Of the additional capacity, 2,564.28 MW will be produced for Luzon; 486.57 MW for the Visayas; and 1,963 MW for Mindanao.

Coal-fired power plants domi-nate the list of power projects that will be commissioned, based on the latest data provided by the Department of Energy (DOE) as of June 30 this year.

The total capacity of the various coal power plants that will be put up

in Luzon, the Visayas and Mindanao is expected to reach 3,362 MW. The bulk, or 1,855 MW, will be in Mind-anao, followed by  Luzon, 1,237MW; and the Visayas, 270 MW. In Luzon the committed coal power projects targeted for com-mercial operation this year include the 2x150 MW of Southwest Luzon Power Generation Corp. in Batan-gas; the 135 MW of South Luzon

THE Greek people are voting on a future in which they face two painful prospects: the slow grind of years more of austerity cuts

or the country’s potentially catastrophic exit from the 19-nation euro zone. The question is whether their vote on Sunday can help them escape either. “Yes” to more budget cuts demanded by credi-tors in exchange for a financial-aid package for the country? Or reject it in the hope it will not lead the country out of the euro? For the radical left-led Greek government, the proposals are unacceptable. It’s urging a “No” vote and says that will have no impact on Greece’s euro status. Proponents of a “Yes” vote, including a parade of former prime ministers and the main opposi-tion party, say backing the government will jeopar-dize Greece’s place in the euro. Instead, they argue that by voting “Yes,” Greece would get a new deal quickly to shore up the economy.

www.businessmirror.com.ph �Saturday 18, 2014 Vol. 10 No. 40 P. | | 7 DAYS A WEEK�Monday, July 6, 2015 Vol. 10 No. 270

A broader look at today’s businessBusinessMirrorBusinessMirrorTHREETIME

ROTARY CLUB OF MANILA JOURNALISM AWARDEE2006, 2010, 2012U.N. MEDIA AWARD 2008

ROTARY CLUB

JOURNALISM

C AC A

C A

PESO EXCHANGE RATES US 45.1630 JAPAN 0.3669 UK 70.4949 HK 5.8270 CHINA 7.2786 SINGAPORE 33.5087 AUSTRALIA 34.4782 EU 50.0677 SAUDI ARABIA 12.0435 Source: BSP (3 July 2015)

49 power projects ready by 2019PHL TO HAVE 5,000 MW OF ADDITIONAL POWERGENERATION CAPACITY, BUT FUEL MIX STILL NOT IDEAL

INSIDE

ribbon and various beads; and when Anita Magsaysay-Ho can in�uence an entire collection of wool-blend suiting and cotton sateen.

Musings with the Muses is exhibited alongside Access, a series of photographs by supermodel-photographer Jo Ann Bitagcol, which were directly inspired by Lloren’s 40th piece which he calls Pananaw, a dress he created as his reaction to the other 39 artist-inspired pieces. “It was the choice of the curator, my friend Albert Avellena [of Avellana Art Gallery], to have my own piece as the inspiration. He said, ‘We couldn’t put, say, Arturo Luz—because people would then ask: Why Arturo Luz? Why not some other artist? So it’s better that it would be Jojie’s piece,’” Lloren explained.

Bitagcol is presently in New York to pursue photography assignments and further studies in the visual arts. �e wai�sh supermodel has served as Lloren’s muse for the longest time and she photographed the fashion editorials that accompany the exhibit. “I approached Jo Ann to do the photographs, with models like Grace Tagle and Monika Sta. Maria. We had the pictorials a few months ago because we planned to do a book about the collection,” Lloren said at the exhibit’s opening, then demurring, “I can’t say that I’m publishing the book, or that we have a publisher already. Initially, we planned that the book will be launched tonight. But then we had a meeting and we thought: Why don’t we make this more beautiful and not rush the making of the book?”

Lloren said the proceeds of the upcoming book will go to the CCP and the Clothing Technology department of the University of the Philippines (UP), of which he’s an alumnus. “We won’t earn anything from the book, with the last centavo of the net proceeds to be divided between the CCP and UP,” he promises.

So, will the couture creations gain greater value because they have been exhibited at the CCP?

“Well, you know, people here have a di�erent mindset. �ey’d just say, ‘But why? �ey’ve been used already!’”

FASHION designers are being accorded signi�cance by major museums around the world. Guo Pei, Anna Sui and Vivienne Tam are featured in China: �rough the Looking Glassuntil September 7 at the Metropolitan Museum

of Art in New York; �e Fashion World of Jean Paul Gaultier: From the Sidewalk to the Catwalk runs until August 3 at the Grand Palais in Paris; and Alexander McQueen: Savage Beauty will be on view until August 2 at the Victoria and Albert Museum in London.

If you don’t have the time and the means to satiate your fashion �x from the aforementioned exhibits, your next best resort is a visit to the Cultural Center of the Philippines (CCP) to view Jesus Lloren: Musings with the Muses. Filipino haute couture at its �nest will be on display until July 20 at the Bulwagang Fernando Amorsolo and Pasilyo Victorio Edades.

Musings features Lloren’s 2014 Red Charity Gala 40-piece collection, where he paid tribute to Filipino visual artists from Juan Luna to Charlie Co. A few days after the October gala, the CCP called Lloren and asked if it could exhibit his clothes. �e designer readily agreed.

If my erratic memory serves me right, Lloren is only the third homegrown designer given such importance by a venerable art institution, after Joe Salazar was feted in the Timeless Terno exhibit at the Metropolitan Museum of Manila in 2003, and Salvacion Lim Higgins was given a tribute, SLIM: Salvacion Lim Higgins, Philippine Haute Couture 1947-1990, at the Museum of the Filipino People, National Museum of the Philippines, in 2009.

I can only surmise that Musings is the CCP’s subtle way to “introduce” the masters of Philippine visual arts to a younger generation more concerned with Instagram �lters, Tumblr posts and Facebook feeds. �e clever move can be e�ective, especially when visitors engage in a deeper discussion as to how, for instance, Lee Aguinaldo’s Linear 95 (1969) inspired Lloren to create a column gown made of raw silk suiting, silk dupioni and silk crepe.

Fashion students who fancy themselves as artists can have a �eld day identifying which Vicente Manansala artwork informed Lloren’s piece made of duchesse satin, silk dupioni, linen, silk shantung and faile; or how Lloren reinterpreted Romulo Olazo’s Diapanous-Tulip into a silk twill, piña creation; or why Ang Kiukok’s Fruit on Table(1975) became a sexy number of stretch crepe, grosgrain

Life Life Life D1

Life BusinessMirror

Life Life EXPLORING GOD’S WORD, FR. SAL PUTZU, SDB AND LOUIE M. LAC Life M. LAC Life Life SON Life Word&Life Publications • teacherlouie1965@yahoo.com Life teacherlouie1965@yahoo.com Life The power of the spirit

DEAR Lord, it is in the spirit of love and joy that all the holiness of God dwells in us with its transforming,

sublimating effects. Thanks to God, the poverty and frailty of our human nature can surge to unprecedented degrees of sanctity and heroism. In the power of the spirit, our heart can learn to love and rejoice as God does, and the barrenness of our person can become the most splendid cathedral, which no Life person can become the most splendid cathedral, which no Life human architect can construct. May the power of the spirit Life architect can construct. May the power of the spirit Life reign in us all the days of our life. Amen.

• lifestylebusinessmirror@gmail.com

Life • lifestylebusinessmirror@gmail.com

Life Editor: Gerard S. Ramos

Life Life Life Life Life Life Life ALL ACCESS:LEADING MEN»D3

Monday, July 6, 2015

❶ ROBERTO CHABET, Felix Resurrecion TO CHABET, Felix Resurrecion TO CHABET Hidalgo, Ivy Avellana-Cosio, Victorio Edades, Federico Alcuaz, Arturo Luz, HR Ocampo.

PHOTOS BY MISS CHARLIZE

➋ PACITA ABAD, C. Valdezco, Geraldine Javier

➌ ACCESS, a series of photographs by Jo Ann Bitagcol

➍ ROMULO OLAZO

➎ CARLOS FRANCISCO (yellow), Alfonso Ossorio (blue) and Vicente Manansala (gray)

➏ PAPAP NANAN NANAN W, Jesus LlorenW, Jesus LlorenW

Restrained ‘Musings’Restrained ‘Musings’

❶ ❷ ❸

❹ ❺ ❻

JESUS “JOJIE” LLOREN

www.businessmirror.com.ph Monday, July 6, 2015BusinessMirror E 1

© 2013 Harvard Business School Publishing Corp. (Distributed by �e New York Times Syndicate)

B M A. C

WE’RE on the verge of a major upheaval in how inventory is managed. is

revolution springs from the availability of huge amounts of real-time data now generated on the Internet, and through the interconnected world of enterprise software systems and smart products. To use this new data effectively and stay competitive, managers need to redesign their supply-chain process.

INVENTORY MANAGEMINVENTORY MANAGEMINVENTORY MANAGE ENT IN THE AGE OF BIG DATA

Inventory management must go beyond traditional historical data on sales and stock-outs. It’s now possible to link data from all product interac-tions (including orders and customer reviews), as well as transactions by suppliers and competitors who con-nect via web sites and cloud portals. With this data, inventory manage-ment can control product ordering and distribution throughout a com-pany’s extended supply chain.

How does this work?ALGORITHMS can exploit pat-terns and relationships among data elements and supply-chain decisions—e.g., when to order widgets, how many and where to put them. Then the whole process can be evaluated to see if these data-driven tools lower cost and/or enhance customer service.

Why does this matter?INTELLIGENT systems, supple-mented by management input, can find the best relationship between all possible decisions and all avail-able data. Thus, performance can dramatically improve. For example, smart, connected products generate vast amounts of data about current

operating conditions and real-time performance. Such information, along with traditional historical sales-based data, can support better methods for product maintenance and replacement. This approach extends the concept of prescriptive analytics, considered by many to be the ultimate use of big data. Prescrip-tive analytics, however, has so far eluded most big-data users—with some notable exceptions in indus-tries, such as online apparel retailing, where companies can view real-time, customer-purchase decisions (e.g., to buy or not to buy) and, thus, change prices frequently, at a negligible cost. The world of inventory man-agement is changing, and compa-nies that embrace this change will be ahead of the game. Making the most of the new intelligent systems requires involvement of multiple functions within the company; a high level of coordination both upstream and downstream among supply-chain partners; and signifi-cant engagement with customers.

Morris A. Cohen is the Panasonic Profes-sor of Manufacturing and Logistics at the University of Pennsylvania’s Wharton School and co-founder of MCA Solutions.

B W F

WHAT does a for-profit company gain by invest-ing in social or environ-

mental responsibility? One answer is reputation. Customers may react more positively to a socially respon-sible firm; so might potential hires.

But, a new paper suggests that customers and employees aren’t the only ones influenced by corporate social responsibility. Regulators notice it, too.

Princeton economists Harrison Hong and Inessa Liskovich stud-ied federal fines for US companies bribing foreign governments. The research showed that the more so-cially responsible was the company

at fault, the lower the fine. The economists looked at violations of the Foreign Corrupt Practices Act from 1990 to 2013, as well as the fines that were levied. Then they compared that data to violators’ social responsibility scores, from a widely used index that assesses things such as community rela-tions, environmental impact and how a firm treats its employees.

A relatively small difference in social responsibility—the equiva-lent of a strong employee retire-ment program versus an average one—was associated with $2 mil-lion less in fines.

The researchers ruled out a number of possible ex plana-tions: For instance, it wasn’t that

bribes by socially responsible firms were smaller, or that those f irms were more cooperative with investigators. Community relations, responsible products and good employee relations were most associated with lower fines.

“One implication of our analysis is that firms might very well have a strategic motive to be socially responsible as a form of insurance in case of unfavorable regulation,” the researchers concluded.

That’s the cynical take: Firms invest in corporate social responsi-bility to appear more virtuous than they actually are. The more opti-mistic take is that the researchers set out to see whether people—in this case regulators—are more

positively inclined toward respon-sible firms. And they’re not the first to find that the answer is yes.

If the link between regulatory scrutiny and social responsibil-ity is real, that’s problematic, and should be addressed. But it doesn’t change the fact that a company’s reputation is im-proved by investing in social and environmental responsibility. If even regulators in the middle of bribery investigations perceive companies differently because of corporate social responsibil-ity, think of what it could do for customers and employees.

Walter Frick is a senior associate editor at Harvard Business Review.

Do regulators go easy on socially responsible firms?

The history and future of operationsB M I

I T’S time to rethink what we mean when we talk about “op-erations.” Operations is not only

about manufacturing. Operations gives an organization the power to act: to create value for its custom-ers, to capture value for its share-holders and to share value with its ecosystem. In the era of ubiquitous digital technologies, operations empowers an increasing variety of organizations—ever more modular, connected and distributed, and ever more centered on software and data.

From its earliest days, digital technology has enabled opera-tions. From the first commercial IBM mainframes in the late 1950s, computers have driven increasing efficiency in manufacturing and

service institutions. Whether we optimize forecasts through opera-tions research at Nike, or order in-ventory through Toyota’s Kanban Toyota’s Kanban Tsystem, operating capabilities hinge on managing and optimizing digi-tized information. So what’s differ-ent now? The exploding range of ap-plications in Web services, mobile, and the Internet of Things means that the development and delivery of software services is transforming the very fabric of our business and operating environments.

Whether you’re designing the new Ford Mustang, a new financial investment product or the next ver-sion of Snapchat, the bulk of an or-ganization’s operating capabilities is software-based. So the design, man-agement and deployment of soft-ware have become central to a firm’s

operating model. Digital technology is also enabling completely new operating models that are increas-ingly open, distributed, and shared across thousands of organizations and individual contributors. These new models have enabled close to 9 million independent developers to contribute apps to the iOS and Android mobile platforms. They’ve enabled WhatsApp to grow to more than 450,000 users with fewer than 30 employees.

Thus the design of develop-ment tools, advance programing interfaces or the user onboarding process for a mobile application has become as important to operating excellence as production planning or inventory theory.

And yet, traditional notions of operations strategy and supply

chain management are more cru-cial than ever. In a huge ecosystem of companies, for example, supply chain management has become increasingly critical to data center infrastructure. Digital technology becomes more ubiquitous as the traditional analog and digital worlds merge. Not only do old firms need to understand relatively new digital technology. Relatively new firms (Microsoft, Google and Amazon) need to master traditional operat-ing concepts.

So let’s not equate the field of operations only with manufactur-ing. Silicon Valley also needs the power to act.

Marco Iansiti is the David Sarnoff Profes-sor of Business Administration at Harvard Business School in Boston.

B A C. E

‘LOOK to your left, look to your right: One of you won’t be here next year.”

This intimidating line was immor-talized as a greeting for incoming Harvard Law School students in the classic movie, The Paper Chase. The explicit (and intended) mes-sage is that hard work is necessary to be successful. The implicit (and perhaps unintended) message is that your success occurs when others fail. Clearly, this message inhibits teamwork.

It’s hard to collaborate if con-sciously, or not, you view your colleagues as the competition. Even when leaders don’t explicit-ly create a win-lose environment, the competitive mind-set is the default for most high-achieving professionals. In every indus-try, those hired by elite organiza-tions have competed in endless small contests along the way to achieve these positions. So suc-cess is viewed as a zero-sum game where my success depends in part on your failure. And that doesn’t breed team spirit.

