Businessmirror september 25, 2015

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Thursday 18, 2014 Vol. No. 40 Friday, September 25,102015 Vol. 10 No. 351

P25.00 nationwide | 7 sections 32 pages | 7 days a week

PHL ripe for another credit-rating upgrade A

nother creditrating upgrade is in the offing for the country, after international credit watcher Fitch Ratings raised its outlook on the Philippines to “positive” on the back of improved governance standards and competitiveness indicators.

INSIDE

Vasil who?

Sports

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BusinessMirror

| Friday, September 25, 2015 mirror_sports@yahoo.com.ph sports@businessmirror.com.ph Editor: Jun Lomibao

KIRyIENKA SURpRISING wINNER OF TIME-TRIAL wORLd chAMpIONShIp

VASIL WHO?

BELARUS’S Vasil Kiryienka celebrates his gold medal in the men’s elite time trials at the International cycling Union Road world championships. AP

By Dave Skretta

R

The Associated Press

ICHMOND, Virginia—Only a handful of people at the start line knew Vasil Kiryienka’s name on Wednesday.

They all knew it by the finish line.

The rider from Belarus topped a surprising podium in the time trial at the world championships, roaring over the 53-kilometer course, while three-time world champion Tony Martin and heavy favorite Rohan Dennis missed out on medals entirely.

Kiryienka made the ride from the Kings Dominion amusement park to downtown Richmond in one hour, two minutes and 29 seconds. Adriano Malori of Italy was nine seconds back to take silver, and Jerome Coppel of France another 17 seconds back to earn bronze.

“Kiryienka has been knocking on the

door for a while. I feel like he’s been up there for a long time,” said Taylor Phinney, the top American rider in 12th place.

Perhaps, he’s been knocking on some doors, but he certainly wasn’t among the favorites.

Spain’s Jonathan Castroviejo and Tom Dumoulin of the Netherlands were next, both of them having started with medal aspirations. But Dumoulin may have been undone by a massive effort in the recently concluded Vuelta a España, nearly winning the three-week grand tour.

Then came Dennis, who helped BMC Racing to the team time-trial gold on Sunday. He was fourth through the second time check and was picking up time, but had a mechanical problem and needed to change bikes. That lost time may have been enough to keep him off the podium.

“Maybe I would have come close to a medal,” he

FILIpINO-AUSTRALIAN Jason day, in this file photo posing with the wanamaker Trophy after winning the professional Golfers’ Association championship, is one of the big guns for the FedEx cup. AP

said, gazing at the final results. “It was a lot different than we expected. I’m not sure, to be honest, what happened. I expected Tony to be on the podium no matter what.”

Indeed, Martin has been one of the world’s best in the race against the clock for years, and was trying to join Switzerland’s Fabian Cancellara as the only riders to win four world titles. He was second at the first time check, too, but kept losing seconds all the way to the finish, where he was at a loss trying to understand what had happened.

“It was super-fast and then I lost my rhythm. I couldn’t find it back,” he said, “and then I also lost morale to the finish. It was absolutely not my day.”

Martin said he didn’t think the broken collarbone he sustained in the Tour de France, or the missed training time, hurt his chances. He also didn’t blame Sunday’s team time trial, where he was part of the silver medal-winning Etixx-QuickStep squad.

“I had a very good preparation, never had pain, so I felt quite OK,” he said. “I wanted to go for gold. I was sure I would go for gold, and it came out completely different than I expected.”

The British team, trying to land a top 10 to secure two berths at the Rio Olympics, failed in their quest with Chris Froome and Geraint Thomas missing to injury and fatigue. Stephen Cummings came home in 14th and Alex Dowsett was 17th among the 65 riders who took the start.

The course is open to training on Thursday before competition resumes on Friday with the start of the road races. The women’s elite race is on Saturday and the men’s elite race is on Sunday.

Riders will be happy to get away from a long, undulating time-trial course that left them exposed to gusty winds. In fact, the race was so grueling on Wednesday that Australia’s Michael Hepburn vomited off his bike twice as he approached the final 100 meters.

Hepburn’s time stood for nearly 30 minutes before the heavy hitters took the course.

Coppel, the relatively unknown French time-trial champion, was the first rider to post a time that looked as if it would stand. Malori finally bumped him from the top step, the three-time Italian timetrial champion gritting his teeth as he powered down Broad Street.

Kiryienka was still on the course, though.

The bronze medalist in 2012, he was fastest from the first time split on, effortlessly slicing through the wind on the long straightaways. And by the time Kiryienka crossed the finish line, the two remaining riders on the course had no chance to catch him.

Jurgen van den Broeck of Belgium, who finished well off the pace, may have summed things up best after gazing at the standings: “It’s a pretty surprising top 3.”

BIG 3 BATTLE FOR $10-M BONUS

By Doug Ferguson

A

The Associated Press

TLANTA—The best three players in golf have combined to win 12 tournaments and over $25 million this year, so the appeal of a $10-million bonus for capturing the FedEx Cup might not be as great as simply winning the final showdown of the season.

But there was a time when money mattered for Jason Day, Rory McIlroy and Jordan Spieth.

McIlroy was an 18-year-old rookie in 2007 playing his second tournament as a pro when he finished third at the Dunhill Links Championship. That not only wrapped up his European Tour card, it paid just over $300,000 (£211,332).

“I remember I wanted this watch,” McIlroy said on Wednesday. “And I remember it was the week after the Dunhill Links in 2007, and it was one of the bigger prize funds on the European Tour. At this stage, the money from the European Tour was just going into my debit account, whatever bank I was using in Ireland. And I went to get money out of the ATM the week after and the check had obviously been put in.

“And I wanted to check my balance and it was like £220,000, and I was like...I mean, I went straight to the store and bought the watch.”

Now they’re more interested in a pair of titles—the Tour Championship and the FedEx Cup—along with a singledigit number.

The battle for No. 1 enters its sixth straight week in golf.

Day reached the pinnacle for the first time in his career with no argument. His six-shot victory in the BMW Championship last Sunday was his fourth win in his last six starts. That includes a record score at the Professional Golfers‘ Association (PGA) Championship

and a six-shot win at another FedEx Cup playoff event.

Day also is No. 1 going into the FedEx Cup finale at East Lake, though with a much slimmer margin.

To make the Tour Championship a weighted free-for-all for the 29 players at East Lake (Jim Furyk withdrew with injury), the points have been reset so that the top 5 players only have to win the tournament to claim the $10-million bonus.

Day is followed by Spieth, Rickie Fowler, Henrik Stenson and Bubba Watson.

McIlroy, who missed two months and one playoff event because of an ankle injury, is No. 11. For him to claim the FedEx Cup, he would have to win the Tour Championship and the top 5 in the standings would need to finish out of the top 6 depending on their ranking.

Part of him wonders if he’s due for that to happen. McIlroy was the No. 1 seed in 2012 on the strength of winning two FedEx Cup playoff events, tied for 10th at East Lake and lost out to Brandt Snedeker. He was the top seed going into the postseason a year ago on the strength of his two majors, was runner-up in the Tour Championship and finished behind Billy Horschel, who won the last two events.

“So maybe this time being outside...maybe get the job done a different way,” McIlroy said.

No one has ever won three FedEx Cup playoff events, and that’s an opportunity for Day. The 27-year-old Australian is pounding his driver long and straight, his short game is finally getting its due attention and he’s putting well. It’s an unbeatable combination, as the victories attest.

Perhaps even more daunting is that Day is 101-under par in his last seven tournaments dating to the British Open.

No one knows how well Day is playing more than Spieth. They have been in the same group seven of the last nine rounds dating to Sunday at the PGA Championship. Spieth was runner-up at Whistling Straits, missed the cut in the opening two FedEx Cup events and then got his game turned around last week north of Chicago.

Or at least he thought he did.

Spieth opened at 65-66—and he was still seven shots behind Day. “What he did...I mean, he destroyed my score in those rounds for lack of a better term,” Spieth said. “It is very motivating because my personality, I don’t like getting beat in anything and I’m very stubborn. It doesn’t make me angry. It makes me want to get back to the level I was playing at this whole year, and see if the top of my game can beat the top of anybody else’s game when they’re at their best.”

That’s the beauty of this Tour Championship. All the best are at their best. The top 5 in the FedEx Cup are among the top 6 in the world ranking. Starting on Thursday, they get one last chance to battle for at least one trophy (Tour Championship), maybe two (FedEx Cup) and a $10-million bonus.

