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Monday, May 29, 2017 Vol. 12 No. 228

Violence to worsen poverty in Lanao del Sur–experts By Cai U. Ordinario

@cuo_bm

he uncertainty caused by the siege in Marawi City would aggravate the poverty situation in Lanao del Sur, which remains as the poorest province in the Philippines, according to analysts. Lanao del Sur, based on the 2015 Poverty Statistics, is the poorest province nationwide with a poverty incidence rate of 71.9 percent in 2015. This means that 7 out of 10 residents of the province are poor.

‘Palace must certify tax reform bill as urgent’ By Jovee Marie N. dela Cruz

@joveemarie

he chairman of the House Committee on Ways and Means last Sunday said the Department of Finance (DOF) has asked Malacañang to certify as urgent the Duterte administration’s first tax-reform package—the Tax Reform for Acceleration and Inclusion (TRAIN). PDP-Laban Rep. Dakila Carlo E. Cua of Quirino said the urgent certification is needed to allow the lower chamber to approve the bill on third reading before Congress’s last session day on Wednesday. The lower chamber can only vote a measure on third reading after copies of the bill that passed second reading are given to members of the House at least three days prior to voting. According to Cua, the lower chamber is seen See “Tax reform,” A2

The province’s capital city, Marawi, had a poverty incidence rate of 60 percent, based on the Philippine Statistics Authority’s (PSA) Small Area Estimates in 2012. “Poverty depends on income and livelihood,” Philippine

Institute for Development Studies (PIDS) senior research fellow Jose Ramon G. Albert said. “Livelihood ultimately depends on peace, law and order, and a good investment climate.” PIDS senior fellow Roehlano M. Briones said poverty incidence may increase, especially in areas where there is fighting. Briones added the loss of livelihoods, including farming, which is common in rural areas, are some of the “localized effects” of the siege of Marawi City. This also the reason University of Asia and the Pacific School of Economics Dean Cid Terosa said the rest of Mindanao will suffer minimal impact from the fighting. See “Violence,” A2

BMReports Technology, economy boost pawnshops in PHL By Rea Cu

@ReaCuBM

Part One

HE pawnshop industry in the Philippines is expected to grow in the next few years, adapting to changes that the age of Internet and digital technology present. According to a report by Luis Buenaventura of Quartz Media Llc., the Internet is revolutionizing the pawnshop industry, specifically in the Southeast Asian region. “The Internet is beginning to revolutionize the sector in Southeast Asia, five years after Colorado-based PawnGo helped pioneer online pawnbroking elsewhere,” said the report, titled “Pawnbroking is huge in the Philippines—and

PESO exchange rates n US 49.8750

it’s going online”. This began in the Philippines with the entry of PawnHero Pawnshop Philippines Inc. (PawnHero) in February 2015. PawnHero said it enables customers to upload photos of the things they want to pawn online. After answering a few questions, the customer w ill receive price quotes for their items directly from PawnHero. “If the user accepts the quote offered, their item is retrieved by a courier, who gives them an empty debit card,” said the Quartz Media Llc. report published in November last year. “Once PawnHero has appraised the item in person, the debit card is topped up.” According to Buenaventura, the format that PawnHero

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PPP Conversations #5 with LLDA PPP Lead

n May 24 the Philippine Reclamation Authority, led by its General Manager (GM) Janilo Rubiato, and the Laguna Lake Development Authority (LLDA), represented by GM Jaime Medina, signed an Expression of Cooperation (EOC). The cooperation sets in motion two strategies aimed at advancing President Duterte’s “Build, Build, Build” program along Laguna Lake. Continued on A15

ICTSI MASTERS ICTSI PHILIPPINE PHILIPPINE MASTERS

provides customers in terms of pawning is a safer option in the Philippines, since the majority of where Filipinos can borrow money end up being through loan sharks.

Secondhand items

ON its web site, PawnHero not only allows jewelry to be pawned but secondhand items, as well. The centralized appraisal center of the company was noted to use modern technology, enabling for a fair and accurate appraisal of the items uploaded. “PawnHero charges interest dependent on the item you are pawning and the loan duration you choose,” according to the PawnHero Philippines web site. “In short, with interest rates Continued on A2

MONDILLA RISING Clyde Mondilla and his caddie are in a relaxed mood, as they wait their turn during the final round of the International Container Terminal Services Inc. Philippine Masters at the Villamor Golf Club. Mondilla won the crown by one stroke over Tony Lascuña, Jhonnel Ababa and American Nicolas Paez with a closing 70. Story on C3. MIKE BESA

n japan 0.4460 n UK 64.5432 n HK 6.4015 n CHINA 7.2593 n singapore 35.9771 n australia 37.1669 n EU 55.9199 n SAUDI arabia 13.3004

Source: BSP (26 May 2017 )

A2 Monday, May 29, 2017

BMReports BusinessMirror

Technology, economy boost pawnshops in PHL Continued from A1

as low as 2.99 percent, PawnHero charges one of the lowest interest rates in the Philippines.” Under the platform or system of pawnbroking, cash offers tend to be less than 50 percent of the collateral’s actual cost, and a monthly interest rate of 3 percent or higher is added to the outstanding balance. Pawnshops also place a service charge of up to 2 percent. T he report further added that in the country, pawnshops are as common as automated teller machines (ATMs), since the absence of traditional credit or banking options increases the citizens need for a platform that will generate funds quickly

Violence. . .

Continued from A1

“Poverty in Marawi City will most probably worsen but poverty in the other poorest provinces in Mindanao will not be drastically affected. Investors and businessmen have moved away from the blanket notion that peace and order in the entire Mindanao is worrisome,” Terosa said. Nonetheless, Ateneo de Manila EagleWatch senior fellow Alvin Ang said the negative impact of the siege makes it “imperative” to resolve the issue immediately and decisively. “The current challenge must be addressed soonest and decisively. [There is a need to] settle the issue and prepare a reconstruction plan now for immediate implementation,” Ang said. Former Socioeconomic Planning Secretary Romulo A. Neri said he believes the government is already addressing the issue in Marawi City. If it is successful, Neri believes it will improve the region’s and the country’s economic prospects. In a recent forum organized by the University of the Philippines College of Mass Communication

or emergency loans. Around 90 percent of Philippine households was explained to be working with an estimated $10 or less budget a day, which makes for the Philippines to house around 18,500 pawnshops. “O ver t he cent u r ies, t he pawnshop business model hasn’t changed,” the Quartz Media report said. “But in the developing world, the industry has grown enormously.” According to the Quartz Media report, the Philippines now has one pawnshop for ever y 3,200 adults. “For the same slice of the population, there are only about two registered physicians.” Paw nHero is du ly i ncor porated in the Philippines and licensed by the Bangko Sentral ng and the Honolulu-based East West Center, Neri said more than economic growth, Filipinos in these areas must be able to benefit from the growth felt in select cities nationwide. This is because GDP measurement does not take into consideration social costs, such as pollution and traffic, as well as economic and social equity and entitlement issues. He added that GDP is also silent on the ill effects of destructive expenditures, such as cutting down virgin forests and the depletion of natural resources. Felipe Medalla, also a former socioeconomic planning chief, said the imposition of martial law in Minadnao will have “minimal” impact on the economy because that imposed by the late-President Ferdinand E. Marcos. “To me, the difference I’ve seen now is there’s no talk about shutting down the media, there’s no talk about limiting discussions, and so forth. Maybe he [President Duterte] knows something we don’t know. If, for instance, there is an international coordination of terrorism, that would not be easy,” Medalla said. Last Saturday the National Economic and Development Au-

Pilipinas (BSP). Its operations in the country is headed by its president, Nico Jose S. Nolledo.

Markets and trends

A report, titled “Philippines Pawnshop Market Outlook to 2020 —Convenience with Pawning and Remittance Services to Stimulate Growth,” the poor functioning of the banks in the Philippines have provided a higher popularity to other informal sources of credit, such as pawnshops. “Pawnshops these days have been growing at a remarkable pace in terms of their reach and the credit provided to the people,” said the report by Ken Research Private Ltd and published in April last year. According to BSP data, unthority (Neda) said it “acknowledged” the “seriousness of the crisis situation in Lanao del Sur centered in and around Marawi City”. Ho we ve r, S o c io e conom ic Planning Secretary Ernesto M. Pernia said economic growth cannot be sufficiently sustained nor be inclusive without peace. This is why achieving peace, Pernia said, security and public order is considered a bedrock strategy under the Philippine Development Plan (PDP) 2017-2022. “Having the watchful eye of government forces, especially in Mindanao, will ease tensions and allow communities to live normally,” Pernia said.

Martial law

Lawmakers last Sunday said addressing the violence and war first in Mindanao will help the government to eradicate poverty in the area. House Committee on Appropriations and National Unity Party Rep. Karlo Alexei B. Nograles of Davao City said the country’s development, particularly in Mindanao, cannot be achieved without total peace and order. “We cannot turn a blind eye

der the consolidated statement of condition for 2014, total assets recorded for the pawnshop industry reached P40.837 billion, which was up by 19.1 percent, from the P34.266 billion in 2013. Broken down, cash on hand accounted for P5.087 billion for 2014, checks and other cash items accounted for P76 million, deposits made in banks reached P1.447 billion, loans and advances took P25.727 billion of the pie, investments in bonds and other government securities saw P12 million, and equity investments were at P17 million, among others. The gross assets related to corollary business was at P3.706 billion for the year, up by 96.5 percent compared to the P1.886

billion in 2013. “Lack of credit facilities, lower credit-card penetration and incomplete credit histories has prompted the borrowers to resort to the pawnshops since they require just a valid identity proof and collateral to provide the credit,” the report said. While liabilities for the industry in 2014 totaled P20.088 billion, up by 36.5 percent, from the P14.708 billion in 2013. Of the total, P11.975 billion was for loans and notes payables, acrrued taxes and other expenses was provided P1.063 billion, unearned income and other deferred credit had P130 million, liabilities related to corollary business were given P1.244 billion, and other liabilities accounted for P5.676 billion. To be continued

on the presence of armed bandits and terror groups in Mindanao,” Nograles said in a text message to the BusinessMirror. Nograles also backed the declaration of martial law to address terrorism in Mindanao. “The President is correct in dealing harshly with them because their objective is to sow terror and keep Mindanao poor and scared,” he said. In the same manner, Nograles said nothing will stop the government from pouring resources into Mindanao. “There is a proper balance in dealing with the situation in Mindanao, and the President knows and understands this because he is from Mindanao,” he added. For his part, Liberal Party Rep. Teddy Brawner Baguilat Jr. of Ifugao, legitimate minority leader, said it has been validated throughout history that the country can never eradicate poverty in Mindanao for as long as there is violence and war in the area. “And violence in Mindanao will continue if we do not address the inequalities between the poor and the privileged warlords of the island,” Baguilat said. “Pover t y a nd despa ir are

pushing the younger Muslims of Mindanao to rebellion and extremism.” However, Baguilat said martial law is not a “long-term solution” to underdevelopment in Mindanao. House Majority Leader and PDP-Laban Rep. Rodolfo C. Fariñas of Ilocos Norte said the lower chamber will meet as a Committee of the Whole House on Wednesday to consider the martial-law report of the Palace and will decide whether it will move for the revocation of the proclamation. “A joint session needs the concurrence of both Houses. If the majority of each House wants a Joint Session, each will adopt a Concurrent Resolution for that purpose,” Fariñas said. “The position of each legislator may be expressed in the sessions of the House and the Senate when they separately consider the Report of the President. If either House finds that there is no need to revoke the martial-law proclamation of the President, a Joint Session may not happen,” he added. Fariñas said the Senate will consider the report of President Duterte on Monday. With a report from Jovee Marie N. dela Cruz

www.businessmirror.com.ph

Tax reform. . . Continued from A1

approving the tax-reform bill on second reading today (Monday). “I am proposing to have second reading vote on Monday. I believe the bill has been discussed thoroughly and has the support of the majority of our colleagues,” Cua said. Deputy Speaker and Liberal Party Rep. Romero S. Quimbo of Marikina City, a former chairman of the House Committee on Ways and Means, said President Duterte has to certify the bill as an urgent measure if the lower house wants to approve it on final reading this week. “ T he third reading approval of TRAIN is possible only if the President certifies the bill as urgent. Under our rules, we can only vote a measure on third reading if copies of the second reading bill are provided the members at least three days prior to voting. There are only three session days left and no second reading approval yet. Without the presidential certification, it’s now a physical impossibility,” Quimbo said.

Intact

Meanwhile, Cua admitted the original provisions of TRAIN are still intact in the bill. However, Cua said they may still include the lawmakers’ individual amendments during the period of amendments or before the second reading approval on Monday. Last week lawmakers have submitted their individual amendments to House Bill 5636, or the TRAIN. For his part, Party-list Rep. Rodel M. Batocabe of AKO Bicol, said he is hoping that a compromise agreement will be reached, or they abstain during the voting if their request to scrap the provision lifting VAT exemption of cooperatives is ignored. “It will be grossly unfair for our taxpayers to subsidize cooperatives, which is the DOF counterproposal if and when co-ops are subjected to tax. Co-ops are suigeneris, a different kind of sector designed more appropriately as social enterprises to encourage self-help and entrepreneurship to enhance inclusive economic growth, especially in the countryside. Exempting them from VAT is one way of promoting coops among our people. Being a self-help organization, it is anathema to their inherent nature to beg for subsidy or doleouts to the government,” Batocabe said. For his part, Nacionalista Party Rep. Luis Raymond F. VillafuerteJr. of Camarines Sur said the proposal was designed to cut income-tax rates for the benefit of low-income workers and, at the same time, help raise money for the Duterte administration’s massive expenditure program to lift 6 million Filipinos out of poverty and transform the Philippines into an upper middle-income country by 2022. “Let’s help realize our v ision to eradicate extreme poverty in one generation or by 2040 and make the Philippines a high-income or advanced economy by that time,” Villafuerte said. The tax-reform package seeks to lower personal income-tax rates, expand the VAT base, adjust excise taxes on petroleum and automobiles, impose excise tax on sugar sweetened beverages and ease the rates of estate and donor’s taxes. The leadership of the lower chamber has already expressed confidence the tax package will be passed before its sine die adjournment on May 31. The bill provides provisions on e-receipts issuance and transmission, fuel marking, point of sales machines linkage to the Bureau of Internal Revenue (BIR) and linkage between the BIR and government agencies/bureaus/offices. It also provides for 20-percent income tax for lotto winnings. Under the measure, for three years, not more than 40 percent of the yearly incremental revenues generated from the proposed petroleum excise tax shall be allocated to fund social benefit programs, and include the granting of fuel vouchers to qualified transport franchise holders. The bill also provides that for the same period, the remaining yearly incremental revenues shall be allocated for infrastructure, health, education and social-protection expenditures. The revenue loss to lower personal income tax may reach P140.1 billion, while the revenue gain is expected at P187.7 billion for a full-year implementation.

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Book suppliers seek Duterte’s help on DepEd policy on reading materials By Claudeth Mocon-Ciriaco Correspondent

ACK of supplemental reading and reference materials has adversely affected the quality of education in the country, book suppliers said on Sunday. This was revealed by the National Book Suppliers and Publishers Association of the Philippines (NBSAP) as it appealed to President Duterte “to put sanity and order in the procurement of books at the Department of Education [DepEd] including the full implementation of Republic Act [RA] 8047 for the development of the book publishing industry”. “For almost a year, much was expected from President Duterte to effect meaningful change in our society, including minimizing red tape, eliminating redundant procedures and documentation, processing time will be faster and prompt action will be done on people’s complaints. However, it is unfortunate that this is not happening in many agencies to include the DepEd,” NBSAP Spokesman Lucy Carrasco said in a statement. NBSAP President Florinia S. Espiritu Santo earlier appealed to Education Secretary Leonor M. Briones in a letter on July 18, 2016, but the association only received a formal reply on April 25, 2017 stating that the DepEd will study the proposal in reference to RA 9184 and other existing policies and regulations.

Espiritu Santo clarified that NBSAP holds Briones in high esteem and respect whose integrity remains unsullied but she has to navigate a department that has still holdover officials who continue with the same failed policies and procurement procedures on supplementary, reading and other instructional materials. Sources at the DepEd point to two holdovers undersecretaries from the Aquino administration, who are allegedly in control of the procurement and printing of textbooks and instructional materials, as well as on the book supplies’ procurement policies and guidelines. After three years of stalling the suppliers and publishers owing to the moratorium on the procurement of supplemental reading, reference and other instruction materials he issued on September 26, 2013 (DepEd Order 44), former Education Secretary Armin A. Luistro issued DepEd Order 53 on June 29, 2016, that lifted the moratorarium until December 2016 that all but trimmed down approved published materials from 2,000 to only 765 books, mostly foreign books which by virtue of DO 96, s. 2010 were exempted from evaluation and automatically approved. NBSAP said DepEd Order 44, s. 2013, practically “eliminated us, publishers catering to the public schools out of the book trade. Three years when many of us have closed shops

or laid off our labor force due to total lack of business, the moratorium was lifted but did not come to us as a truly real resolution in spite of reports of lack of books in schools.” NBSAP also pointed out that since the DepEd is not supposed to earn (and it is not an Earning Agency), the conflict of interest borders on the seeming competition with the private sector in the book business. NBSAP noted that the budget for textbooks and other instructional materials has not been allocated for just procuring printing services but for the procurement of finished copies as indicated in the yearly annual national government budget. There is a special provision in the GAA that specifies “textbooks and other instructional materials upon order by the DepEd would be supplied by the private-sector publishers”. “Is calling ‘textbooks’ as ‘modules’ the reason the budget for textbooks is not used as intended?” NBSAP asked. On DepEd Order 52, Series of 2015, Carrasco noted “it appears that DepEd is going back to monopoly as producer-seller-buyer of books for the public schools, totally assuming the book publishing industry instead of helping uplift the economic condition in the country in general”. It was learned that current situation shows that a number of division offices have started developing their own learning materials in compliance with DO 52.

