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n Sunday, February 8, 2015 Vol. 10 No. 122
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Balisacan says PHL should steer away from booms or busts week ahead
ECONOMIC DATA PREVIEW n Foreign exchange: The local currency traded sideways still within the lower band of the 44 territory in the previous week, starting off with a depreciation at the beginning of the week. The local currency hit 44.16 to a dollar on Monday. This appreciated sideways on Tuesday and Wednesday to hit 44.135 and 44.11 to a dollar, respectively. The dollar gained strength in the latter part of the week to hit 44.14 on Thursday and end the week at 44.15, a depreciation of the peso compared to the 44.08 to a dollar value in the previous week’s end. The total traded volume during the week is at $3.152 billion. n Week ahead: Traders say the market is still on the lookout for data, more important from the euro zone and guidance on the US’ moves for its upcoming normalization for this year. Market players also set their sights on the Bangko Sentral ng Pilipinas’s policy decision on Thursday, which most people expect will keep the status quo.
February 12, Thursday Monetary-Policy Stance Decision
n Previous monetary-policy meeting: The Monetary Board (MB) decided to retain all its monetary tools in its last meeting for 2014, on the back of a steady inflation outlook on the policy horizon. In particular, the overnight borrowing, or reverse repurchase rate, still stands at 4 percent, while the overnight lending, or repurchase rate, is at 6 percent. The special deposits account rate is still at 2.5 percent, and the reserve requirement ratio is also at 21 percent at the end of 2014. The MB’s
See “Outlook,” A2
‘Rebalance growth drivers’ These experts know T exactly where oil By Bianca Cuaresma
HE country’s growth drivers must be rebalanced in order to sustain the strong growth momentum that the Philippines is seeing today, and to protect the quality of economic expansion from so-called booms and busts—or the sudden rise and fall of growth in the country—a Cabinet secretary said.
prices are headed Diesel fuel-storage silos stand at the Thames Oil Port Project, a joint venture operated by Royal Vopak NV, Royal Dutch Shell Plc. and Greenergy International Ltd., in Thurrock, United Kingdom, on January 28. Chris Ratcliffe/Bloomberg
Construction is seen to have a much larger share to the economy in the next year due to the projects in line from the government and the private sector, as well. Investments, however, still lag.
Speaking before regional journalists at the Asia-Pacific Economic Cooperation seminar, hosted by the Embassy of the United States, Socioeconomic Planning Secretary Arsenio M. Balisacan said the country must take opportunity of the current strength it is showing in improving other sectors that can
contribute more to growth. “We need to rebalance the economy, and look for other sources of growth. The capacity of the economy to generate more quality jobs would be very much limited [if we don’t rebalance],” Balisacan said. Continued on A2
US urges resolution of economic issues to hike foreign investments
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GOLDBERG: “Everybody praises the Filipino work force. So, that is a real asset of attracting foreign investments.”
HE United States urged the country to resolve economic issues to expand the inflow of foreign direct investments (FDI) further, and be able to keep up with its peer countries. At a news conference, US Ambassador to the Philippines Philip Goldberg said the country still has a lot of potential to grow these long-term investments from foreign investors, as it resolves several structural issues that are deemed by investors as barriers to their interests.
PESO exchange rates n US 44.1290
Among the sectors that Goldberg mentioned were the equityownership issues, opening the economy more and the several economic-reform bills still pending in the Senate. Goldberg also said the legal framework in settling business disputes must be improved, as this is one of the concerns of foreign investors interested to place their capital in the Philippines. “These are barriers to their interest. Now with the Philippines See “Investments,” A2
T
he outlook on oil prices is clear: Oil will crash. Unless prices surge. Definitely, one or the other.
Crude just had the biggest two-week gain in 17 years, but it’s still about 50-percent cheaper than it was in June. The situation is volatile, and forecasts are all over the place—from $30 a barrel predicted by the president of Goldman Sachs to as high as $200 a barrel seen by the head of the Organization of the Petroleum Exporting Countries (Opec). So what’s going to happen next? Here’s a sampling of predictions from the last two weeks: Oil could fall as low as $30, because supply surpluses won’t disappear overnight, Barclays Plc. analyst Miswin Mahesh said. Oil has the potential to climb to $200 per barrel, from See “Oil,” A2
n japan 0.3755 n UK 67.6851 n HK 5.6929 n CHINA 7.0583 n singapore 32.8365 n australia 34.3952 n EU 50.6733 n SAUDI arabia 11.7593 Source: BSP (6 February 2015)
News
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A2 Sunday, February 8, 2015
Outlook...
Oil...
‘Rebalance growth drivers’
continued from A1
decision is based on its assessment that the inflation environment continues to be more manageable, with the risks to the inflation remaining broadly balanced over the policy horizon.
Continued from A1
n Upcoming decision: Economists agree that the central bank will likely hold the rates on Thursday on the back of stable inflation and to support the country’s growth for the year. However, the BSP is still seen to return to its tightening bias toward the latter part of the year in anticipation of the normalization of the US Federal Reserve’s interest rates. “Even with most global central banks easing, the Fed is poised to hike rates and if they do, [the] BSP will need to adjust policy as well once again to help stabilize the financial system and also to promote price stability,” Bank of the Philippine Islands economist Nicholas Mapa said in a previous interview with the BusinessM irror . Bianca Cuaresma
He explained that the rebalancing that the country needs is one that is different from the rebalancing seen in other parts of the world. “What the country needs is a contrast of rebalancing with neighbors; the rebalancing that they are talking about is moving from too much dependence on exports and investments. In China, for example, much of the growth was coming from investments and exports, only 40 percent was from domestic consumption,” Balisacan said. He added that the Philippines, on the other hand, depended much on the BALISACAN: “We have depended so much on the domestic market in terms of its growth domestic front. The problem driver in the past years. is that the domestic front is “We have depended so much on the a very limited market. We domestic front. The problem is that the need a much bigger market.” domestic front is a very limited market. We need a much bigger market,” Balisacan said. In particular, Balisacan said the Philippines needs to get more investments as complementary sources of growth. Other areas that the secretary is looking on further room for improvement is exports and trade. “You need this for high-quality jobs. Investment has to grow, construction has to grow. Exports have to grow increasingly more important,” Balisacan stressed. Although the Philippines needs more push, Balisacan said that they are already starting to push for the diversification of growth so that there will be no more busts in the economy as seen in the past. He said that construction is seen to have a much larger share to the economy in the next year due to the projects in line from the government and the private sector, as well. Investments, however, still lag. The Philippine economy grew by 6.9 percent in the last quarter of the year, rebounding from the disappointing 5.3-percent growth in the third quarter of 2014. This cemented the annual growth in 2014 at 6.1 percent.
