Businessmirror march 14, 2015

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Economists With Tunnel Vision Fail to Keep Pace With Global Cuts

pare a thought for Bangko Sentral ng Pilipinas Governor Amando M. Tetangco Jr. The Philippine central bank chief, a shooting enthusiast who has likened battling inflation to firing a handgun, has the strongest currency in Asia this year.

It’s not hard to see why. He’s one of the few holdouts not to lower interest rates in a region where central banks have been rushing to cut amid slowing inflation and a weakening in exports to China. South Korea’s central bank became the latest to surprise economists on Thursday, when it reduced its benchmark to an all-time low, a day after Thailand moved.

“There is a bit of peer pressure for central banks to

Continued on A2

three-time rotary club of manila journalism awardee 2006, 2010, 2012

U.N. Media Award 2008

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PHL’S LOW SAVINGS RATE WEAKER THAN ASEAN NEIGHBORS’ AT 15.9 PERCENT OF GDP

‘Insurers have more room for growth’ PLDT unit sets 2015 revenue T target at

By David Cagahastian

he country’s low savings rate, compared against its neighbors in the Asean, is admittedly a weakness. But according to the Insurance Commission, the low incidence of household savings as percent of local output, or the gross domestic product (GDP), also represents a big opportunity for growth or expansion of the local insurers.

Insurance Commissioner Emmanuel F. Dooc, in his speech at the annual award ceremonies of Fortune Life Insurance Co. on Thursday night, pointed out that the Philippines’s savings rate equal only 15.9 percent of GDP. This pales in comparison with the savings rate of Singapore, 49.4 percent of GDP; Malaysia, 44.3 percent of GDP; and Thailand, 29.5 percent of GDP. But Dooc said that, while the low savings rate of the Philippines is acknowledged as a weakness, local insurers, like Fortune Life, should see it as an opportunity to teach financial literacy to Filipinos, and convince them to save for the rainy

P10 billion

A

D. Arnold A. Cabangon (from left), Fortune Life president; D. Edgard Cabangon, managing director of Isuzu Gencars; and Evelyn T. Carada, EVP and general manager of Fortune Life, present a token of appreciation to Insurance Commissioner Emmanuel F. Dooc during the 2015 Annual Awards Night of Fortune Life. NONIE REYES

DTI sees slower 2015 export growth

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hilippine exports may grow slower than the 10-percent target set by the government this year, due to the appreciation of the peso against the yen and the euro, the Department of Trade and Industry (DTI) said on Friday.

While other currencies are depreciating against the dollar, Domingo

Continued on A8

PESO exchange rates n US 44.2710

said the Philippine peso has been bucking the trend and is strengthening against the greenback.

“The appreciation of the peso is a concern. It appears that the peso would continue to appreciate against the dollar, so we will see its dampening effect on our exports,” said Trade Secretary Gregory L. Do-

mingo said on the sidelines of the Gathering of Industry Champions organized by the Board of Investments.

A stronger peso is a concern for overseas Filipino workers, whose families will receive less for the dollars they remit; and exporters, as this makes their products more expensive and uncompetitive.

The trade department said, however, that it is more concerned about the appreciation of the peso against the currencies of Japan and the euro zone. The peso appreciated 15 percent against the yen, and 35 percent against the euro.

Japan is one of the country’s top See “Export growth,” A2

unit of the Philippine Long Distance Telephone Co. (PLDT) is targeting to increase its revenue by 11 percent this year, as it projects small and medium enterprises (SMEs) to increase their demand for data.

PLDT First Vice President and Head of SME Business Kat LunaAbelarde said PLDT SME Nation’s revenue this year could reach P10 billion, higher than the P9 billion recorded by end-December 2014.

“We expect a very healthy growth rate, actually. The growth will come mainly from the expanding tourism industry, health care, among others,” Abelarde said on Thursday.

She said PLDT SME Nation is “eager” to serve the 800,000-strong SME market in the Philippines, a sector that makes up 99 percent of all businesses in the Philippines.

Abelarde said that the challenge for SMEs is how they can efficiently tap and engage the growing online community to increase their income and their competitiveness.

She said PLDT SME Nation partnered with Samsung and Microsoft Philippines to create “innovative business solutions that will allow entrepreneurs to run their businesses better.”

Abelarde assured SMEs that connectivity will “always be in place,” as PLDT has the “most robust network and nation-widest reach for its fixed, wireless and satellite service.”

PLDT Executive Vice President Eric Alberto said the company’s See “PLDT,” A2

n japan 0.3651 n UK 65.9594 n HK 5.7001 n CHINA 7.0693 n singapore 32.0549 n australia 34.1334 n EU 47.0955 n SAUDI arabia 11.8043 Source: BSP (13 March 2015)

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Economists with tunnel vision fail to keep pace with global cuts sion for years. The nation’s leaders last week set their lowest growth target in more than 15 years, in aiming for a pace of about 7 percent this year, down from last year’s target of about 7.5 percent.

That slowdown is rippling through the rest of Asia.

“There is pressure on exporters and central banks are responding,” said Robert Subbaraman, chief economist for Asia excluding Japan at Nomura Holdings Inc. in Singapore. “I am a bit surprised that it has come as a surprise to the market.”

The Thai and South Korean surprises this week came even after unexpected moves by counterparts not only in Asia but around the world, from Switzerland to Canada. The No. 2 official at the Reserve Bank of Australia, which surprised forecasters with a rate reduction last month, alluded to the pressure posed by counterparts. Deputy Governor Philip Lowe said on March 5 that the country’s higher exchange rate and lower interest rates aren’t at levels that the economy warrants but are unavoid-

JPMorgan Chase & Co. chief Asia economist in Singapore. Australia, Japan and China are among those now projected to step up their stimulus efforts to shore up their economies amid diminishing inflation pressures.

In Manila Bangko Sentral ng Pilipinas hasn’t cut largely because growth is holding up, consumers are spending and interest rates are already low. The next scheduled meeting is on March 26.

“They don’t really have to cut interest rates, because credit growth is very strong and inflation has decelerated but it is not at risk of falling into deflation,” said Neumann at HSBC. Malaysia is another holdout, where policy-makers are juggling the prospect of weakening growth while grappling with a faltering currency, the ringgit.

Bank Negara Malaysia has held its overnight policy rate at 3.25 percent since July, when it raised the benchmark.

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match what others are doing in the region,” said Frederic Neumann, co-head of Asian economics research in Hong Kong at HSBC Holdings Plc., whose team had one of the two forecasters to predict correctly the South Korea decision, among 17 surveyed by Bloomberg News.

Among the head-turning policy moves in Asia so far this year: Bank Indonesia cut rates in February for the first time in three years. Not one of 20 economists surveyed by Bloomberg had predicted a change. Reserve Bank of India Governor Raghuram Rajan has pared rates twice this year in unscheduled moves and the Monetary Authority of Singapore sent traders scrambling on January 28, when it eased weeks before its semiannual policy gathering.

Inconsistent communication

China impact

“The market has been surprised by the strange inconsistency in prepolicy communication,” said Jahangir Aziz,

The biggest drag for Asian economies has been China, the engine of expan-

Export growth. . . markets for vegetables and fruits and processed food products.

“Usually, if there is a 5-percent appreciation or depreciation, exporters can make adjustments quickly.

But if it’s more than that, it may take exporters more time to adjust, maybe a few years,” said Domingo, who is also one of the country’s economic managers.

He said the steep decline in oil prices helped strengthen the peso against foreign currencies. But Domingo said cheaper oil could also pull down the produc tion cost

Rate-cut. . .

Continued from A1

Reserve Bank of India Governor Rajan also suggested a need to keep up with others, citing a strong rupee relative to peers.

“Safety in numbers and the global context of the waves of central bank easing around the world means no one wants to stand out as a strong carrytrade opportunity,” said David Mann, head of macro research Asia at Standard Chartered Bank in Singapore, referring to the tactic of borrowing in a currency with cheaper rates and investing in a higher-yielding one.

Policy-makers also face pressure from exporters and politicians for stimulus—calls that may carry greater weight when other countries are taking action. Lawmakers in India and South Korea were among those signaling that their central banks ought to bring down borrowing costs.

Hours before South Korea’s announcement, the Chosun Ilbo, South

with $156 million at the same point in 2014, exchange data show. The nation’s benchmark-share gauge has risen more than twice as much as indexes in Indonesia, Malaysia and Thailand. That’s helped drive a 1.1-percent gain in the peso in 2015, the best performance among 24 emerging-market currencies tracked

by Bloomberg.

“It’s the growth story which is fueling the positive sentiment on the peso,” Jan Briace Santos, a Manila-based fixed-income portfolio manager at BPI Asset Management,

3-DAY EXTENDED FORECAST MARCH 14, 2015 | SATURDAY

TODAY’S WEATHER

Korea’s most widely read newspaper, cited an internal government report in an article, saying that if the benchmark were cut to 1.5 percent in the first half of this year, economic growth could be boosted to 3.8 percent.

