Monday, June 17, 2013 Riseandshinewith thePhilippines · 2014-10-14 · roled in school. President Aquino and his “boss” have much to celebrate despite the ongoing chal-lenges

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The South China Sea has beena certain bone of contention be-tween the Philippines, Chinaand their ASEAN neighbors fora number of decades. The rea-son for the territorial dispute issimple: much of the trade be-tween Europe, the Middle Eastand Asia passes through thesewaters, acting as a crucial in-ternational shipping lane.

Perhaps more importantly,there are thought to be vast oiland natural gas reserves in thearea which are primed for eco-nomic development, chieflyexplaining why this particularmaritime boundary is so hot-ly contested.

Scarborough Shoal – little

more than 100 miles from thePhilippines and 500 miles fromChina – is the stretch of reefwhich the two countries lay

overlapping claims to. Now, af-ter years of attempting to re-solve the issue diplomatically,the Philippines has decided totake China to a UN tribunal inan effort to settle things onceand for all.

Despite China’s refusal to takepart in the proceedings, Philip-pine Ambassador to the U.S.Jose L. Cuisia, Jr., believes theirfailure to reach an agreementidentifies a legal route as the on-ly way forward.

“We have of course made itclear to China, as well as theU.S., that this arbitration is apeaceful means of settling thedispute” says Mr. Cuisia.

“The tribunal should be able

to settle issues that will clarifynot just our own territory, butalso the territorial boundaries ofother countries, using the UNLaw of the Sea as the Basis.”

While the Philippines and theASEAN nations are simultane-ously pushing for a code of con-duct, which they hope willlikewise help put an end to thenumerous disputes in the SouthChina Sea that have long ham-pered multilateral relations inthe region, the U.S. has also ex-pressed its support for UN in-volvement, although wishing toremain neutral with regard toany particular country’s claims.

Aside to their encouragementfor a quick and lawful resolution

to the Philippines-China situa-tion, the United States’ pivot toAsia, a strategy to strengthenU.S. military partnershipsthroughout the Indo-Pacific re-gion, has led to a big improve-ment in relations with thePhilippines in the areas of de-fense, and beyond.

“The relations between theU.S. and the Philippines havenever been better than they aretoday,” remarks AmbassadorCuisia. We of course stand to

benefit [from the pivot] in thatwe are a treaty ally of the U.S.and have a strong military andsecurity alliance.”

With the announcementthat 60% of the U.S. Navy Fleetwill be deployed to Asia by2020, the significant number ofextra troops is expected tobring broad benefits to thePhilippines, not just instrengthening naval capabili-ties, but boosting the country’seconomy as a whole.

The current Presi-dent of the Philip-pines Benigno S.Aquino III, son ofwell-loved former

president Corazon Aquino,has been steadfast in his cam-paign to serve his real “boss”,the people of the Philippines.Curtailed corruption, im-proved transparency, eco-nomic growth, welfareprograms, peace talks with lo-cal rebel groups, job creation,and infrastructure develop-ment are key points on theagenda that President Aquinohas actively pursued since be-ing elected in 2010.

After years of practically un-controlled corruption in thePhilippines, he certainly hashis work set out for him; how-ever, he views corruption erad-ication as key to solvinganother pressing problem.

“I was put into office by thepeople who believed in myidea that corruption is the rootof poverty; that an end to cor-ruption would mean an endto poverty,” he said in 2010.

A few months later, he ex-panded on this idea, saying:“The time for patronage is over.Now is the age of profession-alism, meritocracy, and gov-ernment institutions that arecommitted to the people… Wewill leave a country less poor,easier to invest in, and wherepeople trust their governmentand all of its entities to workfor their interests.”

Perhaps due to its recent in-stability, the Philippines haslagged behind its neighbors interms of foreign investment.From 2000 to 2011, FDI onlytotaled $25.59 billion. In con-trast, Malaysia attracted$114.56 billion and Thailand,$146.12 billion. Nevertheless,this is set to change owing tothe country having achievedtwo investment grades fromFitch Ratings and Standard &Poor’s – a sign that PresidentAquino’s efforts are paying off.

GDP growth has been in theblack throughout his term,with 7.6% in 2010, 3.9% in 2011and again a strong 6.6% lastyear (placing it at the forefrontof economic growth in South-east Asia). The economy hasremained strong throughoutthe global recession, mainlydue to its low dependence onexports, its huge remittancesfrom 4 to 5 million overseas

Filipino workers that in turnlead to strong domestic con-sumption, a rapidly expand-ing business process outs-ourcing (BPO) industry, andminimal exposure to troubledinternational securities.

Presently, the Philippines’economy is the world’s 46th

largest. By 2018 it’s forecast-ed to rank 31st.

Not all is rosy, however. Un-employment stands at 7%,while underemployment inalmost 20%. Moreover, it’s es-timated that over 40% of em-ployed Filipinos work in theinformal sector. And with a

median age of 22, the work-ing-age population is grow-ing at a rapid rate, while jobcreation remains low still.

The Aquino administrationhas earmarked large sums forinfrastructure (an area itwould like to see further de-veloped under the public-pri-vate partnership program) aswell as for social programs,namely in health and educa-tion.

One of the government’smost successful social pro-tection schemes to date isPantawid Pamilya, or FamilySubsistence, piloted in 2007.

Currently, 3 million poorhouseholds receive smallmonthly grants for keepingtheir children healthy and en-roled in school.

President Aquino and his“boss” have much to celebratedespite the ongoing chal-lenges inherent in a fast-grow-ing emerging marketeconomy. In July 2012, he il-lustrated his administration’ssuccess.

“These past two years, wehave proven that, as a nation,we can make possible whatwas once thought of as im-possible. For example, at a

time when economies allaround the world face greatuncertainty, ours thrives. Boththe investor market and ourpeople are working with anewfound confidence that hasled us from success to suc-cess. And we have done thisdespite the significant deficitwe inherited, and withoutraising taxes.

“These past two years, wehave also breathed new lifeinto the idea that governmentis there to work for its people.We have focused on fulfillingour mandate to uplift thecommon Filipino by spend-

ing significant portions of ourbudget on social services –most prominently ourPantawid Pamilya Program,which is helping 3 millionhouseholds from sinking fur-ther into poverty, and is giv-ing them the resources to liftthemselves out of their situ-ations. We are giving theirchildren the chance at prop-er education. We are requir-ing them to see medicalprofessionals for regularcheck-ups. In short, govern-ment is finally giving our peo-ple what they rightfullydeserve.”

Our WorldMonday, June 17, 2013See

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EDITOR IN CHIEF: ALBERTO LEANDRO LLARYORA

#PhilippinesWorldfolio

AA UUNNIITTEEDD WWOORRLLDDSSUUPPPPLLEEMMEENNTT PPRROODDUUCCEEDD BBYY:: Fatima Ruiz, Enrique Abascal and Chantal Hesp

Economic growth is strong, social programs successful, and transparency improved.The Philippines is becoming more than just a picture-perfect vacation spot

President Benigno Aquino III has traveled to Washington twice (in September 2011 and in July 2012) to meet with President Obama and other world leaders

The Philippines has decided to take China to a UN arbitral tribunal to resolve a territorial dispute in the South China Sea, a move that many countries unbiasedly support

Navigating through the proper channels

Ambassador of the Philippines to the U.S. Jose L. Cuisia, Jr.