Editor: Dionisio L. Pelayo • Monday, May 29, 2017 A3

Legislator wants tougher law against cyber bullying

By Jovee Marie N. dela Cruz

@joveemarie

HE chairman of the House Committee on Good Government and Public Accountability on Sunday urged the leadership of the House of Representatives to suppress the growing menace of cyberbullying, including threats made through social-media posts, by passing a tougher law against cyber bullying.

In House Bill 4795, PDP-Laban Rep. Johnny T. Pimentel of Surigao del Sur seeks to reinforce the existing provisions of the Cybercrime Prevention Act and the Revised Penal Code against online harassment. Under the bill, the following acts shall be punishable by up to 10 years of imprisonment or a fine of up to P500,000 or both: Threatening a person via

text messaging, social-media posts or other electronic media; Placing a person in fear of imminent physical harm through text messaging, social-media posts or other electronic media; Engaging in willful, reckless or malevolent conduct that causes substantial emotional or psychological distress to a person by way of electronic media;

Sharing via social-media posts indecent, obscene, lewd and abusive remarks with sexual contents harassing the person of the victim; Posting remarks that induce, abet or incite others into threatening or harassing a person by means of text messaging, social posts or other electronic media; and Using fictitious social-media accounts in the commission of the preceding acts. The bill also provides that if the offender is “a person in authority or an agent of the law or both”, he or she shall suffer the accessory penalty of perpetual disqualification from public office, profession or calling. “We have to protect all individuals, regardless of gender, against all forms of electronic violence, including those that are not necessarily sexual in nature, but may be due to the victim’s race or religion or even political affiliation,” Pimentel said. “Our bill basically recognizes that anybody—even a male person —may possibly be tormented over the Internet for any reason, and this is what we seek to counteract,” he added. In Senate, Sen. Ana Theresia Hontiveros-Baraquel has already filed a bill seeking to criminalize the gender-based electronic violence against women, lesbians, gays, bisexuals and transgenders.

Economy

A4 Monday, May 29, 2017 • Editors: Vittorio V. Vitug and Max V. de Leon

BusinessMirror

Firms to hire fewer workers in Q3–survey

ocal businesses are looking to hire fewer new employees in the next quarter of the year, as firms expect tighter financial conditions and stale expansion plans during the period.

Latest data from the Bangko Sentral ng Pilipinas’s (BSP) quarterly Business Expectations Survey (BES) showed businesses will provide few-

er job opportunities for the Filipino working class in July to September this year, compared to the previous quarter, as the employment outlook

index declined to 24.7 from 27.4 in the earlier quarter. The index is computed as the percentage of firms optimistic about added employment plans minus the percentage of firms that indicated otherwise. A lower index means that the number of firms wanting to expand and hire more employees in the given period decreased, due largely to their perception on particular economic developments. “The employment outlook index for the next quarter remained

Ceza promotes new tourism destination in Cagayan

new tourism destination, which combines a scenic river, amazing natural attractions, varied f lora and fauna, an interesting agricultural community and a colorful festival, is beginning to draw a lot of visitors in Cagayan province. Casagan, an agricultural village first inhabited by Aetas in Santa Ana, Cagayan is now known for its bountiful rice fields and beautiful Tangatan R iver where villagers use a wooden boat called takuli to transport passengers and their agricultural products from the farm to the market. The river, a source of income and food for Casagan residents, offers a variety of fish and edible shells. A version of the story goes that the name of the village originated from the Aeta word casagan which means “a place to meet together”. Aetas were the first inhabitants in the barangay and used to build their huts along the riverbank. Clearing in the area began with the arrival of settlers from other areas who were drawn by fertile soil and nearby thick forest where narra, ipil and lawan grew. Casagan, thus, became an agricultural barangay and is now one of the rice

producers in Santa Ana. After its success with Palaui Island’s community-based sustainable tourism (CBST) program, the Cagayan Economic Zone Authority (Ceza) recognized and identified Casagan as its next area for CBST development. Ceza, in coordination with Casagan’s barangay unit and the Department of Tourism, officially launched Casagan as a new tourism destination in Cagayan Valley on May 14, 2016, in time for its annual colorful festival. Barangay Casagan celebrates a festival in honor of San Isidro Labrador in May. To promote Casagan as a destination, Ceza launched a tourism development program, dubbed “Casagan-all-youcan”, which sends a message of invitation to everyone. It has opened varied activities and interesting sites in the village. Casagan’s geography makes it an exciting destination for river-cruising. A cruise to the river offers a unique natural setting that is composed of varied f lora and fauna, such as the mangroves and trees, that grow along the river banks, the different species that include wild birds that migrate to the area during specific seasons and the firef lies that shine after sunset and before sunrise. T he v iew is made even more spect ac u l a r w it h t he su r rou nd ing f ield s a nd mou nt a ins, as t he boat reac hes t he end of t he r iver a nd t he st a r t of t he sea. A s one t a kes a cr u ise a long t he r iver, t he sight of t he ma n-made ha ng ing br idge add s a spect ac le to t he fasc inat ing stor y

of C asaga n. The river cruise also leads to one of the area’s gem—the La Mesa Falls. It is a natural waterfalls that is ideal for picnic, swimming and simply just nature-watching. The elevated rock formation of the waterfalls makes it a potential rappelling area. The elevated area can be reached 6.81 kilometers from Parada-Batu entrance and 5.92 kilometers from Tangatan entrance. Adding more spice to the Casagan experience is the use of takuli in the form of a wooden kayak boat. Riding a takuli does not only offer a unique experience but also shares a part of the local culture and tradition. The Casagan experience also introduces the salamangka, or cannonball, which is a fruit from a mangrove plant found along Tangatan River. Each salamangka fruit, which usually comes out during the summer season, bears a minimum of eight and a maximum of 19 distinctive seeds that, when detached, can make an interesting puzzle, thus the name. The fruit is dried and hardened to make a puzzle out of its seeds. A major attraction is the Takuli Festival, which will be held on May 12 to 14, 2017. The festival will include a thanksgiving Mass, a rice field parade and pluvial parade with Saint Isidore the Laborer, traditional takuli racing, wetshirt relay contest, Search for Ms. Takuli 2017, salamanca puzzle contest, family sack race relay, piglet hunting, carabao racing and barangay party. The Takuli Festival 2017 is a joint effort of Barangay Casagan, the local community and Ceza.

positive across sectors, although lower compared to the last quarter’s survey. This suggests that more firms will continue to hire new employees than those that indicated otherwise, although the number of new hires could be lower compared to the previous quarter’s survey,” the Central Bank said. Businesses also reported tighter financial conditions for the second quarter of the year, even worse than their conditions in the first quarter of 2017. Firms, however, said their financing requirements could be met through available credit, as businesses continue to see easy access to credit during the period. Expansion plans of businesses were also stale in the second quarter of the year, as their expansion outlook index slightly declined to 34.6 percent from the 34.9 percent in the previous quarter. Among subsectors, agriculture, fishery and forestry, mining and quarrying, and electricity, gas and water recorded stronger expansion plans, while those of manufacturing were slightly lower from a quarter ago. Firms in the country said domestic competition and insufficient demand are the top risks to business in the second quarter of 2017. Meanwhile, the percentage of respondents citing other business constraints, such as unclear economic laws, lack of equipment, financial problems and labor problems increased slightly from the previous quarter’s survey results. The BSP BES for the second quarter of the year had 1,485 surveyed firms nationwide—588 companies from the National Capital Region (NCR) and 897 companies from areas outside NCR. The survey was conducted in April to mid-May 2017 and the survey response rate was at 83.4 percent.

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‘Siege to hamper poverty data collection in some Mindanao provinces’ By Cai U. Ordinario @cuo_bm

he ongoing siege in Marawi City would make it difficult for the government to collect poverty data in some Mindanao cities and provinces, according to local statisticians. The government is set to conduct the Annual Poverty Indicators Survey (Apis) in July and this could be affected by the ongoing clash between government security forces and terrorists in Marawi City. The Apis is conducted by the Philippine Statistics Authority (PSA). This is the annual version of the Family Income and Expenditure Survey (FIES) conducted every three years and used as the primary basis for the country’s poverty data. “If a survey could be conducted at all, meaning a possibility too is that the PSA would not be able to come up with poverty rates in at least a number of Mindanao provinces/ cities,” former National Statistical Coordination Board (NSCB) Secretary-General Romulo A. Virola told the BusinessMirror over the weekend. Virola said if the situation in Marawi City is not resolved before June or July or by the time the Apis is being conducted, many residents could report a decline in their incomes. He also said this is a

possibility considering that the ones left behind in the city may not have the financial means to flee. However, Virola said this would render the collected data incomparable with previous poverty estimates collected in Marawi City. This prevents data users from comparing new and old data. Philippine Institute for Development Studies senior research fellow and former NSCB Secretary-General Jose Ramon Albert said, however, that data continue to be reliable at the regional level. “If households migrated out of Marawi with the same income but within the region, then there will be no effect, but as I said, this is all about business climate,” Albert said. The Apis is a nationwide survey conducted during the years when the FIES is not conducted. A full sample survey involves around 50,000 households. It aims to provide inputs to the development of an integrated poverty indicator and monitoring system, which would enhance timely, accurate and consistent production of poverty-related data that can be used at the national level. The Apis also supplements the identification of the poor families through the use of nonincome indicators. Hence, this survey provides information on the socioeconomic profile of families and other information relating to their living conditions.

Search on for PFA’s NxtGen in franchising

ot a business idea that can be the next big thing in franchising? The Philippine Franchise Association (PFA) calls for applications for the NxtGen in Franchising Award 2017. The competition is open to young entrepreneurs 35 years old and below having at least one operating store/prototype or proof of highly franchisable concept. “As we continue to help make the franchising sector in the country remain robust, we seek not only the trends and opportunities for our members to expand and become globally competitive, but we are also always on the lookout for fresh and innovative concepts that can be the next franchising success story. It is part of our commitment to help young entrepreneurs grow via franchising,” PFA President Dr. Alan Escalona said. Now on its third year, NxtGen in Franchising 2017 is searching for a new batch of emerging concepts to compete during the two-day conference Franchise Asia Philippines 2017 on July 19 and 20. “We want to raise the competition to the next level, so we decided to infuse the final judging at the International Conference of Franchise Asia Philippines 2017, where finalists vying for the award will pitch in front of a panel of experts and a thousand conference delegates,” said Sam Christopher Lim, PFA director for Special Projects & Digital Innovations and Franchise Asia Philippines 2017 Conference chairman. “Our conference attracts the biggest and successful franchisors and franchisees, so this is a perfect opportunity for the finalists to learn the best from the leaders in the Philippine franchise industry and meet potential investors.” Franchise A sia Philippines 2017, dubbed as the biggest 4-in1 franchise, show in Asia, will

escalona

LIM

be highlighted by the following activities: A two-day international conference that will present global best practices and business solutions by renowned experts; A three-day international expo that is a one-stop shop of franchise and other investment opportunities from home-grown and foreign concepts; Educational seminars to help aspiring franchisees invest on the right franchise and potential franchisors transform their businesses into successful franchises; and A two-day Certified Franchise Executive (CFE) Program to help professionalize the Philippine franchise sector and help sustain efforts in raising the global competitiveness of Philippine franchising. The said event is expected to gather around 1,000 conference delegates and over 45,000 expo visitor. One of the NxtGen finalists, according to Lim, will also be given a chance to represent the country to the NextGen in Franchising Global Competition, which will be held in the US in 2018. “We are proud to note that, since joining the NextGen Global Competition, Philippines has always been part of the roster of winners,” Lim said.

Philippine NxtGen in Franchising 2016 finalist Happy Helpers, a social enterprise providing home cleaning services and working in partnership with Gawad Kalinga, is selected as one of last year's winners in the global competition held during the International Franchise Association’s Annual Convention in Las Vegas. Meanwhile, Philippine agriculture conglomerate Calata Corp. and stationery and gift item retailer The Paper Stone Philippines were both selected as winners in the 2015 competition. “Being selected as one of the best among over 400 entrepreneurs competing from all over the world shows that we are home to world-class entrepreneurs,” Escalona said. “Thus, we encourage young innovators and risk takers, if you have a concept that can be the next franchise success story, to join NxtGen in Franchising 2017.” Interested applicants are required to submit an application form which may be downloaded at www.pfa.org.ph/NxtGen2017, an executive summary of your business and how franchising can help it grow, and an advertisement or a presentation that will aid in selling your business concept. The submission of entries for NxtGen in Franchising Award is open until May 31.

The Regions BusinessMirror

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Editor: Efleda P. Campos • Monday, May 29, 2017 A5

Senators review ML report in Mindanao

By Butch Fernandez

@butchfBM

EN. Panfilo M. Lacson Sr. warned over the weekend against potential abuse of martial-law (ML) powers, including taking over private establishments, as the Senate is set to tackle a Malacañan Palace report on the basis of imposing martial law in Mindanao.

Lacson aired the warning after Armed Forces Chief Gen. Eduardo Año, designated martial-law implementer, confirmed government options to take over private establish-

ments, including utilities. Lacson voiced concerns in a radio interview over Año’s statement that authorities can take over private establishments if necessary to end

the state of rebellion and foreign invasion that prompted President Duterte to issue Proclamation 216, placing the entire Mindanao area under martial rule. Año was designated by Duterte on May 25 as martial-law implementer and was given six more months of duty, as he was due for mandatory retirement in October. Lacson recalled in a radio interview that Año himself admitted the takeover of some private utilities, which, Lacson said, is not covered by the Palace Proclamation. “Sabi ni Año, magte-takeover sila ng private facilities, eh hindi kasama iyan sa Proclamation 216.” The Senator suggested Congress can step in to check the potential abuse of martial-law powers in Mindanao. “If we see excesses like indis-

criminate arrests, Congress can move if they don’t file cases right away [against arrested suspects],” he said. “ In case of takeover of private firms, Congress can revoke the order.” But Lacson hastened to clarify there is yet no cause for concern. “Right now, there is no reason yet. But citizens can go to court as they did during the Arroyo administration,” Lacson said, recalling the time when then-President Gloria Macapagal-Arroyo declared a state of national emergency in February 2006. He said even under such a situation, affected citizens are not without recourse and can go after erring martial-law implementers. “If there are abuses, those guilty are not immune; they are not protected because Duterte is not the one

who will be liable,” Lacson said, even as Duterte had said “Sagot ko kayo”, implying he will take responsibility for those accused in the course of carrying out his martial-law orders. Lacson confirmed Senate President Aquilino Pimentel III was set to convene a majority caucus last Sunday night in advance of an allsenators’ meeting on Monday to discuss details of the Palace report on the martial-law imposition in Mindanao. He indicated lawmakers need to decide when the government can take over facilities and private utilities. “Iyon ang dapat bantayan...mga abuses,” Lacson said, adding the senators are also expected to discuss in Sunday’s caucus the need for holding a joint session of Congress, which is required only to revoke or extend the martial-law proclamation.

Lacson said besides the takeover of private establishments, another potential area for abuse is the application of warrantless arrests. He added warrantless arrest can be resorted to by the martial-law, implementers for offenses covered by the basis for declaring martiallaw because the ongoing rebellion or foreign invasion is considered a continuing crime. But other offenses unrelated to the grounds that prompted martial-law declaration must still go through the usual judicial process as mandated by the Constitution unless the alleged crimes fall under the usual definition of continuing crime. Even without martial law, Lacson said warrantless arrest is allowed, but strictly under the definition of “continuing crime”.

Agriculture/Commodities BusinessMirror

Monday, May 29, 2017 • Editor: Jennifer A. Ng

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Solon calls for probe into PHL rice stocks By Jovee Marie N. Dela Cruz @joveemarie

mid government plans to soon import rice to beef up the country’s stocks, a vice chairman of the House Committee on Appropriation has formally called for a congressional inquiry into the “true state” of the national rice inventory. In House Resolution 993, Nacionalista Party Rep. Luis Raymund F. Villafuerte of Camarines Sur wants the appropriate committee of the House of Representatives to “conduct an inquiry in aid of legislation on the true state of rice inventory in the Philippines to ensure adequate and affordable rice supply during the

traditional lean months”. In a statement, Villafuerte said the inquiry could immediately determine “the true state of the country’s rice inventory that is crucial to the timely drawing of proposals for the government to ensure ample and affordable rice supply” for the remainder of the year and onward.