Korean cut

The Bank of Korea lowered the sevenday repurchase rate to 1.75 percent. Domestic demand has fallen“substantially” and policy shifts in major countries pose risks for Asia’s fourth-largest economy, according to Thursday’s statement by the central bank.

“We listen to what policy-makers are telling us, and policy-makers and central bankers have not prepared the market for interest-rate reductions,” said Dariusz Kowalczyk, a strategist at Credit Agricole CIB in Hong Kong.

Among those applauding Thailand’s rate cut was Thai Union Frozen Products Pcl., the world’s biggest tuna canner, which said a weaker currency would help support overseas sales.

The move was “absolutely good

MAR 15 SUNDAY

METRO MANILA

22 – 30°C

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LAOAG

LAOAG CITY 21– 30°C

MAR 15 3-DAY SUNDAY EXTENDED FORECAST

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PHILIPPINE AREA OF RESPONSIBILITY (PAR)

The cycle may yet run its course.

Should the Federal Reserve (the Fed) raise interest rates as anticipated by economists mid-year, central banks in Asia face the risk of capital outflows.

In that environment, they may calculate that risks outweigh advantages of lowering borrowing costs.

“It is very hard to imagine these banks cutting rates in the face of Fed hiking rates,” JPMorgan’s Aziz said.

Zhou Xiaochuan, governor of the People’s Bank of China, played the down risks from a potential interest-rate increase from the Fed this year, when he spoke at a news press conference on Thursday. Bloomberg News

NORTHEAST MONSOON AFFECTING NORTHERN AND CENTRAL LUZON (AS OF MARCH 13, 5:00 PM)

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.

PUERTO PRINCESA CITY 22 – 31°C

Federal Reserve

partnership with Samsung and Microsoft ushers in “a new era of enablement for the smal- and mediumenterprise market segment.”

“Through this strategic partnership, SMEs will have access to game-changing business tools, such as faster and nationwide fixed and wireless broadband solutions, latest gadgets and devices, and relevant collaboration cloud applications,” Alberto said.

“PLDT SME Nation reaffirms its support for Filipino SMEs as it continues to innovate and form partnerships with industry leaders to provide our country’s aspiring entrepreneurs with only the best broadband solutions for their businesses,” Abelarde said. L. Marasigan

a unit of the nation’s second-largest bank, said in a March 11 interview.

Philippine bonds are vulnerable to the US raising rates, as it will erode their yield premium, he said.

The 10-year benchmark government bond yield has risen 12 basis points to 4.05 percent, from this year’s low of 3.93 percent on February 6. That’s 198 basis points more than the rate on similar-maturity Treasuries. ING Groep NV, the biggest Dutch bank, predicts the yield will rise to 4.5 percent by year-end. Bloomberg News

MAR 16 MONDAY

news to exporters, including us,” Thiraphong Chansiri, the company’s president, said in an e-mailed response to questions. The baht weakened to a two-month low versus the dollar on Wednesday, after the quarter-point rate cut that was predicted by just six of the 22 analysts surveyed by Bloomberg.

PLDT. . .

Continued from A8

“Our economy is growing, so why will the central bank cut rates?” said Robert Ramos, the Manilabased chief investment officer at Union Bank of the Philippines, which manages the country’s bestperforming equity fund based on five-year returns. “Bangko Sentral will keep rates where they are now, for the meantime, and wait for the US to move,” he said in a March 6 interview.

Foreign funds have pumped $915 million into Philippine stocks this year through March 11, compared

incurred by exporters.

Last year the country’s merchandise exports expanded 9 percent to $61.81 billion, from $56.69 billion recorded in 2013.

Electronic products remained as the country’s top export, with total receipts of $25.87 billion, accounting for more than 40 percent of exports revenue last year.

Domingo said there is a need to move toward the export of “highvalue” products and to diversify the country’s exports to make the country more competitive. Catherine N. Pillas

able given the actions elsewhere.

Rajan’s calculation

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Watch PANAHON.TV everyday at 5:00 AM on PTV (Channel 4).

METRO DAVAO 23 – 32°C

Weekday hourly updates: 6:00 AM on Balitaan, 7:00 AM & 8:00 AM on Good Morning Boss!, 9:00 AM, 10:00 AM, 11:00 AM, 12:00 PM, 1:00 PM on News@1, 3:00 PM, 4:30 PM, and 6:00 PM on News@6

www.panahon.tv

SABAH CELEBES SEA

11:06 PM

0.06 METER

Partly cloudy to at times cloudy with rain showers and/or thunderstorms

Light rains

ZAMBOANGA CITY 23 – 33°C

LOW TIDEMANILA HIGH TIDE

@PanahonTV

3:27 PM

0.87 METER

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Editor: Dionisio L. Pelayo • Saturday, March 14, 2015 A3

Aquino violated rules–Mamasapano probe panel

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By Rene Acosta

HE Board of Inquiry (BOI) blamed President Aquino over the police operations that ended in the killing of 44 police commandos, saying that the President committed several violations, including bypassing the chain of command and utilizing a suspended police official.

However, the board recommended the conduct of further investigation by government prosecution agencies in order to determine the criminal and administrative liabilities of Aquino, other government officials involved and even fighters of the Moro Islamic Liberation Front (MILF).

“Appropriate government agencies should pursue the investigation of the Mamasapano incident to determine the criminal and administrative liabilities of relevant government officials, the MILF and other individuals,” the board said.

The BOI’s report was made public by the National Police on Friday by uploading it on its web site. The report, consisting of 122 pages, took into consideration the affidavits of police and military officials and other individuals whom

the members of the board sought in its investigation.

“The chain of command in the National Police was violated. The President, the suspended National Police chief [Director General Alan Purisima] and the former [Special Action Force (SAF)] director [Director Getulio] Napeñas kept the information to themselves and deliberately failed to inform the National Police OIC [officer in charge] and the SILG [secretary of the Interior and Local Government]. The chain of command should be observed in running operations,” the BOI said in its findings.

Deputy Director General Leonardo Espina, National Police OIC, and Interior Secretary Manuel Roxas II earlier claimed that they were not informed of the January 25 operation against Jema’ah Islamiyah bomber

Zulkifli bin Hir, alias Marwan, in Mamasapano, Maguindanao.

Instead, the planning was only confined among Aquino, Napeñas and Purisima, who is serving a suspension ordered by the Ombudsman.

“With respect to Oplan Exodus, the chain of command in the National Police should have been OIC Espina [as senior commander] to Napeñas [as intermediate commander]. Purisima could not legally form part of the chain of command by reason of his suspension,” the BOI said.

“The President has the prerogative to deal directly with Napeñas… but the act of dealing with Napeñas instead of Espina bypassed the established National Police chain of command,” it added. The report also belied the earlier statement of Aquino that he had been “fooled”

by Napeñas about the operation.

“The President gave the go signal and allowed the execution of Oplan Exodus after the concept of operations was presented to him by the director of the Special Action Force,” it said.

“The President allowed the participation of the suspended chief of National Police Director General Alan Purisima in the planning and execution of Oplan Exodus despite the suspension order of the Ombudsman,” it added. The BOI maintained that Purisima’s involvement in the planning and even execution of the operation “violated the suspension order is-

sued by the Ombudsman.”

On the operation itself, the BOI found its planning, preparation and even its execution wanting.

“Oplan Exodus can never be executed effectively because it was defective from the very beginning.

Troop movement was mismanaged, troops failed to occupy their positions, there was lack of effective communication among the operating troops. Command and control was ineffective and foremost, there was no coordination with the Armed Forces and peace mechanisms [CCCH and AHJAG],” it said.

However, even senators could not agree that the operating forces should coordinate with other bodies, except the military, since the subject of their operation was located deep inside an area controlled by the MILF. The commandos tasked to establish the blocking force for the attackers’ withdrawal were mowed down by MILF and even Bangsamoro Islamic Freedom Fighters gunmen after their colleagues have gotten Marwan.

The BOI report also found the response of the military to the pinned commandos, who have been pleading for reinforcements and even artillery fire, as inappropriate or lacking.

“Artillery fire support was factored in as one of the mitigating actions of the SAF. However, such fire support was not delivered when needed. In consideration of the peace process, Armed Forces did not deliver the artillery fire support,” it said.

Aid to families of Fallen 44 continues–Palace

By Joan Santiago

Philippines News Agency

M

ALACAÑANG on Friday reiterated that it continues to address requests for assistance of families of the 44 Special Action Force (SAF) members who were killed in Mamasapano, Maguindanao, on January 25.

In a briefing, Presidential Deputy Spokesman Abigail Valte said the various government agencies tasked to help the families of the SAF troopers “have been continuing to carry out their role as swiftly as possible.”

“Apart from monetary aid from the President’s SocialFund,thenationalgovernmenthasalsobeenprovidingsupportintheformofscholarships,employment assistanceandhousinggrants,amongothers,”shesaid.