Sports

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soulful experience Motoring BusinessMirror

Henry Ford Awards Best Motoring Section 2007, 2008, 2009, 2010 2011 Hall of Fame

Editor: Tet Andolong

Friday, September 25, 2015 E1

Soulful experience soul oF moTion The new mazda 6

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Story & photos by Randy S. Peregrino

HERE is more to the stunning, refined and imposing presence of the third-generation Mazda 6. At a glance, it stimulates your senses and makes you understand what the “Kodo-Soul of Motion” design philosophy is all about. Even when standing still, it gives the impression that it is constantly moving.

Prominently, the exterior exudes charm that stems from the character lines and distinctive silhouette, which contribute to the New Mazda 6’s striking stance.

The signature five-point grille unites with the slender adaptive projector type LED headlamps with daylight running lights.

Together with the hood, they create a fascia with a strong sense of charisma that seems to come straight at you. The Mazda 6’s rear is not lacking in terms of aesthetics with its equally molded delineations with black trim highlighting the twin exhaust with polished tips. What contributed to the car’s eye-catching posture is the combination of the 19-inch, gunmetal finished rims and 225/45 series tires. Harmonized with the test unit’s soul red body color, the New 6 is definitely an attention magnet wherever it goes.

Upon opening the vehicle’s doors, this writer was immediately enamored with the eye-catching, two-toned interior color scheme.

Perforated, white leather material that accentuates the black leather

seats and trim, along with additional brushed metal touches here and there added a pleasing element of elegance.

The ergonomic and intuitive cockpit makes the New Mazda a true driver-oriented car. Aside from the chunky steering wheel with embedded controls and paddle shifters, the 7-inch touchscreen operated infotainment with Bluetooth connectivity sits high enough for ease of operation.

A command control knob located just below the shift handle makes screen operation fast, easy and safe. Moreover, it is packed with other automated features, such as

electronic parking brake button, push start/stop ignition, auto on/ off headlamps and wiper control among others.

The New Mazda 6 drives just, as well as it looks thanks to the numerous advancements included in the vehicle package. For one, there’s the state-of-the-art i-Stop feature, which promotes fuel efficiency by triggering a seamless mechanism that switches off the engine at every stop and resumes ignition faster than the initial startup as soon as the brake pedal is released. If the driver wants the motor to run continuously, there’s a separate switch available to disengage it.

The New Mazda 6’s 2.5-liter engine, which is coupled to a six-speed A/T, offers a choice of dynamics to suit particular driving preferences. In default mode, the engine reaction is smooth and provides adequate torque with the gear shifting done with the low end range. On the other hand, there’s an accessible power toggle that instantaneously transforms the engine into a more aggressive unit. The accelerator pedal—even with light pressure—becomes more sensitive to any throttle opening and moves the gear shifting to a higher range.

A significant amount of force

THumbs up

THe cockpit layout is ergonomic and intuitive.

becomes evident and results in more powerful acceleration that’s somewhat close to a V6 motor.

In manual mode, the engine is even more responsive and changing gears is kept within the optimum range, making speeding up seamless and overtaking a cinch.

On the road, the combination of the front MacPherson struts and rear independent multilink suspension provide a comfortable ride and excellent handling.

Steering is accurate and reactive, thanks to the electronic-assisted rack and pinion.

A positive outlook means that a rating upgrade is possible in the next 12 to 18 months for the country.

Of the three major credit watchers, Fitch is the only credit watcher that rates the Philippines a notch above junk status. Moody’s Investors Service and Standard & Poor’s Ratings Services puts the country two notches above junk status.

“Governance standards and competitiveness indicators, as measured by international organizations, have shown steady improvement through the Aquino administration. Global competitiveness, as ranked by the World Economic Forum, has risen to a level Continued on A2

Continued on E4

THumbs down

n Kodo-Soul of Motion inspired exterior design n Two-toned interior color scheme n i-Stop idling stop system n Engine performance on power mode n Adaptive LED projector type headlamps

speciFicATions

By Bianca Cuaresma

dimensions n Overall length: 4,865millimeters n Overall width: 1,840 mm n Overall height: 1,450 mm n Wheelbase: 2,830 mm n Front track: 1,595 mm n Rear track: 1,585 mm n Tire size: 225/45 R19 n Price as tested: P1.785 million (plus P16,800 premium for the Soul Red color option)

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DENR to review CoC of VW Philippines

By Catherine N. Pillas

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BusinessMirror media partner

they kick off a five-day amphibious military exercise at the Philippine Marines training center in Ternate, Cavite, on Thursday. The naval exercise, dubbed Pagsisikap 2015, is aimed at enhancing the capability of the Marines’s fleet and forces, as well as to strengthen its interoperability. AP

n Minimal tire rebound n Side mirror’s position, which produces a blind spot

Motoring

n Vehicle: Mazda 6 Skyactiv-G 2.5 n Type: Midsize Sedan/Executive Sedan/Large Family Car n Engine: 2.5 liter, in-line four cylinder, DOHC, 16 valve, gasoline-fed n Maximum power: 185 hp at 5,700 rpm n Maximum torque: 250 Nm at 3,250 rpm n Transmission: Skyactiv-Drive Six-speed automatic

NAVAL EXERCISE Philippine Marines from the Naval Special Operations Group storm the beach to simulate an “extraction” of a kidnapped victim, as

he Department of Environment and Natural Resources (DENR) is set to look into the compliance of Volkswagen (VW) Philippines to the country’s own emission standards, prompted by the admission of the world’s largest carmaker that it has skirted emission regulations in the United States.

PESO exchange rates n US 46.7380

Environment Undersecretary Jonas R. Leones said the worldwide scandal that VW is now facing has signaled the DENR to review the certificate of compliance (CoC) of the local unit for its distributed diesel models.

“We will first determine the models of Volkswagen that the international media reported as having been tampered with. After that, we’ll compare the data on

emission testing they have abroad and compare it with the data they submitted here; and, if we see that it similarly does not comply with our standards, because the emission results for the same models are not right, we will be compelled to revoke the CoC,” Leones said in a phone interview.

Leones, the former Environmental Management Bureau director, said the Philippines adopts different emis-

sion standards other than those of the US’s. He declined to prematurely give implications on the local market.

VW Philippines was contacted for comment, but said it is waiting for the official statement from its mother unit in Europe.

VW announced that its CEO Martin Winterkorn has resigned, days after admitting that the company has rigged diesel emissions Continued on A2

POLICY RATES KEPT AS WHAT ANALYSTS ANTICIPATED

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n a move widely expected by markets, the Bangko Sentral ng Pilipinas (BSP) kept all policy knobs unmoved during Thursday’s policy meeting, as the benign inflation provided further room for the monetary authority to keep its key rates steady.

In its sixth monetary meeting for the year, the Monetary Board reaffirmed that the current monetary setting remains appropriate for the present economic conditions in the country, keeping the repurchase rate (RP), or overnight lending rate, at 6 percent, and 4 percent for the reverse repurchase rate (RRP), or overnight borrowing rate.

The interest rates on term RRPs, RPs and special deposit accounts (SDA) were also kept steady.The reserve requirement ratios were, likewise, left unchanged.

The seven-man monetary policymaking body of the BSP decided against changing its policy stance for the seventh consecutive time due to its assessment of benign inflation for this year and the next two years.

In fact, the central bank has lowered its inflation forecast for the 2015 inflation average anew in its September meeting.

Inflation in the country is now expected to average at 1.6 percent this year— indicating that any increases in inflation in the next months will be minimal.

The current inflation average of the country as of August this year is at 1.7 percent. This is due largely to the continuing softening of oil prices, as well as food costs. In contrast to the adjustment in the inflation path for the year, the inflation forecasts for 2016 and 2017 were revised upward, due mainly to the expected gravity of the dry spell’s impact, which is expected to be felt this year and the next.

The central bank adjusted its inflation forecast for 2016 to 2.6 percent— slightly higher than the earlier forecast of 2.5 percent. For 2017, meanwhile, the forecast is now at 3 percent, from the earlier assessment of 2.6 percent.

The forecasts for both years are within the government’s target for 2016 and 2017, at 2 percent to 4 percent.

According to the central bank, the higher inflation seen for 2016 and 2017 is due to the stronger El Niño expectations, global uncertainty and, Continued on A2

n japan 0.3887 n UK 71.2568 n HK 6.0310 n CHINA 7.3212 n singapore 32.7802 n australia 32.7871 n EU 52.2624 n SAUDI arabia 12.4628 Source: BSP (24 September 2015)

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BusinessMirror

Friday, September 25, 2015

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PHL ripe for another Govt on track to meet infra credit-rating upgrade spending goal for the year Continued from A1

comparable to “BBB”-rated peers.

Indicators for corruption, transparency and economic freedom have also improved substantially,” Fitch said.

