders said that while there remains no local findings pointing to sugar as the cause of diabetes and obesity among Filipinos, proponents of the measure should instead determine the link between rice to the health issues they raised against sugar. The letter was signed by Rafael Coscolluela, president of the Confederation of Sugar Producers Associations Inc.; Enrique Rojas, president of the National Federation of Sugarcane Planters Inc.; Manuel Lamata, president of the United Sugar Producers Federation of the Philippines; Danilo Abelita, president of the Panay Federation of Sugarcane Farmers Inc.; and Francisco D. Varua of the Phlippine Sugar Miller Association. The industry leaders also aired fears that the new tax will trigger an increase in prices of softdrinks and carbonated drinks and will result in the “contraction of the market of refined sugar” and could result reduction of purchases of refined sugar.

Another NGCP transmission tower bombed in Marawi City

HE National Grid Corp. of the Philippines (NGCP) on Wednesday reported another bombing incident involving one of its transmission-line towers in Marawi City. Just eight days after three NGCP towers in Patani, Marawi City, were bombed, the grid operator reported that another tower in the same area was targeted. Tower No. 13 along Agus 2-Kibawe 138-kilovolt (kV) line 2 in Guimba, Marawi City was bombed by yet to be identified perpetrators, making it the 10th tower bombed this year. W hile the explosion did not topple the tower, the damaged it sustained caused it to lean, putting the transmission facility in a more critical condition. On October 29 three towers along the same transmission line were bombed. Of the three, two structures, towers No. 19 and No. 20, were toppled. The third tower, No. 21, sustained damage, but was fortunately not toppled. At 1:50 p.m. of November 9 the NGCP was able to fully restore the Agus 2-Kibawe 138-kV line 2 after implementing temporary measures to transmit electricity produced by

Agus 1 and 2 hydropower plants to the rest of the Mindanao grid. The Philippine National Police and Armed Forces of the Philippines are leading in the investigation and exerting all efforts at catching the perpetrators. “This is the 10th tower bombed by lawless elements in 2015 alone, with five towers bombed within the month of October. “We are very concerned that this situation seems to be escalating, with each incident happening progressively closely to each other,” the company stressed. “With the help of the local authorities, several other bombs were found on our facilities, but these did not detonate and were safely disposed of,” the NGCP said. The NGCP is appealing to the public to help monitor the safety of the towers so that transmission services remain uninterrupted. “If anyone sees anything suspicious at or around our towers and facilities, please inform us immediately. You may text us your tips and other information at 09178791077,” it said. The NGCP is fully cooperating with law enforcement agencies as they investigate the incident. Restoration efforts began as soon as the area was

declared safe. Lenie Lectura

www.businessmirror.com.ph

SPC sets appeal of ₧1.143-billion Naga power-plant deal before SC

By Lenie Lectura

he SPC Power Corp. on Wednesday warned of a possible delay in the construction of a 300megawatt (MW) coal power plant that it plans to build together with Korea Electric Power Corp. (Kepco) in Naga, Cebu, after the Supreme Court (SC) recently nullified a contract awarded to it by the government.

SPC, which had been awarded by the Power Sector Assets and Liabilities Management Corp. (PSALM) the contract to own and operate the 153.1-MW Naga Power Plant Complex (NPPC) in Cebu, has yet to receive a copy of the court decision. Nonetheless, SPC said it intends to file a motion for reconsideration. “The decision, if not reconsidered, will surely set back the construction and introduction of additional new 300-MW capacity in the Visayas grid, which has already thin reserves,” SPC Senior Vice President Alfredo Ballesteros said. Kepco Philippines President and CEO Hyang-Reol Lyu earlier said that the power project is cur-

rently in the feasibility stage. In 2011 Kepco and SPC partnered for a 200-MW clean-coal power plant in Barangay Colon, Naga, Cebu. The power facility was meant to augment the power supply in the Visayas grid. In the coming months ahead, the Department of Energy anticipates that the Visayas would register 1,800 MW of available generating capacity, as against an anticipated demand of 1,600 MW. SPC on Wednesday expressed disappointment over the SC decision, which declared null and void the right of first refusal or the right to top granted to SPC under the 2009 Naga LBGT-LLA (land-based gas turbine-land lease agreement).

Consequently, the SC annulled the NPPC asset purchase agreement (NPPC-APA) and land lease agreement (NPPC-LLA) executed by PSALM and SPC. “Considering the investments that we already poured in after the award and turnover of the asset, if at all, a change in rules should only be prospective and not retroactive. Business cannot develop properly if the rules change in the middle of the game,” Ballesteros said. It can be recalled that PSALM declared Therma Power Visayas Inc., a subsidiary of Aboitiz Power Corp., as the highest bidder for the NPPC, with a bid of P1.088 billion, higher than SPC’s bid of only P858,999,888.88. But SPC exercised its “right to top” the bid, offering PSALM 5 percent more, at P1.143 billion, and 33 percent more than SPC’s original bid during the previous failed auction. Commenting on the bidding process for the NPPC, Ballesteros said that “the bidding rules were very clear and transparent, and it specifically mentioned the right to top of SPC that emanated from its land lease agreement with PSALM on the sale of the LBGT in 2009. Not one of the bidders objected, and all the interested bidders accepted the right to top of SPC.” PSALM, for its part, also defended its decision when it awarded the contract to SPC in 2014.

