BusinessMirror January 13, 2015

By Catherine N. Pillas

The Department of Trade and Industry (DTI) and the Department of Finance

(DOF) have found a common ground on the grant of tax breaks, finally agreeing to give Board of Investments (BOI)-registered companies the privilege of paying only 15-percent income tax for 15 years. This is in lieu of the income-tax holidays (ITH) of up to eight years currently enjoyed by BOI- registered firms. The DTI and DOF, long at loggerheads over the nature of perks that should be given to new quali-fied investments, have been directed by Congress to immediately come up with a compromise provi-sion on the tax break under the fiscal incentives rationalization bill. In an interview, Trade Secretary Gregory L. Domingo said the earlier proposal to scrap the ITH and replace it with lower corporate income tax has moved forward, with the DTI and DOF agreeing on a maximum effec-tivity period of 15 years.

By VG Cabuag

PrOPerTy developer Ayala Land Inc. on Monday said it raised some P16 billion from the top-up placement of its common shares being held by

its parent firm, conglomerate Ayala Corp. The company said, in its disclosure to the Philip-pine Stock exchange, that proceeds of the transac-tion, which reduces Ayala’s holdings in its property arm, will be used for its expansion projects. For the year, the developer is setting aside some P100 bil-lion as its capital-expenditure budget. Ayala Land said the top-up placement involves the selling of its 484.84 million common shares at a price of P33 apiece, below its Friday’s close of P35 per share. The company’s share price fell by about 3

By Lorenz S. Marasigan

ZHeA KATrInA eSTrADA, 20, fills water bottles up with P5 coins to finance her

personal trips.  She usually travels around the Philippines, reveling in the Pearl of the Orient’s natural beauty.  Travel-ing on limited budget, she usually buys plane tickets that are on sale. “The ‘piso fare’ from local airlines are really helpful, especially if you want to go to places that are far from Luzon—those that you cannot go to by land,” she said over the phone. “I

only go for low fares since I travel on limited budget.” So when she learned from the BusinessMirror that the Civil Aeronautics Board (CAB) ordered in December last year the removal of the fuel surcharge from airfares, es-trada, a Web-content writer for an information-technology company, was thrilled.  “It’s good news. Personally, I feel happy about it because I would have to pay less for the fare. This also means that more people will get to travel,” she said. 

www.businessmirror.com.ph n Tuesday, November 18, 2014 Vol. 10 No. 40 P25.00 nationwide | 8 sections 36 pages | 7 days a weekn Tuesday, January 13, 2015 Vol. 10 No. 96

A broader look at today’s businessBusinessMirrorthree-time

rotary club of manila journalism awardee2006, 2010, 2012u.n. media award 2008

Peso exchange rates n us 44.9460 n jaPan 0.3793 n uK 68.1606 n hK 5.7956 n china 7.2393 n singaPore 33.7104 n australia 36.8470 n eu 53.2251 n saudi arabia 11.9712 Source: BSP (12 January 2015)

PAPAL VISIT 2015

2 DAYSINSIDE

furniture-shoPPing now just a clicK away

3 million march in france vs terrorism

Life Tuesday, January 13, 2015 D1BusinessMirrorEditor: Gerard S. Ramos • [email protected]

Golden Globes 2015 RoUndUP

»D3HeRe we are lord, sinful, wounded and frail,

but with a burning desire to be part of Your "rescue team" that brings Your love and

hope to a confused, sinful and wounded world. Hold our hands, lord, and teach us to walk and preach with You, then we will feel and think that we can be partners in Your saving work. Amen!

“Rescue team”

WORD OF LIFE, FR. saL putzu, sDb aND LOuIE m. LacsONWord&Life Publications • [email protected]

By Samito [email protected]

T HE modern convenience of technology has made cocooning all the more comfy. With traffic jams occurring all over the city at all times of the day, one does not want his sense of serenity to be wrecked

by long sojourns to the brick-and-mortar retail store. With convenience in mind, a local retailer-manufacturer has answered the call for efficient product placement right in your home. Now, furniture shopping is made easier than ever. Thanks to Mandauefoam.ph, a lovely couch, bed, or dining set is easily achieved without breaking into a sweat. It’s just a click away through the friendly convenience of one’s computer or mobile device. By simply visiting the site, one may enjoy the benefit of easy access to a wide range of beautifully designed furnishings available at cost-effective price points. In just a few minutes, nay, seconds, one can compare items, check product reviews and purchase

By Vicki PayneThe Charlotte Observer

G rEaT design is all about editing; getting rid of what doesn’t work and keeping what does. I think this topic falls perfectly into this

theory. It’s a question all of us face after Christmas: “Where the heck are you going to put all this new stuff? after years of struggling with this issue, I’ve finally found the solution. This week, make room while doing something charitable for those less fortunate than you. I know I can hear you already saying, “I am too busy this week. I have no time for another task.” Trust me—this is the best use of your time and the process is quick, fun and painless. It’s a family project. You are going to break your entire house down into two areas, personal and common spaces. It will only take one hour. Start by enticing your family. Explain to them that great treasures await, but first we have to make room. Give each person a large shopping bag. Instruct them to go to their rooms and remove all the old, worn, unwanted items from their dressers and closets.

They just have to remove enough items to stuff the bag completely full. any item that are beyond being useful to others get pitched into a garbage bag. Make it a game. Set the timer for 40 minutes for individual rooms and instruct them to ask themselves these questions regarding the things they have: Does it fit? Is it stained or torn? Do I ever wear or use it? ring some jingle bells and send off your little elves to pitch the old in anticipation of the new. Next, the common areas. Each family member gets a cardboard box and an assignment, based on age, to tackle the clutter in playrooms, family rooms, coat closets and kitchen cabinets. Time to pitch all those plastic butter tubs and chipped glasses and plates. recycle old magazines and newspapers. Set the timer for 20 minutes and let the editing begin. The reward? Take a ride to a local charity or thrift store to deliver the shopping bags of reusable items and then stop for pizza at their favorite restaurant. This will give you an opportunity to talk about how lucky your family is to have a home and gifts to share over the holiday season. n Designer and home improvement expert Vicki Payne is host and producer of “For Your Home,” available on PBS, Create TV and in national and international syndication. Reach her at ForYourHome.com.

Make room in your house for presents

Furniture-shoppingnow just a click away

cREatINg the perfect home environment

has never been easier with mandaue

Foam Furniture store’s presence on

the Web.

the bed or any other furniture with great ease. Thanks to their innovative approach to customer satisfaction, perfected through 40 years of providing customers with quality and value-for-money products, Mandaue Foam Furniture Store continuously strengthens its brand presence through a diversification of distribution channels, starting with an aggressive campaign to expand its factories and showrooms to no less than 19 locations nationwide. The step to creating a virtual storefront was only a natural extension of their commitment to making the life of the Filipino more comfortable. Thus, the lifestyle store’s complete range of furniture and accent pieces are now available at an electronic whim. From sofa sets and coffee tables for the living room, to office cabinets and other nifty storage solutions for the home office, the portal has it all. For utmost convenience, Mandauefoam.ph also delivers to various locations in Luzon, Visayas and Mindanao. One may have a design solution hauled posthaste to one’s doorstep by filling out the shipping form together with one’s payment details as one checks out. Truly, Mandaue Foam Furniture Store’s online shop is your one-stop shop for easy and convenient furniture shopping.

PARIS—More than 1 million people fi lled the boulevards and avenues of central Paris

on Sunday, marching arm in arm in a display of national unity after a string of attacks that killed 17 people and dramatized France’s vulnerability to terrorism.

WorldBusinessMirror

The

B3-1 | Tuesday, January 13, 2015 • Editor: Lyn Resurreccion

Fifty world leaders led the proces-sion, walking at the head of a march that began at the Place de la Repub-lique, the symbolic heart of French democracy, and quickly became so large that it paralyzed the heart of the city and took on a life of its own.

“Paris is today the capital of the world,” French President François Hollande said.

News agencies reported that more than 3 million people across France participated in marches, described as some of the largest

demonstrations in the nation’s re-cent history.

Rallies held in sympathy were also reported in dozens of cities around the world—including Ber-lin, London, Buenos Aires, Madrid and Brussels.

Among those who joined the pro-cession in Paris were Israeli Prime Minister Benjamin Netanyahu, Pal-estinian Authority President Mah-moud Abbas, British Prime Minister David Cameron and German Chan-cellor Angela Merkel.

Ambassador Jane Hartley rep-resented the United States, the US Embassy told the Agence France-Presse news service.

Hollande and Netanyahu later attended a ceremony at Paris’ Grand Synagogue to commemorate the victims of an attack on Friday at a kosher grocery that left four hos-tages dead, one of the three strikes

last week. � e other victims were 12 people killed on Wednesday at the o� ces of Charlie Hebdo, a satirical magazine, and a policeman killed in southern Paris on � ursday.

� e march in Paris was both a robust repudiation of terrorism and a ringing endorsement of freedom of expression and the craft of journalism.

French people from all walks of life participated in the highly symbolic gathering, standing in solidarity against an assault that shocked the nation and highlighted the threat of Islamic terrorism across Europe. Some have called last week’s attacks France’s September 11, referring to the terror attack in the US in 2001.

“We came here to defend the fundamental values of France and to display to the world our rejec-tion of barbarism,” said Elisabeth Pilate, a Parisian grandmother present with her daughter and sev-eral grandchildren. “France rejects terrorism completely.”

At the march, thousands of Je suis Charlie—I am Charlie—signs were hoisted in commemoration of the attack on the o� ces of Charlie Hebdo, site of the initial violence. � e magazine apparently was at-tacked because of its mocking cari-catures of Islam and the Prophet Muhammad, among the irreverent publication’s many targets.

But there were also large num-bers of placards and signs declaring “Je suis Juif ”—I am a Jew—in rec-ognition of the grocery store attack and others that stated Je suis polici-er—I am police. Los Angeles Times/TNS

LARGEST IN FRENCH HISTORY3 million march in France vs terrorism

PARIS Mayor Anne Hidalgo (front row, from left), President of the European Commission Jean-Claude Juncker, Israeli Prime Minister Benjamin Netanyahu, Malian President Ibrahim Boubacar Keita, French President François Hollande, German Chancellor Angela Merkel, Palestinian Authority President Mahmoud Abbas, Italian Prime Minister Matteo Renzi, Ukrainian President Petro Poroshenko and other dignitaries, heads of government and heads of state march during a rally in Paris on Sunday. More than 40 world leaders, their arms linked, marched through Paris to rally for unity and freedom of expression and to honor 17 victims of three days of terrorist attacks. AP/CHRISTOPHE ENA

A MILLION people marched through Paris on Sunday in a massive show of unity and de� ance in the face of terrorism that killed 17 people in France’s bleakest moment in half a century. News reports say more than 3 million people across France participated in marches, described as some of the largest demonstrations in the nation’s recent history. AP/LAURENT CIPRIANI

PANGKALAN BUN, Indone-sia—Divers retrieved one of the black boxes on Monday

from the AirAsia plane that plum-meted more than two weeks ago into the Java Sea, a major breakthrough in the slow-moving hunt to recover bod-ies and wreckage.