Fitch also mentioned the country’s strong macroeconomic story— particularly the outperformance of economic growth, favorable demographics, external finance strength and low public debt.

Economic managers welcomed the development from Fitch.

“Sharp market volatility witnessed recently across the globe posed threats of spillover effects on the real sector of economies. What makes the Philippines an outperformer are its strong fundamentals, which entice short- and long-term capital once markets see through the temporary noise,” Bangko Sentral ng Pilipinas Governor Amando

M. Tetangco Jr. said.

“The positive outlook from Fitch signals the long overdue creditrating upgrade, which appropriately reflects the economy’s outperformance,” he added.

Finance Secretary Cesar V. Purisima said the revised credit outlook is a reflection of what financial markets say all along about the Philippines’s creditworthiness.

“The Philippine economy continues to perform strongly despite turbulent headwinds, while financial markets continue to assess Philippine debt way better than what a ‘BBB-’ rating reflects. We thank Fitch for coming out with a positive outlook. While we still think we are underrated [we continue to outperform our ‘single A ’-rated neighbors in Southeast Asia], this is definitely a move in the right direction,” he said.

Fitch further noted that the “positive” outlook could eventually lead to a rating upgrade if there is evidence that improvement in governance standards over the Aquino administration can be sustained following a change in the government; there is continued strong growth without the emergence of imbalances; and there is evidence of a broadening of the general government revenue base that lends greater stability to the government finances.

However, the main factors that could see the ratings revert to “stable” outlook are: deterioration in governance standards or a reversal in reforms that were implemented under the Aquino administration and the instability in the financial system, possibly triggered by a sustained period of excessive credit growth, which could be considered credit-negative.

Policy rates kept as what analysts anticipated. . . eventually, the volatility it causes on currencies, including the peso. BSP Governor Amando M. Tetangco Jr. said the growth of consumer prices will “gradually” move toward the target band.

“The Monetary Board’s [MB] decision is based on its assessment of the dynamics and risks in the inflation environment over the policy horizon.

The MB is, likewise, of the view that domestic demand conditions remain firm, supported by buoyant business and consumer sentiment and ample domestic liquidity,” the governor said in his statement.

BSP Deputy Governor for the Monetary Stability Sector Diwa C. Guinigundo, meanwhile, welcomed the government’s preemptive moves to

D

By Cai U. Ordinario

espite the government’s lackluster spending performance in the first semester, a local think tank believes the national government is still on track to meeting its infrastructure spending goal this year.

First Metro Investment Corp.

(FMIC) and University of Asia and the Pacific (UA&P) Capital Market Research said the recent increase in infrastructure spending will likely continue in the second half of the year and account for 4 percent of the country’s gross domestic product (GDP).

“Fiscal spending finally took off in July with its 25-percent year-on-year growth. Infrastructure spending and capital outlays shot up by 93 percent, vindicating the continuing efforts

especially by the DPWH [Department of Public Works and Highways] to meet infrastructure spending goal of 4 percent of GDP this year,” the group explained.

FMIC-UA&P Capital Market Research said the increase in infrastructure spending will also drive economic growth in the third and fourth quarters. The group said it is maintaining its full-year growth forecast of 6.2 percent in 2015 due to better economic prospects in the second semester.

It added that the country’s growth target of 7 percent to 8 percent will be impossible to meet given the 5.3percent average growth posted in the January-to-June period.

“Despite the improvement in second-quarter growth, attaining the lower end of the official 7-percent to 8-percent growth target this year will entail an average of 8.7-percent GDP growth for the next two quarters. We don’t see the economy capable of achieving this.

Still, we retain our positive outlook in second half and project full-year GDP growth of 6.2 percent,” the group said.

Apart from increased government spending, the country will also benefit from steady remittance flow and low inflation.

Steady inflow of overseas Filipino worker remittance growth is expected to average 4 percent to 6 percent in the second semester despite the negative effect that low oil prices have on Middle East economies.

Continued from A1

mitigate El Niño risks.

“We have received reports that the government has already undertaken a number of initiatives to precisely address and mitigate the expected impact of El Niño, particularly on fishery, livestock and poultry, and on some selected crops, such as rice, corn, fruits and vegetables,” Guinigundo said. Bianca Cuaresma

DENR to review CoC of VW Philippines . . . to pass US tests (Related story on B2-3).

A DENR Administrative Order released early this year tightened emission standards starting July, limiting a vehicle’s carbon-monoxide emission to 2.0 grams per

kilometer (g/km) for gasoline-fed passenger and light-duty vehicles, instead of the current 2.2 g/km, and 0.9 g/km from 1.0 g/km for dieselengine vehicles.

According to reports, the models tampered with include 2009 to 2015

Continued from A1

TDI Volkswagen Golf, Jetta, Beetle and Audi A3s, as well as the 2014 to 2015 Passat. In the Philippines,VW models being offered include the Beetle, Jetta, Polo Notch, Touran, Tiguan, Touareg Sport Edition, Golf GTI, Polo Hatchback and the Passat.

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The Nation BusinessMirror

LTFRB taps tech firm in creating mobile app for motor insurance

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HE Land Transportation Franchising and Regulatory Board (LTFRB) is now in discussion with local tech company Galileo Software Services Inc. to develop a smartphone application that aims to help motorists file their insurance claims during traffic incidents via their mobile phones.

The Police Accident Report Kit (Parak) app, Galileo founder Rodolfo Noel I. Lozada explained, will also help traffic enforcers immediately clear the road after an incident, thereby preventing traffic congestion in the process.

“The application has an electronic incidentreport document that motorists involved in an accident can sign, which, together with the pictures, can be e-mailed to the insurance company on the

spot to file road-accident damage claim,” he said.

The agreement with the LTFRB is expected to be out soon.

“One of the main causes of traffic congestions on main roads are minor traffic incidents involving motorists who want to get ahead of one another in busy intersections; the challenge for our traffic enforcers is how to quickly clear these road mishaps to prevent traffic congestion,” Lozada said.

He added: “Once traffic law enforcers are equipped with smartphones with Parak application, motorists involved in accidents can amicably settle the issue and forward the evidences and legal documents to their insurance companies on the spot.” Lorenz S. Marasigan

Losing gunners now a thing of the past with new APCs

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ITH the Mechanized Infantry Division (MID) now starting to field remote-control weapons system (RCWS)-equipped armored personnel carriers (APCs), the time when gunners are killed manning their weapons is now a thing of the past.

This is because RCWS can be operated and fired inside the APCs, MID Public Affairs Office chief Maj. Filemon Tan said.

Targeting, imaging and firing systems of the RCWS are safely contained inside the APC, which is well protected from small and medium arms fire.

Tan said locating and aiming potential targets in RCWS-equipped vehicles are relatively easy, thanks to its thermal imaging and laser sights, which are effective up to 3 kilometers.

In older armored fighting vehicles, gunners are usually stationed in revolving cupolas and are primarily responsible for locating and firing back at their targets with minimal protection.

And should the RCWS be damaged by enemy fire, it is much simpler to have it repaired or replaced than treat or evacuate a badly wounded gunner.

Six M-113A2 APCs, equipped with .50 caliber RCWS, are now undergoing acceptance tests at MID headquarters in Camp O’Donnell, Capas town, Tarlac.

Another four APCs, this time fitted with 25mm RCWS, are expected to arrive next year, followed by another 14 M-113A2 armed with 76mm guns and four armored recovery vehicles.

This is part of the P882 million 28 APC deal signed with Elbit Systems Ltd. on June 22, 2014.

The PA operates around 343 armored fighting vehicles (AFVs) and APCs. Around 85 percent of these AFVs are on green status (fully mission capable), while another 10 percent are on yellow status (undergoing repair) and 5 percent are on red (beyond repair). PNA

Editor: Dionisio L. Pelayo • Friday, September 25, 2015 A3

De Lima bids adieu after creating team to investigate lumad killings

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By Joel R. San Juan

USTICE Secretary Leila M. de Lima on Thursday bid good-bye to employees of the Department of Justice (DOJ), after creating a 16-man fact-finding team to investigate the killings in the indigenous lumad communities in Mindanao.

The team is expected to specifically focus on violence clutching those at the United Church of Christ of the Philippines-Haran Compound, Davao City; in Talaingod, Davao del Norte; Pangantucan, Bukidnon; and Lianga, Surigao del Sur, as well as all other related incidents.

De Lima said she created the team upon order by President Aquino.

“We want to know the root causes of these incidents,” de Lima told reporters during ceremonies celebrating the 118th anniversary of the DOJ. “There are those who say it could be the mining companies or the Left, but, of course, these are all theories, and we need to dig deeper. We have to know the cause of the lawless activities.

