SBEP Magazine 2016 by Jimmy Hilario

SBEP STRATEGIC BUSINESS ECONOMICS PROGRAM

NOVEMBER 2016

7.1%

GDP, Q3 2016

P171B APPROVED

Unleashing RPotentials

PPP

$5.4B FOREIGN

INVESTMENTS

4.04M TOURISTS

Jan-Aug 2016

9.4%

DOMESTIC DEMAND

Q3 2016

21.6% POVERTY INCIDENCE 2015

2.9% GROWTH

AGRICULTURE

2016

Contents $5.4B FOREIGN

INVESTMENTS

4.04M TOURISTS

Jan-Aug 2016

9.4%

DOMESTIC DEMAND

Q3 2016

<<Story on page 4>>

21.6% POVERTY INCIDENCE 2015

Now on its 42st year, the Strategic Business Economics Program is accepting limited applications to its Executive Education offering: Executive MBE (Master in Business Economics) and Executive CBE (Certificate in Business Economics) • A convergence of Economic Principles, Business Techniques, and Strategic Management • Designed for CEOs, CEO Designates, and Owners; Heads of Public Agencies and Institutions, and Senior Policymakers • A modular schedule suited for top executives • With research support from the School of Economics and the CRC Foundation Be part of a great tradition and a network of executives in an atmosphere of academic excellence and real business applications.

Strategic Business Economics Program, 6/F, School of Economics, APEC Communications Building, University of Asia and the Pacific, Pearl Drive, Ortigas Center, Pasig City / Email: sbep@uap.asia / Tels. 634-2820 / 634-3095 / 634-2821

4 7 12 15 20 24 28 34

More Certainties Than Alleged Uncertainties Decoupling from Global Weakness

Reassuring Views from Independent Observers Right-of-Way Right Away

SBEP Class 2016 The 2016 Golf Tournament and Homecoming Dinner Characters of Class 2016

2016 Jakarta Trip

Editor-in-Chief

Victor A. Abola, Ph.D.

Editorial Assistant

Alonica R. Salazar

Contributors Engr. Maria Catalina E. Cabral, Ph.D. Bernardo M. Villegas, Ph.D. Viory Yvonne T. Janeo Melanie Cecilia S. Lapore

Editorial

Victor A. Abola, Ph.D.

Unleasing RPotentials

Before the New Millennium the Philippines was dubbed as the “sick man of Asia”. It went into a tailspin in 1984-85 after the Aquino assassination with two years of -7.0% decline in Gross Domestic Product (GDP). The resulting fall in per capita income needed 17 years to recover as the economy had been plagued by foreign exchange shortages, high inflation rates, large public sector deficits, and a boom-bust pattern of growth. Politically, the coup attempts only stopped with the ascendancy of Gen. Fidel V. Ramos into the Presidency in 1992. And with him, the country began to grow respectably once more, but the Asian Financial Crisis of 1997-98 broke the momentum. Out of ICU and Into Running Track Things have changed dramatically with the onset of the New Millennium. In the first 10 years under Pres. Gloria MacapagalArroyo the economy averaged 4.9% annual growth in GDP. This accelerated under Pres. Benigno Aquino III to 6.1%. Last year (2016) the economy expanded by 6.9%, the highest in East and Southeast Asia, beating China (+6.8%) and Vietnam (6.2%). It appears that the country is finally getting into a fast growth mode by tapping into its acknowledged potentials. Foreign exchange reserves can now cover more than 9 months of imports, interest rates are aligned with China, Malaysia and Thailand, inflation has been below 2% in the past two years, and public debt to GDP ratio has dropped to 42.1% by 2016, lower than Malaysia, Thailand and India. In short, the sick man has not only left the ICU; he has gone into the running track promising to go full speed ahead. Aiming High The new president, Rodrigo R. Duterte, and his economic managers have now raised the bar and have targeted economic growth of 7%-8% in 2017-2022. At the same time, they also would like to bring down the poverty rate from 21.6% in 2015 to 14% by 2022. And for the first time, the country 2

UNLEASHING RPOTENTIALS

has a long-term economic plan up to 2040, by which time it projects the economy’s graduation into a developed country status. These may be ambitious goals, but we think reachable. Attaining those goals would require unleashing the country’s potentials. First, we have the human capital. Here we will have the demographic window period, wherein the labor force continues to expand, through which more advanced countries have passed during their economic development. It is also during that period when those countries grew quite rapidly. Analysts think the Philippines’ demographic window should extend between 2015 and 2050. After all, the country has the youngest median age in the region placed at 23, compared to 25 in Malaysia and 28 in Indonesia. But these people must be trained and/ or educated to become truly productive. For that we already have K+12 in place since the beginning of the current school year in July 2016. For vocational training, K+12 offers a track in addition to ongoing TESDA programs. The Conditional Cash Transfer (CCT) involving cash for poor families sending their kids up to high school contributes as well to develop adequate human capital. Constraints to Growth No Longer Financial In the past financial constraints dominated the set of obstacles to economic growth. We had low levels of dollar reserves, interest rates were double-digit with credit difficult to obtain and inflation exceeded at least 5%. These are no longer the constraints to growth. Constraints are now more physical and governance. Primary among the physical constraints is poor infrastructures. The latter is obvious to all—huge traffic problems in Metro Manila, Metro Cebu and other major cities. Clearly, capacity in major airports have long been exceeded. The mass transit and rail systems are not only inadequate, but in some cases, could also be a danger to life and limb. Fortunately, there is public money for these now. For example, infrastructure

spending to GDP has increased from a 1.5% low in 2005 to a 30-year high of 4.4% in 2016. And the PNoy and the current administration would like to raise this percentage to more than 7% by 2022. In addition, large PPP projects, like the P45 B Calax Expressway, the P56 B LRT-1 Extension, and the MRT-7 project have hit the ground or about to in Q1. Supporting this and tourism, we have the article of Undersecretary Dr. Ma. Catalina E. Cabral pointing out that the new Right of Way law (ROWA) enacted in March 2016 will eliminate much of the delays due to valuation issues when the government wants to obtain a right-ofway from private persons. She notes that 90% of cases involve this problem and the law provides a quick solution that should satisfy the concerns of private property owners. In short, the ROWA will now allow the government to have projects carried out Right-Away. Governance and Politics Governance has always been a problem of the country. In general, the bureaucracy will be better remunerated closer to levels in the private sector through 4 phases of increases specified in the new Salary Standardization Law (SSL). But politics is another thing. Many believe that politicians often get in the way of economic development by prioritizing their self-interest. That’s is one of the reason why many Filipinos voted for Pres. Rodrigo Duterte to remove that obstacle. But many controversial statements (often retracted or corrected) of the President have stirred concerns about political and policy stability. Dr. Bernardo M. Villegas’ two articles address those. In the end, development is not only for the people. It can be accomplished only by the people. Everyone should contribute to the common good in the best way possible, even if at times, self-interest may be served as well. We certainly hope President Duterte lives up to expectations and continues to lead the country not only to prosperity but also to be accorded dignity within the international community.

SBEP Team (L-R) Ledinia G. Coates, Executive Assistant; Wilrose M. Gorumba, Program Assistant; Lea T. Riñon, Marketing & Alumni Affairs Coordinator; Victor A. Abola, Ph.D., Program Director; Alonica R. Salazar, Marketing & Alumni Affairs Manager; and Viory T. Janeo, Academic Coordinator. The SBEP Coordinating Committee, whose members include Dr. Rolando T. Dy, Director of CFA, Dr. Vaughn F. Montes, Ph.D., Fellow of ICD, and Dr. Victor A. Abola, SBEP Program Director, ensures faculty staffing from the University.

APPLIED BUSINESS ECONOMICS PROGRAM The Applied Business Economics Program (ABEP) is a Master’s program for young managers who are looking for more than the usual in a graduate business course. In addition to the fundamental management areas of production, marketing, and finance, ABEP also covers macroeconomic and microeconomic analysis, industry analysis, forecasting, and project analysis. Equipped with these tools, the ABEP graduate is prepared to make sharp business and economic analyses as well as draw out implications of business decisions—at the level of the company, the industry, and the economy as a whole. For inquiries, please contact Ms. Elsie Tingzon at 637-8549 / 637-0912 loc. 225 & 375 or email: abep@uap.asia

Business Economics Club To make sound business decisions, you’ll need more than just information. You’ll need insights, analyses, and well-founded forecasts. The Business Economics Club will give you all these, in a language which is simple, without being simplistic.

For any inquiries, you may call Ms. Mary Grace Agner at 637-0912 loc. 251 or 374. You may also reach BEC through fax no. 631-1280

INDUSTRIAL ECONOMICS PROGRAM CORPORATE INTERNSHIP We are inviting you to participate in the IEP Corporate Internship Program. The program matches companies of SBEP executives who need graduate student interns to do any of the following tasks: • Macroeconomic and industry analysis • Market research • Pre-feasibility studies • Forecasting • Socio-economic profiling The program aims to provide the graduate student interns the opportunity to sharpen the knowledge and skills they have acquired from the program. For inquiries, please contact Mr. James C. Caswang at 637-0912 loc 348 or email james.caswang@uap.asia

More Certainties Than Alleged Uncertainties Bernando M. Villegas, ph.d. Full Professor, UA&P

83%

Approval Rating

7.1% GDP

The colorful, mercurial and impulsive style of President Rody Duterte has prompted credit rating agencies and some foreign chambers of commerce to raise the alarm flag about the investment climate in the Philippines. It is possible we may not get any credit upgrade for the coming months or even years. It is possible that some U.S. and European investors may cancel or at least postpone their investment decisions in the Philippines until PDu30 can modify his harsh language and/or issue more consistent policy statements. Knowing how ingrained some of his linguistic outbursts and biases against the U.S. are, it may take some time before the cloud of uncertainties can be removed from the horizon of the Philippine economy. Investors would have no other alternative but to take chances, which after all is the very essence of entrepreneurship, i.e. assuming risks. First, let me try to lessen the anguish about the foul language used by the Cebuano-speaking President. As I have told audiences of expats and foreign diplomats, in the name of objectivity, there is 4

UNLEASHING RPOTENTIALS

need to remind journalists to translate his colourful language more accurately. When the President uses the “P” word or equivalent every time his temper flares, what comes out of his mouth is an expletive very much like the “F” word that some Americans use when they are angry. When some of us use the milder expletive “Damned it” to express our anger, we know we are not condemning our addressee to literally go to hell. By the same token, when the “P” word (borrowed from Spanish) is used in a vulgar conversation, it is not accurate to say that the one uttering it is calling the addressee a “son of a whore.” I am not implying, however, that we should excuse the President for using foul language in his public statements. He should remember he is occupying the highest leadership position in the land. He is giving a very bad example especially to the youth. He is destroying the widespread image of the Filipino as a gentle, amiable, polite and caring person, an image that has endeared especially the Overseas Filipino Workers in their respective host countries and has explained our outstanding success as Number