� e � ight data recorder was found under part of the plane’s wing and brought to the surface early in the morning, said Henry Bambang Soe-listyo, head of the national search-and-rescue agency.

Divers began zeroing in on the site a day earlier after three Indone-sian ships picked up intense pings from the area, but they were unable to see it due to strong currents and poor visibility, said Suryadi Bam-bang Supriyadi, operation coordi-nator at the national search and rescue agency.

He earlier said the black box was lodged in debris at a depth of about 30 meters, but Soelistyo did not provide additional details about the discovery.

Searchers will continue to scour the seabed to try to locate the other black box, the cockpit voice recorder,

which is believed to be emitting a sep-arate signal between two meters and 20 meters away, he said.

“Hopefully, it can be retrieved with-in hours today [Monday],” Supriyadi

said from Pangkalan Bun, the town closest to the site on Borneo island. He added that diving conditions were not favorable.

� e two instruments are vital to

understanding what brought Flight 8501 down on December 28, killing all 162 people on board. � ey pro-vide essential information, including the plane’s vertical and horizontal

speeds, along with engine tempera-ture and � nal conversations between the captain and copilot.

� e � ight data recorder will be taken to Jakarta, the capital, for analysis. It could take up to two weeks to download its information, said Nurcahyo Utomo, an investiga-tor at the National Committee for Safety Transportation.

O� cials recovered the aircraft’s tail on Saturday, the � rst major wreckage excavated from the crash site. � ey were hopeful the black boxes were still inside, but learned they had detached when the plane crashed into the sea. On Sunday the ships detected two strong signals near each other.

Search e� orts have been consis-tently hampered by big waves and powerful currents created by the region’s rainy season. Silt and sand, along with river runo� , have created blinding conditions for divers.

On Sunday Soelistyo said divers located the wing and debris from the engine. O� cials initially were hope-ful it was the main section of the Air-bus A320’s cabin, where many of the corpses are believed to be entombed. AP

Divers retrieve 1 of 2 black boxes from crashed AirAsia jet

CREW members of Crest Onyx ship prepare to unload parts of AirAsia Flight QZ8501 from a ship at Kumai port in Pangkalan Bun on Sunday. A day after the tail of the crashed AirAsia plane was � shed out of the Java Sea, the search for the missing black boxes intensi� ed on Sunday with more pings heard. AP/ACHMAD IBRAHIMA

SOUTH Korean President Park Geun-hye said she is willing to meet with North Korean leader

Kim Jong Un, and the country’s nu-clear weapons program wouldn’t be an obstacle to holding the � rst Korean summit since 2007.

“There are no preconditions,” in-cluding nuclear disarmament, for a summit between the two countries, Park said on Monday at a televised news conference, warning Kim should drop his nuclear pursuit in order to achieve an eventual uni� cation.

Park also urged the North Korean leader to agree to resume the re-unions of families that remain sepa-rated more than 60 years after the end of the civil war that left the pen-insula divided.

Relations on the Korean peninsula have been complicated by North Ko-rea’s push to develop nuclear weapons and its threats to use them against the South. In recent months there have been some signs of easing tensions.

In October North Korea sent three members of Kim’s inner circle to meet with Park’s chief security adviser. That led to the � rst talks between their mili-tary generals since 2007.

North Korea’s o� cial Korean Cen-tral News Agency said on January 10 that the country could suspend nucle-ar tests if the US stopped joint military exercises in South Korea.

State Department Spokesman Jen Psaki called the o� er “inappropriate,” saying in an e-mailed statement that another test would be a violation of the North’s obligations under United Nations Security Council resolutions and a 2005 agreement as part of six-nation disarmament talks.

South Korea has said the North must end its pursuit of nuclear arms and acknowledge it attacked the South’s Cheonan warship in 2010, among other concessions, before it can resume large-scale economic as-sistance seen under former President Roh-moo Hyun.

Roh participated in the last sum-mit when he met Kim’s father, Kim Jong Il, in Pyongyang in October 2007, a year after the North conducted its � rst successful nuclear test.

Park has repeatedly called on Kim to embrace her idea of building a joint peace park inside the demili-tarized zone since taking o� ce in February 2013. Last year she started a government campaign to prepare for uni� cation, saying that it could be an economic “bonanza” for both nations, even as a declining number of South Koreans view it as neces-sary. Bloomberg News

S. KOREA’S PARK READY TO MEET KIM JONG UN WITH NO CONDITIONS

LiFe d1

worLd B3-1

See “Airlines,” A2See “Ayala,” A2

Continued on A2

DTI, DOF finally agree on tax perks

Ayala Land nets₧16 billion fromtop-up placement

b.o.i.-registered firms to Pay only 15% income tax for 15 yrs in new draft bill

Airlines start removing fuelsurcharges on CAB order

get ready to wear shortPants at worK in summer

Office workers in the Philippines could be donning shorts for work this summer as air conditioners are dialed back to cut electricity demand and stave

off blackouts. At least that’s one scenario suggested by energy Secretary carlos Jericho L. Petilla, as the government and private offices, malls and factories are asked to set their air conditioners at 25 degrees celsius (77°f). “if we can go to work in shirts and short pants,” that could help cut power use, Petilla said in an interview last week. Shopping malls and factories have already been warned to get ready to use their own generators, as the blackouts that plague the country each summer are forecast to worsen in March and April. That’s when demand typically surges as temperatures reach as much as 40°c.

ViN d’HoNNeur President aquino delivers his message during the New year’s vin d’honneur at the rizal Hall of the Malacañan Palace on Monday. The annual reception, which marks the 28th vin d’honneur since the 1986 edsa revolution, was attended by government officials, members of the diplomatic corps, officials of international organizations and businessmen. MalacañaNg Photo/ BeNhur arcayaN

JAPAN LOOKING AT RECORD BUDGETTO HELP ECONOMY HIT BY RECESSIONJAPAn plans a record budget for next fiscal

year to support an economy that fell into recession after Prime Minister Shinzo Abe’s

government increased sales tax. Government ministers and the ruling coali-tion parties approved the ¥96.34-trillion ($814- billion) budget proposal for the 12 months start-ing April 1 at a meeting in Tokyo on Monday, finance Minister Taro Aso told reporters. Japan, fighting to rein in the world’s heavi-est debt burden, will see tax revenue rise to the highest level in 24 years, while new bond issuance declines to the lowest since 2008. Abe has already boosted public-works spending and support for small businesses through a supple-mentary budget for the current year. “The budget will continue to grow each

year as it gets increasingly difficult to curb social-welfare spending due to Japan’s aging population,” said Kyohei Morita, chief Japan economist at Barclays Plc. “Given the risk that the economy will be hurt by a sudden decline in public-works spending in the latter half of 2015, the government might have to draft an-other extra budget.” Tax revenue for the next fiscal year is pro-jected to rise to ¥54.53 trillion and cover 57 percent of the budget, up from 52 percent. new bond issuance will decline to ¥36.86 tril-lion, Aso said. While the sales tax has increased, the gov-ernment has plans to reduce corporate taxes by 3.29 percentage points over two years.

See “Japan,” A2

JaPaNese Prime Minister shinzo abe (left) speaks during a New year’s party jointly hosted by the country’s leading business organizations in Tokyo last week. aP

Continued on A8

It’s going to be 15-percent corporate-in-come tax for 15 years. The previous proposal was 10 years; now it’s 15 years. That’s still more agreeable to the finance department than the ITH,” Domingo said. The trade chief explained that the longer period would be more attractive, considering it is almost double the maxi-mum period allowable for ITH at eight

years. Also, compared to the ITH, the new proposal would ensure the DOF would re-alize their tax dues immediately. Currently, a registered pioneer enterprise with pioneer incentives is entitled to six years of ITH, which can be extended to eight years. A non-pioneer enterprise is allowed up to four years of ITH and additional two-year bonus. The prevailing corporate-income tax for en-terprises, foreign and domestic, is 30 percent. Domingo earlier also said firms under

certain industries waste the first few years, as they hardly make a profit in their first few years of operations.  The trade head insisted there has al-ready been a “meeting of the minds” be-tween the two contending departments, and the joint position would be submitted to Congress before the resumption of ses-sions on January 19.  “As of Christmas time, there was already an agreement. It’s final, we will submit

the joint draft bill before January 19,” Domingo said.  Both the House and the Senate ver-sions of the fiscal incentives rationaliza-tion bill are still in the committee level handled by the respective chambers’ ways and means committee.  The Senate committee is chaired by Sen. Juan Edgardo “Sonny” M. Angara, while the House counterpart is headed by Rep. Romero “Miro” S. Quimbo. 

SUNRISE SUNSET

NEW MOON6:24 AM 5:45 PM

MOONRISEMOONSET

11:32 AM ----

TODAY’S WEATHERMETROMANILA

LAOAG

BAGUIO

SBMA/CLARK

TAGAYTAY

LEGAZPI

PUERTOPRINCESA

ILOILO/BACOLOD

TUGUEGARAO

METROCEBU

CAGAYANDE ORO

METRODAVAO

ZAMBOANGA

TACLOBAN

3-DAYEXTENDEDFORECAST

3-DAYEXTENDEDFORECAST

CELEBES SEA

LEGAZPI CITY23 – 31°C

TACLOBAN CITY24 – 29°C

CAGAYAN DE ORO CITY

METRO DAVAO24 – 30°C

ZAMBOANGA CITY23 – 32°C

PHILI

PPIN

E ARE

A OF R

ESPO

NSIB

ILITY

(PAR

)

SABAH

PUERTO PRINCESA CITY 24 – 30°C METRO CEBU

24 – 30°C

ILOILO/BACOLOD

24 – 31°C

23 – 29°C

24 – 29°C 24 – 29°C 23 – 30°C

24 – 29°C 23 – 30°C 23 – 29°C

23 – 29°C 22 – 29°C 22 – 29°C

23 – 31°C 23 – 30°C 23 – 30°C

23 – 31°C 23 – 32°C 24 – 32°C

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

Weekday hourly updates: 6:00 AM on Balitaan, 7:00 AM & 8:00 AM on Good Morning Boss!, 9:00 AM, 10:00 AM, 11:00 AM, 12:00 PM, 1:00 PM

on News@1, 3:00 PM, 4:30 PM, and 6:00 PM on News@6

www.panahon.tv

@PanahonTV

JANUARY 13, 2015 | TUESDAY

HIGH TIDEMANILA

SOUTH HARBOR

LOW TIDE

9:08 AM0.12 METER

TUGUEGARAO CITY 19 – 29°C

LAOAG CITY 19 – 30°C

TAGAYTAY CITY 18 – 28°C

SBMA/CLARK 20 – 30°C

20 – 30°C 21– 30°C 21 – 31°C

19 – 30°C 20 – 30°C 19 – 30°C

19 – 30°C 20 – 30°C 20 – 30°C

12 – 23°C 12 – 23°C 12 – 23°C

18 – 29°C 19 – 29°C 19 – 30°C

23 – 31°C23 – 32°C 22 – 31°C

24 – 31°C 24 – 32°C

22 – 30°C21 – 30°C 22 – 31°C

24 – 31°C24 – 32°C 23 – 31°C

Partly cloudy to cloudy skies withisolated rain showers and/or thunderstorms

Cloudy skies with rain showersand/or thunderstorms.