Valte said the National Police Commission (Napolcom) has accepted children of the slaughtered SAF members under its scholarship program, while the Commission on Higher Education is assisting college-age dependents. She said children of the SAF members who are not covered by the scholarship programs under the two agencies will be helped through the President’s Social Fund.

On employment, Valte said applications to join either the government or the private sector are still ongoing. She also said that skills and career coaching have been scheduled by the Technical Education and Skills Development Authority (Tesda).

For livelihood assistance, the Palace executive said the Department of Social Welfare and Development is currently conducting assessment based on the families interests and is set “to submit project proposals within the next few weeks.” “For those

who have expressed interest in putting up businesses or expanding existing ones, the Department of Trade and Industry [DTI] has been exploring opportunities in their respective communities, and has committed to providing seed funds,” she said.

Members of the Fallen 44’s families who need medical assistance are also being catered and helped by the Department of Health (DOH), she said.

“DOH personnel have accompanied family members to medical checkups and have shouldered all related expenses, including medicine. In coordinating with the families, the DOH makes it a point to take note of specific needs. Thus, they have set up financial-aid mechanisms for those requiring more regular care and are monitoring the status of pregnancies,” she said.

Requests for housing assistance are also being assessed, she said, noting that the “National Housing Authority [NHA] remains in constant communication with the families.”

“Project proposals are currently being drawn up for the units, around 16 of which will be ready for occupancy within the next two months. The NHA is also coordinating with other families who have opted for the repair and reconstruction of their existing houses,” she said.

Valte stressed that “as the President has repeatedly emphasized, the government is committed to securing the futures of the fallen SAF troopers’ families.”

Relatively, the Palace official clarified reports that one family requested for 14 scholarships.

Valte said the request is not for 14 scholarships but 12, and pointed out that these are not for regular scholarship but Tesda training.

Economy

A4 Saturday, March 14, 2015 • Editors: Vittorio V. Vitug and Max V. de Leon

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Steag power plant back to full capacity

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By Lenie Lectura

he 210-megawatt (MW) Mindanao coal-fired power plant now runs at its full capacity, providing a major relief to the volatile power-supply condition in Mindanao.

“We are confident that, with our units now back on line, Mindanao is more prepared to meet its electric supply needs, especially during the summer months, where demand usually is at its peak,” said Steag State Power Inc. (SPI) President and CEO Dr. Bodo Goerlich.

SPI owns and operates the power facility that went offline last month to give way for maintenance work. Unit 1, which went off line for a planned preventive maintenance on February 21, was synchronized to the Mindanao grid on March 12.

Earlier, Unit 2, which also went offline for preventive maintenance on February 19, was restored to the grid on March 2 as scheduled.

Goerlich expressed optimism that, with the two units now operating at full capacity, Mindanao’s power-supply condition will improve.

The SPI official explained that the timely conduct of the preventive maintenance and restoration of the units are just in time for the onset of the summer months.

Earlier SPI Power Plant Manager Dr. Carsten Evers had explained that the preventive maintenance works need to be carried out periodically to sustain optimum efficiency and reliability of the electricgenerating units.

SPI’s power plant at the Phividec

Industrial Estate in Misamis Oriental is composed of two identical power-generating units,each with a net generating output of 105 MW. Since the start of its operations in November 2006, SPI has delivered more than 11.5 billion kilowatthour of electricity representing about a fifth of Mindanao’s total power supply.

SPI is principally owned by the German company Steag GmbH, with Aboitiz Power and La Filipina Uygongco Corp. as local partners.

Steag GmbH is a leader in advance coal-power generation technology, and is one of the pioneers in operating and maintaining a highly efficient and reliable coal-fired power plant in the country.

LTFRB sets deadline for GPS providers

By Lorenz S. Marasigan

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LOBAL Positioning System (GPS) providers interested in supplying bus companies with their geomapping devices have until end-March to submit their petitions for certification before the Land Transportation Regulatory Board (LTFRB), the agency said on Friday.

In a news statement, LTFRB Chairman Winston M. Ginez said his office will give interested parties until March 31 to “submit their GPS system to LTFRB’s Information Systems Management Division [ISMD] for registration and testing.”

Earlier this month Ginez had announced plans to pilot test the GPS systems on select buses starting in the second quarter of this year.

The decision to install the system on public-utility buses (PUBs) was based on a study of the UP National Center for Transportation (UP-NCTS), which recommended the GPS device as the best and most viable option to regulate bus speed to minimize road accidents.

Gines said that all GPS providers “must secure certification from LTFRB that it has passed the testing process before they can install it to a bus of their choice for actual testing.”

Based on the UP-NCTS study, commuting by public transport is “much riskier than by car, with bus passengers exposed to higher accident risk.”

Calculating the accident rate per vehicle for each mode of transport, the study showed that the bus is six times more at risk than car, and five times more than jeepney or taxi or UV Express service.

Since 2010 there have been 10,826 accidents involving buses.

With the Department of Science and Technology-Advance Science Technology Institute and the Department of Transportation and Communications, the LTFRB “has successfully implemented the testing of the bus units using the specification and registration process,” Ginez said.

“The board is now in the final review of coming up with the Memorandum Circular on the GPS Providers Accreditation and GPS installation on all PUB units nationwide. We are looking at second quarter of the year to issue the policy,” Ginez said.

An in-vehicle GPS device and communication system that will continuously send speed and location data to control center will be installed soon in PUBs, Ginez said.

A bus will be tagged as speeding when the in-vehicle GPS device exceeds the imposed speed limit. Bus passengers can also monitor realtime speed of the bus through an onscreen display system installed in the bus.

Spaghetti wires One may wonder how this cable and telephone lineman could be able to troubleshoot a connection from the maze of wires

hanging by a post in Manila. Well, it’s all in a day’s work for this street daredevil. Roy Domingo

Albay embarks on new sports-tourism program with P700-million budget

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resident Aquino has recently approved a P700-million budget for the 2016 Palarong Pambansa. Albay, which will host the event, has committed to putting up a P150-million equity for the games on top of the budget approved

by Malacañang.

Albay Gov. Joey Salceda said half of the budget approved by the President has already been released for the preparation of the sports facilities needed, among them the construction of the Albay sports complex in Guinobatan town, the games’ main venue. The facility will have an international standard oval track and a grandstand that could accommodate thousands of spectators.

The Palarong Pambansa will be rolled out as a sports tourism event, the first time in the history of the national games. A sports-tourism event assures combatant athletes fame and glory from their fierce competitions, and, at the same time, promises them memorable touristic adventures, while the host province derives hefty tourism-revenue benefits. The scheme is now slowly taking shape Salceda said the provincial government will also put up a 15,000-member athletic delegations from the country’s 17 regions expected to join the Palarong Pambansa. The number could tremendously expand if the players’ friends, families and other visitors who will come to watch the games will be counted, all of whom will

spend money while in Albay that will help fuel the local economy.

The governor assures his province will not just focus on tourismrevenue gains alone. He pointed out that Team Albay’s records in the Palaro has, in fact, consistently shown it has led the Bicol regional team to better ranking, climbing from 12th in 2013 in Dumaguete to ninth in the 2014 Laguna national derby, where Albay contributed five of the nine golds earned by the region in the games. Albay hopes to fare well in the May 3 to 9 Palarong Pambansa this year in Tagum City.

Salceda said they put as much importance and value on the Palaro as both a sporting and tourism undertaking. Along the idea of sports tourism but toeing the strict standards of the games, Albay plans to distribute Palaro’s 21 events around the province so that participants and visitors can also get to explore Albay’s best tourism destinations and specialties.

“My guidance to Team Albay [is that] the Palarong Pambansa 2016 technical working group is to design a “multivenue” layout that shall distribute participants in different sports sites around the province so they can also enjoy our global-standard tourism sites while competing,” Salceda said.

As a leading province in the country’s travel and tourism, Albay figures prominently in the March 10 to 13 Marche International Proffesionels d’Immobilier at the Palais de Festivals in Cannes, France. The

province has been featured in many national and international travel marketing fairs, including the Berlin ITB 2012, the London WTM 2013, the Shanghai ITM 2013 and the Department of Tourism promotions in Hong Kong in 2014.

The modernized sports facilities will be viable and sustainable for Albay, a built-up capability to host future big events, such as the South East Asian Games. This will be an add-on to the province’s present standing as the country’s top-growing tourism destination, Salceda added. PNA

Survey: Aquino failed to address graft, corruption in Philippines

By Cai U. Ordinario

E

ven after five years in office, many Filipinos still believe the Aquino administration failed to institute necessary reforms needed to curb corruption in the Philippines.

This was based on the results of the latest survey conducted

by Ibon Foundation Inc., which showed that 54.7 percent of Filipinos did not believe there was less corruption in the country in the past three months.

“Critics have pointed out that the Aquino administration’s drive against corruption lacks genuine reforms, including holding accountable several administration allies involved in anomalies,” Ibon said in a news statement.

The survey was administered to 1,501 respondents nationwide.