The challenge for leaders is to help smart, talented people change their mindset from competitive to collaborative. The message must be that success can be greater and more exciting when people work together. Here are three tactics leaders can use:n Model the behavior you’re

hoping to inspire. For example, demonstrate curiosity and inter-est in your colleagues. Ask them genuine questions and respond thoughtfully to what you hear.n Reward successful team-

work more t han ind iv idua l performance.n Frame the challenge ahead

(the work, the initiative, the proj-ect) as something that needs di-verse perspectives and skills.

With persistence and patience, leaders can help their teams compete together to reach the most impor-tant goal—serving the customer.

Amy C. Edmondson is the Novartis Professor of Leadership and Manage-ment at Harvard Business School and author of Teaming: How Organiza-tions Learn, Innovate and Compete in the Knowledge Economy.

GET RID OF UNHEALTHY COMPETITION ON YOYOY URTEAM

AGE OF BAGE OF BA IGE OF BIGE OF BG DATAIG DATAI

BusinessMirrorPerspective

Monday, July 6, 2015E4

His son, Nikolas, is on his side—and he thinks polarized Greece may be on the verge of a civil war—while his wife Dimi-tra distrusts both the Yes and the No cam-paigns and doesn’t plan to vote in Sunday’s momentous Greek referendum. Meet the Danikoglous, an intense, ar-ticulate Greek family divided over whether or not the country should accept conditions by creditors attached to loans it needs to avoid default and a banking collapse. � e ballot question does not address whether Greece should abandon the euro currency or leave the 28-member European Union, but many voters believe those is-sues are at stake. In their apartment in the working-class Athens neighborhood of Tavros, the family members squabble over espresso frappes and fruit juice. But they don’t � ght. � ey are united in their belief that only as a strong family can they weather the coming storm. And they share a sense that Greece, so rich with history and culture, has fallen tragically short of its potential. Here are their views:

■ DIMITRIS DANIKOGLOU, 48, works in the family jewelry shop: “I am forced to vote for ‘yes’ because I want to stay in the eurozone and the EU. I can’t imagine Greece out of Europe and I don’t believe that if we say ‘no’ we can stay. I can’t take that risk. We are under the pro-tective umbrella of the EU, a big protective social system, and we need protection. And we have to stay for political and economic reasons.”

“I have a shop of my own; my pro� ts are down 50 percent in the last � ve years of austerity. � e return to the drachma would be a catastrophe for me, and for the whole country. � e politicians are not tell-ing the truth about a return to the drachma [Greek’s former national currency]. Many believe we will open the currency factory and make drachmas for everyone and pay o� the debt with drachmas. But there would be a sudden bankruptcy.” “Europe has made big problems for us. � e debt is not right, it’s not payable. I agree it should be cut 30 percent. I’m struggling for the survival of my family. It’s very hard. We live in di� cult times.”

■ ALEXANDRA DANIKOGLOU, 20, is studying philosophy at university: “I’m afraid for my future. I see people � red every day. I worry because I see people starving outside on the road. It’s scary. All my classmates from high school have left for England or America. Nobody stays in Greece. But we are Greek, we should stay. But how can I say I will � nd a job?” “I will vote ‘no’ on Sunday. It’s terror to go out of the eurozone. But I want to do something di� erent, I want to resist. � is is my resistance. I don’t want all these big countries controlling us.” “People say Greece is special, because it is the mother of philosophy, of mathemat-ics, of politics, of democracy, and so what? What are we doing? We keep talking about our history but we are doing nothing. Right now we are not good enough to be called Greek. We need to progress. I know it will

A FAMILY DIVIDED Emotions run high ahead of Greek vote

B G K | � e Associated Press

ATHENS, Greece—Dimitris is voting “Yes” because he fears Greece would be in danger if it leaves the European

Union. His daughter Alexandra is voting “No” because she is tired of richer European nations bossing Greece around.

SUPPORTERS of the “No” vote hang a banner reading in Greek and English “No to austerity and fear,” referring to the upcoming referendum, atop of Lycabettus hill in Athens on Thursday. ANTONIS NIKOLOPOULOS/EUROKINISSI VIA AP

www.businessmirror.com.ph

be very di� cult if we leave the eurozone and go back to the drachma, but I see hope in the situation. If we stay in the eurozone I don’t see hope. � ey will control us for 20 years.”

■ NIKOLAS DANIKOGLOU, 23, training for a career in law: “I feel the tension at work, tension in the streets, tension in the cafés. � e people are arguing the whole time. I’m afraid of the cur-rent situation. I’m fearful. I really am.”

“I have no idea about the future. I am voting ‘yes’ because I want a discussion with Europe. � e next day if possible. If ‘no’ comes, I’m afraid there will be no discus-sion, or the terms will be worse than what was o� ered before.” “� is situation will create a war within the people. Greek versus Greek. � e people

are divided right now, about 50-50. What hap-pens the day after the ref-erendum? I’m afraid.”

■ DIMITRA DANIKOGLOU, 48, works in the family jewelry shop: “I want to stay in the European Union, but I won’t vote ‘yes’ because I don’t trust the political parties that are in favor of that, because they are the ones who caused the cri-sis. I don’t trust the par-ties saying ‘no’. I feel the same way about them.” “I’m afraid of ‘yes’; I’m afraid of ‘no.’ I am not go-ing to vote tomorrow be-cause I think either ‘yes’ or ‘no’ is like someone tell me how I’m going to die.” “I’m furious about the propaganda in the

media. I’m from a di� erent generation. I worked since I was a little girl and I did not have the chance to study. I try to un-derstand what’s going on with the econo-my by listening to the TV and radio. � is problem came from the former govern-ment. I’m ashamed I voted for them over the years.”

Thousands of Greeks lined up to withdraw euros from ATMs Monday, as restrictions on money withdrawals and banking transactions went into effect to keep its financial system from collapsing.

Eurozone

• Banks will remain closed from Monday until at least July 6

• Cash withdrawals from ATMs will have a daily limit of 60 euros ($67) per card

• Credit and debit card transactions within the country will not be limited

• Internet and phone banking within the country will have no restrictions

• Foreign bank cards, whether debit or credit, will not be affected. Tourists will be able to withdraw the full amounts their own banks allow them to.

Source: AP, Open EuropeGraphic: Staff, Tribune News Service

Who does Greece owe?Total debt: 323 billion euros

60%

International Monetary Fund

10%

European Central Bank

6%

Greek banks3%Foreign banks1%Bank of Greece1%Other bonds15%Other loans3%

Greece bank restrictions

ALEXANDRA DANIKOGLOU, 20, speaks as E� Georgiou (right) and her daughter Maria Georgiou listen at an apartment in Athens. AP/SPYROS TSAKIRIS

DIMITRA DANIKOGLOU, 48, gestures as she talks next to her son Nikolas, 23, at their apartment in Athens. AP/SPYROS TSAKIRIS

DIMITRIS DANIKOGLOU, 48, speaks during an interview at his apartment in Athens. AP/SPYROS TSAKIRIS

PERSPECTIVE E4

RESTRAINED ‘MUSINGS’

AGE OF BIG DATA

THE GREEK VOTE

LIFE D1

MONDAY MORNING E1

COA: MMDA partly to blame for flooding

B D C

First of two parts

WITH the onset of the rainy season, flooding in Metro Manila remains one of the

biggest problems in the metropolis, and residents again are hoping that the Metropolitan Manila Develop-ment Authority (MMDA) would be up to the task in solving this prob-lem before this administration ends. But a good track record of the MMDA on this issue is wanting, with previous reports from the Commission on Audit (COA) show-ing inefficiencies in the planning, procurement and rehabilitation of

flood-control projects needed in Metro Manila. In the last two COA reports on the efficiency of the expenditures and implementation of the projects by the MMDA, it was noted that the agency had not been very efficient in implementing flood-control projects. The inefficiency is shown in ei-ther the delays in the completion of the projects, which prevented such projects from providing timely relief during the rainy season; or in the lack of planning and coordination in the implementation of infrastructure projects, which resulted in wastage of government money.

GREECE VOTE: 2 CHOICES,MANY POSSIBLE RESULTS

To prevent another run on euro deposits in Greece’s crippled financial system, a weeklong bank closure began Monday, and residents were limited to 60 euros, about $66, in cash withdrawals from ATMs per day. Here is a look at declining euro deposits over the years in Greek banks.

Billion euros

Source: AP, Bank of GreeceGraphic: Staff, Tribune News Service

Amount in banks from households and private corporations

Greece’s bank deposits

$228.8

$129.9

Declining deposits

100

150

200

$250

Jan. 2009 May 2015

A PROTESTER drapes a Greek flag around her shoulders during a pro-European Union demonstration at Agia Sofia Square in Thessaloniki, Greece, on Thursday.

KONSTANTINOS TSAKALIDIS/BLOOMBERG

B L L

THE country is assured of over 5,000 megawatts (MW) of additional power-generation

capacity from 49 power projects that the private sector has committed for commercial operation anytime starting this year until 2019.

SPECIAL REPORT

news@businessmirror.com.ph BusinessMirrorMonday, July 6, 2015 A2

BMReports In 2012, for instance, the COA observed in its annual audit report for that year that flood-control projects did not serve the purpose for which they were funded by the government because of inefficient implementation and inadequate planning by the MMDA. In that year, a big chunk, or 83.5 per-cent, of the flood-control projects were completed only in the third and fourth quarters of the year, long after the rainy season had begun, during which these projects were most needed. “Of the 49 proposed flood-control proj-ects in 2012, a total of 41, or 83.47 percent, costing P224 million of the P322-million budget, were completed only in the third and fourth quarters of 2012 and January

2013, as procurement activities were un-dertaken in the second and third quarters of the year, thereby defeating the intent of mitigating, or preventing, the impact of the heavy rains to the public at large to which these projects could have served their purpose,” the COA Annual Audit Re-port for 2012 said. In response to the delayed implementa-tion of the flood-control projects in 2012, the COA recommended that the MMDA should “revisit its strategies and practices in the implementation of flood-control projects, given that time is of the essence vis-à-vis the weather patterns of the Philippines.” However, during the following year, the COA observed in its follow-up activities on its recommendation that there were still

more than 50 percent of approved flood-control projects that were not delivered on time. In the COA’s audit report for 2013, the commission said that when it followed up the recommendations on the flood-control projects the previous year, it was found that the MMDA only partially complied with such recommendations, resulting in another delayed implementation of these vital undertakings during the rainy season, when they are needed most. “For projects undertaken in 2013, 30 of 62, or 48.40 percent, of the projects funded under the General Appropriations Act were still not delivered before the onset of the rainy season,” the Part III of the COA An-nual Audit Report in 2013 said. To be concluded

COA: MMDA partly to blame for flooding. . . Continued from A1

FILE P

HOTO

news@businessmirror.com.ph Editor: Dionisio L. Pelayo • Monday, July 6, 2015 A3BusinessMirrorThe Nation

The PNP on July 5 said police operations from January to May have “neutralized” a total number of 17,098 persons wanted for several crimes. The PNP added that authorities also “accounted” for a total number of 4,473 firearms and weapons.

Authorities said neutralization efforts led to the arrest of 16,917, the death of 66 and surren-der of 115 persons wanted for various criminal offenses. Of the total people arrested, eight car-ried monetary rewards on their heads.

PNP Spokesman Chief Supt. Wilben Mayor was quoted in a statement as saying that the significant accomplishment of the campaign against wanted person was the killing in January of international terrorist Zulkifli bin Hir, alias Marwan, in Baran-gay Pidsawan, Mamasapano, Maguindanao.

The slaying of Marwan followed the death of 44 members of the PNP-Special Action Force in a botched police operation in Mamasapano on Janu-ary 25. Investigations into the failed fatal police operation led to the resignation in February of Purisima, who was ordered dismissed on June 30, or five months before his retirement in November.

Mayor, however, credited the agency’s accom-plishments during the first five months of the year to Purisima’s replacement, PNP Officer in Charge Deputy Director General Leonardo Espina. Espina is retiring in mid-July.

“The PNP sustained its program in anticrimi-nality operations to keep the communities safer by deploying more uniformed personnel to carry out focused police operations. Patrolling and presence of the police officers assure law-abiding citizens of their safety from any criminal elements,” Mayor quoted Espina as saying.

On the campaign against loose firearms, the PNP said it was able to confiscate 3,193 firearms (about 21 a day in the first 151 days of the year) for violation of Republic Act 10591 (Comprehen-sive Firearms Law). The PNP added that about 734 firearms were recovered, while 546 were surren-dered. In line with these, a total of 3,286 persons were arrested and 2,230 cases were filed in courts, according to the PNP.

Meanwhile, operations against organized crime group resulted in the disbandment of 33 gangs and arrest of 417 gang members, recovery of 177 assorted firearms and the filing of 215 cases in courts.

Mayor said Espina credited the arrests and con-fiscation of firearms to “intensified police presence on streets and anticriminality campaigns, with the primary goal of reducing crime and improv-ing public safety.”

Mayor added that the anticrime campaign will be implemented in other PNP regional offices around the country.

PNP cites progress against criminalityBy Rene Acosta

FIVE days after Ombudsman Conchita Carpio-

Morales dismissed former Philippine National Police (PNP) Chief Alan LM Purisima and 10 other PNP officials for entering into an anomalous contract, the PNP reported accomplishments against criminality.

PRESIDENT Aquino is continuously monitoring the impact of Tropical Storm Egay (international code name Linfa), even as the government strives to attain its zero-casualty target

in the latest weather disturbance to hit the country.This was reported over state-run radio early Sunday by Com-

munications Secretary Herminio B. Coloma Jr.Coloma added that concerned government agencies, led by Ex-

ecutive Director Alexander Pama of the National Disaster Risk Reduction and Management Council (NDRRMC), have also taken steps to ensure the safety of residents in the path of Egay that made landfall over the weekend.

Coloma said Mr. Aquino reiterated earlier Palace directives for the NDRRMC and other agencies to exert extra efforts to keep people out of harm’s way in areas affected by the typhoon.

In Filipino, Coloma urged government agencies to ensure the safety and welfare of citizens in areas affected by the storm. He added that the objective is still to have no casualty because of the storm.

Just before noon on Sunday, Coloma reported over government radio station that latest reports from the NDRRMC indicated that Typhoon Egay was monitored in the vicinity of Divilacan, Isabela, and was headed in the direction of Aparri, Cagayan; and Basco, Batanes.

“Nakataas pa rin ang Signal No. 2 sa mga lalawigan ng Kalinga Apayao, Isabela, Quirino, Hilagang Aurora, Cagayan, kabilang na ang mga kapuluan ng Babuyan at Calayan,” Coloma said.

State-run Philippines News Agency (PNA) reported late Sunday that the Department of Social Welfare and Development (DSWD) has prepositioned relief assistance in areas along the path of the storm in Northern Luzon.

Quoting Social Welfare Secretary Corazon J. Soliman, the PNA said the DSWD has prepositioned relief aid, which is consist of 288,540 food packs, as a ready augmentation to the assistance that will be distributed by the local government unit that may be affected by the weather disturbance. Butch Fernandez

Palace monitoring typhoon

CHIEF Justice Ma. Lourdes Sereno disclosed last week plans to transfer the Supreme Court (SC) to a state-of-the-art building situated at the Bonifacio Global City (BGC) in Taguig by 2019.