Rise and shine withthe Philippines

ig PHILIPPINES USAT.qxd 7/6/13 17:58 Página 1


Distributed by USA TODAYMonday, June 17, 2013 THE PHILIPPINES2

The first upgrade came onMarch 27 from Fitch, and Stan-dard & Poor’s followed just overa month later, lifting the Philip-pines out of the junk bond sta-tus and placing it among theworld’s elite 70 nations deemedsuitable for business, wheregovernment and the privatesector both are capable of pay-ing their obligations. Ultimately,this translates into lower bor-rowing costs and, of course,higher investor confidence.

Thanks to robust GDPgrowth, the number of bankloans has increased, while as-set quality has improved, saysthe report.

In early May, after receivingthe second upgrade, FinanceSecretary Cesar Purisima said,“We are very pleased that S&P,along with Fitch, has also nowaffirmed the Philippines’ strongeconomic and fiscal gains.”

“This investment grade rat-ing is another resoundingvote of confidence on thePhilippines and an affirma-tion of what the markets al-

ready recognize – that oureconomy’s underlying sound-ness is on par with countriesrated investment grade orhigher,” he added.

Governor of Bangko Sentralng Pilipinas (BSP), the country’scentral bank, Amando Tetang-co Jr. said the S&P decision “ce-ments the Philippines’ status asan economy with one of thebrightest prospects globally.”

S&P cited the country’s fis-cal flexibility, healthy forexbuffer, resilient remittances andmanageable inflation as rea-sons for the upgrade.

Actual investments over theshort to medium term wouldmaterialize, he said, and helpthe country boost foreign di-rect investment (FDI).

“With our investment graderating, we are more confidentthat these inflows, particu-larly of more FDIs, will swingtoward increasing the coun-try ’s productive capacity,thereby generating more em-ployment and higher in-comes,” said Mr. Tetangco.

After enjoying GDP growthof 6.6% in 2012, the governmenthopes the investment grade willattract funding to the tune of$17 billion for infrastructuredevelopment, which in turnwould boost growth to as muchas 7% in 2013.

The third global creditwatcher, Moody’s is yet to up-grade the Philippines to in-vestment grade. Currently, itstands at one notch below(Ba1) with a stable outlook.Nevertheless, Mr. Purisimaholds that the market ratesthe country “at least twonotches above investmentgrade and based on Moody’sown bond implied ratings, weare among the most under-rated countries by Moody’s.”

He adds that he is confidentMoody’s will soon add a thirdstar to the Philippines’ record,especially since a recentMoody’s Analytics report stat-ed that “the Philippines hasbeen among the brightestparts of a generally gloomyglobal picture.”

For their part, Philippinebanks are also enjoying re-silience and the benefits of agrowing economy. An S&P re-port published earlier this yearpredicted that bank loanswould carry on growing at adouble-digit rate in 2013, af-ter having grown approxi-mately 10.7% last year.

Aside from their tradition-al roles in the financial sector,banks in the Philippines alsoplay a key part in maintain-

ing a strong economy, as theyare the official entry pointsfor the billions of dollars senthome from overseas Filipinoworkers (OFWs).

From January to March thisyear, remittances topped $5.1billion, up 5.6% over the sameperiod in 2012. Estimatesfrom BSP show that BDOUnibank Inc. leads the bank-ing sector in remittances, cap-turing 27.8% of the total in2012. Bank of the PhilippineIslands (BPI) came in a closesecond with 25%, whilePhilippine National Bank(PNB), Metropolitan Bank &Trust Co. (Metrobank) andRizal Commercial BankingCorp. (RCBC) accounted formarket shares of 15%, 11%and 6%, respectively.

Thanks to the increasingskills levels of Filipino work-ers, especially in the health-care sector, salaries are onthe rise, as are remittances,which grew 6.3% to $21.39in 2012. This figure repre-sents around 10% of thecountry’s entire GDP.

The largest source countryby far is the United States, ac-counting for 42.6% of total re-mittances, followed byCanada at 8.2%, Saudi Arabiaat 7.9%, the U.K. at 5.7% andthe UAE, with 4.5%. Gulfcountries have of late in-creased their share, as manyof the traditionally strongereconomies of the West arestill recovering from the eco-nomic recession.

Founded in 1851 and based inMakati, BPI is the oldest bank inSoutheast Asia and the largestreceiver of overseas Filipinoworker (OFW) remittances. Itsoperations fall into three mainsegments: consumer banking,corporate banking, and invest-ment banking. It is also heavilyinvolved in micro-enterprisedevelopment and encouragingFilipinos to work under theirown initiative.

Having served as the Presi-dent and CEO of BPI since 2005,Aurelio Montinola III receiveda standing ovation from BPIinvestors and executives aftergiving his retirement speech inApril and formally passing thereins on to his successor, CezarConsing, at the Annual Stock-holders Meeting.

According to BPI’s Chairman,Jaime Augusto Zobel de Ayala:“Over the past eight years underMr. Montinola, BPI delivereddouble-digit compoundedannual growth rates (CAGR)amidst many macroeconomicchallenges and changes in thebanking industry landscape: 10%CAGR on resources from P529billion to P985 billion ($12.9bn-$24bn), 10% CAGR on revenues

from P28 billion to P47 billion,and 12% CAGR on net incomefrom P8.4 billion to P16.3 bil-lion.

“BPI’s average return on equitywas 14.5% during the past eightyears, while total return to share-holders over the same periodwas at 214%. Our share priceended 2012 at P95 for a year-end market cap of P338 billion,the highest among the banks onthe PSE in 2012.”

PPrrooggrreessss tthhrroouugghh tteeaammwwoorrkkMr. Montinola has long been afirm proponent of achievingresults through teamwork andexpanding the business organi-cally. During his tenure at thehelm, Mr. Montinola oversawvarious acquisitions by the Ayala-owned bank – including thoseof Prudential Bank and ING’sinvestment unit – and grew BPIto become the third largest bankin the country by assets.

“We always check the busi-ness model in an area and thenwe always try to improve the cus-tomer experience and to get peo-ple to work together,” says theformer CEO.

“So we have a statement: ‘Ifyou focus on the customers and

the employees, the businessresults will follow.’ My own pref-erence for organic growth is thatI feel it’s easier to handle, and thebank’s acquisitions are good fromtime to time. The advantage oforganic growth is that you see

what the market opportunitiesare. You are able to mobilize yourresources and then you can moveforward.”

In the 1980s, BPI focused onits consumer banking arm. Itthen turned its attentions to the

overseas market during the 90s,and the following decade it tar-geted small and medium-sizedenterprises (SMEs).

Management at the bank nowhave a greater BPI presence inAsia in their sights and are alsoexperimenting with micro-finance. Mr. Montinola adds:“BPI is a steady improver. Maybein terms of satisfaction, we at BPIhave helped the banking indus-try in the country become oneof the best in the world today.”

BBPPII FFoouunnddaattiioonnThe corporate social responsi-bility initiatives at the bank arehandled by the BPI Foundation.Established in 1978, its programsand activities are based aroundimproving Philippine life in threecore areas: entrepreneurship,education and the environment.Its drive to take a more activerole in strengthening the capa-bilities of the nation’s entrepre-neurs led BPI to be the firstcommercial bank to supportmicrofinance institutions (MFIs)through the provision of devel-opmental loans.

To help create a vibrant SMEsector, the foundation conductslearning sessions on basic finan-

cial and credit management,which are held in key citiesnationwide through half-dayteach-ins with financial expertsfrom the bank along with theparticipation of the Departmentof Trade and Industry.

The foundation has also col-laborated with the Institutefor Social Entrepreneurshipin Asia (ISEA), a learningaction network of socialresource institutions andsocial enterprises aimed atstrengthening the capacities ofsocial entrepreneurs. Such ini-tiatives fall right in line withthe bank’s affirmation that “thelife we want does not dependon what we have. It’s what wedo with what we have.”

