BusinessMirror 22, 2015

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Thursday 2014 Vol. No. 40 Thursday,18,October 22,102015 Vol. 11 No. 14

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WHILE KEEN ON JOINING THE U.S.-LED TRADE BLOC, AQUINO NOT WILLING TO AMEND CHARTER TO MEET THE DEAL’S REQUIREMENTS

Palace gives confusing tack on TPP T

he Aquino administration has stressed, time and again, that the Philippines wants to join the new trade bloc TransPacific Partnership (TPP). But, while saying this, Malacañang is also maintaining its stand against Charter change—a necessity to meet the highly ambitious liberalization agreements being set by the US-led trade grouping.

INSIDE

Communications Secretary Herminio B. Coloma Jr., when asked if President Aquino would soften his opposition to any move to tinker with the Charter in order to hasten the Philippines’s entry into the TPP, noted that the government is already in the process of fulfilling its commitments for joining the new trade pact.

“We are taking steps to align ourselves with TPP norms,” Coloma said.

But the Palace official quickly added that there had been “no change in the President’s stated position on Charter change.” This means no amendments to the Constitution under his term, a clear barrier to the full membership of the Philippines in the TPP. While the full text of the TPP agreement has

JOKOWI ‘DRIFTS’ IN 1ST YEAR AS ECONOMY STRUGGLES

Asean www.businessmirror.com.ph

Asean-wide advocacy needed Asean-EU Perspective

HENRY J. SCHUMACHER

W

ITH the Association of Southeast Asian Nations (Asean) Economic Community (AEC) being about two months away, Asean continues to organize functional cooperation in Southeast Asia in a wide range of areas through various agencies that implement regional programs under its umbrella. These include, among others, the Center for Biodiversity, the Center for Energy, both of which originate from programs undertaken with the European Union (EU) and are governed by boards made up of Asean senior officials and the Asean secretary-general.

Among the various functional initiatives for economic cooperation introduced in Asean so far, Asean Free Trade Area (Afta) is the most successful one. It was launched in 1992 to increase the group’s “competitive advantage as a production base geared for the world market”; it has worked as an effective tool to sponsor trade liberalization, introduce a practice of adhering to reciprocal commitments and institutionalize constructive dialogue among the region’s members.

Asean’s 10 members remain diverse in terms of their declared political and ideological backgrounds, and while the very large income gap among them is slowly closing, some have more advanced economies than others.

Companies active in Asean or wishing to become active in Asean and take advantage of the opportunities the AEC has to offer, have “wishes” to Asean governments and the Asean Secretariat how to create an environment in which business in Asean can strive and be more conducive to investment and job generation. This is the reason why European Chamber of Commerce of the Philippines (ECCP), years ago, joined attempts to form the EU-Asean Business Council (EABC), composed of European Chambers in Asean and Multi National Corp. active in the region.

The EABC is a strong supporter of Asean’s regional economic integration process. The aims and goals of the AEC, as set out in the Blueprint in November 2007, are welcomed and well supported by European business more generally. Once achieved, they will undoubtedly boost economic and social development in the region to the benefit of the broad population and the countries of Asean. The member-states of Asean should be applauded for their foresight and ambition.

We recognize that the movement toward these aims and goals is a process: the “deadline” at the end of 2015 is just a point in time, rather than a “big bang.” There is much work that remains to be done, and the comments and recommendations included in this paper should be seen as part of this process. Our aim is to highlight some areas where, in our opinion, further work is required to achieve one of the key stated goals of the AEC, i.e., the elimination of nontariff barriers to trade.

The EABC takes a broad overview of market access and trade-flow restrictions across the Asean region and highlights some common themes across the region, namely: n The scope for improvement in efficiency of customs procedures and greater harmonization between Asean member-states; n The need for more predictable application of regulations and procedures; n Continuing restrictions on foreign ownership and control in many sectors; and n The lack of harmonized standards or the mutual recognition of standards across many industries and economic sectors.

ECCP is on the executive board of the EABC and will host an executive board meeting in Manila on October 27. The objective of the EABC is to be a driver for constructive change within Asean, addressing challenges and opportunities Asean offers and to assist companies in their Asean advocacy.

It is in this context that we are inviting readers to join a discussion with a number of EABC board members to hear from them the areas and sectors of advocacy now and to listen to you what other issues need to be researched, addressed and advocated.

This exciting dialogue is scheduled for October 27, 8 to 10:30 a.m., at the Makati Diamond Residences. If you are interested, e-mail me at Schumacher@eccp.com

Thailand’s Saha, Japan partner eye Vietnam

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AHA Group, Thailand’s largest consumer-products conglomerate, is negotiating with its Japanese partner for joint expansion of its logistics and property ventures in Vietnam next year.

The group was approached by its Japanese partner to expand together in Vietnam because the Thai conglomerate has had a presence there for years, a Saha executive said.

Saha has teamed up with Japanese companies to do various businesses in Thailand for more than 50 years.

It understands the working culture of its Japanese partners and has obtained many technology transfers.

Moreover, Thailand has a geographical advantage to expand business to Vietnam. Saha also has experience in logistics and product distribution throughout that country. It set up Saha Vietnam Co. to distribute consumer products in Vietnam via retail outlets over there.

Currently, Saha and a Japanese com-

pany are in the negotiation process for the joint venture. “We want to invest more abroad. For Vietnam, we’re interested in logistics, property and wholesale,” the executive said.

This will not only cash in on opportunities arising from the Asean Economic Community to be formed at year-end but also gain benefits from the Trans-Pacific Partnership trade agreement that Japan signed two weeks ago along with several countries including Vietnam.

If the deal can be concluded, it will help Saha Group to improve its competitiveness in the regional market.

“The regional community will make cross-border logistics more important,” the executive said.

Prior to this, Saha joined hands with Yangon-based retailer MK Group to set up a distribution company in Myanmar as a springboard to distribute and market more products in neighbouring countries. MCT

BusinessMirror Editor: Max V. de Leon • Thursday, October 22, 2015 B2-1

Jokowi ‘drifts’ in 1st year as economy struggles

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INCE taking office a year ago, Indonesia’s President Joko Widodo has had mixed results in his agenda to lift the economy, build infrastructure and reduce inequality.

The former governor of Jakarta was elected as the first leader outside the machinery of the country’s main political parties, on high expectations he could cut corruption and reform the bureaucracy in the world’s largest archipelago. On his inauguration on October 20, 2014, he was feted like a rock star in the capital’s main thoroughfare with crowds swarming around his open horse-drawn carriage.

His popularity among voters and investors has fallen in a year marked by slowing economic growth, policy U-turns and controversy over appointments. Widodo, known as Jokowi, said on his Twitter account on Tuesday that the past year was about laying foundations and the

first step was often the hardest.

“His first year in office has been characterized more by drifting through, rather than a seamless execution of a meticulously thought out master plan,” said Wellian Wiranto, an economist at Oversea-Chinese Banking Corp. in Singapore.

Foreign fund investors have pulled $722 million from Indonesian stocks this year, and the rupiah is down about 12 percent since Jokowi took office, the secondworst performer in Asia. Here’s an assessment of progress in six key areas of Jokowi’s campaign pledges.

Economic growth

JOKOWI pledged to lift economic growth to above 7 percent within

By Butch Fernandez

his term, from an average of 5.7 percent during the decade of his predecessor Susilo Bambang Yudhoyono. Growth slowed to about 4.7 percent in the April-to-June quarter, the weakest since 2009, and in a Bloomberg survey is expected to only grow 5.4 percent next year.

The economy has been hurt by a slump in prices for the commodities that make up more than half of Indonesia’s exports, such as natural gas, coal and palm oil. While that’s out of Jokowi’s control, the government’s economic forecasts were over-optimistic.

Consumer confidence fell to more than a six-year low in September, in a country where domestic consumption makes up over half of the economy, and foreign direct investment has stagnated. A series of recent stimulus measures have amounted to tinkering rather than fresh cash or major structural reforms.