HALF MOON

5:46 PMJAN 13

9:14 PMJAN 20

BAGUIO CITY11 – 23°C

24 – 31°C

2:10 AM0.58 METER

JAN 14WEDNESDAY

JAN 15THURSDAY

JAN 16FRIDAY

JAN 14WEDNESDAY

JAN 15THURSDAY

JAN 16FRIDAY

Partly cloudy to at times cloudywith rainshowers

NORTHEAST MONSOON AFFECTING LUZON.TROUGH OF LOW PRESSURE AREA (LPA)AFFECTING VISAYAS AND MINDANAO.

(AS OF JANUARY 12, 5:00 PM)

METRO MANILA20 – 30°C

Northeast Monsoon locally known as “Amihan”. It a�ects the eastern portions of the country. It is cold and dry; characterized by widespread cloudiness

with rain showers.

Airlines. . . Continued from A1 Japan. . . Continued from A1

Ayala. . . Continued from A1

BusinessMirror [email protected] Tuesday, January 13, 2015A2

NewsContinued from A1

percent on Monday’s trade. As a result of the transaction, Ayala’s holdings in common shares will be reduced to 47.3 percent from 48.9 percent in the developer, although the conglomerate will retain voting control at over 68.9 percent. “This equity placement will help Ayala Land pursue its growth plans and achieve its long-term strategy. We remain commit-ted and supportive of Ayala Land, and con-tinue to believe that it is a key component of our portfolio and an important driver of growth at Ayala Corp.,” Chairman and CEO Jaime Augusto Zobel de Ayala said in a statement. Ayala Land, the country’s second-largest property developer, said its income rose by 25 percent during the first three quarters of 2014 to P10.8 billion, driven mainly by robust performance across the property de-velopment, commercial leasing and services business units. Consolidated revenues reached P68.3 bil-lion, 20 percent higher than the P56.9 billion in the previous year. The company’s property-development business, which includes the sale of residen-tial lots and units, office spaces, as well as commercial and industrial lots, posted total revenues of P47 billion, 26 percent higher than the P37.4 billion it recorded last year. Revenues from the residential segment grew by 40 percent to P40.1 billion in the period. This was again driven by strong bookings and project completions across all segments. Meanwhile, cash from shopping centers grew by 9 percent to P8.3 billion from P7.6 billion. Total gross leasable area was up 9 percent year on year, while occupied gross leasable area (GLA) was up 6 percent. The company saw a 19-percent increase in its revenues from office-leasing operations to P3.1 billion from P2.6 billion. Total GLA was up 4 percent year on year, while total occu-pied GLA was up 11 percent as of the end of September 2014.

Economic contractionGROSS domestic product (GDP) contracted for two straight quarters after the sales tax was increased 3 percentage points to 8 percent in April. In response, the government deferred an-other planned bump in the levy and in December assembled a ¥3.5-trillion stimulus package and the supplementary budget. Real GDP should rebound, growing 1.5 percent next fiscal year, according to estimates released by the Cabinet Office on Wednesday. That follows a projected 0.5-percent contraction in the 12 months through March. Abe’s Cabinet is scheduled to meet on January 14 to formally adopt the budget. The government has yet to release a full break-down of all planned expenditure. “The budget deals appropri-ately with issues Japan faces, including the revitalization of regional economies and the improvement of social welfare,” Aso said. “Coupled with tax revisions for the next year, the budget will revive the economy while consolidating govern-ment finances.”

Debt-to-GDPTHE government will meet its target for halving the ratio of the primary balance deficit to GDP next fiscal year, Aso said. This gauge is calculated by subtracting expenditures excluding interest payments from revenues without bond sales, and is a key mea-sure for the Abe administration as it attempts to control debt. In a fiscal reform plan released in 2013, the government said it also aimed to achieve a surplus in the primary balance in 2020. Japan’s debt-to-GDP ratio is projected by the International Mon-etary Fund to swell to more than 245 percent in 2015. Bloomberg News

DTI, DOF finally agree on tax perks

Estrada is just one of the millions of passengers that fly in and out of Manila’s congested airports. For these people, the removal of the fuel sur-charge, which came due to dwindling prices of crude, is a welcome idea.  The two biggest carriers in the Philippines,  on Monday, said they have complied with the mandate of the regulator.  Philippine Airlines (PAL) President Jaime J. Bautista said his company has made adjustments to its ticketing sys-tem to comply with the order.   “We have carried out the necessary procedural and system adjustments in view of this latest call from the govern-ment. Rest assured that PAL will always bear in mind the welfare of our custom-ers and the traveling public,” he said.  The flag carrier removed the fuel-surcharge component from its tickets starting January 10.  For his part, Cebu Pacific Spokes-man Jorenz T. Tanada said his com-pany has “started the implementation of the removal of fuel surcharges ef-fective January 9.” “We are still assessing the impact;

but as oil cost has also been declining in recent weeks, we don’t see a material adverse impact on our profitability,” the airline executive said.  The budget carrier, owned by tai-pan John L. Gokongwei, dominates the local airline industry. It further cemented its title as the leader in Phil-ippine low-cost travel after it acquired rival Tigerair Philippines in the earlier part of 2014.  Cebu Pacific, however, faces penalties after its lackluster service during the holidays. A fuel surcharge is a temporary re-lief granted to airlines to help them recover losses incurred from higher jet fuel prices. It ranges from P500 to as high as P15,000, depending on the destination. Fuel accounts for as much as 60 per-cent of an airline’s operating cost per passenger, and is the second-highest expense next to labor. Fuel prices have been dropping since December as the Organization of Petroleum Exporting Countries de-cided to maintain current production levels despite a glut in the market with an estimated oversupply of 1.5 million

to 2 million barrels daily. Following a period of relative stabil-ity of above $100 per barrel, oil prices have plunged since mid-2014, falling by more than $40 per barrel to five-year lows. CAB Executive Director Carmelo L. Arcilla, however, reminded that the order is provisional, meaning  it may still be lifted, especially if there is a sharp increase in fuel prices in the international market.  The Institute of International Fi-nance expects oil markets to tighten only very gradually during 2015. Data from the International Air Transport Association showed jet fuel cost was at $71.7 per barrel as of Janu-ary 2, down by 18.1 percent from the preceding month and 43.2 percent less than the year-ago price. Estrada’s next move, she said, is to plot her next trip right after she fills her water bottles with gold coins that bear the face of Emilio Aguinaldo.  “After Luzon, my next target is the south—the Visayas and Mindanao,” she said excitedly. “I’m excited for my next trip.”

THE result of the latest Social Weather Stations (SWS) sur-vey showing that 65 percent

of Filipinos are satisfied with the performance of Vice President Jejo-mar C. Binay indicates that, despite the smear campaign against him, he still continues to enjoy the support of the people. Lawyer Rico Paolo Quicho, the Vice President’s spokesman for po-litical affairs, said “The campaign of lies and pattern of deceit waged by his [Binay’s] detractors in Senate failed to discredit his accomplis-ments and track record as a proven public servant.” The fourth quarter 2014 SWS conducted from November 27 to December 1, 2014, showed that Bi-nay had garnered a “good” rating, having scored a net satisfaction rating of +44 in December 2014. His latest showing a decrease of eight points from a very good +52 rating in September 2014. The survey also showed that out of 18 surveys conducted since September 2010, Binay attained an “excellent” rating eight times, “very good” nine times and “good” once. The same recent survey also showed that the people see the Vice President as the best leader to succeed President Aquino in 2016, garnering 37 percent of the votes.

Binay said he is grateful that the people still judge him by his work, despite the intensified smear efforts against him. “The Vice President is optimistic that “the misinformation being ped-dled against him that affects public perception will soon end with major-ity of the Filipino people realizing that surmises and conjectures can-not be the substitute for the truth,” Quicho said. “The Vice President remains firm that the allegations being hurled against him are baseless and bereft of any merit, which would not stand in an impartial and fair judicial scrutiny.”

[email protected] Editor: Dionisio L. Pelayo • Tuesday, January 13, 2015 A3BusinessMirrorThe Nation

MANILA—Some P12 mil-lion worth of cocaine was seized by the authorities

from a Mexican, allegedly belonging to Mexico’s notorious Sinaloa drug cartel, while reportedly selling the

prohibited drug in Makati City. Chief Insp. Roque Merdeguia, spokesman for the National Police’s Anti-Illegal Drugs Special Operations Task Force (AIDSOTF), identified the suspect as Horacio Hernandez, 39.

Hernandez was arrested while allegedly selling 2.5 kilograms of co-caine worth $120,000 at the parking lot of the Berjaya Hotel around 2:30 p.m. on Sunday. “Ang street value nito ay P12 million. Selling price niya ay

$120,000,” Merdeguia said. Members of the AIDSOTF and the Philippine Drug Enforcement Agency carried out the “buy-bust” operation, after being tipped off by an informant, he said. PNA

Binay elated by resultof December survey  

Cops seize P12-millioncocaine, nab Mexican

  The Ilocos police command sent 1,561 personnel to the National Capital Region. The augmentation force from Ilocos will be deployed at the Quirino Grandstand at Luneta Park in Manila. A total of 2,018 policemen were sent by the Cagayan Val-ley police command. These are already stationed at the Pasay City Sports Complex. The additional policemen will augment the personnel of the Metro Manila police command, the principal security force for the papal visit. Metro Manila policemen will also be augmented by personnel from the Calabarzon police office, the Nation-al Headquarters and the Philippine Public Safety College.

On the other hand, a total of 3,861 soldiers were committed to the Eastern Visayas police com-mand that is in charge of the se-curity in Tacloban City and Palo, both in Leyte, which the pope would also visit. Eastern Visayas policemen will be reinforced by troopers from other areas in Luzon, as well as the Visayas and Mindanao. A total of 608 policemen from Cagayan are already moving to Leyte aboard 14 buses and four marked vehicles, while 199 policemen from Southern Luzon are also traveling to Leyte, aboard four buses that are escorted by two police cars. Another 1,500 personnel from Bicol, which are aboard 32 buses, an ambulance and a back-to-back patrol

car, are also moving to Leyte. The Western Visayas police com-mand dispatched 1,364 troopers, who arrived in Leyte in an Air Force C-130 “Hercules” cargo plane on Saturday and the Caraga police sent 190 personnel aboard eight marked vehicles and five private cars. The national police is deploying a total of 27,000 policemen for the entire duration of the pope’s visit, while the military is chipping in 17,000 troops, including reservists. They would be supported by 54 bomb-sniffing dogs. Meanwhile, the military reiter-ated on Monday that there is no per-ceived threat against the pope, other than how to control the big number of people, who would be trooping to the areas where he would go. “So far, we see no serious threat on our radar screen,” said Col Restituto Padilla, Armed Forces spokesman. “The issue now is actually crowd management.” Padi l la , however, stressed that government security forces have prepared for the worst case scenario. “Despite the fact that we don’t see any serious threat looming in the horizon, the degree of preparation

is such in a state that it has veered for any kind of worst-case scenario,” he said. Reports said the national police issued a memorandum order-ing its units to be on alert against possible attacks from foreign ter-rorists, but Padilla dismissed such possibility. “We are not seeing anything, there is nothing coming out like that…as in zero,” he said. Even Deputy Director General Leonardo Espina, national police officer in charge, denied there was ever such a memorandum. The re-port (not in the BusinessMirror) quoted “Camp Crame intelligence sources.”