He also said Congress could back immediate imports— only if determined necessary in the course of the would-be public hearings—“to enable the government to proactively maintain the ideal buffer stock level, equivalent to a 30-day supply of the national daily rice requirement, by the time domestic stocks dwindle during the traditional July to September lean months.” Villafuerte filed this resolution a day before Cabinet Secretary Leoncio B. Evasco Jr. announced on May 16 the recommendation by the National Food Authority Council (NFAC), which Evasco chairs, for the NFA to import rice. The NFAC allowed the importation via the government-to-private scheme. Evasco has said the NFAC ordered the NFA to allow the entry of the remaining volume of 54,000 metric tons (MT) under the countr y’s 2016 minimum access volume (MAV) commit-

ment to the World Trade Organization that are already in domestic ports. Rice imported via MAV are slapped a lower tariff of 35 percent. “An adequate rice supply is necessary for our food security, especially during times of calamities and emergencies,” added Villafuerte, who is also the vice chairman of the House Committee on Local Government. He said the inquiry to be conducted by the House of Representatives could help Malacañang come up with policy proposals to ensure ample and affordable rice supply throughout the year. Citing the latest data from the Philippine Statistics Authority, Villafuerte noted that rice output will go up by 11 percent to 4.13 million MT (MMT) in the second quarter. This will cause first semester production to reach 8.55 MMT, 11.78 percent higher than the 7.65 MMT produced in the same period last year.

Govt eyeing to cut tariff of garlic imports–official

IRRI launches app to help farmers deal with rice pests, diseases

he International Rice Research Institute (IRRI) said it has rolled out a Filipino version of an offline smart phone app that enables farmers to identify and manage crop problems in palay production. IRRI knowledge management and outreach specialist Poornima Shankar said the app, dubbed “Rice Doctor”, is an interactive questionnaire that helps extension workers, farmers, researchers and students in the diagnosis of pests, disease and other problems affecting rice. The current version of the app can help diagnose any of more than 80 of the most common conditions affecting rice, Shankar added. “A lthough Filipinos remain among the most English-proficient in Asia, for many farmers as well as the agricultural extension workers assisting them, a mobile app such as Rice Doctor being available in Filipino presents an easier-to-understand and, thus, a more straightforward knowledge resource,” the IRRI said in a statement. “Rice Doctor in Filipino is the first localized and translated version of the diagnostic app. Similar efforts are ongoing in India and Bangladesh,” the IRRI added. The IRRI said it conducted series of workshops and consultations with farmers, extension workers and specialists from the Philippine Rice Research Institute (PhilRice) to increase awareness on the localization of the Rice Doctor app.

“The development of Rice Doctor in Filipino was supported fully under the project Improving Technology Promotion and Delivery through Capability Enhancement of Next-GenRice Extension Professionals and Other Intermediaries (IPaD), a collaboration among IRRI, Department of Agriculture (DA)PhilRice and (DA)-Agricultural Training Institute,” the IRRI said. “Last year Project IPaD and the Impact Acceleration Unit also did a study in different parts of the country to assess and improve the usability of Rice Doctor,” it added. Earlier, the DA launched its very own smartphone application called “Farmhelp”, a 24/7 online assistance desk that would attend to farmers’ needs and complaints, such as those related to managing plant and animal diseases. Farmhelp also provides other pertinent information to farmers, such as price monitoring of commodities in the market and weather forecasts. The DA is set to conduct a nationwide information campaign by November to instruct farmers on how to use Farmhelp. The DA also vowed to provide each farmers’ association and cooperative with a “low-cost” smartphone, to help them access Farmhelp. Agriculture Secretary Emmanuel F. Piñol said apps like Farmhelp would help “revolutionize” the agriculture sector through the utilization of available technologies. Jasper Emmanuel Y. Arcalas

‘More expensive in the Philippines’

G File photo

By Jasper Emmanuel Y. Arcalas @jearcalas

he government is mulling over to reduce the tariff on garlic imports to boost local supply and cut its retail price, according to a senior official of the Department of Agriculture (DA). Agriculture Undersecretary for Operations Ariel T. Cayanan said private traders are having difficulties buying garlic from abroad because of limited supply. “Maybe we could reduce the tariff on garlic so it would be more profitable for traders to bring it in,” Cayanan told reporters in an interview. “Traders are saying they are losing money because the cost of garlic is high. Supply is limited be-

cause it is currently the lean season for garlic in China,” he added. Cayanan, however, could not say by how much the tariff on garlic imports would be cut. “We still have to consult the policy and planning office to determine if it’s possible to reduce tariffs on garlic imports. We’re also going to meet with concerned agencies to determine how we will address the situation,” he added. Garlic exports to the Philippines are slapped a 3-percent tariff and subjected to 12-percent valueadded tax, data from the Tariff Commission showed. The Bureau of Plant Industry (BPI), an attached agency of the DA, approved 1,143 sanitary phytosanitary-import clearances covering the importation of 57,150

metric tons (MT) of garlic from January to May. However, as of May 25, only 12,440.34 MT have been brought in by private garlic importers to the country, BPI data showed. “Based on our study and data, India and China are the main sources of imported garlic for the Philippines. But it is currently the lean season for garlic in the two countries,” Cayanan said. Of the 12,440.37 MT imported from January to May this year, 12,206.86 MT were bought from China, according to the BPI data. The remaining volume was purchased from India. Cayanan said the price of garlic in the local market is expected to stabilize by July, when China’s garlic harvest is expected to peak.

He added that more than 90 percent of the country’s onion supply is being sourced abroad, with the remaining volume being provided by local production. “Even if local production increases, it may not be sufficient given the 1.9 percent annual increase in our population,” he said. The country’s garlic production in the first quarter of 2017 grew by 3.1 percent to 7,030 MT, from 6,820 MT recorded a year ago, according to data from the Philippine Statistics Authority (PSA). Latest data from the PSA also showed that, as of third week of May, native garlic retailed at P250 per kilogram, while imported garlic was at P200 per kg. The prices were higher by P50 compared to the April level.

FAO warns of lethal virus spreading among tilapia fish

OME—A highly contagious disease is spreading among farmed and wild tilapia, one of the world’s most important fish for human consumption, the UN Food and Agriculture Organization (FAO) said last Friday. The Rome-based UN agency said the outbreak should be treated with concern, and countries importing tilapias should take appropriate risk-management measures, including intensifying diagnostics testing, enforcing health certificates, deploying quarantine measures

and developing contingency plans. According to a Special Alert released by FAO’s Global Information and Early Warnings System (GIEWS), Tilapia Lake Virus (TiLV) has now been confirmed in five countries on three continents: Colombia, Ecuador, Egypt, Israel and Thailand. While the pathogen poses no public health concern, it can decimate infected tilapia population. In 2015 world tilapia production, from both aquaculture and capture, amounted to 6.4 million tons, with an estimated value of $9.8 billion,

and worldwide trade was valued at $1.8 billion. The fish is a mainstay of global food security and nutrition, GIEWS said. The FAO also said tilapia-producing countries need to be vigilant and should follow aquatic animal-health code protocols of the World Organization for Animal Health (OIE) when trading tilapia. They should initiate an active surveillance program to determine the presence or absence of TiLV, the geographic extent of the infection and identify risk factors that may help contain it. PNA/Xinhua

ideon Lasco wrote a column under this title in the Philippine Daily Inquirer the other day. He talked about the high prices of medicines, telecommunication and energy. While I am tempted to provide more insights on the cost of medicines at the retail level—and some of the reasons behind it—let me look at one sector Lasco did not mention: agriculture-food. The failure to develop the agrifood sector is one of the main causes of poverty in this country, other than in Indonesia, Malaysia, Thailand and Vietnam where farm productivity is high and rural poverty is low. And the culprits for the failure in the Philippines are well known: n Low investment n Bad weather n Weak property rights n Poor access to credit n Inadequate infrastructure n Inadequate agricultural support services. Sure, we are always blaming bad weather, but that happens in other countries too, and crop insurance in order to reduce the risks for farmers is still the exception rather than the rule. Ernie Ordoñez said in a recent article that we have the needed technologies to improve productivity but, he added, these technologies are with our universities and research institutes and not with the farmers. Maybe, Ernie, we should copy the model of “shopfloor R+D”, which we developed for Cebu’s industries in cooperation with the Department of Science and Technology and the universities, and bring it to the farm level. The idea is simple: bring professors and senior students to the shop-floor/farm and transfer/enhance technology where it is needed. Extension workers can be added to the team. A win-win situation for all stakeholders. Unfortunately, high productivity is—in most cases—cost-driven,

Henry J. Schumacher

europe Beat Rolando Dy said. Good seeds cost more recommended fertilizers require larger quantities and mechanized farming requires scale. Therefore, more efforts have to be undertaken to organize farmers to consolidate land holdings or create cooperatives. Also, postharvest losses, which are running very often to up to 50 percent, need to be addressed, from harvest mechanization, to drying to storage and farm-to-market roads, including cool storage and transport for fruits and vegetables. Part of addressing farm productivity and bringing down the costs for the consumers is the promotion of market-oriented diversification in farming, like: n planting legumes and vegetables after rice and corn; n planting coffee, cacao and fruit trees between coconut trees; n raising livestock on idle hilly areas and slopes; n raising fish by fully utilizing the flow of irrigation water; and n creating a supply- and valuechain cooperation between farmers and food-processing industries. Let me conclude by quoting Lasco again: “Moving forward, I think we need to first realize that this [the high cost in the Philippines] is not normal; we need to get to the bottom of why this is so— and hold to account the people who have benefited from the status quo. The ensuring loss of competitiveness, and more important, the toll on ordinary Filipinos, is a price we shouldn’t have to pay.”

AseanMonday BusinessMirror

Monday, May 29, 2017 • Editor: Max V. de Leon

Australia’s notorious drug smuggler returns from Bali

Australian Schapelle Corby is escorted by Indonesian police officers to get on a car as she leaves the parole office in Bali, Indonesia, on May 27. Indonesia last Saturday deported Corby, whose trial and imprisonment on the tourist island of Bali mesmerized her homeland for more than a decade. AP

YDNEY—Australian drug smuggler Schapelle Corby, whose trial and imprisonment on Indonesia’s tourist island of Bali mesmerized her country for more than a decade, returned home last Sunday.

Corby landed in the Queensland capital of Brisbane early Sunday morning, after she was deported from Bali amid a frenzy of journalists. More than 200 police officers were de-

ployed to secure her departure from Denpasar, Bali’s capital, said Ida Bagus Adnyana, who heads Bali’s Justice and Human Rights office. “Corby signed a document to end

her parole. She is completely free now,” he said. Back on Australian soil, she managed to evade the waiting media throng and slip out of the airport unseen. A member of Corby’s security team, Eleanor Whitman, read a statement to journalists on behalf of the family. “To all those in Australia and all those in Bali who have been there throughout this difficult journey, your support has not gone unnoticed,” the statement said. “The priority of our focus will now be on healing and moving forward.” Corby was arrested in 2004 at the age of 27 after customs officers at Bali’s

airport found more than 4 kilograms (£9) of marijuana inside her boogie board bag, sparking a media frenzy in Australia on a par with America’s O.J. Simpson trial. Corby always insisted the drugs had been planted in her bag, and most Australians initially believed her story. Her courtroom battle was tailor-made for TV: a photogenic Australian beach girl who had apparently fallen victim to corrupt officials in an Asian country that had come to be viewed with fear and suspicion after dozens of Australians were killed in the 2002 Bali bombings. Indonesians, who called Corby “Ganja Queen”, were mystified by Australia’s response. To them, the case was clearcut, and the Australian outrage overly nationalistic. Corby’s insistence that the drugs were planted by baggage handlers was dismissed as lies by Balinese prosecutors. A court sentenced her to 20 years in prison, though that was later reduced. In 2014, after nine years behind bars, she was released but had to stay in Bali until her parole expired last Saturday. In the lead-up to her deportation, she kept a low profile, living in a villa in Bali with her Indonesian boyfriend. Australian media spent two weeks camped outside the villa, attempting to catch a glimpse of the elusive drug smuggler. Hoping to fool reporters, friends and family members took to donning bizarre face masks as they went to and from the property. Though proving Corby’s innocence was once something of a national cause in Australia, unflattering reports about her family emerged over the years, sullying her image in many Australians’ eyes. Today, few Australians still believe Corby’s story but remain fascinated by the saga. Under Australian law, she will not be able to directly profit from telling her story. AP

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Buddhist group gathers in Myanmar despite ban

ANGON, Myanmar—Thousands of Buddhist monks, nuns and supporters of an ultranationalist Buddhist group gathered at an annual conference on the outskirts of Myanmar’s biggest city last Saturday, despite being banned by the government. The State Sangha Maha Nayaka, the country’s highest Buddhist institution, officially banned Ma Ba Tha for motivating riots largely targeting Myanmar’s Muslim minority. The group was ordered to stop its activities and to take down its signboards nationwide by July 15. “According to their terms, our group is called an unlawful association, but we want you to know that our group will not be abolished,” a senior monk from the group told the audience at the conference. Ma Ba Tha and its high-profile leading monk, Wirathu, have been accused of summoning anti-Islamic preaching and stirring up mob violence in Buddhist-majority Myanmar, causing deaths of Muslims and destruction of their property. Most of the victims are from the Rohingya Muslim minority in Rakhine state. “We just wanted to save our people, but maybe many people just want to die like dogs and pigs in the hands of the enemy,” the monk said. The government’s ban came after Buddhist hard-liners forced local authorities to shut down two Muslim schools in April and later confronted Muslim neighborhoods claiming to search for illegal Rohingya hiding in the area. It was the latest manifestation of years of rising anti-Muslim sentiment in Myanmar. “Even if we are banned, that doesn’t mean we will disappear,” the monk said last Saturday. “We will continue to do what we can to protect our race and religion.” AP

DND chief: Russia eyes ‘more engagements’ with Asean

USSIA wants more engagements with member-states of the Asean, Defense Secretary Delfin N. Lorenzana has said. “I think they would like to have an engagement with Asean and, since we are the chairman now, maybe they would like to have a foothold maybe to deal with the other members of the Asean,” Lorenzana said, when asked about the warming of security and defense ties between the Philippines and Russia, during an interview on PNA Exclusive in Moscow, Russia. “In fact, they are already dealing with other members of Asean, like Vietnam, because they had a close relationship before,” Lorenzana said. “In fact, Vietnam has bought from them some military equipment.” Lorenzana was part of President Duterte’s four-day visit to Russia, a trip that was cut short by the fighting between Maute Group terrorists and military units in Marawi City, Lanao del Sur. Earlier, the two nations signed an Agreement on Defense Cooperation that will pave the way for more exchanges between their defense establishments. PNA

Nearly 57,000 Myanmar, having warmed to the West, turns to China again observers at W Cambodia’s June 4 polls

HNOM PENH—About 56,817 national and 94 foreign observers will monitor the fourth mandate commune elections in Cambodia on June 4, the National Election Committee (NEC) said last Saturday. The national obser vers come from 14 associations and non-governmental organizations, as the international observers come from the European Union and embassies of 13 countries to Cambodia, as well as the USbacked National Democratic Institute (NDI), the NEC said in a press release. Twelve political parties will compete in the upcoming elections, with the ruling Cambodian People’s Party (CPP) and the opposition Cambodia National Rescue Party (CNRP) being the major contestants in the elections, according to the NEC. Held once every five years, the commune elections are to choose commune chiefs and councilors for the kingdom’s 1,646 communes, the NEC said, adding that around 7.87 million eligible voters are expected to cast their ballots. In the last commune elections in June 2012, the ruling CPP gained 61.9 percent of the votes, compared to about 30.6 percent for the opposition. Xinhua/PNA

ASHINGTON—Myanmar was supposed to turn away from China and toward the West when the United States helped the Southeast Asian country make the transition to a civilian government after five decades of military rule. The opposite is happening: The new government is failing to attract Western investment and Beijing is on a charm offensive. China is offering economic and political support and a relationship free of the human-rights concerns straining Myanmar’s ties elsewhere. Myanmar, also known as Burma, was a foreign-policy success for President Barack Obama. He helped coax its powerful generals into ceding power by normalizing diplomatic relations and rolling back years of economic penalties, paving the way for Nobel Peace laureate, Aung San Suu Kyi, to take power after winning elections. Suu Kyi’s historic struggle for democracy still evokes deep respect in Washington and Europe, but running a civilian government for the past 14 months has exposed her inability to bring peace to a country riven by ethnic conflict. She also has struggled to produce economic growth, hobbled by a lack of control over the nation’s still-powerful military and a rigid management style. Finding less love among the Western democracies, Suu Kyi is cautiously embracing closer ties to China. “Amid the unpredictable challenges of this democratic transition, Western influence on Burma is waning, while Beijing is becoming more assertive,” Myanmar’s Irrawaddy news web site said in an editorial.