“There is no evidence of a strategy to turn around the economy,” said Paul Rowland, an independent Jakarta-based political analyst. “Tweaks won’t do it unless they add up to a more coherent

strategy that unshackles domestic and foreign investment.”

Bureaucratic reform

IMPROVING spending needs a more efficient bureaucracy, in a decentralized system where civil servants are poorly paid and often act only if there’s an economic incentive.

Jokowi changed the structure of ministries and pledged to fire officials depending on results.

“The decision to rearrange a number of ministries also ate up a lot of time while new senior bureaucrat positions were filled, and it’s arguable that was unnecessary,” said Keith Loveard, head of political risk analysis at Jakarta-based security company Concord Consulting.

“However, one year on there is a sense that the ship of state is settling on a steady course.”

Jokowi reshuffled his economic team in August, and has also shaken up some state enterprises such as PT Pertamina with new management teams. There’s no sign Jokowi has been able to improve regional administrations, See “Jokowi,” B2-2

2 CARS GIVEN AWAY AT the BusinessMirror 10.0 PARTY Lucky raffle winners Aleah Alani of Oakwood (fourth from left) and Sally Lacanilao of OMD (third from right) receive the keys of their brand-new Toyota Wigo small sedans, immediately after the BusinessMirror’s 10th anniversary party held at the House Manila in Remington Hotel on Tuesday night, from the BusinessMirror officials (from left) Aldwin Talosa, manager for Advertising Sales; Frederick Alegre, vice president for Corporate Affairs; Adebelo Gasmin, vice president for Finance; T. Anthony C. Cabangon, publisher; and Marvin Estigoy, vice president for Advertising Sales. ROY DOMINGO

Continued on A2

DENMARK QUEEN IN INDONESIA

Denmark’s Queen Margrethe II, accompanied by her husband Prince Henrik (second from right), arrives at the Soe Karno-Hatta international airport outskirts of Jakarta, Indonesia, on Wednesday. The Danish royal couple is on a five-day visit to the country. AP

Ringgit extends drop as Maybank predicts higher taxes

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ALAYSIA’S ringgit dropped for a fourth day ahead of the budget on Friday, when Malayan Banking Bhd. says there’s a possibility Prime Minister Najib Razak will announce higher taxes to compensate for the loss of revenue from oil.

While the currency has rallied with the rest of emerging markets this month, it’s still Asia’s worst performer as a decline in Brent crude cuts earnings for the region’s only major net oil exporter. Najib will reveal measures to strengthen the ringgit, Trade Minister Mustapa Mohamed said in Parliament on Tuesday, after both the prime minister and the central bank governor earlier stressed there’s no plan to revisit capital controls imposed during

the Asian financial crisis.

“The ringgit continues to retrace lower on weaker oil prices and as the selloff in the US dollar looks to have run its course,” said Khoon Goh, a Singapore-based senior currency strategist at Australia & New Zealand Banking Group Ltd. “The Malaysian budget will also be a focus for the market to see whether ongoing fiscal consolidation can be achieved in a tough environment.”

The ringgit declined 0.7 percent to a two-week low of 4.2955 a dollar as of 10:36 a.m. in Kuala Lumpur, adding to a 3.5-percent loss in the previous three trading days, according to prices from local banks compiled by Bloomberg.

The currency has dropped 18 percent this year amid a 15-percent

slide in Brent crude, which is down more than half since its peak in June 2014.

Fiscal deficit

MALAYSIA wants certainty and stability in the ringgit, Mustapa said.

Parliament reconvened this week following a scheduled break, with Najib facing the prospect of a noconfidence vote over political donations and the government’s handling of an investigation into state investment company 1Malaysia Development Bhd. The government aims to cut the fiscal deficit to 3.2 percent of GDP this year from 3.5 percent, after amending the target from 3 percent in January as Brent crude continued to slide. The 2016 shortfall

is expected to be announced at 3 percent in Friday’s budget, according to forecasts from ANZ, United Overseas Bank Ltd., Maybank and Affin Hwang Investment Bank Bhd. Najib may allocate 52 billion ringgit ($12.1 billion) to development expenditure in the budget, up from an estimated 48.5 billion ringgit this year, as infrastructure spending increases, Maybank and RHB Research Institute Sdn. predict. The budget will be “one of the most difficult,” the premier was quoted as saying in a New Straits Times report on Monday.

Malaysia’s five-year sovereign bonds rose, with the yield falling two basis points to 3.73 percent, prices from Bursa Malaysia show. The 10year yield was steady at 4.14 percent.

Bloomberg News

ASEAN

THE COMING OF SUPERBUGS

B2-1

2016 polls seen hurting infra growth

By Lorenz S. Marasigan

T

he 2016 national elections will likely derail the country’s infrastructure development due to policy conflicts, the BMI Research of Fitch Ratings said.

“We expect growth to moderate beyond 2015, as the elections would disrupt policy continuity. A change in leadership would also signal a review of current projects, which will lead to project delays,” the research agency said.

MEGAWORLD STEPS UP MCKINLEY WEST PROJECT

By VG Cabuag

P

ropert y developer Megaworld Corp. on Wednesday said it has accelerated the construction of six office buildings in the 34.5-hectare McKinley West township in Fort Bonifacio, Taguig City, to keep up with the robust demand.

The six towers will have a total of 60,000 square meters (sq m) of office space and will be part of the 350,000-sq-m office-space expansion of Megaworld in its entire Bonifacio property in the next three years.

“We are now experiencing an overwhelming demand for office spaces in our various townships, and a big chunk of the demand pie comes from Fort Bonifacio. In McKinley West, the demand is focused on campus-type buildings that have higher efficiency floor plates, easy access to office floors via internal staircases and branding

rights for whole building occupiers,” Jericho Go, the company senior vice president, said.

The ground level of each low-rise building will be devoted for commercial establishments.

President Aquino recently declared McKinley West as a special economic zone for information technology under the jurisdiction of the Philippine Economic Zone Authority (Peza).

As a special economic zone, certain privileges are granted by the national government to the business owners and investors operating inside the township, like incometax holidays, duty-free importation of capital equipment and other nonfiscal incentives.

Real-property taxes on land are paid by developers. “Businesses, especially in the information- technology and businessprocess outsourcing [BPO] sectors, can now avail of the incentives of a special economic zone when they lease an office

space from Peza-accredited buildings in McKinley West,” Go said.

These six office buildings could generate around 20,000 jobs once completed. The buildings will be certified under Leadership in Energy and Environment Design (LEED), a green building standard.

“Megaworld continues to attract more locators to set up or expand their businesses in the Philippines, especially after we built 8 Campus Place in McKinley Hill, which is the first LEED gold-certified BPO office building in the country. We look forward to our LEED certification for the new office towers in McKinley West, as well,” Go said.

Megaworld is the largest developer and lessor of office spaces in the country with over 700,000 sq m of office-space inventory, and around 300,000 sq m of the inventory are in the former military base.

See “2016 polls,” A2

Amnesty urges Asean govts to avoid repeat of Rohingya crisis

A

BusinessMirror media partner

mnesty International is urging Southeast Asian nations to avoid a repeat of the refugee-boat crisis that left thousands stranded at sea earlier this year, saying in a new report that human traffickers kept asylum-seekers in “hellish” conditions, beat them severely and even killed them if families failed to pay ransoms.

The report released on Wednesday is based

PESO exchange rates n US 46.1840

on interviews with more than 100 Rohingya Muslim refugees who reached Indonesia through perilous boat journeys.

“The daily physical abuse faced by Rohingya who were trapped on boats in the Bay of Bengal and Andaman Sea is almost too horrific to put into words.... Even children were not spared from these abuses,” said Anna Shea, a refugee researcher at Amnesty.

Tens of thousands of Rohingya have fled Myanmar by boat to escape persecution by the country’s Buddhist majority. Their plight became an international crisis in May when thousands of Rohingya and Bangladeshis were found packed in rickety boats with little food or water, abandoned by their smugglers.

Some were turned away by the governments of Thailand and Malaysia, while some managed

to make it to shore in Indonesia.