Investments... continued from A1
growing at 6.1 percent, and the prospects of growth are good for this year, investors are at the door and they want to see the details,” Goldberg said. “Those are the kinds of issues that they are looking at,” he added. The US ambassador said what investors are looking forward to in the Philippines, aside from its good macroeconomic story, is the proficiency of the labor force in the country. “Everybody praises the Filipino work force. So, that is a real asset of attracting foreign investments,” he said. Latest data from the central bank showed that FDI in the country hit $5.32 billion in the first 10 months of 2014. This is 64.1 percent higher than the $3.24 billion seen in the same period in 2013. However, the Philippines still is the smallest recipient of FDI at the end of the third quarter last year compared to its peer countries. Bianca Cuaresma
FEBRUARY 8, 2015 | SUNDAY
Northeast Monsoon locally known as “Amihan”. It affects the eastern portions of the country. It is cold and dry; characterized by widespread cloudiness with rain showers.
continued from A1
a lack of investment in new supply, warned Opec’s Secretary-General Abdell El-Badri. “If you don’t invest in oil and gas, you will see more than $200,” he said, without giving a time frame. Shale oil will soon be needed to make up for production declines around the world, pushing US prices to as high as $65 a barrel, the head of Astenbeck Capital Management wrote in a February 2 letter obtained by Bloomberg News. In a Bloomberg News survey of analysts and traders, 12 of 32 respondents predicted futures will decline through February 13, while 10 forecast an increase. “We don’t think we’ve seen the bottom yet,” said Giovanni Staunovo, a commodities analyst at UBS in Zurich.
Tsuneishi...
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“We are establishing a bottom,” said Bill O’Grady, chief market strategist at Confluence Investment Management in Saint Louis, which oversees $2.4 billion. “In the long run, probably $60 is going to be your pivot point.” Oil will probably continue to decline and could reach as low as $30 a barrel, said Gary Cohn, president of Goldman Sachs Group Inc. “We’re probably in the lower, longer view,” said Cohn, a former oil trader. “The fundamental supply and demand does remind me of 1986 a bit, where we could go into a period in this decade of lower oil prices,” said BP CEO Bob Dudley. Prices may stay below $60 for as long as three years, he said. “It will be a long time before we see $100 again.” Oil could fall to the $30 a barrel range, said Fumiya
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build ships that are competitive in quality, price, delivery lead time and an eco-friendly performance,” said Akihiko Mishima, THICI new president. “We are building Tsuneishi flagship products, and, therefore, we are united to deliver excellent ships. Tsuneishi Heavy Industries has maintained, and always will have ‘only the best, world-class Tsuneishi quality,’” he added. Started in 1994, THICI is a joint venture between Tsuneishi Group and Aboitiz Group. Its shipyard in Cebu has an area of around 1.47 million square meters—with main facilities, including two building slipways, one building dock and two 1,300-ton floating cranes, among others.
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Manned by 13,000 workers, it builds ships of up to 200 meters long, with either 58,000 tons or 82,000 tons. The shipbuilder delivers bulk, pure car and truck-carrier vessel types to Europe, Hong Kong, Japan, Singapore and Taiwan. In two decades, it has already delivered 191 ships—including 20 ships delivered in 2014— with revenue of ¥600 billion, or around P250 billion. Total accumulated investment in its 20 years of operations has reached up to ¥70 billion. With the upcoming deliveries this year, thus so far bringing the total shipment volume to 209, THICI continues to be one of the top shipbuilders in the world.
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Kokubu, CEO of Tokyo-based Marubeni Corp. He said he doesn’t see much of a price rebound in the next two or three years. What’s an investor to think? In 2015 the average price is likely to be anywhere from $35 to $80, according to a Bloomberg Intelligence survey of 86 investment specialists. That’s a pretty big range. To be fair, some of the forecasts above aren’t mutually exclusive. Some analysts think prices could drop further and then skyrocket once production dries up or there’s a rebound in global demand, especially from China. But the timing of a lasting turnaround in oil prices is murky at best. The only thing that’s certain is more uncertainty. Probably.
continued from A8
The shipbuilder already delivered two vessels last month—an 82,000-D/W-MT-type Kamsarmax bulk carrier, SC-226 MV Capricorn Trader; and a 58,000-D/W-MT-type Handymax bulk carrier, SC-231 MV Kellet Island, respectively. The latter is en route to Hong Kong, while the former is bound to Singapore for bunkering, then cargo loading in Australia. Both ships are Japanese-owned. Meanwhile, THICI’s first “eco-ship,” called TESS58 Aeroline, SC-220, which is a 58,000-D/WMT-type bulk carrier that features higher fuel-efficiency design, is expected to be delivered in March. “Our shipbuilding business, led by Tsuneishi Shipbuilding, is continuously seeking for ways to
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Binay to Purisima: Why did it take you 12 days to quit?
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By Recto Mercene
ICE President Jejomar Binay on Saturday expressed dissatisfaction that former national police chief Alan Purisima waited for 12 days after the Mamasapano massacre before he tendered his resignation. “Former National Police Chief Alan Purisima made the nation wait for 12 days. Almost two weeks had passed before he decided to speak up. And, when he did, it was only to deny his participation in the planning and implementation of the operation in Mamasapano, Maguindanao, on January 25,” Binay said in a statement. “It would have been better had he clarified his involvement in Mamasapano at the outset. And, if he did not commit any transgression as he claims, then why did he resign his post?” Binay said Purisima’s pronouncements contradict those of the former Special Action Force commander and other sources, who claim that Purisima was heavily involved in the planning and implementation of the operation even though he was suspended during that time. “There are also questions regarding the status of Purisima now that he had resigned. It should be clarified and emphasized that he resigned his post as chief of the national police and not as a member of the police
force since this is not allowed by the law because of a pending complaint against him,” Binay said. “One of the penalties imposed by law on government employees is the forfeiture of their benefits from the government. Thus, it should be clarified and emphasized that, as long as the investigation is ongoing, Purisima should not be allowed to claim his benefits,” Binay added. “What Purisima said—and didn’t say—has only stoked the fears of our countrymen that the coverup of the truth may have begun. It further underscores the need to create an independent fact-finding commission.” Several investigations are set to be conducted in the coming days, such as those by the Senate, the Lower House, Board of Inquiry and the Moro Islamic Liberation Front. On the other hand, there are many quarters calling for the creation of a truth commission, composed of persons of know probity and integrity. There are suggestions that this commission must never include any politician. “In the absence of an independent fact-finding commission created by law, it is incumbent on all Filipinos to closely monitor the proceedings to ensure that they are transparent, fair and nonpartisan even if the main person involved is a close friend of the President,” Binay said.