Special Feature One in customer service to call centres. As a man endowed with a free will, the President can still be helped by the people closest to him to use less objectionable expressions when expressing his anger. Even assuming that it may take time for the President to change his style, I enjoin creditors and investors to focus on the certainties about the Philippine economy. They will realise that what we can posit for certain about the Philippine economy will make the uncertainties perceived by the likes of Standard and Poor pale into insignificance. First, the Philippine economy will be enjoying for many more years the close to $30 billion of annual remittances from the OFWs. From what I have observed over the last ten years, this source of a consumption-led growth has increased at 3 to 5 % annually through all the crises that the global economy has suffered (e.g. the Great Recession, the political crises in the Middle East, the precipitous decline in the price of oil, etc.) Second, whatever happens to political leadership at the national level, the young, growing and English speaking population of the Philippines will continue to make the Philippines a preferred site for the global Business Process Outsourcing and Knowledge Process Outsourcing industries. In the next two years, this sunrise industry will be generating also close to $30 billion annually and growing at 15% from year to year, employing close to 1.5 million highly educated Filipinos. The incomes generated by these two engines of growth will feed into the consumption sector and will generate large investments in retailing; the hospitality business (to cater to the 40 million domestic tourists resulting from the expansion of the middle class); and expansion of manufacturing of food, fashion goods, and furniture and fixtures. Construction and real estate will continue to benefit from the demand for more middlepriced condominium and residential units and for office spaces to cater to the BPOIT sector, with more of the expansion in the second-tier cities like Iloilo, Bacolod, Davao, Cagayan de Oro, Laoag and others outside the National Capital Region. We can also count as certainties the maintenance of a stable financial sector by a very competent Central Bank that

Those who become indecisive because of the alleged or real uncertainties clouding the investment horizon in the first one hundred days of the Duterte Administration are in danger of missing the business opportunities that can be clearly discerned from the certainties I mentioned. has admirably institutionalised inflation targeting tools, keeping average inflation at the level of 2 to 3 % annually and moderating the depreciation of the Philippine peso. We can also consider as certain the ability of the Department of Finance and the Department of the Budget to continue maintaining fiscal discipline which began during the Administration of former President Gloria Macapagal Arroyo. I would give 80 percent probability to our having a new tax structure that would lower the corporate income tax and the tax burden on the middle-income households (those earning between P1 to P3 million annually). Despite the lowering of taxes on these two sectors, there will be compensating increases in income taxes for the very rich, specific taxes on unhealthy drinks and other consumer items, and from here-to-fore tax exempt industries that are profitable enough to survive without tax privileges. I will also count as a certainty the greater ability of the present Administration to implement at least 17 more Private-Public Partnership Projects for the whole year of 2017. Add to this the willingness of the decision makers in the fiscal sector to significantly increase government spending on infrastructures to as much as 7% of GDP. Underspending by the Government on public works will be a thing of the past. Fortunately, the Philippine financial sector is awash with liquidity, making it possible for all these investments to be financed mostly form local funds. Even if temporarily, the uncertainties perceived by U.S. and European entities should slow down the influx of foreign portfolio and direct investments, there will be enough

funding from local sources that can enable the Philippine economy to grow at more than 7% in 2017. If we are able to address the concerns of foreign investors and creditors about the Duterte style of management during the first year of his presidency and are able to amend the restrictions on foreign direct investments still found in the Philippine Constitution, a growth rate of 8 to 10 percent is achievable from 2018 to 2022. With a more open attitude towards foreign direct investments, we do not even have to wait for investors from the U.S. and Europe where leaders are more understandably very sensitive about human rights violations. There are numerous investors from our Northeast Asian neighbours (China, Japan, South Korea and Taiwan) who are less touchy about human rights and can significantly increase their investments in the Philippines, especially in infrastructures ( airports, railways, power plants), manufacturing, agribusiness and logistics. I have not even inputted into my calculations the possible large increase of infrastructure spending that can result from the more proactive role that will be played by some Governors and Mayors as they fully implement the provisions of the Local Government Code of 1991 under which they can raise revenues and spend on their own projects without the need to get the nod from National Government. The desire of President Duterte to move towards a federal form of government would augur well for some governors and mayors to already declare their respective territories as virtual federal states under the Local Government Code. I see this happening in such provinces as Batangas, Palawan, Negros Occidental, Iloilo, Quezon, Aurora, Ilocos Norte, Davao and other areas where the local government officials can hit the ground running in implementing their respective infrastructure projects. Those who become indecisive because of the alleged or real uncertainties clouding the investment horizon in the first one hundred days of the Duterte Administration are in danger of missing the business opportunities that can be clearly discerned from the certainties I have enumerated above. SBEP MAGAZINE 2016

Cover Story PHILIPPINE ECONOMIC PERFORMANCE

Decoupling from Global Weakness The Philippines’ growth performance, as reflected in the country’s gross domestic product, has continued on an elevated path. This ability to weather international storms is also evident in gains both in the industrial and agricultural sectors. What are the factors behind this resilience? What changes and challenges can we expect for the rest of 2016 until 2017? This article provides some answers.

Victor A. Abola, Ph.D. Senior Economist School of Economics, ua&p

and

Viory Yvonne T. Janeo

Economist School of Economics, ua&p

In the past five years, the growth momentum of the Philippines’ gross domestic product (gdp) has been on an optimistic upward track, further reinforcing the status of the country as one of Asia’s fastest-growing economies. In the third quarter of 2016, the gdp beat market consensus, accelerating to 7.1%. Investments sustained their rapid pace, expanding by 20%, driven by the 8.6% gain in industrial output.

Coupled with the surprise positive 2.9% growth in the agriculture sector, the economic performance surpassed expectations enabling the Philippines to outperform its asean and East Asian neighbors, including China. This remarkable performance occurred amidst the global weakness. The reason? The still-robust domestic demand1. Regardless of a global economy that has been characterized as weak in recent years, the Philippines has continued to grow in the last five years because of very strong domestic demand. In fact, domestic demand growth consistently exceeded gdp growth, fueling economic expansion in the past five years. In particular, the 5 year average growth of the domestic demand stood at 7.8%. In Q1 to Q3 2016, domestic demand registered a y-o-y growth of 12.0%, 11.8% and 9.4%, respectively. In terms of investments, the country has achieved double-digit numbers in 13 of the 16 quarters in the past four years. The commendable gains in investments has proven to be highly beneficial in measuring the 1

Domestic demand is the summation of consumption, investment and government spending. SBEP MAGAZINE 2016

Cover Story Quarterly GDP Growth Rate

months into Duterte’s presidency, roughly P223.5 million have already been budgeted for ppps at various stages of approval. 10.0 Consumption growth rate on a year-on9.0 year basis has also fast tracked to a solid 8.0 growth pace of 7%+ in 2016, with an above 7.0 5.5% performance in 17 of the last 20 6.0 quarters. Remittances of overseas Filipino 5.0 workers have remained robust despite the 4.0 current problems in the Middle East, which 3.0 has affected the employment of Filipinos in 2.0 this region. 1.0 Furthermore, national government spen0.0 ding has also reached double-digit growth in 13 of the last 18 months, indicative of the growth of infrastructure projects being Source of Basic Data: PSA implemented in the country. In this regard, Q4-2016 GDP Growth slowed down to 6.6% government consumption growth rate has Domestic Demand & GDP Growth Rate also regained a faster momentum. The Figure 2 • Growth of investments, first quarter of 2009 to (y-o-y) Q1-2009 to Q3-2016 third quarter of 2016 tourism industry has blossomed this year with a recorded 4.04M tourists arriving Despite Weak Global Economy 14% between January and August, representing a growth of 12.6% from the same period last 12% year. Strong infrastructure spending in tourist 10% destinations has significantly contributed 8% to the surge in numbers and is expected to attract at least another million tourists before 6% the yearend. 4% Poverty incidence has also resulted in a 2% sharp 3.6% drop for the years 2012-2015 as the outcome of swift domestic growth, 0% Domestic Demand GDP which translates to higher job generation. -2% This figure is equivalent to 3.4M people out of poverty in three years. Recall that in 2006, Source of Basic Data: PSA the percentage of Filipinos living in poverty Domestic Demand Has Fuelled Growth in last 5 years stood at 26.6%, which gradually improved to country’s overall performance, considering that investments 21.6% in 2015. have been recognized as the new and desired economic driver. This positive note happened amidst the global weakness. The The investment-led growth is reflected in the notable growth in Eurozone is experiencing a slowdown in gdp growth rate, which capital goods imports at above 20% in the last 12 consecutive dropped from 0.5 to 0.3 during the second and third quarters months. Likewise, foreign direct investments have performed of 2016. In the Middle East and North Africa region, the fall of exceptionally well with a total value of $5.4 billion from January crude oil prices has greatly impacted the world market. This year to August, and which is most likely to reach a new full-year record also witnessed the slowdown of Japan and China’s economies. for 2016. Meanwhile, the United States is in a slow yet sure recovery. It An important policy agenda that President Rodrigo Duterte currently records good growth in its gdp, which rose from 0.8% to has chosen to prioritize during his presidency is the growth of 2.9% in the last three quarters of 2016. This result paved the way annual public-private partnership (ppp) projects approved and for more employment opportunities, with a recorded 180,000 completed yearly. Recent data has shown that the National jobs per month since August. Although this figure represented Economic and Development Authority has already approved a 20% drop from the 220,000 per month average last year, it ppp projects worth P171.3B, with P74.6B of this total to be still puts the us at a good standing in terms of employment allotted for the renovation and expansion of the Ninoy Aquino generation. In addition, the consistent growth of its inflation rate, International Airport. As of early October 2016, P52.2B worth moving from 0.1 to 1.2 for 2015 and 2016, respectively, as well as of ppp projects have been approved by the ic Technical Board, the 1.5% projected value for 2017, puts the us on the right track with 21B already allocated to Rural Development Projects. Three to achieve the Federal Reserve’s 2% inflation rate target.