Sereno told reporters in an interview the High Court is already in the pro-cess of acquiring the land where the building will rise.

Sereno added the SC has already found a property in the BGC after secur-ing the needed funding from the Department of Budget and Management.

“We were already issued a certificate of disaster clearance that the side [of the land] is not within the [West Valley] fault area,” she said.

Sereno was referring to a 21,000-square-meter lot in Fort Bonifacio worth P1.28 billion, payable in 10 years, with an annual amortization of P128 million.

“[The project] is at the stage now where we are asking money for the building itself because the government has already agreed to fund the ac-quisition of the land,” Sereno said.

With the approval of the budget and if the plan will proceed without any problem, she expects the project to be finished in 2019.

“Modern construction timetable will enable us to have a building in three to four years—assuming that there is no major hitch. Hopefully in about four years or an allowance of up to five years, we will have our own building,” she said.

The land where the SC, the Department of Justice and the Court of Ap-ppeals buildings currently stand belongs to the University of the Philippines.

“We should really have a land in the name of the court and a building that is modern, disaster-resilient, technology-enabled, and that will stand as the symbol of the Filipino sense of justice,” Sereno pointed out.

Top architect and urban planner Felino Palafox Jr. is being considered to lead the construction of the proposed building and compound. Joel R. San Juan

CJ Sereno eyes SC’s transfer to Taguig

AN attack allegedly by commu-nist rebels on Saturday night damaged a light Cessna plane

owned by pineapple and banana com-pany Dole Philippines Inc. in Compos-tela Valley, military officials said.

First Lt. Vergel Lacambra, public af-fairs officer of the Philippine Army’s 10th Infantry Division, said two explosions caused by homemade bombs were be-lieved to have been detonated by the New People’s Army (NPA), the armed wing of the Communist Party of the Philippines. Lacambra said the explosions rocked the

hangar of Dole in Maragusan, Compos-tela Valley, at around 11 p.m. on July 4.

He said the company’s security offi-cer reported that the explosion occurred at the bridge leading to the entrance of the hangar airstrip causing minor damage to the aircraft. Lacambra said no one was reported injured from the blast. He said the explosion damaged a parked Cessna plane that Dole Philip-pines had been using to spray pesticides on its banana plantation.

Elements of the 25th Infantry Bat-talion have launched pursuit operations

against the perpetrators believed to be from the NPA’s Front 27, according to Lacambra. “Extortion from the NPA is seen to be the motive behind this incident,” he quoted Lt. Col. Michele Anayron, commander of 25th Infantry Battalion, as saying.

Major General Eduardo Año, com-mander of the 10th Infantry Division, condemned the attack and has ordered ground units to intensify close coordina-tion with local government officials, local police stations and company security of-ficers. Rene Acosta

Military says NPA attack damaged Dole PHL plane

Drivers of bicycles with covered sidecars weave between pedestrians along a street in Manila in the morning of July 5 during a downpour brought by Tropical storm egay (international code name Linfa). To the street’s east lies the office of President Aquino, who, Communications secretary Herminio B. Coloma Jr. said, is monitoring the impact of the storm as the government wants no casualty in its wake. Roy DoMInGo

By David Cagahastian

Debt servicing made by the government as of April this year continued its uptick, with January to April debt payments amounting

to P262.01 billion, or a 13-percent increase from debt payments made during the same period last year. For January to April the government’s debt serv-icing was P30.06 billion higher than debt payments made during the same period in 2014, which amounted to P231.95 billion. Debt servicing is the sum of the amortizations made on the principal debt and the interest payments made on that principal debt. As in previous months this year, the amortization on the principal debt accounted for the increase in debt payments. From January to April, amortization on the prin-cipal debt amounted to P145.72 billion, or 26 percent

higher than the P115.42-billion amortization made last year. Interest payments from January to April this year amounted to almost the same as the interest payments made on government loans for the same period last year. Interest payments amounted to P116.29 billion from January to April, slightly lower than the P116.53-billion payments made last year. the ratio of the government’s interest payments in relation to total expenditures, however, continued to decline. Interest payments of P116.29 billion for January to April 2015 constituted only 17.6 percent of total expenditures, which amounted to P660.55 billion. For the same period in 2014, interest payments of P116.53 billion constituted 18.6 percent of the total ex-penditures of P626.13 billion, or a full-percentage-point drop in the interest payments to expenditures ratio.

BusinessMirror news@businessmirror.com.ph A4

Economy

“We are counting on Greek trading ships, which are earning quite a lot

in US dollars, to stay afloat. They are fairly insulated from the Greek

government’s extreme financial distress,” the former senator said.

energy experts and government regula-tors have presented plausible solutions to the looming energy shortage during the

Stratbase ADr Institute (ADrI) energy Forum held recently. Prof. Victor Andres C. Manhit, president of Stratbase ADrI, cited the need for an energy reform agenda that will reduce the country's dependence on imported fuel and maximize the local energy supply without harming the environment. “not only is the cost of electricity here among the highest in Asia, supply has always been verging on inadequate, especially in some parts of the country. Inadequate energy resources pose a binding constraint to the country’s sus-tained economic growth. the unmet demand also translates into higher power costs and brownouts. Strategies must be implemented to augment the country’s energy supply in the future,” Manhit said. Prof. Carlos Primo David, ADrI trustee who led the discussion, said that in Mind-anao, the country’s second-largest island, rotating brownouts of up to 12 hours have been a regular occurrence since 2010 due to rising demand. Meanwhile, the supply of the Malampaya natural-gas field, a major source of fuel for power plants, is projected to run out by 2030. "this will be a major blow to the energy-sector landscape as it roughly provides 40 percent to 45 percent of the Luzon grid’s current power requirements, or about 15 percent of the total power demand of the country," David said. Participants also highlighted the prospects and challenges of adopting a balanced mix of fossil fuel-based and local renewable-energy (re) sources as a viable strategy for a stable, environ-ment-friendly and affordable energy supply. Jose S. Alejandro, director for energy and power at the Philippine Chamber of Commerce and Industry (PCCI), said the chamber has been pushing for the review of the rules of the Whole-sale electricity Sport Market amid the short supply regime. the review also aims to develop a clear, measurable program and milestones on how to reach a competitive level in power pric-ing, he said. “On a scale of 1 to 10, the biggest rated polluter [10] is transportation, followed by agricultural waste at about 5 out of 6 and energy at level 3 or

4. the Philippines has the lowest per capita use of energy in the region and, therefore, curtailing or conserving energy use would have minimal ef-fects unless it is addressed to the large consum-ers,” Alejandro said. energy regulatory Commission executive Director lawyer Saturnino Juan said despite legal challenges in the feed-in-tariff system, through fiscal and nonfiscal incentives, more investments into re are coming in and this should reduce dependence on imported fuel, give a secure energy future and advance the cause of environmental protection. energy Undersecretary Zenaida y. Monsada cited Department of energy (DOe) efforts in promoting more investments in re, adding that processing now takes only 45 days. She said the agency also launched the energy Vir-tual Watch Service System, which tracks the progress of applications and can be monitored by the public. rep. rey V. Umali of the Second District of Oriental Mindoro, chairman of the Com-mittee on Power and energy of the House of representatives, shared his observations in Singapore and experience in Mindoro on how expanding access to electricity has fueled eco-nomic development, which further illustrates the quickening effect of energy security to the local and national economy. Among the participants were representatives from the PCCI, energy regulatory Commission, trans-Asia, Foundation for economic Freedom, retail electricity Suppliers Association of the Philippines, DOe, CitizenWatch, national Power Corp., embassy of the United States, embassy of Japan, embassy of germany, San Miguel Corp. global Power Holdings Corp., Chamber of Mines of the Philippines, JCPC, and Umali. the forum is part of a series of discussions at-tended by the country’s experts from academe, the government and the private sector to con-tribute valuable inputs that will be integrated with the institute’s flagship project called the Strategic Agenda for national Development. this would serve as a road map that goes beyond the six-year political cycle. Stratbase ADrI is an independent strate-gic and international research organization that aims to deliver a meaningful response and contribute to the developmental debate in the country.

By Catherine N. Pillas

tHe Philippines wants efforts to boost micro, small and medium enterprises (MSMes) in-cluded in the proposed regional economic

Cooperation Partnership (rCeP). negotiations for the proposed trade agreement cov-ering Association of Southeast Asian nation (Asean) and its trading partners are being eyed for conclusion by the end of the year. trade Undersecretary Adrian S. Cristobal said that aside from advocating the MSMe agenda in the World trade Organization during its Ministerial Conference in December, Manila will also push the sector’s inclusion in the discussions of rCeP participating-countries. the Philippines will present the case of MSMes at a ministerial meeting scheduled on July 13 and 14, Cristobal said. the rCeP, an expansive trade agreement covering the 10 Asean member-countries and the nations that they have free-trade agreements (FtA) with, is being targeted for conclusion by the end of 2015. the trade official said efforts to boost MSMes through the FtA has already been discussed among the chapters on cooperation, but will be tackled thoroughly in the July meeting. “We just want to make sure that whatever trade agreement we entered into, our MSMes will also have

In a statement, tUCP President ernesto Herrera, a key founder of the Philippine Seafarers’ Union, said some 53,000 overseas Filipino work-ers (OFWs) are in greece, with the majority of them sailors aboard mer-chant ships operating out of Athens. “We are counting on greek trading ships, which are earning quite a lot in US dollars, to stay afloat. they are fairly insulated from the greek government’s extreme financial distress,” the former senator said. According to Herrera, the greek mer-chant fleet is a vital cog of global trade. greek companies run 16 percent of the world’s trading vessels. greece is the Phil-ippines’s fifth-largest source of dollar re-mittances from sailors, after the US, the United Kingdom, germany and Japan, according to Herrera, former chairman of the Senate Committee on Labor, employ-ment and Human resource Development. Herrera said OFWs in greece remit-ted a total of $335.45 million to their

Monday, July 6, 2015 • Editors: Vittorio V. Vitug and Max V. de Leon

Filipino sailors aboard Greek ships insulated from debt crisis–Herrera

The Trade Union Congress of the Philippines (TUCP) on Sunday expressed confidence that the thousands of Filipino sailors aboard Greek trading ships will not be

affected by the european country’s debt crisis.

PHL wants MSME agenda included in RCEP

Govt debt payments hit P262B in April

Think tank: Next administration needs energy strategy to avert power crisis

Greece is FiFtH-larGest source oF dollars From sailors

By Jovee Marie N. dela Cruz

families in the Philippines in 2014, 87 percent from sailors. He said the OFWs in greece sent home another $105.43 million from January to April this year, and 88 percent of the money came from sailors. Herrera, cit-ing bangko Sentral ng Pilipinas statis-tics, said sailors now generate 25 cents out of every dollar that the Philippines receives by wire from an OFW. Filipino sailors around the world sent home a record-high $5.755 billion in

2014, up $540 million, or 10.3 percent, from $5.215 billion in 2013, he added. Herrera said that from January to April this year, they wired home a total of $1.916 billion, up $102 million, or 5.6 percent, from $1.814 billion over the same four-month period in 2014. the greek government, which owes foreign creditors some $359 billion, failed to make a $1.73-billion loan repayment to the International Mon-etary Fund that was due on June 30.

CRISTOBAL: “We just want to make sure that whatever trade

agreement we entered into, our MSMEs will also have the opportunity to benefit from it. We have to do this

assessment in July and see if there is a need to take other measures to

move faster.”

the opportunity to benefit from it. We have to do this assessment in July and see if there is a need to take other measures to move faster,” Cristobal said. the trade official added that aside from the MS-Mes, the July meeting will focus on modalities, pos-sibly in the trade in goods, investment and services. While the rCeP negotiations are progressing, Cristobal said there seems to be little challenge for the Philippines to meet the “level of ambition” in the coverage of trade in goods, and is in a good position to take advantage of the 3-billion population of the Asean countries and their FtA partners.

Budget Secretary Florencio B. Abad said that while govern-ment spending increased in

April year-on-year by as much as P34.4 billion, interest payment (IP) on gov-ernment debts slightly declined by 0.2 percent to P116.3 billion, to allow more appropriations that will boost growth. the department of Budget and Management (dBM) reported that total national government (Ng) dis-bursements in April 2015 increased by 5.5 percent to P660.6 billion, from P626.1 billion in the same period last year, or an increase of P34.4 billion.However, the budget chief said there was a slight decline in non-notice of cash allocation (NCA) disburse-ments as of April this year, with IP as of April staying at P116 billion, the same as in 2014. “As we continue to reduce our debt burden, the government can provide greater budgetary support to key social and economic services. that means more funds for education, health care and infrastructure development, among others,” Abad said. He said the majority of agency al-lotments were released at the start of the year, with 84 percent of the total obligation program released by end-April. the rate of early budget release was higher compared with 2013’s 73 percent and 80 percent in 2014.

the budget chief said the issuance of Administrative Order 46 will help agencies and departments utilize their annual allocations effectively through better project monitoring and evaluation and procurement prac-tices, as well as program execution. “Although spending for April grew year-on-year, much more needs to be done so that disbursements can move faster. departments and agencies—particularly those with urgent, big-ticket items—should optimize their allocations so that we can look forward to more efficient spending and the faster delivery of services,” Abad said. Abad added that disbursements from NCAs grew by 17.3 percent in April, compared to 2014 levels, in-creasing cumulative NCA disburse-ments as of April by 11.6 percent. Agencies with improved dis-bursements include the Office of the President and the departments of education, Public Works, Social Welfare and development, and the Interior and Local government, as well as the Autonomous Region in Muslim Mindanao. Productive spending—or expen-ditures for Maintenance and Other Operating expenses and Capital Out-lays (CO)—went up by 22.1 percent in April, with CO expenditures rising by 40.3 percent. Estrella Torres

PRIvAte-SeCtOR sup-port for Manila’s host-ing of this year’s Asia

Pacific Retailers Convention and exposition (APRCe) con-tinues to build up as business-es recognize the importance of a successful staging of the event to the country’s image as a strategic retail hub in the region in time for the Associa-tion of Southeast Asian Nation (Asean) integration. the country, through the efforts of the Philippine Retailers Association (PRA)—the recognized national organization of retailers and suppliers in the country—will host the biennial conference and expo again after more than two decades. the 17th APRCe, organized by the Federation of Asia Pacific Retailers Association (Fapra), is slated from October 28 to 30 this year at the SMX Convention Center in Pasay City. PRA President Lorenzo C. Formoso, chief operating officer of duty Free Philippines, said they need the full support of the private sector to ensure the success of the 17th APRCe Manila 2015. “We already have the full backing of the government, with no less than President Aquino and department of tourism Secretary Ramon R. Jimenez Jr. committing to give our guests from Asia and other parts of the world a great experience while they are here for the grand stag-ing of the APRCe 2015 in October,” Formoso stressed. Companies that have committed their support to the APRCe 2015 include the SM Store and Wyeth Nutrition as copresentors; Bench, Flight 001 and Penshoppe as platinum sponsors; duty Free Philippines, HP, Wilcon depot and Met tathione as silver sponsors; Philippine

Airlines as the official carrier; Media Blitz group as official PR partner; Retail Asia, as the official interna-tional publication; and Fascin8 as the official digital advertising partner. “We thank the companies that have already signed up for the event and we hope more groups will help us in ensuring the success of APRCe 2015. We need greater private-sector participation as this will showcase the country to the rest of the world,” Formoso emphasized. the PRA won the bid to host the prestigious bien-nial event during the 2013 APRCe in Istanbul, turkey. Officials of Fapra, the regional organization of the rec-ognized national retail associations in the 17 member-countries in Asia Pacific that include Singapore, thai-land, Malaysia, Indonesia, vietnam, the Philippines, Hong Kong, taiwan, China, Japan, Korea, Australia, New Zealand, India, Mongolia, Fiji and turkey, visited the country last September to check the preparations being undertaken by the PRA. they also paid a cour-tesy call on President Aquino at Malacaňang. the APRCe is a major activity of Fapra. every two years, Fapra members choose a member-association to host the grand gala for retailers in the Asia-Pacific re-gion. the event has become Asia’s largest and longest-running retail convention and exhibition since it was first held in 1983. the APRCe aims to discover new approaches to is-sues facing the region’s retailers and highlight inno-vative solutions that can help retailers differentiate themselves from competitors and to deliver greater value to consumers. For inquiries, call the APRCe secretariat at 687-4180, 687-4181, 687-4985, or e-mail secgen@philretailers.com, aprce2015@philretailers.com, ebbs@philretailers.com, asecgen@philretailers.com, or visit its web site at www.philretailers.com, www.2015APRCEMANILA.com.ph.