Policemen flocking to Manila,Leyte for Pope Francis’s visit

By Rene Acosta

ADDITIONAL policemen from Northern Luzon have been sent to Metro Manila, as part

of the overall effort to secure Pope Francis during his visit to the country.

binay

OttO Energy has estimated $16.66 million as earnings from its net production at

the Galoc oil field or Service Contract 14 (SC-14) in the fourth quarter of last year, lower than third quarter’s $22.23 million.

In a disclosure at the Australian bourse, Otto Energy said it has re-alized a sales revenue amounting to $16.658 million as its production net at the Galoc oil field for last year’s fourth quarter .

It noted Otto Energy production revenues for the third quarter of 2014 totaled $22.23 million.

Further, the Galoc field had a total barrel production of 616,708 barrels during the fourth quarter, with Otto having a net of 203,514 barrels. Per day output averaged at 6,703 oil barrels.

Otto Energy mentioned that one oil cargo was delivered dur-ing the fourth quarter, adding Cargo 42 was lifted on November 5, 2014, which contained 340,629 barrels. It was sold at $88.53 each to thai refineries.

Another delivery was made dur-ing the first quarter of 2015. Cargo 43 contained 341,158 barrels and was lifted on January 6. Otto said it was also purchased by thai refineries.

For the six-month outlook on the field, Otto maintained it will still divest its shares to another Aussie listed company, Nido Petroleum Ltd.

Last month Otto Energy reported it has received the full $10.8-million deposit for its 33-percent share in the Galoc Block from Nido Petroleum.

Nido Petroleum Managing Direc-tor Phil Byrne also said that during the same month, their company plans to boost the Galoc oil field’s production

BusinessMirror [email protected] A4

Economybriefs

bid opening for dnd’s casa program moved back to feb. 11The Department of National Defense (DND), in a supplemental bid bulletin, announced that bid opening and submission for its P4,968,000,000 close-air support aircraft (CASA) project has been reset to February 11. It was earlier scheduled on January 14. No reasons were given for the reset, which was posted on the supplemental bid bulletin, posted at the DND web site. Bid opening and submission will be held at DND Bidding and Awards Committee conference room, basement right wing, DND Building, Camp Aguinaldo, Quezon City at 10 a.m. The DND is planning to acquire six CASA to replace or beef up the Air Force’s existing Rockwell OV-10 “Bronco” turboprop attack planes. CAS refers to capability to provide air support to infantry and naval units in contact with the enemy. Funding for this weapon system will be sourced from the Revised Armed Forces of the Philippines Modernization Program.

The contract includes integrated logistic support system.

Winning bidders must be able to deliver the aircraft within 540 calendar days from contract effectivity. Participants in the DND’s CAS project must have completed a similar program within the last 10 years.

The CASA must be used by the countries offering and manufacturing them. PNA

p65b allotted for climate change, flood-control projects–abadBuDgeT Secretary Florencio B. Abad on Monday said the Aquino administration has prioritized climate-change adaptation and mitigation in the 2015 national budget by allocating P65 billion for flood control and rehabilitation projects for typhoon devastated communities.

Malacañang has approved a P2.606-trillion national budget for 2015 last month with huge allocation for rebuilding communities affected by Supertyphoon Yolanda.

Abad said the government is allocating P47.3 budget to the Department of Public Works and highways (DPWh) specifically for the flood control programs.

“This is among the investments that support the shift to the proactive approach rooted on the prevention and preparedness,” Abad said in the 2015 national budget briefer.

The Philippines is still in the recovery phase following the massive devastation wrought by Yolanda in November 2013 in the Visayas. government agencies have admitted that not all typhoon-devastated communities in the Visayas have been rehabilitated fully with alternative housing for the affected communities.

Abad said the government has also allocated P21.7 billion to various agencies to allow vulnerable communities to respond effectively to various natural calamities.

he said that of the P21.7 billion, the government has allocated P14 billion to the National Disaster Risk Management Fund.

At the same time, key agencies are given specific allocation from the P6.7 billion under the Quick Response Funds to allow them to step up programs during national calamities and disasters. The specific funds to these agencies also allow these agencies to act on their own programs without waiting for the release of budget from the national government.

Abad said the Aquino administration has allocated an additional P1 billion to the P10.1-billion Rehabilitation and Reconstruction Fund for the Yolanda- affected communities from the 2015 supplemental budget.

As of December last year, Abad said a total of P12.6 billion in balances were recorded in 2014 budget for the reconstruction and rehabilitation. E. Torres

T he airport up north received on Monday the highest safety rating  set by the In-ternational Civil Aviation Organization

(Icao) after it received modern fire trucks from Australia last week.  Clark International Airport Corp. (Ciac) Presi-dent emigdio P. Tanjuatco III said the P207-mil-lion acquisition of two Rosenbauer fire trucks and a two-finger Passenger Boarding Bridge paved way for the airport to receive the Category 10 status from the Icao.  The said status means that Clark Airport can handle emergency disasters involving wider air-craft such as the Boeing 777 and Airbus A380. “These are state of the art vehicles which are the first in the country today. These vehicles would be used for emergency disasters at Clark Airport and we are now capable of handling such disasters involving wider aircrafts which are currently being used by air carriers,” Tan-juatco said.  The new fire trucks are the new addition to Clark Airport’s four units of Oshkosh fire trucks. The old units are about 19 years of age and are set to be replaced. The Rosenbauer firetrucks were approved by the previous management led by then president Victor Jose I. Luciano.  At present, airlines oper-ating out of Clark involve: Cebu Pacific, Tigerair Philippines, Jin Air, Asiana, Dragaon Air and Qatar Airways.  Lorenz S. Marasigan

twO party-list lawmakers have filed a bill seeking to provide for people’s direct

participation in funding charitable institutions and other development- oriented civil-society organizations (CSOs) through a percentage of their personal income tax.

House Bill 5113, authored by Party-list Reps. Cresente C. Paez and Anthony M. Bravo of Coop-NAtCCO, also aims to give individual tax pay-ers the discretion to allocate 5 percent of their income tax to their preferred charitable institutions or other CSOs that are eligible.

the bill refers to charitable or CSOs as those charitable institutions and other nonprofit and non-governmen-tal organizations (NGOs), including foundations, civic organizations, peo-ple’s organizations (POs), community

organizations, sectoral organizations, cooperatives, micro-finance institu-tions and social enterprises, duly regis-tered with the Securities and Exchange Commission, the Cooperative Devel-opment Authority, the Department of Labor and Employment, Housing and Land Use Regulatory Board or formal accrediting bodies approved for the purposes of this law.

Paez said the 1987 Constitution is believed to be among the first of its kind in the world to recognize NGOs and POs as partners in development. It goes on in stipulating and defining their roles in society.

He added that the Philippine Devel-opment Plan (2011 to 2016) also high-lights the role of these volunteers in pursuing the vision of inclusive growth and President Aquino’s vision of a so-cial contract with the Filipino people.

“the phenomenal contribution civil-society organizations includes its representation of the citizenry. It is the negotiating force between bu-reaucratic power and those who have none, or between those who have the power to make decisions within the formal structure of policymaking and those who lie outside of it,” Paez said.

Bravo said CSOs have expanded to include community empowerment, empowering through self-organi-zation and raise public awareness on significant issues such as rape, sexual harassment and rights for women and children.

“they also engaged in agricultural development by helping farmers and fishermen obtain access to agricul-tural services or by participating in the crafting of policies on the countryside. CSOs also serve as the watchdog over

government agencies that implement various public services and promote public good,” Bravo said.

However, Bravo said, one of the predestined challenges of CSOs are the funding issues. to clear the doubt of bogus CSOs and to make them ac-countable to the public, the approval of this bill is earnestly sought, he said.

Under the measure to be known as “People Fund Act,” individual tax pay-ers shall have the option to allocate 5 percent of their annual income tax to support a charitable or CSOs that the tax payer shall select from a list of eli-gible organizations.

An interagency committee to be led by the Department of Budget and Man-agement (DBM) shall provide the list.

Also, the Bureau of Internal Rev-enue (BIR) is directed to establish the mechanism for an individual tax

payer to allocate 5 percent of income tax yearly to the selected charitable in-stitution or CSO as part of the process of filing annual income-tax returns.

the bill also provides that should an individual tax payer decide not to allocate for any of the listed eligible organizations, the whole amount of the individual’s income tax will go to the government’s general fund.

Moreover, the bill prohibits any in-dividual taxpayer to allocate funds to any eligible organization if he or she is a founder, officer, member or employee of that organization or if he or she is related to any of its founders, officers, members or employees up to the fourth degree of consanguinity or affinity.

Funds received by the benefiting organizations as provided by this act are exempted from donor’s tax or any other taxes. PNA

In a developers’ forum held on Monday at the Metropolitan Club, Creba National Chairman Char-lie A.V. Gorayeb cited a five-point agenda essentially consisting of amendments on existing laws, and institution of new legislative mea-sures for housing. the five-point agenda consists of the following; 1) long term and af-

fordable funds for socialized and eco-nomic housing; 2) affordable homes for employees in urban areas; 3) lands for residential, 4) commercial; and 5) industrial development, efficient and local government housing regu-lations, and full-fledged housing and urban development department. Under provision for affordable funds for socialized and economic

Tuesday, January 13, 2015 • Editors: Vittorio V. Vitug and Max V. de Leon

Creba lists 5-point agenda to address housing backlog

By Catherine N. Pillas

The Chamber of Real estate and Builders Association (Creba) in the Philippines bared

on Monday its five-point agenda to address the 5.5 million housing backlog in the country, citing the need for a P220-billion fund to be drawn from government agencies.

housing, Creba pushed for the a funding mechanism called the Centralized Homebuyer Financing Program (CHFP). the CHFP is designed for home financing assistance to individual home-loan borrowers with no com-ponent for development financing. It is focused on socialized and low-income beneficiaries. the said program aims to tap the funds allocated to government agen-cies for housing by virtue of existing laws, which include those governing the Social Security System (SSS), the Government Service Insurance Sys-tem (GSIS), and the Home Develop-ment Mutual Fund (Pag-IBIG). Particularly, the initial contribu-tions proposed under the program will consist of P25 billion each by SSS and GSIS in housing bonds pursuant to their charters, P70 billion invest-ed by the Pag-IBIG fund in housing bonds, and P100 billion from the unused or residual agri-agra funds of banks to be remitted lump sum in

exchange for two to five years in hous-ing bonds, for a total of P220 billion. Further, the amounts set aside by the agencies enabled by exist-ing laws must be integrated and put under a Housing and Urban De-velopment fund, along with other amounts for housing set aside for housing such as government’s com-munity mortgage program (CMP), among other sources. the fund is proposed to be ad-ministered by the Housing and Urban Development Coordinating Council, which is under supervi-sion of the Office of the President, and should be allocated for land and housing development. the association aims to achieve an annual housing production target of 500,000 units a year, given that the recommended proposals are in place for the next 20 years to cope with future demand. Currently, the annual production of housing is less than 100,000 units a year, Gorayeb said.