“The shocking truth is that those we spoke to are the ‘lucky’ ones who made it to shore— countless others perished at sea or were trafficked into forced labor situations,” Shea said.

The mostly Bengali-speaking ethnic Rohingya are Muslims who have lived in Myanmar’s western state of Rakhine as a minority See “Amnesty,” A2

n japan 0.3855 n UK 71.3358 n HK 5.9592 n CHINA 7.2744 n singapore 33.2283 n australia 33.5469 n EU 52.3911 n SAUDI arabia 12.3190

Source: BSP (21 October 2015)

A2

Thursday, October 22, 2015

News

BusinessMirror

Palace gives confusing tack on TPP. . .

Continued from A1

yet to be made public, it was reported that one of its provisions involve a so-called Investor-State Dispute Settlement (ISDS), where the government of a member-country can be sued by an investor, which could conflict with a key provision in the Philippine Constitution that the government cannot be sued without its consent.

At the same time, President Aquino’s Chief Spokesman Edwin Lacierda recalled that Mr. Aquino also affirmed the government’s commitment to join the TPP during an earlier interview with publisher Steve Forbes.

“We really want to participate in it. We were not the first group that was invited [to] it. We have been invited, in a sense, afterward,” Lacierda quoted President Aquino as telling Forbes during a one-on-one interview. Lacierda further recalled Mr. Aquino asserting that “America continues to be one of our biggest trading partners.”

“No. 3 currently in terms of trade,” President Aquino noted. “The bottom line is: We are used to dealing with you. The rules seem to be very clear. Everybody would want to have an increase in their potential market.

So why not deal where there is stability in the relationship, where, again, you can expect the assumptions are valid, rather than going somewhere where the gains are potentially very large, but at the same time, the risks are undetermined, or unknowable.

So joining TPP does make very good sense to us, especially because of those already in it who we find ourselves in very close alliances [in] so many different fronts. Japan comes to mind.

Vietnam comes to mind. And other countries.”

President Aquino added.

Trade Undersecretary Adrian S. Cristobal

Jr. said Manila is aiming to complete technical consultations with all 12 members of the TPP by next year to make sure the Philippines will remain at the doorstep of the US-led trade bloc once it starts accepting new members.

“The Philippines has indicated very clearly that we would like to join the TPP and would want to start discussions for our entry once it opens its doors to new members. Even before the TPP was concluded, the Philippine government had already undertaken technical consultations with six of the 12 TPP countries, and the talks will continue,” Cristobal said.

The Philippines had previously conducted technical discussions with Malaysia, the US, New Zealand, Australia, Mexico and Canada. It will soon initiate the same with Japan, Peru, Chile, Singapore, Brunei Darussalam and Vietnam.

Cristobal said these technical consultations would be carried out next year. The technical consultations, he said, are meant to get an idea of the commitments that the expansive and highly secretive deal would demand from the Philippines and other countries that are seeking to join the TPP. Some of the more controversial sections of the deal centered on intellectual propertyrights protection for pharmaceutical products, as well as the ISDS mechanism. The Philippines, for failing to gain entry into the TPP before negotiations were closed to new members, will be faced with a take-itor-leave-it scenario.

The country’s constitutional limits to foreign investments and practice of profession, among others, have been acknowledged by the Department of Trade and Industry (DTI) as problematic areas in the country’s TPP bid.

Given the Philippines’s constitutional limitations and the secrecy surrounding the text of the TPP, the country needs to carefully study the commitments that it needs to make as part of the deal, Cristobal said.

“Before we enter formal discussions for membership in the TPP, we will carefully review the final and full text of the agreement, evaluate its impact on the economy and consult thoroughly with our various stakeholders,” Cristobal explained.

Cristobal, however, emphasized that while the country is not yet a member of the TPP, Philippine products already enjoy favorable market access to the US, the deal’s main proponent. About 70 percent of Philippine exports enter the US market duty-free, through zero tariffs under the Most Favored Nation status or through the Generalized System of Preference scheme.

The TPP is a landmark agreement that eliminates or reduces tariffs, lowers the cost of trade, and sets new and high standards for global trade, while addressing nextgeneration issues. The TPP is envisioned to promote economic growth, create jobs, raise living standards, reduce poverty, promote good governance, and enhance labor and environmental protections among its member-countries.

The 12 TPP members—Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, the US and Vietnam—announced the conclusion of their negotiations last week. These countries have a combined population of 800 million and are projected to account for 40 percent of the global GDP and 30 percent of world trade.

news@businessmirror.com.ph

2016 polls. . .

Continued from A1

It will, likewise, be limited by the recent ruling of the Supreme Court against the Disbursement Acceleration Program (DAP) of Mr. Aquino.

“The Supreme Court’s ruling on some of the acts under the Disbursement Acceleration Program as unconstitutional, will also limit spending on infrastructure by public agencies,” BMI Research said.

The High Court, in February, upheld the unconstitutionality of several acts under DAP, particularly the “withdrawal of unobligated allotments from the implementing agencies, and the declaration of the withdrawn unobligated allotments and unreleased appropriations as savings,” and the “cross-border transfer of savings.”

However, the decline in infrastructure spending will be tempered by the acceleration of the public-private partnership (PPP) initiative of the Aquino administration.

“Public construction would be supported by an acceleration of the PPP Program, as President Aquino looks to approve more projects before the upcoming elections in 2016,” the Fitch-led research body said.

Based on the latest data from the PPP Center, around 12 PPP projects worth P284.98 billion are

Amnesty. . .

now under implementation.

This includes the 10 projects worth P189.02 billion that have been awarded to private firms and two other projects worth P95.96 billion that are also for implementation.

The main pipeline, or the list of projects that have not been awarded, includes 40 projects worth P811.71 billion This includes 14 projects worth P518.28 billion that are under procurement and 12 projects worth at least P67.45 billion with ongoing studies and procurement of consultants for preinvestment studies. The list also includes two projects worth P24.79 billion that are for roll-out or bidding.

“Strong growth in the Philippine construction sector will be supported by the private sector, with residential building activity supported by a relatively stable monetary policy. Public construction will also pick up, as President Aquino looks to accelerate projects under the public-private partnership program before ending his single-term as president in 2016,” the BMI Research said.

By year-end, the construction sector should have registered a 10.9-percent growth.

Continued from A1

for generations, but are not recognized by the government as citizens. Instead, they are branded as foreigners with no rights, and face constant discrimination from the government, as well as Buddhist nationalists. Clashes between the two communities have left more than 200 dead, mostly Rohingya. Another 140,000 were driven from their homes

by Buddhist mobs. Displaced Rohingya who have not fled the country live in squalid camps.

With the monsoon ending and a new “sailing season” already under way, thousands more Rohingya could be taking to boats, Amnesty said, as it urged regional governments to urgently step up their response.

“Without cooperation between governments to combat human trafficking, grave human-rights abuses will again be perpetrated against some of Southeast Asia’s most vulnerable and desperate people,” Shea said.

The United Nations estimates at least 370 Rohingya died between January and June while trying to flee by boats. Amnesty International says the number is much higher, based on eyewitness accounts of dozens of large refugee boats that set out from Rakhine state, but only five boats that landed in Indonesia and Malaysia.

Hundreds, if not thousands, of people remain unaccounted for, and may have died during their journeys or been sold for forced labor, the report said. AP

The Nation BusinessMirror

news@businessmirror.com.ph

Lao PDR sets Vientiane Expo 2015

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HE Ministry of Industry and Commerce of the Lao People’s Democratic Republic has announced the holding of the Vientiane Expo 2015 at Lao International Trade Exhibition and Convention Center from November 28 to December 7.

It will be the first time for the country to hold a trade exhibit. Other countries have been invited to display their products at the expo.

The Vientiane Expo 2015 will mark the celebration of the 40th anniversary of Lao National Day and will showcase the country’s outstanding national and regional products, such as agriculturebased products, processed foods, furniture and furnishings, handicraft and jewelry, consumer goods, machinery, equipment and electric appliances. Diverse offerings from its service sectors and others will also be on display at the event.