UNLEASHING RPOTENTIALS

Q32016

Q2 2016

Q1 2016

Q4 2015

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2009-Q1 Q2 Q3 Q4 2010-Q1 Q2 Q3 Q4 2011-Q1 Q2 Q3 Q4 2012-Q1 Q2 Q3 Q4 2013-Q1 Q2 Q3 Q4 2014-Q1 Q2 Q3 Q4 2015-Q1 Q2 Q3 Q4 2016-Q1 Q2 Q3

Figure 1 • Philippines’ GDP growth, first quarter of 2009 to third quarter of 2016 (y-o-y) Q1-2009 to Q4-2016

Cover Story Investment Growth Rate

Consumption Growth Rate

Figure 3 • Growth of investments, first quarter of 2009 to third quarter of 2016

(year-on-year, Q1-2009 to Q3-2016)

60%

Double-digit in 13 of last 16 quarters

50%

40%

7% 6%

Investments – the NEW, desired Economic Driver Economic agenda on track The Philippine growth narrative remains intact as we expect investments continuing to expand by double digits and consumer spending keeps a 7% growth path. Besides, infrastructure spending will likely accelerate in the fourth quarter and into 2017. Considering the turnaround in export demand, we expect at least 7% gdp growth in the fourth quarter. In 2017, a 7%-8% economic expansion is achievable. At the start of his administration, President Duterte outlined a strategy for overall development within the country through the creation of a 10-point economic agenda. This agenda focused on the specific issues that the President would be prioritizing throughout his term as head of state. The 10-point agenda aims to: (1) maintain current economic policies and reforms in tax collection agencies, (2) accelerate infrastructure spending to 5% of gdp and finetune ppp, (3) raise competitiveness to attract fdi and improve ease of doing business, (4) focus on agricultural productivity as part of rural development, (5) ensure security of land tenure, (6) strengthen the educational system, (7) review tax brackets and index them to inflation, (8) expand and improve the Conditional Cash Transfer (cct) program, (9) enhance innovation and creative capacity towards selfsustaining and inclusive development, and (10) reinforce responsible parenthood and the Reproductive Health Law. Reforms have emphasized economic policies and tax administration, and tax brackets are currently undergoing heavy scrutiny, with much analysis focusing on the gravity of the nationwide impact of these changes. On the other hand, projects in infrastructure spending and ppps, agri-productivity and rural development, as well as the cct program have already been budgeted and are awaiting implementation. Finally, amendments

Q3 2016

Q2 2016

Q1 2016

Q4 2015

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Q4 2009

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Source of Basic Data: NSCB

Q3 2009

Q2 2009

-30%

Q1 2009

2009 2009 2009 2009 2010 2010 2010 2010 2011 2011 2011 2011 2012 2012 2012 2012 2013 2013 2013 2013 2014 2014 2014 2014 2015 2015 2015 2015 2016 2016 2016

-20%

Q3 2012

Above 5.5% in 17 of last 20 quarters

-10%

Q2 2012

Q1 2012

10%

Q4 2011

20%

Q3 2011

30%

-40%

(year-on-year)

Source of Basic Data: PSA

Solidly at Faster Pace, 7%+ in 2016 Microeconomic forecasts

Inflation Rate

2014

2015

2016

2017

4.1

1.4

1.8

2.6

Peso-Dollar Rate

44.62

46.75

48.50

50.50

Gross Int’l Reserves ($B)

79.6

82.5

86.0

90.0

GDP Growth Rate

6.1

5.9

7.0

7.2

Industry Sector

7.9

5.6

8.2

8.6

Services Sector

5.9

6.4

7.0

7.1

to the educational system via the K-to-12 program have pushed through and are now implemented across the Philippines. In addition, the Long-term 2040 Development Plan has been approved and will be used as the country’s roadmap to attain its goals. Thus far, the current administration has been successful in fulfilling the items on its 10-point agenda, with a positive outlook that these initiatives and programs will be effectively carried out. Some threats to watch out for Notwithstanding its current priorities, the government also has to give due attention to impending issues that could prove problematic for the country. Much of these concerns revolve around power and infrastructure shortages, specifically these may have pushed logistic costs upward due to Metro Manila traffic and port congestion, both long-standing problems that have yet to be effectively addressed by policy and implication. The severity of these problems have led the President to call for the use of emergency powers to implement drastic changes that could help alleviate these issues faster. Another concern is a possible housing bubble that would result in a slowdown in real estate developments. Finally, there is the need to improve the President’s approach to foreign affairs and diplomacy, and its effect on fdi and the relationships of the Philippines with neighboring and partner countries. SBEP MAGAZINE 2016

MBE Graduates June 2016 Three distinguished SBEP alumni were awarded a Master in Business Economics (MBE) during the twenty-first UA&P graduation ceremony held at the PICC Plenary Hall last June 4, 2016. The recipients of the MBE completed all course requirements of the certificate program and successfully defended their thesis.

John Edward P. Hernandez VP - Operations, Victory Liner, Inc.

"Victory Liner Inc. Going Public: A Feasibility Study on the Companyâ&#x20AC;&#x2122;s Initial Public Offering "

Danilo J. Mojica, II

President, Consumer CreditScore Philippines Inc. "Developing a Competitive Strategy for Think.Able"

Olegario J. Magahin, Jr.

Acting Bank Officer IV, Bangko Sentral ng Pilipinas "Resilience of Philippine Real Estate Firms from New External Shocks in the Environment: A Bangko Sentral Perspective"

SBEP MAGAZINE 2016

Reassuring Views from Independent Observers Bernando M. Villegas, ph.d.

Full Professor, UA&P

Despite some understandable criticisms from human rights advocates from the U.S. and Europe, it is reassuring that perceptions about the Philippine economy are still generally positive from outside independent observers. It is especially encouraging that two multilateral lenders—the Asian Development Bank (ADB) and the International Monetary Fund (IMF)—have raised their 2016 growth forecasts for the Philippines on the back of solid economic fundamentals, i.e. continuing increase in consumer spending, low rates of inflation and interest, low fiscal deficit and government debt, and increase in manufacturing output. Last September 26, 2016, the IMF said that the “outlook for the Philippine economy remains favorable despite external headwinds, prompting the international bank to raise to 6.4 percent from 6 percent previously its growth projection for 2016. The ADB also raised its growth forecast of the Philippines to 6.4 percent from 6 percent previously. According to Richard Bolt, ADB country director for the Philippines, what is particularly encouraging about the Philippines was its very solid ten-point socio-economic agenda aimed at slashing poverty to 17 percent by 2022 from 26 percent at present. I have been especially impressed with the September 2016 Special Report of one of Hong Kong’s leading think tank, CLSA Limited. Let me quote from its Philippine report entitled “Duterte cracks the whip”: “President Duterte has been fortunate in taking over a strong economy with a sound fiscal position. The Duterte administration took office at the end of June with 2016 real GDP growth at 7% YoY and substantial fiscal space following deficit containment below 1% of GDP in 2014-2015. The investment upswing will be going into its sixth year in 1Q/2017 reinforced by Mr. Duterte’s planned infrastructure spending push. We forecast accelerating real GDP growth from our 6.8 estimate for 2016 12

UNLEASHING RPOTENTIALS

Special Feature to 7% in 2017, with this pace sustained in 2018.” In CSLA’s overall assessment of growth prospects in the whole of Asia, the Philippines ranks next only to India that is expected to grow at 8% or more in the next two years. To the naysayers who are overreacting to the unorthodox ways of Duterte, CSLA has the following very practical advice: “Investors attracted by the strong growth prospects in the Philippines will have to accept the risks arising from Mr Duterte’s unsavory policies (such as the extrajudicial killing of suspected drug dealers). Duterte’s decisiveness is a welcome change after tardy progress by his predecessor, Mr. Aquino. However, the test will be to alter the perception that the Philippines lacks the capacity for efficient implementation, without undermining civil institutions. Follow-through on Duterte’s commitment to lift the foreign investment limit will be another key test, especially given increased risk stemming from a twin deficit in 2017. Mr. Duterte has broader visions of raising living standards for the poor which, if he succeeds, will be an accomplishment that has eluded previous administrations in the Philippines.” As I have written in several newspaper columns, focus of investors doing business in the Philippines should be the continuing increase of dollar remittances from more than 10 million OFWS. These remittances are now being converted at P48 or more pesos to a dollar, stimulating the consumption-led growth that is also bolstered by the almost identical dollar earnings from the more than one million workers in BPO-IT sector that continues to grow at a hefty 15% annually. These two engines of growth are fuelling domestic consumption, the most notable of which is in the 40 million middle-income Filipinos who are the first tourists in their own country. Another multiplier effect of these revenues is the booming housing sector and the building of office spaces for the BPO workers, both of which are increasingly moving towards second-tier cities outside the National Capital Region. The expansion to the regions is leading

Like every other decent human being, I would like to persuade President Duterte to change his uncouth language and penchant for off-the-cuff remarks with significant policy implications which he has not completely thought through. I would also want to see the force of law being used to prosecute policemen or vigilantes who have been involved in illegal killings, whether or not related to the campaign against the drug epidemic. to the multiplication of retailing outlets in some of the more remote areas in the countryside. Add to these consumption-driven sectors the highly probable investment boom in infrastructures as the Duterte Administration shows greater decisiveness in increasing its budget for public works to 5% and even 7% of GDP and more importantly, actually spending the budgeted amount, which was not the case in the last Administration. There are already very clear signs that the much awaited Public Private Partnership (PPP) projects are finally taking off in larger numbers. As many as 17 of these projects are due for implementation in 2017. More open to unsolicited proposals and the Swiss challenge, the Duterte Administration is also encouraging the more enlightened and proactive governors and mayors to take advantage of provisions of the Local Government Code of 1991 to undertake their own PPP initiatives. If these LGU units partner with private companies in joint ventures in which the private party has majority ownership, they can implement these projects without getting any clearance of the National Economic Development Authority (NEDA), a bureaucratic step that has slowed down actual spending in the past.