After a weeklong trade and invest-ment mission in the united States and europe, trade Secretary gregory L. domingo reported that aircraft original equipment manufacturers

(OeMs) are looking to buy more from Philippine-based suppliers. “We met a lot of aerospace compa-nies, Airbus and Boeing, for example. Some of the OeMs of the aircraft of

news@businessmirror.com.ph Monday, July 6, 2015 A5BusinessMirrorEconomy

Global aerospace players looking to source more parts from PHLEuropEan aerospace players

expressed interest in sourcing more of their requirements from

the philippines during a recent trade and investment mission abroad, a Cabinet official said.

companies are expanding and they’ve sent a preliminary mission here. they will send a buying mission here in September to add to their current purchases,” said domingo, without specifying particular companies. Five aerospace parts and com-ponents suppliers currently have presence in the Philippines, includ-ing Jamco Aerospace, Be Aerospace and Moog Controls. these companies are on the ex-pansion path as well, domingo said.He, however, noted that the bigger potential of the Philippines lies in the maintenance, repair and over-haul (MRO) sector.

“Our MROs are expanding also—we have Lufthansa technik and Si-nagapore engineering. the future looks bright for MRO providers, it looks like more will locate here,” do-mingo said. Aside from the aerospace indus-try, the Cabinet official’s trade and investment mission to europe also focused on infrastructure and in-formation technology and business-process management. Aside from the aerospace industry, european businesses also expressed interest in Web-based services, invest-ment banking and fund-management services. Catherine N. Pillas

‘Less budget for interest payments means more funds to boost growth’

Private-sector support for APRCE Manila 2015 swells

formoso

By Recto Mercene

SeNAte President Pro tem-pore Ralph Recto said some of the earnings from the ex-

pected boom in casino and gaming activities should be used to acquire more doppler radars that can be used by the Philippine Atmosphe- ric, geophysical and Astronomical Services Administration (Pagasa) for its modernization. Recto said this is the goal of his bill mandating state gaming regu-lator Philippine Amusement and gaming Corp. (Pagcor) to set aside P3 billion for the modernization of Pagasa and allow the weather bureau to deliver “reliable, timely, localized” forecast. Recto said the amount would come from the 50-percent share of the national government in the revenues that Pagcor remits to the government. Recto added that the Senate has opted to tap “off-budget” sources for Pagasa’s moderniza-tion “in order not to crowd out other important social expendi-tures in the national budget.” He said: “If we need to get it from gaming revenues, so be it. We need the money so we don’t have to roll the dice—or read the cards—in predicting if it will rain tomorrow.” In the Recto bill currently be-ing debated in the Senate, Pagcor funds would help Pagasa procure modern equipment such as dop-pler radars, set up a world-class weather data center and other

equipment. “even communica-tion equipment, which would allow Pagcor to f lood social me-dia with warnings that a f lood is coming.” Recto said the bill’s “vision is for Pagasa to go local,” and this re-quires the deployment of weather equipment in as many areas in the country as possible. “We want a weather bureau to tell us when and where it would rain, so that the man behind the carabao in Mindoro will know when to plow the field and the man behind the wheel in Malabon will know when to plod through flooded streets,” Recto said. “Weather forecast is traffic app, especially in Metro Manila, where the economic cost of vehicular traf-fic is already P2.4 billion on an un-eventful day and possibly twice that amount on bad-weather nights,” Recto said. At present, 10 doppler radars provide service from Aparri, Ca-gayan to Hinatuan, Surigao del Sur. Five more are being built. Pagcor gets bulk of its revenues from casino and gaming operations and from the granting of licenses to private casino operators. In 2014 the gaming agency booked a revenue of P39.9 billion and remitted P14 billion to the na-tional government. global casino players, in part-nership with local groups, have opened shop in the country. Among the first were Bloomberry Resorts’ Solaire Resort and Casino, Melco

Crown entertainment’s City of dreams Manila and Malaysian-backed Resorts World Manila. At least two more integrated casino resorts are set to open in the next few years, namely, Ma-nila Bayshore, a joint venture be-tween Alliance global group Inc. and Malaysia’s genting group; and Japanese billionaire Kazuo Okada’s Manila Bay Resorts. Pagcor regulates all casinos in the country. Recto, who also chairs the Sen-ate Science and technology Com-mittee, stressed “the ferocious, fickle and frequent storms” climate change brings in, and called for “a strengthened weather agency, which can warn and guide the pub-lic on how to respond to threats to lives and properties.” Recto said a parade of cyclones from 2004 to 2014 left 14,150 dead, 46,691 injured and 4,169 missing; damaged 4.5 million houses and destroyed P338 billion worth of properties. Recto’s bill places the total cost to modernize Pagasa at P3.9 bil-lion, plus P45 million annually to fund the compensation adjust-ments, and P70 million for train-ing and scholarships. “We need a personnel-retention scheme because more and more Pagasa personnel leave the Philip-pine area of responsibility yearly,” the senator said. But even without the Philip-pines sitting on the typhoon belt, a modern weather bureau is still

needed because “human activities are weather-dependent, so we need a depend-able weather service.” Recto said the modernization of Pagasa remains a “missing link” in the country’s climate change-adaptation efforts. “there can be no climate-change adaptation with-out weather bureau modernization.”

Recto wants casino revenues to fund Pagasa modernization

Monday, July 6, 2015 • Editor: Carla Mortel-BaricauaA6

Tourism& Entertainment

So-called because its name was coined from the Spanish phrase “Mina de Oro”—which literally meant “mine of gold,”—Mindoro’s soil is rich in gold deposits  and other natural wonders, which is considered its other gold mine. 

Here’s a quick guide on how to ex-plore this bucolic province and mine its tourist �elds of gold.

Puerto GaleraONE of the country’s earliest beach hideaways discovered in the 1970s by European backpackers, this resort town is a top-of-mind destination for beach bums. It has a series of beach coves, each with a distinct character,

from the vibrant night life of Sabang and White Beach, to the more quiet and sleepy shores of Aninuan and Bo-quete. Named to the prestigious Par-is-based “Most Beautiful Bays in the World Club” in 2005, Puerto Galera is a hot spot for marine biodiversity be-ing at the heart of the world’s “Coral Triangle.” Needless to say, it boasts of the most mesmerizing dive sites in this part of the globe.  In between scouring the coves and beaches or scuba diving, there are interesting �nds such as quaint resorts and res-taurants, indigenous Mangyan  vil-lages, waterfalls and breathtaking view decks. 

Beguiling beachesWITH a long coastline running from north to south, the province is dotted with sun-kissed beaches and uninhab-ited islets, which will surely make you a stranger on the shore.  A must-visit is the southernmost town of Bulalacao, a mini-archipelagic town that takes pride in the irresistible islets of As-lom, Buyayao, Sibalat, Maasin, Tam-baron, Alibatan (Target) and Suguic-ay. �ese islands take you back to the good old days of countryside living bereft of modern amenities but over-�owing in nature’s bounty. Buktot in Mansalay is another noteworthy beach if you want a serene excursion away from the multitude.

Wondrous waterworldIN addition to its rich coastlines, the province also takes pride in its mes-merizing waterfalls, lakes and rushing rivers, which make it a wondrous wa-terworld.  Soak in the rejuvenating icy cascades of Tamaraw Falls in Puerto Galera, Botolan in San Teodoro, Al-paparay in Baco, Manihala in Bansud and Walang Langit in Gloria, which is among the most sought-after be-cause of the thick canopy en route to the place. You can also cruise aboard a banca or bamboo raft in the tranquil

ORIENTAL MINDORO’S FIELDS OF GOLD

S P B L. S

WHEN rock star Sting (of �e Police fame) sang “Fields of Gold,”

he can very well be referring to Oriental Mindoro because of its seemingly magical allure.

WHITE-WATER kayaking in Arigoy River, San Teodoro SUGUICAY islet in Bulalacao town

MANIHALA Falls in Bansud

LOCAL �shermen at Naujan Lake PANDANG Gitab night street dancing

CALAUANGAN Lake in Calapan

Tourism& Entertainmenttourism@businessmirror.com.ph • Monday, July 6, 2015 A7

waters of Pola River, Caluangan Lake in Calapan, and Naujan Lake, or get a hydromassage at Lantuyang River in Baco. For a dose of adrenaline, try your hand in white-water kayaking at Aringoy River in San Teodoro, or at the Fortuna Tropical Upland Resort in So-corro, the must-do extreme adventure in Mindoro.

Cozy up in CalapanTHE capital city of Calapan is the place to be if you want a dash of modern liv-ing with its handful of boutique hotels, beach resorts and pocket shopping malls.  It is also the province’s gateway from Batangas City with its fast craft and roll-on, roll-o� service. �e man-grove forest in Silonay is a showcase of coastal biodiversity, bird-watching and sustainable tourism where every guest is given the opportunity to plant a mangrove seedling. �ere are two outlying islands o� Calapan’s coast a swimming distance away, which guests can hop into and commune with na-ture without the madding crowd.

Mount HalconMOUNTAINEERING is among the most fascinating outdoor activity for Pinoys, and in this department, Mount Halcon won’t disappoint. Standing at

2,582 feet tall, it is regarded as one of the toughest climbs in the archipelago and favorite site to hold world-class tropical mountaineering challenges. Straddling the two Mindoro provinces, the majestic mountain is habitat to endemic �ora and fauna. Halcon is not your ordinary mountain, so better train hard before ascending this peak.

Soul searchingA PRE-SPANISH settlement, Oriental Mindoro mirrors the soul of the archi-pelago. �is can be seen at the Puerto Galera’s Excavation Museum, where re-markable unearthed China ware from the Sung Dynasty and sunken goods from the Manila-Acapulco galleon are on display. �e church ruins of Bancuro in Naujan and Kuta in Bong-abong tell of the sowing of the seeds of Catholicism in the then undivided Mindoro province. �e indigenous villages of Mangyan tribes are living museums where visitors can catch a glimpse of the inhabitants’ way of life. A cultural event that serves as the window to the Mindoreño soul is the Pandang Gitab Festival, a fu-sion of the words pandango dance and dagitab, which immortalizes the �sher-folk’s native dance before they set out into the sea.

ORIENTAL MINDORO’S FIELDS OF GOLD

SUMMER may be o�cially over but the fun continues in the bountiful Bicol region with its

colorful array of festivities to bring to the fore its rich cultural legacy.

Merry-making kicked o� at the Pinangat Festival, which is inspired by the culinary pride of Camalig, Albay. A signature Bicol delicacy, pinangat is made up of shredded  gabi  leaves, red ginger, tiny shrimps or slices of salted �sh or pork and crushed pepper, and cooked in coconut milk.

Highlights included the street portrayal of the harvest and cooking process of the famed dish in a grand parade, and the holding of a 600-me-ter-long line of pinangat, akin to a community boodle �ght.

Polangui, Albay, relived its humble beginnings with the Pulang Angui Festival, which tells the legend of Pulang Angui, a lovely maiden in red gown who roamed the forests dur-ing the town’s ancient days. �e mu-nicipality’s name is believed to have evolved from this story passed on through generations.

Coinciding with the patronal �esta of Saints Peter and Paul, the locus of the fest is the street theater, which reenacts the life and times of its mythical lady.

Tabaco City shined with the 12th Tabak Festival, which highlights its vibrant cutlery industry. Situated by the foot of the perfect-coned Mayon Volcano in Albay, the city is a major producer of quality scissors, knives and bolos because of its skilled blacksmiths whose craftsmanship is showcased in the interpretative dance presentation.

Albay Gov. Joey S. Salceda said the province has positioned itself as “Planet Festival” because of its colorful and exciting festivities the whole year round derived from its local lore, cottage industries and tra-ditional cuisine.

He noted that tourist arrivals in the province has grown exponentially over the past two years because of the

lure provided by the yearlong festivi-ties, as well as its new unique destina-tions, which supplement its iconic at-traction—Mayon Volcano

Salceda also pointed out that its culinary tourism program, Culinaria Albay, has also put the province on the traveler’s food-trip map because of the mouthwatering cuisine o�ered by quaint restaurants.

Meanwhile, the best tourist events in the region converged in the Gayon Bikol Festival of Festivals Showdown in Daet, Camarines Norte, on  June 23. �e host municipality, home to Rizal’s First Monument and the re-gion’s sur�ng and kiteboarding haven,

also celebrated its 431st founding day, 20th  Pinyasan Festival and patronal feast of Saint John.

Participating festivals are Cagsawa of Daraga and Sun Flower of Ligao City, Albay; Burak of Virac, Catanduanes; Palong of Capalonga, Camarines Sur; Padaraw of Bulan, Sorsogon; and the award-winning Lapay Bantigue of Masbate City.

Organized by the Department of Tourism-Region 5, Gayon Bikol is an annual event that hopes to strengthen the region’s position as among the fastest-growing tourist hideaways in the country because of its vibrant culture.

Bicol’s beauty and bounty in a nutshell

ASIAN cuisines  do  share similari-ties, but as far as the dining eti-quettes go, it is quite the oppo-

site. For example, an empty plate means di�erent things to di�erent cultures. In Japan it’s important to �nish your food in order to let the host know you en-joyed the meal. In China, however, it is considered rude and means that you weren’t fed enough.

Foodpanda/hellofood collected some useful Asian food customs and their asso-ciated meanings to set things straight. So here is your essential guide to do’s and dont’s in some countries in order to avoid any uncomfortable mistakes everyone is inevitably bound to make.