In education, BPI invests invarious programs that promoteacademic excellence as well asefforts to uplift the quality ofeducation.

BPI adopts the attitudethat the responsible use ofresources is the key towardssustainability. So by helpingprotect the environment andpreserving Philippine her-itage through the arts, BPIis helping secure the futureof the next generation.

Highly respected and widely regarded as one of the best banks in the Philippines, the Bank of the Philippine Islands, BPI, has received a multitude of awards and blazednumerous firsts in the country’s banking industry that have been designed to support entrepreneurism and spur socio-economic development through private-sector enterprise

Double-digit growth at BPI

Former President and CEO of BPI, Aurelio Montinola

Amando Tetangco Jr.,Governor of theCentral Bank (BSP)

A new era forbusiness and

investment in thePhilippines has

arrived, thanks toFitch Ratings andS&P having lifted

the country’scredit rating to

investment grade(BBB-) with a

stable outlook

Two investmentgrades secured



Distributed by USA TODAY Monday, June 17, 2013 3THE PHILIPPINES

For over a decade, the Asia-Pacific region has beenregarded as the world’sdynamic economy and thisyear’s investment grades fromStandard & Poor’s and FitchRatings prove that the Philip-pines is no exception.

In 2012, the Philippinesexceeded market expectationswith a GDP growth of 6.6%thereby reaffirming what ana-lysts say about the country beingAsia’s sweet spot for investors.

The Philippines boasts ofhaving the youngest popula-tion in the region and with a sig-nificant part of the workforcebeing highly educated and flu-ent in English, the country is agoldmine for investors, espe-cially in outsourcing.

The local banking industryis thriving as increased stabil-ity means confidence is ridinghigh. Banks are recording highgrowth and are well positionedto take on international com-petition. In fact, seven Philip-pine banks are featured in theTop 1,000 World Banks 2012rankings compiled by TheBanker magazine from theFinancial Times. Leading thecharge of the country’s top per-formers is the MetropolitanBank & Trust Company,known as Metrobank.

Buoyed by business and con-sumer confidence, Metrobankregistered a net income ofP15.4 billion ($377 million) in2012 for a 40% increase over theP11 billion recorded in 2011.Metrobank assets breached theP1-trillion mark, ending theyear with P1.04 trillion ($25.5billion) in total resources. Thebank’s growth was supportedby the 8% hike in deposits toP738.7 billion which in turnfueled the 15% expansion innet loans and receivables toP525.7 billion.

Metrobank remains to be adequately capitalized.Metrobank reported totalequity of P120.0bn and totalcapital adequacy ratio of 16.3%with Tier 1 CAR at 13.7%.

TThhee eennttrreepprreenneeuurriiaall bbaannkkeerrEstablished in 1962 and head-quartered in Makati City, thebank was founded by theChairman of MetrobankGroup, George S.K. Ty.

“Banks at that time werevery conservative and as ayoung entrepreneur, I had dif-ficulty in getting funds to com-plete our family’s flour mill,”recalls Mr. Ty.

Backed by his entrepre-neurial expertise and a diffi-cult experience in gettingfinancial support from banks,he then envisioned to put uphis own bank.

“Had it not been for onestate-owned bank, I would notbe able to get enough capital tofund our family business. Fromthen on, I was determined thatthere should be a bank thatwould lend support to busi-nessmen and the community,”says the bank’s founder.

“It was very difficult. I nevergave up. That’s why Metrobankbecame a reality.

“Fifty years ago, the bank-ing scene in the country wasdifferent. I started somethingthat was more unique com-pared to other banks. Backthen our competition werewell established banks thathad been in operation formore than 75 years.

“But from the very start, Ihumbled myself. I made surethat I earned the trust of ourcustomers; I ensured that eachand every Metrobanker towsthe line of trust and credibility.”

Although he comes from afamily of Chinese migrants, Mr.

Ty considers himself very mucha Filipino. As his way of givingback to his second home, hemade sure that Metrobank notonly catered to Chinese busi-nessmen, but especially to theFilipino people.

Metrobank expanded itsreach early on by establishingbranches in the countrysideand slowly inched its way tothe global scene to cater to Fil-ipinos wherever they are inthe world.

AA ffllaaggsshhiipp bbaannkkToday, Metrobank is the coun-try’s premier universal bankand has the largest consoli-dated domestic network ofover 828 branches and 1,760

automated teller machines(ATMs) all over the archipel-ago. It also has 34 foreignbranches, subsidiaries and rep-resentative offices around theworld in cities such as NewYork, Chicago, Madrid, Rome,Tokyo, Seoul and Hong Kong.

In 2012, Euromoney maga-zine named Metrobank the‘Best Bank in The Philippines’for the third consecutive year.

It has demonstrated a capa-bility to excel not only in bank-ing, but it also has considerablestakes in real estate, power gen-eration, life insurance, hospi-tality and the automotiveindustry.

Aside from providing bank-ing products and services,

Metrobank has been consid-ered as one of the institutionsin the Philippine bankingindustry having one of themost stringent risk manage-ment policies, procedures andstandards, which have, in turn,made the bank more stableand secure.

Another key focus ofMetrobank that contributedto its success is its emphasison enduring banking rela-tionships.

“We established Metrobankto be a customer-focused insti-tution that is responsive to theneeds and concerns of its stake-holders” says Mr. Ty.

This client-centric approachhas been very evident andeffective as some of the com-pany’s key clients have beenwith them for years, some evenas long as the bank has been inexistence.

CCoorrppoorraattee cciittiizzeennsshhiippAccording to the founder and group chairman, sinceMetrobank was established halfa century ago, there has alwaysbeen a thrust towards enablingits stakeholders. At first, it wasto provide financial access tosustain the business growth ofentrepreneurs, but the bankhas since expanded this focusonto various programs thatbuild capacity and provideincentives to key groups in soci-ety that are crucial to nationaldevelopment.

From the outset, Mr. Ty hasstated that trust is a funda-mental component of any bankand as part of Metrobank’soperations, he would set up afoundation so he could giveback to the people and serve thecommunity.

“You have to convince peo-ple, one way or the other thatyou are honest, trustworthy,

kind hearted, and a good per-son, especially as a banker,” hesays. “So we set up a founda-tion to show this. And trueenough, when people talkabout Metrobank, people saywe are proper businessmen,not just ones trying to makemoney. So this foundation tome is not just a foundation,but also a good sense of whowe are.”

In 1979, the MetrobankFoundation was established toimplement social developmentprojects in the Philippinesfocusing on education, visualarts and healthcare.

“The foundation’s programsembody our commitment to aculture of excellence, a meansof empowering Filipinos thatallows them to inspire and pos-itively influence their peers andconstituents,” says Mr. Ty.

As the heart and soul of theMetrobank Group of Compa-nies, the foundation is a help-ing hand in nurturing a cultureof excellence, and its philan-thropic arm in contributing tohuman well-being.

As the company looks for-ward to banking in the Philip-pines for another 50 years, Mr.Ty shares his vision forMetrobank.

“Regardless of what techno-logical innovations or retail-based changes occur in theindustry, a bank must retainthe very reason for its existence:public trust. We must, above all,continue to advocate that abank is entrusted with a per-son’s hard-earned money.”

Mr. Ty adds, “We envision aMetrobank that continues tocater to the next generation ofour tenured customers – a bankthat is trusted by generationsof families, entrepreneurs andbusinessmen to take care oftheir banking needs.”