Indon president due for state visit
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RESIDENT Joko Widodo of Indonesia is scheduled to make a state visit to the Philippines from February 8 to 10, upon the invitation of President Aquino. The Department of Foreign Affairs (DFA) said this is the first time for Widodo to visit the Philippines since he assumed the presidency in Indonesia. In the spirit of Association of Southeast Asian Nations (Asean) solidarity, it is a tradition on the part of a new head of state to immediately conduct introductory visits to fellow Asean heads of state, the DFA said. Widodo assumed the presidency of Indonesia on October 20, 2014. He is currently on a three-country swing, which has taken him on state visits to Malaysia and Brunei Darussalam, with the Philippines being his final stop.
Widodo will meet with Mr. Aquino to discuss matters of mutual concern, including migrant workers issues, maritime cooperation, defense, trade and investment and people-topeople exchanges, among others, the DFA added. Indonesia was the Philippines’s 11th-largest trading partner in 2013, with total trade amounting to $3.62 billion. The Philippines and Indonesia enjoy excellent bilateral relations and cooperate extensively in numerous areas. The two countries recently signed the landmark Agreement Concerning the Delimitation of the Exclusive Economic Zone Boundary, on May 23, 2014, effectively clarifying the maritime boundary between Southern Mindanao and North Sulawesi in Indonesia. Recto Mercene
Sunday, February 8, 2015 A3
DOTC blamed anew for MRT-3 mess
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By Lorenz S. Marasigan
HE Department of Transportation and Communications (DOTC) should have addressed the persisting problems of the Metro Rail Transit (MRT) Line 3 last year, when train experts from Hong Kong declared that the mass-transit system already poses certain threats to the commuting public.
Instead of shrugging off the report made by MTR Corp. Ltd., which runs Hong Kong’s train system, the government should have taken major actions to mitigate the “alarming state” of the railway line, MRT Holdings II Inc. (MRTH II) Chairman Robert L. Sobrepeña said. “The top priority continues to be the safety issues that should have been resolved months ago,” he said, referring to the November 6 report submitted by MTR Hong Kong the MRT’s private owner. In a 169-page report, nine train experts said the transport facility, which ferries half a million passengers a day, is already exhibiting signs of obsolescence. It even warned of a possible derailment that could cause “substantial casualties in a high-usage system, like the MRT 3.” The glaring defects are obvious, passengers would complain, while riding the train system. A normal day at the MRT would mean kilometric lines, starting from entering the station to queuing up to enter the coaches. Elevators and escalators are either broken or under repair. Train operations are frequently stalling: Either due to a technical problem with the train cars in front, or the rails are broken, or the very coach that one is in is malfunctioning. Last week passengers complained of long queues as the train line de-
ployed only 12 train sets out of 20, causing delays. Some passengers were even asked to pay the corresponding “overtime charge” for staying beyond the allowable time at the train system. These things happen, passengers complain, despite the higher fares that the MRT now charges. Ticket prices almost doubled from P15 for an end-to-end ride to P28. Hence, Sobrepeña said, it is high-time that the government fast-track the rehabilitation of the train system. “Fast-track rehab is key and foremost. It must be done to assure safety of the riding public and to restore the MRT 3. Once the fast-tracked rehab is done by a credible company with proven track record and financial capacity, then the MRT 3 can operate at its original capacity again and the long lines at stations will be greatly minimized,” he said. Currently, the government is rolling out a P9.7-billion multiyear venture to overhaul the line. The complete makeover is expected to be done within the term of President Aquino. It includes the procurement of additional train coaches, general overhauling of trains, ancillary systems upgrade, platform edge doorstep, signaling system upgrade, rail
steel replacement, communications system upgrade, traction motors replacement, and the improvement of the overhead catenary system. The rehabilitation venture also includes security fence and noise barrier, consulting services, upgrade of conveyance facilities, a footbridge for the North Avenue Station, weatherprotection cladding, Internet connection, passenger information system and passenger hand straps. A number of these projects, including the procurement of rails, have been awarded. “The rehabilitation and proper maintenance of the system cannot wait. We must take any and all steps needed to restore the system to make it safe and reliable for the riding public,” Sobrepeña said. However, it seems that no reputable railway-upkeep contractor is keen on maintaining the dilapidated line. The two auctions for the P2.38billion MRT-maintenance contract were snubbed by railway companies, despite a sweeter deal. Multinational and local companies, like Busan Transport Corp., Mosan-Inekon Phils Ltd. Co., SMRT International Pte. Ltd., Miescorrail Inc., and D.M. Consunji Inc. backed out from the first tender, while none of them even expressed their interest in a much better upkeep deal. Railway expert Rene S. Santiago explained that maintenance providers were spooked by the lack of transparency as to the real state of the train line, saying that, prima facie, the audit made by MTR Hong Kong was accurate. In order to address the problems of the MRT, the government intends to buyout the corporate owner of the line, the MRT Corp., a wholly owned subsidiary of MRTH II. The government aims to completely take over the line by the time President Aquino steps down from office in 2016. But recent delays, including the “tying up of loose ends,” are forcing the government to double its efforts to effect the buyout. One of the requirements to execute the takeover is for the gov-
ernment to strike up a compromise deal with the private owner of the train line. This would effectively end the ongoing arbitration case in Singapore that was lodged against the government in 2008 due to its failure, as the operator of the line, to pay billions of equity-rentals payment to the owner of the rail system. Should the buyout be completed in 2016, the transportation agency may then bid out the operations and maintenance contract of the line, thereby tapping private-sector efficiency and customer-service orientation for operational needs, while retaining regulatory functions for passenger protection with government. On the other hand, the local flagship of Hong Kong-based conglomerate First Pacific Co. Ltd. is proposing to shoulder the upgrade costs of the train system and free the government from paying billions of pesos in equity-rental payments. Metro Pacific Investments Corp. President Jose Maria K. Lim said his group intends to spend $524-million to overhaul the line. The group of businessman Manuel V. Pangilinan earlier entered into a partnership agreement with the corporate owner of the MRT, a move that would have allowed the conglomerate to invest roughly $600 million to improve the services of the train system. The venture would effectively expand the capacity of the railway system by adding more coaches to each train, allowing it to carry more cars at faster intervals. The multimilliondollar expansion plan would double the capacity of the line to 700,000 passengers a day from the current 350,000 passengers daily. It was submitted in 2011, but the transportation agency’s chief back then rejected the proposal. The MRT 3 has been operating at overcapacity since 2004. Currently, the line serves nearly 550,000 passengers per day, it even reached, at one point last year, the 650,000-daily passenger mark. It has a rated capacity of 350,000 daily passengers.