The foodpanda group is the leading global online food-delivery marketplace, active in 40 countries on �ve continents. The company enables restaurants to be-come visible in the online and mobile world, and provides them with a con-stantly evolving online technology.  For consumers, foodpanda o�ers the conve-nience to order food online and the widest gastronomic range, from which they can choose their favorite meal on the Web or via the app. Foodpanda operates in India, Thailand, Indonesia, Pakistan, Singapore, Malaysia, Brunei Darussalam, Vietnam, Taiwan, Bangladesh, Kazakhstan, Hong Kong, the Philippines, Russia, Ukraine, Hungary, Romania, Bulgaria, Georgia and Serbia. Hellofood operates in Brazil, Mexico, Saudi Arabia, Jordan, Egypt, Ni-geria, Morocco, Kenya, Ghana, Senegal, Ivory Coast, Rwanda, Tanzania, Uganda and Algeria. Delivery Club operates in Russia. JUST EAT in India, NetPincer in Hungary, Donesi in Serbia, Bosnia & Her-zegovina and Montenegro, and Pauza in Croatia, Room Service in Malaysia and Singapore, City Delivery in the Philip-pines, Food By Phone in Thailand, Koziness and Dial-a-Dinner in Hong Kong, Eatoye in Pakistan, and 24h in United Arab Emirates.

THINGS YOU’RE DOING WRONG WHEN TRAVELING ASIA

Polangui’s Pulang Anggi Festival SUMLANG Lake with Mayon Volcano

PINYASAN Festival

LONGEST pinangat line in Camalig, Albay

TABAK Festival of Tabaco City

SUGUICAY islet in Bulalacao town

MANGYAN handicrafts

news@businessmirror.com.ph

48,800 senior citizens in Northern Mindanao to receive pensions

A8

Senior citizens get P700,000 worth of various equipment

Over 200 seniors in the fifth con-gressional district who had their birthdays in January had received their share of the allotment on June 25, Nancy L. Sabado said. Each got a P300 birthday cash gift.

Sabado said seniors in the Fourth District born in January were sched-uled to receive the amount on July 2, while their counterparts in the Third District got the birthday cash gift on June 30 and July 1.

On July 9 and 10, January-born se-niors in the First District were sched-uled to receive their birthday cash gift.

Recipients in the Second and Sixth districts would receive it on dates to be announced later, Sabado said.

Seniors born on other months would receive their birthday cash gifts on dates still to be announced.

In case the P30-million allotment would prove inadequate to cover the unforeseen number of seniors in Ma-

nila who would claim this privilege, the city council would work out a supple-mentary budget, she said.

Currently, Manila has an estimated 120,000 senior citizens, Sabado added.

Osca’s database is still gathering the number, she said. The exact figure would be determined most likely in December.

On June 18 the city also rewarded 14 centenarians with a P15,000 cash gift each, a wheelchair, and a grocery pack. The oldest recipient is 114 years old.

Among the recipients is Herminia P. Rodriguez,101, who has been liv-ing in the streets and selling candles, candies and newspapers for a living.

Of the P15,000 cash gift, P10,000 came from the mayor’s office and the P5,000 from the vice mayor’s, Sabado said. The giving of the birthday cash to the city’s senior citizens was approved in October 2014, she said. But it was only in the third week of June this year that Manila seniors began to receive it.

Manila seniors get cash gifts for their birthdays

OLDER people in the country’s capital are now receiving cash gifts for their birthdays

amounting to P30 million this year, the spokesman of Manila’s Office for Senior Citizens Affairs (Osca) told the BusinessMirror last week.

ElderlyBusinessMirror

The

By Oliver Samson | Correspondent

Monday, July 6, 2015 • Editor: Efleda P. Campos

PhilRealty plansto build condos for active seniors

By Rizza Marie Edu Special to the BusinessMirror

HOUSING for the ambulant elderly in the US has been subsidized by their govern-

ment for years. In the Philippines and in many

developing economies, governments do not usually set their focus on their elderly. The private sector, specifi-cally companies, goes through a lot of trouble to come up with units that fit their customers’ specific housing need. Thus, housing here especially developed for the elderly is a rela-tively new business concept.

Real-estate developer Philippine Realty and Holdings Corp. (PhilRe-alty) is set to build condominium units geared toward the active se-nior population.

PhilRealty President and CEO Andrew Alcid said the company is targeting multigenerations, follow-ing last year’s statement of making One Balete in Quezon City a family compound reinvented. This new proj-ect that targets the senior members of the family tries to create a space for them that’s both convenient and comfortable. The layout or orienta-tion of the bathrooms and kitchens will be a little bit different from a regular condominium.

“In other words, you build a reg-ular home but the sinks may be a little bit lower, the faucets used are different from the regular faucets you find in regular condominiums. So it’s really geared toward the older generation, especially for the active seniors,” Alcid said

The utility area will also provide space for maids or caregivers if the seniors want their company.

Accessibility also won’t be a prob-lem because this third tower in One Balete will have senior occupants up to the eighth or ninth floor, making it easier for them to be carried down should there be an emergency, said Ramon Olives, PhilRealty vice presi-dent and chief brand officer.

“The reason we also [put them] in the lower floors is because you have to understand how far a snorkel truck or a fire truck can reach in case of an emergency,” he said.

The tower, which Alcid estimated would consist of up to around 150 units, follows an upper- and lower- house concept, where the former would be occupied by the younger crowd. Though it’s a senior-assisted living facility, it will not be geared toward the convalescent or the el-derly who need 100-percent medical attention, he said.

This project falls under PhilRe-alty’s health-care thrust and will be built within close proximity to medical facilities, like St. Luke’s Medical Center, like the soon-to-be-built third tower in One Balete. Alcid said they are also looking at locations out of town, making sure each one is strategically placed near hospitals to cater to the needs of older people more easily.

“I’m hoping that by early next year, we can start, as soon we hit a certain critical mass within Sky Vil-las,” Alcid said.

Sky Villas is a 113-unit condo-minium in One Balete which is the company’s current focus. Real estate and health care are just two of Phil-Realty’s five corporate pillars; power, education and financial services are the other three.

Story & photo by Marionne Denise R. LopezSpecial to the BusinessMirror

IN his 16 years of serving as a lay minister, the faith of Vergel Saro-sario was put to the test after he

was diagnosed with prostate cancer. Vergel, also known as Brother

Andy, was born and raised in Cavite, fourth of five siblings, son of Pedro and Aurora Sarosario.

Before serving as a lay minister, Andy worked as an internal auditor at the Department of Education. He and his wife Guillerma were blessed with two daughters, Pinky and Christine.

At age 70, Andy was diagnosed with Stage 4 prostate cancer; he considered this as one of the most frightening events that ever hap-pened to him.

While playing with his hands and speaking in a low-tone voice, he re-called how faith became his source of strength in battling the disease.

“Noong Pebrero 2010, naoperahan ako ng prostate cancer Stage 4. Pina-ka-grabe na iyon. Sabi ng doctor, ang buhay ko ay maaring tatlong buwan na lang. Lalo akong nagpursige sa pag-sisimba at dasal ang aking ginawa,” he said, while fixing his eyeglasses.

Everyone thought this was the last hard blow, but another catas-trophe happened to the family; his wife Guillerma was also diagnosed with Breast Cancer Stage 4 at 79. She lived another year and died at 80 in 2013.

For five years, Andy believed that by God’s mercy, he recovered from cancer. He considered alter-native medicine as a replacement for chemotherapy.

He took a vacation in London to visit his younger daughter from August to October 2014. He felt his

sickness recurring. “Nung bumalik ako dito dun

umatake ulit, natakot ako kasi pa-rang hinihila na ’yung buhay ko, eh. Nakaramdam na ako, sabi ko, ‘Lord, wag naman kung gusto niyo talaga akong kunin papayag na ako pero kung hindi naman pagbigyan niyo pa ako,’” he said, while trying not to cry.

Passage he was wont to think was Luke 9:23: “Whoever wants to be

My disciple must deny themselves and take up their cross daily and follow Me.”

While problems continue to challenge Andy and his family, he has surrendered all these to God and remained strong in his faith.

“Bahala na ang Diyos diyan; nasa kamay na ng Panginoong Diyos iyan. Kung ano ang gusto Niyang gawin sa akin, tatanggapin ko na,” he said.

Faith of man tested by series of catastrophes

blessed to have their grandparents Many grandparents in the philippines continue to take the role of primary caregivers to their grandchildren. their great love and sacrifice for the young ones deserve to be paid tribute to, and their concerns, particularly their health requirements, should be a priority to both their families and the government. MAU VICTA

BROTHER Andy wears his Knights of Columbus uniform.

L AUA-AN, Antique—The elderly group from Laua-an, Antique, who

form members of the Office for Senior Citizens Affairs (Osca), recently received P700,000 worth of equipment and faci l ities from Bottom-up Budgeting (BUB) project of the national government through the Department of Social Welfare and Development (DSWD).

Led by Guadalupe Juayno, Osca chairman, the group received a photocopying machine, computer set, LCD projector, digital camera, DVD player, a television set, sofa, electric fan, blood- pressure apparatus, wheelchairs and flashlights, among others, which fully equipped their Senior Citizens center located in the town’s Poblacion area.

“The equipment and facilities are actually rewards of the Bottom-up Budgeting process. The actual project is the paradigm shift among the people of Laua-an, particularly the senior citizens who identified their need, planned and executed the solution to their problem. Now you don’t just have a fully equipped senior citizen center but you also know that in you is the power to make positive changes in your locality,” Pacita Sarino of the DSWD Central Office said.

BUB is an approach to the preparation of the agency budget proposals, taking into consideration the development needs of the cities and municipalities as identified by their respective local poverty- reduction action plans that are

formulated with the strong participation of basic sector organizations and other civil- society organizations.

This strategy is implemented in pursuit of attaining the Philippine Development Plan’s goal of inclusive growth, and poverty reduction and promoting good governance at the local level.

BUB is jointly implemented by the national government in partnership with the local government units, specifically the Department of the Interior and Local Government, Department of Budget and Management, National Anti-Poverty Commission, Bureau of Fisheries and Aquatic Resources, Department of Environment and Natural Resources, Department of Health, Department of Labor and Employment, Department of Education, DSWD, Department of Trade and Industry, Department of Tourism, National Economic and Development Authority, National Irrigation Authority, National Commission on Indigenous Peoples Technical Educations Skills and Development Authority, Department of Energy and the National Electrification Administration.

Laua-an Mayor Francisco Baladjay Jr. expressed his gratefulness for the assistance, but also told the senior citizens to ensure that the equipment and facilities are well-maintained.

Juayno promised that they will do their best to protect and maintain the equipment and facilities. PNA

CAGAYAN DE ORO CITY—More than 48,800 senior citi-zens in Northern Mindanao

will receive a quarterly pension of P1,500, the Department of Social Welfare and Development (DSWD) here said on Wednesday. Charmaine Tadlas, the regional

DSWD information officer, said the DSWD arrived at the figure after vali-dating 29,499 additional senior citi-zens to the DSWD’s existing 18,501 lists of senior citizens in the region. She said the government has ex-tended a quarterly pension to quali-fied senior citizens in Northern Min-

danao in January 2011 to augment the senior citizen’s medical needs and foods. Any qualified senior citizen could apply at the City or Municipal Social Welfare and Development Office under the local government unit. They can also apply at the Of-

fice for the Senior Citizens Affairs, Tadlas said. She said the qualified senior citi-zens are those considered to be indi-gent, and are 66 years old above and are not beneficiaries of any pension, such as Social Security System and Government Service Insurance Sys-

tem, among others. The DSWD would announce the release of the pension on a quarterly basis (March, June, September, and December). The senior citizen could claim the pension at the Osca or City/Municipal Social Welfare and Devel-opment Office. PNA

ALCID: “In other words, you build a regular home but the sinks may be a little bit lower, the faucets used

are different from the regular faucets you find in regular condominiums. So

it’s really geared toward the older

generation, especially for the active seniors.”

news@businessmirror.com.ph BusinessMirrorThe Regions

A9 Monday, July 6, 2015 • Editor: Dionisio L. Pelayo

DRENCHED Residents of Baguio City walk along the city’s central business district against wind and rain brought by Tropical Storm Egay (international code name Linfa). The local weather bureau said the city is under Storm Signal No. 1 and recorded 179.8 maximum rain per minute of rainfall since July 5. MAU VICTA

TALLEST GRASS A farmer in Balintocatoc, Santiago City, Isabela, looks for matured bamboo he plans to use to reinforce his hut against typhoons. The plant, known to be the tallest variety of grass, serves as the basic raw material in the construction of farm houses, baskets, picket fences, barbecue sticks and other countryside structures. LEONARDO PERANTE II

8990 Holdings Inc. buys Iñigos’ 100-hectare property in Davao

Januario Jesus Gregorio Atencio III, the company president and CEO, said that the property it bought is a 100-hectare estate in the southern part of country’s largest city.

He did not disclose the amount of acquisition.

Atencio said the property firm, known for its wakeboard parks as

one of its amenities in some of its developments, has been in talks with the Iñigo family for more than a year before he sealed the deal.

“We will start the project prob-ably at the earliest in 2017. We al-ready have our inventory for 2017,” Atencio told reporters.

Atencio said 8990 Holdings may

spend an estimated P4.3 billion to build around 6,500 units that it will develop over a five-year pe-riod. It will replace its project in Mintal, where its wakeboard park is located. The company said it will conclude the development after seven years.

The company is confident that Davao’s property market will con-tinue to grow in the coming years as people migrate into the city, one of the country’s safest, from the dif-ferent parts of Mindanao.

Aside from Davao, Atencio said the company will expand its footprint in other sites across the country, including in Zam-boanga and Bacolod, but the size of these properties combined is smaller compared with the new acquisition in Davao.

The company plans to build a total of 11,083 housing units this

year, 44 percent of which will be in Luzon, 31 percent in the Visayas and 25 percent in Mindanao.

It successfully raised P9 billion from its maiden-bond offering, proceeds of which will be used to pay off its expensive debts. The company held a road show in Cebu and Davao for its retail-bond offer-ing, which has tenors of five, seven and 10 years.

For the first quarter of the year, the company’s income was flat at P937 million, as the company’s performance last year was so good that it’s difficult to match, Atencio said. For this year, however, the firm is still targeting a net-income growth of between 15 percent and 21 percent to about P3.8 billion to P4 billion. Revenue growth, mean-while, is estimated to grow between 22 percent and 27 percent at P9.6 billion to P10 billion.

By Rene Acosta 

H EAVY rains spawned by the prevailing southwest mon-soon has triggered massive

flooding in the province of La Union, inundating its capital of San Fernan-do City and 11 coastal municipalities, submerging houses into deep flood-waters and forcing the evacuation of thousands of residents.

Weather officials said the ex-tremely bad weather condition was whipped up by Tropical Storm Egay (international code name Linfa), which is affecting other provinces in Northern Luzon, Cordillera Admin-istrative Region, Southern Luzon, the Visayas and even Metro Manila.

“Flooding is massive here in La Union, with 11 coastal municipali-ties flooded because major river basins have swelled. Here in San Fernando, La Union, the flooding is still ongoing and the rain is also strong and even the winds,” said Office of Civil Defense 1 Regional Director Chito Castro on Sunday.

“The major roads here are already almost impassable. Houses have been swamped by floodwaters and there are houses that have also been completely inundated,” he said, de-scribing the severity of the flooding.