Only 29.5 percent said there was less corruption in the country in the past three months.

Around 15.2 percent were uncertain if there was less corruption in the country in the past three months, and 0.6 percent did not provide an answer. Ibon had earlier said deepening corruption and severe inequality are among the reasons that have pushed it to call for President Aquino’s ouster.

“The more relevant measurements of development are also not improving as the jobs crisis continues and poverty persists,” Ibon said.

“Creating the illusion of a healthy economy, despite difficult social realities, will not prevent the people’s growing opposition,” it added.

In the government’s official poverty estimates for the first semester of 2014, the country’s poverty incidence increased to 25.8 percent, from 24.6 percent in the same period in 2013.

Further, the Philippine Statistics Authority said that, on average, incomes of poor families were short by 27 percent of the poverty threshold in the first semester of 2014. This means that, on average, an additional monthly income of P2,370 is needed by a poor family with five members in order to move out of poverty in the first semester of 2014.

The Ibon’s nationwide survey on corruption used multistage probability sampling method and has a margin of error of plus or minus 3 percent.

Ibon said the survey is noncommissioned and was conducted from January 19 to 30 across various sectors in 16 regions.

briefs DND ALLOTS P52.5M FOR 5.56MM AMMO The Department of National Defense (DND) has announced that it is allocating P52.5 million for the acquisition of 10 million 5.56 mm M855 bullets.

These are the rounds being used by the various models of standard issue M-16 and M-4 rifles of the Armed Forces of the Philippines.

The fund will be sourced from this year’s General Appropriations Act. Winning bidders are required to deliver the items within 180 calendar days from the opening of letter of credit.

Bidders should have completed, within the last five years from the date of submission and receipt of bids, a contract similar to the project.

Prebid conference is scheduled on March 26 at 10 a.m. at the DND bids and awards committee conference room, basement, left wing, DND Building, Camp General Emilio Aguinaldo, Quezon City. Bid opening is on April 16 on the same venue and time. PNA

d.o.l.e. declares phividec labor-compliant ecozone CAGAYAN DE ORO CITY—The Department of Labor and Employment (DOLE) has officially accorded the Phividec Industrial Estate in Misamis Oriental (PIE-MO) the distinction as a Labor Laws-Compliant Economic Zone (LLCEZ).

The DOLE declaration was based on the best labor practices of the estate, particularly on the general labor and occupational safety and health standards; child-labor free institution; productivity-based pay movers; and labor-management cooperation.

Labor Secretary Rosalinda Dimapilis-Baldoz, who graced the event at the PIE-MO compound in Tagoloan, Misamis Oriental, also unveiled the distinction marker at the entrance of the estate’s compound.

The DOLE’s declaration of LLCEZ is first in Mindanao. The declaration was made possible through the simultaneous joint assessment by LLCEZ officers to all existing Phividec locators in the eastern part of the province. Butch Enerio

marina receives copy of emsa report

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he Maritime Industry Authority (Marina) has received a copy of the final report of the European Maritime Safety Agency (Emsa), according to Marina Administrator Maximo Mejia Jr. He said the report contains the result of the audit undertaken by the European safety agency conducted in the Philippines from September 29 to October 4 last year.

Mejia, however, declined to give specifics on the Emsa report, stressing that it is not a public document per se and Emsa expects it to remain confidential. Despite this nondisclosure, the Marina chief remains upbeat.

“The report focuses on our continued need for a strong monitoring system and the need for us to catch up on that,” Mejia said. PNA

NOTICE TO THE PUBLIC

Notice is hereby given that MS. SHARON R AMOS GALANG whose picture appears above is no longer connected with ETERNAL GARDENS MEMORIAL PARK CORPORATION since November 13, 2014.

Port QUEUE

Hundreds of cargo trucks line up at the Delpan Bridge in Manila to deliver container vans stuffed with various goods and materials to the Port of Manila early this week. Contrary to previous public statements, the government has yet to resolve the lingering port-congestion problem. KEVIN DE LA CRUZ

Any transactions entered into by Ms. Galang for and in behalf of the company after such date shall not be honored by the company.

ETERNAL GARDENS MEMORIAL PARK CORPORATION

Economy BusinessMirror

news@businessmirror.com.ph

briefs

TEAM ENERGY RUSHES RESTORATION OF SUAL PLANT

Tokyo Electric Power Co. and Marubeni Corp.’s joint venture, Team Energy Corp. is targeting to restore the full capacity of its 1,200-megawatt (MW) Sual Power Plant on Friday.

“It won’t remain on outage until next week, we plan to restore today [Friday],” Team Energy Senior Manager for External Affairs Gregory Romualdez, said. He assured that Team Energy’s personnel are working fast to normalize the Pangasinan-based plant’s operations.

“We are focused on restoring full plant operations at the soonest possible time. Plant personnel are working double time to address the situation,” he said.

He confirmed that the line tripped from 9:59 to 10:25 a.m. on Friday, which was initially published by the Manila Electric Co. through its Twitter account. PNA

Q.C. GROUP SEEKS CLOSURE OF PAYATAS DUMP

A PETITION was filed on Friday by various homeowners’ association before the Supreme Court (SC) seeking the issuance of a writ of kalikasan that would compel the government to shut down the Payatas sanitary landfill in Quezon City.

In its petition, the Alyansa ng mga Samahang Nagkakaisa sa Payatas, headed by Nita Panoy, sought the closure of the landfill for violating the provisions of Republic Act 9003, or the Ecological Solid Waste Management Act, and other environmental laws, such as the Clean Air Act, Clean Water Act, Toxic Substances and Hazardous and Nuclear Wastes Control Act. Respondents in the petition were Quezon City Mayor Herbert Bautista and other concerned government officials, as well as the Department of Environment and Natural Resources-Environmental Management Bureau.

Joel R. San Juan

Saturday, March 14, 2015 A5

Lawmakers to Aquino: Don’t lose sight of economy after Mamasapano blunder

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group of lawmakers on Friday called on President Aquino to remain focused on strengthening the economy, despite attempts to discredit his administration on the basis of a police operation that was bungled by ground commanders.

According to Liberal Party Secretary-General and Samar Rep. Mel Senen Sarmiento, the Mamasapano incident cannot obscure the undeniable accomplishments of Mr. Aquino, especially in turning the country to one of the fastest- growing economy in Southeast Asia, next only to China.

“While other peoples across other countries choose to focus on their economy, some of our countrymen choose to stir up political intrigues and issues that divide the country,” Sarmiento said.

“This Mamasapano issue cannot take away the fact that President Aquino sacrificed a lot to bring our economy back on track. Now, the government has the money to spend on infrastructure, education,

Armed Forces of the Philippines and Philippine National Police (PNP) modernization and poverty alleviation, unlike before when much of our resources go to corruption,” he added.

The veteran lawmaker also called on the people to rally behind President Aquino to repel ambitious “power grabbers” and political “free riders,” whose only intention is to advance their own political and economic interests.

He cited the case of so-called National Transformation Council composed largely of political personalities with questionable moral background and track record in public service.

“As this Aquino administration is hell-bent in achieving inclusive

growth, Filipinos must rally behind the President instead. We are a country with a long wish list, with the recent report by Bloomberg that we are the second fastest-growing economy, next to China. We have the chance to actually get what we want as a country,” Sarmiento pointed out.

Rep. Jerry Trenas of Iloilo, on the other hand, said the people should translate their grief on the Mamasapano tragedy into a firmer commitment to fight for peace in Mindanao.

Trenas said the time has come for the nation to move on from the Mamasapano debacle and focus on winning the war against poverty, which, he said, is the main culprit in the continuing secessionism in Mindanao.

“We should stop the blame game on this Mamasapano issue and move on. We cannot let this issue destroy the many accomplishments of the Aquino administration,” Trenas said, as he likened the country to a “household where the family must focus on ‘hanapbuhay’ and not on ‘hirap ng buhay’ all the time.”

He said that, despite intrigues and controversies instigated by his political detractors, Mr. Aquino should not lose sight on his mission to defeat corruption and win the war against poverty.

Spic-and-span job Unmindful of the peril and overcoming fear of heights,

workmen do a spic-and-span job on the glass façade of a Makati building. Photo also shows a warped mirror reflection of nearby structures. Nonie Reyes

“Amid the controversies instigated by some sector of the society, P-Noy should continue focusing on his job and should not waste the remaining months of his term with these distractions,” Trenas said.

He emphasized that the only person who should take responsi-

bility for the Mamasapano tragedy was relieved PNP Special Action Force Director Getulio Napeñas because he was the one who planned and executed the mission to neutralize international terrorists Zulkifli bin Hir, alias Marwan, and Basit Usman. PNA

A6 Saturday, March 14, 2015

Opinion BusinessMirror

editorial

Oil prices and airfares

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HE flag-down rate for taxis has been reduced from P40 to P30.

The last time the Land Transportation Franchising and Regulatory Board (LTFRB) raised taxi fares was in January 2010. The flag-down rate went from P30 to P40, and the succeeding mileage charges were increased to P3.50, from the previous P2.50, for every 300 meters. At that time the price of crude oil was over $100 per barrel.