There are already so much displacement among the lumads.”

She added that the team will also determine the extent of military presence in the area.

“We have to determine the real state of affairs in the area. Of course, it is the

military’s mandate to protect the areas they believe are under the influence of rebel groups. Pwede naman justified ’yung presence nila but pwede ring nasobrahan,” she added.

Non-governmental organizations have pointed to government troops as behind the arming of paramilitary groups suspected of being behind the killings of several indigenous lumad peoples and a teacher.

In her speech during the anniversary celebration, de Lima acknowledged that she was not able “to fulfill her mission of delivering justice for all” during her five-year stint as justice secretary.

But de Lima said she is certain she would be leaving behind a justice department that “will, in time, accomplish that mission.”

“As I turn over the reins to a new secretary of justice in a not-so-distant time, I fervently wish that he or she will carry on with the good works of justice that we have begun and sustain

the good things that we have institutionalized,” de Lima said.

Apparently addressing the accusation made by the Iglesia Ni Cristo that she transgressed freedom of religion when she entertained an illegal-detention complaint against some of its leaders, de Lima said the DOJ “cannot just turn its back on those seeking for justice.”

“A case in point involves a certain religious organization. We have been pilloried before the public as violators of their freedom of religion, simply for doing our job. In standing our ground, we were only guided by these principles: equal protection of the law and justice for all. Our department is the first resort of those who cry for justice,” she said.

In an ambush interview following her speech, de Lima told reporters she is seriously considering a senatorial position, but it would depend on whether she would be included on the administration’s list of senatorial candidates.

“Again, let’s wait for the official announcement. If they do make the official announcement and I happen to be in the ticket, I will accept it also categorically,” de Lima said.

When asked about her possible replacement, de Lima said: “I cannot categorically say, because I don’t want to preempt the President because [he] has asked me already about it two or three weeks ago on who is my preferred successor, and I mentioned the name. [The person] was also acceptable on his part.”

Economy

A4 Friday, September 25, 2015 • Editors: Vittorio V. Vitug and Max V. de Leon

BusinessMirror

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PHL and Israel explore bilateral tourism ties

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By Ma. Stella F. Arnaldo | Special to the BusinessMirror

PHILIPPINE delegation, led by the Department of Tourism (DOT), will be going to Israel next year to promote the Philippines further, encouraged by the double-digit growth in arrivals from said market.

This developed as Tourism Secretary Ramon R. Jimenez Jr. and Israel’s Minister of Tourism Yariv Levin met last Thursday at the agency’s office in Makati, to further discuss bilateral cooperation on tourism promotion between their respective countries. Both agreed to jointly promote tourism within the framework of the agreement signed by their respective governments in 1987.

Pioneering flag carrier Philippine Airlines (PAL) said it was also studying the route between Manila and Tel Aviv, following last year’s signing of an air services agreement (ASA) between the Philippines and Israel.

Tourism Undersecretary for Tourism Development and Spokesman Benito Bengzon Jr. told the BusinessMirror that Israel is one of the agency’s targetted new markets this

year. “Over the last several months, we have been hosting a number of Israeli agents and media on familiarization tours.”

He added that the DOT will participate in the International Mediterranean Tourism Market in Tel Aviv in February 2016, to strengthen the awareness of the Philippines. We’ll be putting up a booth jointly with our partners from the private sector, particularly tour operators and properties that cater to the Israeli market.”

In his meeting with Jimenez, Levin highlighted the special role tourism cooperation can play for both economies. “When we put together the history of our relations, the natural attraction of the Philippines and the spiritual attraction that Israel represents, the potential is huge.”

For his part, Jimenez said: “It

Government watchdog wants next leaders to present economic plan

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OV’T Watch, a government watchdog led by industrialist Raul T. Concepcion, urged those vying for government position in the next administration to present their economic platform now.

“Our next set of leaders must be able to present to us a clear platform of governance that will show us how they intend to build on the economic gains we have made in recent years,” Concepcion said.

Gov’t Watch, in a statement, noted that the economy continues to grow at a steady pace with increased household consumption, lower inflation and unemployment rates, plus an improved credit rating from the likes of Standard & Poor’s, Moody’s and Fitch Ratings.

“Their economic platform must be able to institute policies that will better support inclusive growth, as macroeconomic gains may not necessarily be left by the pot who make up a greater number of the population,” it said.

is a great honor for the Philippines to have been chosen as the first trip abroad of Levin as minister of tourism. Your visit sends a very powerful message that we need to promote the Philippines in Israel, and any information on the Israel market would be greatly appreciated. It is also very timely, as we are now reviewing areas of concentration in tourism promotion.”

DOT data showed a total of 8,776 Israelis visited the Philippines in 2014, up 14 percent from 7,675 in 2013. From January to July 2015, Israeli tourists already reached 6,900, up a staggering 44.4 percent from the same period last year. The Philippines’s beaches, diving spots and island getaways are the main draws for Israelis. Asia is a major destination, with more than 150,000 Israelis arriving each year.

The ASA between both countries was updated and signed last year, allowing designated carriers to fly 21 flights a week. Also, both countries agreed to choose a third country for coterminal rights and stopovers. Another feature of the ASA is allowing designated carriers three fifth freedom flights per week, using Mumbai as an intermediate point and Madrid as a beyond point.

Fifth freedom rights allow a carrier to fly between two foreign countries during flights originating or

ending in said airline’s home country.

In a news statement, Levin said: “We need to improve flights between Manila and Tel Aviv, as there are no direct flights to and from these destinations, except for chartered flights. There is actually keen interest in opening new routes.”

The DOT’s Bengzon added: “We are, likewise, working double time on chartered flights that would cater to the tourists in Israel.”

In a text message, PAL President Jaime J. Bautista said he had a meeting with Levin, as well, last week.

“We will evaluate the route,” was his reply on whether the flag carrier had any plans to fly to Tel Aviv, the capital of Israel.

But he noted that Levin “did not say if El Al [Israel’s flag carrier] will fly to Manila.”

Bengzon underscored the historic ties between the Philippines and Israel, as President Manuel Quezon Sr., under the Commonwealth period, saved 1,200 Jews from being extinguished during the Nazi regime in Europe. Most of these Jewish refugees came from Austria and Germany.

“It’s a big deal for them [the Jews]; they can’t forget how the Philippines helped them. And because of our assistance to them, effectively, we can target not only the Israelis, but Jews in other countries [as a tourism mar-

ket],” he said.

He added that among the favorite attractions of the Philippines to Israelis are Boracay and Banawe.

“They don’t have much greenery [and beaches], because their country is so small.”

Meanwhile, Jimenez and Levin agreed to the promotion of sustainable tourism through the sharing of best practices, exchange of experts and provision of trainings. Also discussed was exploratory projects on community-based programs focusing on, but not limited to, agritourism and ecotourism.

The DOT chief believes that the visit is one way of celebrating awareness between each country.

He said: “I hope that we can step up cultural exchange, especially in music,” responding to Levin’s statement that “Israel’s tourism boasts of diverse music, food and culture, among others.”

Statistics from Israel’s Ministry of Economy showed that 11,156 Filipinos visited Israel last year.

The Philippines is considered Israel’s sixth- largest market in Asia.

Filipinos go to Israel usually for pilgrimage tours via connecting flights from a third country. Filipinos don’t need a visa to go to Israel—an examption that has existed since 1969—which has helped develop outbound travel to said country.

Hong Kong luring Filipino tech start-ups

According to Gov’t Watch, inclusive growth is essential to reducing poverty, as greater opportunities are created for the poor and marginalized to improve their standards of living.

Gov’t Watch also said that future leaders must be emphatic attuned to the feelings, wants and needs of the people.

“Demonstrating empathy will allow them to create policies that are truly responsive, thereby fostering a relationship of trust and loyalty between the leader and constituent,” it said.

Gov’t Watch appealed to the electorate to be meticulous and discerning in the selection of the new leaders.

“There is too much at stake for us to base our votes solely on popularity and personality. As we live in a and age social media and hyperconnectivity, where information is easily accessible, it has become easier for us to do our due diligence as responsive voters,” it said.

Simon Galpin (right), director general of Investment and Promotion, and Gregory So, secretary for Commerce and Economic Development, of the Hong Kong Special Administrative Region, discuss possible business ventures of Philippine companies in Hong Kong. It’s “One Belt One Road” initiative is seen to generate demand and increase the volume and intensity of international trade among countries. Stephanie Tumampos

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NEW WORLD RECORD

The country bagged the Guinness World Record for the most number of origami lanterns displayed at Megaworld’s Lucky Chinatown Mall in Binondo, Manila. More than 19,000 origami lanterns were shaped into a huge dragon in celebration of the Chinese Mid-Autumn Festival, or commonly known as Mooncake festival. The lanterns symbolize hope, power and strength based on traditional Chinese belief. NONIE REYES

he Hong Kong Special Administrative Region (HKSAR) is eyeing to lure in more Filipino start-ups, saying its vibrant technology environment and large population of high-income individuals can be prime sources of funds for fledgling firms.