National plebiscite needed for BBL–Atienza
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bullhead No, this not a depiction of animal cruelty. A Baguio City man arranges a pile of carabao heads complete with long horns carved
in hardwood. The heads will be used to decorate the exterior of a soon to open restaurant in the summer capital catering to tourists and upland visitors. Mau Victa
Comelec reinstates Aquino cousin as Paniqui mayor
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LARK FREEPORT—The Commission on Elections (Comelec) has declared declared Mayor Miguel “Dors” Cojuangco Rivilla as the duly elected mayor of Paniqui, Tarlac, in an en banc decision on February 2, upholding the November 12, 2014, resolution of its First Division. The Comelec en banc resolution also reinstated Rivilla, a maternal cousin of President Aquino, and finally resolved the legal claim to the mayorship of Nationalist People’s Coalition candidate Rommel David, who is, as of press time, is still functioning as the mayor of Paniqui, pending the release of the writ of execution that will enforce the poll body’s en banc resolution. During the media forum “Balitaan,” organized by the Capampangan in Media Inc. in cooperation
with the Clark Development Corp. and the Social Security System at the Bale Balita here, Rivilla said he expects to reassume his post next month, after the one month reglementary period from the date of the en banc resolution had lapsed. The 12-page en banc resolution certified by then-Comelec Chairman Sixto Brillantes Jr., noted that, in the 2013 elections, Rivilla garnered 22,909 votes, as against the 19,676 votes of rival Rommel David. The poll body said that, in September 2013, Judge Serafin Cruz of the Regional Trial Court (RTC) in Paniqui had already junked the electoral protest of David. Despite this, David filed in October of that year yet another motion for reconsideration, this time before the sala of another RTC judge, Agapito
Laoagan Jr., a judge assigned in Benguet, who was appointed as “assisting judge” in Paniqui. Laoagan acted favorably on David’s petition, which led to a recount of ballots that invalidated more than 3,000 votes in favor of Rivilla, thus enabling David to assume the mayoral post late last year amid tension at the town hall. Rivilla and David traded motions for reconsideration that led the Comelec to issue a status quo order in December in favor of David, pending the resolution of the case filed by Rivilla against David and Laoagan. In its en banc resolution, the Comelec noted that the earlier decision of Cruz was already “final and immutable” and all orders and decisions of the RTC from the time of the order dated June 6, 2013, are “null and void.” Ashley Manabat
PART Y-LIST lawmaker over the weekend pushed for a national plebiscite should the proposed Bangsamoro basic law (BBL) be approved by Congress. Party-list Rep. Lito Atienza of Buhay said the BBL affects the whole country, not only the Autonomous Region in Muslim Mindanao (ARMM). “If ever the BBL passes through Congress, then it should go through a national plebiscite and not just a plebiscite within the Mindanao area,” Atienza said. “The BBL, together with all the crucial issues and concerns being raised about it, affects the whole country, not just Mindanao,” he added. The Moro Islamic Liberation Front (MILF) is currently engaged in peace talks with the government, which is geared at creating a Bangsamoro political entity that will replace the ARMM through the BBL, which has yet to be approved by Congress. Atienza added that as it is now, the ad hoc committee chairman, Puwersa ng Masang Pilipino Rep. Rufus Rodriguez of Cagayan de Oro, said only those areas covered by the BBL shall be included in the plebiscite. “One concrete example of this is the share in national income that will be allotted for the BBL. Under the proposed BBL, a block grant equivalent to 4 percent of the net internal revenue of the Bureau of Internal Revenue minus the internal revenue allotments of local governments, shall be automatically appropriated to the Bangsamoro region yearly. We should ask our fellow Filipinos if they agree with this since it will be coming from the taxes they are paying. This directly affects all of us, not just the Filipinos in the area,” Atienza said. The annual block grant will not undergo a Congressional scrutiny under the proposed BBL. “And, more important, if the BBL is finally passed by Congress, it is practically amending the Constitution. So the whole nation should vote on it in order to comply
with the Constitutional requirements. It will go against the Constitution if the plebiscite is limited only to the area,” Atienza said. Earlier, Speaker Feliciano Belmonte Jr. admitted that support for the passage of the BBL has been eroded because of the Mamasapano clash between national police commandos and Moro rebels that killed 44 members of the government force. The SAF members were on a mission to get Afghanistantrained bomb-makers Zulkipli bin Hir, alias Marwan, and his cohort Abdul Basit Usman. Marwan, a Jema’ah Islamiyah operative, is considered Southeast Asia’s most-wanted terrorist. Jovee Marie N. dela Cruz
A4
P-NOY55th Birthday A BusinessMirror Special Feature
Sunday, February 8, 2015
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Keeping the trust, staying on the right path
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By Leony R. Garcia
ung walang corrupt, walang mahirap.” The voting public must have loved this quote, the campaign slogan of then-Senators Benigno “Noynoy” Aquino III and Manuel Roxas II, who ran for the Philippine government’s leadership in the 2010 elections.
This five-word slogan has earned the people’s trust and renewed their hope for reforms in governance. Coupled with then revitalized “yellow fever” brought about by the death of former President Corazon C. Aquino, Noynoy eventually became the 15th President of the Republic. As expected, a sea of yellow-clad supporters witnessed the inauguration of Noynoy, the son of democracy icons Corazon and Benigno “Ninoy” Aquino Jr., at the historic Quirino Grandstand in Manila at 12 noon of June 30, 2010. Mr. Aquino took his oath before Supreme Court Associate Justice Conchita Carpio-Morales. President Aquino had been serving as senator since 2007 before he was ushered into the presidential race following the death of his mother. During his campaign, he vowed to eradicate corrupt practices that triggered several scandals during the previous administration. In his inaugural speech rendered mostly in Filipino, Mr. Aquino vowed to “end bad governance” and set an example in getting rid of corruption in public administration. He said his campaign slogan of “Kung walang corrupt, walang mahirap” was not only “pang-slogan o pang-poster” but would serve as the basis of the Aquino administration. “Sisikapin kong maging isang mabuting ehemplo,” he said. In January 2011, the corruption slogan won the Gold Standard Award for Political Communications in the PublicAffairsAsia, a network of senior government relations, public affairs and corporate communications professionals operating across the Asia-Pacific region. The Philippine President received the award in Hong Kong over the Minister Mentor and first Prime Minister of Singapore Lee Kuan Yew, India’s Minister of Information and Broadcasting Ambika Soni, British Prime
Minister David Cameron, Asean Secretary-General Dr. Surin Pitsuwan, and Indonesian Politician Anas Urbaningrum. PublicAffairsAsia Executive Director Craig Hoy said: “These awards celebrate the achievements of corporations, governments and NGO’s [non-governmental organization] and identify those professionals, consultancies and governmental figures who are driving this important process of engagement and partnership in Asia Pacific.”