Prior to that increase, another was approved in 2004, when the oil price was $60. From 2004 to 2010, the oil price went from $60 to $150, down to $40 and then back up to $110. Now oil is back to $50.

While the current reduction of the flag-down fare may have some justification because of the drop in gasoline prices, the LTFRB is not exactly proactive in changing the fare structure based on the movements in the oil and gasoline prices.

However, the public always applauds the wisdom of the government agencies when any regulated charges are reduced. When those same charges are increased, applause turns to condemnation and wisdom becomes weak-mindedness.

The public is also calling for a reduction in global airfares, both in the Philippines and abroad. The reduction or elimination of the fuel-service charge is considered as not enough of a decrease in passenger travel costs.

The International Air Transport Association, which represents more than 250 domestic and international airlines, has estimated that airfares could decrease by as much as 5 percent compared to 2014 prices.

Local stock-market investors are looking for increased profits—and perhaps stock-buying opportunities—for our local airline companies.

Since fuel is by far the biggest single cost faced by airlines, on one side, company profits should increase. Yet, with a 45-percent drop in fuel costs to the airlines, then ticket prices should also go down. While eventually it will be a mix of both—higher profits and lower ticket prices—you cannot have a large amount of both.

One reason that airline-ticket prices will not drop dramatically is that fuel costs account for just 26 percent of the price of an airline ticket. Further, airlines usually buy their fuel through long-term, fixed-price contracts. Also, airlines cannot adjust prices as quickly as fuel costs change. For example, in March 2010, fuel prices were up 75 percent from a year earlier, but airfares were up only by a tenth, 7.5 percent.

For the time being and for the near future, the direction of oil prices is uncertain, although a lower crude-oil prices in the next months are probable.

As far a substantial drop in the price of an airline ticket to Cebu or Davao is concerned, perhaps, we should just be grateful the cost to drive or take a taxi to airport is lower.

03142015

US economy continues to fall John Mangun

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OUTSIDE THE BOX

HE United States continues to crank out the worst economic numbers since the global economy began falling off the cliff in 2008.

In the past week, following the weakest holiday-season retail sales since 2008, and after January’s monthly report of a drop of 0.08 percent, February 2015 retail sales dropped “unexpectedly” by 0.6 percent, instead of showing a 0.3-percent gain. The talking heads on financial television blamed bad weather, as if the US has reverted back to the 19th century, where people could not get the horse and wagon into town until the spring thaw. It is amazing that bad weather has only been a primary cause for bad economic numbers, since the Federal Reserve started its money printing and zero interest-rate policy.

Further, if March 2015 sales continue the January-February trend, the first quarter of 2015 will show a 6-percent drop, which is a disaster for an economy that is driven primarily by consumer spending. Apparently, all the money that Americans are saving on lower gasoline

prices is being used for something other than buying stuff.

Now, the estimates for first-quarter economic growth are being revised downward based on the higher US trade deficit and the consumer spending. In fact, there is a growing fear that the first-quarter growth may be nonexistent, leading to an actual shrinking of the US economy. That ties in with what I wrote on Thursday: “White House economist and aide to President Obama, Jason Furman, said that the strong dollar is a headwind for US economic growth. In truth, the White House is setting up to use the stronger dollar as an excuse if economic growth slows.”

But the devil in the economic data is found in the details. One of the most important gauges of US economic activity is found in the price of lumber, as this directly relates to homebuilding, accounting for about 30 percent

of the US economy.

Lumber prices have crashed, down 32 percent from the 2013 high and back to 2012 levels. A comparison chart of lumber price changes yearon-year, and business activity shows a very close correlation with lumber prices forecasting business activity both up and down.

There are many bizarre things happening in the US economy. For example, there are more Americans employed as waiter/waitresses and bartenders than ever before. But maybe that is understandable, since 2014 marked the first year that Americans spent more money for food in restaurants and fast-food joints than they did on “raw” food from grocery stores and supermarkets.

Last week it was also discovered that 80 percent of all hourly wage growth since 2008 has gone to the 20 percent of those employees who are classified by the Bureau of Labor Statistics as “working-supervisors and job leaders.”

In other words, The Bosses. The 80 percent who make up the regular rank-andfile employees of America were seeing a 4-percent wage growth in 2007 and now are lucky to have a 1.5-percent income growth. Apparently, being a bartender is not a fast-track to more income.

While we are justifiably concerned about income disparity in the Philippines, the US actually has a greater problem in that, not only is income and wealth disparity a serious matter, the

Japan’s cautionary tale for South Korea William Pesek

BLOOMBERG VIEW

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HE Bank of Korea (BOK) has no shortage of diplomatic ways to explain Thursday’s surprise rate cut, including weak domestic demand, sluggish business investment and anemic exports.

But it’s worth being clear what this move was really about: Japan.

For weeks, South Korean Finance Minister Choi Kyung-hwan and other politicians have been demanding that the BOK weaken the won so Korean exporters could better compete with their counterparts in Japan. Which was fair enough: Since mid-November 2012, when Tokyo began devaluing its currency, the won has surged 44 percent against the yen. On March 12 BOK Governor Lee Ju-yeol finally bowed to the pressure, slashing the central bank’s repurchase rate a quarter of a percentage point to a record-low 1.75 percent.

In some sense, however, South Korea still isn’t taking Japan seriously enough.

South Korea should be less concerned about its short-term export woes and more concerned about the prospect of mimicking Japan’s lost economic decades since the 1990s. Unless policymakers act far more aggressively in the near future, they still risk a long-term state of “Japanization,” a semipermanent deflationary funk that strangles living standards. Here are three ways

Seoul can avoid that fate.

First, it should end its monetary stinginess. With inflation at the slowest pace since 1999 and exports down 3.4 percent last month, Lee should lower interest rates even further—immediately. Considering monetary-policy shifts can take six months to affect the real economy, South Korea can’t afford to wait.

South Korea’s high household-debt levels—currently at a record $962 billion, or 70 percent of gross domestic product—are said to have dissuaded Lee from cutting rates sooner. And he’s right not to take that problem lightly.

But Seoul can offset the risk that lower rates will exacerbate household debt by introducing so-called macroprudential policies: tighter regulations on future loans; bans on risky, low down-payment mortgages; and even new taxes to deter households from becoming overly indebted in the first place.

Second, South Korea should prod companies to raise wages. Beginning this year, South Korea’s family-owned con-

glomerates, or chaebol, will be subject to a 10-percent tax on excessive hoarding of cash that could be better spent on wages or investments. But Korea also must address the breakdown of the labor market over the last 15 years. Today about a third of the work force is employed on temporary contracts that offer lower pay than full-time employees—about 56 percent less, on average—and limited benefits.

The Japanese example underscores that this is a serious impediment to economic recovery: part of the reason that the combination of fiscal stimulus and monetary easing initiated by Japanese Prime Minister Shinzo Abe has failed to gain traction is that 38 percent of people in his country are working under similarly precarious conditions.

South Korean President Park Geunhye could help change this situation by using her bully pulpit to shame companies that underpay workers.

She could also push for tax laws that would give those companies financial incentives to hire their part-time staff to full-time contracts. As Employment and Labor Minister Lee Ki-kweon told Bloomberg News recently: “Management at companies should stop this misuse—hiring temporary workers just for cost-cutting purposes. Profits should also be used to improve conditions at subcontractors, whose workers are paid much less.” He added that “this isn’t just about philanthropic capitalism”—it’s good business practice, as fatter paychecks give workers more disposable income to spend on the things they’re helping to produce.

lower economic groups are also caught in a dangerous debt spiral.

Of those in the lowest 25 percent of net worth, debt as a percentage of family assets was 100 percent in 2001.

That is bad enough when you owe as much as you have, but in 2014 that percentage is reaching 150. The rich are getting richer, and the poor are being buried in debt.

And here we sit in the Philippines with a strong banking system, a sound government fiscal program and a central-bank monetary policy that have all produced enviable results. Yet, we continue to struggle to fully capitalize on our potential.

Also, this past week researchers at England’s Oxford University predicted that 47 percent of US jobs are at ”high risk” of computerization and “robotization” over the next two decades. Losses would include jobs in transport and logistics, construction, mining, food preparation and the police force. Even high-value positions, like doctors and lawyers, could be face decreases due to this phenomenon.

Unfortunately, the study did not mention any losses in number of politicians.

E-mail me at mangun@gmail.com.

Visit my web site at www.mangunonmarkets.com. Follow me on Twitter @mangunonmarkets. PSE stock-market information and technical analysis tools provided by the COL Financial Group Inc.

Third, South Korea needs to stop obsessing over exchange rates. The country needs to become more competitive, but it would be a mistake to pursue that goal solely through depreciation.