As one example, Batangas province has in the works a railway connecting Calamba, Laguna to Batangas City; the conversion of the Fernando Base in Lipa City into an secondary airpot to Manila; expansion of the Batangas City seaport to decongest the Manila port; and more modern highways to improve access to the numerous tourist spots of the province. The example of Batangas can encourage other LGU heads to promote their own PPPs in partnership with both local investors (such as Metro Pacific, ICST, San Miguel Corporation, the Ayala Corporation, Megawide, etc.) as well as foreign investors coming from Japan, South Korea, Taiwan, and China who are less sensitive to the so-called human rights issues than the Americans and the Europeans. The bullish mood of our Northeast Asian neighbors will be further enhanced if Speaker Pantaleon Alvarez and Senate President Koko Pimentel can focus on amending the restrictive provisions of the Philippine Constitution that have discouraged Foreign Direct Investments in the past. They should follow the example of the Vietnamese Government that recently liberalised even more its laws concerning FDIs. Vietnam is attracting there times the level of FDIs of the Philippines. Like every other decent human being, I would like to persuade President Duterte to change his uncouth language and penchant for off-the-cuff remarks with significant policy implications which he has not completely thought through. I would also want to see the force of law being used to prosecute policemen or vigilantes who have been involved in illegal killings, whether or not related to the campaign against the drug epidemic. If these changes do not happen overnight, however, I would enjoin those who want to promote the common good of Filipinos to do whatever they can to still take advantage of the numerous opportunities still available in the country to generate much needed jobs for millions of unemployed and underemployed, taking the President’s undesirable behaviour as an unavoidable business risk.

SBEP MAGAZINE 2016

Right-of-Way… Right Away The New Infrastructure Right-of-Way Acquisition Law RA 10752, signed March 7, 2016 Engr. Maria Catalina E. Cabral, Ph.D.

Undersecretary for Planning and PPP, Department of Public Works Highways (DPWH) President, Philippine Institute of Civil Engineers (PICE)

ROWA’s Impact on Infrastructure Delivery National government infrastructure projects are crucial to the growth and development of a nation. For this reason, the government has the inherent power of eminent domain which ensures that the government can acquire private land for projects in exchange of just compensation to affected property owners.

because the legally mandated first offer, which was the BIR Zonal Value, is usually lower than Market Value making it unacceptable for owners.

Main Factors of Delay and Issues with Old ROWA Law The process of ROW acquisition has caused major delays in the implementation of national government infrastructure projects under the old law on ROW acquisition. The main factors of delays the government usually faces are the following: 1. Failed Negotiation with Property Owners: Lengthy negotiations with land owners without reaching an agreement (up to 90% of cases)

Under the old law, Republic Act (RA) No. 8974, otherwise known as An Act to Facilitate the Acquisition of RightOf-Way, Site or Location for National Government Infrastructure Projects, Appropriating Funds Therefore and for Other Purposes, enacted in 2000, the government’s first offer to these owners as compensation in a negotiated sale is the affected lands’ zonal valuation as issued by the Bureau of Internal Revenue (BIR), and the replacement cost of the improvements on the land. This offer is usually rejected by owners because it is too low. The government then makes a second offer based on the recommendation of an Appraisal Committee. Although Implementing Agencies (IAs) may opt to procure Independent Property

Appraisers (IPAs) for appraisals, clear guidelines for such procurements were not provided in the law. Moreover, the risk of overpricing properties and being questioned upon audit makes expropriation a more favorable mode of acquisition for IAs. 2. Delayed Issuance of Writ of Possession during Expropriation: After negotiations fail, the expropriation case will be submitted to the court. The issuance by the court of a Writ of Possession, which is critical to start the project, takes a long time, averaging about 2 years, and for some projects, as long as 11 years. The Department of Public Works and Highways (DPWH) can directly attest SBEP MAGAZINE 2016

Special Feature to the chronic delay problems that the acquisition of Right-of-Way (ROW) can bring to our infrastructure projects. The DPWH is responsible for around half of the infrastructure projects of the national government and has received budget allocations that have increased by four times in the last six years, equivalent to more than 15,000-20,000 projects nationwide. Due to delays in the ROW Acquisition (ROWA) process, the Department greatly suffers in delivering much-needed infrastructure, whether it is funded under the General Appropriations Act or through the Public-Private Partnership scheme. The New Right-of-Way Act (RA10752) On March 7, 2016, President Benigno S. Aquino III signed into law Republic Act No. 10752, AN ACT FACILITATING THE ACQUISITION OF RIGHTOF-WAY, SITE, OR LOCATION FOR NATIONAL GOVERNMENT INFRASTRUCTURE PROJECTS, or simply called The Right-of-Way Act. This new law aims to fast-track and simplify the ROW acquisition process, address failed negotiations with property owners, and avoid the lengthy expropriation proceedings in courts, by making the offer and terms of negotiation more attractive for the owners by enabling the Implementing Agencies to have the FAIR MARKET VALUE as the FIRST OFFER, instead of BIR Zonal value, to be determined by an Independent Property Appraiser or a Government Financial Institution, to wit: “SEC. 5. Rules on Negotiated Sale. – The implementing agency may offer to acquire, through negotiated sale, the right-of-way site or location for a national government infrastructure project, under the following rules: “(a) The implementing agency shall offer to the property owner concerned, as compensation price, the sum of: (1) The current market value of the land; (2) The replacement cost of structures and improvements 16

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The New Right-of-Way Act (RA10752): In Summary Lessen the Delays in Acquisition of Private Properties to Fast-track Infrastructure Development •

TYPE A DELAY: Failed Negotiation with Property Owners: – – –

•

TYPE B DELAY: Delayed Issuance of Writ of Possession during Expropriation in Courts –

•

Lengthy negotiations with land owners without reaching an agreement (up to 90% of cases) because the legally mandated first offer, which is the BIR Zonal Value, is usually LOWER than Market Value There is no legal guidance for government agencies to negotiate higher than BIR Zonal value The issuance of Writ of Possession critical to start the project takes a long time, average of 2 years, and for some projects, as long as 11 years.

The NEW Right-of-Way Act addresses A, so that B (Courts) will be avoided therein; and (3) The current market value of crops and trees therein. “ To determine the appropriate price offer, the implementing agency may engage the services of a government financial institution with adequate experience in property appraisal, or an independent property appraiser accredited by the Bangko Sentral ng Pilipinas (BSP) or a professional association of appraisers recognized by the BSP to be procured by the implementing agency under the provisions of Republic Act No. 9184, otherwise known as the “Government Procurement Reform Act” and its implementing rules and regulations pertaining to consulting services.”

This gives enough incentives for the property owner to accept the offer, as well as gives confidence and security for the Government to proceed with the negotiation without fear of audit disallowance. This new law should largely discourage and avoid the acquisition process ending up in courts for lengthy expropriation process. The new ROW Act intends to shift the priority of government to achieving more efficiency and speed of ROW acquisition more than targeting the potential savings from bargaining with the owners regarding the BIR Zonal value of their properties. It acknowledges

that time is the most valuable resource in implementing infrastructure projects because the Government is not just taking into consideration the value of the infrastructure itself, but also the value of all other superstructure (e.g., of businesses, factories, deliveries, tourism establishments, and so on) that will be built because of the infrastructure project. The heart of the law, therefore, is the economic efficiency of agreement between the owners and the Government happening at the earliest possible time. The Government may always insist on its power of eminent domain. This power is, however, tempered by the Constitutional provision that “private property shall not be taken for public use without just compensation.” The power of eminent domain should always consider how the citizens and the market put value on a property; otherwise, the entire process is bound to become a lengthy one that causes perennial delays for everyone.

The new ROW Act intends to shift the priority of government to achieving more efficiency and speed of ROW acquisition more than targeting the potential savings from bargaining with the owners regarding the BIR Zonal value of their properties.

SBEP MAGAZINE 2016

Special Feature

Additional Salient Provisions of the New Act The ROW ACT also addresses other issues on land ownership and infrastructure development: 1 ) Gratuitous Titles Under Commonwealth Act (CA) 141, gratuitous titles, or titles donated by the Government, can be acquired for free when needed by Government projects. This causes conflicts and oppositions especially for those property owners who have acquired the property from a market transaction with the original patent holder. Under the proposed Law, owners who are not the original patent holder of the land – who have acquired the land through a market transaction – shall be exempted from CA 141, and thus, can expect an offer of market value from the Government. The Department sees this provision as an additional solution in reducing the backlog of ROWA oppositions, as provided in Section 4 of the proposed Law:

“In case of lands granted through Commonwealth Act No. 141, as amended, otherwise known as “The Public Land Act”, the implementing agency shall:

a) Follow the other modes of acquisition enumerated in this Act, if the landowner is not the original patent holder and any previous acquisition of said land is not through a gratuitous title; or b) Follow the provisions under Commonwealth Act No. 141, as amended, regarding acquisition of right-of-way on patent lands, if the landowner is the original patent holder or the acquisition of the land from the original patent holder is through a gratuitous title.” 18

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2) Subsurface or Subterranean Portions of Private and Government Land - With growing urban development, projects underground or those that will use subsurface or subterranean portions of private and government land, such as subway railways, tunnels, and underpasses, will be necessary for continuous development. Thus, Section 4 of the new Law provides that:

“… the government or any of its authorized representatives shall not be prevented from entry into and use of the subsurface or subterranean portions of such private and government lands by surface owners or occupants, if such entry and use are made more than fifty (50) meters from the surface.”

Hence, the Department welcomes this additional provision as enabling of a new set of infrastructure projects in the years to come. Effects of the New Act This new ROW Act will enable the accomplishment of the following: 1) Fast track and simplify negotiated sale as the preferred mode of ROW acquisition, by making the price offer and terms of negotiation more attractive and just for the owners, and at the same time enabling Government implementing agencies to quickly adopt a market-based price without fear of audit disallowance, while ensuring that the rights of property owners and other projectaffected persons are duly protected. 2) Streamline the expropriation process in case the negotiated sale option fails. 3) Make government budget preparation for ROW acquisition and project implementation more systematic and predictable, addressing the buildup of backlog of ROW claims for payment.

Caveat: Challenges to the Efficient Implementation of the New Act The intention of the new Act is clear for all stakeholders. However, there are a number of challenges being faced by the DPWH as far as the Implementing Rules and Regulations (IRR) and even at the particular interpretations of the Law and the IRR. Major challenges include: 1) Engaging the Services of the Government Financial Institutions (GFIs) – there are clarifications being made on whether the Implementing Agencies can directly engage the GFIs through negotiated agreement or there is a need for competitive bidding. 2) “Accredited” Independent Property Appraisers (IPAs) In engaging the services of the independent property appraiser, the new Act states that the IPA must be “accredited” by: a) Bangko Sentral ng Pilipinas (BSP) or b) a professional association of appraisers recognized by the BSP

For this requirement, the DPWH is still coordinating with BSP a list of accredited IPAs, either from BSP or from a professional association recognized by the BSP. BSP, expressing their concern about their capability and responsibility to accredit appraisers and association of appraisers, has yet to release the list of their accredited IPAs, or their list of recognized professional association of appraisers.