The event will also be a platform for local and regional businesses and entrepreneurs to build business connections and business matching.

It is expected that more than 500 booths from hundreds of companies from Laos and other countries will display their products during the expo.

Editor: Dionisio L. Pelayo • Thursday, October 22, 2015 A3

Ombudsman files graft charges vs police officials in AK-47 case

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By Jovee Marie N. dela Cruz

HE Ombudsman has ordered the filing of charges before the Sandiganbayan against several ranking National Police officials and personnel for their alleged involvement in the anomalous issuance of firearm licenses for AK-47 rifles in 2013.

Ombudsman Conchita CarpioMorales ordered the filing of graft charges against Director Gil Meneses of the Civil Security Group; Director Napoleon Estilles of the Firearms and Explosives Office; Chief Supt.

Raul Petrasanta; Chief Supt. Tomas Rentoy III; Chief Supt. Regino Catiis; Senior Supt. Eduardo Acierto; Senior Supt. Allan Parreño; Supt. Nelson Bautista; Chief Insp. Ricardo Zapata Jr., Chief Insp. Ricky Sumalde; Senior Police Officer (SPO) 1 Eric Tan; SPO1 Randy de Sesto; Non-uniformed Personnel Nora Pirote and Sol Bargan;

MORALES: “The public respondents failed to act in accordance with their respective duties in processing the questioned firearms license applications and that their acts or omissions demonstrate that they are guilty of gross inexcusable negligence and evident bad faith.”

and Isidro Lozada of Caraga Security Agency (Caraga).

“Respondents were found to have conspired in facilitating, processing and approving the applications for firearm licenses of Caraga, Isla Security Agency [Isla], Claver Mineral Development Corp. and JTC Mineral Mining Corp. despite incomplete or falsified applications and supporting documents,” Morales said.

She added that most of the firearms were also released immediately even when some of the requests for their withdrawal from storage were not signed by the requester.

Morales said that her investigators discovered the following irregularities: issuance of firearms licenses to Caraga despite an expired license to operate; processing of Caraga’s applications without verifying the number of firearms already issued to it, which resulted in the issuance of licenses beyond the limit allowed by regulation; recommendations for approval of the firearm licenses without proper verification and checking; Meneses’s handwritten notations to expedite processing; and the absence of verification of the identity and

capacity of Isla to purchase highpowered firearms.

“The public respondents failed to act in accordance with their respective duties in processing the questioned firearms license applications and that their acts or omissions demonstrate that they are guilty of gross inexcusable negligence and evident bad faith,” she said.

Republic Act 3019 of the Antigraft and Corrupt Practices Acts prohibits public officials from causing any undue injury to any party, or giving any private party any unwarranted benefits, advantage or preference in the discharge of official administrative or judicial functions through manifest partiality, evident bad faith or gross inexcusable negligence.

In addition, the law prohibits public officials from knowingly approving or granting any license, permit, privilege or benefit in favor of any person not qualified for or not legally entitled to such license, permit, privilege or advantage, or of a mere representative or dummy of one who is not so qualified or entitled.

SC approves prosecution of PEA execs

By Joel R. San Juan

T

HE Supreme Court (SC) has approved the prosecution for graft of several officers and members of the Public Estates Authority (PEA) board of directors for their role in the allegedly overpriced construction of President Diosdado Macapagal Boulevard in 2002.

The SC held that the Ombudsman’s finding of probable cause to charge PEA officials of graft was not issued with grave abuse of discretion.

Thus, the SC dismissed the petition filed by Victor Lacson, Raphael Pocholo Zorilla, Cristina Amposta-Mortel, Manuel Berina Jr., Jaime Millan, Bernardo Viray, Frisco Francisco San Juan, Carmelita de Leon-Chan, Daniel Dayan, Salvador Malbarosa, Leo Padilla, Elpidio Damaso, and several others seeking the reversal of the Ombudsman’s findings.

The SC also affirmed the resolutions of the Sandiganbayan denying the accused’s motion to quash the graft information filed by the Ombudsman and its resolution denying their appeal.

TheBroa

Business

A4 Thursday, October 22, 2015

Expecting sustaine sans ample support E

very $1 spent for export promotions could yield $300 in incremental sales. This is the pitch that the public-private Export Development Council (EDC) used to convince Malacañang and Congress to increase the promotions budget for the export sector.

Trade Promotion Activities (January to August 2015) Type of Activities

No. of Activities

Export sales (In $ millions)

Companies assisted

Inquiries/Buyers

Signature Events

4

28

584

8,802

Overseas Trade Fair

19

184

349

12,623

Offshore Business Matching

12

6

122

63

Inbound Business Matching

22

8

206

53

Total

57

226

1,261

21,541

Every $1 spent for export promotions could yield $300 in incremental sales. This is a simple equation that has also driven other countries to ramp up their promotional activities for their exporters. But, perhaps due to plain naïveté, the Philippine government is still not taking this route.

Perlada

Department of Trade and Industry’s Export Marketing Bureau (DTI-EMB) Director Senen M. Perlada said this is a simple equation that has also driven other countries to ramp up their promotional activities for their exporters.

But, perhaps due to plain naïveté, the Philippine government is still not taking this route.

So despite the significant strides made by the DTI in promoting Philippine exports abroad, it is still saddled with a considerable hurdle that will hinder locally made goods from penetrating key export markets-lack of budget.

Even with the gradually declining export receipts this year due to instability in the global market, the sector remains a significant contributor to the local economy. In 2014, for instance, export earnings reached $62.1 billion—an all-time high—ref lecting a 10 -percent growth from $56.7 billion in 2013.

With the significant contribution of exports to the local economy in mind, the government and the private sector came up with the three-year Philippine Export Development Plan (PEDP).

The 2014-2016 PEDP is the export-sector component of the Philippine Development Plan 20112016, the government’s primary economic and social development blueprint.

It outlines the export targets and market strategies seen to boost export growth within the three-year period, taking into consideration the problems affecting local and international markets.

Philippine Exporters Confederation Inc. (PhilExport) President Sergio R. Ortiz-Luis Jr., in a previous interview, stressed that a salient point of the PEDP is the export-development fund (EDF), a P1.8-billion allocation from the national government meant to

be distributed to the promotions group of the DTI and other promotion units of other agencies.

T h e PE DP, s u b m it t e d t o Malacañang in December last year, is yet to be signed by the Chief Executive up to now, to the dismay of exporters hoping that the fund could be injected into the national budget by 2016.

Perlada acknowledged that both the government and private sectors see the need for increased support for export competitiveness.

“From the P1.8-billion EDF that was proposed in the PEDP for promotional and marketing assistance across different agencies and not just EMB, we asked for P600 million. That would, hopefully, cover 2015 to 2017. That has been endorsed by Secretary [Gregory L.] Domingo and submitted to Malacañang; but we have no word yet on it,” Perlada said in a recent BM Coffee Club forum.

On the EDF, Perlada noted that the focus of the fund is the creation of the National Quality Infrastructure (NQI), an institutional framework, encompassing both private and public sectors, that formulates, issues and implements standards and sets compliance assessment to improve the suitability of products, processes and services.

The P600 million will be allocated for the creation and implementation of the NQI, distributed among the bureaus involved, such as the Department of Science and Technology and Bureau of Product Standards.

“We’re going heavy on the NQI in the PEDP because we have to strengthen the quality; that’s what we have to improve on,” Perlada added.

For the EMB alone, Perlada conceded that his bureau has been receiving, at most, P42 million for maintenance and other operating expenses, not counting

personnel services.

The paltry allocation compels the office to seek support from development partners and other bureaus tasked with marketing assistance for exporters, such as the Department of Agriculture’s Marketing Assistance office.

The minuscule budget may also be the cause of the small base of Filipino exporters that are actively trading, the EMB director added.

To date, the EMB has profiled and engaged 1,250 exporters. The total base of regular exporters is around 6,000.