(Japan has discovered over the past two decades that depreciation can’t counteract persistent deflation.) The South Korean government should instead be focusing on structural reforms that would give companies more incentive to innovate and raise productivity. (It could change the tax system, for example, to support new start-ups, rather than the chaebol who are privileged under current arrangements.) In that sense, South Korea should be modeling itself on Germany. As I’ve written before, German exporters don’t grumble about currency rates when times are tough; with encouragement from their government, they adjust and find new ways to maximize profits.

Park seems to recognize that South Korea must learn to thrive even when exchange rates moves against it. She has pledged, for example, to build a creative economy that produces new industries, generates good-paying jobs and reduces the dominance of the chaebol. But for too long, South Korea has relied on depreciation to shield the country from creative destruction.

The BOK’s recent rate cut was the right move for now; in the short term, it should help exporters keep pace with their competitors. But if South Korea wants to avoid ending up in Japan’s economic rut, its ambitions will have to go beyond interest rates.

Opinion BusinessMirror

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We need legally binding treaty to prohibit nuclear weapons

Evangelii Gaudium

By Ray Acheson

Rev. Fr. Antonio Cecilio T. Pascual

InterPress Service

SERVANT LEADER

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EW YORK—Five years after the adoption of the Nuclear Non-Proliferation Treaty (NPT) Action Plan in 2010, compliance with commitments related to nuclear disarmament lags far behind those related to nonproliferation or the peaceful uses of nuclear energy.

Yet, during the same five years, new evidence and international discussions have emphasized the catastrophic consequences of the use of nuclear weapons and the unacceptable risks of such use, either by design or accident.

Thus, the NPT’s full implementation, particularly regarding nuclear disarmament, is as urgent as ever.

One of the most effective measures for nuclear disarmament would be the negotiation of a legally binding instrument prohibiting and establishing a framework for the elimination of nuclear weapons.

Not everyone sees it that way.

In fact, ahead of the 2015 Review Conference (scheduled to take place in New York from April 27 to May 22), the NPT nuclear-armed states and some of their nuclear-dependent allies have argued that any such negotiations would “undermine” the NPT and that the Action Plan is a long-term road map that should be “rolled over” for at least another review cycle.

This is an extremely retrogressive approach to what should be an opportunity for meaningful action.

Negotiating an instrument to fulfill Article VI of the NPT would hardly undermine the treaty.

On the contrary, it would finally bring the nuclear-armed states into compliance with the legal obligations.

Those countries that possess or rely on nuclear weapons often highlight the importance of the NPT for preventing proliferation and enhancing security.

Yet, these same countries, more than any other states parties, do the most to undermine the treaty by preventing, avoiding, or delaying concrete actions necessary for disarmament.

It is past time that the NPT nucleararmed states and their nuclear-dependent allies fulfill their responsibilities, commitments and obligations—or risk undermining the very treaty regime they claim to want to protect.

Their failure to implement their commitments presents dim prospects for the future of the NPT. The apparent expectation that this noncompliance can continue in perpetuity, allowing not only for continued possession but also modernization and deployment of nuclear weapon systems, is misguided.

The 2015 Review Conference will provide an opportunity for other governments to confront and challenge this behavior and to demand concerted and immediate action. This is the end of a review cycle; it is time for conclusions to be drawn.

States parties will have to not only undertake a serious assessment of the last five years but will have to determine what actions are necessary to ensure continued survival of the NPT and to achieve all of its goals and objectives, including those on stopping the nuclear arms race, ceasing the manufacture of nuclear weapons, preventing the use of nuclear weapons, and eliminating existing arsenals.

The recent renewed investigation of the humanitarian consequences of nuclear weapons is a good place to look for guidance. The 2010 NPT Review

Conference expressed “deep concern at the catastrophic humanitarian consequences of any use of nuclear weapons.”

Since then, especially at the series of conferences hosted by Norway, Mexico and Austria, these consequences have increasingly become a focal point for discussion and proposed action.

Governments are also increasingly raising the issue of humanitarian impacts in traditional forums, with 155 states signing a joint statement at the 2014 session of the UN General Assembly highlighting the unacceptable harm caused by nuclear weapons and calling for action to ensure they are never used again, under any circumstances.

The humanitarian initiative has provided the basis for a new momentum on nuclear disarmament. It has involved new types of actors, such as the Red Cross and Red Crescent Movement, the United Nations Office for Coordination of Humanitarian Affairs, and a new generation of civil-society campaigners.

The discussion around the humanitarian impact of nuclear weapons should be fully supported by all states parties to the NPT. The humanitarian initiative has also resulted in the Austrian Pledge, which commits its government (and any countries that wish to associate themselves with the Pledge) to “fill the legal gap for the prohibition and elimination of nuclear weapons.”

As of February, 40 states have endorsed the Pledge. These states are committed to change. They believe that existing international law is inadequate for achieving nuclear disarmament and that a process of change that involves stigmatizing, prohibiting and eliminating nuclear weapons is necessary.

This process requires a legally binding international instrument that clearly prohibits nuclear weapons based on their unacceptable consequences. Such a treaty would put nuclear weapons on the same footing as the other weapons of mass destruction, which are subject to prohibition through specific treaties.

A treaty banning nuclear weapons would build on existing norms and reinforce existing legal instruments, including the NPT, but it would also close loopholes in the current legal regime that enable states to engage in nuclear weapon activities or to otherwise claim perceived benefit from the continued existence of nuclear weapons while purporting to promote their elimination.

NPT states parties need to ask themselves how long we can wait for disarmament. Several initiatives since the 2010 Review Conference have advanced the ongoing international discussion about nuclear weapons.

States and other actors must now be willing to act to achieve disarmament, by developing a legally binding instrument to prohibit and establish a framework for eliminating nuclear weapons. This year, the year of the 70th anniversary of the US atomic bombings of Hiroshima and Nagasaki, is a good place to start.

55th part

The spiritual savor of being a people

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HE word of God also invites us to recognize that we are a people: “Once you were no people, but now you are God’s people” (1 Peter 2:10). To be evangelizers of souls, we need to develop a spiritual taste for being close to people’s lives and to discover that this is itself a source of greater joy. Mission is at once a passion for Jesus and a passion for His people. When we stand before Jesus crucified, we see the depth of His love, which exalts and sustains us, but, at the same time, unless we are blind, we begin to realize that Jesus’ gaze, burning with love, expands to embrace all His people. We realize once more that He wants to make use of us to draw closer to His beloved people. He takes us from the midst of His people and He sends us to His people; without this sense of belonging, we cannot understand our deepest identity.

Jesus Himself is the model of this method of evangelization, which brings us to the very heart of His people. How good it is for us to contemplate the closeness which He shows to everyone! If he speaks to someone, He looks into their eyes with deep love and concern: “Jesus, looking upon him, loved him” (Mark 10:21). We see how accessible He

Bloomberg View

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AMPAIGN finance reformers have been on a steady losing streak in the courts and Congress. But they may finally have found a champion who can elevate their cause: Pope Francis.

“We must achieve a free sort of election campaign, not financed,” the pope told an Argentine magazine in an interview released this week. “Because many interests come into play in financing

of an election campaign and then they ask you to pay back. So, the election campaign should be independent from anyone who may finance it.”

To drive his point home, the pontiff added: “Perhaps public financing would allow for me, the citizen, to know that I’m financing each candidate with a given amount of money. The pope’s remarks come in the midst of corruption scandals in his native Argentina. But American advocates of curbing the influence of big money in politics were eager to seize on his message. “We have just gained a great

cross is nothing else than the culmination of the way He lived His entire life. Moved by His example, we want to enter fully into the fabric of society, sharing the lives of all, listening to their concerns, helping them materially and spiritually in their needs, rejoicing with those who rejoice, weeping with those who weep; arm in arm with others, we are committed to building a new world. But we do so not from a sense of obligation, not as a burdensome duty, but as the result of a personal decision which brings us joy and gives meaning to our lives.

Sometimes we are tempted to be that kind of Christian who keeps the Lord’s wounds at arm’s length.

Yet, Jesus wants us to touch human misery, to touch the suffering flesh of others. He hopes that we will stop looking for those personal or communal niches which shelter us from the maelstrom of human misfortune, and instead enter into the reality of other people’s lives and know the power of tenderness. Whenever we do so, our lives become wonderfully complicated and we experience intensely what it is to be a people, to be part of a people.

It is true that in our dealings with the world, we are told to give reasons for our hope, but not as an enemy who critiques and condemns.

We are told quite clearly: “do so with

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gentleness and reverence” (1 Peter 3:15) and “if possible, so far as it depends upon you, live peaceably with all” (Roman 12:18). We are also told to overcome “evil with good” (Roman 12:21) and to “work for the good of all” (Galatians 6:10). Far from trying to appear better than others, we should “in humility count others better” than ourselves (Philippians 2:3). The Lord’s apostles themselves enjoyed “favor with all the people” (Acts 2:47; 4:21, 33; 5:13). Clearly, Jesus does not want us to be grandees who look down upon others, but men and women of the people.