3) Differences in Computing the Capital Gains Tax

The New Act intends to shift the burden of facilitating the payment of the capital gains tax from the property owner to the government. This provision acknowledges the fact that

Special Feature

Old Law (RA 8974)

New Law (10752)

First Offer Price by the Implementing Agency (IA), as mandated by the existing Law, is BIR Zonal value which is usually too low to be accepted by the owners

Make the First Offer the fair market value to reduce negotiation time

IAs are reluctant to negotiate property price upwards:

In line with international best practice, authorize the IA to offer fair market values for land, crops/tress and structures/ improvements as determined by third-party professional entities - Government Financial Institution (GFI) or Independent Property Appraiser, to be hired by the IA.

a. Law provides legal cover for the first offer (BIR Zonal value), but vague on the terms and implementation of negotiating with the property owners. b. Most IAs do not have the in-house competence to determine the fair market value of the lot, and do not have clear legal cover to hire independent property appraisers. c. IAs find it risky to determine and offer real market value of land/crops/trees and replacement cost of structures/ improvements, acceptable to the property owner, and not susceptible to disallowance upon audit. Delays due to conflicts with Informal Settlers, not entitled to compensation for their structures

there are challenges in this regard, one of which is the availability of cash for the private owner to immediately pay capital gains in order to transfer the title of the property to the Republic of the Philippines. Thus, Section 5. (c) of the Act states:

â&#x20AC;&#x153;With regard to the taxes and fees relative to the transfer of title of the property to the Republic of the Philippine through negotiated sale, the implementing agency shall pay, for account of the seller, the capital gains tax, as well as the documentary stamp tax, transfer tax and registration fees, while the owner shall any unpaid real property tax.â&#x20AC;?

There are, however, some minor differences in the way this provision

Based on international best practice, make provisions for compensation for structures/ improvements of Informal Settlers

is interpreted and calculated at the detailed accounting level of the implementing agencies. The DPWH and the Bureau of Internal Revenue are coordinating with respect to this challenge. The DPWH is currently crafting a new procedural manual on ROW acquisition, in line with the new Act and its IRR, leading the way for other government agencies who may want to adopt it for faster implementation of their infrastructure projects. It is also leading the way in gathering comments and recommendations in further improving the existing IRR to better reflect the intention of the new Act. Way Forward The economy of the country finished strong in 2016 with a 6.8% growth in

Gross Domestic Product, one of the fastest economic growth in whole of Asia. This new ROW Act was designed to lessen the delays in the implementation of government infrastructure projects, which in turn will lead to faster and earlier utilization of benefits for the people. Combined with the audacious goal of the new Administration of a Golden Age of Infrastructure (5%-7% of GDP for public infrastructure spending), the bigger goals of faster and more inclusive growth of the Philippine economy can be achieved right away. And thus, to take advantage of the momentum of economic growth, availability of local and foreign money and technical expertise, and the completion of the new Philippine Development Plan, infrastructure development must be implemented way faster than the economic activities it wishes to support. This strategy starts with acquiring RIGHT-OF-WAY, RIGHT AWAY.

SBEP MAGAZINE 2016

SBEP Class 2016

ALIGGAYU, Roberto L. “Bob”

Director Public Safety Mutual Benefit Fund, Inc.

AMBI, Maria Belenda Q. “Bel”

Regional Director/Director IV Department of Trade and Industry-IX

APOSTOL, Geraldine H. “Gett” Partner Isla Lipana & Co. /PwC Philippines

ATCHIOCO, Evangeline H. “Vangie” Vice President – Finance DMCI Project Developers, Inc.

CAMMAYO, Jesus T. Jr. “Jun”

Executive Consultant National Grid Corp. of the Philippines

CANTOS, Michael C. “Mike”

COMANDANTE, Mark Philip C. “Mack”

Vice President – Vismin and Plantation Leads Agricultural Products Corp.

CARPIO, Mark Anthony G. “Mark”

Executive Vice President Grand Monaco Estate Developers, Inc.

CASTAÑEDA, Agusto S. “Augie” Group Head – Value Chain Nutri Asia, Inc.

BORLAZA, Aldric G. “Deric” CFO/VP DMCI Mining

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CO, Bryan Andersen T. “Bry”

AVP – Engineering D.M. Consunji, Inc.

CHIU, David Paul T. “David”

Head – Technical Procurement National Grid Corp. of the Philippines

Director – Specialty Solutions and Services Zuellig Pharma

CRISOL, Jose B. Jr. “Joey”

First Vice President & Head – Investor Relations and Corporate Communications GT Capital Holdings, Inc.

CRUZ, Joel C. “Joel”

General Manager South Asialink Credit Corp.

DETERA, Gina S. “Gina”

Partner Isla Lipana & Co./PwC Philippines

SBEP Class 2016

EVANGELISTA, Jerome T. “Jerome”

GATDULA, Antonino E. Jr. “Toni” VP/CFO DMCI Power Corp.

LAZO, Macrina P. “Rina” Head – Retail Banking Analytics East West Bank

FAJARDO, Joy B. “Joy”

GATUS, Romerico Q. Jr. “Jon” Senior Vice President – Operations Romtech Construction, Inc.

MANAPAT, Richard Kristoffer S. “Chad” Head – Corporate Planning Century Pacific, Inc.

FLORECE, Bernardo C. Jr. “Bernie”

INCIONG, Elias Jose M. “Bong” President United Broiler Raisers Association

MANGUBAT, Eillen B. “Apples” General Manager Asialink Finance, Corp.

FRANCISCO, Maria Theresa F. “Thess” Branch Head – OSS CLES Public Safety Mutual Benefit Fund, Inc.

IRENEA, Teddy A. “Ted” First Vice President – Special Project SBU D.M. Consunji, Inc.

MIANO, Edeward C. “Ed” Group Head – Strategic Business Asiapro Multi Purpose Cooperative

GAHITE, Marilyn G. “Alen” Head – HRMD Armed Forces and Police Savings & Loan Association, Inc. (AFPSLAI)

LAPORE, Melanie Cecilia S. Vice President – Corporate Communications RII Group of Companies

OBCENA, Romeo S. Jr. “Jun” Vice President for Logistics Leads Agricultural Products Corp.

Department Head Seaoil Philippines, Inc.

Chief Accountant/Accounting Officer DMC Urban Property Developers, Inc.

Vice President Public Safety Mutual Benefit Fund, Inc.

SBEP MAGAZINE 2016

SBEP Class 2016

OCAMPO, Rodelito J. “Dodo” Head of Construction Operations Makati Development Corporation

PALACIOS, Patricia P. “Trisha” General Manager Global Dominion Financing Inc.

PEDRAGOSA, Caroline Grace M. “Grace” Director - PBSP Inclusive Business Center Philippine Business For Social Progress

PUA, Ronald Allan F. “Allan”

President/General Manager Powerlift Elevator & Escalator Corp.

PUNZAL, Geronimo L. “Gerry”

President and Chief of Operations RX Global Sales Marketing Corp.

QUE, Conrad Y. “Con”

TRAPA, Nove-Rei F. “Novz”

QUIMBO, John Carlyle D. “John”

VILLARUZ, Normita L. “Noemi”

RICO, Ma. Patricia I. “Pat”

ZALAMEDA, Francisco M. Jr. “Jun”

CONTROLLER Santeh Feeds Corp.

Vice President – Group Business Development Fastcargo Logistics Corp.

Vice President – Sales and Marketing Santeh Feeds Corp.

RUBIO, Michela Sophia E. “Michelle” Senior Vice President & HR Director Unionbank of the Philippines

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TOLEDO, Willy S. “Willy”

First Vice President – Building SBU D.M. Consunji, Inc.

AVP – Corporate Services Fastcargo Logistics Corp.

Managing Partner & Founder Villaruz, Villaruz & Co., CPAs

AVP-General Manager – RMC Division D.M. Consunji, Inc.

SBEP MAGAZINE 2016

Celebrating SBEP’s 42nd Anniversary:

The 2016 Golf Tournament and Homecoming Dinner

by Alonica R. Salazar

The Strategic Business Economics Program, UA&P’s flagship program for top executives, celebrated its 42nd anniversary featuring a Golf Tournament at Valley Golf and Country Club and a Homecoming Dinner at Oakwood Premier Joy-Nostalg Center last March 11, 2016. The success of both festivities could be attributed to the generosity and hard-work of Class 2016 the host batch. The memorable and enjoyable day commenced with a Golf Tournament at the South Course of the Valley Golf and Country Club. Dr. Victor Abola (SBEP Director), Mr. Omar Cruz (CEO and President of BPI-Philam), and Mr. Mark Philip Comandante (Class 2016 President), led the ceremonial tee-off at 8:00am. Old

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friendships were rekindled and new ones forged as the tournament breezed through the day. A total of 51 alumni, current participants, and guests competed in the golf tournament. Mr. Arnold Jumalon (guest) came out as the Overall Champion and Mr. Te San Pedro (guest) emerged as the Lowest Gross Champion. Division winners were Gen. Ding Sevilla (Class 2014) for Class A; Dr. Henry Basilio (professor) for Class B; and Mr. Rolando Poco (guest) for Class C. Batch Champion was Class 2016 represented by Mr. Allan Pua, Gen. Roberto Aliggayu, Mr. Deric Borlaza, Mr. Jon Gatus, Mr. Jun Cammayo, and Mr. Mark Comandante. For the Fun Holes, Mr. Arnold Jumalon (guest)

bagged Nearest to the Pin at Hole #12 – 16ft. to the hole. Mr. Ira Valte (guest) won the Most Accurate Drive at Hole #7 – on the line; and Mr. Rolando Poco (guest) bagged the Longest Drive at Hole #10 – 290 yards. Unluckily, nobody won the Toyota VIOS, which was the Hole-inOne prize. Our golf tournament players were delighted to go home with a fantastic NIKE giveaway package comprised of a dry-fit shirt, golf cap and a sleeve of balls. The SBEP and Class 2016 would like to thank the following sponsors for making the 2016 SBEP Golf Tournament a huge success and for contributing generously to the SBEP Endowment Fund: for Platinum Sponsors – Harbour Centre Port Terminal,