Delivery of new fire trucks boosts Clark safety rating

to 20,000 barrels per day by 2017. However, the final divestment of Otto’s 33-percent share is still un-der the decision of its shareholders, which will take place this January.

On the other hand, Otto said it will

still continue to complete the farm-out campaign for SC 55 before drill-ing the Hawkeye-1 exploration well.

the remaining interest in the Galoc block is held by Galoc Pro-duction Company 2 Pte. Ltd. at

26.84 percent, Oriental Petroleum & Minerals Corp. and Linapacan Oil Gas & Power Corp. at 7.79 per-cent, Philodrill Corp. at 7.21 per-cent and Forum Energy Philippines Corp. at 2.28 percent.

Otto Energy is an oil and gas com-pany listed in the Australian Stock Exchange engaged in exploration, development and production. It has projects in the Philippines and tanzania. PNA

Otto Energy estimates lower earnings of $16.66M at Galoc oil field in Q4 ’14

People’s direct participation in funding charitable institutions sought

terminal rush Departing passengers for overseas destinations queue outside the passenger terminal building to check in at the terminal counter and catch their flights due to the ongoing renovation of the Ninoy Aquino International Airport Terminal 1. Airport authorities have confirmed yet another delay in the ongoing construction works for the upgrade of the terminal to May 2015 this year. ReCTO MeRCene

briefsdavao city govt to begin

negotiations on p39-b reclamation projectDAVAO CITY—The city government and the Filipino investor will begin negotiations for the P39- billion proposed reclamation from Magsaysay Park to Bucana River after the project was granted original proponent status.

The grant of original status, according to Ivan Cortez, chief of the Davao City Investment Promotions Center “means the city government will negotiate with the proponent to discuss details of the Terms of Reference [ToR] with the investors in the presence of Neda [National Economic development Authority].”

“This is the first project under Public Private Partnership under the unsolicited program. The negotiations should be completed within 180 days,” Cortez said the presence of Neda will ensure that the ToR and other conditions are both beneficial to the government and the investor.

He added that the negotiations will hopefully strike a better deal with the investor, Mega Harbor. Mega Harbor is a Manila-based investor with three corporations under its name and has done reclamation projects and operating four major ports in Manila, Bacolod and Panay.

Under the plan, the investor will reclaim 150 meters away from the shoreline of Magsaysay Park to the mouth of Bucana River. The reclaimed area would be the site of commercial and tourism areas, seaport, transshipment facilities.

While the project may overlap with Sasa Port operations, Cortez said the project is foreseen to ease burden of time in unloading and loading of cargoes. “It will prevent what is currently happening in Manila Port,” Cortez added.

Cortez disclosed that the implementation of the project is targeted to start by 2016 and completed in 2019. “This year will be for the completion of permits and documents,” he said. PNA

dti-12 opens new display center for local productsGENERAL SANTOS CITY—In a bid to enhance the promotion and marketing of local products, the Department of Trade and Industry (DTI) in Region 12 has opened a new display center for various local products in a shopping mall here.

Richard Arceño, DTI Region 12 information officer, said on Monday that the expanded pasalubong center at the SM mall here is now fully operational, catering to products from 113 micro, small and medium enterprises in the region.

He said the facility serves as the main display area for unique handicrafts and food products made out of raw materials that are available in Region 12.

Also known as Soccsksargen, Region 12 comprises the provinces of South Cotabato, Sultan Kudarat, Sarangani, North Cotabato and the cities of General Santos, Koronadal, Tacurong, Kidapawan and Cotabato.

Arceño said they pushed for the opening of the new pasalubong center, which is at the second level of the SM mall, to better promote the region’s products that now carry the “Treasures of Region 12” brand.

“The pasalubong center is a component of our product development and marketing strategy for the Treasures of Region 12 brand,” he said in a statement.

Arceño said the center showcases a variety of products like processed fruit jams and jellies, sinamak vinegar, pinasugbo, banana and taro chips, processed tuna, native coffee, cacao tablea, and fruit juices like mangosteen, passion fruit, calamansi and guyabano concentrate.

Also on display are unique handicrafts made of bamboo, beads and brass as well as fashion accessories and other collectible items, he said.

[email protected] Tuesday, January 13, 2015 A5BusinessMirrorEconomy

Court insiders said the magis-trates have included in their agenda the four petitions filed by Bagong Alyansang Makabayan (Bayan), for-mer Rep. Augusto Syjuco Jr. of Iloilo, Party-list Rep. Neri Colmenares of Bayan Muna and United Filipino Consumers and Commuters last week questioning the legality of the recent fare hikes in Light Rail Transit

(LRT) Lines 1 and 2 and Metro Rail Transit (MRT) Line 3.  The magistrates are expected to act on the prayer of the petitioners for the issuance of a temporary re-straining order (TRO), or a status quo ante order, enjoining the De-partment of Transportation and Communications (DOTC) from implementing its order allowing

sc tackles power and railway fare-rates hikeBy Joel R. San Juan

THE 15-man Supreme Court is set to tackle various petitions seeking an immediate relief from

increase in electricity and fare rates when it resumes its session on Tuesday after a monthlong holiday recess.

the fare increase.  An increased base fare of P11 for both the LRT and MRT, start-ing January 4, with an additional P1.00 charge for every kilometer. The fare adjustments would jack up the fares of LRT 1 from Baclaran to Roosevelt Stations and vice versa to P29 for a one-way trip from P12 and P15 at present; LRT 2 from San-tolan to Recto Stations and vice versa to P24 from about P20; and the MRT 3 from North Avenue to Taft Avenue stations and vice versa to P28 from P10 and P15 at present.    The source added that the justice in charge of the case has already come up with a recommendation, which will be voted upon during the session.  The petitioners refused to accept the government’s justification for the fare increases, saying that the LRT and MRT railways are “public

services” and must be “subject to regulation, and their fare rate may not be adjusted unilaterally.” “As public services, they are subject to regulation, not only as regards their route and the quality of service they offer to the public, but also as regards the manner of fixing the rate of fees that they im-pose for the use of their services,” the petitioners said. “As a consequence, they can-not unilaterally increase the rates without prior notice and hearing, and without the prior approval by a regulatory agency which should look into the propriety of such rates before they can be implemented,” they added.  The petitioners added that the fare increases are void since Transportation Secretary Joseph Emilio A. Abaya has no quasi-judicial power to determine fare

rates for LRT and MRT. They added that it is the Land Transportation and Franchising Board (LTFRB) which has the right to exercise such function. The Court is also expected to deliberate on the plea for the issu-ance of a TRO by a lawyer  to stop the Energy Regulatory Commission (ERC) from implementing its or-der allowing state-owned National Transmission Corp. (Transco) to charge consumers an additional P0.04 per kilowatt-hour in their electric bills starting this month to pay for the cost of renewable energy (RE) used under the feed-in tariff (FIT) scheme. In his petition, lawyer Remigio Michael Ancheta said  a usual resi-dential Meralco customer consum-ing 200 kwh in a month should expect an additional charge of P8.12 under the FIT system.

By Jovee Marie N. dela Cruz

APARTy-LIST lawmaker on Monday scored water conces-sionaires Maynilad and Ma-

nila Water for their alleged continu-ing noncompliance of their contracts with the government. Party-list Rep. Lito Atienza of Buhay, in a news statement, said that during his term as secretary of the Department of Environment and Natural Resources (DENR), he sued Maynilad and Manila Wa-ter for failing to comply with the terms of their contracts. “They failed to provide waste water treatment facilities—some-thing which they have yet to fully accomplish but have been charg-ing consumers from the start.  As a result, they were fined P200,000 per day of non-compliance. Records show that from May 7, 2009 until January 2015, the running total has reached P414,600,000 in fines,” Atienza said.  “What’s worse, up to now, the consumers are the ones bearing the burden of the special privileges granted to them in the said con-tracts,” Atienza added.  The lawmaker also said that due to the absence of waste water-treat-ment facilities, household waste and sewage from Metro Manila and surrounding provinces has continually been discharged into the Pasig River and subsequently into Manila Bay. “[The practice is] virtually killing the [Manila] Bay and rendering it as one giant pozo negro. Technically, all household wastewater should be cleaned as part of the service to be provided by Maynilad and Ma-nila Water. But instead of doing so, consumers are even charged for a service that is not being rendered to them,” he said.  Atienza added that in progres-sive cities like Hongkong, Sin-gapore and Malaysia, household waste and liquid that has been processed through the wastewater treatment facilities come out clean, and is even safe for drinking.  Atienza also cited the provi-sion in the water concessionaires’ contracts that allowed them to secure loans from foreign finan-cial institutions with sovereign guarantees, tax-free.  “These contracts have given the concessionaires the privilege of securing loans from foreign financial institutions tax-free, but with the Filipino consumers ending up bearing the burden of paying taxes for them. And, as if this wasn’t enough, now Maynilad and Manila Water even have the nerve to ask for an increase in wa-ter rates,” Atienza said. 

Solon: Metro water concessionariesnon-compliant with contract terms

By Leslie D. VenzonPhilippines News Agency

THE government expects to roll-out more Public-Private Partnership (PPP) projects for local government units (LGUs) follow-

ing the approval of the P400-million Tanauan City Public Market Redevelopment Project in Batangas.

The public market redevelopment project is the first LGU PPP project approved by the Investment Coordination Committee – Cabinet Committee (ICC-CC) under the current PPP Program.

“We look forward to more local PPP initiatives facilitated by the Center’s PPP capacity building strategy for local governments,” PPP Center Execu-tive Director Cosette V. Canilao said.

The current pipeline of projects of the PPP Pro-

gram has several LGU-initiated projects. The Tanauan City government plans to com-

mence PPP bidding of the public-market redevelop-ment project within the month and expects to award the same to the best private partner in March 2015.

Initiated by the city government through capac-ity building support by the PPP Center, the project will involve a commercial mall building, as well as separate wet and dry public-market facilities.