This is not an idea of the pope, or one pastoral option among others; they are injunctions contained in the word of God which are so clear, direct and convincing that they need no interpretations which might diminish their power to challenge us.

Let us live them sine glossa, without commentaries. By so doing, we will know the missionary joy of sharing life with God’s faithful people as we strive to light a fire in the heart of the world.

To be continued For comments, e-mail caritas_manila@yahoo.com. For donations to Caritas Manila, call 563-9311. For inquiries, call 563-9308 or 563-9298.

Fax: 563-9306.

An unsolicited advice for President Aquino

courage and foresight are unmatched by today’s standard, sponsored and defended the joint resolution. Among his peers who strongly endorsed it were Senators Aquino Jr., Salvador Laurel, Jovito Salonga, Dominador Aytona, Ernesto Maceda, Ambrosio Padilla, Arturo Tolentino, Gil Puyat and Gerardo Roxas, then president of the Liberal Party.

While Diokno defended the Magna Carta on the floor, it was Speaker Laurel who did the same in the House. With him was Justiniano N. Montano, then minority floor leader. Among the most skillful lawmakers who supported it were Cornelio T. Villareal, Joaquin Roces and Jose Yap. The ones who legally and technically assisted the Senate and the House in finalizing the Magna Carta were Isagani Cruz, who became associate justice of the Supreme Court, and Emmanuel Q. Yap, the first director general of the Congressional Economic Planning Office, who also assisted Laurel in the consultation with the private sector.

The Magna Carta is reflected in Section 7, Article II, of the 1987 Constitution, which, by the way, was framed largely on the initiative of the late President Corazon C. Aquino. The section mandates that: “The State shall pursue an independent

foreign policy. In its relations with other states, the paramount consideration shall be national sovereignty, territorial integrity, national interest, and the right to selfdetermination.”

For 46 years now, this law has not been implemented because of strong foreign interventions and this is why the country has remained agrarian, violent, a mere labor and raw-materials exporter and a huge consumer of imported products in a region vibrating in modern industrial economy, cyber communications and sophisticated transportation.

Harvard-trained lawyer-economist Ding Lichauco said: “So crucial and imperative was the state objective legislated by the Magna Carta that even after Marcos had dissolved Congress, he never lost sight of the document’s overriding objective. He saw the enduring validity of its central proposition: that the nation must industrialize if it is to survive. The Magna Carta was founded on that imperative. The very security of the state, military and not only economic, ultimately depends on that. Even social justice depends on that.

“In this space and nuclear age, a nation that is not industrialized is an economic paraplegic that counts for nothing in the intensely competitive community of nations. It might as well be transported back to the Dark Age. Even its military establishment can only be a standing joke because it must depend even for its boots and shoe polish on others.

“It is not a coincidence that the two most dynamic NICs in Asia, South Korea and Taiwan, were propelled to their spectacular condition by political and military leaders: Park Chung-hee (South Korea) and Chiang Kai Shek (Taiwan). Because more so than the civilian mind, the military easily grasps the strategic value of industrialization, particularly an

industrialization based on industries precisely contemplated by the Magna Carta: industries that would make a nation self-sufficient in machineries and industrial raw materials; industries founded on steel and metals.

“To Park, the steel industry was important not for the number of people that it could employ, but for the strategic material it represented. To develop the capacity to produce that strategic material was worth the cost, any cost. And events vindicated him.

Another country much closer to home that is frantically trying to industrialize is Indonesia, a nation also led by a sagacious militarist who realizes the economic-military value of an industrialization based on the heavy industries.

“This was what Marcos grasped.

That was why in 1976 he pressed for the speedy implementation of an integrated steel mill that had been on the drawing board since 1958, and three years thereafter directed the installation of 11 major industrial projects. By 1979, he had begun to panic because he saw that South Korea and Taiwan had sprinted beyond reach in the developmental race. South Korea began the construction of her steel, engine and machine industries as early as 1969, while Taiwan did so in the mid-1970s.

“And so Marcos, not to be outdone, in 1979 formally announced a program that would give the nation the projects needed to launch the country into the industrial age by early 1980s.”

In launching the 11 major industrial projects, he warned: “If we do not shift gears and get on the same fast track [as our neighbors] we would not be able to catch up and shall be left to receive the dust of those we follow.”

control debate. And he stunned some conservatives when he expressed tolerance toward homosexuals. “If someone is gay, who searches for the Lord and has goodwill, who am I to judge?” he said.

Brian Burch, president of Catholic Vote, a conservative group with 500,000 members, interpreted the pope’s campaign finance rhetoric as a product “of exasperation with a culture of corruption in his home country, and perhaps others.” Burch noted, however, that there is no official church doctrine on funding campaigns. “It remains perfectly accept-

able for Catholics in the United States to prefer our own election system that relies on voluntary donations, robust free speech and transparency,” he said.

The Catholics on the Supreme Court no doubt agree. Catholic Justices Samuel Alito, Anthony Kennedy, John Roberts, Antonin Scalia and Clarence Thomas formed a majority that has dismantled campaign-finance regulations on First Amendment grounds—including the court’s ruling in the Citizens United case, which paved the way to unrestricted spending on electioneering. (Associate

Justice Sonia Sotomayor, another Catholic, dissented in the case.) “The Supreme Court has opened the floodgates to unlimited spending by corporations, unions and individuals,” said Trevor Potter, president of the Campaign Legal Center. “What the pope is pointing out is that it doesn’t have to be the only way elections are funded.”

The pope will have an opportunity to expand on his campaign-finance views in September, when he is scheduled to speak before a joint session of Congress. He was invited to appear by House Speaker John Boehner and Pelosi. Both are Catholic.

Cecilio T. Arillo

database

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ERE’S an unsolicited advice for President Aquino if he wants to leave behind a great legacy of his own, perhaps far greater in history than any of his predecessors and, in the process, perpetuate the memories and ideals of his parents and save our people from the bondage of poverty and lawlessness, including a possible war in Mindanao:

Implement an existing law—The Magna Carta of Social Justice and Economic Freedom or Joint Resolution 2, passed jointly by Congress and enacted into law on August 4, 1969. You may not know it, but one of those who sponsored and signed this document was your father, Sen. Benigno Aquino Jr., now a martyr.

The President can use this law to strengthen the Autonomous Region in Muslim Mindanao by fusing a revised Bangsamoro basic law (BBL) into it and by turning the area into an industrial hub, using the P75 billion the BBL needs to implement. You may then issue a general amnesty for all illegally possessed firearms and exchange them with farm and fishing facilities to create food security for the region while it moves for rapid industrialization.

I was then a Manila Times reporter covering city hall and had to walk daily to the original Congress nearby in my spare time just to listen to the debate of the Magna Carta. It was not an ordinary legislation. Indeed, it was a product of serious and extensive public hearings by a Congress whose members reflected independence, brilliancy and high mindedness that drew my personal attention.

The Senate Committee on Economic Affairs, headed by the late Jose W. Diokno, whose intellect,

The pope vs Citizens United

By Jeanne Cummings

is, as He draws near the blind man and eats and drinks with sinners (cf. Mark 2:16) without worrying about being thought a glutton and a drunkard Himself (cf. Matthew 11:19). We see His sensitivity in allowing a sinful woman to anoint His feet (cf. Luke 7:36-50) and in receiving Nicodemus by night (cf.

John 3:1-15). Jesus’ sacrifice on the

Saturday, March 14, 2015

new ally with a worldwide voice for publicfinancing campaigns,” said Fred Wertheimer, founder of Democracy 21. “We greatly appreciate his words and wisdom on this subject.” Drew Hammill, a spokesman for House Democratic Leader Nancy Pelosi, similarly embraced the pope’s “call for an end to the contaminating influence of money in our democracy.”

The pope has not shied from political controversy. On a January visit to the Philippines, he said Catholics don’t “have to be like rabbits,” seemingly opening an uncertain new chapter in the birth-

To reach the writer, e-mail cecilio. arillo@gmail.com

2nd Front Page BusinessMirror

A8 Saturday, March 14, 2015

New glut concern emerges as oil refiners ramp up output

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s crude prices stabilized in recent weeks, following their collapse last year, one of the key reasons analysts pointed to was bargain hunting by oil refiners.

Don’t expect it to last.

Global refining has surged so much— it rose the most since 2010 in the fourth quarter—that it risks creating a glut of fuel products that prompts operators to scale back their purchases of crude, according to firms, including Morgan Stanley and Wood Mackenzie Ltd. That, in turn, could start pushing oil prices back down, they say.

“Refiners may run very hard over the next few months, which is supportive for crude-oil balances near term, but they could flood product markets again,” Adam Longson, an analyst at Morgan Stanley in New York, said by phone on March 10.

Brent futures have rebounded 23 percent to $57.18 a barrel on the Londonbased ICE Futures Europe exchange at 12 p.m., Singapore time, from the five-year low reached on January 13. While the recovery has been aided by the demand from refiners, a surge in fuel use among consumers hasn’t yet materialized, according to the International Energy Agency (IEA), a Paris-based policy adviser to 29 nations.