This is a trifle number compared to Thailand, which has a Cabinetlevel agency dealing with export promotions, and which has a total regular exporter base of over 10,000, Perlada added.

“The EMB of Thailand is one department; Cabinet level and reporting directly to the prime minister.

We could do more; but right now, we’re just doing what we can,” the DTI official said.

This is significant as the EMB director cited an earlier World Bank study citing the multiplier effect of export promotions on export receipts.

“Across all levels of development, a dollar spent, depending upon the sector promoted, the return is around $ 300 in incremental export sales,” Perlada said.

Incorporating that principle in the PEDP, the EMB official said the P1.8-billion fund, in dollars, only represented 2 percent of the incremental exports they are targeting in the plan.

Market penetration has also been affected by this dearth in financial support.

For instance, the Philippines, Perlada noted, has failed to seize the first-mover advantage in the

export of nata de coco in Japan, its largest export market.

“We missed the boat in the sense that there was not enough unity in communicating what the market really wanted or needed. Those were there that took advantage took shortcuts. Our exporters need to know that we should follow the standards,” Perlada added.

“The problem is where they will source the fund. The Neda [National Economic and Development Authority] is now taking a closer look at it, probably a cost-benefit analysis of the plan,” he said.

Even with a shoestring budget, the International Promotions Group of the DTI, the umbrella group of EMB, has sustained its marketing, promotion and information efforts.

As reported in the Philippine Economic briefing, the DTI conducted 179 Doing Business in Free Trade Ar-

eas (DBFTA) sessions from January to August this year, already surpassing the goal of 175 sessions. These were attended by 15,615 participants from 5,148 companies, of which 963 were exporters.

The DBFTA are information sessions for small and medium exporters on how to take advantage and use the existing free-trade agreements of the country in exporting their products.

Last year the DTI also conducted 26 Philippine Export Competitiveness Program (PECP) seminars, with attendees counting 1,576.

The PECP is a series of information seminars designed to encourage local companies to join trade fairs and ramp up their product competitiveness.

From January to August, the DTI conducted 21 PECP seminars attended by 1,754 participants. In that period, the export-promotion

aderLook

sMirror

www.businessmirror.com.ph | Thursday, October 22, 2015

A5

ed exports growth t is plain stupidity

activities were: For the last quarter of 2015, the EMB will be setting an outbound export-promotion mission to the Middle East, targeting Jordan, Qatar, the United Arab Emirates and Saudi Arabia, with Philippine companies pushing food, fast-moving consumer goods and personal-care products.

While the EMB is not giving up hope on the approval of the EDF under the export plan, Perlada said the allocated agency budget will have to do—for now.

But the shelving of the EDF may be another hindrance to the already sluggish export performance of the country, mainly brought about by the diminishing demand from China and Japan.

The Philippines’s export sales totaled $5.1 billion in August, a 6.3-percent decrease from $5.4 billion recorded value in August of 2014.

The DTI has already conceded that a 10-percent growth in exports—the government-set target—is already unlikely this year, seeing a 3-percent to 5-percent growth instead.

A6 Thursday, October 22, 2015 • Editor: Angel R. Calso

Opinion BusinessMirror

editorial

Typhoon Lando and the Bonn climate forum

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S Typhoon Lando (international code name Koppu) mercilessly battered northern Luzon on Monday, a crucial climate conference commenced in Bonn, Germany. Members of the Ad Hoc Working Group on the Durban Platform, where countries negotiate about a climate agreement before the 21st Conference of Parties (COP) in Paris in December, started to wrap up negotiations to find effective ways to stop global warming.

The COP is a yearly meeting of countries under the United Nations Framework Convention on Climate Change that hopes to solve the climate crisis. The result of the last five days of negotiations in Bonn is very important as it will set the tone of whether Paris will be a success. The negotiations will either set a strong foundation or a shaky ground for a new climate agreement.

In the last few years, a number of catastrophic events have happened because of climate change: Severe drought in California and elsewhere; destructive super typhoons like Yolanda (international code name Haiyan) in the Philippines; extreme heat in India; and extreme rains and floods in many parts of the world. Hopefully, these will serve as warning signs for world leaders to start acting on climate change. A legally binding deal in Paris will be crucial to mitigate the damage that extreme weather events could inflict on vulnerable countries like the Philippines.

As climate negotiators in Bonn are busy debating over the appropriate words to use in the agreement, Filipinos up north are agonizing over the loss of people’s lives, properties and crops. As we go to press, Lando’s death toll has risen to 30, and damage to agriculture was estimated at P6 billion.

That Lando came to ravage the Philippines on the day that a global climate forum was convened in Bonn serves as a grim reminder for world leaders. It should remind them that the deadliest Philippine typhoon—Yolanda—recorded in modern history, killing at least 6,300 people, happened during the COP Warsaw negotiations in 2013.

Yolanda’s fury prompted former climate-change commissioner and negotiator Naderev Saño to take the floor and deliver an impassioned speech in Warsaw: “We can take drastic action now to ensure that we prevent a future where super typhoons are a way of life. Because we refuse, as a nation, to accept a future where super typhoons like Haiyan become a fact of life,” Saño said.

Indeed, the whole world refuses to accept a future where super typhoons become a fact of life. Climate disasters like Yolanda are grim reminders that we are all responsible for the planet’s destruction and environmental degradation, and we are probably approaching the point of no return. We have to change our ways, and we have to change them now. For our climate negotiators, they must move faster than the sea-level rise. Otherwise, we will continue to suffer the consequences of longer and more severe droughts and other extreme weather conditions that will bring heavier loss and greater damage all over the world.

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10222015

Times are changing John Mangun

OUTSIDE THE BOX

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ne aspect of the changing trend of the Economic Confidence Model (ECM) is the political predictions for 2016. As in the change of the seasons, whether autumn to winter in the north or wet to dry in the tropics, there are forerunners before the big changes occur.

We are now seeing the precursors of the 2016 political change. In the last 30 days, both Australia and, most recently, Canada have changed leaders. For Canada, the government will now be more “left-wing” from a former “right-wing” government.

Australia’s new prime minister, although saying he had no intention of making any immediate changes, has historically been a strong advocate of “Australian republicanism.”

Few people know that the Australian Head of State is actually the Queen of England. The prime minister is only the head of government.

The installation of both of these new leaders marks a reversal of current policy and direction. Further, the ECM forecasts a larger than average voter turnout for elections in 2016. For example, the recent election in Canada showed voter turnout at 68.5 percent, the highest level since 1993.

Canada and Australia are actually minor countries in the overall

scheme of things. They may be large in size but are small in population, and are both dwarfed in influence by their combined regional neighbors.

Further, their economies are both natural-resource export based and, therefore, are not global economic drivers but only benefit from global economic growth.

The ECM predicts that 2016 will see a massive change from the current political leadership to either opposing political views or complete outsiders.

The Democrat Party nomination for US president in 2016 was supposed to be merely a guaranteed “coronation” for Hillary Clinton and it may still well be. However, Clinton is being strongly challenged by a sitting US senator who is not even a member of the Democrat Party but has been repeatedly elected as an “Independent.”

The Republican Party race is now led by businessman Donald Trump and retired neurosurgeon Ben

Carson, neither of whom has ever run for or held political office and who together command just under 50 percent of the total potential Republican voter preference. This is a huge development in US politics, which is known for its final presidential candidates always being part of the political elite or chosen by those elite.

What the turning of the ECM means for Philippine politics is hard to say at this point as the candidates are all experienced political officeholders or have been selected by the political establishment.

However, the ECM is obviously not only about economic changes, as the ECM embodies and is surrounded by other cycles, including the Cycle of Wars and the political cycle of which I spoke. The key to the deal is change, from confident trust in what has been to a lack of trust in the status quo—existing state of affairs—and a change to something different, maybe even the complete opposite.

The last eight weeks of trading on the Philippine Stock Exchange have been unlike anything seen since 2006. After a massive drop and then a massive price recovery in the same week, stocks have been locked in relatively narrow range, not wanting to break out in either direction. Even a nearly similar fall in September 2014 was followed by a complete recovery (before going down again) within a month.