It said SPC was granted the right to top the highest bid on the sale or lease of the property within the vicinity of the Naga LBGT power facility to give the winning bidder the opportunity to expand, subject to the payment of a premium of 5 percent over the highest bid on these adjacent properties. NPPC is in the vicinity of the Naga LBGT power plant. PSALM said it also sought the legal opinion of the Department of Justice (DOJ) prior to any decision made by the state firm. “For the record, the DOJ affirmed the legality of the ‘right to top’ the adjoining properties within NPPC accorded to the owner of the Naga LBGT power plant in connection with the privatization of NPPC,” PSALM said. The DOJ’s confirmation was made prior to the commencement of NPPC sale process. “We understand that PSALM considered the right to top a necessary condition in the sale of LBGT and its surrounding assets, because these are all interrelated and located in the same Naga Power Plant Complex,” the SPC official said. “What’s even more frustrating is that prior to the release of the bidding documents for NPPC, the provision on the right to top was vetted by the DOJ, which found it to be legal and enforceable,” he added.

Reforestation, waste-to-energy projects eyed for GCF financing

he government will seek funding for massive reforestation and waste-to-energy projects from developed countries in line with its “conditional commitment” to reduce carbon emission by 70 percent under its Intended Nationally Determined Contribution (INDC) through the United Nations Framework Convention on Climate Change (UNFCCC). This as the country’s top environment officials welcome the approval by the United Nations of Green Climate Fund’s (GCF) eight projects worth $168 million to help vulnerable countries cope with climatechange impacts. The announcement came ahead of the 21st Conference of Parties (COP21) of the UNFCCC in Paris, France, in December. Secretary Ramon J.P. Paje of the Department of Environment and Natural Resources (DENR) said the approval of the initial projects under the GCF financing mechanism is a welcome news to all developing nations, including the Philippines, considering that the country is one of the countries most vulnerable to climate change. “The Green Climate Fund, which to date has earned $10.2 billion in pledges, is a very vital mechanism within the UN climate accord to assist developing countries pursue their adaptation and mitigation practices to counter climate change,” he said. “For the Philippines, while we are making significant strides to contribute to the global climate action, the full implementation of our Intended INDCs depends on financing resources, including technology development and transfer, and capacity-building,” Paje said. Paje also said the government looks at the GCF “as a vital source of support for the country to achieve its commitment of reducing emissions by 70 percent or more by 2030, from the sectors of energy, transport, waste, forestry and industry.” DENR Undersecretary for Environment and International Environmental Affairs Jonas Leones said proposals for the reforestation projects, as well as waste-to-

Woman’s job The men may have completed the planting and harvesting of rice in the fields, and it’s now the women’s turn to sort and dry grains under the noontime heat at a basketball court in San Luis, Pugo, La Union. Mau Victa

energy projects to be funded by the UN GCF will be initiated during the Paris climate talks. Reforestation projects, he said, looks beyond the successful implementation of the National Greening Program (NGP), which aims to plant 1.5 billion trees in 1.5 million hectares from 2010 up to 2016. So far, the government claimed to have expanded the country’s forest by over 1.2 million hectares and is seeking a P10.19-billion budget for its implementation next year. “After NGP, we still have 7 million hectares of land to reforest. We also have a lot of landfills we can convert into methane plants,” Leones said. The GCF, a UN special fund, was put up prior to COP21, to help developing countries cope with climate change. Developed countries are expected to commit funding support under the fund for the implementation of various climate-change mitigation and adaptation projects.

“Under the INDC we submitted, we said that we cannot reduce our carbon emissions unless developed countries help us fund climate-change mitigation and adaptation projects,” Leones said. The massive reforestation, he added, is one way the Philippines can achieve its INDC through carbon sequestration. The same way, he said waste-to-energy projects that will convert methane from landfills into energy will reduce the country’s carbon emission. Waste-to-energy projects, according to Leones, is in line with the country’s thrust of efficiently managing solid wastes and shifting to renewable energy at the same time. “Imagine, our waste generation is 40,000 metric tons per day. That is the estimated volume of garbage we produce when our population is 94 million. Now, our population is now over 100 million,” Leones said. There are hundreds of open

dump in the Philippines and local governments are unable to comply the provisions of Republic Act 9003 or the Ecological Solid Waste Management Act of 2000, such as segregation at source, recycling and composting, to reduce wastes. The law also calls for the closure of open dumps or its conversion into sanitary landfill. Leones said the Philippines, being one of those severely affected by climate change-triggered events such as typhoons, landslides and storm surges, will push for financing of various projects that will strengthen its resiliency while reducing its carbon footprint. He said for transportation, which falls under the province of the Department of Transportation and Communications, energy-efficient transport system, use of e-bus and e-jeepneys and use of fuel-efficient engines that is Euro 4-compliant are being eyed. Jonathan L. Mayuga