Castro said rescue teams and staff from different agencies form-ing the Provincial Disaster Risk Re-duction and Management Council (PDRRMC) have been out, helping the affected residents and imple-menting evacuation as it is needed,

as he admitted they were taken surprise by the amount of rainfall that was dumped by the southwest monsoon. “It appeared like there was a very strong typhoon,” he said.

“The PDRRMC Ilocos Sur of Gov. [Luis] Singson and of Gov. [Amado] Espino of Pangasinan were moving to assist La Union. If La Union can-not really deal with it, then we will ask help from the national govern-ment,” Castro said.

Weather forecasters said that aside from La Union, the southwest monsoon is affecting the provinces of Pangasinan, Zambales, Bataan, Cavite, Mindoro provinces, Batan-gas, Palawan, Marinduque, Rom-blon, Masbate, Burias Island, Cat-anduanes, Albay, Sorsogon, Que-zon, Polillo Island, Samar, Leyte, Negros provinces, Guimaras, Iloilo, Capiz, Aklan, Antique, Bohol, Cebu and even Metro Manila.

The southwest monsoon was being whipped up by Egay which is affecting the provinces of Kalinga, Apayao, Isabela, Quirino, Northern Aurora, Cagayan and Calayan Group of Islands, which are already under Storm Signal No 2.

Castro said that aside from the capital, the towns that were flooded included Agoo, Caba, Aringay, Bau-ang, San Juan and Bacnotan.

He said the flooding has trans-formed major roads and highways into rivers, sparing not even agricul-tural lands. As of 8 a.m. on Sunday, La Union has already experienced a province-wide power outage.

Egay triggers flooding in La Union

By Manuel T. Cayon             Mindanao Bureau Chief

 

DAVAO CITY—A Mindanao lawmaker whose commit-tee earlier warned of a re-

jected Bangsamoro basic law (BBL) proposal if the Moro guerrillas would not surrender the firearms of the police commandos killed in January in Mamasapano, Magu-indanao, expressed confidence of the passage of the House version of the law that would provide the legal basis for a new autonomous region in Mindanao. Rep. Rufus B. Rodriguez of the Second District of Cagayan De Oro, chairman of the House Committee on the BBL, said his committee has ensured that the BBL, now called  Basic Law for the Bangsamoro Autonomous Region “is constitutional.”

“We have made amendments and/or deletions to ensure that it is constitutional and consistent with the aspirations of the Bangsamoro,” he said in a statement posted by the Office of the Presidential Adviser on the Peace Process (Opapp).

The Opapp said Rodriguez “is a constitutionalist” and former dean of the San Sebastian College of Law.

The Opapp added that Rodriguez has stated that his committee “made the refinements to the draft BBL after various consultations with different stakeholders.”Rodriguez said the refinements and assurance of the rectified provisions would persuade the plenary in Congress to approve it when Congress resumes

deliberations on the draft BBL this month. He said the committee ver-sion of the BBL “is the country’s best chance for peace in southern Mindanao.” The Opapp said that another House committee member, Party-list Rep. Ibarra M. Gutierrez of Akbayan, has expressed confi-dence in the passage of the House Bill 5811, the lower house’s version of the BBL.

“If you listen to the explanations of some members of Congress who voted against the BBL, they were not talking about the substance of the law at all. They were talking about Mamasapano, they were in-sisting on tying the passage of BBL into some kind of a resolution of the Mamasapano issue, like return of firearms, filing of cases by the Department of Justice, or ambigu-ous standards like the MILF [Moro Islamic Liberation Front] showing sincerity as the government’s peace partner,” he said.

Gutierrez, a University of the Philippines professor, also pointed out that many of the provisions al-legedly constitutionally question-able in the draft BBL were already found in Republic Act (RA) 9054, or the Expanded Autonomous Region in Muslim Mindanao law.

“The BBL discussions have to go back to RA 9054 and the paranoia to its constitutionality makes us re-visit the ARMM law. What is written on the BBL is a reiteration of what is in the ARMM with additional provisions that ensure genuine au-tonomy,” Gutierrez said.

Former critic now wants govt to okay House version of BBL

By Joey PaviaCorrespondent

LUBAO, Pa mpa nga—T he municipal government, led by Mayor Mylyn Pineda-

Cayabyab, is adopting the policies and “best practices” of a progres-sive county in South Korea to fur-ther improve the delivery of basic services here. In her speech at the launch of the “Formation of Coop-erative Relationship” between Lu-bao and the Jeongseon County on Tuesday at the historic Saint Augus-tine Parish Church, Cayabyab said the improvement of the “standard of living” of the at least 150,000 residents of Lubao is the priority of the town’s government officials.

The Jeongseon County in Ganwon province, host to the 2018 Winter Olympics Alpine Skiing, was repre-sented by Shin Hyang-suk, women and youth director.  Cayabyab said they are inviting business entities to invest in the first-class town, which is the host of the highly successful annual Lubao International Balloon Festival in Pradera Verde, Barangay Prado Siongco.  “We want more busi-nesses and other livelihood opportu-nities for our people to hasten the

eradication of poverty,” Cayabyab said in the dialect.

“We are adopting the ways, equipment and best practices of the Jeongsen county to further improve our system in serving the people and enticing more economic activities,” the two-term mayor added. The daughter of Pampanga Gov. Lilia Pineda is transforming her town into a haven not just for ag-ricultural and livestock production, but for investments related to tour-ism, real estate and retail services. 

Cayabyab and the town coun-cil, led by Vice Mayor Robertito V. Diaz, earlier revised the tax code of the municipality resulting in high revenues since the mayor took of-fice in 2010. Local taxes were P3.9 million in 2011. Last year the total collection was almost P5.2 million, the highest-ever registered by the municipality with 44 barangays.  

 Councilor Jun John Susi said he and Lubao officials led by Cay-abyab visited Jeongseon in 2012. He said the delegation was “im-pressed by the beauty and clean-liness” of the county, home to the High I Ski Resort. The resort at 1,345 meters is at the highest altitude of the Korean ski resorts.

“The mayor and the other local and municipal officials are, indeed, going into the direction of attract-ing more quality and bigger invest-ments which provide more jobs,” said Susi, adding that the visit of the delegation is a “prelude” to the sign-ing of the sisterhood pact between Jeongseon and Lubao.    Korean Community Association-Pampanga Chapter President Kim Ki Young and Choi “JP” Jong Pil of the Korean chamber of commerce also graced the event at the 17th-century neoclassic and Spanish stone-and-brick church. The National Museum of the Philippines declared Pampan-ga’s oldest church as an Important Cultural Property in 2013.  

A green-colored hot-air balloon, bearing the name of the Lubao mu-nicipal government, was displayed at the church compound. It was showcased to the visitors by Lubao balloon festival event organizers Noel Castro Jr. and Steve Kim.

The delegation also visited the municipal hall, material recovery fa-cility, public market,  Pradera Verde (to fly hot-air balloons) in Lubao, Amare Oxford Hotel, Clark Museum, Nayong Pilipino, Puning’s Hot Spring and Matam-ih in Clark.

Lubao sets up ties with SoKor county to improve services

L EONORA SALVANE, an en-gineer from Bohol, was re-cently recognized by several

institutions and the Philippine In-stitute of Chemical Engineers in cooperation with the Professional Regulation Commission as an out-standing professional in 2015.

She was cited for her exemplary professional and social-civic con-tributions to society and the pro-fession of Chemical Engineering. She was also recently made the GT Cosmetics founder and chief operating officer.

Recently, she was honored as Grand Chamber Countryside En-trepreneur of the Year by the Cebu Chamber of Commerce and Industry in Cebu City.

A chemical engineer graduate from the University of San Carlos in Cebu, attributes her success to God. “I prayed hard for a business where I can practice my profession as a chemical engineer and share busi-ness ideas with the poor in my com-munity. The name of my business GT means God’s Talent,” she said.

Salvane started her business with an initial capitalization of P500 in 1995. Together with her family, they manufactured the soap in the kitchen using a baking pan.

Outstanding Professional of 2015 shares knowledge with the poor

By VG Cabuag

DAVAO CITY—Mass-housing developer 8990 Holdings Inc. said it acquired a property from

the Iñigo family that would become the company’s fifth development in Davao City.

Monday, July 6, 2015

OpinionBusinessMirrorA10

World War III with a peneditorial

FROM Europe to the extreme southern outpost of South America and around Southeast Asia, the world is at war. World War II was fought between two groups of countries. On one side

were the Axis powers, including Germany, Italy and Japan. On the other side were the Allies, led by the United States of America and the United Kingdom. However, by 1945, almost every sovereign nation on earth had declared a legal war against nations of either the Axis or the Allies.

Carl von Clausewitz was a Prussian general and military theorist who lived and wrote in the early 19 century, his most notable work being Vom Kriege (On War), on the philosophy of war. While the Chinese general Sun Tzu’s treatise The Art of War might be considered a “how-to” book, von Clausewitz’s was more of a “why” book.

There have been many misinterpretations of von Clausewitz, primarily because of his dialectical method of writing, which is almost a conversation between two people of opposing views. But many of his basic statements are simple to understand. He wrote, “War, therefore, is an act of violence to compel our opponent to fulfill our will” and “War is merely the continu-ation of policy by other means.”

While the use of armed force is still common today, civilization has “ad-vanced” using the pen as often as the sword.

Russia annexed Crimea with the justification of a vote of the people asking for inclusion in Russian Federation. In 1982 the UK and Argentina fought a 74-day war over the Falkland Islands, with nearly 1,000 killed. Two weeks ago, an Argentinian judge ordered the seizure of assets of oil-drilling companies operating in the disputed Falkland Islands.

The Philippines and China are at “war” over territory in the waters off our country, but it will first be fought at the Permanent Court of Arbitra-tion in The Hague.

Greece is at war with the government of the European Union (EU), and its allies at the International Monetary Fund and the European Central Bank over who will control the Greek economy and to keep Greece from leaving the EU.

The EU has not marched troops into the streets of Athens nor has China taken direct military action against the Philippines yet. But many of the other aspects of an armed conflict are already in place. Greek playwright Aeschylus wrote 2,500 years ago, “In war, truth is the first casualty.” Pro-paganda is an instrument of war.

The EU is bombarding Greece with warnings of economic Armageddon if Greeks do not capitulate to EU demands. China calls the Philippines a “cute little submissive” of the US, and its reclaimed islands are nothing more than solar-powered installations for “maritime search and rescue, and environmental conservation and scientific research.”

These are dangerous times, even if bullets are not flying and bombs are not falling.

THE Philippine Charity Sweepstakes Office (PCSO) continues its distribution of ambulances to recipients from all over the country.

PCSO distributes ambulances nationwide

On June 16 PCSO Chairman Eri-neo S. Maliksi turned over an ambu-lance each to to the municipalities of Tantangan, South Cotabato, and Anda, Bohol.

On June 18 we released an am-bulance each to the West Visayas State University Medical Center in Jaro, Iloilo, and to the municipality of Liliw, Laguna.

On June 19 PCSO Director Bem Noel traveled to the Leyte Provin-cial Capitol in Tacloban City to turn over 39 ambulances to one city, 37 municipalities and one association in the provinces of Leyte, South-ern Leyte, Samar, Eastern Samar and Biliran.

On June 29 we turned over six in Mindanao to the municipal governments of Piagpo, Maguing and Binidayan, Lanao del Sur; Maigo and Culambugan, Lanao del Norte; and President Roxas in North Cotabato.

On the same day, three mu-nicipalities in Luzon also received

ambulances: Santo Tomas, Batan-gas; Burgos, Ilocos Sur; and Sas-muan, Pampanga.

The PCSO Ambulance Donation Program provides ambulances to local government units (LGUs) and institutions on either a 60-40 cost-sharing scheme or outright dona-tion, depending on certain criteria. Each recipient may request for a new ambulance every five years.

One of the agency’s goals is to eventually provide every city and municipality, with an ambulance for the emergency needs of residents, especially those in remote areas far from hospitals or health centers.

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ON the medical and health-care front, among other related initia-tives, the PCSO held on June 24 a medical and dental mission, in cooperation with the A Teacher Par-tylist group in SB Compound, Que-zon City, for around 300 patients.

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MEANWHILE, the Branch Opera-

tions Sector of the PCSO continues to lower agency operating costs, even as it expands public access to its services by transferring existing and opening new branches in spaces given or lent rent-free by local gov-ernment units.

The branches slated for transfer soon are the Albay branch, to an office at the Albay Capitol Annex, Legazpi City; the Laguna branch to Alonte Sports Arena, Biñan; and the Rizal branch to the Municipal Compound, Cainta.

With the opening of a new branch in Antique in the third week of July, the PCSO will have 47 branches na-tionwide, from an initial 25, when the present board of directors as-sumed office in 2010. The PCSO is working toward opening a branch in every province over the medium to long term.

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CONGRATULATIONS to the con-nections of filly Skyway, longshot winner of the PCSO Silver Cup held on June 21 at Metroturf Race-course in Malvar, Batangas.

Sk y way, the least favored among the nine entries in the race, outran her opponents over 1,800 meters. We were pleased to award trophies to the representative of her registered owner, Deemark International, and to jockey Vir-gilio M. Camañero Jr. and trainer Anthony Francisco.

The PCSO maintains a racing- sponsorship program in line with

its charter, Republic Act 1169. The next race on its calendar will be held on July 25 at Santa Ana Park in Naic, Cavite.

The recipient of the charity proceeds of the race was the Presi-dent Elpidio Quirino Foundation, represented at the awarding cer-emony by Quirino’s granddaugh-ter and PEQ Foundation head Cory Quirino and other members of the family.

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THE PEQ Foundation is commem-orating the late President’s 125th birth year by supporting programs in education, environment and eco-nomic development.

The cause of education was es-pecially significant for President Quirino and still is for his family today because, unknown to many, he served as a barrio schoolteacher while attending Vigan High School.

He later obtained a law degree from the University of the Philip-pines and was one of the topnotch-ers of the Bar examination of 1915.

According to Cory, herself a celeb-rity and advocate of health and well-ness, the foundation will be holding throughout this year the “Quirino at 125” lectures and the “Teacher Happy Healthy Day” event series, among other activities.

Atty. Jose Ferdinand M. Rojas II is vice chairman and general manager of the Philippine Charity Sweepstakes Office.

RISING SUNAtty. Jose Ferdinand M. Rojas II

CAN Ronald Reagan save Japan from a debt crisis? We’re about to find out, as Prime Minister Shinzo Abe bets the remaining years of his mandate on the former US president’s

economic philosophy.

Reaganomics won’t save Japan

Abe’s new plan to curb Japan’s debt burden, the world’s heaviest at almost 250 percent of gross domes-tic product, doesn’t mention Reagan. But it’s impossible not to notice the influence of his widely touted theory that healthy government finances require, above all, a thriving corpo-rate sector. That should worry inves-tors, credit-rating companies and the Japanese people alike.

Abe did announce some vague in-tentions to cap spending and reach a budget surplus in fiscal 2020. But the heart of his strategy for deal-ing with government debt is stok-ing broader economic growth. It’s a questionable strategy, one that’s even more dubious, because of where Abe expects this debt-erasing out-put to come from: giant companies

profiting from a weaker yen and a “productivity revolution.”