Policy focus

RECENT weeks have seen a flurry of China-Myanmar engagement. Suu Kyi met Chinese leader Xi Jinping at a Beijing summit in mid-May, her

second visit there in the past year. Earlier, Myanmar’s titular president, Htin Kyaw, received a six-day state visit. Suu Kyi’s trip ended with an agreement with China to create an economic cooperation zone as part of the Asian giant’s “Belt and Road” initiative to connect with Asian and European markets. Last weekend Myanmar’s Navy held drills with Chinese warships. China’s state-run Global Times said the military cooperation demonstrated “political trust”. That trust was expected to develop between Suu Kyi and the US-led West. Myanmar’s enduring fear of being dominated by its much larger neighbor, China, was one reason it improved ties with the US in the first place. The Obama administration seized the opportunity while trying to “pivot” American foreign-policy focus to Asia, hoping deeper relationships with its booming economies would provide the US long-term strategic and economic advantages. Derek Mitchell, the former US ambassador who spearheaded Obama’s Myanmar rapprochement, said China was “stunned” when the country reached out to the West between 2011 and 2015. China is now making up for lost time, and capitalizing on President Donald J. Trump’s reduced attention for Myanmar, he said. “It gave an opportunity for China to say, ‘See, we’re on your border and we’re here to stay. You can’t count on the Americans’,” Mitchell said.

Cooked duck

KATINA Adams, a State Department spokesman for East Asia, said the US remains committed to consolidating democracy in Myanmar and is helping the government address many inherited challenges, including the disproportionate role of the military in the economy and the need for

In this May 16 file-pool photo, Myanmar State Counselor Aung San Suu Kyi meets with Chinese Premier Li Keqiang at the Great Hall of the People in Beijing. AP

responsible investment. Trump has started to reach out to Southeast Asian leaders, praising Philippine President Duterte for his deadly war on drugs and inviting him and Thailand’s prime minister, who took power in a coup, to the White House. In the coming week, Trump is hosting communist Vietnam’s prime minister. Trump has yet to speak with Suu Kyi. For two decades, while Myanmar was under military rule, US administrations and influential lawmakers adored Suu Kyi. Obama helped her transformation from political prisoner to national leader, fostering democracy on China’s doorstep. Republicans and Democrats promoted the change as a victory for US interests and values.

China, which sees Myanmar as a land bridge to the Indian Ocean, saw a strategic setback. Yun Sun, a China expert at the Stimson Center in Washington, said Chinese policy experts even characterized it with a proverb: “The cooked duck flew out of the window.” She said the proverb’s meaning is clear: “Myanmar was already in our pockets but somehow the Americans stole it from us.” But Trump may have little political incentive now to prioritize US ties with Myanmar. “What are left now are the problems,” Sun added.

Some problems

Sluggish economic growth. Washington has increased foreign aid and encouraged American investors

last September by lifting the remaining economic sanctions other than on arms sales. But the moves haven’t spurred economic activity in one of Asia’s last untapped markets. Myanmar ranks 170th out of 190 nations in the World Bank’s ease-ofdoing-business rankings, and thirdworst globally for contract enforcement. Foreign investment dropped almost a third between April 2016 and April 2017, according to Myanmar government figures, with no new US projects. n Human rights. Western nations in March backed a UN factfinding mission on reported atrocities against Myanmar’s downtrodden Rohingya Muslims. Suu Kyi opposed the idea, tarnishing her international reputation. n Ethnic conflict. Suu Kyi has prioritized resolving Myanmar’s decades-long wars between the army and ethnic rebels, with little success. She tried again this week, bringing rebel groups together for talks with the government and military. China has leverage with rebels near its border and says it supports peace. Resolution, however, hinges on Myanmar’s willingness to cede power to minorities and facilitate greater federalism. On economic development, China faces wary Burmese citizens. Chinese projects have uprooted villagers and hurt the environment, factors that led Myanmar in 2011 to suspend a $3.6 billion dam primarily funded by Chinese energy interests. The suspension remains a sore point. Mitchell, the former Obama envoy, warned of a larger strategic setback for the US. Failing to consolidate Myanmar’s transition would tell the region’s autocratic governments they were right, he said, that “democracy doesn’t work in Asia”. AP

The World BusinessMirror

news@businessmirror.com.ph

Editor: Lyn Resurreccion • Monday, May 29, 2017 A9

Trump’s ‘home run’ trip leaves his WH aides delighted, Europe agape

he world just got its first closeup look at Donald J. Trump. It didn’t always like what it saw.

There he was pushing aside Montenegro’s prime minister to be frontand-center for a North Atlantic Treaty Organization (Nato) photo-op. Here he was beaming giddily next to a stern-faced pope. On the same day, his wife Melania swatted away his attempt to hold hands. In Saudi Arabia, one senior White House official marveled at the lack of protesters, perhaps not realizing Saudi bans them. In Israel, after an historic direct flight from Riyadh, Trump raised eyebrows with the comment, “we just got back from the Middle East”. In Brussels, Trump walked into the gleaming new Nato headquarters—and, with a real-estate mogul’s eye, made clear he wondered if they’d overpaid. “Love your shoes. Boy, those shoes. Man!” Trump said to Egyptian President Abdel Fattah el-Sisi when they met in Saudi Arabia on Sunday, a friendly nod to a Mideast strongman who the US largely snubbed during the Obama administration. El-Sisi visited the White House within three months of Trump taking office. By the time he got to Sicily, Trump probably wished he were back at the glittering sword-dance ceremony in the Middle East, where various parties—Israelis, Palestinians, Saudis—need the US for trade, peace and protection.

Nato skeptic

Europe, on the other hand, is prepared to go on without him. After the presidential election, the Continent’s leaders always figured they’d be going it alone without the Brexit-loving, free trade-bashing, Nato skeptic. Nothing that happened on this trip should fundamentally change that view. The trans-Atlantic alliance stands, but with people on both sides in a state of sober, not heartfelt, embrace. Trump himself called the trip a “home run”, and aides agreed, delighted over the lack of major gaffes and their ability to keep Trump largely on script and far away from reporters. Even Trump’s Twitter account was

American’s knuckles turned white, and spoke only French when the two chatted before the cameras (Macron switched to English for his remarks with May). Merkel, Europe’s most influential leader, was the least amused by Trump. She said, in effect, that Nato would join the anti-Islamic State coalition as Trump requested, but it won’t mean committing a single extra soldier. Merkel also brushed off Trump’s call for a quicker increase in defense spending. Then there were the small dramas within the drama. One of the few times Trump took a reporter’s question, it didn’t help. Trump offered a defense of his conduct in a meeting where he shared secret intelligence with Russian diplomats—and seemed to out Israel as the source of the information, something that had been reported only through inference until then. “So you had another story wrong. Never mentioned the word ‘Israel”, Trump said.

$51,000

The cost of the Dolce and Gabbana jacket first lady Melania Trump wore last Friday

uncharacteristically free of top-ofmind rants—despite the storm that awaits his return the US, with sonin-law Jared Kushner getting pulled deeper into the Federal Bureau of Investigation’s (FBI) Russia probe. As for some of the rough edges, White House officials shrugged, that was just Trump being Trump. It’s not as though stepping past the Montenegrin would exactly hurt his image with his political base, particularly after a Republican House candidate in Montana was charged with allegedly bodyslamming a reporter and winning an election the next day (Even Montenegro’s Dusko Markovic said the American president deserved to be in the front row).

Merkel’s disdain

IF Europeans thought a more diplomatic president would show up in this most diplomatic of settings, they obviously hadn’t paid attention to Trump’s first months in office, when American voters found out that at age 70, he is who he is. That doesn’t mean they weren’t annoyed. German Chancellor Angela Merkel could barely contain her disdain for the American outlier on the Paris climate agreement. “The whole discussion about climate has been difficult, or rather, very unsatisfactory,” Merkel told reporters after the summit. “Here we have the situation that six members, or even seven if you want to add the EU, stand against one.” The one, of course, being Trump. He seemed unbothered and unrushed, though, tweeting that he’d make a decision on Paris stay-orgo next week. Trump seemed to be groping toward a way to stay in the accord, perhaps by making country goals nonbinding as a way to lessen

Vatican visit

U.S. President Donald J. Trump and French President Emmanuel Macron in a playful mood at the photo session during the Group-of-Seven meeting in Taormina, Italy. Bloomberg

the impact he sees the climate deal having on the US economy.

‘We will win’

In Trump’s telling of the trip, recounted on Saturday to a friendly crowd of US troops in Sicily, he made strong, new friends around the world and united global leaders against terrorism with a new sense of resolve following the May 22 bombing attack in Manchester. “We will win,” he declared. Trump also took what in his mind were important steps toward Middle East peace—by getting Israel and the Saudis to unite behind their shared enmity toward Iran, even if his gestures were lacking details in a region where the details are all that matters. In Europe, he talked tough on Nato and trade, but won no converts to his side. Some were more disappointed by what Trump didn’t say than what he did. In Israel he didn’t mention the

two-state solution that would create a Palestinian nation, or moving the US embassy to Jerusalem from Tel Aviv, remaining silent on a longstanding campaign pledge. Trump reportedly worked on his big speech to Nato for several days, then didn’t say the words “Article 5”, thereby refusing to put to rest fears his administration might not stand by the mutual defense pledge.

Epic handshake

Meanwhile, the European leaders, even ones who have already visited the White House, were clearly sizing him up. British Prime Minster Theresa May lectured Trump on intelligence leaks about Manchester—although the “special relationship” warmed once more when May faulted the FBI, Trump’s own tormentor on Russia. Recently elected French President Emmanuel Macron squeezed Trump’s hand so hard that the

IN one of the trip’s more moving moments, Melania Trump related having read a book to a sick child at a hospital in Rome who needed a heart transplant—and the boy found out hours later that a new organ had come through for him. She and Trump even held hands on their way out of Italy, as they boarded Air Force One. Still, it didn’t help the first lady’s image when reports circulated that the Dolce and Gabbana jacket she wore last Friday cost $51,000, not much less than the US median household income. Another stumble came as White House press secretary Sean Spicer, a practicing Catholic, was noticeably absent from the entourage Trump assembled to visit the Vatican. Although staff cast it as a planning mix-up, it was interpreted by some White House watchers as a slight against Spicer, who has for months been beating off rumors that he’s on the edge of being fired. All the while, the news from home was never far behind. In the closing days of the trip, it was revealed that Kushner had considered setting up a secret backchannel to Russia. Last Friday in Sicily, one didn’t need to know Italian to understand the context of Italian TV news stories that repeated “Jared Kushner” and “FBI” over and over. Bloomberg News

Trump faces growing crisis on Russia ties amid reports over Kushner

resident Donald J. Trump returned home last Saturday to confront a growing political and legal threat, as his top aides tried to contain the fallout from reports that his son-in-law, Jared Kushner, is a focus of investigations into possible collusion between Russia and the president’s campaign and transition teams. As Trump ended a nine-day overseas trip that aides considered the most successful stretch of his presidency, he was returning to a crisis that had only grown in his absence. The White House canceled a presidential trip to Iowa in the coming days and was putting together a damage-control plan to expand the president’s legal team, reorganize his communications staff and wall off a scandal that has jeopardized his agenda and now threatens to engulf his family. Trump’s private legal team, led by his New York lawyer, Marc Kasowitz, was preparing to meet in Washington to face new questions about contacts between Kushner and representatives of President Vladimir Putin of Russia. Trump may meet with Kasowitz as early as Sunday, and aides have recruited a series of prominent Washington lawyers with experience in political investigations for Trump to interview in hopes that they might join the legal team. Kushner, who organized the president’s MiddleEast stops at the start of the foreign trip, chose to return to Washington with several days yet to go and has been unusually subdued since then. But he has no plans to step down from his role as se-

nior adviser or to reduce his duties, according to people close to him. Still, there are signs that Kushner is tiring of the nonstop combat and the damage to his reputation. He has told friends that he and his wife, Ivanka Trump, have made no long-term commitment to remain by Trump’s side, saying they would review every six months whether to return to private life in New York. Kushner’s troubles are only one facet of the crisis. Reince Priebus, the White House chief of staff, and Steve Bannon, the president’s chief strategist, also dropped off Trump’s trip early, in part to return to deal with the political furor over the Russia investigations and the president’s decision to fire James Comey as Federal Bureau of Investigation director. The White House was trying to figure out how to respond to reports that Kushner had spoken in December with Russia’s ambassador, Sergey Kislyak, about establishing a secret channel between his father-in-law’s transition team and Moscow to discuss the war in Syria and other issues. The Washington Post first reported on the suggestion last Friday, and three people informed about it confirmed it to The New York Times. The discussion took place at Trump Tower at a meeting that also included Michael Flynn, who served briefly as Trump’s national security adviser until being forced out when it was revealed that he had misled Vice President Mike Pence and others about a separate telephone conversation he had with Kislyak. It was unclear who first proposed the

Ivanka Trump and her husband Jared Kushner listen to US President Donald J. Trump at the Yad Vashem Holocaust Museum in Jerusalem, Israel, on May 23. Debbie Hill, Pool via AP secret communications channel, but the idea was for Flynn to speak directly with a Russian military official. The channel was never set up. As reports emerged about investigators’ focus on Kushner, he and Ivanka Trump discussed the possibility of having Donald F. McGahn, the White House counsel, issue a statement denying that McGahn had been contacted by federal officials about Kushner. McGahn, who has been increasingly uneasy in his role since Trump ignored his advice to delay Comey’s dismissal, said he was not the person to

write such a statement, suggesting that doing so would create a precedent requiring a response to each new report. Kushner’s private lawyer issued a statement instead. Ivanka Trump and Kushner have complained privately about what he views as an unfair level of scrutiny of his actions. Kushner has dismissed the attention on him as a reflection of his father-in-law’s unconventional approach to diplomacy and inexperience in government, rather than of anything nefarious he has done. People close to Kushner, who had lunch with Priebus last Friday and who projected an air of calm, were adamant that he was preparing for a long fight and not an exit from the White House. The reports about Kushner dominated an endof-trip briefing for reporters in Taormina, Italy, where Lt. Gen. H.R. McMaster, the president’s national security adviser, and Gary D. Cohn, his top economic adviser, declined to comment specifically on Kushner but sought to play down the significance of the disclosures. “We have back-channel communications with any number of countries,” McMaster said. “So, generally speaking, about back-channel communications, what that allows you to do is to communicate in a discreet manner. It doesn’t predispose you to any kind of content in that conversation.” He did not say whether he was comfortable with the idea of a private citizen, as Kushner was at the time, opening such a back channel. New York Times News Service

British Airways looks to resume flights after lost day in London

ritish Airways said it would try to operate most of its scheduled departures from London on Sunday, after a computersystem failure paralyzed its operations at the start of a three-day holiday weekend in the UK. The carrier scrapped all on Saturday departures from Heathrow and Gatwick airports, after originally halting services from late morning until 6 p.m., following what it called a “very severe disruption” worldwide. It ordered passengers to leave the terminals and urged other travelers to stay home. The airline is looking to operate the majority of its Heathrow departures on Sunday and “a near normal schedule” from Gatwick, although aircraft and crews are out of position and have to be relocated during the night, it said in a web-site posting late Saturday. “We are extremely sorry for the huge inconvenience this is causing our customers, and we understand how frustrating this must be,” British Airways CEO Alex Cruz said in a video message filmed at the carrier’s operations center near Heathrow. “We believe the root cause was a power supply issue, and we have no evidence of any cyber attack,” Cruz added. Long-haul flights into London are expected to arrive as scheduled on Sunday, British Airways said in an e-mailed statement. The breakdown, which also affected call centers, prevented passengers from rebooking or from retrieving luggage that had already been loaded onto their planes. Travelers took to Twitter from late morning in Europe to complain of flight postponements, long lines to check in and waiting for long periods on the tarmac after boarding planes. Once services were canceled, passengers from grounded planes or at gates at Heathrow endured large crowds at passport-control desks to reenter the country. British Airways staff told customers to find hotels on their own for reimbursement later by the airline. Payments will include £200 ($260) per night for lodging, £50 round trip between the airport and the hotel, and as much as £25 for refreshments, according to leaflets from the company. “I would estimate, given the timing of the bank holiday weekend, that this has affected a hundred flights and a thousand passengers already,” said John Strickland, director of aviation at analysts JLS Consulting, “Considering the reimbursements for canceled flights and the costs of lodging stranded passengers, this will have an impact on revenue, and the magnitude of the cost will depend on how long the outage lasts and how long it takes to resolve.” The disruption coincides with the start of the annual end-of-May Bank Holiday weekend in the UK, as well as the three-day Memorial Day weekend regarded as the unofficial start of summer in the US. Last September, a computernetwork failure brought down British Airways’ check-in system, causing worldwide service delays, while earlier this week, London Gatwick airport reported problems with its baggage-sorting system. Spokesmen for Heathrow and Gatwick airports, London’s largest and busiest, were unable to provide information on how many flights had been canceled. A spokesman for British Airways declined to comment on the number of services or passengers involved. Some of the affected computer systems are back up, the airline said late last Saturday. British Airways is a unit of International Consolidated Airlines Group SA. No widespread delays were reported at the company’s Spanish division, Iberia, or at its Irish brand Aer Lingus. Bloomberg News

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A10 Monday, May 29, 2017

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US withholding endorsement on climate pact

AORMINA, Italy—President Donald J. Trump declined to endorse the Paris climate accords last Saturday, ending his first foreign trip much as he began it: at odds with several of the nation’s allies and under a cloud of questions back home about his ties to Russia.