“We focus not just on the sector but the activity. Hong Kong is good for research and development and capital raising, but the big growth area for us which we’d like to explore is high-tech start-ups,” said Simon Galpin, director general of Investment Promotion of Invest Hong Kong, during its business seminar on Thursday in Makati City.

Galpin said with the large population of high net-worth individuals (HNWI) in Hong Kong, the growing number of Filipino start-ups can have a chance of partnering up with business incubators and possible angel investors to fund their businesses.

“Although Hong Kong is not known to be an inexpensive city, there are a lot of coworking spaces

and there are a lot of good deals with these business incubators.

Barriers to entry is really low,” Galpin added.

There are 138,000 HNWIs in Hong Kong, Galpin said, an increase of 273 percent over an eight-year period, or from 2008 to 2016.

The technology start-up community in the Philippines leverage on the players’ technological know-how to create tech-based innovations, such as mobile applications and systems. Funding for the product development, marketing and training are coursed through local incubators/accelerators such as IdeaSpace Foundation and Kickstarter Foundation.

According to a United Nations Study, Hong Kong has surpassed the US in the area of foreign direct investment (FDI) flows globally.

It is second to China in terms of outflows and inflows. Mainland China has increasingly been leveraging the SAR as a launchpad for outward investments.

“Hong Kong is a major conduit of FDI. For the first time,we’ve ranked FDI for inflows, and second

also in outflows,” Galpin added.

Adding to the attractiveness of Hong Kong is its free-trade agreement (FTA) with Mainland China, which, it boasts, is the most progressive ever concluded by the world’s second-largest economy.

“Our FTA with Mainland China is nationality neutral. So it means that a Filipino company incorporated in Hong Kong can enjoy the same benefits as a Hong Kong-national company in Hong Kong. We hope by this we hope we can help Filipino companies extend to the mainland,” said Gregory So, secretary for Commerce and Economic Development of the Government of HKSAR, in an interview.

The Board of Investments, at the sidelines of an InvestHK Business Seminar, inked a memorandum of intention with InvestHK for cooperation on investment-promotion exchange and best practices.

InvestHK is a department under the HKSAR’s government tasked attract FDI, as well as provide business assistance to potential investors to Hong Kong. Catherine N. Pillas

FPI: Probe charges of shipping companies

By Catherine N. Pillas

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hipping lines continue to impose various burdensome fees on traders, prompting the Federation of Philippine Industries (FPI) to ask Senate to conduct an investigation on the matter.

The FPI, the country’s largest organization of manufacturers, sent a letter this week to Senate Trade, Commerce and Entrepreneurship Committee Chairman Paolo Benigno “Bam” Aquino IV to air its concern on the rising shipping fees.

“While some shipping lines have discontinued the collection of port-congestion surcharges (PCS), there are other types of charges that have been imposed by various shipping lines,” said FPI Chairman Jesus L. Arranza in his letter to the senator.

“In view of its sheer gravity, which is seriously affecting the national economy, as well as the competitiveness of local manufacturers and directly impacting consumers, the federation wishes to seek your intervention in finally investigating this matter,” he added.

The other charges reportedly being imposed by the shipping lines are the emergency cost-recovery surcharge, container imbalance charge, equipment positioning services, container cleaning fee, documentation fee at destination and terminal handling charge.

Based on FPI’s computation, with these six additional fees, the average shipping cost per 20-foot container van now amounts to P 27,159.

This makes the Philippines’s shipping charges the highest among five economies compared by the FPI. Other countries’ shipping charges are Indonesia, P465 to P4,737.89; Malaysia (Kuantan Port), P5,360.6 to P5,634.10; Malaysia (other ports), P5,743.5 to P5,907.60; Singapore, P11,118.65 to P10,952.70; Thailand, P7,804.50 to P9,288; Bangladesh, P3,952.50; Japan, P12,692 to P12,540.

The data were culled by FPI from the web site of MCC Transport and Overseas Orient Container Line.

The DTI’s Consumer Protection Group (CPG) announced early this year that many shipping lines have already withdrawn the PCS, the main charge imposed by many lines during the height of the container buildup last year.

However, despite many major shipping lines’ decision to remove the PCS, many other charges remained, including the fees cited by FPI. Arranza said the Maritime Industry Authority (Marina) is unsure whether it has the authority to regulate shipping charges, but has organized a dialogue with shipping lines.

The DTI’s CPG, back in April, aired the possibility of Marina regulating the charges of international shipping lines.

Asked for an update, Trade Undersecretary for the CPG Victorio Mario A. Dimagiba said that the Consumer Protection and Advocacy Bureau had a meeting earlier this month with Marina.

“Marina said that there is no standard rule on the rate of charges of international shipping lines.

They conducted a survey of 170plus ship agents but so far has only gotten responses from 12,” Dimagiba said in a text message.

“Marina suggested to convene a joint meeting of the DTI and Marina, and to include the Philippine Ports Authority (PPA), since most of the charges are related to PPA. There are no other updates,” he added.

Marina has yet to respond to BusinessMirror’s request for comments.

Economy

Friday, September 25, 2015

BusinessMirror

A5

Solon pushing for 5% income tax on P20,500 monthly pay

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espite the apparent aversion of Malacañang to tax measures that could slash government revenues, a lawmaker filed a proposal that would allow employees earning as much as P20,500 monthly to pay only a 5-percent income tax.

House Bill (HB) 6120, filed by Rep. Paolo S. Javier of the Lone District of Antique, raises the ceiling for the income that would be slapped a 5-percent tax to P20,500 from the current P10,000.

“The country’s individual income taxpayers have lamentably suffered inequity on account of the tax system’s inability to keep up with rising inflation rates for quite sometime. Considering this unfair situation, it is just timely that individual income taxation be fixed to make it once more equitable,” said Javier, who is also assistant majority leader.

Since the effectivity of the National Internal Revenue Code (NIRC) of 1997 on January 1, 1998, Javier said the individual income-tax rates have remained based on the 1998 Consumer Price Index.

“This means that a working man’s monthly pay of P10,000 back in 1998

is now equivalent to P20,500, which should just be entirely taxed at the rate of 5 percent instead of a higher rate,” he said.

Javier said the tax on a salary of P20,500 should be P1,025 and not P1,550, leaving a worker with an additional monthly take-home pay of P525 or P6,300 more disposable income on a yearly basis.

HB 6120 also provides that not later three years after the effectivity of the proposed measure, and every three years thereafter, each net taxable income level and normal tax rate herein stated shall be adjusted to its present value using the Consumer Price Index published by the Philippine Statistics Authority.

Meanwhile, Party-list Rep. Neri Colmenares of Bayan Muna said proposed tax reforms could most likely be passed in Congress in the next few months, as lawmakers bolt from the ruling Liberal Party

‘Free and open trade should benefit small businesses’

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he benefits of free and open trade should trickle down to micro, small and medium enterprises (MSMEs) to ensure that the objectives of job creation, wealth generation with equity and wider access to the opportunities of global trade are realized.

Doris Magsaysay-Ho, 2015 chairman of the AsiaPacific Economic Cooperation (Apec) Business Advisory Council (Abac), said Apec’s priorities include embracing e-commerce to accelerate MSMEs’ access to international markets; promoting innovation and its participation in the global value chain; and promoting and ensuring MSME access to finance and affordable credit.

The Asia-Pacific region is projected to capture 33.4-percent share of global e-commerce sales by end-2015 according to a research by eMarketer.

“These upward regional and global e-commerce trends present great opportunities for Msmes to expand their market base, widen their business networks, and increase their sales toward sustained growth,” Magsaysay-Ho said.

“We need to leverage on the growing Internet usage, burgeoning middle class, and the increasing accessibility and affordability of technology to enable our micro, small, and medium enterprises to enter the global market. E-Commerce has evolved into a regular marketplace option for many buyers,” she added.

A study conducted by Abac with the USC Marshall School this year disclosed that the “most critical” limiting factor that hinders their capability to engage in e-commerce is the lack of readiness and capability.

Problems of awareness, technical ability, access to talent and financing all limit the potential of MSMEs, especially in developing economies.

“For cross-border e-commerce to grow, e-payment solutions must expand beyond traditional banking solutions.