Unfortunately, Abe’s plan is based on the discredited notion that more money for companies and the wealthy will mean more money for govern-ment coffers. Japanese companies have been earning more money since at least 2012, when the yen began dropping to the benefit of exports. But, instead of sharing the wealth by fattening paychecks, executives hoarded it. The amount of cash and deposits corporate Japan has on hand jumped 3.6 percent in March to a record $1.96 trillion. In 26 of the 30 months Abe has been in of-fice, CEOs have chosen to save extra cash rather than deploy it.

Abe shouldn’t expect much growth to trickle down from productivity

gains either. Japan’s insular and out-dated business practices have long made it a laggard among developed nations. That was less problematic before China’s ascendance in the re-gion. Japan is now an aging, ineffi-cient and wildly expensive property in a cheap neighborhood. In order to sustain its living standards, Japan needs to innovate and develop new job-creating industries (think renew-able energy, not cars and televisions). But as Georges Desvaux of McKinsey argues in a recent report, Abe has done very little since taking office to invest in Japan’s vast human capital.

Abe’s vague hopes to cut corpo-rate taxes, strengthen government and private-sector cooperation on technological innovation, and use the 2020 Tokyo Olympics to accel-erate reform don’t add up to a seri-ous economic plan. “Many of these proposals are fragmentary and it could be several years before bu-reaucrats and advisory councils are able to draft more concrete policies,” Tobias Harris of Teneo Intelligence says. “It may also take longer for the proposals to be translated into law.” And Abe doesn’t even mention the biggest contributor to Japan’s debt problem—its shrinking population.

Even worse, Abe suggests he has already initiated his boldest step

to improve Japanese productivity: The corporate governance code that went into effect on June 1. The idea is that the new rules will put CEOs under pressure to invest in tech-nology, equipment and training that will boost national growth. And that might be true—if much of the code weren’t voluntary.

The bottom line is that there’s little “new” about a plan that relies on growth to pay down debt. Reagan never managed to pull it off in the 1980s—US debt actually rose, belying the theory that tax cuts pay for themselves.

If Abe doesn’t rethink his ap-proach, and develop a plan to cut wasteful spending and find new revenue sources, things are sure to get worse for Japan. “If the Abe Cabinet, which continues to wield significant, albeit diminishing, po-litical capital, can’t make politically difficult fiscal decisions now,” Har-ris says, “it’s far from guaranteed that this government or its succes-sors will have an easier time.”

Japan has been trying to grow its way back to a credit rating of AAA for decades now. As Abe gives it yet an-other try by relying on trickle-down economics, it’s fair to wonder why history’s lessons haven’t yet trickled down to him.

HOM

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BLOOMBERG VIEWWilliam Pesek

Monday, July 6, 2015

OpinionA11BusinessMirroropinion@businessmirror.com.ph

Guarding the (corporation’s) guardians

IDEALLY, when a stockholder invests in a corporation, he does so expecting management to handle corporate affairs with utmost honesty and in good faith. It is only natural, for he now owns a

piece of corporate property and would, therefore, seek to reap his share of the profits from the corporation. Our Corporation Code recognizes this need, and gives the stockholder avenues through which he can ensure management’s compliance.

One such avenue is the right to inspect the corporation’s books and records. It is accorded such impor-tance in the Corporation Code that in Sections 74 and 144 thereof, the law even penalizes the refusal to al-low the inspection of a corporation’s books or records. The sanctions are severe—one may be fined or impris-oned for up to five years or, if com-mitted by the corporation, the very life of the corporation is at stake, as it is a cause for dissolution.

The stockholders, hence, are not mere investors—they are the corpo-ration’s guardians. In an ideal world, these guardians would use the rights provided under the law to allow the corporation to grow, and to reap in the just benefits of that growth. This is, of course, not an ideal world. Man is known to use and abuse his rights. Understanding this inherent weak-ness, the Corporation Code itself grants the corporation protection against abusive stockholders—Jus-tice Biden, in Republic v. Sandigan-bayan, recognized that the corpora-tion may use as a defense “that the person demanding to examine and copy excerpts from the corporation’s records and minutes has (1) improp-erly used any information secured through any prior examination of the records or minutes of such cor-poration or of any other corporation, or (2) was not acting in good faith or for a legitimate purpose in making his demand.”

Ang-Abaya v. Ang presents us with a stockholder who used this awesome right for all the wrong purposes. Edu-ardo Ang, the person in question in the case, was a shareholder of two of his family’s corporations, Vibelle Manufacturing Corp. and Genato Investments Inc. His relatives previ-ously filed a civil case against him and several other persons for allegedly conniving to wrest control of their operations. He borrowed money with-out intending to pay for it, demanded for increases in his monthly allow-ance and cash advances contrary to policies, attempted to kick out a fel-low officer, and many other acts det-rimental to the business. While this was going on, he sought permission to inspect the company books, but the other officers (petitioners in the present case) refused, arguing that he

would use the information obtained for purposes inimical to the corpora-tion—at the time, he was bullying the others into writing off millions of un-lawful personal advances, demand-ing that he be given an office already occupied by an officer, usurping the corporation’s exclusive rights, and coercing the rest of the corporation to give in to his baseless demands. Unsurprisingly, the corporation re-fused. Unperturbed, Eduardo sued the petitioners in the case for criminal violations under the said Section 74.

The petitioners denied Eduardo’s allegations, blaming Eduardo’s lav-ish lifestyle as the root of all his de-mands. They then parried Michael’s legal assault all the way to the Depart-ment of Justice, where it was found that there was lack of probable cause to support Eduardo’s allegations of violations of Section 74 of the Cor-poration Code, but the Court of Ap-peals (CA) reversed the Department of Justice, finding otherwise.

The Supreme Court, speaking through Justice Ynares-Santiago, reversed the CA. It held that the de-fense of improper use or motive is in the nature of a justifying circum-stance that would exonerate those who raise and are able to prove the same, and where the corporation de-nies inspection on the ground of im-proper motive or purpose, the burden of proof is taken from the shareholder and placed on the corporation.

The corporation’s defense met that burden. They presented official and other documents, such as board resolutions, treasurer’s affidavits and Eduardo’s own words, and proved the defenses they have been alleging since the lower court. Eduardo was even silent, withholding his objections to the charges against him. Taken together, the Supreme Court found that Eduardo was not acting in good faith and for a legitimate purpose in making his demands for inspection of company books.

In fine, stockholders, as among the guardians of the corporation, have the right to inspect corporate books. This right is not absolute, for the cor-poration may present the defense of improper use and motive in denying such inspection. The same law that gave rise to the guardian also gave rise to that who will guard the guardians.

A strategy of governance for the next 6 years

In the Philippines it has been conservatively estimated that one-fifth of the national budget is lost to corruption every year. Put another way, in every six-year presidential term, the country actually operates on less than five years’ funding. Although the actual figure can be debated, the amount is staggering, and Filipi-nos are literally dying as a result.

Every administration cam-paigns against corruption, but every administration ends up tolerating some degree of it as unavoidable. This fatalistic mind-set needs to change. Corruption cannot be accepted as an inevita-ble result of low salary, or as the work of a few “bad apples.” To be honest, it takes more than a few bad apples to steal 20 percent of the national budget.

Corruption is endemic; it is widespread; it is common. It is an interwoven part of the Philippine government “system.”

It’s only natural that the Phil-ippine government, and Filipinos themselves, would want to down-play the degree of this embarrass-ing problem, by citing similar is-sues in other countries, or again by attributing it to bad apples, but in reality, this only makes corrup-tion easier to tolerate. Openly and publicly acknowledging the true depth of the problem will drive fundamental changes in the war on corruption.

The first step in an effective anticorruption campaign is to confront the problem head-on, by acknowledging how widespread it truly is, and then by declaring an absolute zero-tolerance policy: “Corruption is a threat to national security, as great as any military threat. It starves our citizens and robs them of vital services. Corruption is not a victimless crime. Corruption kills, and cor-rupt officials are criminals, no different than pickpockets and drug dealers. Corruption is not a temptation, or a result of low sal-ary or difficult circumstances; it is a choice. And this government will no longer tolerate it, in any amount, at any level.”

And then government needs to go to war.

There are two primary ways to attack corruption of a scale like that found in the Philippines. The first is by eliminating “red tape.” This refers to any administrative procedure that serves no practi-cal purpose. In many cases, these steps are intentionally imple-mented as obstacles, “toll gates” which can be passed only after payment of a “fee.” This includes delays in processing, the need for multiple signatures or approvals, and the demand for documents or “requirements.”

To reduce red tape, government should conduct a nationwide pro-gram of “process improvement,” to review and justify the steps involved in providing all gov-ernment services, in all offices, at all levels. This review should be done with full transparency, to ensure public oversight, and should subject procedures for all government services to a strict set of criteria. Any step that does not provide practical value must be removed. In a matter of months, government services at all levels can be made more efficient, and opportunities for corruption less-

THE BROWN PLATFORMMICHAEL BROWN

A state of lawlessness exists in some of these distant areas simply because government operates outwardly rather than in parallel. Like a large room illuminated by a single lamp, the country is filled with shadows and dark spots. And those shadows are usually filled with all sorts of vermin, including some in government service. Much better to evenly distribute rows of lightbulbs, which bathe each part of the room with the same amount of light. It is much harder for corruption and lawlessness to prosper when there are no shadows to hide in.

CENTRAL banks and sovereign wealth funds are one of the most significant investor groups in global financial markets today—rivaling institutional investors, like

pension funds and insurers, as to their size. Central banks alone (excluding sovereign wealth funds) manage around $12 trillion of assets—a decent amount of money by anyone’s standards.

The amount of reserves under management has grown dramati-cally over the course of the last quarter-century, and, of course, much of the increase in sovereign reserve accumulation has taken place in Asian economies. Sover-eign reserves are the “elephant in the room” for financial markets—a large, powerful bloc of funds that has the potential to influence vari-ous financial markets.

Traditional ly, central bank

reserves were held to manage cur-rency values and global trade. To-day, however, foreign-exchange reserves are 10 times the level that they were in 1990; meanwhile, global trade is three times the level it was in 1990. The fact that reserve accumulation has outstripped the growth of trade by so large a mar-gin suggests that the traditional motives for holding reserves have altered. Partly, this is due to the Asian crisis in the late 1990s. The

lack of foreign-exchange reserves forced Asian governments to ap-ply for assistance from the Inter-national Monetary Fund (IMF) and, of course, the IMF dictated strict fiscal conditions before the aid was forthcoming. By in-creasing reserve holdings, policy-makers could lessen the risk of a future crisis and more important lessen the risk of supranational organizations imposing domes-tic-policy conditions that might be unpalatable.

The 2008 global financial cri-sis only reinforced the desirabil-ity of holding additional foreign-exchange reserves. Central banks were called upon to provide cash to the domestic economy—acting as what economists refer to as “lend-ers of last resort.” The point was that in this crisis the cash that was needed was not necessarily local currency, but increasingly international currency. Holding foreign-exchange reserves to help finance the private sector, and trade finance, became part of the role of central-bank reserves.

The consequence of this is that sovereign reserves have become an extremely important part of the global investment commu-nity. Now, however, things are starting to shift. The future for sovereign reserves looks some-what different to the past. One reason is that central banks are accumulating reserves at a slower pace. The current-account sur-pluses of fixed and quasifixed exchange-rate economies have fallen in recent years, and that means that there is less of a need for central banks to intervene to stabilize their currencies. China is a notable instance of this.

Bond and equity f lows into fixed and quasifixed exchange-rate economies have also slowed (at least relative to gross domes-tic product), and this, too, re-duces the need to intervene and acquire new reserves. Without the current-account and capital-account motive for currency inter-vention, the rapid pace of reserve accumulation that was a feature of global financial markets for

most of this century seems to be have moderated.

In theory the slower pace of reserve accumulation should re-duce the relative importance of sovereign reserves to global fi-nancial markets. However, this has happened at a time when the yields on government bonds are very low. Government bonds are a major part of central-bank portfolios and the lower return that is now earned on this asset class is causing some sovereign fund managers to look at alterna-tive assets as a way of improving their investment performance. Diversifying into a wider range of assets means that sovereign re-serve managers will become more important investors in markets where they have hitherto played a more limited role.

Two different assets, in particu-lar, seem to have been attracting more attention by sovereign fund managers recently. One is the Chinese renminbi. Interest in the Chinese currency has increased because of the possibility that

the IMF will make the renminbi part of the basket of currencies that form the Special Drawing Rights (the IMF’s international currency unit).

The other is inflation-protect-ed government bonds, perhaps reflecting central-bank concerns about the perceived risks of global central-bank policies that re-main generally accommodative. Because of the size of existing sovereign reserve funds, even if these funds cease to grow in the way that they have done in the re-cent past, the possibility of port-folio diversification means that investors need to pay attention. This is particularly the case in the Asian region, which (along with the Middle East) is home to many of the largest sovereign reserve managers. Investors cannot af-ford to ignore the behavior of the sovereign elephant in the room.

Paul Donovan is senior global econ-omist at UBS AG. For a web version of the article, visit www.ubs.com/pauldonovan.

The investment elephant in the room

PAuL DONOvAN

LEgALLy sPEAkINgAtty. Lorna Patajo-kapunan

Second of three parts

IN its 1972 report on widespread corruption in the New York City Police Department, the Knapp Commission said: “A high command unwilling to admit that the problem of

corruption is extensive cannot very well argue that drastic changes are necessary to deal with the problem.”

ened considerably, through this program.

The second way to attack cor-ruption is to radically strength-en the government’s auditing, investigation and prosecution agencies.

Justified by the declaration that corruption is a threat to na-tional security, the fight against it should be given the same prior-ity as national defense. The Om-budsman, Sandiganbayan and the Commission on Audit should be budgeted, manned, and equipped on a level nearly equal to the police and military. This will certainly require a significant realignment of budgetary priorities, to fund technologica l modernization, salaries for an army of inspectors, and even court costs for prosecut-ing corrupt officials, but in real-ity, it makes sound fiscal sense.

Unlike law enforcement and defense, anticorruption agencies can actually save government money. The amount of taxpayer money lost through corruption and waste in the Philippines is staggering, but if a significant port ion can be recovered by spending more money, govern-ment would actually realize a gain rather than an expense. The return on this investment, in the form of a “clean house dividend” will be greater than any other project the government will ever undertake.

In addition, radically increas-ing the size of the various anti-corruption agencies would create tens of thousands of new jobs for accountants, data-entry workers, computer technicians and many others. In fact, it’s likely that the effort could employ every gradu-ating accountant for the next sev-eral years.

There is no “down side” to an ag-gressive anticorruption campaign.

One Philippines, One Standard IN developed countries, the na-tional government can be seen and felt with the same presence in all parts of the country, regardless of distance or remoteness. In the United States, for example, no one refers to California, or even Alaska or Hawaii, as “outlying states.” No one calls Okinawa or Hokkaido the “hinterlands” of Japan.

In the Philippines, though, gov-ernment radiates outwardly from the national capital, decreasing in visibility and effectiveness the farther one travels from Manila. Although it may be slowly chang-ing, many Filipinos consider it a fact of life that they have to travel all the way to Metro Ma-nila to obtain some government services, and that “Imperial Ma-nila” captures more than its fair share of government attention and resources.