Trump refused to bend on the pact after three days of contentious private debate and intense lobbying by other leaders that began on Wednesday with an appeal by Pope Francis. The six other nations in the Group-of-Seven (G7) reaffirmed their commitment to cutting greenhouse-gas emissions in a joint statement issued last Saturday. The stalemate leaves the country’s future role in the climate accord in flux, although Trump promised to make a decision in the week ahead on whether the US will be the first of 195 signatories to pull out. Trump returned home last Saturday night to a White House in crisis after a nine-day trip to the Middle East and Europe that was bookended by new disclosures about links between his aides and Russia. The climate accord was the most vivid sign of division between the US and its allies, but it was not the only one: Trump also scolded Germany for its trade practices and lectured North Atlantic Treaty Organization (Nato) members for not adequately supporting the alliance. “There was a lot of give and take between the different countries in the room,” said Gary D. Cohn, director of the National Economic Council. But he insisted that the oth-

The number of days of US President Donald J. Trump’s trip to the Middle East and Europe er countries understood Trump’s refusal to decide now, even if they did not support that position. “The president’s only been in office for a certain period of time, and they respect that,” Cohn said. He added: “We’re all allies. We’re all trying to get to the right place and be respectful of each other.” While Trump’s decision was not a surprise, the reaction was swift and critical. “President Trump’s continued waffling on whether to stay in or withdraw from the Paris Agreement made it impossible to reach consensus at the Taormina summit on the need for ambitious climate action. But he stands in stark isolation,” said Alden Meyer,

director of strategy and policy at the Union of Concerned Scientists. The leaders of Germany and France expressed disappointment, according to The Associated Press. “The whole discussion about climate was very difficult, not to say unsatisfactory,” Chancellor Angela Merkel of Germany said. “There’s a situation where it’s six—if you count the European Union, seven— against one.” President Emmanuel Macron of France said he had told Trump it was “indispensable for the reputation of the United States and for the Americans themselves that the Americans remain committed” to the climate agreement. The G7 statement provides the US more time to resolve internal White House debates about whether to pull out of the pact. It says the US is “in the process of reviewing its policies on climate change and on the Paris Agreement and, thus, is not in a position to join the consensus on these topics”. The president did not mention the impasse in his only public remarks after the summit to US troops at Naval Air Station Sigonella in Sicily. But he repeated his complaints about trade and the financing of Nato, even as he pronounced the trip a rousing success. “We hit a home run no matter where we are,” he said. For Trump, however, the lack of a decision on the climate accord put an uncertain ending on an ambitious first presidential trip abroad that began as a respite from the surfeit of scandal at home. Beleag uered W h ite House aides—who were aboard Air Force One flying to Riyadh, Saudi Arabia, when they heard reports that Trump had called his former FBI director a “nut job”—had hoped the trip would offer a much-needed change of subject. And to some degree, it did, if only because the White House engineered the itinerary to keep Trump far away from reporters who could ask him questions.

The coal-fired Ghent Generating Station in Ghent, Kentucky, on June 2, 2014. As President Donald J. Trump ponders whether the US should stay in or leave the Paris climate agreement, many of his closest allies and advisers have been urging him to keep the country in but “renegotiate” the deal to better reflect his energy policies. Some advocates of global climate action think the pact would be stronger if the US simply left, rather than remaining in and demanding big changes. Luke Sharrett/The New York Times

They scheduled no news conferences and put the president only in highly controlled situations: a brief photo session with a foreign leader; a teleprompter speech; ceremonial gatherings with other leaders. But last Saturday, as his aides tried to promote the trip’s accomplishments, reporters bombarded them with questions about reports that Trump’s son-in-law and adviser, Jared Kushner, had talked about opening a secret back channel to Russia during the transition. “We’re not going to comment on Jared,” an exasperated Cohn said. In some ways, it was not one trip, but two, each with very different themes. In Saudi A rabia and Israel Trump was surprisingly disciplined, sticking to his script and delivering two speeches that set

Macron erupts on world stage with Trump snub, ‘bromance’

n a sun-kissed terrace overlooking the sea, the image of Emmanuel Macron and Justin Trudeau staring into each other’s eyes had social media swooning over the budding bromance between the two young leaders at the Group-of-Seven (G7) in Sicily. But just 24 hours earlier in Brussels, Macron had crushed Donald J. Trump’s hand until his knuckles turned white and walked past the US president to embrace German Chancellor Angela Merkel on the blue North Atlantic Treaty Organization (Nato) welcome carpet. At his debut on the world stage, the new French president revealed a steeliness that belies his 39 years and relative inexperience. There was the power play with Trump when during the war of handshakes he spoke at some length in French with no translator. He then spoke English with Theresa May, offering cooperation in light of the UK terror attack, while not ceding an inch on the prime minister’s request for parallel Brexit talks. To be sure, Macron remains firmly in his honeymoon period and has a raft of challenges ahead—he leads a country divided and drew much of his support from voters looking to stop Marine Le Pen. He’s inheriting an unemployment rate roughly double that of the UK and Germany, an economy that has lagged the euro-area average for three years and will need to cobble together some kind of majority after parliamentary elections next month.

Managing Director of the International Monetary Fund Christine Lagarde (left) speaks with Canadian Prime Minister Justin Trudeau (right) and French President Emmanuel Macron as they attend a round table meeting of Group-of-Seven (G7) leaders and Outreach partners at the Hotel San Domenico during a G7 summit in Taormina, Italy, on May 27. Leaders of the G7 wrap up their meeting last Saturday with discussions focused on terrorism, climate and trade. AP/Domenico Stinellis

Nonetheless, for Macron, three days of hanging out with many of the world’s most influential players from the new Nato headquarters to the ancient hill-top town of Taormina helped set the style and tone for his five-year presidency. At a roundtable in a former monastery, six leaders argued with Trump on trade and climate change, with Macron particularly adamant that there could be no diluting of the Paris Agreement to accommodate the Americans. They left it that Trump would take, as the host Paolo Gentiloni put it, some time for “internal reflection” before making a decision. Macron appeared to form a special bond with Trudeau, with

television cameras lingering on the two Generation Xers strolling down the hill conversing in French while Trump, at 70 the oldest G7 leader, stayed behind to wait for a golf cart to give him a lift through the narrow cobbled streets.

‘Inspiring’ Justin

“Justin has been inspiring,” Macron said last Friday as the pair met for the first time since his election victory this month. “We belong to a generation of leaders that will deeply renew practices and a vision of global affairs.” For his part, 45 -year-old Trudeau said he was excited to have “someone even younger and more dynamic than me who joined

the G7 table”. TV footage captured snippets of them chatting about kids: Trudeau is a father of three while Macron spoke of the grandchildren of his wife Brigitte Macron. Trudeau’s multicolored striped socks were a contrast to Macron’s more conventional navy blue. On meeting Japan’s Shinzo Abe, Macron engaged in some masculine eye-locking, while with May he settled into a workmanlike relationship. The two had already met in London when he was still campaigning and she had yet to call a snap election. On Brexit, he and Merkel fell in lockstep: first comes the divorce, and then talks on the rest. Macron has said in the runup to assuming power that his plan was to restore the image of the French presidency, without adding that his two predecessors tarnished it. He has made clear through his team of loyal and tight-lipped aides, that he would be doing little talking to the press, who were not invited to travel with him on the presidential jet. Nicolas Sarkozy, nicknamed president Bling-Bling for his extravagant private life, was very talkative while François Hollande enjoyed gossiping with his favorite reporters. More will be revealed in coming weeks about who Macron is after he broke the rules of French politics to form his own movement as an underdog candidate. On his return home, he will host Russia’s Vladimir Putin on Monday at the Versailles Palace where the two will then tour an exhibit of Peter the Great. Bloomberg News

a clear course for his approach to the Middle East. His rapturous welcome in both countries suggested that the US could make a new start with allies who had grown restive during the Obama administration. In Europe, however, the pugnacious side of Trump reasserted itself. In addition to offering a harangue of Nato members over budgetary matters, he declined to explicitly reaffirm America’s commitment to Article 5, which requires the US to come to the defense of allies in the event of an attack. He also won derisive headlines across the Continent after muscling aside the prime minister of Montenegro during a photo shoot, an image that quickly became a metaphor for his rough dealings with Europeans.

“His advisers tried to make him understand that there are some allies that are really nervous and needed reassurance,” said Volker Perthes, the director of the German Institute for International and Security Affairs. “He managed to do it with the Saudis and the Israelis.” But in Europe, he said, “he does take us for granted.” Brian McKeon, a senior policy official in the Pentagon during the Obama administration, said: “The in-your-face thing at the Nato headquarters was pretty undiplomatic. He succeeded at busting norms, but not building goodwill.” The US national security adviser, Lt. Gen. H.R. McMaster, said Trump’s participation in the ceremony was an implicit endorsement of Article 5. “He did not make a decision not to say it,” McMaster said. New York Times News Service

HK questions Moody’s over debt downgrade M oody’s Investors Service’s dec ision to dow ng rade Hong Kong’s debt rating last week was based on “shallow” evidence, Hong Kong Financial Secretary Paul Chan wrote in a blog last Sunday. “The evidence on which the ratings company mechanically downgraded Hong Kong’s debt rating based on the very close economic relationship between Hong Kong and the mainland is shallow,” Chan wrote in a blog on the official web site of the financial secretary. Enhancing cooperation with the mainland cannot be considered negative as China is the main growth engine for the global economy, he added. Moody’s cut its rating on China’s debt for the first time since 1989 on Wednesday, a challenge to the view that the country’s leaders can rein in leverage while maintaining the pace of economic growth. Hours later, the company cut the rating on Hong Kong’s local- and foreigncurrency issuances to “Aa2” from “Aa1”, and changed the outlook to stable from negative. It was the territory’s first cut in ranking by Moody’s since the Asian financial crisis in 1998. “Credit trends in China will continue to have a significant impact on Hong Kong’s credit profile due to close and tightening economic, financial and political linkages with the mainland,” Moody’s said in its statement. Closer financial ties “risk introducing more direct contagion channels between China’s and Hong Kong’s financial markets”.

‘Sound fundamentals’

Hong Kong’s government said in a statement on its web site shortly afterward that it disagreed with the decision by Moody’s, citing Chan. The ratings company overlooked Hong Kong’s “sound economic fundamentals, robust financial regulatory regime, resilient banking sector and strong fiscal position,” the government said. Chan, who was appointed Hong Kong’s financial secretary in January, expanded on that argument with his blog post last Sunday. He said Moody’s concern for China’s economy lacked objective evidence because growth and exports this year have improved, while steel and coal oversupply have eased. In response to Moody’s “contagion channels” worry, Chan said Hong Kong’s financial system is very stable and it has policies in place to improve risk management for mainland-related loans. The rating firm’s outlook cut in March 2016 has proven to be “exaggerated” based on economic growth since then, Chan also wrote. Moody’s cut Hong Kong’s outlook to negative from stable last year because it said the city’s credit profile tracked China’s. Days earlier, it lowered China’s credit-rating outlook, highlighting the country’s surging debt burden and questioning the government’s ability to enact reforms. China’s currency and stocks rallied despite last week’s debt-rating downgrade. The onshore yuan strengthened 0.5 percent, the biggest weekly gain since July 2016. Shanghai’s benchmark gauge climbed 0.6 percent last week, the most since the week ended on April 7. Bloomberg News

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Monday, May 29, 2017 A11

Opec reels as minister UK lowers threat level to ‘critical’ is fired during meeting A

S Organization of the Petroleum Exporting Countries’ (Opec) ministers gathered in Vienna last Thursday to agree a nine-month extension of their oilsupply pact, the man credited with bringing about the landmark deal learned from a news broadcast that he had been fired. The story broke as Algerian Energy Minister Noureddine Boutarfa attended a closed session with counterparts early last Thursday afternoon. First came an unconfirmed report from an Algerian TV station, according to delegates who were present. More than an hour later, the nation’s official APS news agency confirmed it. It should have been a day of triumph for the man whose dogged diplomacy helped seal the historic alliance between producers of more than half the world’s oil, but the decision appears to have been far removed from events unfolding in Vienna. A day earlier, Algeria’s prime minister had been ousted, prompting a Cabinet reshuffle that included the appointment of Sonelgaz CEO Mustapha Guitouni as energy minister. In the job less than a year, Boutarfa was widely expected to keep his post following parliamentary elections earlier this month. “For Boutarfa, I can’t see any viable explanation,” said Nacer Djabi, a political analyst and sociology professor at the University of Algiers. “All the indications were that he hasn’t failed in his mission.” The abrupt dismissal showed “flagrant disregard” for his accomplishments, he said. The decision came amid growing concern about political stability in Algeria, where the collapse of oil prices has put a strain on the economy. The country’s 80-yearold president, Abdelaziz Bouteflika, is suffering ill health and has no clear successor. Boutarfa was caught unawares.

As the news swirled around the Opec’s Vienna headquarters, where representatives of allies, including Russia, were arriving to finalize a broader deal, the minister and his delegation kept mum. Once the official confirmation came, Boutarfa is said to have taken some of his peers aside and spoken to them personally. They in turn congratulated him for his achievement, officials said. Boutarfa declined to comment for this article. Representing one of Opec’s smallest producers and coming from a country with little international clout, Boutarfa played a key role in a deal many had thought was impossible. He rose to prominence in September when he hosted an extraordinary meeting in Algiers where Opec reached a preliminary accord to curb production. Later, Russia and 10 other non-Opec members joined the six-month pact that ultimately would take as much as 1.8 million barrels a day off the market. Boutarfa enlisted support by shuttling between capitals, from Paris to Moscow to Baghdad, trips recorded on his ministry’s Facebook page. Finally he corralled the ministers in a luxurious but isolated hotel on the outskirts of Algiers over several days until they hammered out an agreement. Boutarfa “had a big role in getting all the countries together and making the collaboration a success”, Issam Almarzooq, Kuwait’s oil minister, told Bloomberg News last Thursday. The deal marked an abrupt Uturn from a Saudi-led policy to pump at full throttle. It meant clearing what at first seemed almost insurmountable hurdles—the bitter rivalry between Saudi Arabia and Iran, and the unwillingness of Iraq, Libya and Nigeria, three producers champing at the bit to restore production they’d lost through internal conflict. Bloomberg News

The terror threat in the United Kingdom has been lowered to “severe” from “critical” after arrests were made following the attack in Manchester. Bloomberg

rime Minister Theresa May said the United Kingdom terror threat has been lowered to “severe” from “critical” following a number of arrests related to the terrorist attack in Manchester, and the police released a photo of the suspected suicide bomber in calling for the public’s help.

May led a meeting of the government’s emergency committee last Saturday, during which she received an update from the police and security services on the investigation into the suicide bombing at a pop concert last May 22 that killed 22 people. In response, the

threat level had been raised to the highest category a day later. “The public should be clear about what this means,” May said in a televised statement. “A threat level of severe means an attack is highly likely. Members of the public should remain vigilant.”