His path to presidency
The official web site of the President, http://president.gov.ph, said that the 15th President of the Republic of the Philippines has come to stand for Filipinos’ reinvigorated passion to build a nation of justice, peace and inclusive progress. In 1998 President Aquino entered public service to make sure that the democracy his parents fought for would bring changes in people’s lives. He served as representative of the Second District of Tarlac from 1998 to 2007. In May 2007, he joined the Philippine Senate, wherein he worked to bring about legislative initiatives anchored on the protection of human rights, and honest and responsible governance. His mother’s death in 2009 prompted mourning from all over the country. It also awakened a remembrance of the values she stood for and stirred up the people’s yearning for a leadership that is honest and compassionate, and a nation that trusts and works with its government. Immediately after her wake, people began to call on President Aquino, urging him to run for presidency in the 2010 elections to continue his parents’ work. Signature drives and an outpouring of support through yellow ribbons and stickers went full blast, convincing him to run. Moreover, candidates for president, such
as Roxas, Pampanga Gov. Eddie Panlilio, and Isabela Gov. Grace Padaca gave up their presidential aspirations to support Mr. Aquino. After a spiritual retreat at the Carmellite Monastery in Zamboanga City, President Aquino responded to the call to make the people’s passion for change the driving force behind a new government. On September 9, 2009, the 40th day after Cory’s passing, he officially announced his candidacy for president at the Club Filipino in Greenhills, San Juan—where his mother took oath on the final day of the Edsa People Power Revolution. “I want to make democracy work not just for the rich and well connected but for everybody,” he said. On June 9, 2010, the Congress of the Philippines proclaimed Mr. Aquino as the president elect of the Philippines. In his inaugural address, he told the Filipino people: “We are here to serve, and not to lord over you. The mandate given to me was one of change. I accept your marching orders to transform our government from one that is self-serving to one that works for the welfare of the nation.”
‘Tayo na sa matuwid na landas.’
Most everyone else sweated it out at the Luneta Park, braving the early-morning rain and the sweltering heat that followed on the President’s inaugural. Thousands of people, most of them clad in the Aquinos’ signature yellow color, stood in front of the Quirino Grandstand and cheered every word the new President uttered. “Kayo ang boss ko, kaya’t hindi maaaring hindi ako makinig sa mga utos ninyo. We will design and implement an interaction and feedback mechanism that can effectively respond to the people’s needs and aspirations,” he said.
‘Tayo na sa matuwid na landas,’ he concluded his speech.
With the recent challenges in the presidency and leadership of President Aquino, his “bosses,” supporters and non-supporters alike eagerly await for the fulfillment of the promise for the right and straight path. “My hope is that when I leave office, everyone can say that we have traveled far on the right path, and that we are able to bequeath a better future to the next generation. Join me in continuing this fight for change,” President Aquino’s official biography said. The BusinessMirror joins the nation in greeting Aquino on this special day. Happy birthday, Mr. President!
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editorial
Job creation in the age of technology
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OB creation is posing a crucial challenge to policy-makers here and in other parts of the world. Efforts to create jobs must come to grips with what can be called the emerging technological age. The new technological age, simply described, has a strong bias against simple labor and in favor of higher quality labor. In the data analysis and word processing field alone, a few computers now do the work of vast accounting and secretarial departments. The availability of various computer-assisted designs now requires a smaller number of assistants. Taking down stenographic notes by secretaries now seems no longer necessary as office heads prefer to write down their letters directly with the use of the computer. Even more pronounced is the change in the communications field. The mobile phone has replaced legions of telephone operators and telegram transmitters, not to mention unwieldy telephone boards and the clutters of wires that accompany telephone and telegraph connections. Prominently noticeable is the birth of so-called business-process outsourcing (BPO), for the preparation of business correspondence, medical transcription, sometimes scientific research work—an affirmation, incidentally, of good old Ricardian comparative advantage. There is now an increasing array of activities done “online”— banking and marketing activities, especially. Changes in ways of doing things are taking place in less conspicuous ways in other sectors of the economy. One characteristic of many of these activities is that they can be done at home, especially those in the BPO fields. The phenomenon of people doing office work at their individual residences is common these days. Another characteristic: many of these activities are gender-neutral. Who cares whether the medical transcriber is a male or a female? In the medical field the assumption that the doctor is a male and the nurse a female has been stood on its head. Understandably, these technological changes are giving rise to demands for a different kind of labor. Required now are information-technology trained individuals capable of turning in solid performance in the new fields. What is the significance of all this to policy-makers in and out of the government? It is that jobs of the old technology, once lost, are lost forever. They may reappear but now require new skills, which means laid-off workers may reclaim their jobs only if they have upgraded their training. Of course, truly new jobs will appear, reflective of the technical requirements of the new age. The response will obviously have to be aimed at the provision of the appropriate supply of labor. Concretely this will require the exposure and training of workers and workers-to-be in the new talents and skills required by the technologically oriented economy. The new K to 12 educational program and Technical Education and Skills Development Authority type of technological training seem appropriate to the new circumstances. Nothing in this overview of developments implies any downgrading of the importance of investment in the generation of employment. Investment is an indispensable factor in the production process. Without it one has to think of production processes as they were prior to the Industrial Revolution. Employment generation, never an easy matter even in favorable circumstances, can be accelerated if employment policies factor in the features of the new technological age.