Governments must allow for new, innovative e-payments solutions and avoid the vested interests of incumbents,” Magsaysay-Ho said.

“We need an ecosystem that supports enterprise creation and increases innovation capabilities of Msmes,” she added.

MSMEs account for over 97 percent of all enterprises and employ over half of the work force across Apec economies. Small businesses contribute significantly to economic growth, with MSMEs’ share of gross domestic product ranging from 20 percent to 50 percent in the majority of Apec economies.

The Nanjing Declaration on promoting Sme Innovative Development was adopted in 2014 which urged the Apec members to take a range of measures to promote Sme innovation on a voluntary basis.

An important measure that is relevant to the innovation agenda is that of strengthening the digital infrastructure and leveraging the digital economy to accelerate MSMEs’ participation in the global value chains. Recto Mercene

in the run-up to the presidential elections next year.

Colmenares said the sway of Malacañang over the votes of the Liberal Party congressmen and senators is waning, as party members look for which candidate to support for president in the next elections.

“I think there is still a chance because the President does not have that kind of influence anymore among his party mates and there is clamor from the people to pass these reforms,” Colmenares said in his recent speech at the general membership meeting of the Tax Management Association of the Philippines (TMAP).

TMAP is spearheading the campaign of business chambers, groups of employers and employees to push for the adjusting of the income-tax brackets and the lowering of the income-tax rates to arrive at a progressive system of taxation.

Colmenares said there is no real opposition from congressmen and senators, since the proposed tax reforms are very popular among the poor and the middle class.

“Nobody is categorically declaring that he will oppose this,” he said.

He said that the only real opposition against the bill comes from the President himself, who has recently declared that the proposed adjusting of the tax brackets is not good for the economy at this time. Rea Cu and David Cagahastian

PHL vows to reduce carbon footprint

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he Philippines will submit by the end of the month its Intended Nationally Determined Contributions (INDC) in support of a legally binding agreement among heads of state during the forthcoming 21st Session of the Conference of the Parties to the United Nations Framework Convention on Climate Change (COP21) in Paris, France, this December.

“Even if our contribution [greenhouse gas] is small, we will still submit our INDC,” Secretary Lucille Sering, vice chairman of the Climate Change Commission (CCC), said.

Sering said the country’s submission of INDC will show that the country is determined to reduce its carbon footprint and help in the global effort to reduce greenhouse-gas emissions, which scientists said led to climate change.

“We want to show that even if our contribution is small we are willing to shift to environment-friendly production,” she added.

Sering was among the guests during the media launch of the COP21: The Road to Paris Starts in Manila organized by the Embassy of France to the Philippines last Thursday to drumbeat the forthcoming UN climate meeting.

The weeklong activities involving various non-governmental organizations, experts, students, artists and members of academe will highlight the role of civil-society organizations in pushing for a legally binding agreement to fight global warming and climate change.

French Embassy Deputy Head of Mission Laurent Legodec led the media launch together with Assistant Secretary Sixto Dantes, more popularly known as actor Dingdong Dantes, representing the National Youth Commission (NYC); singer Noel Cabangon who is also vice president of the group Dakila; and Kim Atienza, ABS-CBN’s weather anchor.

Also called “Climate Week”, the holding of the weeklong event takes inspiration from the Manila Call to Action on Climate Change, an appeal directed to the international community to cooperate in addressing climate change and to support the conclusion of an ambitious universal and legally binding agreement to limit global warming to below 2 degrees during the COP21 meeting.

The Climate Week signals the start of a massive awareness campaign to be launched by the Embassy of France to the Philippines, the CCC and NYC, to involve various stakeholders in the Philippines in the discussions leading to COP21.

France, which will be hosting COP21, is responsible for facilitating negotiations and consultations between governments and stakeholders in preparation for the conference.

Through Climate Week, Legodec said they hope to encourage discussions among various stakeholders and rally support behind a legally binding agreement that will mitigate climate change.

It will be recalled that the Manila Call to Action on Climate Change was launched by French President François Hollande together with President Aquino at the Malacañang Palace Grounds during his state visit to the country on February 26.

“When President Hollande and President Aquino launched the Manila Call to Action in February, we recognized this as the start of the road to Paris, toward a better and more sustainable planet for future generations,” Legodec said.

Regardless of race, religion or generation, he said climate change affects all people.

“This is why our conclusion of this climate agreement should not only in the hands of heads of state and policy-makers. Everyone should do their part in raising awareness and contributing to discussions on the climate, and a large part of this lies with civil society,” he said.

Dantes lauded the initiative of the French Embassy to the Philippines, underscoring the urgent need to act together, including the Filipino youth, to fight climate change, starting with raising their consciousness on climate issues.

“There is an urgent need to make the youth realize the importance of their commitment, cooperation and active participation in promoting a climate-resilient lifestyle and to understand the salient points of the Philippine position on the call to climate action,” Dantes says.

Atienza for his part said as weatherman for ABS-CBN for more than 10 years, he bear witness to the dramatic change in the country’s weather patterns brought about by climate change.

“In 2004 we only experience typhoons moving as fast as 140 kilometers per hour. Lately typhoons are becoming stronger, moving at 200 kph. The last time, we had typhoons threatening to hit the country at 275 kph, equivalent to Category 5 hurricane. Luckily, it was dissolved,” he said.

A resident of Malate, he also said that he witnessed how climate change has caused severe flooding in their community. “Before, flooding in our area is knee-deep. Lately, it has reached waist-deep. I fear that in 10 years, flooding will be permanent in our community because the flood is aggravated by saltwater. The sea level is rising,” he said. Jonathan L. Mayuga

A6 Friday, September 25, 2015

Opinion BusinessMirror

editorial

Disaster on Samal Island

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he kidnapping of three foreign nationals and a Filipina from a high-end resort on Samal Island in Davao is a disaster for the Philippines.

The reputation that a country has around the world is like trust in a personal relationship. No matter how good things have been going, one incident of breaking that trust causes damage that can take years to rebuild. Former Tourism Secretary Richard Gordon said: “This [the attack on Samal Island] will undermine all our gains in promoting the Philippines as a tourism destination.”

The Philippines has suffered in three ways. This event takes the Philippines back to the general perception by some of being a “Third World Hellhole,” a phrase popular in the 1970s to describe lawless nations. The Philippines has not been able to adequately subdue—even after decades of various schemes— insurgent bandits that have proven they can operate relatively freely. The Philippine government is unable to insure a climate of safety and order for its people and visitors.

A comment by Philippine National Police Director General Ricardo Marquez may be accurate but is not reassuring to other countries. He said, “I think it’s clear [the kidnappings were] an isolated case. There is no trend of its happening in several parts of the country.”

The Canadian government said it has no nationwide advisory for the Philippines but it also said, “Bombings, shootings and kidnappings have occurred on public transportation, at airports, in shopping malls and in other public areas.

Foreigners and places frequented by foreigners have been targeted. Explosive devices continue to be discovered by security authorities.”

Comments coming from President Aquino are not reassuring and may even make the perceptions worse. Translated from Filipino, “From the initial reports, it seems that this could be a new group. Of course, the intelligence services will take this into account. Why was this not on the radar? Or maybe this group was just newly formed.”

The president went on to say: “Even the motivation behind it is not clear.

What is their purpose behind their kidnapping?” We have now told the world that the government has no idea who is behind the kidnappings and that we have no idea why the foreigners were kidnapped.

Will this give foreigners and their governments confidence that the Philippine government can protect tourists?

Chief Supt. Ferdinand Dulay, head of the Special Investigating Task Group Ocean View, said: “They [the troops] are in hot pursuit.” Capt. Alberto Caber, spokesman for the Armed Forces’ Eastern Mindanao Command, said the Air Force has also mounted regular sorties on the seas off Southern Mindanao, including the waters off Sulu and Basilan.

But as of now, the kidnappers have escaped.

We have full confidence in our police and military to do the best job that they can. However, something is obviously deficient in the government’s policy on actions that put the country on the front page of the global press for the wrong reason.

Rethinking a political ad ban James Jimenez

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spox

verswing: the human tendency to overcorrect; to go to the extreme opposite of an act or a circumstance perceived to be wrong or harmful. The sad thing is, sometimes the overswing turns out to be just as unfavorable as the wrong sought to be corrected.

Take this talk about reestablishing a ban on political campaigning.

While I am thankful that former Sen. Richard Gordon is supportive of the Commission on Elections’s (Comelec) push to hold presidential debates, I’m afraid his position on banning political campaign advertisements entirely needs to be examined more thoroughly.