This situation has traditional Philippine stock brokers, unbiased

Ted Cruz’s leap into the unknown

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By Jonathan Bernstein | Bloomberg View

eorge W. Bush reportedly took a shot at Ted Cruz in a closed-door fund-raiser on Sunday, telling donors, “I just don’t like that guy.” He didn’t express strong feelings against his brother’s other primary opponents, including Donald Trump.

Perhaps, it was just campaign-strategy talk, but don’t you think he meant it?

His candid comment helps explain why Cruz probably won’t be the Republican nominee: Important people within the party just don’t like him.

Of the 22 announced candidates for president in the 2016 cycle (in both parties) and the additional half-dozen or so, who ran and dropped out before announcing, Cruz is the only one who has had me second-guessing myself. I’ve said Cruz isn’t a plausible nominee, and I’ll stick with that. But while I’m confident that Trump, Ben Carson, Bernie Sanders and others just can’t win, I’m less certain about Cruz.

He passes, if not by much, the basic nominee test. He has conventional qualifications for the office— a little skimpy as a first-term senator elected in 2012 with no prior experience in elective office, but his other government jobs make him at least comparable to Barack Obama in 2008. And his views on the issues are within the mainstream of his party. Harry Enten over at 538 made a pretty good case for Cruz last week. He’s good at appealing to Republican voters. If factional candidates with great public skills won presidential nominations, then Cruz would make plenty of sense.

But presidential elections since the 1980s have typically been won by coalition-style candidates. Cruz has managed to make enemies of practically every one of the other 99 US senators, plus a large swath of the House, including the Republican leadership. You could point out, as I have in the past, that support in Congress has always been overrated when it comes to getting presidential nominations.

But it’s one thing when congressional colleagues don’t especially support a candidate (as was the case with John Kennedy in 1960); it might be another when they actively dislike someone.

Cruz’s major accomplishment during his short career in the Senate was the October 2013 government shutdown, which was widely seen as a disaster for the Republicans. If party actors choose the nominee, then the opposition of the politicians in federal office (and presumably the governing

market analysts and “wannabe experts” pounding their heads against the wall, totally confused and trying to figure out what is going on. It is no different than the political experts in the US trying to figure out what is happening in their highly scientific but failing election scenarios. Likewise, Europe and the US are trying to figure out how Vladimir Putin and Russia just took over military and political leadership in the Middle East. That was not supposed to happen either.

The turning points on the ECM have been accurate for hundreds of years; but who cares. What we need to care about, for example, is that its sub-cycle—the “Real Estate Business Cycle”—called almost to the exact day of the peak when the subprime realestate mortgage market exploded.

Major ECM changes have rarely been pretty and have always created great disappointment with what we thought was reliable analysis and opinion across all disciplines. If the lack of accuracy of many local stockbroker recommendations—both buy and sell—over the last three months is any indication, to quote American songwriter Bob Dylan, “The times they are a-changin’” in our stock market.

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.

professionals who work for them) seems like an important negative.

Why would even his own faction within the party support someone with a record of strategic and tactical blunders?

A normally functioning party would go nowhere near Cruz. It would choose one of the several other candidates who have the same positions on policy and have better reputations. But are the Republicans a normally functioning party? Given how the Republicans have treated their own leadership in the House of Representatives, it’s hard to know.

If I’m wrong about Trump, Carson and Sanders, then everything other political scientists and I believe about the presidential nomination process—that parties choose—is likely wrong. But if I’m wrong about Cruz, it will be because I didn’t fully appreciate how messed up the Republican Party has become.

Opinion BusinessMirror

opinion@businessmirror.com.ph

Thursday, October 22, 2015

CSR: From philanthropy Called out of darkness into the light to real social change Msgr. Sabino A. Vengco Jr.

Alálaong Bagá

Ariel Nepomuceno

DECISION TIME

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enowned economist Milton Friedman would never have imagined that acceptable returns on shareholders’ investment would remain to be the only measure for assessing a corporation’s success because for him there is only one responsibility of business—to utilize its resources and perform activities designed to boost profits so long as it follows the rules of the market without fraud or deceit.

But current geopolitical and business complexities and the radical change in regulatory policies of countries all over the world now encourage and sometimes require corporations to take an active role in social reform and action. These realities have changed the traditional landscape for businesses and the way they operate. Societal demands have increased the pressure for the Board of Directors of companies to move from a purist “rights and duties” role to one of good governance.

Larger role in society And part of governance is confronting the escalating impact of environmental, social and political issues associated with a company’s daily activities. Companies are now increasingly conscious about the impacts of their operations—pollution, climate change, unfair labor conditions, hunger, political unrest and human rights. Since the demand of different stakeholders for more socially responsible operations are relentlessly growing, companies are left with no choice but to accept and integrate these concerns into their practices. Benchmarks and internal systems have been developed to assess performance on the basis of the aforementioned impacts. All of these initiatives are now described in one term— “corporate social responsibility” or CSR.

Good for the bottom line The positive correlationship between good financial performance and CSR is now becoming clearer more than ever. In fact, many economic researches reveal that financial markets are rewarding or punishing companies based on their perceived social performance. Companies are realizing that there may be temporary trade offs between CSR goals and profitability, but on a long-term basis, there are greater opportunities for competitive mileage from establishing a social value dimension into typical corporate strategy. CSR initiatives enhance shareholder value by compelling companies to properly manage the risks, evaluate new markets, monitor and anticipate governmental and regulatory action while contributing to the developmental and welfare needs of the societies where they operate. In sum, CSR attracts more investors, the right employees, improves the company’s

brand, leads to a positive reputation and pushes overall market performance.

CSR abuses But not everyone is impressed with companies and their present “fixation” with CSR. Some financial analysts and critics dismiss CSR as nothing more than a convenient public relations strategy.

Others argue that CSR is a mere ‘‘window dressing,” “greenwash” and a pathetic attempt of companies to shirk from their legal responsibility by showing acts of corporate kindness and benevolence to hide the truth behind their misdeeds.

Certain non-governmental organizations and cause-oriented groups have, likewise, shared their view of CSR as an effective preemptive move of companies to stop governments from acting as watchdogs over their activities. In fact, ethical compliance stakeholders observed that in many instances, CSR is even being used as a vehicle for graft and corruption in the area of charitable donations and social performance endeavors. Donations are being given left and right to social organizations that are chaired or managed by government officials, their relatives or minions. CSR has become a political accommodation.

Way forward These criticisms must be taken very seriously if companies are genuinely concerned with doing good. Process and governance-wise, companies must rigorously develop their respective assurance frameworks where there are common parameters to measure CSR goals, simple processes in place to achieve benchmarks, internal auditing and probably, a system where these goals can be externally verified by independent and reputable accredited bodies.

With CSR continuing to be a critical business issue, it is to be expected that companies shall face the challenge of proving to their investors, employees, customers and the general public that they strive to create value for both their shareholders and society in general.

Striking that delicate balance is key.

From philanthropy to being a real vehicle for social and economic change, this should direct how a company’s CSR platform should be measured. After all, there is always a large room in the marketplace for responsible and ethical firms.

Trudeau’s ambition meets Canada’s faltering economy

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anada wants change. Voters have pushed Stephen Harper’s Conservatives out and, for the first time since the election of 2000, have given the centrist Liberal Party, led by Justin Trudeau, a parliamentary majority. It’s a surprisingly big win that puts pressure on the Liberals to deliver.

This won’t be easy. Trudeau has promised a program of reform that’s comprehensive to a fault—touching on everything from legalizing marijuana to restoring “funding for Canada’s four heavy urban search and rescue teams.”

But these expansive ambitions will have to contend with an unhelpful economy.

During the election campaign, Harper mocked the youthful Trudeau as unready to govern. The tactic failed, but the charge will be remembered if the economy worsens.