Metrobank is one of the Philippines’ most successful banks, while staying true to its brand promise of “You’re in Good Hands”

A trusted flagship in Philippine banking

George S.K. Ty, Chairman of Metrobank




When Benigno Aquino III be-came the 15th President of thePhilippines in June 2010 thecountry entered into a state ofsocioeconomic and politicalstability. Since then the econo-my of this Asian archipelagohas been strong with early signsindicating a steady growth forthe foreseeable future.

The economy of the Philip-pines is currently ranked as the40th largest in the world ac-cording to statistics released bythe International MonetaryFund in 2012, when it was alsorecognised as one of the emerg-ing markets of the world.

As a newly industrializedcountry, the economy of thePhilippines has been steadilytransitioning from an agricul-tural economy to one basedmore on services, manufactur-ing and, most importantly, theprivate sector. The estimatedgross domestic product (GDP)for the Philippines in 2012 wasover $424 billion. According toAmerican multinational in-vestment banking firm, Gold-man Sachs, by the year 2050the Philippines will be the 14th

largest economy in the world. The firm has previously in-

cluded the Philippines in theNext 11, a projected list of the11 countries with the highestpotential of becoming theworld’s largest economies in the21st century. British multina-tional banking and financial ser-vices organization HSBC hasalso projected strong growthfor the Filipino economy, withtheir figures indicating that bythe year 2050 the economy ofthe Philippines will be the 16th

largest in the world, fifth largestin Asia and largest in the South-East Asian region.

Together with Indonesia andVietnam, the Philippines formsthe Asian VIP (Vietnam, In-donesia, Philippines) market,

an area which is proving to beincreasingly attractive for privatesector investors. According toToshihiko Takamoto, the LeadManager of the DIAM VIP Fo-cus Fund, these areas are at-tractive for a number of reasons.

“To begin with, they havelarge populations. Indonesia has230 million people, the Philip-pines 83 million and Vietnamnearly 80 million. On top of that,the average age is low, under 25,so you have a large, young andcheap labor force,” he says.

The well known economistthen went on to talk about thepotential for international in-

vestors, stating, “In the VIP mar-kets, the influx of investmentfrom overseas, which is indis-pensable for economic growth,has quickly grown in recentyears. If the accumulation ofcapital continues in this way,an even longer period of growthcan be expected.”

Mr. Takamoto finished bycomparing the VIP market tothe giants of Asian economy.“We expect these markets tofollow a similar growth path toChina and India. GDP per capi-ta is very low still, in the rangeof $700-$1,700 across the threeeconomies. VIP’s GDP per

capita is approximately thesame as Japan when it was dur-ing its high-growth period, andVIP is only in the initial stagesof growth.”

The Philippines is surpris-ingly accessible for foreign in-vestors, with both Filipino andEnglish languages used offi-cially. Mr. Takamoto believesthe abundant human resourceswill support the continuedgrowth of business process out-sourcing (BPO) in areas suchas IT services and call centers.There is also an abundance ofengineers with the Philippinesproducing the largest annual

number of graduates (50,000)from science and engineeringuniversities out of all countriesin the Association of South-east Asian Nations (ASEAN).

Investment from the privatesector has played an importantrole in the continued socio-economic development of thePhilippines.

Family holding companiessuch as Ayala Group, Yucheng-co Group, SM InvestmentsCorporation, Lopez Group,DMCI Holdings, Metro Pacif-ic Investments, Aboitiz Cor-poration, Robinsons LandCorporation, JG Summit Hold-

ings Inc., and countless othershave all contributed towardsthe redevelopment and con-tinued growth of the Philip-pines on a social, political andeconomic level. These compa-nies, and others, have becomeexamples of successful entre-preneurship and innovationwithin the Filipino population.

Large multinational corpo-rations have also played a partin the complete redevelopmentof the country. Companies suchas San Miguel, Jollibee, InsularLife, Megaworld, Rustan’s,Bench, Century Properties, BPI,Metrobank, Vista Land andmany more have become am-bassadors within the economyof the Philippines, opening thedoors for other large multina-tionals by showing them thepotential that lies within the Fil-ipino economy.

Personally appointed by Pres-ident Aquino in 2012, ArsenioBalisacan is the current Secre-tary of Socioeconomic Plan-ning of the Philippines. FormerDean of the University of thePhilippines School of Eco-nomics, Mr. Balisacan has be-come a key player in thecontinued growth and stabili-ty of the Filipino economy.

However, Secretary Bal-isacan is concerned not justwith growth and stability, butwith the distribution of wealthand the responsibility of gov-ernment to ensure the devel-opment of the Philippines asa whole.

A recent statement from theSecretary reveals the aims setout by President Aquino: “Cer-tainly, the Philippine economyis growing, but we need to makeit grow faster and to sustainhigh growth for the long term.There is also no question thatwe need the growth to be moreinclusive, across and within sec-tors and areas of the country.”

The private sector as the engine for economic growth

The Philippine Veterans Bank(PVB) was first conceived in1956, after a reparations agree-ment as part of a peace treatyhad been signed with Japan. Aportion of the $20 million pro-vided by Japan, which invad-ed the archipelago in 1941during World War II, was putinto a trust fund for veteransof the war.

This fund was eventuallyused in 1963 by the VeteransFederation of the Philippines toestablish the PVB. The bankwas born out of a deep senseof social responsibility towardsthe Philippines’ WWII veter-ans, as a symbol of gratitudeand reverence. Its vision: to en-sure, through its growth andprofits, that veterans – as wellas their widows, orphans andheirs – were provided with ad-equate care and a good quali-ty of life, through healthcare,pensions and other provisions.

Of PVB’s profits, 20% is setaside for the bank’s Board ofTrustees. The board in turn in-vests this money in projects orinvestments deemed advanta-geous to the interest and wel-fare of veterans.

In recent years, the bank hasbeen growing from strength tostrength, in tandem with thecountry’s economy. Between2001 and 2011, it managed toincrease the value of its assetsfrom P14 billion ($345 million)to P57 billion.

PVB is a successful, yet smallbank. That is why in recentyears, it has shifted its focusfrom corporate lending to lo-cal government unit lending(LGU) to support local devel-opment projects. Now, between30% and 40% of its loan port-folio is comprised of LGU loans.

“Outside of the two govern-ment-owned commercialbanks, nobody is really lookingat the needs of local govern-ment. PVB positions itself as aviable alternative bank to these

two – rendering efficient ser-vice and competitive productsthat are adaptable and recep-tive to their developmentneeds,” CEO and President ofPVB Ricardo A. Balbido states.

“The needs of LGUs are verysuitable to the size of resourcesthat we can invest for them,”he adds.

It is in this market niche thatthe bank found a place where itcould support the developmentof the Philippine economy; its

lending to LGUs has helped toevolve infrastructure projects,transport terminals and otherdevelopments.

There are two unique char-acteristics of the bank that dis-tinguish it from othercommercial banks in the coun-try. First is the fact that it canaccept government deposits, aprivilege that was bestowedupon it in its original charter.Through this, the bank built astrong relationship with gov-ernmental agencies.

“Since we can accept gov-ernment deposits, a good num-ber of government agenciesand LGUs have supported us,”adds Mr. Balbido.

The second unique trait ofthe bank is that it is owned,and can only ever be owned,by the veterans, their widowsor descendents. Therefore itis, essentially, a “closed-endequity bank.”