The Comelec has no official stand on this idea either way. While the electoral management body can, of course, recommend such a move, to do so would mean flying in the face of the fact that Republic Act 9006 was enacted precisely to end a similar ban, and that a recent Supreme Court decision unequivocally came down on the side of giving more leeway to political advertising, rather than less. To overturn that weight of authority would require better justifications than simply being reactive to the deluge of political ads we are currently living with now.

Admittedly, the idea of having no

political ads holds a certain attraction, but the mere fact that it would be tantamount to content-based restriction, automatically sets it on a collision course with constitutionally guaranteed rights.

Still, even leaving aside free-speech arguments, such as those expressed in GMA v. Comelec (G.R. 205357, 2 September 2014), there are still some not-insignificant—and perhaps more practical— considerations that need to be sorted out.

First off, it should be noted that, as annoying as these ads have become, they do perform an important function. They present aspects of the candidates that cannot be gleaned from a simple recitation of their positions on issues. These ads provide the voters a means, however imperfectly, to assess the character and personality of a candidate. Granted, candidates do tend to exaggerate the good and largely ignore the bad, but to ban ads simply out of fear that voters will be too stupid to tell the difference simply doesn’t wash. People in general might not

have the time or inclination to do deep dives into policy papers or investigative reports, but they are not ignorant of the fundamentals of politics.

So, when political ads are banned, the public is deprived of this resource and of the chance to make decisions for themselves. Instead, they are forced to rely on the media.

Unfortunately, for all its strengths, the media remains an inadequate conduit for political discussions, for the simple reason that it isn’t designed to be a pipeline for unfiltered information.

Because of the limitations of the medium, politicians typically get less than a minute to deal with issues. Not enough time, you say? Well, yes.

Thus, a vast majority of the information people will get from the media will simply be remixes and riffs on these sound bites, flowing through the filters of editorial bias, commentator predispositions and just general punditry.

There will be precious little depth to the discussion and worse, the question of which issues gain prominence—and are consequently talked about at length— will basically be decided by editorial fiat.

To say that the public will benefit more from the supposedly informed opinions of talking heads not only goes back to the obnoxious notion that people are too dim to come up with their own judgements but also essentially reduces the electorate to voting almost exclusively on issues presented to them by the media. All other issues, regardless of significance, risk falling by the wayside.

Sure politicians can always resort to more traditional means of campaigning,

but in a country of more than 50 million voters, distributed unevenly over more than 7,000 islands, how can any politician hope to connect in any significant way to more than just a handful of voters? Without political campaign ads, about the only way to ensure that the message reaches its intended audience is to rely on positive media coverage.

Given this situation, it isn’t difficult to foresee a situation where political operatives and the media might enter into an overly cozy relationship, cultivated by largesse. Which brings me to the often repeated argument that a political ad ban will drive down the cost of elections: it won’t. Costs won’t go down. They will simply go underground.

Worse, unless the industry definition of what constitutes newsworthiness changes in a hurry, gimmickry and buffoonery will become the easiest means of getting on the evening news, and ergo, into the public consciousness. Needless to say, this will not elevate the level of electoral maturity.

Like I said: overswing. The proposed ban is an extreme reaction to a perceived problem—the ridiculous proliferation of campaign ads. But while a ban would drastically reduce the number of ads the vexed and inconvenienced public will be subjected to in the short term, it will also set in motion a string of consequences that, in the long run, might be more harmful to elections than the offended sensibilities of some.

James Arthur B. Jimenez is director of the Commission on Elections’s education and information department.

Opinion BusinessMirror

opinion@businessmirror.com.ph

The economic ruins of martial law Leonardo A. Lanzona Jr.

EAGLE WATCH

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he persisting agony faced by President Ferdinand E. Marcos during martial law was the legitimacy of his brutal and corrupt regime. In the process, a number of legal measures were established, including the formation of local community units, later called barangays, which became the venue of the ratification of his self-serving 1972 Philippine Constitution.

However, as Marcos very well knew, the only justification for the imposition of martial law was the success of the economy.

Indeed, he was trading off basic human rights for economic gains in order to justify his hold on power.

For instance, in the labor sector, Marcos decreed the “restructuring” of all unions on an industry-specific basis, and then affiliated these to a single national trade-union confederation. Consequently, the martial-law regime prohibited strikes in so-called vital industries, such as public utilities, transportation, communication, oil refining and distribution, banking, hospitals, schools, and vaguely defined “companies engaged in the production or processing of essential commodities for export.” In November 1975 Marcos decided to pursue further the emasculation of labor unions by preventing strikes altogether “during the period of national emergency.”

In agriculture, a massive distribution of government funds for agricultural credit (a program called Masagana 99) was established to promote the planting of high-yielding rice varieties and to support land reform by providing substitutes for landlord-credit sources. More than P1 billion in loans had been disbursed by the end of 1974 through rural banks and the Philippine National Bank. But, despite some initial success, the program failed due to a rapid rise in delinquent borrowers. This was attributed to an inability to pay on the part of many farmers and some resistance on the part of others, compounded by inefficient and sometimes dishonest administration. By 1976 the nonrepayment had become so serious as to threaten the stability of nearly half of the rural banks. In the end, the courts, the police and the military were used with to coerce and force farmers to pay.

Despite all of the posturing on discipline and strong leadership, the Marcos era was an economic failure. The Philippines, during the period, became one of the heaviest borrower-countries in the world.

Much of the money was spent on pump-priming to improve infrastructure and promote tourism.

Yet, the Philippines lagged behind its Southeast Asian counterparts in gross domestic product growthrate per capita. While the country, from 1970 to 1980, registered an average 3.4-percent growth; Thailand, Malaysia, Singapore and Indonesia recorded higher growth rates with a mean of 5.4 percent.

Even with its lack of discipline and limited “powers,” administrations after martial law clearly registered better economic performances. The current Aquino administration, for one, has managed one of the highest growth rates in Asia today at roughly 6 percent.

Furthermore, the unemployment rate rose from 5.2 percent to 5.9 percent from 1978 to 1983, while underemployment was an even larger problem, tripling, in the same time period, from 10.2 percent to 29.0 percent. With a greater labor force, the country today has an unemployment rate of around 7 percent, but the quality of jobs is better, with underemployment down to 18 percent.

The transition to a centralized government with the imposition of martial law in 1972 made it easier for the government to spend for capital outlays using foreign money.

During this period, foreign borrowing was the main mode of financ-

Despite all of the posturing on discipline and strong leadership, the Marcos era was an economic failure. The Philippines, during the period, became one of the heaviest borrower-countries in the world. Much of the money was spent on pump-priming to improve infrastructure and promote tourism. Yet, the country lagged behind its neighbors in Southeast Asia in gross domestic product growth-rate per capita. ing public investment. Because of this, the decade of the 1970s was described as the period of “debtdriven growth.” The debts were not only derived from multilateral sources but, starting in the middle of the decade, from foreign banks awash with “petrodollars” incurred not only by central government, but also public and private corporations run by people close to Marcos.

With the increasing debts, more funds were placed in low-productivity investment and “white elephants,” as limited structural transformation took place. In the 1970s one sees an inconsistent implementation of an outward-looking strategy, combining export promotion with the protection of economic sectors run by Marcos associates.

In fact, cronies close to the Marcos regime obtained significant incentives and favors but were not subject to any sort of discipline and threat of punishment. Thus, income inequality grew during the era of martial law, as the poorest 60 percent of the nation were able to receive only 22.5 percent of the income in 1980, down from 25.0 percent in 1970.

The richest 10 percent, meanwhile, took a larger share of the income at 41.7 percent in 1980, up from 37.1 percent in 1970.

The common thread underlying the policies on agriculture, labor and finance is the false belief that individual welfare can be sacrificed in favor of what Marcos saw was the social good, i.e., the economy. The trampling of human rights in the political arena was very consistent with this economic strategy. As evidenced in the martial-law period, such a strategy is not sustainable and is clearly just a camouflage to the widespread looting that occurred at the top.

Of course, it is more than just economics. The psychological trauma of the families who suffered under martial law continues to this day, and people associated with Marcos or adhere to his principles remain in power. As we struggle to mold and nourish our democracy, we should continue to speak for the truth about martial law that harshly snatched democracy away from us. As we progress, we must remember the men and women who offered their lives so that we can recover it. In this way, we can actively censure these criminal transgressions committed purportedly in the name of economic prosperity.

We can then truthfully commit to protect the rights and interests of the individual.

Friday, September 25, 2015 A7

Nabunturan and films from the valley Tito Genova Valiente

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T was a place far off. You sensed the distance when mountains and hills appeared so close, they felt like they were hugging the road. The name of the place where we were going—Nabunturan —to meant that, a place bounded by mountains.