5,000 The number of troops deployed under Operation Temperer in order to guard key sites in the United Kingdom

The Manchester attack—the deadliest on British soil in more than a decade—prompted the government to raise the terror threat for the first time in 10 years. With less than two weeks before the June 8 general election, political campaigning was put on hold until Friday. Operation Temperer—the UK’s deployment of as many as 5,000 troops to guard key sites—will remain in place until the end of

the weekend, including Monday’s public holiday. Police activity in the past 24 hours was “significant”, and Manchester police have 11 people in custody, prompting intelligence analysts to change the threat level to indicate an attack now is highly likely, rather than imminent, May said. The police have gathered “significant information” in the past five days about the suspected suicide bomber, 22-year-old Salman Abedi, and 14 locations are still being searched in connection with the attack, Greater Manchester Police Chief Constable Ian Hopkins said in an e-mailed statement. The police released a closed-circuit TV photo of Abedi on his way to Manchester Arena, where pop star Ariana Grande was performing. Hopkins called on members of the public to help reconstruct Abedi’s final movements, asking anyone with information about his whereabouts from May 18 through to the night of May 22 to get in touch. May said her government would set up a commission to combat nonviolent extremism and promote “pluralistic” British values and women’s rights, as the fight against terrorism becomes a focus of the election campaign. The proposed Commission for Countering Extremism, introduced in the Conservative manifesto earlier this month, would have legal status and advise the government on what laws or penalties are needed, according to a statement released by her office. “Our enjoyment of Britain’s diversity must not prevent us from confronting the menace of extremism, even if that is sometimes embarrassing or difficult to do,” May said in a statement. “Enough is enough. We need to be stronger and more resolute in standing up to these people.” With less than two weeks to go before the election, and after a three-day pause following the Manchester attack, terrorism and its prevention have become the focus of the campaigns. Bloomberg News

Zbigniew Brzezinski, national security adviser to Jimmy Carter, dies at 89

bigniew Brzezinski, the hawkish strategic theorist who was national security adviser to President Jimmy Carter in the tumultuous years of the Iran hostage crisis and the Soviet invasion of Afghanistan in the late 1970s, died last Friday at a hospital in Virginia. He was 89. His death, at Inova Fairfax Hospital in Falls Church, was announced last Friday by his daughter, Mika Brzezinski, a cohost of the MSNBC program “Morning Joe”. Like his predecessor Henry A. Kissinger, Brzezinski was a foreign-born scholar (he in Poland, Kissinger in Germany) with considerable influence in global affairs, both before and long after his official tour of duty in the White House. In essays, interviews and television appearances over the decades, he cast a sharp eye on six successive administrations, including that of Donald J. Trump, whose election he did not support and whose foreign policy, he found, lacked coherence. Brzezinski was nominally a Democrat, with views that led him to speak out, for example, against the “greed”, as he put it, of a US system that compounded inequality. He was one of the few foreign policy experts to warn against the invasion of Iraq in 2003. But in at least one respect—his rigid hatred of the Soviet Union— he had stood to the right of many Republicans, including Kissinger and President Richard M. Nixon. And during his four years under Carter, beginning in 1977, thwarting Soviet expansionism at any cost guided much of US foreign policy,

for better or worse. He supported billions in military aid for Islamic militants fighting invading Soviet troops in Afghanistan. He tacitly encouraged China to continue backing the murderous regime of Pol Pot in Cambodia, lest the Soviet-backed Vietnamese take over that country. He managed to delay implementation of the Strategic Arms Limitation Talks (SALT) II arms treaty in 1979 by raising objections to Soviet behavior in Vietnam, Africa and Cuba; and when the Soviets went into Afghanistan late that year, “SALT disappeared from the US-Soviet agenda”, as he noted in a memoir four years later. Brzezinski, a descendant of Polish aristocrats (his name is pronounced Z-BIG-nyehv brehZHIHN-skee), was a severe, even intimidating, figure, with penetrating eyes and a strong Polish accent. Washington quickly learned that he had sharp elbows, as well. He was adept at seizing the spotlight and freezing out the official spokesman on foreign policy, Secretary of State Cyrus R. Vance, provoking conflicts that ultimately led to Vance’s resignation. Where Vance had endorsed the Nixon-Kissinger policy of a “triangular” power balance among the US, China and the Soviet Union, Brzezinski scorned such “acrobatics”, as he called them. He advocated instead what he called a deliberate “strategic deterioration” in relations with Moscow, and closer ties to China. By his own account, he blitzed Carter with memos until he got permission to go to Beijing in May

Former National Security Adviser Zbigniew Brzezinski (right) is greeted by former National Security Adviser Stephen Hadley, on Capitol Hill in Washington at the Senate Foreign Relations Committee hearing to examine Russia and developments in the Ukraine in July 9, 2014. Brzezinski, the national security adviser to President Jimmy Carter, has died at age 89. AP/Pablo Martinez Monsivais

1978, over State Department resistance, to begin talks that would lead to full diplomatic relations seven months later. Immediately after the trip, he appeared on “Meet the Press,” unleashing a slashing attack on the Soviet Union that Vance deplored as “loose talk”. Brzezinski was also a prime mover behind the commando mission sent to rescue the US hostages held by Ayatollah Ruhollah Khomeini’s

revolutionary forces in Iran after the overthrow of the Shah of Iran, Mohammed Reza Pahlavi—a disastrous desert expedition in April 1980 that claimed eight lives and never reached Tehran. Vance had not been informed of the mission until a few days before. It was the final straw: He quit, “stunned and angry”, he said. Brzezinski’s rationale for the rescue attempt was, perhaps in-

evitably, rooted in his preoccupation with Soviet influence. He contended that trying to gain the release of the hostages through sanctions and other diplomatic measures “would deliver Iran to the Soviets”, although many thought that outcome improbable, given the fundamentalism of the clerics running the country. Besides, he said, success would “give the United States a shot in the

arm, which it has badly needed for 20 years”, a reference to the quagmire of the Vietnam War. Soviet aggression in Asia, the Middle East, Africa and Latin America was by no means a figment of Brzezinski’s imagination. But his strict adherence to ideas in which virtually every issue circled back to the threat of Soviet domination was remarkable even for those tense times, when many in the foreign policy establishment had come to regard détente—a general easing of the geopolitical tensions between the Soviet Union and the United States—as the best course. In his scholarly cer titude, Brzezinski sometimes showed a tendency to believe that any disagreement between theory and reality indicated some fault on the part of reality. In his 1962 book, Ideology and Power in Soviet Politics, for example, he asserted that the Communist bloc “is not splitting and is not likely to split” just as Beijing and Moscow were breaking apart. With the breakup of the Soviet Union, Brzezinski allowed that it would make sense for the US to engage with Russia, although cautiously, as well as China, “to support global stability”. And although he condemned Russian meddling in elections in the US and elsewhere, he thought the effects were only marginal relative to the underlying problems shaking up Western societies. In any case, aside from his ideological principles, he had both persona l and histor ica l reasons for abhorring the Soviet system. New York Times News Service

Green Monday BusinessMirror

A12 Monday, May 29, 2017

www.businessmirror.com.ph • Editor: Lyn Resurreccion

Meaning of responsible mining

Going green, working with communities

By Jonathan L. Mayuga

@jonlmayuga

Like residents in other impact barangays, he said his constituents in Barangay Syndicate receive various programs for education, health, infrastructure and livelihood. “Ever since it started operation, I made it a point to coordinate with the Masbate Gold Project,” he said. He said the roads built and repaired through the SDMP fund allocated by the MGP were a big help to the communities. “We have four school buses providing free transportation to students,” he said. Residents of Barangay Syndicate, he said, also enjoyed health services.

an mining be done responsibly? Can mining go “green”? More important, can communities benefit from large-scale mining operations? For mining-affected communities in Aroroy, Masbate province, anything is possible. Valentin Alonzo, chairman of Barangay Syndicate and president of the Association of Barangay Captains in Aroroy, said that communities can benefit and actua lly enjoy a greener env ironment if the company adopts a policy that promotes environment-friendly programs and projects. In his barangay alone, Alonzo told the BusinessMirror in an inter view during a mine visit organized by the proponents of t he Masbate Gold Project (MGP), the single major mining investment in the Bicol region, t hat t he benef its of host ing MGP, one of the countr y’s top gold producers, is enormous, and communities enjoy the benefits of hosting the gold mine with greener coastal ecosystem.

Open-pit mining

A project of Canadian mining company B2Gold, MGP is jointly operated by Filminera Resources Corp., which holds the mining and surface rights, and by the Philippine Gold Processing and Refining Corp. (PGPRC), which owns and operates the MGP’s central processing plant. The MGP uses the open-pit mining method, abhorred by environmentalists as the most destructive mining method and, of late, was banned by then-Environment Secretary Regina Paz L. Lopez. The open-pit mining method involves massive tree cutting, blasting of mountains to crush rocks to gather and process ores to produce gold. Days before Lopez’s appointment was eventually rejected by the powerful Commission on Appointments (CA), her last order was to ban prospective open-pit mining on account of its being a perpetual financial liability for the government once abandoned; for posing a life-time threat to communities; and for ta k ing away the economic potential of the affected area.

Integrated ‘area development’

Filiminer a and PGPRC’s mine and processing plant was among the large-scale mining operations visited by the former Department of Environment and Natural Resources (DENR) chief and among the first mining operators to partner with the DENR for the implementation of the Integrated Area Development (IAD) program for Aroroy. The agreement calls for the formulation and implementation of a six-year Sustainable Integrated Area Development (SIAD) Action Plan by the government, civil society and other stakeholders affected by the mining operation. Defined as “an approach, a strateg y and a guiding philosophy that weaves environmental considerations with social justice and human development,” S IA D i s a i m e d a t a p p l y i n g area-based inter ventions and concepts on natural resources development programs.

Enhancing SDMP

Recognizing that Filminera and PGPRC are bound by law to use the Social Development Management Program (SDMP) funds in the eight barangays that were identified as part of their impact area. Through a memorandum of agreement (MOA), they are allowed to implement programs that would include all other barangays of Aroroy that are not within the impact area of the mine. The area development in Aroroy is aligned with all relevant DENR programs, like the National Greening Program, biodiversity program, Biochar Program for Agricultural and other Wastes, Coastal Research and Management, Clean Water and Air Programs and Solid Waste Management Program. The Aroroy MOA brings together the local government unit (LGU), the DENR and the proponents of the MGP into a partnership to develop and run an IAD Program, where a multi-sectorial group will be consulted to ensure the participation of all stakeholders and other LGUs.

Progressive rehabilitation

Fishermen in Aroroy enjoy the benefits of a healthy marine ecosystem.

According to Filminera Resident Manager Sulpicio Bernardo, entering into an agreement with the DENR enables MGP to be more aligned with the objectives of the DENR and enhance its SDMP to uplift the lives of community stakeholders in the area where it operates.

Mandated by law

The SDMP is a requirement of the Mining Act of 1995, which obliges mining companies to implement development programs in their host and neighboring communities. Funding for SDMP is 1.5 percent of the company’s total annual operating cost. From 2000 to 2015, the MGP have allocated close to P260 million for health, cultural and sports, livelihood, trainings and development education and infrastructure projects. Its livelihood and organization projects have created 1,600 jobs, over 80 percent of which benefitted residents of Masbate. It also provided supplemental income to 882 recipients comprised of fishermen, farmers, women and senior citizens. Filiminera and PGPRC have organized 24 associations, which are already registered with the Department of Labor and Employment. The two companies operating the MGP also conducted training programs for aquasilviculture, vegetable production, mangrove devel-

opment, food processing, massage therapy, beauty care, integrated farming and fish processing.

Environment-friendly

MGP takes pride in claiming to successfully equate responsible mining with taking care of the environment “to achieve the best possible balance between economic development and the protection of the environment”. The MGP has acquired an ISO 14001 Environmental Management System standard, an internationally recognized environmental standard which also makes the company compliant to a DENR administrative order for mining companies. The certification is a systematic framework to manage the immediate and long-term environmental impacts of an organization’s products, services and processes. Filiminera and PGPRC jointly conduct extensive environmental monitoring within their area of operation to ensure minimal impact and avoid permanent damage to the environment.

Working with communities

Bar angay Syndicate, one of the impact barangays of MGP, is one of the primar y beneficiaries of various SMDP programs and projects. “All our 2,600 plus residents benefit from what we get from [SDMP],” Alonzo said.

1,500 poor families in Laguna to gain access to clean water

anil a Water Philippine Ventures, Water. org a nd WaterL i n k s pool their resources to connect at least 1,500 low-income families to the piped water system of Laguna Water by September 2017. The joint project, dubbed as “Water Connect” that will be piloted in Laguna province, aims to support Filipino families who do not have enough means to gain access to reliable water source. T he pro j e c t , w h ic h a i m s t o pro v id e a c c e s s t o a c l e a n w a t e r s up pl y, w i l l not on l y e n s u re go o d he a lt h a nd s a fe t y, but w i l l a l s o promot e com mu n it y org a n i z i ng , a s we l l a s pro v id e t e c h n ic a l a d v ic e a nd f i n a nc i a l ser v ices to t a rgeted m a r g i n a l i z e d com mu n it ie s . Spearheading this project are three experts in the water industry, namely: Manila Water Philippine Ventures, Water.org and WaterLinks. Manila Water

manila Water, Water.org and WaterLinks launched the WaterConnect project, which aims to make safe and clean water available to all, particularly to low-income families. In the photo are (from left) Water.org Country Director Carlos Ani, WaterLinks Executive Director Mai Flor, WaterConnect Team Leader Bonifer Bautista, Laguna Water Sustainable Development Manager Eunice Christine Ricaforte and Melvin John Tan, Manila Water Philippine Ventures South Luzon regional business cluster head and Manila Water general manager.

Philippine Ventures is a wholly owned subsidiary of Ayala-led Manila Water, whose mission is to provide the water supply and used water-management requirements of area outside Metro Manila. Meanwhile, Water.org is an inter nationa l nonprofit organ i z at ion t h at h a s posit ive ly

transfor med more than 5 mill ion l ives a rou nd t he world through access to safe water and sanitation. Wate rL i n k s i s a f u l ly i n d e p e n d e nt , no n p r o f it o r g a n i z at ion t h at f ac i l it ates w ater operator pa r t nersh ips i n t he A s i a - Pa c i f ic re g ion a nd

c at a ly z es ef f ic ienc y i mprove ment s to en h a nce a nd e x pa nd access to urban water and s a n it at ion ser v ices. M ic rof i n a nce i n st it ut ion s will also be tapped to provide further assistance to families who would want to be part of this initiative.

The company implements progressive rehabilitation of forested areas. From 2013 to 2016 the MGP has planted over 1.6 million trees covering a land area of more than 2,280 hectares for its reforestation and rehabilitation programs. It also conducts reforestation activities outside its mining tenement. T he company has also established its ow n tree nurser y in Barangay Puro to ensure steady supply of planting materials for reforestation. In 2012 the company launched a massive mangrove-reforestation project in coastal barangays of Aroroy and partnered with various fisherfok organizations. MGP, through its partners, has planted 388,000 propagules in eight coastal barangays.

Way of life

Mining is a way of life in Aroroy. In fact, Aroroy used to be called Al-Oroy, which came from the Spanish word oro or gold. People in the Aroroy basically grew up with mining as the province is endowed with rich mineral deposits waiting to be tapped. Masbate and Camarines Norte in the Bicol region host around 30,000 kamote (sweet potato) miners, who are called such for their painstaking work of panning for small nuggets of gold, a very dangerous but lucrative trade, or are small-scale miners. Compared to farming or fishing, people in the barangay are used to risking their lives encroaching in areas assigned to large-scale mining companies, digging tunnels and hauling ores which they process themselves for gold. Now, a first-class municipality in Masbate province, Aroroy has played host to the MGP, a $250 -mi l lion mining venture, the biggest single-mining investment in the province,

which began operation in 2007. Its full-scale commercial production came two years later and is currently one of the country’s top gold producers. From ba ra ngay Sy nd ic ate, around 10 percent of the households are employed either by Filminera or the PGPRC.

Risky business

Unlike in farming or fishing, a kamote miner can earn as much as P700 up to P1,000 easily. Some small-scale miners prefer gold panning than working for large-scale mining companies, where they have to work for eight hours a day and wait for the pay day every two weeks, said Leonardo C. Rosal, who used to be a kamote miner himself. “Some still believe it is better because it means easy cash,” he said in Filipino. He said small-scale mining could be very dangerous, noting that some miners have died from collapsing tunnels.

Partnership with communities

Rosal, the current president of a fisherfolk organization in Aroroy, said he and 52 other members of the group are earning extra income as MGP’s partner-organization in one of its environmental-cumlivelihood projects. Since 2012 the group’s members are tasked with planting mangroves. Each is paid P20 for every propagule planted and nurtured. Rosal said fishing communities are now reaping the benef its of engag ing in massive mangrove reforestation. “During high tide, we set up our fish net around an area and harvest fish, crab, shrimps when the water subsides,” he said. Rosal said it secures them an average of 50 kilos of fish without even going out in open seas. Some of the mangroves planted by MGP’s partners, he said, have grown, enhancing the protection of coastal communities during typhoon seasons. More important, he said the mangroves they planted means more fish are able to breed and replenish their fishing grounds, ensuring bountiful harvest. For community stakeholders in Aroroy like Rosal, responsible mining means caring for the environment and making things better for communities. The proponents of the MGP take pride in partnering with a total of eight fisherfolk organizations who enjoy the benefits of greening the town’s coastal barangays.

Project to end growth of invasive mulberry tree

h e invasive growth of paper mulberry tree may soon end through the project, “Processing and wood quality evaluation of paper mulberry for furniture, handicrafts and other by-products.” Funded by the Philippine Council for Agriculture, Aquatic and Natural Resources Research and Development o f t h e D e p a r t m e nt o f S c i e n ce a n d Technology (DOST-PCAARRD), the P1.5million project aims to establish potential use of paper mulberry wood as a strategy to control, if not regulate, its spread. The project will run for 18 months. Paper mulberry can be classified as a large shrub or a small tree with a soft and brittle wood. Because of this, its timber has little or no commercial value other than for paper making, which was the reason for its introduction to the Philippines in 1935. However, it has spread since then in the archipelago. The tropical climate of the Philippines m a ke s i t ex t re m e l y s u s ce p t i b l e to invasion of paper mulberry. It can grow fast and spread easily via seed dispersal, primarily through birds and other animals

that eat its fruit. Due to its excessive growth, it has been considered as a type of weed badly affecting native flora in the country’s forests. Forester Pablito L. Alcachupas from t h e Fo re s t P ro d u c t s R e s e a rc h a n d Development Institute leads the project. The project team will conduct series of tests like sawmilling, veneering, seasoning, wood bending and machining in order to determine its wood density, shrinkage and strength properties. Classified under the strategic research and development banner program of the DOST-PCAARRD, this project will create better understanding of the basic characteristics of paper mulberry and how its use can be maximized. This will contribute to the cause of people living in the upland and communities that depend heavily on the forest and its resources. The results of the study can also provide more information on maximizing returns in converting its timber into various wood-based products, like lumber, furniture, hand-made paper, charcoal and pyroligneous liquor, or wood vinegar or wood acid. S&T Media Service

Biodiversity Monday BusinessMirror

Asean Champions of Biodiversity Media Category 2014

Monday, May 29, 2017 A13

Editor: Lyn Resurreccion • www.businessmirror.com.ph

First National Biodiversity Congress: Stakeholders call for protection, conservation

PHL biodiversity sustainable action plan launched

By Jonathan L. Mayuga

@jonlmayuga

arious Philippine stakeholders echoed the call for the protection and conservation of the country’s unique wildlife and ecosystem, amid threats that lead to the rapid rate of biodiversity loss.