A state of lawlessness exists in some of these distant areas sim-ply because government operates outwardly rather than in parallel. Like a large room illuminated by a single lamp, the country is filled with shadows and dark spots. And those shadows are usually filled with all sorts of vermin, including some in government service. Much better to evenly distribute rows of light bulbs which bathe each part of the room with the same amount of light. It is much harder for corruption and lawlessness to prosper when there are no shadows to hide in.

This is a major source of pub-lic discontent, and is the reason anti-government and criminal elements continue to thrive in those areas. They fill the void left by an absent or weak government.

To be truly effective and to truly serve the entire population, the national government must be seen and felt in a standardized form throughout the country. Every service available in Metro Manila must be available in all parts of the country, in equal form and equal quality.

In the United States every state capital, and most major cities, have a “ federal building” in which all national govern-ment agencies hold office. Ev-ery national service is available in these offices, in equal form, quality and speed. The Philip-pine government should imple-ment this, as well, at the very least in every provincial capital. A citizen requesting any govern-ment service should be able to get it just as fast in Negros as in Manila. Government service and inf luence must be delivered, and felt, in exactly the same way across the entire country.

Along with services, govern-ment obligations must be car-ried out in the provinces with the same vigor and quality as in the capital. Road repair, educa-tion and, most important, law enforcement must be conducted in exactly the same way in ev-ery part of the country. A police station in Patikul, Sulu must be similarly equipped and must fol-low the same procedures as one in Makati. This means they must wear the same uniform, fill out the same reports and offer the same services, in accordance with the same laws. We need to elimi-nate the word, and the concept of, “remote” from the national discussion.

To be concluded

Michael Brown has lived over 16 years in the Philippines. He writes on English, traffic management, law enforcement, and more recently, gov-ernment. Follow him on Twitter at @M_i_c_h_a_e_l

Meanwhile, the Bangko Sentral ng Pilipinas (BSP) said the crisis in Greece should have no significant effect on the flow of remittances, as Greece-originated remittances account for only a small part of total earnings that migrant Filipino work-ers send home regularly.  “When it comes to remittances, Greece is not really a major source and most Filipino workers are seafarers in vessels that are of Greek registry,” BSP Governor Amando M. Tetangco Jr. told reporters. He quickly added that in the past, whenever remittancess were threat-ened by developments in the host countries, Filipinos always manage to find jobs in neighboring countries within the same area or region. “So we don’t believe this is going to be significant in terms of the ef-fect on remittances,” Tetangco said. Earlier, the BSP governor said the country’s macroeconomic fun-damentals—including sufficiently deep international reserves and ro-bust spending by the national gov-ernment—should help shield the local financial markets from bouts of volatility. Right now, Tetangco said the BSP is keenly observing developments re-lated to the Greek referendum whose

impact has bearing on talks between the European Union (EU) and Greece. “That is why we continue to monitor how the different markets are doing and how they all respond or react to all these developments,” Tetangco said. “Just like other countries, we have to assess how that will af-fect the talks between the EU and Greece, the EU and other creditors, on one hand, and Greece on the other hand,” he added. Meanwhile, Tetangco expressed optimism on the continued growth of the economy no matter the low output results in the first months of only 5.2 percent. “We believe that the economy continues to be strong, that there are drivers of growth. That monetary situation is such that there [is] suf-ficient liquidity in the system and interest rates continue to be in his-toric lows,” Tetangco said. “So based on that and consider-ing the statement of the government that itº going to accelerate govern-ment spending, the Monetary Board was on the view that there is no need for additional monetary stimulus at this time because there is enough li-quidity, interest rates are low. Those who need funds can access funding through the banking system or the capital markets,” he added. 

AP, Bianca Cuaresma

A12

2ndFront PageBusinessMirror

www.businessmirror.com.phMonday, July 6, 2015

Continued from A1

Greece vote: 2 choices, many possible results

Gaisano, HK firm to develop waterfront township in Cebu

Economistssee Juneinflation at 1.5 percent

By Bianca Cuaresma 

How low can inflation go? Lower than the record-low inflation print in May this year, economists said.

Consumer prices in June were seen de-celerating further from 1.7 percent in May, as lower prices in key food items, coupled with statistical base effects, continue to pull inflation down this year. Economists said inflation in June could slow to 1.5 percent based on forecasts by six economists polled by the BusinessMirror. Inflation at this level is lower than the 1.7-percent inflation print in May, the low-est in 20 years, according to the Philippine Statistics Authority (PSA). The forecast was anchored on benign prices of food that account for more than half of the consumer price index (CPI), as well as on lower energy prices and on so-called favorable base impact. Bank of the Philippine Islands econo-mist Nicholas Mapa—who forecast infla-tion averaging 1.4 percent in June—said slower inflation in the basket-heavy food component and a rate adjustment in utili-ties were seen as the main drivers of the forecast. “we could see inflation continue to be below 2 percent in the near term on base effects [inflation peaked in August 2014]. If you recall, food inflation spiked in mid-2014 on the back of higher food prices [rice prices, in particular] on tight supply,” Mapa added. This view finds support from ING Bank Manila economist Joey Cuyegkeng, who also said inflation should average 1.4 per-cent in June. “Softer energy rates and prices, mod-erate price pressures on major food items more than offset education-related rate increases,” Cuyegkeng said. Cuyegkeng also said the assump-tion that inflation will average 2 per-cent for 2015 is subject to possible downward revision. Standard Chartered economist Jeff Ng also said inflation was likely dragged lower by the high base effects on food prices last year at the height of the congestion prob-lem at the Port of Manila. He forecast infla-tion in June averaging 1.6 percent. Mean-while, Security Bank economist Patrick Ella said inflation will likely hit 1.4 percent on the back of a weak peso for the month. First Metro Investments Corp. Treasury Head and Senior Vice President Reynaldo Montalbo Jr., meanhwhile, sees inflation averaging 1.5 percent, while Singapore-based bank DBS Bank economist Gundy Cahyadi sees inflation at 1.8 percent. “At this juncture, the central bank seems to be in a pretty good place—GDP [gross domestic product] growth momen-tum remains strong while CPI inflation is well within the comfort zone. There is no reason to shift policy stance for now. But watch the core inflation number going forward as it has been trending down in recent months,” Cahyadi said. All forecasts are within the central bank’s official forecast for the month rang-ing 1.1 percent to 2 percent.

HOUSE PANEL SETTO LOOK INTO FAKERICE PROLIFERATION

By Jovee Marie N. dela Cruz & Butch Fernandez

THE chairman of the House of Representatives Committee on Trade and Industry is set

to file this week a resolution to in-vestigate the claims of several rice dealers that fake and poisonous rice is proliferating in Mindanao. Nacionalista Party Rep. Mark A. Villar of Las Piñas City, chairman of the panel, made the statement af-ter rice dealers in the region voiced their concerns to him. “I will file a resolution [this week] and we are eyeing to start the inves-tigation in the last week of July or in August. As we go around in some markets in [Mindanao] the autho-rized rice dealers there said that the cases of fake rice are increasing and this is very dangerous,” Villar said in a radio interview. He added that the panel will invite officials from the Bureau of Customs, the National Food Au-thority (NFA), the Department of Agriculture, as well as rice dealers in Mindanao to the panel’s hearing. Villar said the government should strengthen its monitoring system against the fake rice, which is re-portedly made out of potato, sweet potato and plastic resin, and asked the NFA to regularly inspect the lo-cal markets to prevent the entry and distribution of fake rice in the region. “The government should also conduct an awareness campaign for the benefit of the public,” he added. Villar said that although the fake rice is not yet reported in other areas, the public should im-mediately report to the authorities if they find any rice retailer selling the commodity. “As of now, [the cases of fake rice are only] limited in Mindanao. That’s why as early as now, we should solve this problem and find the dealer of the fake rice before it reaches other areas in the Philippines,” he said. Villar said that he believes that fake rice may have come from the im-ported or the smuggled rice supplies.

According to the NFA the al-leged synthetic rice samples found in Davao contained dibutyl phtalate, a chemical used as plasticizer. Meanwhile, the NFA, in a news report, said that in buying rice, con-sumers should take note of the color and quality of the grains. The agency said that rice grains usually differ in sizes, and are not shiny or too white. “If the rice grains are uniform in size, are too white and are shiny, chances are these grains were ma-chine-made,” the NFA said. The NFA added that buyers are also advised to smell the grains before buying, saying rice grains should not smell like plastic. Also one should also check wheth-er there is a layer of plastic on top of the cooked rice, the agency said. Malacañang on Sunday advised consumers to buy only from autho-rized rice dealers even as the Palace moved to allay concerns over the toxic “plasticizer” contaminated rice supply reportedly being sold in local markets. Communications Secretary Her-minio B. Coloma Jr. confirmed over the weekend that President Aquino had already given specific instruc-tions to Justice Secretary Leila de Lima and Interior Secretary Manuel A. Roxas II to track down the source of the “fake synthetic rice” and confis-cate the poisonous supply to protect unwitting consumers. He advised consumers, as a pre-caution, to buy their rice supply only from authorized rice dealers and rice outlets accredited by the NFA. Coloma added that Presidential Assistant for Food Security and Ag-ricultural Modernization Secretary Francis Pangilinan was also ordered by Mr. Aquino to conduct a parallel inquiry on how the toxic rice supply was brought into the country and identify the perpetrators. At the same time, he said Presi-dent Aquino is also awaiting a full report on laboratory tests con-ducted on samples of the toxic rice supply earlier seized from local markets. With a report from Recto Mercene

‘No Bio, No Boto’ A Commission on Elections officer takes a woman’s biometrics data at the satellite voters’ biometrics registration booth at SM North Edsa. Voters troop to SM malls at the start of the three-monthlong voters’ biometrics registration period. NONOY LACZA

By Catherine n. Pillas

Metro Gaisano’s real-estate arm, taft Properties, bared plans to build a 20-hectare

waterfront township in Cebu, in partnership with Hongkong Land, a regional real-estate developer and investment firm. “This partnership will help jump-start Mandaue City’s trans-formation into a dynamic lifestyle

hub,” said Jack Gaisano, chairman of Taft Properties. “With Taft Properties’s local

expertise and Hongkong Land’s in-ternational experience, this alliance will bring in new standards in design and construction that will keep and preserve the local culture and tastes,” Gaisano added. “A portion of the development will be allotted for open spaces, such as a central linear park, al-fresco establishments and a waterfront promenade. Culturally sensitive commercial and recreational devel-opment will bring economic and civic vitality to the area,” Tan Wee Hsien, Hongkong Land head of residential property for South Asia, said in the same statement. Taft Properties is part of Vicsal Development Corp. of the Gaisa-

no group, which also operates the  Metro and Pacific Mall chain.  Hongkong Land is one of Asia’s leading property investment, man-agement and development groups. The firm owns and manages almost 800,000 square meters of prime office and luxury retail prop-erties in key Asian cities, principally in Hong Kong and Singapore.  Hongkong Land is also develop-ing a number of residential projects in cities across Greater China and in Southeast Asia.  The company’s assets and invest-ments are managed from Hong Kong by Hongkong Land Ltd. Hongkong Land is a member of the Jardine Matheson Group.

Thermal Energy Corp. in Batangas; and the 82 MW of Anda Power Corp. in Pampanga. The first 150 MW of SMC Consolidated Power Corp.’s power project in Limay, Bataan, will be avail-able by 2016. By 2017 SMC’s second 150-MW unit will be made available in January, while the 420 MW of Pagbilao Energy Corp. in Quezon will be ready by No-vember. In Mindanao, Sarangani En-ergy Corp.’s 200-MW coal plant will be commercially available by Novem-ber this year and Therma South Inc.’s second 150-MW unit by June. FDC Utilities Inc.’s 3x135-MW plant in Misamis Oriental and SMC’s 2x150-MW in Davao del Sur are ex-pected to be fired up in 2016. By 2017 GN Power Kauswa-gan Ltd. Co.’s 540 MW in La-nao del Norte and Minergy Coal Corp.’s  3x55 MW in Misamis Orien-tal will be commercially available. In the Visayas, there is only one coal power project that will be put up. Palm Concepcion Power Corp.’s 2x135-MW power facility in Iloilo will be available in 2016. Many power firms generate power from coal because it is the cheapest among all power sources. By 2020 former Energy Secretary Carlos Jericho L. Petilla had said that some 23 new coal-fired power plants will be up and running. “If you look at the cost, coal is the cheapest.  But you just don’t want to have the cheapest. You need to have reliability and self-sufficient power source. Moreover, you have to take into consideration the health and en-vironmental factors. The end-goal is to have a fuel mix that does not only

take into account the price alone,” Petilla said. Energy think tank and global con-sultancy IHS noted the importance of coal as a reliable source of genera-tion. However, overreliance on coal can result in health impacts, and risk of unmet power demand associated with economic loss arising from proj-ects delay. “If the coal projects are imple-mented as planned, Luzon’s coal-gen-eration share will be over 75 percent by 2030, and many coal plants will be uneconomic,” IHS warned. Ideal fuel mixIN the same DOE data, natural gas-fed power plants are next to coal, while the remaining capacity will come from oil-based power plants and power facilities that will utilize renewable energy, such as hydro, so-lar, wind and biomass. Based on DOE’s Private Sector Ini-tiated Power Projects, there are 1,150 MW of capacity to be generated from natural-gas plants, all from Luzon. Energy Wind Corp. targets to put up a 600-MW powerplant in Pagbilao, Quezon, in November 2017 that will cost $300 million. First Gen Corp.’s Prime Meridian PowerGen Corp.  is ready to fire up its 100-MW San Gabriel Avion power plant in Batangas in September this year. The project costs P10 billion. First NatGas Power Corp.’s 450-MW San Gabriel power plant Phase II will be put up also in Batangas by June 2016. It costs $600 million. The country’s only producing gas field, Malampaya, is expected to run out of gas by 2024.

Sen. Sergio Osmeña III, chairman of the House Committee on Energy, said the private sector and the gov-ernment must work as early as now to ensure the stable supply of gas. “I am telling you now that we have to resolve our natural-gas infrastruc-ture. We are going to run out of gas, so what do we do with the 2,700-MW gas-fired power plants now being fu-eled by Malampaya?” he pointed out. Pilipinas Shell Petroleum Corp. and First Gen have announced plans to import liquefied natural gas (LNG) from other countries and build their respective LNG import facilities.  LNG is a  natural gas that has been converted into a liquid state for easier storage and transportation. Upon reaching its destination, LNG is regasified so it can be distributed through pipelines as natural gas.  IHS strongly believes that LNG plays a critical role in achieving the balanced fuel mix. “With LNG im-ports, economic and health benefits can be mitigated, share of gas in generation trends up to 30 percent in 2030,” it said.  The DOE  is pushing for a 1/3 rule: 30 percent for coal; 30 percent for gas; and 30 percent for renewable energy and the rest will be for other technolo-gies. This is meant to promote a more diverse source of electricity in the Philippines by reducing the country’s reliance on coal-fired power plants.  IHS thus urged the Philippine government to deliver a sound, transparent and workable policy framework to meet the objectives of a reliable, secure, sustainable and cost-effective fuel mix outcome in the power sector.

49 power projects ready by 2019. . . Continued from A1