That morning of the 18th of September, we flew from Manila to Davao upon the invitation of the Nabunturan Independent Film Exhibition (Nabifilmex) through its festival director, lawyer Karen Santiago-Malaki.

The festival is on its third year and is supported by the Municipal Tourism Council of Nabunturan. Arts and culture, two fields that are not usually priorities of local government units, are the central concern of the town and this festival, that brings independent films to the masses.

When we arrived that Friday, the sky was overcast and soon the rains came. The weather had been the problem of the organizers but the people, we were informed, came and stayed with their umbrellas.

An open-air cinema is the main feature of the festival, with the inflatable screen enabling images in good resolutions.

We saw this interest in films, indie films and not mainstream films, by the people of Nabunturan during the awards night. The rain started to fall in the late afternoon, and we were hoping it would stop by 7 in the evening. But the rain became even stronger. We were about to give up having the awarding in the town plaza, but Karen was not keen about transferring the event to another venue. At about 8 in the evening, the rain was reduced to trickles, and we all proceeded to the plaza. Tents were hoisted near the stage and people were huddling under them. When the rain stopped, more people standing around the park joined the throng.

Honored that night were films from Calabarzon and films earlier shown in the Cinema Rehiyon held in Cebu in August this year. One film is titled Wawa, and is directed

by Anj Macalanda. The film abstracts the landscape that serves as backdrop for a boy’s journey to bring his

father to his final resting place. The river, the forest and the mountains are captured by Arnel Barbarona, cinematographer, and renders the rhythm of the film. Poetic, but not sentimental, the film seems to breathe its own music, the images are measured to move from one feeling to another, each atmosphere shading the plot into an end that is not an end, but a tremor about how we humans are guided by the quiet of our heart.

Two short films from Nabifilmex took my breath away. One is called Supot and the other Tamiaw. The filmmakers are Department of Education teachers from the neighboring town of Monkayo. They are, according to Karen, products of the Sine Indie Film Workshop conducted before.

The short film Supot shows a

young man doing something in a bathroom. Whatever it was, it was not making him comfortable. The scene shows the man going out of the room to welcome the children to the classroom. He would conduct the class. But he would go to the bathroom again and fix something with his body. Finally, the camera goes down and shows what it was that gave him pain. He was fitting into a tube a plastic sheet that would collect his bodily waste. Months back, the man was knifed and this was the result.

In that final scene, he grimaces and squirms. But as soon as he is able to arrange his shirt, he goes out. With a huge, warm smile on his face, he welcomes the children back to the classroom, like any regular teacher.

The other film, Tamiaw, which, following the multiawarded filmmaker Arnel Mardoquio, means “absolute serenity,” is the story of a lumad mother and her little boy experiencing government aid. The mother goes to an automated teller machine and faces up to how the literate people will treat her. Even the tricycle driver charges her too much. The final scene shows her paying her debt to the sari-sari store owner.

Both films are winners for their candor and sincerity, which makes their politics gripping. These two films do not have the pretension of

many filmmakers based in big cities. Do not call these films raw and crude; that is the bias of Western critics who always claim sophistication as benchmark for their own, while films from the periphery always owe their charms to their unfinished appearance.

There are other winners in Nabunturan. These are the people who have the mind to try other new “art” forms, like indie films. Reel and real are not dichotomized in Nabunturan. Art remains long but not exotic, because even the rain could not stop the townsmen from being film viewers. There are the other winners, the young men and women who run the event. Karen is helped by her husband, Rocky Malaki, who is a lawyer-filmmaker. Bryan Gimenez played a crucial role in the festival.

Mardoquio served as mentor to many filmmakers, even as he continues to document the Mindanao that, I always say, we do not know and, perhaps, will never know.

The National Commission for Culture and the Arts provided a significant fund to enable Nabunturan to be a major film festival while remaining at the periphery and serve as the lesson for the triumph of the local.

E-mail: titovaliente@yahoo.com

How smog cops busted Volkswagen and brought down its CEO

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By Dana Hull and Mark Niquette | Bloomberg View

he revelation that ended Martin Winterkorn’s career at Volkswagen AG came on September 3 in a meeting at an office park east of Los Angeles.

After months of obfuscation, company engineers finally divulged a secret to engineers at the California Environmental Protection Agency’s (EPA) Air Resources Board (CARB): Volkswagen had installed a “defeat device” to cheat on vehicle emissions tests—and then lied about it to the board and the US EPA for more than a year.

On September 23 Europe’s largest automaker announced that Winterkorn, its 68-year-old CEO, had resigned. While the company exonerated him of involvement in the manipulations, it said it will conduct an internal investigation and has asked local German prosecutors to assist and open a criminal probe.

The unraveling began in 2013. European regulators, concerned about diesel pollution there, wanted to test emissions on vehicles sold in the US under actual driving conditions. The results were expected to show real-world emissions were closer to lab performance in America than in Europe. But they weren’t. That prompted investigations in California that ultimately involved 25 technicians working almost full time. They discovered the software Volkswagen used to circumvent air-pollution regulations in at least 11 million cars.

who founded the Center for Alternative Fuels, Engines and Emissions at West Virginia University.

The nonprofit International Council on Clean Transportation, with offices in Washington, Berlin and San Francisco, got the emissions-testing contract from European regulators. It then hired researchers at the Morgantown, West Virginia, center in early 2013. The center, which has studied engine emissions and use of alternative fuels since 1989, was going to evaluate three diesel passenger cars, including a Volkswagen Passat and Jetta.

“We never went into it saying, ‘we’re going to catch a manufacturer,”’ said Arvind Thiruvengadam, a research assistant professor at the center. “We were totally looking and hoping to see something different.”

The researchers first contacted Volkswagen and other manufacturers to help get vehicles and inform them about the tests, said Daniel Carder, director of the center. The companies weren’t interested in participating, so the center rented a privately owned Passat and Jetta in Los Angeles and a BMW X5 from an agency in San Jose for testing from March through May in 2013, Thiruvengadam said.

Serious problem

Driving to Seattle

“This is going to become a very, very serious problem for Volkswagen and any other companies that may have had such practices,” said Donald W. Lyons,

Using portable measuring equipment with hoses attached to vehicle exhaust pipes, researchers drove the Jetta and BMW through Los Angeles and took

the Passat to Seattle and back. They also worked with the CARB’s laboratory in El Monte, which tested the cars on a dynamometer, a device that measures engine performance.

When the Volkswagen cars were in the lab, they met the Clean Air Act standards. In the real world they were belching out oxides of nitrogen at much higher levels than allowed.

“There was a lot of texting and emailing back and forth,” among the two groups: “‘Whoa, things aren’t looking good here,”’ Carder said.

In May 2014 the West Virginia center published the results of its study, prompting the California board to start an investigation.

“We try to have these issues dealt with at the technical level, not the political level, as much as we can,” Mary Nichols, the board’s chairman, said in a telephone interview. “What we do here at the lab is not just certify new vehicles. We are always looking for ways that we can make our emissions standards more effective.”

Alarming discrepancies The board’s technical staff spent months meeting with Volkswagen engineers about the alarming discrepancies.

In December Volkswagen voluntarily recalled about 500,000 cars, saying this would take care of the problem. When the CARB ran tests to confirm the fix, little had changed.

Staff at the board kept pressing Volkswagen for answers; the company said they must have run the tests wrong or their instruments weren’t calibrated correctly. Puzzled and perplexed, the technicians went back to the lab and the road, double checking and rerunning

everything. But the results were the same.

Over the summer Volkswagen revealed how its TDI engine operated and how its pollution controls worked, but that still didn’t explain the strange anomalies.

“We had 10 meetings with VW,” Stanley Young, a spokesman for the board, said in an interview at the El Monte lab.

“Time and again they refused to tell us what was going on.”

Some two dozen board staffers were working almost full time on the VW problem. Mystified as to how the results could be so different, they began digging into the data stored on the cars’ computers.

They found the vehicles were running cleaner when they were cold than when warm, the exact opposite of what typically happens.

Sophisticated algorithm They eventually discovered Volkswagen had installed a sophisticated software algorithm in the engine-control module of cars from 2009 to 2015. It could sense when the vehicles were not on the emission-test cycle based on indicators, such as movement in the steering wheel.

“When the computer realized it was off the test cycle, it went into the realworld mode, where the pollution controls weren’t as effective,” Young said.

“There was a ‘second routine’—the dirtier routine.”

After stonewalling the CARB for nine meetings, senior Volkswagen engineers finally “fessed up” on September 3, Young said. “It was impossible for them to explain why the car was running more clean when it was cold. It was an accumulation of evidence and data that we’d assembled and they literally ran out of excuses.”