Canada came through the global economic crisis that began in 2008 relatively unscathed. Its banks were strong and domestic demand didn’t falter. These advantages can no longer be taken for granted. Slow global growth and the collapse in energy prices have ended

Canada’s impressive run. With Canadians tired of austerity and looking for fast answers, the country stands at a dangerous juncture.

Slumping global commodity prices have hurt Canada’s main export business. The economy shrank in the first two quarters of 2015. And in its new global economic forecasts, the International Monetary Fund has cut its growth projections for Canada more sharply than for any other major economy. It now expects Canada to grow only 1 percent this year.

The Liberals hope to address this partly by increasing public investment and relaxing efforts to contain public borrowing. This approach is defensible—with interest rates so low, borrowing is cheap—but Trudeau must move cautiously. A program that scares financial markets might easily push interest rates up. Canadians own houses with dangerously inflated valuations and have borrowed too much. With household debt standing at more than 160 percent of income, the economy is unusually vulnerable to interest-rate surprises. TNS

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E are filled with joy because the Lord has done great things for us and will again help us (Psalm 126: 1-2, 2-3, 4-5, 6). Jesus freed the blind from darkness, and the man could see and followed Jesus (Mark 10:46-52).

Sowing in tears, reaping in joy The memory of God’s past interventions on behalf of His people now give them hope and confidence that God will again help them. He cared for them before as seen in the great blessing of the exiles’ return to Zion, when those vanished unbelievably found themselves on the way back to the land of their origin. They were then in total amazement, filled with laughter and overflowing with joy at their incredible good fortune.

And the other nations could not but take note of God’s saving power, awestruck at the wonderful things He has done for His people. The people themselves knew that their God has preferential love for the poor and the oppressed, the homeless and the refugees.

So, now in their present predicament the people of God pray for deliverance. They know their situation to be impossible and only God can help them. It would be like having flood in the southern desert, a very arid place where having torrents of

water is just not possible. The contradiction and the implausibility of what is asked for is tantamount to a reversal of fortune like “sowing in tears and reaping in joy” and setting forth with only the promise of harvest and returning home with abundant fruits, replacing their tragedy with good fortune. It is their prayer; it is what they hope for. They are confident because God has always been gracious to them.

Have pity on me

A blind beggar sitting by the roadside outside Jericho heard from the crowds that it was Jesus of Nazareth passing by with His followers.

The man, Bartimaeus, was not just any beggar lining the road leading out of the city, at least afterward, because he was called by name by the narrator; he must have become later a well-known follower of Jesus.

In his situation of enveloping darkness that rendered him helpless to do anything else for a living, Bartimaeus had been reduced to begging

from people walking by. His hope was awakened upon learning that Jesus was in his vicinity.

He immediately sought to connect with Jesus, crying out loud his name. He could not contact Jesus by his eye-sight, but he still had his voice with which to reach out. And blindly he cried for help, flinging out the name “Jesus, son of David”; the name of Jesus came out of his lips propelled by his desperate need but also by some faith that the man could be the promised and longawaited one from the line of David to fulfill the people’s expectations and common dreams. Bartimaeus literally stood out from the masses as he begged Jesus for pity and mercy.

From his particular condition and personal “perspective” he hoped Jesus would extend to him some relief and compassion.

I want to see

Bartimaeus had his imagination working for him that Jesus somehow represent to persons like him divine mercy when everything else has failed. And hope awakened in what, otherwise, would be a hopeless condition could not accept caving in to others’ suggestion and interpretation that one is so deep in the pit of darkness there can be no light at all to expect. But Bartimaeus would not be silenced from confidently calling out the name of Jesus by people who were rebuking him and thought his concerns could not possibly deserve the attention of the son of David.

Presuming Bartimaeus to be

A7

wrong in his misplaced confidence, the people telling him to quiet down and cool it were proven wrong. Jesus called back to have Bartimaeus brought to Him. And it was almost funny that now the people were telling Bartimaeus to have courage and go to Jesus who was calling for him.

Asked by Jesus what he wanted that He should do for him, Bartimaeus outright and without hesitation begged of Him that he wanted to see. And he immediately received his sight, and he saw Jesus. And Bartimaeus saw more; he saw in Jesus his calling.

Alálaong bagá, Bartimaeus believed and hoped that Jesus was the answer to his dream of wholeness, the giver of light in his life of darkness. And he was proven correct in his trust and confidence. When other people did not think so, he persisted and won the tremendous gift of having someone he could call “Master”, someone to follow in life. Bartimaeus upon hearing that Jesus was calling for him sprang up and threw aside his cloak, leaving behind whatever he might have collected already from others’ donations, and went completely for Jesus and followed Him, from a life of segregating darkness, on the way to the fullness of union with God in community with others through faith in Jesus.

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.

Maybe UK social class isn’t a frozen zone

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By Therese Raphael | Bloomberg View

hether on policy or sartorial choices, the leaders of Britain’s Conservative government and its opposition Labor Party could not be farther apart. Yet, there is strong cross-party consensus around the view that social mobility is too low in Britain. Ironically, both parties may be wrong; or at least guilty of oversimplifying.

Prime Minister David Cameron, like every politician in his shoes since Tony Blair, has made tackling the problem a major goal of social policy. “Britain has the lowest social mobility in the developed world,” Cameron told party faithful at their annual conference recently. People, he said, are unable to “rise from the bottom to the top, or even from the middle to the top, because of their background.”

It’s not simply a matter of social justice. Some academics have suggested that as many as 4 percentage points of GDP could be added annually if Britain could improve mobility.

But those who study social mobility say that debates over definitions and data leave more doubt than the popular view would suggest. That makes it hard for leaders like Cameron to go where the data takes them.

The original consensus that Britain is a society where mobility is low and getting worse grew out of a study in the early 2000s that examined two cohorts of children, one born during a particular week in 1958 and the other in 1970.

Funded by the Sutton Trust, a charity set up to tackle social mobility through education, it found that the second group’s adult income more closely resembled that of their families.

The authors argued that this apparent decline in income mobility was associated with widening inequality in Britain after the late 1970s.

Labor seized on the study to argue that the class system in Britain had ossified under Margaret Thatcher’s Conservatives. Conservatives also found the study handy because continued low social mobility shone a spotlight on Labor’s failings despite a great deal of tinkering with education.

The academic literature since then has multiplied, but it hasn’t necessa r i ly broug ht c l a r it y.

John Goldthorpe, a University of

Oxford scholar of the issue, says one of the problems lies in poor data sets used in most studies, and analysis that conflates absolute and relative changes.

Absolute mobility addresses the extent to which, say, offspring earnings are greater in real terms than their parents’ earnings. Relative mobility measures the chance that offspring from different class backgrounds will arrive at new class destinations.

Both are important, though a focus on one might lead to policies aimed at alleviating poverty while other points to those that expand equality of opportunity.

A follow-up to the original cohort study that established the consensus of low and declining mobility in the UK, published by the same authors in late 2007, found that whatever the cause of the early findings, immobility had seemed to taper off since. Maybe mobility had not improved, but it had not grown worse.

The Prime Minister’s press office says his conference remarks on social mobility were largely based on a 2010 Organization for Economic Co-operation and Development (OECD) study, which compiled data from various sources to arrive at a cross-national comparison. It included a measurement (above) of the degree to which a son’s earnings reflect those of his father.

It too must be taken with a degree of skepticism. The OECD study drew from a limited country selection with strong representation from Scandinavian countries where social spending is high. More problematic, according to at least one critic, is that the data sets were collected by different bodies, using different statistical methodologies, which makes cross-national comparisons suspect and may have lead to exaggerated results for the UK. In a 2014 analysis of the link between family background and wage and employment rates, John Jerrim at the University of London used

three comparable data sets from over 30 countries and found no statistically significant differences between the UK and other countries.

Other indicators in Britain may actually be improving. The proportion of low-birth-weight babies (strongly linked to social background) has dropped. The gap in school readiness between children poor enough to qualify for free school meals and other pupils has narrowed. While 81.6 percent of general pupils achieve a reasonable level of attainment at 11 years old, only 63.6 percent of those eligible for school meals do; but that is about 7 percentage points better than the gap in 2005.