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Sunday, February 8, 2015
HE exact moment of any corporate turnaround is almost impossible to pinpoint. But if Sony’s latest numbers truly do signal the revival of the Japanese icon—the company just posted its best quarterly profit in seven years—then the transformation may have begun last April, when Kenichiro Yoshida was promoted to CFO. It’s probably best not to get too carried away by today’s numbers, which prompted an 18-percent surge in Sony stock, the biggest intraday gain in nearly a decade. If I had ¥100 for every time an analyst declared the tech giant was “back” over the last 15 years, I’d be retiring early. But bullish projections of a $171- million operating profit for the year suggest there’s a chance posterity may one day view Yoshida and Sony CEO Kazuo Hirai as the tag-team that resurrected one of Japan’s most fabled names. How have they done it? While Hirai smartly boosted investments in the company’s unglamorous chip unit to build more modules for phones, tablet computers and automobiles, Yoshida began the hard work of cutting off a number of dead limbs within the sprawling company. Yoshida got Sony out of the moneylosing personal computer business and prompted a shock $1.7-billion writedown in smartphone operations that at the time enraged investors. He nimbly harnessed the weak yen to maximize profits in segments that rely on domestic production. Also, he was instrumental in stemming the bleeding from last year’s cyberattack disaster. In the three months ended December 31, prelimi-
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It’s probably best not to get too carried away by today’s numbers, which prompted an 18-percent surge in Sony stock, the biggest intraday gain in nearly a decade. If I had ¥100 for every time an analyst declared the tech giant was “back” over the last 15 years, I’d be retiring early. But bullish projections of a $171- million operating profit for the year suggest there’s a chance posterity may one day view Yoshida and Sony CEO Kazuo Hirai as the tag-team that resurrected one of Japan’s most fabled names. nary operating income more than doubled to $1.5 billion, the highest since the same period of 2007. Above all, Yoshida instilled a new realism at Sony, which long strove to sell consumers every possible gadget in their homes. The Sony of tomorrow is one that focuses on what it does well: entertainment, its PlayStation network and its devices unit, which supplies the image sensors that go into cameras on its Xperia smartphones and Apple’s iPhones. (Those humble sensors contributed greatly to this week’s earnings surprise.) Largely thanks to Yoshida’s practicality, the focus at Sony can now begin to shift from cost-cutting and cyberattacks to what’s next. But here’s where deep questions remain. Today’s stock surge shows how hungry investors have been for any sign of good news at Sony. As I and many others have written before, though,
nd immediately He left the synagogue, and entered the house of Simon and Andrew, with James and John. Now Simon’s motherin-law lay sick with a fever, and immediately they told Him of her. And He came and took her by the hand and lifted her up, and the fever left her; and she served them. That evening, at sundown, they brought to Him all who were sick or possessed with demons. And the whole city was gathered together about the door. And He healed many who were sick with
the company still lacks a gamechanging invention that can truly unlock growth—another Walkman. Fourteen years on, Sony has yet to come up with a globally viable answer to the iPod, never mind an iPhone like those Apple sold at a rate of 30,000 per hour last quarter. As its PlayStation 4 wins over gamers, Sony is hoping to establish a lucrative, Apple-like ecosystem built around the technology. The idea is to steadily upgrade the physical console and get fans to sign up for the PlayStation Network services, which includes games, music and movies, thus, creating a loyal community of customers who will make continuous contributions to the bottom line. But this iTunes model ultimately won’t work unless Sony can come up with splashy new hardware that appeals to consumers more broadly, growing its franchise beyond game enthusiasts. Sony sold a respectable 6.4 million PS4’s between October and December, but there’s a limit to growth in an age when smartphones and tablets dominate. And Sony’s phones are hardly in Apple’s league. Hirai, in other words, is still facing the same creative void that comedian Mike Myers recently mocked on Saturday Night Live. While Yoshida has stabilized the company and positioned it for new growth, the onus falls on Hirai to transform Sony more fundamentally: dismantling a too-hierarchical corporate structure where good ideas go to die and empowering in-house designers to invent breakthrough products. The new realism at Sony is welcome. A true revival, though, is going to require inspiration.
various diseases, and cast out many demons; and He would not permit the demons to speak, because they knew Him. And in the morning, a great while before day, He rose and went out to a lonely place, and there He prayed. And Simon and those who were with Him pursued Him, and they found Him and said to Him, “Every one is searching for You.” And He said to them, “Let us go on to the next towns, that I may preach there also; for that is why I came out.” And He went throughout all Galilee, preaching in their synagogues and casting out demons.— Mark 1:29-39
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opinion@businessmirror.com.ph • Sunday, February 8, 2015 A7
Good priests W Free Fire
By Teddy Locsin Jr.
E have had good priests at Rockwell. We have a new one. He is marvelous. He has gone back to bedrock Christian belief without which you cannot call yourself a Christian. He spoke of two things mostly forgotten by Christians. The first is that fervor need not be noisy. At one of the noisiest parts of the Mass, he silenced the choir and enjoined communion in silence with God. Silence is the only language we share with Him; none of us speaks Aramaic—the only language God spoke aside from maybe Hebrew on Sinai. But there were no witnesses except Moses himself. Well, who knows? Even Brian Williams made up that story of being in a chopper crash. The second is a reality insistently denied by the West: Satan, Lucifer
the Prince of Light and now the Lord of Darkness. True, Satan—it is pretentious to say, The Satan, so I will not—was decisively defeated in the battle of Calvary, where Jesus defeated Satan’s principal weaponry: lies about his guilt of blasphemy—it isn’t blasphemy when You are talking about Yourself; when You are God claiming the things that pertain only to God. And murder. You know the jig: Satan is the father of lies and a murderer. But Satan, like some people in the south, won’t admit he has been conquered. Following his defeat, he was gone into low-intensity warfare and waged insurgencies. The best way to lose a war is not to believe in the enemy. In the Vietnam War, the US did not take the Khmer Rouge seriously. It didn’t have Soviet and
Chinese support; it was a completely homegrown affair. The result: Cambodia fell ahead of Saigon. The war in heaven is over, but it continues on earth. The battlefields are the bodies and souls of men and the devil is more real than a Republican antipoverty program. And, yet, in his seven years studying theology in the US or, for that matter, in Rome, our new priest said he had never been assigned any readings on Satan nor was the Lord of Darkness ever talked about. The War in Heaven, aside from being the title of the best novel written by Charles Williams—is found in Persian mythology but Satan is not a myth, our new priest insisted, but a reality. It was as if the leading theologians in the US didn’t believe Satan
existed; possibly Satan was just a literary device to encapsulate the evil of men and the misfortunes inflicted by nature. Not surprisingly, he said, the two places where Satanism is most widely practiced is San Francisco and New York. Well, I am not so sure about that, because those are my favorite places on earth. And I have never been so fervent at Mass than in New York, in a large mostly empty cathedral where the extras in Broadway musicals volunteer their voices in the choir. It is a gay congregation and much the better for that. Indeed, sightings of Satan everywhere else in the world number far more than those of Elvis leaving a building in the US. The most recent sightings of Satan and his cohorts are in Syria, where he emerged as
a sexual predator of children in the guise of freedom fighters supported by the West in its desire to topple Assad so a pipeline can be built across what would then be the Israeli protectorate of Syria to the Mediterranean, and thereby end Europe’s dependence on Russian oil. Satan was earlier sighted in Rwanda and in the former Yugoslavia. He opened a front under Boko Haram in Africa and another in southern Philippines—with regard to which the priest asked us to pray for the widows and orphans of the SAF 44, who gave their lives so that we may worship our Lord in a church and not on our knees upon a carpet with a knife at our throats as we say our last prayers. But only Deles and Ferrer know more about that than anyone else.