Entrusted with caring for the financial welfare of veterans and their descendents, PVBhas also become an important local partner in development

Veterans Bank, banking for a cause

Ricardo A. Balbido, CEO and President of Philippine Veterans Bank (PVB)

MANUEL V. PANGILINAN, Chairman ofthe Board of PLDT

TERESITA SY-COSON, Vice-Chairpersonof SM Investments Corporation

RAMON S. ANG, President and CEO ofPhilippines Airlines and President andCOO of San Miguel Corporation

JAIME AUGUSTO ZOBEL DE AYALA,Chairman and CEO of AyalaCorporation

AS OF SEPTEMBER2012, VETERANSBANK HADALREADY LENT OUTP7 BILLION ($168 MILLION) TOLOCALGOVERNMENTUNITS, MAINLY FORINFRASTRUCTURE-RELATED PROJECTS

The Philippine private sector is reinforcing growth in an already healthy economy and foreign investors are taking increasing notice of the benefits of doing business in the archipelago

“THERE ARE ONLYTHREE THINGS THATARE IMPORTANT TOUS: FINANCIAL ANDMENTAL INTEGRITY,COMPETENCE, ANDPASSION. QUALITYDECISIONS AREMADE BY QUALITYPEOPLE. PEOPLEHAVE GOT TO HAVETHE DRIVE ANDDETERMINATION TOSUCCEED”

SM INVESTMENTSCORPORATION’SINFLUENCE ONPHILIPPINE SOCIETYAND ECONOMY ISUNIQUE, AND ITSDEDICATION TOCSR, FAMILIES ANDFREEDOM OFCHOICE MIRRORTHE MINDSET OFTHE NATION

“ONCE UPON ATIME WE USED TORELY ON THEMARKETS INEUROPE AND THEU.S. TO A GREATEREXTENT. IF YOULOOK AT THESTATISTICS OF THEPAST FIVE YEARS,ASIANECONOMIES ARETRADING WITHEACH OTHERMUCH MORE THANEVER BEFORE”

AS MUCH AS $8.5BILLION WILL BEINVESTED OVER THENEXT DECADE TORESTORE PHILIPPINEAIRLINES AS A TOPCARRIER IN THEREGION AND TO STEPUP SAN MIGUEL’STRANSFORMATIONINTO A MOREMODERN,INFRASTRUCTUREAND CONSUMERBASEDCONGLOMERATE




Established in 1900, Atlantic,Gulf & Pacific Company(AG&P) is synonymous withthe Philippines’ construction in-dustry, working across the en-gineering and constructionspectra on key projects rangingfrom the country’s first steelbridge, Manila’s water andsewage systems, a major con-vention center, skyscrapers andnational monuments.

In just over two years, NYC-born Joseph Sigelman, Chair-man of AG&P since 2010, hastransformed the 112-year giantinto the only Philippines-head-quartered multinational com-pany providing modularengineering, fabrication, mod-ular construction and asset sup-port services to the oil and gas,mining, power, and civil infra-structure sectors.

From 300 people working inthe company’s heavy fabrica-tion yards in December 2010,Mr. Sigelman has grownAG&P to a base of over 3,000people.

It is in its 150-hectarestate-of-the-art yards inBatangas, the largest heavy fab-rication yard in SoutheastAsia, where AG&P em-ployees make the com-pany’s modularconstruction, or“Modstruction”magic happen.

Going be-yond the tradi-tional steel andpipe definition ofmodularization,Modstruction is aholistic approach toglobal infrastructureprojects. The companyuses its vast knowledgeof modular fabricationto help customers plan,design, engineer, and con-struct large infrastructureprojects. It delivers andassembles the modules

where they are needed, performsoperation and maintenance ser-vices, and, ultimately, decom-missions and disassemblesmodules at the end of the theiruseful lives.

“AG&P’s Modstruction alsoallows for parallel processing atmultiple facilities so that pro-jects are finished faster than ina normal construction setting,where they are constrained bya linear progression. This meansthat our clients can drive revenuefrom projects far sooner thanwith traditional approaches,” ex-plains Mr. Sigelman.

AG&P modularizes infra-structure, some as large as sev-en stories tall and weighingthousands of tons, which leavethe fabrication yards for jobsites all over the world via

heavy-lift shipor container.

The com-pany issupport-ing thecountry’s

growth byt r a i n i n gand em-

ploying Fil-i p i n o s ,

driving international business toits local yards, and providing op-portunities for its people to gainexperience abroad through itsOverseas Manpower Division.

“Our obligation to the com-munity doesn’t stop at employ-ment in our yards. Education isthe most powerful way to in-fluence the future of the coun-try and our employees receiveongoing training to maximizetheir potential,” says Mr. Sigel-man, who adds that Filipinos ex-hibit “unrivalled passion anddedication to their work.”

“There is a Philippine flag fly-ing on top of some of the mostcomplex infrastructure projectsin the world,” he says. “Our em-ployees are proud to be a partof these projects and the impactthey are having on the reputa-tion of the Philippines the worldover.”

A man driven not by moneybut by the passion for making adifference and a meaningfulchange where it matters themost, Mr. Sigelman is revolu-tionizing how the constructionand infrastructure worlds dobusiness and at the same time,catapulting the Philippines on tothe global stage.

AG&P Chairman Joseph Sigelman has built and transformed start-ups in Latin America andIndia into large corporations, creating thousands of jobs. In 2010, he turned his attention tothe Philippines – one of the fastest growing emerging economies in Southeast Asia

AG&P: Leading the waywith ModstructionTM

“WE PARTNER WITH SOME OF THE LARGEST

MULTINATIONALCUSTOMERS ON CRITICAL

RESOURCE ANDINFRASTRUCTURE

PROJECTS ATHOME AND IN

NORTHAMERICA,

AUSTRALIA,SOUTHEAST ASIA,

LATIN AMERICA,EUROPE AND

AFRICA”

JOSEPH SIGELMANChairman of AG&P

The Philippines’ largest air con-ditioner manufacturer and dis-tributor is a family-run businesswith a vital North Americantie. In 1998, local firm Con-cepcion Industries, Inc. joinedforces with Carrier Corpora-tion to become Concepcion-Carrier Air Conditioning Co.(CCAC), the undisputed leaderin A/C, ventilation and heat-ing in the archipelago nation.

Raul Joseph Concepcion, athird generation CEO at CCAC,says that his family’s originalcompany had built up a solidreputation even before theunion, thanks to its good cus-tomer relations, a trait it’s main-tained through the 21st century.

“Our business has been com-mitted for 50 years because ourbusiness isn’t just about air-

conditioning, but rather, we arealso focused on dealing withpeople. Our mission is that‘we’re not just about air-condi-tioning – we’re about solutions.’We come in and we see how wecan help you create a healthyenvironment rather than justselling boxes and pieces of air-conditioning units.”

CCAC combines this deeplocal touch and knowledge witha U.S. business mentality to gar-ner a 45% market share and alarge portfolio of customersabroad who source their prod-ucts from them.

“Our American partnersbrought the discipline on howto manage our businesses andhow to look out for our finan-cials and fundamentals,” saysMr. Concepcion.

A Philippine-U.S. partnership leads the A/C industry in the Philippines

CCAC knows how to keep it cool

Construction industryexperts BCI Asia hailed2013 as the year thatwould see the “birth ofnew construction” in thePhilippines, predictingthat the value of the sec-tor would climb to around$27.7 billion, a staggering264% increase on 2012.

The boom is mainlydue to a surge in infra-structure and real estateprojects. For a countrythat has been criticizedfor a lack of public ex-penditure on infrastruc-ture, the Aquinoadministration has com-mitted $11 billion this year onports, airports, roads andbridges. The government isplanning to dig even deeper in-to the coffers over the comingyears, with infrastructure in-vestment set to jump to almost$17 billion by 2015.

The dense collection ofcranes that dominate Manila’sskyline is evidence of the coun-try’s thriving real estate sector.New office and residentialbuildings, shopping malls andhotels are sprouting up all overthe capital.