“In sum, the implications of different degrees of income mobility in a society, and, hence, also the appropriate trade-off between poverty and inequality on the one hand and mobility on the other hand, are not clear cut,” wrote Prof. Stephen Jenkins of the London School of Economics in his 2011 book, Changing Fortunes.

This is no reason to stop worrying about poverty, inequality or social mobility. It is clear that well-off, educated parents confer big advantages on their children in Britain, as in the US. In fact, children of more advantaged parents who score in the bottom quartile of testing at 22 months will, by the time they are between 5 and 10, have bypassed the children of less advantaged parents who scored in the top quartile at that age.

But the emerging picture is one of greater complexity than policy discourse has acknowledged. Paternal or family income is only one, very limited, measure of mobility.

Factors such as genetics, class, social networks, nutrition, neighborhood and other demographics could play a role. Increasingly, sociologists are identifying noncognitive skills such as openness, grit and resilience— any of which could be influenced by the previous list—as elements of economic success.

For a number of years, I regularly helped disadvantaged job-seekers in a London-based charity. What became clear to me was that there are many routes into and out of poverty. Breakdowns in family or health—mental and physical—can put, otherwise, employable people onto skid row. So can caring for children or elderly parents, as can housing insecurity.

Two further barriers to the mobility the government seeks are a lack of language skills and digital literacy among many job-seekers.

Without working English and an e-mail account, even the bottom rungs of the ladder are out of reach.

Those I saw exit poverty almost invariably had qualities that were hard to put on a CV. They were eager to find a course, build skills, interview for jobs.

Their route out was rarely through demoralizing governmentrun job centers. It was most often a combination of self-motivation and the intervention of an adviser to identify strengths and weakness and map out a plan, often taking complex circumstances into account to find a way to build trust and confidence. It’s difficult for studies to capture such mobility triggers; harder still to quantify the satisfaction and security that a small step on the ladder can bring to those at the bottom.

BusinessMirror

A8 www.businessmirror.com.ph

Thursday, October 22, 2015

OF TANDUAY, RECOGNITION AND IMMORTALITY

I

B V G V

WAS a kid and I was deeply enamored by my grandpa’s wine cellar at their quaint little house on Adriatico Street. There he stashed an age-old bottle of Tanduay rum, among other spirits that, he said, were—if memory serves me right—at least over 20 years old at the time.

If you will “the joy of my life,” he said.

The bottles were gathering a veneer of permanent dust, and—being as naïve as I was back in the day—I remember asking when was he planning to drink his “beers [as I always referred to liquor as beer].”

“When it’s 100 years old,” he said. I only had come to understand later that a spirit is at its best when it’s at least a hundred years old. Some best things in life have to mature; some even take a life time before we get to taste them. But, then again, my grandpa has been long dead, and that bottle of Tanduay rum remains stashed in that cellar.

This came to mind when Tanduay rum was recently conferred with something commensurate to its august 160 years of tradition— the prestigious Brand of the Year Award, an accolade given by the equally prestigious Londonbased World Branding Forum (a global nonprofit organization on advancing branding standards) to only the world’s best labels that have always been at the back of our heads, such as household names Coca-Cola, Louis Vuitton and Nike.

Tanduay is the first homegrown brand in its category (Spirits-Rum) to have ever won The Brand of the Year Award in the entire beverage industry in the country; among the veritable

raft of local epics, like Jollibee, Puregold and Ayala Land, which have also won the plum this year.

Winners of the World Branding Awards were arduously singled out through three streams: Brand Valuation, Consumer Market Research and Public Online Voting, and leveraged on extensive media exposure, successful advertising and marketing.

From over 2,500 brands nominated from 35 countries, measly 119 were selected as winners, including Tanduay sharing the limelight with Apple, Samsung and Mercedes Benz at the awarding night on September 24 at Kensington Palace in London.

“This is a proof that we’re global and that people from other countries recognize our culture and tradition of making rum. We share the award with patrons, who have been drinking Tanduay and have been enjoying our product for the longest time,” said Gerardo Tan Tee, COO of Absolut Distillers Inc. of the Lucio Tan Group of Companies, which manufactures Tanduay.

This is the first time in the No. 1 rum’s 160-year history that its distillery and manufacturing was awarded thrice in five years. Before the Brand of the Year Award, Tanduay had garnered over 170 recognitions

TANDUAY is the first homegrown brand in its category (Spirits-Rum) to have ever won The Brand of the Year Award (in photo) in the entire beverage industry in the country

and swept awards ceremonies, among them the global Green Apple Awards in 2011 and the Green Hero Awards, which is also based in London, in 2012, mostly on account of the distillery’s environment-friendly manufacturing.

Tee said that, apart from sheer age and popularity, Tanduay’s green manufacturing is the No. 1 rum’s major fillip in winning these awards.

“A distillery is one of the world’s most ‘pollutive’ industries as far as manufacturing is concerned. What sets Tanduay apart from other brands is that every drop of alcohol is manufactured with ‘green intention.’"

A distillery comes with an environmentally detrimental, organic substance that, when disposed of into the sea, will suck oxygen from the

IN photo are (from left) Tanduay National Marketing Manager Garry Ong, AVP for Marketing Paul Lim and VP for Distillery Operations Gerry Tee at the 2015 World Branding Awards staged on September 2 at the Kensington Palace in London.

water, thereby killing fishes.

“We have become a responsible distillery by turning a problem into a resource—into a liquid fertilizer we dish out as part of our corporate social responsibility to farmers our chairman [Lucio Tan Sr.] regards as ‘business partners.’”

Tanduay’s Brand of the Year Award thrust is also attributed to its growth spurred by its prize marketing, what with its flagship take on Tanduay’s 160th anniversary.

“We started actually by just doing what we do best—what we do best is to maintain the high quality of our products. What is making money or what is relevant or what is popular we will maintain because the customers want it that way,” Tee said. “Anyone in our company can be fired by our partners [customers]; the only thing they will do is not to buy the product. We need to come up with something better, year in, year out. That is our mission and that is

our vision of how the company is going to be: innovation, evolution.”

The global brand has not been so much exporting outside the country and, in fact, had just started exporting, specifically to Miami in the US, last year. But Tee said that, since Tanduay is evolving, the rum is starting to be exported abroad, Europe being among the major export points. “‘Yung mga foreigners may dinadalang Tanduay sa Europe. When they come over, nabibili nila ‘to and nagkakaroon ng word of mouth. This is a signal for us to really go to Europe,” Tee said. “Sabi ko nga sa kanila, we have products here that are very costeffective. Tanduay is an inexpensive, but quality product. Where on Earth can you buy rum at $2 a bottle? It’s only here.”

Tan said that it is a proof that the Filipino ingenuity is really recognized globally. And for a brand that always identifies with

the Filipino, Tanduay’s origin has always been inextricably tied to “our culture, our heritage our aging—it’s our totality,” Tee said.

“Tanduay is fun, resilient, timeless. A Filipino is like that: We are resilient. We’re flexible, we adapt; Tanduay adapts to the changing times. Kahit ilang libong competitors ang dumating, nand’yan pa rin ang Tanduay. Like the Filipino, Tanduay is a legend,” Tee said. “Competitors come and go; it doesn’t bother us.

We encourage competition; we invite them to join the manufacturing sector because it will benefit the country. If your product is good, it will stand the test of time. Tanduay did and Tanduay will.”

Tanduay is and Tanduay ever will.

After all, Tanduay has been around for over 160 years and has witnessed its patrons, like my grandfather, come and go and become part of their lifetime. And a spirit that manages to outlive its drinker is, well, immortal.

WORLD BRANDING AWARDS

“[THE brand of the year award] is a proof that we’re global, and that people from other countries recognize our culture and tradition of rum-making. We share the award with patrons, who have been drinking Tanduay and have been enjoying our product for the longest time,” said Gerry Tee (left), COO of Absolut Distillers Inc. of the Lucio Tan Group of Companies, which manufactures Tanduay.