Sorry, millennials, we’re out of the jobs you want By Megan McArdle Bloomberg View
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ILLENNIALS don’t want to work in sales, reports the Wall Street Journal. They think it’s exploitative. They also hate the idea of variable compensation; they want a nice, steady job where the company takes the risk, not the worker. The feeling that sales is exploitative is not new; people have always been uncomfortable with the idea of selling something or being sold. And, of course, many people have always been uncomfortable with the idea of variable compensation. But if companies are having a harder time finding people to take sales jobs and reworking compensation packages to decrease the commission component, that is worth noting. It’s not entirely surprising, of course. I’ve heard people who worked in New York City’s government during the 1970s noting that there was an unusually high number of very competent senior staff at the time —refugees from the Great Depression who ended up there because it was the only place where you could get a steady paycheck. That generation was risk-averse in ways that their children were not, with a high savings rate and a permanent
aversion to equity investments. It would be natural for the millennial generation to have had a similar reaction to such a brutal formative experience. Unfortunately, as Farhad Manjoo noted last week, they may be coming of age at a moment when the economy is moving toward more variable work, not less. Uber and similar services are making it relatively easy to employ people in a high-tech version of piecework: discrete tasks that are parceled out moment by moment, entirely contingent on demand. Robert Reich thinks this is terrible. If the Journal’s article is any guide, it’s not what the new generation of entering workers wants. But it may be what’s available. In some sense, the 9-to-5 salaried position is an artifact of the industrial era. Such jobs existed before then, of course, in government offices and large institutions. But most jobs were much less defined. Armies of people worked for themselves, as farmers or traders or craftsmen, working only when there was demand and making only whatever profit they could eke out from their sales. Others were domestic servants, who had a steady salary but no steady hours. Economies of scale created a lot of work doing routinized tasks
that needed to be planned well in advance. The easiest way to coordinate this was to have set shifts of workers who showed up at the same time every day, prepared to do the same thing. The conversion of a huge fraction of the work force to this sort of employment was a major revolution in human affairs. After two centuries, however, it seems natural. Technology is making it much easier to do things on a smaller scale. It has taken over the coordination tasks that, say, brick-and-mortar stores and regular shifts once served. That’s a great economic advance in many ways—there were a lot of inefficiencies baked into those old systems. But it does mean that workers are going to be exposed to a lot more variability in their income than most of them were raised to expect. Some of that will simply arise from the fact that piecework systems give greater rewards to the most productive workers, so there is greater variance in what different workers make for doing the same job. And some of it comes from more direct exposure to the market. Firms insulate us from variations in our own performance—if you have a bad day, your colleagues pick up some slack, and vice versa, so that your income is smoothed out. Firms
Refugees from the Great Depression was risk-averse in ways that their children were not, with a high savings rate and a permanent aversion to equity investments. It would be natural for the millennial generation to have had a similar reaction to such a brutal formative experience. Unfortunately, as Farhad Manjoo noted last week, they may be coming of age at a moment when the economy is moving toward more variable work, not less. also insulate us from fluctuations in market demand; when it’s a rainy day at the store and no one comes in, the workers still get paid. As workers get disaggregated, they’ll need to learn to do the things that employers once did for them, such as accumulate “rainy-day funds” to carry them through down cycles. Before we get too sad about this change, it’s worth remembering what we hated about the old system. There’s a lot of nostalgia about those lifetime jobs with generous benefits, but when we had them, writers spent a lot of time bemoaning the soul-
deadening nature of all that rote work, each person just a tiny cog in a huge machine. Task work carries more risk, but it also offers more autonomy and a direct connection between the work you do and the customers you’re helping. Obviously, I’m not saying that sewing pieces for pennies is better than being a corporate VP. But that’s because it’s miserable, lowpaid work, not because working inside a huge corporation is obviously superior to being out on your own. There’s no particular reason that task work has to be badly paid; it just was in the industrial era, because people who did task work were doing low-productivity jobs that didn’t benefit from the enormous economies of scale that, say, an auto plant enjoyed. As those economies of scale have eroded, thanks to automation and trade, we shouldn’t necessarily think that those differentials will persist. Whether task work is satisfying and well-paid depends not on Uber’s software, but overall demand: how much will people pay for tasks, and how many unemployed people are around willing to take those tasks on. That’s what should worry millennials, not whether 50 percent or 55 percent of their pay consists of a base salary.
Collaborative cybersecurity action needed to help thwart attacks By Robert E. Stroud TNS Forum
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RESIDENT Barack Obama’s c a l l for le g i s l at ion t o strengthen cybersecurity may be one of the few points in his State of the Union address that has some bipartisan support, according to the morning-after pundits and analysts. And it should because the threats are real and imminent. The president urged Congress to pass legislation that will improve digital protection. Earlier this month he also announced revisions to previously proposed legislation that would give companies legal protections for sharing information with the government about cyberthreats. Steps such have support from the industry, and policy-makers in Congress should act quickly to address the growing risks. Any signals of bipartisan support are good news, given the immense threat that delay represents. As recent high-profile attacks have demonstrated, weak cybersecurity is an
imminent threat to government, business and societal interests around the world. Almost half (46 percent) of those polled recently by global cybersecurity and information technology (IT) association Isaca expect their organizations to face a cyber-attack this year, and almost all (83 percent) view cyber-attacks as one of the top three threats to business. If the numbers aren’t convincing, consider the words in the 2015 World Economic Forum (WEF) report, which calls threats to cybersecurity among the world’s most severe and imminent risks: “Once the genie is out of the bottle, the possibility exists of undesirable applications or effects that could not be anticipated at the time of invention. Some of these risks could be existential—that is, endangering the future of human life.” Unfortunately, the genie is out of the bottle and, with or without action from Congress and the Obama administration, these vulnerabilities will only grow. The WEF’s dark warning stems from the realities of today’s hyperconnectivity—the
If the numbers aren’t convincing, consider the words in the 2015 World Economic Forum report, which calls threats to cybersecurity among the world’s most severe and imminent risks: “Once the genie is out of the bottle, the possibility exists of undesirable applications or effects that could not be anticipated at the time of invention. Some of these risks could be existential—that is, endangering the future of human life.” so-called Internet of Things. Computer networks are at risk of increasingly complex and sophisticated attacks, and so, too, is any physical device with embedded intelligence, from power transmission lines, transportation and communications systems, or literally any type of infrastructure or industrial process. Cyber-attacks are part of the new
reality. They are an immediate and severe threat to governments, organizations and individuals—and even to the halls of Congress. In his State of the Union speech, Obama sought support for the legislation, saying he wants to improve and streamline the ways businesses and government work together, to unify the reporting of cyber-attacks into a central repository. Some Republicans suggested support for this idea, which has backing from the IT industry. Collaborative discussion for increased cyber protection is an important step in the right direction. But the discussion must lead to action. Leaders must agree quickly on clear, straightforward cybersecurity action that can help thwart these potentially devastating attacks. At the same time, the need to balance the privacy rights of individual citizens is critical, which means we need a thoughtful, collaborative approach. In addition, the Obama administration, Congress and the industry should explore programs to build up the front-line defenders—the skilled
IT workers—who can help detect and respond to cyber-attacks, and build in security from the beginning. They are in alarmingly short supply. A stunning 86 percent of those polled by Isaca acknowledge a worldwide shortage of cybersecurity professionals. Our association is working to develop cybersecurity professionals and their organizations through the training, education and credentialing offered through Isaca’s Cybersecurity Nexus, but cybersecurity is a global risk that demands a fully collaborative response from government and industry. “If we don’t act, we’ll leave our nation and our economy vulnerable,” Obama said. “If we do, we can continue to protect the technologies that have unleashed untold opportunities for people around the globe.” We need to continue making it possible for technology to create opportunity—through thoughtful, collaborative efforts by Congress and the Obama administration and close coordination between government and industry.