The redeveloped public market will generate em-ployment for the local communities in the city and nearby municipalities as well as improve storage and market facilities for local business. It is also expected to reduce traffic in this part of Batangas by significantly improving the turnaround time for transporting goods and wares to and from the public market. PNA

By Lorenz S. Marasigan

THE local airline regulator slapped budget car-rier Cebu Pacific on Monday with a measly fine for its “botched handling of passengers”

during the holiday rush last month.  Civil Aeronautics Board (CAB) Executive Direc-tor Carmelo L. Arcilla said the three-agency panel that investigated the “mayhem” at the Ninoy Aquino International Airport (Naia) Terminal 3 concluded that Cebu Pacific breached its franchise, and there-fore deserves to be fined with P52.2 million.  “Cebu Pacific clung to its arguments that, while it committed lapses in the handling of passengers, the main contributory factor to the disruption was air traffic congestion and terminal infrastructure deficiencies. After considering all available data and arguments, the board concluded that the main culprit was Cebu Pacific’s operational lapses and mishandling of passengers,” he said in a text message.  The airline regulator said his agency “issued a strong reprimand and imposed a fine against Cebu Pacific in the amount of P52.21 million.” The fine, he noted, is “based on a finding by the board that Cebu Pacific’s operational lapses and passenger mishandling constitutes a breach of the basic condition of its Certificate of Public Convenience and Necessity, i.e., to provide proper, suitable, convenient, safe, adequate and reliable air transportation services.” Cebu Pacific, Arcilla added, is also required to establish and maintain appropriate service stan-dards for all its personnel, organic and outsourced, especially those manning the check-in counters.  The airline of taipan John L. Gokongwei, data showed, had lackluster operations from December 24 to 26, with a total of 20 canceled flights and 288 delayed flights at the Naia Terminal 3 during the three-day period.  This prompted the government to launch an investigation against the said malpractice.  Cebu Pacific blamed the delays and the disloca-tion of a large volume of passengers were caused by air-traffic congestion, coupled with the weather condition on December 24, resulting in a spillover of traffic to the next day. The fiasco, it added, was also fueled by the large number of absentee check-in personnel that resulted in the delayed processing of passengers. First Grade Holdings Inc. Managing Director Astro C. del Castillo said the decision of the regulator to slap fines and reprimand the airline might have immediate effects on its shares listed at the local bourse.  “This might have an immediate reaction from investors, but the fundamentals remain attractive. However, the fine might create a dent at the bottom line of Cebu Air Inc.,” he told the BusinessMirror over phone.  The announcement was a few hours shy from the closing of the stock market on Monday. Shares of Cebu Air closed on Monday at P84.50 apiece, up by 0.6 percent from Friday.  Cebu Pacific officials were not available for comment.  The dominant budget carrier offers flights to 28 international destinations—namely, Bali, Bangkok, Beijing, Brunei Darussalam, Busan, Dammam, Dubai, Guangzhou, Hanoi, Ho Chi Minh, Hong Kong, Incheon (Seoul), Jakarta, Kota Kinabalu, Kuala Lumpur, Kuwait, Macau, Nagoya, Narita, Osaka Phuket, Riyadh, Shanghai, Siem Reap, Sin-gapore, Sydney, Taipei and Xiamen.

CAB slaps Cebu Pacific P52.2-M fine over holiday-rush ‘mayhem’ at Naia 3

ICC approves first LGU PPP project

‘pope biscuits’ Lilian Borromeo, 74, carries a tray of freshly baked “pope biscuits” at the backyard of her house in Mexico, Pampanga. Borromeo was inspired to bake the biscuits because of her devotion and admiration to Pope Francis, who is scheduled to visit the country this week. ALYSA SALEN

Tuesday, January 13, 2015

OpinionBusinessMirrorA6

Finding funding: Are PHL SMEs in trouble?

editorial

As we noted yesterday the Pricewaterhouse-Coopers recently released “Emerging Trends in Real Estate Asia Pacific 2015” report had this to say about the Philippine property sector.

“In particular, there is no shortage of local capital and, therefore, limited demand for private equity investors.”

This is a potential positive as long as the local real estate developers are not put in a position of having to borrow too much money. Internally gener-ated funding allows for more flexibility and avoids facing cash flow problems from an overly high a debt service burden. Local and foreign bank loans are, for the most part, readily available to these companies.

However, according to the Asian Development Bank and as discussed in the BusinessMirror yesterday, that may not be true for our small and medium firms (sMEs).

From BusinessMirror, January 12, 2015: “In a working paper, titled “Why Do sMEs Not Borrow More from Banks? Evidence from the People’s Republic of China and southeast Asia,” the Asian Development Bank Institute (ADBI) said that over 70 percent of the funds used by sMEs in the Philippines were internally generated”.

The specifics show the [potential of a variety of problems for the sMEs. “The paper stated that less than 10 percent of these funds were financed by banks; less than 10 percent by supplier credit; and less than 5 percent by eq-uity or stock sales”.

Banks are not providing loans. suppliers are not extending credit terms. The Philippine stock Exchange and the securities and Exchange Commission have not provided a suitable environment for these companies to list and go public, and raise shareholder equity funding.

In other words, if you intend to start a small business, you are on your own when it comes to money. No wonder that so many companies, even large com-panies started as relatively small family-owned enterprises.

In any free market setting, sMEs are always the backbone of the economy, creating the jobs and providing the growth opportunities. Yet based on the data and analysis of the ADBI report, things have not changed much in the Philippines since Jollibee Foods Corp. was first created as a family business four decades ago.

Bank financing, though, is a two-edged sword. Japan, because of its terrible economic problems, is experiencing a huge increase in the number of company bankruptcies. “The business conditions for small and medium-size companies are severe,” said Norio Miyagawa, an economist at Mizuho securities Co. Much of this is due to not being able to pay debts and borrowing.

However, the fact that our sMEs are not able to take advantage of going public to raise funds is not acceptable and needs to be addressed.

AID agencies, local and national government, and communities braced for the worst when Typhoon Ruby (international code name Hagupit), which was upgraded into a super typhoon,

hit the Philippines in the first week of December last year.

THE official Twitter account of the Philippine government made a point this past Friday to inform us that the Philippine stock Exchange (PsE) had closed at an historic high, “the

93rd record high during the Aquino admin”.

Donor fatigue

PSE: What’s the market killer?

THE EnTrEprEnEurManny B. Villar

The typhoon weakened as it passed through the Visayas and Metro Manila, with casualties and damages a fraction of the destruction caused by superty-phoon Yolanda (international code name Haiyan) in 2013.

The  United Nations International Children’s Emergency Fund (Unicef) noted in an online article that “a big part of reducing damage and saving lives was also that communities were prepared.”

still, the National Disaster Risk Reduction Management Counci l (NDRRMC) said the typhoon left 18 people dead and more than 944,000 families affected. Damage to infrastruc-ture and agriculture was estimated at about P5.09 billion.

Ruby was followed by Typhoon seniang, the 18th and last typhoon of the year, which made five landfalls in Mindanao and the Visayas before leav-ing on January 2.

seniang was a weak typhoon, with winds of 65 kilometers per hour and gusts of 80 kph, but it brought heavy rains, which caused massive floods and landslides. As of January 9 the NDRRMC reported more than 123,000 families af-

fected, more than P768 million in losses to agriculture and infrastructure and a total of 66 fatalities.

The last two disasters did not draw as much attention as Yolanda, which trig-gered a global wave of relief and assistance. some local officials, who saw how foreign governments, international agencies and non-governmental organizations poured massive amounts of food, medicines, equipment and supplies in the aftermath of Yolanda, were somewhat disappointed over the absence of the major donors in the areas affected by Ruby.

The disappointment, including the suggestion of a “donor fatigue,” is under-standable, given that some of the areas hit by Ruby were still trying to recover from the destruction wrought by Yolanda.

In fairness, assisting victims of ca-lamities is generally a regular activity of big companies under their corporate social responsibility (CsR) programs. I would like to believe that they also pro-vided assistance during the disasters that visited the country in December, but the amount of assistance was de-termined based on what they perceived was needed.

On my part, disaster assistance is part of the CsR program of my business, mainly through my family’s foundation, the Villar sIPAG (social Institute for Pov-erty Alleviation and Governance) Foun-dation.

I have always believed, however, that helping people should not be limited to emergency relief like food, medicine and temporary shelters. These things are important to keep the victims of calamities from get-ting hungry or sick, or being exposed to the natural elements, as soon as, or right after a calamity strikes. But I also look at the long-term prospects of survival, including making the people well-prepared to face future threats to their lives and properties.

We should, for instance, look at the long-term solution to the problems of Leyte and samar, which were affected by Yolanda and most of the typhoons that visit the country. The main livelihood of people in the two provinces is coconut farming, the poorest segment of the agri-culture sector. It takes years before coco-nut seedlings grow to become productive, so farmers should be assisted and encour-aged to plant crops that are resistant to typhoons, as well as cash crops, or those that can be harvested early.

On my part, I believe in the finan-cial empowerment of the poor, whether they are farmers or urban dwellers. My business has taken me to all parts of the country, and my two decades as an elected official brought me face-to-face with my marginalized countrymen.

I know poverty first hand. I do not have to look at the lifeless statistics. The poor are always the first to fall victim to calamities, and the last to recover.

Thus, poverty alleviation is foremost among my advocacies. Helping people rise from poverty will not only improve their living standards, but will also en-able them to avoid or quickly recover when disaster strikes.

The Villar sIPAG Foundation imple-ments livelihood programs to encourage people to become entrepreneurs. As an added incentive, the foundation con-ducts an annual awards project.

In December 2014, the Villar sIPAG awarded a total of P4 million in cash prizes to the winners of the nationwide search for community enterprises that served as “engines for growth” to help lessen widespread poverty in the coun-try. Each of the 10 winners for Outstand-ing Community Enterprise received P250,000, while 10 winners for Most Promising Community Enterprise each got P150,000.

The Villar sIPAG Awards project rec-ognizes community enterprises as mod-els of good practices in poverty reduction. It honors community enterprises that have been helping their communities in minimizing poverty.

Now on its third year, I intend to continue the Villar sIPAG Awards to encourage more people to become en-trepreneurs.

Incidentally and on a personal note, I don’t suffer from donor fatigue. Recently, I donated P1 million, which I received as retirement fund from 21 years of service in government, to the Roman Catholic diocese of Balanga to support its youth-oriented projects.

For comments, e-mail [email protected]  or visit www.mannyvil-lar.com.ph.

While that is a fact, there is only a casual connection. The reason the PsE hit an historic high last Friday was be-cause the Bangko sentral ng Pilipinas took interest rates to an historic low in August 2007. Without that monetary-policy move, certainly there may have been 20, 30 or 60 new historic highs—who knows or cares—but, first and foremost, it is monetary policy that fueled the stock-market rally.

But none of that matters at all. We did hit a high this past week and now the question is, what will the market do now?