Socio-economic develop-ment has caused skyrocketingdemand for housing in recentyears. A surge in bank lendingto the Philippines’ real estatesector is indicative of the mar-ket’s potential in a favorableenvironment of low interestrates and strong economicgrowth. Demand for housingis not only coming from citi-zens, but also from expatriatesthat have come to work in thebustling country.

The knock on effect of this

construction boom on themanufacturing sector has beenstrongly felt by the country’s ce-ment manufacturers. The Cement Manufacturers’ As-sociation of the Philippines

says that demand for ce-ment grew 18% in 2012and is expected to grow10% this year.

Manufacturing overallis going through some-what of a “renaissance” inthe Philippines, accordingto renowned Filipinoeconomist, writer andthinker, Bernardo Villegas,and will see “an avalancheof investment this year,”with revenues forecastedto reach $1 billion.

A country that hasgrown out of its agricul-tural routes, the 7,000-island nation is home to

the world’s top car manufac-turers, such as Mercedes-Benz,BMW, Volvo, Ford, Toyota,Mitsubishi, Nissan, and Toy-ota. More evidence of the Fil-ipinos’ growing spendingpower and affluence came in2010, when sales of vehicleshit a record high of 162,000.

Electronics manufacturingalso plays a large part in theindustrial sector, which con-stitutes around 31.3% of GDP.The Philippines plays host totop multinational electronicfirms like Intel and Toshibaand can also boast of supply-ing 10% of the world’s semi-conductor manufacturingservices and produce 50% ofworld’s HD televisions.

Filipino exports are fore-casted to rise 10% to 17% thisyear, thanks mainly to a surgein outside demand for manu-factured goods, with electron-ics – making up of 40% exportrevenues – due to climb around10%, while machinery andtransport equipment exportswill grow 12%.

A rebirth and a renaissance: two words that have been tied to the Philippines’construction and industrial sectors this year

Construction andindustry reachnew heights

Raul Joseph Concepcion, CEO of CCACand grandson of the original founderof Concepcion Industries, Inc.

ROGELIO LAZO SINGSON, Secretary ofPublic Works and Highways

“WITH OUR PRUDENTUTILIZATION OFTAXPAYER MONEYAS WELL ASIMPROVEDPROCUREMENTPROCESSES ANDOPEN,TRANSPARENT,COMPETITIVEBIDDING AS OF DEC.31, WE WERE ABLETO SAVE OVER P12 BILLION WHICHCAN BE UTILIZEDFOR OTHER PRIORITYDEVELOPMENTPROJECTS”




Who better to head one ofthe Philippines’ largest con-struction and real estate con-glomerates than a formerconcrete inspector? DavidConsunji, now in his early 90s,made the transition from in-spector to entrepreneur, in amove that would literally al-ter the skyline of many of thecountry’s cities.

Between 1951 and 1995,Mr. Consunji’s constructionfirm DMC Consunji, Inc. En-gineers and Contractor (DM-CI), held steady operationsthat left in its wake dozens up-on dozens of satisfied clientsand successfully completedprojects. Young David hadmade a promise to his auntthat he would go out and be-come his own boss and makehis family proud.

“I promised her that I wouldwork with honesty and in-tegrity in running my ownbusiness,” he recalls. “Businessin beyond earning money. Wealways start with true service;that is what we stand for.”

His firm’s integrity certain-ly did not go unnoticed. In1979, Mr. Consunji wasnamed Outstanding Citizenof the City of Manila for En-gineering and was brought into government to serve asSecretary of Public Works,Transportation and Commu-nications.

In late 1995, DMCI wentpublicly listed on the Philip-pine Stock Exchange as DMCI Holdings, Inc. DMCIremained as the group’s con-struction subsidiary and wasjoined by DMCI Project De-velopers, Inc. (PDI), SemiraraMining Corporation, DMCIPower Corporation (DPC),DMCI Mining Corporation(DMC), DMCI-MPIC WaterCompany, Inc. (DMWCI), andmost recently, Sem-Calaca

Power Corporation (Sem-Calaca). In other words, Mr.Consunji cemented a smallempire of construction, realestate, mining, power, and wa-ter utility.

“Since DMCI became pub-lic, we have evolved into an in-frastructure company usingour competencies in engi-neering and construction. Forme, our direction towardsbusiness synergy has been re-alized,” he says.

The group’s wholly-ownedmining subsidiary is DMC,which is engaged in nickel,chromite and iron laterite ex-ploration and mining. How-ever, the real miningbreadwinner is Semirara,which enjoys a supply con-tract with the state-run Na-tional Power Corporation.

Semirara is the Philippines’largest coal producer, with ex-clusive rights to explore, mineand develop the coal re-sources on Semirara Island,a 13,600-acre island some 200miles south of Manila. Ac-cording to Mr. Consunji, coalmining accounts for 40% ofthe group’s net profit.

“Our coal production is at7 million metric tons (MMT)a year, of which we supply 2MMT to our own powerplant. Although the exportdemand is still robust, we pri-oritize servicing our localmarkets which commandhigher prices,” he says.

Indeed, Sem-Calaca Pow-er Corporation became an im-portant client two years agowhen the first of the two pow-er plants went online.

“We won in the bid for thetwo 300 MW power plants inCalaca, Batangas,” explains Mr.Consunji. “We finished reha-bilitating the first unit in 2011,which now runs at 250-300MW. The other unit – which

we just recently finished re-habilitating in the second halfof last year – is now in its test-run stage. Today, we can saythat we are indeed in the pow-er generation business. We arenot just putting up powerplants; we run them.”

DMCI Power Corporation,another 100% owned groupsubsidiary, is building theMasbate Diesel Power Plant,through which it will supplypower to the island of Mas-bate for 15 years, thanks to atender DMCI was awardedby the National Power Cor-poration.

DMCI’s Chairman says thatdiversifying one’s assets is asure way to guarantee a flowof income, hence his group’sinvestments in mining, ener-

gy and water. Nevertheless,building remains closest tohis heart. “The constructionbusiness in not only an occu-pation – it is a calling. Con-struction is a task with a hugesocial value, ethics and oblig-ation to clients,” he says.

Nicknamed ‘the father ofconstruction’ in the Philip-pines, Mr. Consunji nevercompromises quality.

“We provide quality homesto families who want decentand affordable houses to calltheir own. We put quality inall our projects; that is themost important thing for us,”he states. “We find ways toshorten and lighten con-struction works without sac-rificing quality. This results inbigger savings for our clients.”

Like his integrity, DMCI’sfocus on quality is a big sell-ing point. “We are happy tonote that we are one of thefastest growing real estatecompanies because of thepromise of quality and af-fordable housing that we of-fer,” adds Mr. Consunji.

Quality aside, however,DMCI is also renowned forits pioneering the usage of ad-vanced construction tech-nologies in the Philippines. Itwas one of the first companiesto use precast, pre-stressedand high-strength ready-mixed concrete, for example.

And, not only do projectsreceive DMCI’s hallmarkquality and innovation,they’re often completed aheadof schedule. In fact, it was this

attribute that sealed a suc-cessful future for Mr. Con-sunji’s venture; in 1951, hefinished a Coca-Cola plantfor Don Andres Soriano (ofthe family that established theSan Miguel brewery) nearlyhalf a year ahead of schedule.

Apart from residentialproperties – which are main-ly offered through DMCIHomes, a firm that by year-end 2011 had sold more than31,000 units worth some$1.45 billion – DMCI’s im-pressive portfolio includesAyala Triangle Tower I at thePhilippine Stock ExchangePlaza, the Citibank Tower, theSM Megamall, and Shangri-La’s Mactan Island Resort andHotel Manila, as well as thekilometer-long Magat Bridge,the Gibong Diversion Dam,the Narvacan Power Trans-mission Lines, and the threeinterchanges on Metro Mani-la’s main thoroughfare.