BSP unlikely to cut key policy rates–analysts

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By Bianca Cuaresma

he Bangko Sentral ng Pilipinas (BSP) was seen unlikely to follow its peers in Thailand and South Korea, whose monetary policy-makers trimmed interest rates in separate bids to boost their respective economies, a regional banking giant said.

In commentaries released on Friday following the monetarypolicy adjustments by the central banks of South Korea and Thailand, DBS Bank said the BSP was loathe to put additional pressure on loan growth by keeping the

overnight borrowing rate steady at 4 percent the rest of the year.

“Following the surprise rate cuts in Thailand and South Korea this week, markets are guessing at who is next to cut in the region. The BSP is one obvious candidate. CPI

[consumer price index] inflation has been falling in recent months, and the peso is now the best-performing Asian currency against the dollar in the year-to-date,” analysts at DBS Bank said.

“It is highly unlikely, however, to see the BSP trimming its rates,” the analysts added.

According to DBS, the BSP will likely keep its interest rates on hold, as the country’s main economic indicators are doing well on sustained basis.

“Gross domestic product [GDP] growth is set to remain above 6 percent this year. While CPI inflation has been soft, at an estimated average of 3.2 percent this year, it is still within the official 2-percent to 4-percent target. And on the peso, it is important to note that

foreign inflows have been robust,” DBS said, noting record-high inflows in the form of foreign direct investments and remittances in 2014.

Given this backdrop of macroeconomic stability, DBS Bank analysts saidthecentralbankwaslikelytotake keep the rates at which they borrow from or lends to banks where they are and begin the phased adjustments only in 2016.

“We have previously penciled in a 25-basis-point rate hike in the fourth quarter of 2015.

This is likely to be delayed until early-2016. But the BSP is unlikely to make a sharp turn in its policy trajectory. Expect the overnight borrowing rate to remain steady at 4 percent for the rest of the year,” DBS Bank said.

Bloomberg News

DBS Bank also said the BSP “may even tinker” with its special deposit account interest rates during the year to balance risks stemming from fiscal expansion.

The central bank of Thailand cut its main rate to 1.75 percent to prop up a weaker-than-expected economy, followed by the Bank of Korea’s decision trimming its rate also to 1.75 percent as a preemptive strike against prospectively weaker demand down the line.

The rate cuts were a surprise to financial markets and was not foreseen in polls conducted by private sector economists. The BSP will next deliberate on the direction of domestic interest rates on March 26, when the seven-man Monetary Board meets again.

PHL resisting rate-cut wave spoils returns

Runs increased

Idled refining capacity is at 2.96 million barrels a day, the lowest for the time of the year since at least 2009, according to data compiled by Bloomberg. Processing totaled 78.1 million barrels a day worldwide last quarter, a gain of 2 million from a year earlier, according to the IEA. Half of the increase was in Europe.

The profit from producing gasoline in northwest Europe climbed to $14.48 a barrel on March 11, the most in almost a year, according to data from PVM Oil Associates.

European refiners have shut about 15 plants since 2008, according to the IEA, the biggest wave of closures since the 1980s, as recession curbed fuel demand and more efficient plants opened in Asia and the Middle East. Oil workers at refineries in the US have been holding their largest strike since 1980.

Profit strengthened in the fourth quarter and early 2015, Italian oil refiner Saras SpA said when it reported earnings on February 24. Higher refining margins in most regions supported Royal Dutch Shell Plc.’s earnings in 2014, the company said on January 29. Fourth-quarter processing earnings at Repsol SA improved by a third, from a year earlier to $5.50 a barrel, Spain’s largest oil company said on February 26.

www.businessmirror.com.ph

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digital technology for smes Harry Lee (from left), Samsung Philippines managing director; Kat Luna-Abelarde, PLDT first vice president and head of SME Business;

Diana Tibbs, Microsoft Philippines director for small, midsize solutions partners; and Eric Alberto, PLDT executive vice president and ePLDT president and CEO, at the launching of new broadband packages that will empower 800,000 small- and medium-enterprise market segment through innovative and digital technology, in partnership with PLDT, Microsoft Philippines and Samsung Philippines. With the partnership, a new set of packages has been made that has supercharged flexible freebies, ranging from relevant and businessenabling cloud solutions, such as Microsoft 365 and PLDT Cloud apps, and choose the latest array of smart devices from Samsung Philippines. Story on A1. Stephanie Tumampos

‘Insurers have more room for growth Continued from A1

days through investments in insurance products and other savings instruments.

“The Philippines has a very low savings rate, compared to other Asean countries. While this is admittedly a weakness, we should also view it as an opportunity. In a study made in 2013, only one-fourth of the households surveyed have savings, and only two-thirds of them have bank accounts,” Dooc said.

“So a significant number of Filipinos just keep their money under their pillows. Convince them that it is a lot safer that Fortune Life should keep their money in the form of premiums” instead, he said.

Dooc said the regulatory reforms adopted in recent years by the local insurance industry resulted to an industry more prepared to meet the competition seen to toughen up soon when the Asean economic integration starts at the end of this year.

He said the local insurance industry has lived up to the challenge of the Asean integration as indicated by the figures posted last year that saw the total assets of local insurers breaching the P1-trillion mark. Total insurer investments have also grown large to P860 billion, half of which are in the form of government securities. Dooc particularly cited Fortune Life for its good performance, despite last year having been a “difficult year” for the industry.

“Despite a difficult year last year, Fortune Life was one of the few life insurance companies that posted growth. It posted P1.55-billion premium income in 2014, compared to only P1.041 billion in 2013. And you don’t even sell variable universal life insurance policies.

You have no single premium revenues which largely accounts for the revenues of the others,” Dooc said. Fortune Life President D. Arnold A. Cabangon attributed the growth in the sales of Fortune Life to the hard work and the dedication of its staff for whom the awarding ceremonies were held.

“I am happy to see an increase in the number of awardees this year. The young are on the lookout, and eager to grab hold of new opportunities as they open up, and those who are already established are challenged not be content, but, instead, to be innovative,” Cabangon said in honoring the officers and staff of Fortune Life.

Among the awardees on Thursday night were Roberto Jabines (Insurance Specialist of the Year); Patricia Taguines (Agency Manager of the Year); Tranquilino Daigdigan (Field Manager of the Year and Agency Builder of the Year); Angela Guillermo (Jumbo Specialist of the Year and Quality Business Awardee); Roberto Jabines, Ines Jabines and Michael Jabines (SSI Specialists of the Year); Maritess Duga and Pearly Ann Allarey (Group Insurance Specialists of the Year); and Michael Jabines (Group Field Manager of the Year).

he fastest economic growth in Southeast Asia is taking its toll on Philippine bonds as the central bank resists cutting interest rates and investors switch to stocks.

Sovereign peso notes fell 2.4 percent since reaching a record high on February 2, and are on track for the biggest two-month loss in a year, a Bloomberg index shows. That’s pared three-month returns to 0.6 percent, the worst among Southeast Asian emerging markets. The Philippine benchmark share gauge is the region’s best performer in 2015, rallying 8.4 percent, as the economy grew 6.9 percent in the fourth quarter.

Government Service Insurance System (GSIS), the nation’s biggest pension fund, is seeking to increase the proportion it can invest in equities as returns from bonds shrink, President Robert Vergara said in an interview on Wednesday. The Bangko Sentral ng Pilipinas (BSP) sees no reason to change monetary policy, Deputy Governor for the Monetary Stability Sector Diwa C. Guinigundo said last week, damping speculation it will join Asian counterparts, including China, Indonesia and Thailand in cutting borrowing costs.

“Headwinds are against the bond investor,” Frederico Ocampo, who helps manage $19 billion as the Manila-based chief investment officer at BDO Unibank Inc., the country’s largest money manager, said in a March 6 interview. “We are growing at a time when many markets are struggling.”

Indonesian local-currency sovereign debt has rallied 4.1 percent over three months, ringgit notes advanced 1.9 percent and Thai securities increased 0.9 percent, according to Bloomberg indexes.

BDO’s retail clients are favoring stocks because of “uncertainty” in the debt market as the US prepares to increase borrowing costs, Ocampo said. GSIS, which has about P860 billion ($19.4 billion) of investible funds, will ask its board to raise the limit on equities to 30 percent of assets from 20 percent, Vergara said.

The Philippine economy will expand 6.35 percent this year, from 6.1-percent in 2014, according to the median forecast of analysts surveyed by Bloomberg. That’s up from a November projection for 6.1 percent growth. Gross domestic product in Indonesia and Malaysia will increase 5.39 percent and 4.75 percent, respectively, separate surveys show.

The BSP has held its benchmark rate at 4 percent since raising it by 25 basis points each in September and July last year.

Borrowing costs will remain unchanged through 2015, according to a Bloomberg survey in February, compared with a prediction for half a percentage point of increases in a November poll.

See “Rate-cut,” A2