When a stock market reaches a new historic high, there is no “history” that will give us the rationale for whether the market will move higher or lower. At that point, we are in uncharted wa-

ters. One could make sound arguments calling for a temporary or even long-term retracement. You can also advise that a trend has been established and trends tend to go on for an extended time—at least until something comes along to change the trend.

The new financial and geopolitical catchphrase these past years is “black swan.” This sort of event is unpredict-able for the most part, has relatively indefinable consequences and allows for little preparation.

Few events are true black swans, but are instead “hidden lions.”

Hidden lions describe a situation such as walking down a road with heavy brush on both sides, that on the Afri-can savannah usually holds a resting or waiting lion or two. The traveler knows

that there is a strong possibility that the lion is there in the bush. Passing down the road is done with the hope that the lion will not attack. But un-like with the black swan, preparations can be made if one chooses to do so.

The recent terrorist attack in France was not a black swan event. It was a hidden lion. According to media reports, the French authori-ties had been tracking the assailants six months ago but stopped, deeming them “low risk”, a classic hidden lion.

The crash in the price of oil was not a black swan in that we could predict this was coming when global oil sup-ply went higher than demand in 2013 for the first time in decades. That was when countries should have put on their “lion hunting” outfits.

The PsE rally is not going to be killed by a black swan; it will be a hidden lion.

A major earthquake hitting Metro Manila is probably as close as we will get to a local black swan event in that we cannot adequately prepare. It’s the hidden lion about which we need to be concerned.

Looking at the third-quarter 2014 financial statements of some large PsE-listed companies, many of them increased their debt load from the sec-ond quarter and over the same period in 2013. This is understandable both

in that these firms are preparing cash for 2015 expansion and in anticipa-tion of higher interest rates globally if not locally.

We must always be cautious of the debt lion, especially in these current times. While I see a favorable medium-term future for PsE-listed stocks, in the next weeks, 2014 financial numbers will be released and I will be looking very closely for any lions in the bush.

It is not likely that any of these companies will have over extended themselves as far as their debt goes. It is almost impossible that there would be any problems with servicing that debt. However, this is something that we must always be careful about.

Corporate profits are important but more so in the short term than in the long run, as a short-term profit prob-lem can have a more negative impact on stock prices. Long-term profit prob-lems usually show up in stock prices down the road.

But too much debt today is guaran-teed to be a bigger problem tomorrow.

E-mail me at [email protected]. Visit my web site at www.mangunon-markets.com. Follow me on Twitter @mangunonmarkets. PSE stock-market information and technical analysis tools provided by the COL Financial Group Inc.

OuTSIDE THE BOXJohn Mangun

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01132015

Tuesday, January 13, 2015

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Torture on the tollways

After undergoing an excruciating 11-hour road trip from Manila to Baguio during the Christmas holidays, an upset Senate President franklin Drilon said he would

file a resolution calling for a Senate investigation into the horrible traffic that greeted motorists who drove through three interconnected tollways—North Luzon expressway (Nlex), Subic-Clark-tarlac expressway (SCtex) and tarlac-Pangasinan-La Union expressway (tPLex).

ABOUT TOWNErnesto M. Hilario

“I will call a hearing exclusively for this purpose so that we could come up with a solution regarding this problem…. I can’t understand why the collection of toll fees can’t be integrated, so that only one en-tity handles the collection. It’s not rocket science.”

Arnel Paciano Casanova, presi-dent of the Bases Conversion and Development Authority (BCDA), hastened to console the countless motorist-survivors of the December 26 carmageddon at the Nlex-SCtex-tPLex “parking lot.” He averred that the traffic nightmare will go away soon enough, as the BCDA al-ready approved last November an integration plan that would reduce the number of toll-collection plazas in the three toll roads and there-by speed up vehicular traffic for both northbound and southbound motorists.

But why did the BCDA put this integration plan in the freezer for over five years, considering that it was proposed—according to Manila North tollways Corp. (MNtC) Presi-dent rodrigo franco—in 2009 yet?

Metro Pacific tollways Develop-ment Corp. submitted an unsolic-ited offer on September 17, 2009, to manage, operate and maintain SCtex, a key feature of its tech-nical proposal was the operation of SCtex and Nlex as “one inte-grated and contiguous expressway network.”

this meant reconfiguring certain toll plazas and interchanges to ex-pand plaza capacity.

When MNtC and the BCDA entered into a Business and Op-erating Agreement (BOA) on July 20, 2011, covering the assign-ment by the BCDA to MNtC of the

concession over the SCtex, this deal was anchored on the former’s payment to the latter of conces-sion fees and its performance of certain or “committed” mainte-nance works.

As stated in the technical pro-posal that MNtC had submitted to the BCDA, one of such “com-mitted” maintenance works is the integration of SCtex with Nlex to ensure the “interoperability of the toll collection system” of both expressways.

this will be achieved, said the technical proposal, “by modifying the toll-collection system of SCtex through installation of devices and peripherals, reconfiguration and expansion of toll plazas, introduc-tion of electronic toll system and software modification.”

But even if the BOA was executed in July 2011, the obligation of the BCDA to turn over the manage-ment, operation and maintenance of SCtex to MNtC has not become ef-fective due to the pending approval of the Office of the President, one of the conditions precedent for the takeover by MNtC of SCtex, our research showed. 

then, in March 2014, MNtC presented to the BCDA the idea of advancing the implementation of the Nlex-SCtex Integration as a way to ease the mounting traffic congestion in certain choke points along Nlex and SCtex, especially during peak seasons.

On April 8, 2014, MNtC for-malized the proposal to advance the implementation of the inte-gration as a stand-alone project. the proposed integration aims to provide motorists seamless travel from Nlex to SCtex and vice versa;

adopt a common transit ticket system that will make operations more efficient and enhance motor-ists’ convenience; and use the Nlex electronic toll Collection Dedicated Short range Communication sys-tem (or the easytrip tAG) for SC-tex, to increase subscription and throughput capacity for both Nlex and SCtex toll lanes.

Such integration will involve, among others, (1) upgrading SCtex’s collection system to make it com-patible with that of Nlex, and (2) removal of the Nlex Dau toll Barrier and SCtex Mabalacat toll Barrier, plus the construction of smaller toll plazas at the Dau, Santa Ines and Mabalacat entry and exit points.

the question, therefore, is: Why is the BCDA taking so long in act-ing on this Nlex-SCtex Integra-tion plan?

Czechs helping Yolanda rehab tHe Czech republic has been qui-etly extending significant humani-tarian assistance to the victims of Supertyphoon Yolanda on eastern Samar, Panay, Negros and Leyte islands.

Among the international agen-cies assisting in rehabilitation ef-forts is the Adventist Development and relief Agency (ADrA), a hu-manitarian agency that implements community rehabilitation and risk- reduction programs.

In Makato, Aklan, the ADrA pro-gram, jointly funded by the Czech republic, the United Kingdom and Norway, addresses the need of com-munities displaced by Yolanda for more durable housing solutions and sustainable shelter assistance. the counselor of the Czech embassy in Manila, Jan Vytopil, who recently

visited Makato, notes that “with thousands of houses destroyed, housing and rebuilding of homes be-came necessary factors for the com-munities to be able to start anew.”

the Czechs built 83 new houses and repaired 101 more.

Aside from receiving construc-tion materials, the communities were also given regular orientations by shelter specialists on structure building and were given shelter kits, which can be used for emer-gency shelter repairs. “the aim was to ensure that, especially the most vulnerable, people would live in de-cent conditions. New homes were no longer built in the immediate vicinity of the coast, so that they were not again exposed to the dan-gers of another disaster,” said Jana Škubalová, project coordinator of ADrA Czech republic.

On the other hand, the ADrA Philippines program in Ajuy, Iloilo, addresses the postdisaster liveli-hood needs in the municipality. their Boat repair Assistance Grant project successfully distributed 357 boat-repair material kits to assist fishing households whose boats were damaged by Yolanda. fur-thermore, 1,187 fishing kits were distributed to local fisherfolk, while 15 fiberglass boats were given to select families.

to enable the families in Ajuy to have an alternative source of means while rebuilding their com-munity, ADrA also implemented the Cash for Work program, where beneficiaries earned P245 per day while participating in various livelihood-restoration activities like coastal cleanup, net weaving and mangrove planting. A total of 33 barangays in Ajuy have also received disaster-risk reduction (Drr) trainings and vital Drr kits, which include early-warning devices and lifesaving equipment in order to strengthen the commu-nities’ resilience against natural disasters.

Czech A mbassador to the Philippines Jaroslav Olša Jr. has pledged that “the government of the Czech republic will continue to support humanitarian and small development projects that aim to rehabilitate communities affected by natural calamities in the Philippines.” 

E-mail: [email protected].

Edgardo J. Angara

POPe francis is only human. He has favorites and strange ones, too. Why, he is even partial to the charismatic renewal movement. far from seeing them as a threat to the Church—

as Western media consistently portrays it so as to put down the Catholic Church because the West fears its power—Pope francis has regarded them as a much-needed injection of new blood in the tired veins of the old Church.

The white rose

IN naming Pope francis as 2013’s Person of the Year, Time magazine dubbed him the “People’s Pope,” narrating how, as an archbishop, he would pay regular visits to the poor barrios of Buenos Aires,

often by himself and, at times, on foot.  IN the reagan era, conservative republicans felt they had a powerful ally in Pope John Paul II, whose forceful anticommunism and anti-abortion stances played out in

American politics.

Pope Francis of the poorPope Francis rattles US conservatives

He has greatly improved the im-age of the Vatican as his sensibilities appear close to that of ordinary folk. After becoming pontiff, he chose as his residence a small suite in the Vati-can hotel over a luxurious 12-room apartment at the Apostolic Palace. Currently, he opts to move around in a humble ford focus instead of the bulletproof papal limousine. 

even the name he adopted indi-cates his bias for the poor—taking it from Saint francis, the Poor Man of Assisi, who in the 13th century exemplified a return to the Gospel of poverty, universal brotherhood and peace to move away from the divisive politico-religious systems that prevailed at the time.  

Saint francis said sharing in Christ’s sufferings on the Cross com-prised the “perfect joy.” Pope francis (née Jorge Mario Bergoglio) calls for a clergy who share in the day-to-day lives of their congregation.  Since his days as a priest, he expressed his ad-miration for clergymen that, in his own words, “smelled of their flock,” saying that the Church should be “like a field hospital after battle” that is, down in the trenches. 

At t he World Meet ing of

Popular Movements (a gathering of grassroots organizations), he issued a mini-encyclical lament-ing the “scandal of poverty” and explaining how access to “land, roof and work” are sacred rights.  He emphasized “a love for the poor was at the heart of the Gospel” and comprises the Social Doctrine of the Church.  

Pope francis may not be the first of Saint Peter’s successors to speak up about poverty and the Church’s mission of service to the excluded and marginalized.  But he is, per-haps, the first pope in recent history to do so while turning a critical eye on the Church, itself hounded and weakened by criticism and scandal.