Other notable completedprojects are the San MiguelCorp. North Brewery, theMotorola Plant, the DingleDiesel Power Plant, and theU.S. Navy’s hangar in Subic,which is the largest contractthe U.S. government has everawarded to a Philippine con-tractor. All in all, DMCI hascompleted more than 500 var-ious projects to date, many ofwhich have been for repeatcustomers.

Nevertheless, for Mr. Con-sunji the group’s impressiveportfolio isn’t a mere list ofcompleted projects. “Ourachievements are not mea-sured by how many structureswe have built, but rather byhow many lives we havetouched. Beyond every struc-ture that we build, there is acompelling social value in-stilled by the hard work of ourmen in DCMI,” he concludes.

The “father of construction inthe Philippines” builds valueDavid Consunji set out in 1951 with a cement mixer and a truck. Today his group stands behind some of the country’s most important real estate, infrastructure and mining projects

“BUSINESS INBEYONDEARNINGMONEY. WEALWAYS STARTWITH TRUESERVICE; THAT ISWHAT WE STANDFOR”

“WE FIND WAYSTO SHORTENAND LIGHTENCONSTRUCTIONWORKS WITHOUTSACRIFICINGQUALITY. THISRESULTS INBIGGER SAVINGSFOR OURCLIENTS”

DAVID CONSUNJI, Founder and Chairman ofDCMI Holdings, Inc.




The Philippines is emerging asa major destination for globalmedical tourism and reputablesources suggest the achievablereturns from tapping into its fullpotential are set to be huge. Thecountry is rapidly becoming aninternational first choice forcombining healthcare and vaca-tions due to its world-class physi-cians, cutting-edge technology,high levels of widely spoken Eng-lish, and its uniquely Filipinobrand of caring and compassion– all at great value for moneyand a fraction of the cost in other,more developed countries.

In a study by healthcare busi-ness intelligence firm Health-Core, earnings from foreigntourists’ spending on health-care and wellness servicestotaled $1.3 billion from 2006 to2010. The report further revealsthat the country has the poten-tial to earn as much as $1 bil-lion annually by 2018 – or earlier– with strategic investment inhealthcare infrastructure.

“I believe today is the besttime to come; people shouldinvest when a business is grow-ing, not when it is fully grown,and the health sector today isgrowing,” says Dr. Edgardo R.

Cortez, President and CEO ofSt. Luke’s Medical Center. “Forinvestors to maximize theirprofit, it is important to investat the right time. If you go tooearly you will earn later, and ifyou go too late your margin willbe small. If you go at the righttime, like now in the Philippines,you can realize that your mar-gins will be the maximum youcould ever get.”

Considered one of the besthospitals in Asia, St. Luke’s Med-ical Center was founded in Que-zon City in 1903 and now has asecond hospital in Global City.Over the past century it hasgained a reputation for supe-rior healthcare service rooted infive pillars: high levels of pro-fessional expertise in its staff,state-of-the-art technology,guaranteed patient safety, excel-lent success rates, and passion-ate customer service.

“Medical tourism in thePhilippines is coming of age; weare ready. St. Luke’s MedicalCenter offers total care withcompassion, and the PatientsExperience Division stands fornot just curing, but caring,” saysMarilen Tronqued-Lagniton,Vice-President of the Patient

Experience Division, which wascreated when the hospitaldecided to get back to the basicsof care provision and reallylooked into what a patient needsto feel comfortable and safe.

“We also looked at the servicefive-star hotels give to theirguests and implemented thatin our hospital. We have a per-

sonal patient experience asso-ciate for our patients that is onstandby 24/7, as well as aconcierge and a pick-up servicefrom the airport.”

An insistence on the highestprofessional standards is integralto the hospital’s focus on mak-ing patients feel at ease whenfaced with medical treatment.

“Patients should come to St.Luke’s because here we promiseto give them the best treatmentin terms of healthcare. I call itstate-of-the-art healthcarethrough compassionate, effi-cient processes with good clin-ical outcomes and results. Andthis is what we deliver; we aremaking the patient as safe aspossible,” says Dr. Cortez.

The high standards at St.Luke’s have been recognizedinternationally. For example,last year it won its fourth con-secutive Reader’s DigestTrustedBrand Platinum Award, whichgoes to companies that scoredthree times or more than theirnearest rival. St. Luke’s in GlobalCity was also distinguished lastyear as being ranked 11th amongthe ‘25 Most Beautiful Hospitalsin the World’ by the editors ofU.S.-based Healthcare Man-agement News and Insights.

“Awards for us are secondary.Actually, in reality we do thingsright because that is the rightthing to do,” says Dr. Cortez.“We always want to improve sowe have a lot of activities tomake sure there is continuousinnovation in what we do.”

St Luke’s was the first hospi-

tal in the Philippines and thesecond in Asia to achieve inter-national accreditation by JointCommission International (JCI),a subsidiary of JCR, which is theglobal arm of JCAHO – the old-est and largest health careaccrediting body in the U.S. Dr.Cortez attributes the constantpush to raise standards with thelatest technology as a major fac-tor in gaining JCI approval.

True to form, St. Luke’s hasintroduced a breakthrough insurgical technology offering amore precise and less intrusiveway of doing surgery: roboticsurgery, which dramaticallyreduces recovery times.

Dr. Cortez adds, “We werealso the first to have PET andPET CT scans, which have fastbecome part of the usual diag-nostic procedures for cancer,protecting cancer spread andrecurrence.”

Success rates are high at St.Luke’s, being around 99.99% foropen-heart surgery, 37% to 45%for fertility treatments, and a68% cure rate regarding col-orectal cancer. “Expertise, tech-nology, well-trained staff: wepromote everything as a pack-age,” says the CEO.

Spearheading the country’s emergence as a leading destination for medical tourism in the Asia-Pacific region by providing advanced technology, lower costs and shorter waitingand recovery times, St. Luke’s Medical Center showcases the future of global healthcare with its cutting-edge medical equipment, world-class expertise and impeccable patient care

State-of-the-art healthcare

DR. EDGARDO R. CORTEZ,President and CEO of St. Luke’s Medical Center

MARILEN TRONQUED-LAGNITON,Vice-President of St. Luke’s MedicalCenter’s Patient Experience Division

With demand for power grow-ing but supply tight and priceshigh, the Aquino administra-tion knows that economicgrowth and national prosper-ity rests on the future devel-opment of the energy sector.

The 2009-2030 PhilippineEnergy Plan (PEP) is the gov-ernment’s blueprint for ener-gy development over the nexttwo decades. It sees conven-tional fuels like oil, gas andcoal remaining “indispens-able”, and development ofthose sources is being accel-erated. But, at the same time,alternative sources of energywill also be developed.

Already, approximately halfof fuel inputs for power gen-eration come from renewablesources, namely hydropow-er, according to the Depart-ment of Energy.

Nevertheless, the Aquinoadministration would like totriple its capacity in clean en-

ergy by the year 2030, forwhich it will need some P556.7billion ($13.2 billion) in in-vestment, says Energy Secre-tary Carlos Jericho Petilla.

Fossil fuels, of course, stillhold a prominent place in theenergy matrix.

Areas for exploration anddevelopment of oil, gas andcoal are being offered up forbidding in an ongoing seriesof Philippine Energy ContractRounds (PECRs). Throughthese, it is hoped to providethe country with the means tobe energy self-sufficient.