Inc., DMCI Holdings, and South Forbes Golf Club; for Gold Sponsors – National Grid Corporation of the Philippines, Stradcom Corporation, Tollways Management Corporation, and Joratech Corporation; for Silver Sponsors – Ayala Land, Inc., AMOSUP, Isla Lipana & Co. / PWC, PruLife UK, Land Bank of the Philippines, F.R. Sevilla Industrial and Development Corp., First PGMC Enterprises, Inc., Steel Centre Philippines, Inc., Steel Trust Corporation, RX Global Sales and Marketing Corp., Villaruz, Villaruz & Co., CPAs, Right Link Security Agency, Global Dominion Financing, AsiaLink Finance Corporation, South AsiaLink Credit Corporation, DMCI Mining, GT Capital Holdings, Inc., Fastcargo Logistics Group, Metropolis Construction, Inc., Public Safety Mutual Benefit Fund, Inc., Asiapro Multipurpose Cooperative, DMCI Project Developers Inc., Santeh Feeds Corporation, Romtech Construction, BBR Philippines Corporation, DMC Urban Property Developers, Inc. Pascual Consumer Health Care, Ms. Honey Gonzales, LEADS Agricultural Products Corp., Hyundai Philippines, United

Broiler Raisers Association, and First Metro Investment Corporation. The festivity continued on at the Nostalg Ballroom of Oakwood Premier Joy-Nostalg Center Manila to celebrate the alumni homecoming. A total of 110 alumni, current batch, guests, faculty, and staff graced the Homecoming Dinner. The entertaining program started with an invocation by Ms. Noemi Villaruz, Class 2016 participant. The welcome address was given by Mr. Mark Comandante (Class 2016 president) and the masters of ceremonies for the night were Ms. Melanie Lapore and Mr. Joey Crisol (both Class 2016 participants). The highlight of the dinner was a spectacular performance by the celebrated band – the BLOOMFIELDS, who entertained all the guests with signature renditions of the ’60s and ’80s rock music. Likewise, Mr. Jose Enrico Villaruz serenaded the audience with ballads. The thrilling live performances and the fantastic raffle prizes glued the audience to their seats. Our lucky guests were happy to bring home the following major raffle

prizes – 2 Golf Memberships for 1 year at South Forbes Golf City, 3 gift certificates for 2 pax for a 3D/2N stay in a Studio Suite at Alta Vista Boracay with breakfast, 40” Full HD TV, dining certificates at Edsa Shangri-la, gift certificates at Vietura Aesthetic Lifestyle, Sofitel……and still a number of exciting door prizes. Hon. Adrian S. Cristobal, Jr., Secretary of the Department of Trade and Industry, Chairman of the Board of Investments, and SBEP Alumnus Class 2014, delivered the inspirational message to the alumni and guests. The homecoming dinner formally concluded with our program director, Dr. Victor Abola’s closing remarks. The SBEP would like to convey its sincerest thanks and appreciation to all the sponsors and donors for their generous contribution to the SBEP Endowment Fund. Likewise, the program would like to acknowledge Class 2016 and the dependable SBEP staff for making the festivities of SBEP’s 42nd Anniversary an unforgettable and remarkable experience for all the alumni and guests!

SBEP MAGAZINE 2016

Seminar

Intensive Training on Bonds The SBEP organized a three whole-day “Intensive Training on Bonds” last November 23 to 25, 2016 at UA&P Living Room. It was attended by 12 senior executives from various private financial institutions and the government sector. The Intensive Training on Bonds equipped the participants with a systematic and integrated learning on all bond and bond-related products available in the market today. Computer based exercises were provided to the seminar participants to facilitate straightforward and practical learning. Dr. Victor A. Abola, SBEP Director, also an Economist and Finance Expert, delivered the course for Days 1 & 2. The following topics were covered: Credit Analysis and Interest Rate Risk; Bond Types and Conventions; Basic Fixed Income Mathematics; Zero-Coupon Pricing and Yield Estimation; Fixed-Rate and Floating-Rate Bonds; Bond Yield Curves; Measures of Return on Investment; Interest Rate Sensitivity; Managing Portfolio Risk; Convexity; and Convertible Bonds. For Day 3, Ms. Mari Toni S. Bautista, CFA, Head of Security Bank’s Corporate Desk and Treasury Group – FX and Rates Hedging, delivered the following topics: Bond Portfolio Management Models; Holding Period Yield Immunization; Bond Portfolio Management Strategies; ROPs and Foreign Denominated Bonds. The Intensive Training on Bonds is being offered by the SBEP bi-annually, in May and November. It is designed for the knowledge and appreciation of Chief Financial Officers, Treasury Managers, Bond Traders, Bank Officers, Risk Officers, Investment Managers, Trust Managers, Certified Public Accountants, Lawyers, and Individual Investors. Interested participants may call the SBEP Secretariat at 6342820 / 6343095 / 6370912 loc. 222 or send an email to sbep@uap.asia. (by alonica r. salazar)

SBEP MAGAZINE 2016

Characters of Class 2016 ALIGGAYU, Roberto Licarte Gen. Bob is a man of few words but when he speaks, he delivers it with gusto. Don’t take him too seriously though as at times he pitches amusing jests. Even with his stature, he is easy to get along with. He is authoritative and yet friendly to everyone. —Bernie Florece Jr.

continues to be in charge of the Company’s cash generation and management, loans & receivables management and treasury functions. Her love of God, positive attitude, academic background and experiences would be her tool for continued personal and career growth.” —Joy Fajardo

AMBI, Maria Belenda Queza

CAMMAYO, Jesus Tumbokon Jr.

I admire Bel for her commitment and dedication in attending class every month coming all the way from Davao. Her presence is felt because she always shares her perspectives on trade policies and programs in class.“ —Grace Pedragosa

“JTC is a no non-sense guy at DMCI Engineering Department. Very approachable and a very good mentor to all his staff.” —Jun Zalameda

APOSTOL, Geraldine Hammond “She is definitely a leader with a heart and beauty that runs in the family. Her team recognizes her as an inspiring, caring person, thoughtful, as she remembers them on their special day. Above all, the role she plays, she loves to be recognized as a loving wife and mom to her 3 kids. Great job, Gett!!!” —Gina Detera ATCHIOCO, Evangeline Hernandez A mother of two lovely girls, a Certified Public Accountant and a former member of SGV. She is currently the VP for Finance of DMCI PDI or DMCI Homes and 28

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CANTOS, Michael Camara He is our class Guru in Agriculture, next of course, to Dr. Rolly Dy. He is always willing to share his knowledge to classmates who are planning to venture into farming. From sweet corn, cacao, banana, pineapple, coconut, mango, atbp. Name it, he always knows how to grow it.” —Jun Obcena Jr. CASTAÑEDA, Agusto Salazar “Augie is definitely the Mr. Nice Guy of SBEP 2016. Quiet and unassuming, he has a ready smile that reflects his inner warmth and kindness. When it comes to SBEP requirements, Augie is truly dedicated and committed. He is the perfect group mate who always delivers what is needed.” —Joey Crisol

CHIU, David Paul Tan “David is known for his reliability in delivering quality work at the most efficient manner. His continuous interest in expanding his horizon makes him a very capable and promising leader. He has gone a long way from being a junior site engineer to heading the technical procurement unit of the country’s sole power transmission company. This is a testament of his commitment and outstanding work ethic.” —Bryan Co CO, Bryan Andersen Yao “Bryan is the only person I know who can understand and work effectively on a wide range of levels. He is able to conceptualize top level strategies, make executive decisions while at the same time understand the intricacies of how these decisions will be carried out. At school, he is good at creating concepts for group presentations, while at the same time create the most effective presentations for these.” —David Chiu COMANDANTE, Mark Philip Cainhog “When the time came for SBEP 2016 to elect its Class President, choosing came easy. There was one who exuded leadership qualities—the energetic, personable and smart Mack Comandante. He lobbied for our requests from the School, he rallied for group study sessions, and he campaigned

Testimonials the class to surpass records in most every way. These and in many other ways, long after this Course is completed, you will always be our PMack!” —Melanie Lapore CRISOL, Jose Borromeo Jr. With that characteristic smirk, Joey Crisol may intimidate. But watch him closer and discover the man who is intensely loyal and loaded with wit and charm. He is one of the few who can engage the lecturers in an intelligent repartee because he always knows whereof he speaks. He is obviously a happy family man, an accomplished professional and a classmate that everyone is comfortably proud to have. I am personally excited to see the heights he will explore and conquer in the coming years!” —Melanie Lapore CRUZ, Joel Camantigue The Great Joel Camantigue Cruz I have known Joel for 20 years but my “best friends forever” for only 19 and a half years (a back story that would require another page). He is a loving father, a friend you can truly count on, a hard-working GM, a very good leader. Most people find him funny and so care free but not a lot know that he is really shy, serious, prayerful, sensitive and a romantic at heart. I could write his story but it would be best to let his life unfold for all our classmates to discover—a precious gem, the one, the only, the unique, Joel Cruz— one truly great guy!” —Apples Mangubat DETERA, Gina Santos The dedicated and committed person--be it at home, church, office, social events, etc. You can rely on Gina to give her best

always as a way of sharing her God-given deep inside, you will find a very joyful, gifts and blessings. She is just a call away! cool, down to earth person in him. He —Gett Apostol is considered the father of his group, well sometimes the grandfather (you know EVANGELISTA, Jerome Trinidad what I mean), because of his witty remarks, “Jerome is not only one of the most active his excellent grasp of the topics being in the class, but he’s also very keen on discussed and his fatherly advice. Surely, details. His strong background in numbers he is one of the well-loved participants of fuels his curiosity especially when it comes SBEP 2016.” to very technical topics. But other than —Bob Aliggayu that, group presentations are so much fun with him because of his creativity! With FRANCISCO, Maria Theresa Jerome as a groupmate, presentations are Federico told in interesting and dramatic picture They say wherever we go, God gives stories—starring no less than SBEP us a “special angel”, one that will make groupmates in various funny roles! But our “passing through” moments and even in all the craziness of the presentations, experiences worthwhile. Thess Francisco they come out excellent as the ideas are is my “special angel” in SBEP Class of clearly communicated and contributed 2016. Simple, kindhearted and a very to the learnings in class. Jerome is truly a sweet soul in her own little way. Surprise memorable character of SBEP 2016!” Starbucks coffee jelly, Belgian chocolates, —Trisha Palacios ain’t she sweet? :) Though we come from indirectly competing organizations, FAJARDO, Joy Brigola such did not deter the budding of a very “Our groupmate who is very good at nice friendship in and out of SBEP. I am numbers”. so blessed to get to know her, up close —Dodo Ocampo and personal. Well, thanks to the SBEP Program and UA&P for this!” “Joy is an honest, reliable, hardworking, —Alen Gahite diligent and a very responsible person. He may be quiet but he has his own GAHITE, Marilyn Garcia sense of humor too. He is one of the “Ms. Alen is highly knowledgeable in her best accountants in our group. He has a field as an HR practitioner. I find her very very creative mind who practices out-of– intelligent and smart especially during the box thinking to come up with fresh session of classes. She is easy to be with solutions without sacrificing of course and can talk all matters under the sun.” our Accounting standards. That is why —Thess Francisco our bosses’ trust in him is very high. Congratulations, Joy, in completing GATUS, Romerico Quiroz Jr. SBEP! More power!” “Mr. Jon Gatus is a soft spoken —Vangie Atchioco businessman who is highly regarded in the waterproofing industry. He is easy and fun FLORECE, Bernardo Capil Jr. to be with and is very supportive in the “Sir Bernie is a serious-type of guy, but endeavors that this batch has undertaken. Looking forward to playing more golf with you!” —Allan Pua INCIONG, Elias Jose Maggay Bong has always been my attentive and participative seatmate in class. He shares his views in all subject matters and even questioned the business model of the organization that I am working with during the early part of the year. Since we became friends, I am now confident that he will defend our cause at all times.” —Ed Miano IRENEA, Teddy Altajeros What and How I can describe Mr. Teddy Irenea: Teddy is man of choice. A gift SBEP MAGAZINE 2016