2nd Front Page BusinessMirror
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Sunday, February 8, 2015
Belmonte tells House members: Speed up Cha-cha deliberations
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By Jovee Marie N. dela Cruz
OUSE Speaker Feliciano Belmonte Jr. has instructed members of the lower chamber to fast-track floor deliberations of the measure amending the economic provisions of the 1987 Constitution.
Belmonte said that Resolution of Both Houses (RBH) 1, or the proposed amendments to the economic provisions of the Constitution, should be passed before the sine die adjournment on June 12 to incorporate a plebiscite for Charter change (Cha-cha) with the 2016 national and local elections. “We will fast-track the deliberation, so the plebiscite for it will be done alongside with the 2016 national and local elections,” he said. Belmonte added that the government may hold the plebiscite for Cha-cha alongside the 2016 national elections, instead of spending for a separate poll, which, he said, needs at least P7 billion to P8 billion.
“We might have [a] difficult time to get these several billions necessary for the plebiscite. The plebiscite is the crucial thing for economic Cha-cha,” Belmonte said. He also said that many Filipino voters participate during presidential elections. According to the Commission on Elections (Comelec), the highest turnout of voting population participating in a particular election is during the presidential elections. On the other hand, the Comelec has said that, without a joint resolution approved by Congress, it is not possible to put a rider question in the 2016 ballot on changing the Constitution.
Belmonte, however, said that he is willing to file a resolution allowing the plebiscite alongside the 2016 national and local elections. The resolution, filed by Belmonte and Sen. Ralph Recto, is eyeing to amend economic provisions on the 60-40 rule that limits foreign ownership of certain activities in the Philippines. The resolution will include the phrase “unless provided by law” in the foreign-ownership provision of the Constitution, particularly land ownership, public utilities, natural resources, media and advertising industries. Under Article XII of the Constitution, foreign investors are prohibited to own more than 40 percent of real properties and businesses, while they are totally restricted to exploit natural resources and own any company in the media industry. The amendments to the Charter will be approved through separate votings by both Chambers, with a three-fourths vote required from them. Moreover, Belmonte reiterated that the Cha-cha move will be a larger contributor to economic growth, as foreign direct investments are seen to increase once ownership on estates and corporations—one of the issues raised by
investors for not investing in the country—is relaxed. The Joint Foreign Chamber of Commerce and Philippine business groups already expressed support for the passage of the economic Cha-cha. In an earlier interview, House Majority Leader and Mandaluyong City Rep. Neptali Gonzales II said that RBH 1 should be passed into a law before Congress’s sine die adjournment in June this year, because “the month of August is for the annual budget deliberations, while the remaining months are for the campaign period [for 2016 national elections], so we expect the lack of quorum.” He said Belmonte’s economic Cha-cha remains as one of the top priorities of the lower chamber. But he admitted that Belmonte’s economic Cha-cha is a legislative priority of the House, “that it is not yet a legislative priority of the Senate.”
www.businessmirror.com.ph
Tsuneishi ship delivery to reach 209 this year
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By Roderick L. Abad
SUNEISHI Heavy Industries (Cebu) Inc. (THICI) is set to deliver 18 ships this year, surpassing the 200-mark shipment since it started operating in 1994. These include three deadweight (D/W) 35,300-metricton (MT) type; seven D/W 58,000-MT type, of which three are TESS58 Aeroline; seven D/W 82,000-MT Kamsarmax type; and one D/W 180,000-MT cape-size bulk carrier. See “Tsuneishi,” A2
Workers walk along a pier at the Tsuneishi shipyard following a ceremony to launch a bulk carrier in Cebu in this June 19, 2012, file photo. Bloomberg
Globe aims for P100-B revenue in 2015 By Lorenz S. Marasigan
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LOBE Telecom Inc. will end the year with at least P100 billion in revenues, senior officials said, as the company beefs up its core businesses, banking on its multimillion-dollar datainfrastructure modernization program for 2015. Officials of the Ayala-led company made this fearless forecast before a concert hall packed with journalists and bloggers on Thursday evening, a few hours after the company disclosed its full-year financial statement that showed the company grew by 25 percent in terms of net profit in 2014. “Globe will be a P100-billion revenue company by 2015,” Globe President Ernest L. Cu said during the media briefing for the company’s newest partnership with a video-streaming provider based in Singapore. Albert M. de Larazzabal, the treasurer and chief financial officer of Globe, separately said that the projected growth will be driven mainly by the company’s data businesses. “We will see the same drivers as in 2014. We will continue to invest more to maximize our core. We’ve seen the growth in the data space—a lot of customers are now on data,” he explained.
1995 gifted child model
Data connectivity is now the new revenue driver for telecommunications companies, after over-the-top applications and social-networking sites chomped on the traditional calland-text businesses of mobile operators. Hence, de Larazzabal said, instead of fighting them off, his company decided to embrace them, and sought for ways to generate revenue from their unprecedented competitors. Globe partnered with messaging applications, such as Viber; social-networking sites like Facebook; music-streaming provider Spotify; and sportscontent source NBA. On Thursday the secondlargest telecommunications provider in the Philippines announced that it has partnered with newly minted video-streaming provider HOOQ, a start-up joint venture among Singtel, Sony Pictures Television and Warner Bros. Entertainment. The telco also partnered with rival networks GMA Network Inc. and ABS-CBN Corp., and their respective movie-production subsidiaries for more content. The partnership will enable customers of Globe to enjoy unlimited onlinestreaming access and an offline-viewing option to top Hollywood and Filipino movie and television content via any
device, including computers, smartphones and tablets. To ensure that the service would be seamless, as promised, Globe will now venture into a $500-million network-modernization program to deploy additional data sites around the Philippines. “It reflects our continued commitment to ensure that our services continue to improve,” he said. Globe is spending $850 million in capital expenditures this year—$650 million of which is the actual outlays this year, while the remainder is a spillover from 2014. The company will be raising $350 million this year to finance its programmed investments. The instrument for the capital raising, de Larazzabal said, has yet to be determined. Globe’s mobile, broadband and fixed-line data businesses drove its full-year bottom line to an all-time high of P13.4 billion, 170 percent higher versus the P5 billion registered in 2013. In the same comparative periods, consolidated service revenues reached a new high of P99 billion from P90.5 billion, while operating expenses and subsidies grew by 11 percent to P59.8 billion from P54 billion. Shares of Globe rose by 3.84 percent to P1,895 apiece on Friday.
Photo shows Shaira Luna, a gifted child featured in a 1995 TV commercial as the “batang genius” who mastered the human anatomy. Luna is now one of the top fashion photographers in the country, capturing the best in human form. She joins Promil Preschool in the launch of the Gifted Movement to spark interest and gain commitment from parents and society to continue discovering and nurturing children’s gifts.