In celebration of the International Day for Biological Diversity, various stakeholders, led by the Department of Environment and Natural Resources (DENR), gathered at a hotel in Ortigas, Pasig City, last week for the First National Biodiversity Congress to highlight the importance of the countr y’s natural wealth. The Philippines is considered as one of the 18 mega-biodiverse countries in the world. The three-day event, with the theme “Upswelling of Lessons, Sustaining Community Benefits in the Conservation of Landscapes and Seascapes”, paved the way for sharing of models and lessons on conservation initiatives in large territories and small communities. It also featured interactive plenary and breakout sessions on five thematic themes covering a wide array of topics related to biodiversity management, namely, Managing Protected Areas, Biodiversity-friendly Enterprises, Landscapes and Seascapes, Biodiversity Financing and special topics that include building an inclusive biodiversity community; and participation in biodiversity conservation of people’s, women, youth and communities in conflict-affected areas.

Biodiversity action plan

The congress paved the way for the launching of P334-billion Philippine Biodiversity Sustainable Action Plan (PBSAP), the country’s blueprint in managing its natural wealth. Developed through extensive consultations with various sectors at the national and local levels, the PBSAP identifies and aims to address priority global and domestic needs for integration into the plans and programs of various government agencies, including local governments. The PBSAP has identified and estimated Philippine Ecosystem and Biodiversity Values in terms of Ecosystem Service at P2.3 trillion. According to the PBSAP, timber and fuelwood production is worth around P1.1 billion; water, P50.9 billion; ecotourism, P157 billion; carbon offset, P453 billion; flood prevention, P41 billion; soil erosion; P10 billion; fishery production, P111 billion; crop production, P1.4 trillion; coral reef, P62.1 billion; and mangrove, P7.4 billion. To implement the PBSAP until 2028, the government will need

at least P337.9 billion to P393.3 billion, with the component to prevent habitat loss and overexploitation of protected areas (PAs) having the lion’s share at 39 percent.

Expanding protected areas

In her keynote address, Sen. Cynthia A. Villar, chairman of the Senate Committee on Environment and Natural Resources, underscored the importance of managing the country’s PAs. Incidentally, the Senate passed on third and final reading the Expanded-National Integrated Protected Areas System (E-Nipas) bill authored by Villar. It added 92 PAs to the 13 PAs currently backed by legislation. Several similar bills are being deliberated at the House of Representatives. The proposed E-Nipas Act of 2017 in the Senate, which seeks to amend the Nipas Act of 1992, or Republic Act 7586, recognizes conservation areas and the management reg imes of loca l gover nment units (LGUs), communities and indigenous peoples (IPs). According to Villar, the E-Nipas also ensures that the State shall establish “the institutional mechanism for the mobilization of resources and for adequate scientific and technical support for the conservation of biodiversity and integrity of the ecosystem”. “Preservation, maintenance and sustainability are key considerations when it comes to Nipas. The Philippines is also known as one of the 35 world’s biodiversity hot spots or regions containing exceptional concentrations of plant endemism, but experiencing high rates of habitat loss. Hot spots have lost around 86 percent of their original habitat and are also considered to be significantly threatened by extinctions induced by climate change,” she said. Villar said time has always been of great essence when it comes to the preservation and protection of the country’s biodiversity.

Underprotected

Villar said many areas in the Philippines remain underprotected. “Many wetlands, marine sanctuaries, tropical forests and others are underprotected and also lack resources to deal with various threats,” she said. Together with the DENR-Biodi-

Director Theresa Mundita S. Lim (right), of the Department of Environment and Natural Resources-Biodiversity Management Bureau, presents a book on biodiversity in the Philippines, a token of appreciation to keynote speaker Sen. Cynthia A. Villar during the First National Biodiversity Congress last week. Office of Sen. Cynthia Villar

Mount Apo Natural Park ACB

versity Management Bureau (BMB), Villar is pushing for the passing of E-Nipas bill that would include the remaining PA s requir ing congressional enactment. T he Nipas covers 240 PAs— 170 of which are terrestrial or land-based, and 70 are marineprotected areas (MPAs). O f t he 24 0 prote c te d a r eas, 113 have been established through presidential proclamation, as of March 2017. These comprise 29 MPAs and 84 terrestrial PAs. Of the 113 protected areas established through presidential proclamation, 13 have been legislated by Congress. Of the 92 protected areas to be added to E-Nipas, some are internationally recognized. These are Asean Heritage Sites Mount Timpoong-Hibok-Hibok and Mounts Iglit-Baco; Malaysia-Philippines Heritage Parks, Turtles Islands Heritage PA s; and Ramsar Sites Agusan Marsh, Olango Island and the Las PiñasParañaque Critical Habitat and Ecotourism Area. “The proposed E-Nipas Act will allow for greater involvement of communities and LGUs, as well as indigenous people and other sectors, especially the marginalized ones. It will also revise the prohibited acts and updates penalties for easy evidence gathering and prosecution,” Villar said. Preventing biodiversity loss and conser vation of landscapes and seascapes are included in the United Nations’s Sustainable Development Goals (SDGs), particularly No. 15. “The SDGs aim to conserve and restore the use of terrestrial ecosystems, such as forests, wetlands, drylands and mountains by 2020…. Urgent action must be taken to reduce the loss of natural habitats and biodiversity, which are part of our common heritage.… The clock is fast ticking away, let us act faster…. Let us continue working together so we can ensure that a still megadiverse country awaits the future generations of Filipinos,” she said.

Voluntary commitments

The congress also adopted the Philippine government’s voluntar y commitments to the SDG 14 on Life Below Water, which

will be presented to the Ocean Conference in New York in June. T he international conference from June 5 to 9 aims to be the “game changer” that will reverse the decline in the health of the world ’s oceans. Dr. Vincent Hilomen, project manager of Marine Key Biodiversity Areas (MKBA) of the DENRBMB, summarized these commitments into three main thematic areas, namely, governance socioeconomic and ecological. For governance, the commitments are: by 2024, the proposed E-Nipas Act is passed and LGUs have complied with the 15 percent of municipal waters as declared marine reserves under the fisheries code, with penalties for noncompliance. By 2020, t he comp e te nc y standards for management of PAs are established. By 2019, convergence areas for the Department of Agriculture and the DENR are mapped for coordination and complementation efforts; the importance of biodiversity and sustainable use of marine resources are mainstreamed in the education system. Socioeconomic commitment targets by 2020 for sustainable financing scheme for the management of MPA s are established in pilot coasta l communities. It w il l use biodiversit y- f r iend ly enter pr i se a nd promotion of co-management agreements and increased generated income from sustainable fishing for coasta l communities are increased. Also during the same period, the impact of investment are implemented in pilot areas around the country to support rightsbased fisheries management. The ecological commitments by 2020 state that marine pollution in coastal areas are significantly reduced, 10 percent of municipal waters are under effective zone management and 2 percent are managed by organized fishing communities. Also by 2020, MPA networks are established in MKBAs, and around 17,000-hectare portion of the Benham Bank and 2-million hectare of the 25 million hectares of the entire Philippine Rise (formerly Benham Rise) is

declared an MPA.

Coastal and marine ecosystem management

The DENR’s Coastal and Marine Ecosystem Management Program (2017-2028) was also unveiled at the congress. It is a 12-year national program and the country’s response to manage, address and effectively reduce the drivers and threats to degradation of the coastal and marine ecosystem. It aims to come up with a road map that will expand and deepen civil society’s participation in designing and implementing Global Environment Facility (GEF) programs, and contribute to its environmental protection and sustainable development goals. According DENR-BMB Director Theresa Mundita S. Lim, there will also be special forums to explore funding opportunities to support the biodiversity conservation initiatives of civil-society organizations, as well as LGUs. The DENR-BMB envisions a Philippine biodiversity that provides natural resiliency and sustained benefits for all. Its mission to conserve and sustainably manage the country’s biodiversity is anchored on the strengthening of the Nipas and fostering other effective area-based conservation measures, promotion of biodiversity-friendly livelihoods; and mainstreaming across all sectors of the government the biodiversity management.

Biodiversity Museum

As part of the biodiversity celebration, Lim and Sen. Loren B. Legarda, an environmental advocate, launched an initiative to establish the Museum of Philippine Biodiversity, and inaugurated Luis Junyee E. Yee Jr.’s installation art at the Ninoy Aquino Parks and Wildlife Rescue Center in Quezon City. A former BMB office building, the Salakot Building at the parks and wildlife center will be refitted into a museum, which will feature the beauty of Philippine biodiversity. It will highlight a number of PAs representing the different and unique terrestrial and marine ecosystems. “The museum will be an experimental and interactive venue

that aims to impart the richness and importance of the country’s biodiversity, as well as the threats it faces and the repercussion of its loss,” Lim said. Yee, an artist who is a pioneer of installation art in the Philippines, has built the first permanent installation art in the country found within the parks and wildlife center. Called “Ugnayan”, the artwork made use of big pieces of recycled hardwood pillars and metal to visualize the unity and cooperation of the 21 nations comprising the Asia-Pacific Economic Cooperation in pursuit of common goals in different fields.

Rich biodiversity

The Philippines, an island archipelago with 7,641 islands and islets, according to the latest count of the National Mapping and Resource Information Authority, harbors more diversity of life per hectare than any other country in the world. According to the DENR-BMB, protecting and conserving the country’s rich biodiversity offers tremendous benefits if put into good use. The country’s watersheds and aquifers could supply 479 billion cubic meters of water annually for domestic, industrial and agricultural uses. It also has huge potential in developing plant pharmaceuticals for common illnesses, such as cough, pain and dental problems. Every square kilometer of coral reefs can supply up to 30 tons of edible and economically important fish every year. It can boost ecotourism through development that safeguards the integrity and diversity of the country’s rich natural resources.

Hot spot

While the Philippines is endowed with rich biodiversity, it is also considered among the world ’s biodiversity hot spots. Threats to the countr y’s rich biodiversity, include over exploit ation and unsustainable practices, encroachment in forested areas, pollution, overfishing, poor land management practices and natural disasters exacerbated by climate change, according to the DENR-BMB.

ACB joins world in celebrating intl biodiversity day T

he Asean Centre for Biodiversity (ACB) joined the world in celebrating the International Day for Biological Diversity on May 22. With the theme “Biodiversity and Sustainable Tourism”, this year’s celebration focuses on raising awareness about the key contributions of sustainable tourism to economic growth and to the conservation and sustainable use of biodiversity. Home to a wealth of picturesque natural sites, the Asean region has become

a prime destination for backpackers, adventure-seekers and tourists who travel far to experience the rich biodiversity, astonishing landscapes and breathtaking seascapes found in Brunei Darussalam, Cambodia, Indonesia, Lao PDR, Malaysia, Myanmar, the Philippines, Singapore, Thailand and Vietnam. Among tourist destinations in the region are 38 Asean Heritage Parks—protected areas of high conservation importance, preserving a complete spectrum

of representative ecosystems and species of the Asean region. The 10 Asean member-states are promoting the protection of Asean’s natural heritage through these sites. They are implementing the Asean Heritage Parks Program to instill greater awareness, promote conservation, and provide a sense of pride and enjoyment of the rich natural heritage sites among the Asean people. These key life-supporting major ecosystems have provided a common agenda and united the

countries to better protect the environment and take responsibility and leadership for the sustainable management of their shared resources. One goal of the program is the promotion of recreation, tourism and ecotourism in these parks. This International Day of Biodiversity, we call on the private sector to support the conservation of natural heritage sites through the Adopt an Asean Heritage Park Program. Private-sector interventions, including sponsoring training

activities for park managers and rangers; building much-needed infrastructure; supporting communication, education and public awareness activities; and providing transportation for park workers can make a big difference for Asean Heritage Parks and biodiversityconservation efforts in the region. We also encourage everyone to know more about these Asean Heritage Parks and experience the many wonders that these natural treasures have to offer. With this invitation comes a reminder to

travel responsibly. Tourists can help preserve the integrity of the environment by respecting natural habitats and the wildlife found in these areas; disposing waste responsibly; respecting local communities living in travel sites; and choosing naturefriendly accommodation. In exploring landscapes and seascapes, let us keep in mind the importance of sustainable tourism. Let us ensure the balance between environmental, economic and sociocultural aspects of tourism.

A14 Monday, May 29, 2017 • Editor: Angel R. Calso

Opinion BusinessMirror

editorial

Why is there a provision for martial law?

S a result of the horrendous experience of martial law in the Philippines from 1972 to 1981, the initial reaction to the recent declaration for Mindanao was expected. People quickly assumed that the military would be in total control. The most notable voice of reason was Chief Justice Maria Lourdes A. Sereno, who almost immediately reminded the public and members of the judiciary that the courts in Mindanao were to remain open for business. That is the way a legal and proper martial law is supposed to function. We use that term “legal and proper” because, historically, a declaration of martial law by the government was not intended to be national in scope nor for a virtually unlimited period of time. There has always been a great difference between “military law” and “civilian law”. For example, active duty members of the US military are subject to the US Uniform Code of Military Justice. Civilian law allows a trial by a “jury of peers” or fellow citizens. The verdict in a military court comes from the presiding officer acting as judge or, if requested, a panel of three ranking officers. The idea then for “martial law” was that law enforcement and subsequent determination of guilt would be done or would follow the procedures found in the military courts. This was only to be implemented under a particular set of circumstances. During the Peasant Revolt in 1381 in England, even then arrests were made under martial law but the trials were held in civilian courts. The modern legal basis for the implementation of martial law is found in 14th-century England and comes from the theory or doctrine of “necessity”. Influential British attorney and judge Sir Mathew Hale wrote this in 1650 about martial law: “It is not law but something rather indulged than allowed by a law and that only in cases of necessity.” The US Supreme Court has repeatedly ruled the same way on this idea of necessity but also rejected military courts if civil courts are functioning. That is why Chief Justice Serrano made her statement. There might be the necessity for the King of England to grant local military or civilian officials with special, expanded and increased powers during situations that could not be adequately handled by going through the normal chain of command, potentially all the way to the Throne. In practical effect, the King was saying, “Take charge to do what you think is best. I give you my royal authority to do what you need to do until I can take charge again.” However, the US Supreme Court has specifically ruled that only Congress can suspend the writ of habeas corpus. While the declaration of martial law is rooted in that theory of necessity, abuses of civilian rights have been rampant, including in the US, known for its strong institutions. The US Supreme Court has mixed rulings on the suspension of other rights. However, there is one overriding legal principle found in free countries about the imposition of martial law. It may be necessary at times but it is even more necessary is to subject a declaration of martial law for the approval by the legislature. Since 2005

BusinessMirror A broader look at today’s business

The counterpart of financial assistance tuition and part of the remaining 60 percent to 70 percent of total expenses, then there is a bigger chance for the student to finish college and be able to secure a decent job after college. The fact is that there is help being offered—help from the government and private institutions. Some students and/or their parents may not be aware of these or they may not have the patience to go through the application and screening process, or maybe in some cases, they may simply be uninterested. We have to remember that offering help is only half of the story; the beneficiary or recipient should also be willing and able to help himself or herself. All the effort and hard work will have to come from the student and his or her family, including the willingness to do what needs to be done to reach the goal. So where can college students apply for StuFAPs? As far as government agencies are concerned, the following are just some of those that offer benefits for college

students: CHED, Technical Education and Skills Development Authority, departments of Science and Technology, Social Welfare and Development, Agriculture and Health, National Commission on Indigenous Peoples and Armed Forces of the Philippines Education and Benefit System Office. Students can take note of this for next year since it is already too late to apply for financial assistance at this time. What students and parents can do at this point would be to look at the requirements and qualifications, and then to complete these in time for the next round of screening. Now that we are beginning another school year, let us prepare to work hard and develop the values necessary to reach success. Let us not depend totally on other people to do things for us. Students, be ready to work hard this school year. Parents, be willing to support your children’s education so they can reach their dreams. When students put effort into their studies, they’ll reap the rewards in the end.

t is often said that good leaders make decisions without fear or favor. They are unafraid of potential consequences and understand the gravity of their decisions, knowing that making one choice over another will lead to either victory or defeat.