OCAMPO, Rodelito Javillo “A conservative ideal leader and great mentor.” —Willy Toledo PALACIOS, Patricia Poco Trisha Palacios in one word is “Energy”. It was a delight and a privilege to work with Trish in Jakarta. She has this inspiring passion on everything that makes this learning journey in SBEP fruitful and fun! I wish her all the best and may her R-squared always be 1!” —Jerome Evangelista from God. 1) He is a very responsible son, taking care of the needs of his parents; 2) He is a dedicated family man; 3) He is a courteous, focused and humble employee with an exemplary record to beat; 4) He is God fearing, loving and friend of everyone. We love you Boss Teddy..” —Gerry Punzal LAPORE, Melanie Cecilia Siena “I am very honoured for the chance to write something about Melanie. But let me describe her not through her wit, but through her charms. Superb intellect is a given for a woman of her stature and output speaks louder than words. Besides, in this current time a leader’s wit is not enough. It is the leader’s charm that will get things done close, if not, to perfection and move the team to deliver beyond expectation. Very warm and generous with her ideas and resources, Melanie effortlessly engages the people around her. She was the tie that binds everyone to stay during the Christmas party, the person who made the homecoming a FUN night to remember (with a compelling press release to boot!), and the clever author who etched our Jakarta trip within our best memories. Warm. Generous. Engaging. Charming. Melanie Lapore.” —Mack Comandante LAZO, Macrina Pira A very dear, sweet, faithful classmate and friend. You will feel the warmth and energy of her person with her assuring calmness and peaceful presence. One is blessed to have been in her circle as she is determined to share God’s goodness and blessings in her. She is one pious, intelligent and smart lady. A true friend.” —Noemi Villaruz MANGUBAT, Eillen Barredo More than a classmate, Apples is a friend

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you ought to have...and a beautiful one indeed. Her beauty lies in her honesty and I admire her because of that. She calls a spade a spade—no gray areas. Apples is very caring, too. Oh, and she’s my best friend.” —Joel Cruz MIANO, Edward Cashi “Ed is a cool and helpful guy. Tough, too, because although he is always under some physical pain he still has a smile engraved on his face.” —Bong Inciong OBCENA, Romeo Soriano Jr. The first time I met Mr. Jun Obcena was in January of 2009 when I joined Leads Agri. He looks like a very serious person. Eventually he is really a serious person when it comes to his job. He is very dedicated and he always thinks of the company first. As our Vice President for Logistics, he always assures us in Sales that the product needed will be in the market at the start of the season. Basically, the Logistics and Sales Departments sometimes have some disagreements but at the end of the day, we will come up with the solution for the betterment of our company, and that’s because of Mr. Jun Obcena’s leadership. In my seven years working with him, we have established a very healthy and harmonious relationship being the lead of our own department. Mr. Jun Obcena is our “Logical Logistics Man”. Now we are more than colleagues. We are classmates, partner and more so, friends. —Mike Cantos

PEDRAGOSA, Caroline Grace Mandac Grace has an endearing and unassuming personality which can get her easily well with others in her own quiet way. I can see that she’s the type who thinks and listens more and talks less. She exudes confidence in her serenity and has the makings of an intuitive and compassionate leader. Congratulations Grace and continue to follow your dreams of serving the country through your entrepreneurship advocacy! GOD bless!“ —Bel Ambi PUA, Ronald Allan Formoso Mr. Allan Pua is a type of person who is open-minded, compassionate and levelheaded. He can always be counted on to listen and provide support when needed and also with a good sense of humor.” —Jon Gatus PUNZAL, Geronimo De Leon “GLP as fondly called in our company possesses the following attributes: 1) A God fearing person 2) A good family man and a good provider; he loves his family so much that he is more

Testimonials not afraid to speak his mind and to stand by his principles. But most of all, he has risen above his physical disability and proven to everyone that he can do anything any other person can. He is an excellent basketball and badminton player. As for me, on a personal level, he is a dear friend who I am not afraid to confide to and always provides a listening ear and a sound advice. He is also my fishing buddy, sharing hours and teaching me that fishing is the art of patience.” —John Quimbo stressed when one of the family members is sick. 3) A workaholic and an early riser and goes to work early ahead of his staff, a model boss to emulate 4) A generous man 5) A good mentor to his subordinates with emphasis on details 6) An authoritarian in a positive note--in the sense that what was committed should be completed on time.” —Teddy Irenea QUE, Conrad Yu Conrad Que is a very dedicated and responsible person both at work and as a father and husband. He crunches numbers and always takes the best viable options financially. He is passionate about information technology, sports cars, and gourmet food.” —Pat Rico QUIMBO, John Carlyle Dunque John, the ever-affable executive, carries with him plenty of experiences and wisdom in his arsenal that people around him can always relate. He talks sense, and he does it without the superfluous and highfaluting jargon. It is not surprising that he gets so popular and at the same time, easily earns the respect of his colleagues.” —Nove Rei Trapa

TOLEDO, Willy Sulit He gets along well with his colleagues.” —Dodo Ocampo “Willy is one of the more participative classmates that we have in SBEP 2016. He is very eager to learn new stuff and meet new friends. He is quite mysterious in his own ways—a smile that never leaves his face makes him approachable. A family man and a very good leader. He is instrumental in the success of the business he is handling now. Aiming to bring his company to a much greater height is his goal. You can never put a good man down—that is Willy Boy.” —Apples Mangubat TRAPA, Nove-Rei Flores Novie is one of the key personalities of the Fast Group of Companies especially in his role in Management Services; but he has always maintained a low profile, manifesting his humility. This does not mean that he is humble because he is weak. He possesses a keen analytical mind as well as depth and perspective in his work. This is the reason why all new and expansion projects of the group are coursed through him. He is also

VILLARUZ, Normita Lansang Noemi is admirable for the way she is able to juggle between her duties as managing partner of her own accounting firm, as wife, mother and grandmother to her family, as senior leader in her church community and as a student of SBEP. She is able to link all areas in her life as one integrated whole. She is generous in sharing her resources, including sharing the singing talent of her son during the alumni homecoming and her office resources for group projects. She is a lady worth emulating. I am lucky to have known her in SBEP but most specially, we in the Group 3 Projana Case are very lucky to have her in our group!” —Rina Lazo ZALAMEDA, Francisco Mayuga Jr. “Jun appears to be a very serious person on first encounter, but once you had the chance of knowing him better, you will be well-acquainted with his jolly and witty personality. He is diligent at work, dealing with all the projects of DMCI as the GM of Ready Mix Concrete Division. But above all of these, Jun strikes as a great family man, a husband and father that is devoted in ensuring the welfare of his loved ones.” —Jun Cammayo Jr.

RICO, Ma. Patricia Inciong Pat is a very dedicated and determined professional. In spite of her accomplishments, she is grounded and humble. Truly an asset to the organization she represents. She also loves to travel and is always ready to experience new things. A great person to share stories and ideas with!” —Conrad Que

SBEP MAGAZINE 2016

SBEP Alumni Association As a member of the SBEP Alumni Association, you are entitled to the following privileges: 1. 2. 3. 4. 5.

20% discount on all SBEP Financial Seminars Copy of the SBEP Annual Alumni Magazine (to be sent by mail) Unlimited access to the UA&P Graduate School Library SBEP Alumni ID card (to be sent by mail) Copy of the Market Call (to be sent by mail every quarter) – a publication of First Metro Investment Corporation (FMIC) and UA&P Capital Markets Research Group. This highly informative newsletter gives you the current standing and a thorough analysis of the workings of our macroeconomy and the capital markets.

For those interested to join, please submit the following requirements: – Accomplished Alumni Data Form – One (1) piece 1x1 picture (preferably white background) – Annual membership fee of PhP1,500.00 (check should be payable to the UA&P-SBEP Alumni Association, Inc.) For any SBEP Alumni concerns, please call our office at 6370912 to 28 loc. 222, 6343095 or email us at sbep@uap.asia

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Strategic Business Economics Program Your Executive Edge!