The national productionlevel target set in 2009 for oiland gas for 2030 is around78.5 million barrels, 2,694 tril-lion cubic feet of gas and con-densate of 87.58 millionbarrels.

Former Energy SecretaryJose Rene Almendras (nowCabinet Secretary to the Pres-ident) believes natural gas will

become a major componentin the energy mix.

“As hydrocarbon supplystarts going down, with 50,75, 125 years left, we are nowseeing natural gas on the up-

swing. I personally believethere is a lot more gas than oilin our area. Knowing that weare going to use natural gas asa major component for ourenergy mix five to 10 years

from now, we need to buildthe infrastructure.”

Under PECR 4, 38 coalblocks were opened to around of bidding, whichprompted an “overwhelming”response from would-be in-vestors. Coal production isexpected to increase by up to250%, as new companiescome into the sector and ex-isting coal operating contractsmove from exploration to de-velopment.

The Philippines currentlyimports around 7 million tonsof coal a year, around 75% ofits domestic requirement;over the next 20 years, coal isexpected to remain the majorfuel for power generation.

The archipelago is ex-tremely wealthy in other min-eral resources, as well. In fact,it is believed to possess someof the biggest mineral reservesin the world – at least $840billion in gold, copper, nick-el, chromite, manganese, sil-ver and iron.

Investments in explorationand mining projects totalled$3.8 billion from 2004 to2010, and the industry gen-erated P9.1 billion ($215.2million) in taxes, fees and roy-alties in 2010, according tothe Department of Environ-ment and Natural Resources’(DENR) Mines and Geo-sciences Bureau.

The Aquino administra-tion, however, would like tofurther boost state revenuefrom the mining industry for

investment in railway, high-way and airport projects.

As well as increasing taxesand royalties on sales of re-sources, the Philippines is tak-ing a harsher stance oncorruption and illegal min-ing, two traits that hadplagued the country’s miningindustry for decades.

In eliminating illegal min-ers from the equation, the fieldwill be clearer for responsibleplayers who understand thattransparency and sustainablemethods will bring longer-lasting rewards, for everyone –shareholders, government andcommunities, alike.

The sincerity of the Aquinoadministration’s mining sec-tor reforms have borne fruit interms of international recog-nition. The Extractive Indus-try Transparency Initiative(EITI) – an internationally de-veloped standard that ensuresgreater transparency and im-proved governance of coun-tries’ mining resources –accepted the Philippines’ can-didacy in May this year.

“When President Aquinoissued Executive Order 79[closing certain zones to min-ing applications], the EITIBoard must have read themove as unequivocal state-ment of the government’s in-tention to implement Eiti,”said Ramon Paje, Secretaryof the DENR.

The Philippines hopes toachieve EITI membership by2015.

Making the mostof its resourcesThe Philippines is stepping up oil, gas and coal exploration while at the same time boosting renewable powersources. The government is also putting the mining sector into shipshape

RAMON PAJE, Ramon Paje, Secretaryof Department of Environment andNatural Resources

CARLOS JERICHO PETILLA, Secretaryof the Department of Energy




If you are looking for a wholedifferent experience on yournext vacation, head east ofVietnam and try the beautifulisland nation of the Philippines.Lapped by the Luzon Straitand the South China, Celebes,Sulu and Philippine Seas, thistropical archipelago of 7,107islands covers a land areaslightly larger than that of Ari-zona and is packed with de-lights to discover.

Favorite haunts for visitorsrange from the truly spectac-ular beaches of Boracay andimpressive UNESCO WorldHeritage Site rice terraces ofBanaue, to world-class divingin Palawan and one of theworld’s best preserved his-toric sites from World War IIon Corregidor, in addition toothers in Leyte and aroundthe country.

Traditionally popular withvisitors from North Americaand Europe – the U.S. is thePhilippines’ second-largesttourist market by nationality,just after South Korea andahead of Japan – the Philip-pines is expecting a surge innear-haul arrivals from aroundthe region, as neighboringcountries’ economies expandand their middle classes’ trav-el budgets follow suit.

Last year, the Philippineswelcomed almost 4.3 millionvisitors – breaking the 4 mil-

lion mark for the first time inits history. World Travel andTourism Council figures showthat the $4.484 billion that trav-el and tourism directly con-tributed to the country’s GDPin 2011 rose almost 14% in2012 to $5.108 billion.

In the first two months of2013, tourist arrivals in thePhilippines hit a record high of854,187. According to TourismSecretary Ramon Jimenez, Jr.: “Our tourism numbers arenow reaching unprecedentedheights. We have a target of5.5 million this year and 10 mil-lion by 2016. Our efforts are infull swing to raise greater de-mand, facilitate entry and access to the different desti-nations, and for our suppliers

and host communities to cometogether and create fun-filledexperiences.”

In addition to attractingmore foreign arrivals, the gov-ernment is also targeting 56.1million domestic tourists by2016 and has stated that an es-timated 37,000 more hotelrooms will be needed intourism hotspots by 2016.

Potential investors in thePhilippine tourism industrycan also take confidence fromthe ongoing improvementsin the overall business cli-mate in the Philippines.Among these include betterprotection of property rights,greater openness toward for-eign investment, and fewervisa requirements for foreignvisitors.

Tourism also has the fullsupport of President BenignoAquino III, who hopes tobuild up a vibrant tourismsector, identifying it as a toppriority industry. The De-partment of Tourism pointsout that almost half of the gov-ernment’s infrastructure pro-jects have been aligned tosupport access to the coun-try’s cluster tourist destina-tions. Being an archipelago,the sector will need the sup-port of a reliable transporta-tion network in particular.

An example of governmentinitiatives complementing

each other can be seen in aconvergence task force in placebetween the Department ofTourism and the Departmentof Public Works and Highwaysfor the construction of tourismroads, bridges and other suchprojects. Closer coordinationamong all sectors to stream-line the tourist experience atall major ports is additionalevidence of a unified deter-mination to build up and sup-port the expansion ofPhilippine tourism.

Such efforts to develop thePhilippines’ tourism potential

have been recognized by theWorld Economic Forum(WEF) tagging the country asthe “most improved” in theAsia-Pacific region earlier thisyear. In its Travel & TourismCompetitiveness Report 2013analyzing 140 economies, theWEF ranked the country 16th

in the region and 82nd globally– the latter result represent-ing a 12-place leap. The reportfound the prioritization of thetravel and tourism industrywas “very strong”, with thecountry’s 15th place rankingcoming as government spend-

ing on the sector as a percent-age of GDP now being “first inthe world, and tourism mar-keting and branding cam-paigns are seen to beincreasingly effective.”

The country’s popular ‘It’sMore Fun in the Philippines’tourism campaign currentlyin full sway taps into the pow-er of promotion via socialmedia channels and aims toraise the country’s interna-tional profile to show theworld that the Philippines isnot just a place to see, but aplace to experience.

Word spreadsabout tourism’spotentialA major push to boost tourism numbers and infrastructure is in full swing asrecord numbers of visitors are flocking to the island paradise throughinnovative branding and investor-friendly policies

TO SATISFYGROWINGDEMAND ANDTOURISTNUMBERS, ANADDITIONAL37,000 NEWHOTEL ROOMSARE NEEDED BYTHE YEAR 2016 INKEYDESTINATIONSAROUND THEARCHIPELAGO

The world-famous 2,000-year old Banaue Rice Terraces cover 4,000 square miles of countryside


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Monday, June 17, 2013 Riseandshinewith thePhilippines · 2014-10-14 · roled in school. President Aquino and his “boss” have much to celebrate despite the ongoing chal-lenges