In public service, deciding against the interests of your family or friends is never easy. For most, if the fork is between pleasing your family or doing what is right for the country, it can be a choice between the devil and the deep blue sea—a situation with equally horrible alternatives. But for well-grounded leaders, it should be considered a no-brainer. These leaders have the courage to disappoint even their closest friends and allies, knowing that, as public servants, they swore to serve their people first. Hence, the fork where we must choose between family and country appears to be a seemingly difficult choice when in truth it is not. An immigration officer—who happened to be a daughter of a friend—was implicated in a humantrafficking case. As commissioner of the Bureau of Immigration then, I had the sworn duty to discipline our employees. I repeatedly warned

dent as he blew the opportunity to pass the course by way of a removal exam. He even boasted to the other student who took the exam with him that he didn’t study for it as he thought the exam was a mere formality. As to whether to pass or fail a student, I remember what one dean declared to his fellow faculty, “When the feeling is right, you can never go wrong.” A colleague in Philippine Airlines (PAL), Atty. Clara de Castro, has been with the Legal Department of PAL for 16 years. As she has the responsibility of reviewing contracts and transactions in PAL, she oftentimes encounters fork situations. Not afraid to lose her job or alienate some of her coworkers, this allballs lawyer and valedictorian from San Beda has almost always taken the position of the “legal right”. She guides the decision-makers in PAL to what is not only right under the law, but also fair under the factual circumstances. Clara simply needs

to keep her bosses aware of the dictates of the law and equity so they can arrive at an informed decision. Seeing most situations as a nobrainer, she has never been afraid to objectively voice out her analysis of any situation. And I think that’s what PAL or any other organization needs—someone who is fair, objective and not afraid to voice out her opinion. In his book A Good Lawyer, Atty. Bobby Quitain narrated an incident where he publicly shared his ideas in a forum and felt alone when nobody supported his views. Quitain suggested that standing alone is necessary for servant leaders to have maximum impact. Using the examples of Fr. Robert Reyes (controversial running priest) and Sir William Wallace (Scottish hero depicted in the movie Braveheart) among others, Quitain said being unafraid to speak your mind requires a greater form of courage, which is tenacity. Deciding against your family’s interest for the sake of a higher cause requires tenacity. Professor X and Clara both exhibited such tenacity needed for leaders under those circumstances to make the right decision. Tenacity allows leaders to have consistent courage when facing difficult choices. When these kinds of leaders are faced with forks down the road, deciding which path to take is a no-brainer.

Atty. Jose Ferdinand M. Rojas II

RISING SUN

lasses will formally begin on Monday, June 5. I hope students have taken the opportunity to relax and recharge, and get ready for another school year. For many college students, it’s still enrollment time—a challenging period for many parents. There is the issue of tuition increases in some private schools, and one of the most talked about topic: the free-tuition program of the government for state colleges and universities. It would seem as if there are few reasons (or excuses) a student wouldn’t be able to go to college these days. Aside from the freetuition program, there are other Student Financial Assistance Programs (StuFAPs) being offered not only by the Commission on Higher Education (CHED), but also by other government agencies. Plus, there are the institutional scholarships and private scholarship programs

Forks and no-brainers Siegfred Bueno Mison, Esq.

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from various organizations, foundations, corporations and other private individuals. According to data, tuition makes up around 30 percent to 40 percent of a student’s total cost of education. The other expenses would include miscellaneous fees, books, uniforms, board and lodging, transportation expense, etc. If a student could, for example, secure two StuFAP benefits to cover for

my friend and asked him to tell his daughter to stay away from these nefarious activities. But alas, I guess the temptation to exploit the newfound power and influence in the government was too much for her. As recommended by the Board of Discipline, she was charged with an administrative case. I was requested by my friend to spare the rod. I decided based on what I thought was right despite knowing I ran the risk of losing a friendship. The immigration officer was relieved from her post and subsequently suspended. My friend never talked to me again. Professor X encountered a fork situation when he had to choose between passing or flunking a law student whose parent was a powerful politician. Professor X was approached by influence peddlers through his law partner, his law school classmate and even his own father. As he recounted, X believes that he rightfully failed the stu-

For questions and comments, please e-mail me at sbmison@gmail.com.

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Monday, May 29, 2017 A15

Preventing and countering PPP Conversations #5 with LLDA PPP is viable since the LLDA, violent extremism being the sole agency mandated By Alberto Agra

PPP Lead

Atty. Lorna Patajo-Kapunan

legally speaking

t the annual meeting of the National Society of Legal Advisers of the Red Cross and Red Crescent Societies in Geneva on May 15 and 16, which I attended as governor and legal adviser of the Philippine Red Cross, the International Committee of the Red Cross/Red Crescent (ICRC) provided us with a document designed to provide background information and guidance on understanding “P/CVE”, which stands for Preventing and Countering Violent Extremism (a.k.a. “Terrorism”), which I am sharing in this column. President Duterte, who cut short his visit to Russia, declared martial law in Mindanao and also suspended the privilege of the writ of habeas corpus, which would allow the authorities to arrest people without a warrant. He said “IS” could not be allowed to gain a foothold in the Philippines and he would do whatever it takes to rebuff violent extremists or terrorists. n What is “violent extremism or terrorism”? There is no internationally agreed definition of “violent extremism”. In P/CVE theory, it is generally described as the way people come to embrace “radical” views and ideas that can lead to violent action, which may be inspired by or linked to groups and/or individuals described as “terrorists”. The dominant but contested theory of violent extremism focuses on social and political grievances (e.g., poverty, marginalization, lack of professional opportunities, political oppression and perceived injustices) that can be exploited to persuade individuals to support or commit to ideologically motivated violence in order to further political goals. While counterterrorism generally refers to the coercive measures states use to tackle “terrorism” (e.g., policing and judicial measures, blocking of financing, preventing detention, counterinsurgency campaigns and targeted air strikes), P/CVE is the use of noncoercive means to prevent or dissuade individual or groups from adopting “extremist views” that might lead to acts of terrorism. P/CVE is, thus, intimately related to and part of states’ boarder counterterrorism agenda. Owing to the lack of an agreed definition of violent extremism— and the broad and contested range of push and pull factors that P/ CVE initiatives aim to address—a variety of concerns have been expressed about the impact of P/CVE programs. These include the risk of stigmatizing some communities considered as vulnerable to violent extremism based on ethnicity, religion or race; the criminalization of individuals suspected of being “radicalized” in the absence of any unlawful acts; and the suppression of legitimate political opposition groups. States’ understanding that terrorism must be fought through more than military or security means is not new. Noncoercive and preventive measures to address this phenomenon have been part of counterinsurgency strategies and counterterrorism approaches for decades (e.g., the famous “winning hearts and minds” approaches). The concept of P/CVE, as it is now understood, emerged more than 10 years ago in the post-9/11 context out of concerns to address the root causes of terrorism. However, high-level and global interest in P/CVE has peaked in recent years because of the rise and spread of violent armed groups that claim to follow a particular “jihadist” ideology. Increasing attacks in various countries —including by states’ own citizens in some cases—and the phenomenon of “foreign fighters” have made P/CVE a security priority for states, as illustrated by the US’s White House Summit on Countering Violent Extremism in February 2015. In January 2016 the United Nations Secretary-General (UNSG)

unveiled a Plan of Action to Prevent Violent Extremism and called upon all states to develop national plans on PVE. The plan aims to tackle PVE through a comprehensive “all-of-UN” approach that requires all UN agencies, funds and programs to contribute to preventing this phenomenon across all three pillars of the UN’s mandate: peace and security, development and human rights. There is currently no agreement or undertaking at the global level on the drivers for violent extremism and the most effective means to address them—a point acknowledged in the UNSG’s plan of action. Some states have even resisted this agenda, preferring a more traditional counterterrorism approach. Nevertheless, due to the current political momentum, many countries are developing and implementing national plans based on their own assessment and understanding. P/CVE activities may include, among others: n Development programs for education, job creation and inclusion; community-engagement activities, especially with young people, aimed at fostering social cohesion, promoting democratic culture and dialogue, and providing economic and livelihood opportunities; and strengthening the capacity of governments to deliver services and security, and to ensure the rule of law and respect for human rights. n Deradicalization programs targeting individuals or groups at risk or already involved in “radical” movements or organizations. These are typically carried out in prison environments, and may include scholars engaging in religious and ideological debate with detainees. Special deradicalization facilities may be built or detainees may be segregated within prisons, based on perceived “radicalization”. n Training and/or revised responsibilities for police or armed forces. In some parts of the world, national counterterrorism forces or units are requesting specific training on the use of force and legal standards in strategies to reduce violent extremism. n Countering “extremist” propaganda and voices on social media and in communities by promoting “moderate” voices or the voices of victims of acts of terrorism. n Monitoring and intelligence-gathering activities targeting communities considered vulnerable to extremist’s views. Community groups, police, peacekeeping operations and even health personnel may be involved. President Duterte’s response to violent extremism/terrorism in Marawi City is to declare martial law in the whole of Mindanao, home to 20 million people. In his own words, “I’ll be harsh—I will do anything and everything to protect and preserve the Filipino Nation.” Now is not the time to question President Duterte’s judgment— there are enough safeguards in our Constitution to prevent abuse of his absolute power. Let history be the judge on the wisdom of the President’s action. But, for now, let us, as one people, collectively pray for peace, not only in Mindanao but also in our whole country.

Continued from A1

ursuing legal reclamation, addressing illegal reclamation activities and undertaking developmental and sustainable projects along Laguna Lake will be jointly explored and addressed by the two government agencies through government-togovernment (G2G) arrangements and public-private partnerships (PPPs). Your columnist, who witnessed the EOC signing, discussed the two-pronged strategy with LLDA general manager Medina. n What is your concept of PPP? The concept of PPP, as the name implies, is a contractual arrangement between a public and private establishment and /or entities where, through mutual agreements, utilizes the skills of the private sector for the delivery of certain services to the general public at no cost to the public sector (government). In a softer approach, PPP shall mean that the public (people) shall have

a chance to do business with the private sector. n What makes PPP a viable approach toward the development of Laguna Lake? PPP is viable since the LLDA, being the sole agency mandated to protect and develop the Lake, has no financial capability to undertake massive infrastructure development for Laguna Lake. The LLDA needs the financial resources of the private sector to undertake soft and hard infrastructure.

Auditing the auditors Joel L. Tan-Torres

DEBIT CREDIT Part One

he Board of Accountancy (BOA) is gearing up for the longoverdue implementation of the Quality Assurance Review (QAR) or the “audit the auditors” program. To recall, the BOA issued Resolutions 23 and 88 way back in 2009, providing for the guidelines for the adoption of the QAR. However, a group of small practitioners filed an injunction case in December 2010 in the Regional Trial Court (RTC) 128 in Caloocan City to stop the implementation of the QAR. The RTC issued an injunction order holding the implementation of the QAR resolutions and ordered the parties to settle the matter in a judicial dispute resolution (JDR) process. The contending parties subsequently agreed to settle the case after a meeting between the petitioners and the BOA chairman on July 4, 2010, in Waterfront Hotel in Cebu. In said meeting, an agreement, or the Cebu Accord, was reached on certain parameters to settle the case. Taking into account the agreed items, Resolution 2442015 and its implementing rules and regulations were approved by BOA on December 4, 2015. On June 24, 2016, the RTC issued an order dismissing the injunction case and paved the way for the full implementation of the QAR. The Office of the Solicitor General also wrote a letter, dated September 6, 2016, to BOA confirming that the QAR can already be implemented. The BOA has been planning on the detailed

implementation requirements to jump-start the QAR under a “soft” and “transitory” approach. The existence of a QAR is an essential facet in any accountancy and auditing environment. It is a global best practice that the auditors doing the attestation of the financial reports of business enterprises are subject to quality review or inspection of their work by an independent body. In the case of the Philippines, the BOA is mandated to “conduct an oversight into the quality of audits of financial statements through a review of the quality control measures instituted by auditors in order to ensure compliance with the accounting and auditing standards and practices” pursuant to Section 9 of the Republic Act 9298, or the Philippine Accountancy Act of 2004. Several major organizations had cited the Philippines for its failure to institute the QAR as mandated by the law. These institutions include the World Bank, the International

to protect and develop the Lake, has no financial capability to undertake massive infrastructure development for Laguna Lake. LLDA needs the financial resources of the private sector to undertake soft and hard infrastructure.

n How will G2G arrangements complement PPPs for the Lake? G2G arrangements shall stabilize, complement and give focus to all efforts done for the development of the Lake. It provides synergy and minimizes costs. In terms of solicited and unsolicited PPP proposals, the LLDA has never ventured into this kind of contractual arrangement. Sometime in 2014 the LLDA is a party to a project proposed by the Department of Public Works and Highways (DPWH), where the DPWH is the implementer and the LLDA is the cooperating agency. As cooperating agency, the LLDA was supposed to issue the authority to reclaim and other administrative permits that may be needed prior to the implementation of the project.

The BOA is mandated to “conduct an oversight into the quality of audits of financial statements through a review of the quality control measures instituted by auditors in order to ensure compliance with the accounting and auditing standards and practices” pursuant to Section 9 of Republic Act 9298, or the Philippine Accountancy Act of 2004. Federation of Accountants (Ifac) and a European Union (EU) study commissioned by the Professional Regulations Commission (PRC). The World Bank, in its Report of Observance of Standards and Codes (ROSC) and its recent engagements with the Philippine government, continuously presented the importance of putting in place the QAR in the accountancy profession in its ROSC on Accounting and Auditing in 2001 and 2006. Upon the request of the BOA, the World Bank has started the conduct of the preparation of ROSC when it sent a mission to the Philippines in February. The ROSC report that will be issued this year will include suggestions on the implementation of QAR in the country. The Ifac also cited the Philippines (or the Philippine Institute of Certified Public Accountant) its lack of QAR in the accountancy profession. This deficiency stands out in the statement of membership obligations (SMOs). The SMOs are a set of seven comprehensive description of the status of adoption of international standards and action plans to demonstrate compliance with the implementation. SMO 1 dealing on the Quality Assurance Review indicates that the Philippines has deficiencies and must be able to present an action plan how to address these.

When intel isn’t shared, criminals win

ritish police were justifiably furious when evidence from their investigation into the Manchester terrorist attack found its way into news reports. The leaks undermine the investigation and the confidence of victims and witnesses, whose cooperation is crucial. The immediate consequence is that Manchester police have stopped sharing information about their investigation with US officials, who are widely believed to be the source of the leaks. That is bad enough. The more long-term danger is that the leaks in this case will be used to argue against intelligence sharing more broadly. That would be tragic. This does not mean all information must be shared, or that strict rules shouldn’t be applied to how

While there are countless systems in place to govern and control such sharing—from Nato to Europol to many layers of bilateral ties— ultimately, they depend on one thing: trust. Countries share intelligence if they believe it’s in their interests. If the trust goes, the flow of useful information may stop. And the reality is that security services are famously protective of their information. It doesn’t take much for them to clam up.

that information is used. And there will always be tension between the public’s right to know about a threat and law enforcement’s need for discretion while investigating it. Yet, it is inarguable that national

security requires international cooperation. Intelligence sharing is vital not just to counterterrorism efforts but also to combat crimes, such as sex trafficking. While there are countless systems in place to govern and control such sharing—from North Atlantic Treaty Organization (Nato) to Europol to many layers of bilateral ties—ultimately, they depend on one thing: trust. Countries share intelligence if they believe it’s in their interests. If the trust goes, the flow of useful information may stop. And the reality is that security services are famously protective of their information. It doesn’t take much for them to clam up. The only winners from a breakdown in cooperation—whether it’s withholding information or failing

n What do you think are the challenges and risks of PPPs for the Lake? Challenges and risks abound in the pursuance of PPPs, specifically for Laguna Lake. It is considered a challenge because PPP is a way to go forward, because the government can utilize the resources of the private sector for the provision of services whose direct beneficiaries are the people. It is risky because the government might not be able to fulfill arrangements as specified in the contracts, thus, penalties may occur to the detriment of the taxpayers, and/or the private sectors may not effectively deliver the committed projects and/or services. Also, private business interests will inevitably come into play, so the preservation of the Laguna Lake as a living natural resource should at all times be of paramount concern. There is a need for close government supervision and monitoring on the projects undertaken. n What is your message to the public? Rest assured that Laguna Lake, being a vital resource within the Laguna de Bay region, shall be the LLDA’s utmost priority. The LLDA shall ensure that sustainable development shall be adhered to.

The profile of the SMOs of the Philippines can be viewed at ac.org/aboutifac/membership/members/philippineinstitute-certified-public-accountants. However, the write up indicated must have to be updated on the current developments in the QAR. The EU report as commissioned by PRC was released in June 2016. This report (Brockman report) which was facilitated by Jane DrakeBrockman, presented an assessment of the competitiveness standing of 12 professions in the Philippines. The assessment of the accountancy profession is included in this Brockman report. This assessment disclosed that there is “significant identified weakness” in the quality assurance area, while the profession is competitive in four areas of market conditions and trendsskills shortages, core competency standards, language skills and personal attributes and salary-fee level expectations. The BoA now is focused on addressing these observations of deficiencies arising from the nonimplementation of QAR. It is putting in place the steps for the “soft” and “transitory” approach implementation of the QAR. To be continued Chairman Joel L. Tan-Torres is the chairman of the Professional Regulatory Board of Accountancy. He is a Certified Public Accountant who placed No. 1 in the May 1979 CPA Board Examinations. He is concurrently a tax partner of Reyes Tacandong & Co., CPAs. He was the former Commissioner of the Bureau of Internal Revenue from 2009 to 2010. This column accepts contributions from accountants, especially articles that are of interest to the accountancy profession, in particular, and to the business community, in general. These can be e-mailed to boa.secretariat.@gmail.com.

to adequately support cooperative ventures—are criminals and terrorists. Breakdowns will still happen, of course. That is worth bearing in mind as the UK and the US investigate the latest leak, as they should. And it’s worth keeping in mind during Brexit negotiations as the UK recalibrates its relationship with Europol, to which it contributes disproportionately but from which it also gets benefits. In both cases, national leaders will almost certainly support the principle of cooperation. That was the case with UK Prime Minister Theresa May and US President Donald J. Trump, who met in Brussels on Thursday. It’s what happens a few levels down, however, that will give their words meaning. Bloomberg View