Alumni Get-together

SBEP

Kapihan

The SBEP Alumni Office is organizing a monthly Kapihan at UA&P. Since June 2016, the following Kapihan sessions have been realized: June 10 – “Investing in Bonds and Stocks” by Mr. Augusto Cosio July 29 – “Investment Management and Real Estate Alternatives” by Mr. Anton Hechanova September 30 – “The Application of Big Data Analytics” by Mr. Alberto Villa-Abrille October 21 – “New Trading Platform: Eco-Capacity Exchange” by Mr. Karl Leung November 16 – “Solar Power Evolution in the Philippines” by Dr. Reynaldo Casas December 7 – “Why Culture Counts” by Mr. Ramon Jimenez January 25, 2017 – “The Dual Training System and Corporate Social Responsibility” by Mr. Arnolfo Morfe and Mr. Crisanto Malaiba February 22 – “The Art of Storytelling for Business Executives” by Mr. Christian Vallez and Mr. Jonathan Guillermo The objective of the Kapihan is three-fold: 1) To bring back the SBEP alumni to UA&P • All alumni from Class 1975 to 2016 are encouraged to

attend the Kapihan. This will be a monthly breakfast reunion for the SBEP alumni and their guests. 2) To get first-hand updates on what’s happening in the economy and the business environment • An invited guest speaker will start the Kapihan with an informal / short briefing on pressing economic issues and their impact on the business sector. The attendees can freely join the interactive discussion while having breakfast and coffee. • UA&P economists, professors, alumni and distinguished guests from the government and private sector will be invited as speakers. 3) To provide a venue for networking with fellow senior executives on a monthly basis. • The SBEP boasts of its alumni (numbering 1,680+) from hundreds of companies, representing not only top corporations, but also medium-sized, dynamic enterprises, professionals (lawyers, doctors, engineers, etc.), and government officials including the police and military. The diversity and level of background of the alumni contribute to a truly enriching exchange of theory, experience, and wisdom. The invitation to the next Kapihan session will be sent to all alumni through email. The SBEP alumni may bring a guest(s) to the Kapihan. Registration is free. The only cost to the attendee is breakfast. For more inquiries on our monthly Kapihan, please get in touch with Ms. Tata Salazar, marketing and alumni affairs manager, or with Ms. Lea Riñon, marketing and alumni affairs coordinator, by email at sbep@uap.asia or by phone at 6342820 / 634-3095 / 637-0912 loc. 222. It’s time to be updated and re-connected! Be part of the SBEP-Alumni Loop! (by alonica r. salazar)

SBEP MAGAZINE 2016

Beyond Compliance

by Melanie Cecilia S. Lapore SBEP Class 2016

The SBEP-UA&P International Conference and Philippine-Indonesia Business Mission held in Pullman Hotel Thamrin, Jakarta, Indonesia from 20 to 25 April this year prove to be an efficient tool to have SBEP 2016 participants diligently focus on complying with Course Requirements. But more than the desire to comply, this crop of SBEP participantsâ&#x20AC;&#x201D; the weekday and weekend attendees finally togetherâ&#x20AC;&#x201D;enthusiastically immersed into the rudiments of capturing insights, of harnessing their collective desire to excel, and, of merging their professional experience and valuable learnings from nine months of hurdling the Course. This episode in Jakarta can be likened to a well-concocted topping of a satisfying meal that can be sweet, salty or spicy, depending on the time of the day or what is pleasurable at the moment. Succinctly, it was not bland at any one point. It was an experience that could make one burp for satisfaction, hum a crazy tune for the heart-stopping joy of camaraderie, or surrender to the energy of a wild spectrum of personalities. Each is a study in contrast yet so complementary in more ways than one.

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2016 Jakarta Trip decongestion. New and imposing buildings have risen that has altered the skyline of Jakarta. There is no doubt that infrastructure development is given impetus by the Indonesian government.

The Classroom Activities

The Choice of Jakarta, Indonesia

The country is steadily emerging into development. Its economy is on a roll and the composition of its population ensures a continuum of the current trajectory towards progress. Its political scene is colorful, the culture is diverse and the people are serviceoriented. Its topography counts multiple islands. The Philippines? No. Indonesia? Yes. The parallelism between Indonesia and the Philippines goes on and on. No doubt, there couldn’t be any better venue for the SBEP-UA&P International Conference 2016 than Jakarta, Indonesia! Once in Jakarta, we did not have to look too far or observe too closely to get the pulse of the city. Right infront of Pullman Hotel Thamrin, where we stayed, was a transport development that left only two lanes on both sides of Thamrin Road to commuters. Traffic could at times be bad, but surprisingly, not as bad as it sometimes is in Metro Manila’s EDSA. People walked, taxis stopped where they should, buses refuse passengers who hail them or want to get off at wrong points, while Grab and Uber operations are in full swing. Sunday is carless day specifically in the main roads of the city and how the locals, even tourists happily adapted to the situation! I couldn’t help but wonder, ‘will Manilans do the same in EDSA’? On the Sunday we were there, Thamrin Road was full of people, on their way to the church or the mosque, to the mall, to restaurants, to the park or to simply conquer this main street on a sunny day—the crowd that flocked made it look like a snippet from EDSA Revolution! The Indonesians are generally upbeat about the wave of developments happening in their midst. They are friendly, helpful and warm. And there is a pervading sense of pride among those whom we have met regarding the feverish developments happening in the country for the past couple of years. They are excited about the light rail transit system and the integrated road works underway. True enough, roads to and from the Soekarno-Hatta International Airport and around the city show signs of

Living up to the program’s objectives, lectures and presentations were the crux of activities for most of the first two days. These sessions revealed the participants’ level of orientation and understanding of the topics at hand. Like dutiful students, major discussions and pencil-pushing were undertaken by many of us even before leaving Manila. There were groups who pressed on getting it started early and having the presentations organized days before departure date. Come presentation day, both Project Analysis (Projana) and Business Ethics reports were incisive, creative and thoughtprovoking. Specifically for Projana, it helped that topics were tailorfit into the professional background of group members who easily gelled together. Dr. Rolando Dy’s insightful comments and clarificatory questions directed at each group after the presentations crystallized the merits of the reports. Business Ethics challenged our wisdom and value system. It was a study on one’s sensitivity to ethical issues one may encounter professionally. The situations were current and the solutions were timeless—for it was designed to drive the point that ethics is neither timebound nor trend-sensitive. Dr. Vic Abola nailed it in so many words and we got it: what is true remains true, what is right remains right.

The Philippine-Indonesia Business Mission To transition us from the classroom atmosphere into the world of actual business milieu, the Philippine-Indonesia Business Forum was held soon after. It was organized in partnership with the Philippine Business Club Indonesia (PBCI) and Philippine Embassy through the auspices of Ms. Alma F. Argayoso, Commercial Attache to Indonesia.

SBEP MAGAZINE 2016

The open forum and networking that followed was even more collaborative and enlightening as the local attendees and SBEP 2016 participants were able to spot opportunities and find new friends.

A Plant Visit and More

On the day of the Forum, a record-breaking number of businessmen and professionals from different industries came to interact with the SBEP 2016 participants. All forty-six (46) attendees and thirty-five (35) SBEP participants found an avenue to learn from each other and forge ties for future business alliances. The gathering took off with a welcome message by Her Excellency Maria Lumen B. Isleta, Philippine Ambassador to Indonesia. PBCI Founder and Chairman Mel Regalado dished out a talk on the Outlook of the Indonesian Economy, PBCI Professional Services Director Rudy Celeste spoke about Partnership Opportunities between Indonesian and Philippine Companies. And, to complete the investment and business angle of the event, Atty, Leah Olores, PBCI External Affairs Deputy Director gave a comprehensive talk on Legal Aspects of Doing Business in Indonesia.

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I would, if I could! That is, voting “oishi” to be part of the English dictionary over “kilig”, with a matching hand movement. P.T. Liwayway, the pioneering Filipino company, has crossed the seas and is now conquering markets outside the Philippine shores. From manufacturing Liwayway Gawgaw of long ago, the company ventured into concocting that all-time favorite snacks, called Oishi. It is common knowledge that P. T. Liwayway is successful in its Oishi product line locally and eventually embraced the challenge of going beyond Philippine shores by adapting to the taste of other countries it has penetrated. In Indonesia alone, it has launched variants like Suky Suky Seaweed Flavor, Kriuk Kriuk, Sponge Crunch with chocolate, strawberr y and cheese flavors, Caramel Popcorn, Durian

2016 Jakarta Trip Pillows, Spicy Prawn Crackers and the irresistible Rinbee. Its plant in Cikarang, Bekasi occupies a five-hectare area where Filipinos and Indonesians work hand in hand to produce the snacks that now flood the Indonesian market. What more, it is manned by young Filipino professionals whose bravado and cunning enable their brand and its products to gallantly compete. Needless to say, their youthful eagerness and charm fit right in. The plant visit was followed by a hearty Asian lunch at Krakatau Restaurant. From there, we proceeded to the Taman Mini Indonesia Miniature Park reminiscent of Philippines’ Nayong Pilipino. The afternoon rain quite marred the tour but indefatigable as many of us are, we quickly found our bearings once we got to the uppity Pacific Place for shopping. Sunday found many of us walking to the nearby St. Theresia Catholic Church to attend the Holy Mass in Bahasa. The rest of the day was spent in a tour of cultural places and more shopping in both more friendly-priced and highend malls. The movement of the participants, a few family members, the UA&P faculty and staff in and around Jakarta could have been a bore if it were not for our unbridled energy and the company of tour guides. The trips were opportunities to bond and likewise discover the talents of many—there were listeners as well as entertainers, one turns out to be a singer, a good number were tireless photo documentation specialists and a few were depository of either snacks, WiFi connection or wise cracks. The red bus had a tour guide who allowed the passengers to take naps in between by playing meditative music. In contrast, the blue bus was a wellspring of excitement with a politically-opinionated and hyper-active Surjadjaja Tanudiredja or Mr. Surja onboard. To wit, the unstoppable Mr. Surja, had an appropriate quotable quote: “Progress is a promise to those who work for it! Here in Indonesia, that is what even small people like me are doing.”

This out-of-the-country session effectively sets the tone for the forthcoming completion of SBEP. To a good measure, it caps our year-long journey of wanting to know more and better. It is both a discovery and a bold step out of our comfort zone where we allow ourselves to tread on not-so-familiar territories such as, taking exams, preparing reports and presenting our works to fellow participants and the faculty. Thanks to the able guidance of Program Director, Dr. Vic Abola and the persevering efficiency of Program Officer Rowena Arana and Ms. Viory Janeo. More than anything, the Jakarta episode substantiated the fact that learning is a complementation of classroom, boardroom and roaming adventure.

Additionally, it is worth mentioning that this Indonesia experience drives home the message that when you want a progressive country, you aim for a better economy with the government and the people working together. And as we reflect on the impact of our own contribution to the big picture, like it or not, deservedly or otherwise, each one is part of the campaign. There is no doubt SBEP 2016 has been taught how to do it right and to now be capable of doing it better within their own sphere of influence. Thanks, SBEP!

SBEP MAGAZINE 2016

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With almost a quarter of its student population receiving scholarship grants, the University of Asia & the Pacific is doing its part in providing high quality education to the Filipino youth regardless of the circumstances they face. Partnering with UA&P in this endeavor is an investment in our countryâ&#x20AC;&#x2122;s future. Join us in giving students from all walks of life the opportunity to rise above their constraints and meet their fullest potential. Give the gift that lasts. Help tomorrowâ&#x20AC;&#x2122;s leaders get started on their dreams.

CONTACT US Development Office 2nd floor ALB University of Asia and the Pacific Pearl Drive, Ortigas Center, Pasig City Landline: +632 637.0912 local 262 Mobile: +63 917.821.8784 Fax: +632 631.2174 E-mail: development.office@uap.asia

SBEP 2016