His visit will definitely spark hope among the downtrodden, but should also serve as a catalyst to re-form and inspire local church lead-ership like Luis Antonio Cardinal G. tagle and Catholic Bishops’ Con-ference of the Philippines President Archbishop Socrates Villegas to lead the Church (especially its clergy) to a self-assessment and return the Church to its roots. 

E-mail: [email protected].

today’s conservatives are appre-hensive about Pope francis, who has changed the tone and culture, not the doctrines, of the Catholic Church in less than two years as pontiff. He stresses, with passion and authenticity, a commitment to addressing poverty and income in-equality more than the social issues that have dominated much of the Catholic debate in America.

John Carr, a former top official of the US Conference of Catholic Bishops, notes that francis’s mes-sage on abortion is “no obsession, no retreat.”

the pope helped broker the re-cent thaw in US-Cuban relations, to the consternation of conservatives such as florida Sen. Marco rubio. francis now is determined to make addressing climate change a moral imperative for the world’s 1.2 bil-lion Catholics.

this doesn’t mean that francis is the poster pope for liberal Demo-crats: “He’s challenging everybody,” says Carr, now director of the Initia-tive on Catholic Social thought and

Public Life at Georgetown Univer-sity. “Most Democrats haven’t been talking about poverty.”

He suggested that francis’s im-pact is starting to change the con-versation among Democrats, along with some conservative republi-cans, such as House Ways and Means Committee Chairman Paul ryan of Wisconsin.

Still, francis’s message is unset-tling to more than a few conser-vatives, particularly his focus on climate change and his initiatives to influence the United Nations’s conference in Paris this year. Some prominent republicans, such as Senate environment Committee Chairman James Inhofe, are cli-mate-change deniers.

Some Catholic business leaders have complained about francis’s emphasis on income inequality and the defects of capitalism. Ken Lan-gone, the billionaire founder of the Home Depot and a major republi-can donor, warned Cardinal timo-thy Dolan of New York that if the pope kept up the drumbeat, some

wealthy Catholics might stop giv-ing to church causes. (“Liberals say popes don’t know anything about sex, conservatives say they don’t know anything about economics,” Carr observed.)

And francis has rattled the US church hierarchy, notably the bishops. American church leaders have long been advocates for the poor and immigrants. But these are edicts many conservatives felt could be ignored; the focus and pri-orities were the social issues, led by hard-line prelates such as Cardinal raymond Burke, the former arch-bishop of Saint Louis, who refused communion to any Catholic politi-cians who weren’t on the right side of the abortion issue.

francis removed Burke as head of the Vatican’s high court. Burke, a francis critic, recently asserted that a “feminized” church, which per-mits altar girls, is responsible for a

shortage of priests and some of the pedophilia crimes. equally impor-tant, the pope chose Blase Cupich, the progressive bishop of Spokane, Washington, to be the archbishop of Chicago, the third-largest American diocese. He succeeds Cardinal fran-cis George, a conservative cultural warrior.

Garry Wills, a renowned histo-rian and Catholic scholar, said the pope has sent a strong message to entrenched interests such as those that oppose Obamacare for offer-ing contraception coverage, even though the vast majority of Ameri-can Catholics practice birth control.

“francis has condemned career-ism, which will make the bishops pay more attention to Catholic lives,” Wills says.

the pope will visit the US in Sep-tember. He’ll go to Philadelphia and New York and probably Washing-ton. If so, look for visit to the White House, as well as to a soup kitchen or some other venue that serves the poor, and he might accept House Speaker John Boehner’s invitation to be the first pontiff to address a joint session of Congress.

Privately, some right-wing re-publicans have grumbled about this invitation, but they can’t block it. It’s not hard to envision an excep-tional moment in the Capitol as pro-choice Democrats squirm when the pontiff celebrates the sanctity of life and republicans wriggle when the Holy father talks about social justice, income inequality and the moral imperative of addressing cli-mate change.

FrEE FirETeddy Locsin Jr.

At a huge charismatic gather-ing, he gave a thumping speech when he was a cardinal, making the most extravagant gestures and peppering his message with exclamations of “Praise the Lord” with the best of the lay preach-ers. they were stunned. One revivalist leader wanted to re-turn formally to the Church but, writes his biographer, Austen Ivereigh, Cardinal Bergoglio told him not to do it; the Church didn’t need more of the same; it needs new blood, fresh perspectives, a fresh enthusiasm—to borrow the words of the great Catholic writer ronald Knox. He feels the same way about Orthodox Christians; if they converted en masse to rome, Catholicism would lose Orthodox Christianity’s different way of thinking about and praying to God. Pope francis is also close to the Sant’ejido Community with its vi-sion of a church for the poor, writes Ivereigh; to focolare with its call for encounter; to the Communion and Liberation Movement—and to Opus Dei whose founder, Saint Jose Maria escriva, he holds in the most prayerful regard. And then there is his strange, even mystical relationship with Sis-ter therese of the Child Jesus and of the Holy face to whom he turns in his hard trials. “When I have a prob-lem,” said francis, “I ask the saint not to solve it but to take it in her hands and help me to accept it. As a sign, I almost always receive a white rose.” Undecided how to proceed at a critical juncture, he found three white roses at the doorstep of the sacristy. “So Santa teresita’s

been in, I see,” he said. time and again, after stepping out of his office, he found white roses on his desk when he returned and once, at a church outside Bue-nos Aires, a woman came up with a big bunch of gleaming white roses. “Are they for the virgin?” said the priest who met her. “No, for the cardinal,” she said, handing the flowers and leaving without giving her name. After a huge outdoor Mass when he still had to walk 10 blocks through a milling crowd, the pain in his legs was unbearable so that he felt he would not make it and called for the car to pick him up. But when he turned a corner he ran into a big burly man who had his hand inside his coat. Suddenly the man whipped out what might have been a gun in violent Buenos Aires fashion, but instead pulled out a white rose and gave it to the cardinal. His companions were stunned, which goes to show how helpless they would have been to protect him from an assassin’s bullet. Before any of them could react the man vanished. Bergoglio said, turning the white rose in his hand, “tell the driver to meet us at the soccer stadium as planned; I prayed to Santa teresita and she came across again.” At the Vatican he would find a white rose after his election. the miracles are al-ready happening though if he read something like this, it would truly infuriate him, as he has no more aspiration to be canonized than he has to be elected pope. He just wanted to be a leading influence in the Society of Jesus.

BLOOMBErG ViEWAlbert r. Hunt

Garry Wills, a renowned historian and Catholic scholar, said the pope has sent a strong message to entrenched interests such as those that oppose Obamacare for offering contraception coverage, even though the vast majority of American Catholics practice birth control. “Francis has condemned careerism, which will make the bishops pay more attention to Catholic lives,” Wills says.

But even if the BOA was executed in July 2011, the obligation of the BCDA to turn over the management, operation and maintenance of SCtex to MNtC has not become effective due to the pending approval of the Office of the President, one of the conditions precedent for the takeover by MNtC of SCtex, our research showed.

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2ndFront PageBusinessMirror

www.businessmirror.com.phTuesday, January 13, 2015

CAMPI SALES UP 30% IN 2014By Catherine N. Pillas

The local automotive industry had another banner year in 2014, as sales jumped by 30 percent to 234,747

units from 181,283 units in 2013, the Chamber of Automotive Manufacturers of the Philippines (Campi) said. Campi President Rommel Guetierrez said the record performance of the local auto sector was backed by robust sales in all vehicle segments. Figures released by Campi and the Truck Manufacturers Association (TMA) showed that the passenger car segment recorded the highest year-on-year growth rate at 48 percent. A total of 90,287 units of pas-senger cars were sold in 2014 compared to 61,083 units in 2013. “This growth in the passenger car sales was largely fueled by the successful intro-duction of several new models and wider acceptance of small car product category,” Gutierrez said. The commercial vehicle segment also performed well as sales rose 20 percent to 144,460 units in 2014 from 120,200 units in 2013. Among commercial vehicles, the light commercial vehicle segment posted sales of 93,589 units last year, or 26 percent higher than the 74,398 units sold in 2013. Top market performer last year was Toy-ota Motors Philippines Corp., which sold 106,110 units, accounting for 45 percent of market share. Mitsubishi Motors ranked second with a 21-percent share followed by

Ford Philippines, Isuzu and honda. For 2015 Campi and TMA expect car sales to reach 272,000 units, or 16 percent higher than the volume of vehicles sold last year. The continuous expansion of the coun-try’s economy, increase in government spending in preparation for next year’s national election and the decline in world fuel prices are expected to boost car sales this year. Gutierrez expressed confidence that auto sales this year could easily exceed 300,000 units. he said this “fearless fore-cast” is well within well the growth projec-tion the industry submitted as part of the road map where 2015 would be the year when the market is expected to breach the 300,000-unit mark. “The challenge remains to be for the local assembly sector to maintain or even increase its share of this growing market and that the industry continues to wait for the announcement of the appropriate initiative package from the government to make this happen,” he said. Campi said locally assembled vehicles accounted for only 37 percent, while im-ported vehicles accounted for 63 percent of cars sold in 2014. Gutierrez said the small passenger car segment will continue to attract young pro-fessionals in the growing business-process outsourcing sector. Campi also projected an increasing de-mand for sport-utility vehicle and light commercial vehicles mainly due to the worsening weather pattern.

BSP: FDI inflows continue to top government targets

By Bianca Cuaresma 

Foreign direct investments (FDi) in the first 10 months, the kind that remains invested

for the long haul, is already more than $900 million, beyond the target level in 2014, the Bangko Sentral ng Pilipinas (BSP) said on Monday.

PHL 100% rEAdy for PAPAL vISItBy Butch Fernandez

& Jovee Marie N. dela Cruz 

ThRee days before the arrival of Pope Francis in the country, officials of the government and the Catholic Church in the country said on Monday

that the Philippine is “100-percent ready.” All government offices concerned are now on full alert for the much-awaited visit of the pope, accord-ing to Presidential Communications Operations Office Undersecretary Jess Yu. “We are all 100-percent ready, however, we are fine-tuning some security matters for the historic visit,” Yu told reporters following a news conference on the five-day papal visit.  Communications Secretary herminio B. Coloma Jr. said during the media briefing that the Philippine National Police, Metropolitan Manila Development Authority and other security officials conducted a simu-lation of the papal convoy and motorcade on Monday. “The dry run [was held] from Villamor Air Base in Pasay City to the Apostolic Nunciature in Manila, where Pope Francis will be staying during his visit,” Coloma said.  he said the convoy ran through Andrews Avenue, Roxas Boulevard and Quirino highway in Manila.  Bishop Ruperto Santos of the Diocese of Balanga, head of the Committee on Transportation for Papal Visit, said the three popemobiles are now ready for use. The popemobiles will be used in Manila and Tacloban. “The three popemobiles are ready. These are now under the custody of the government for security,” Santos said. he said the popemobiles were blessed by Ma-nila Archbishop Luis Antonio Cardinal Tagle on January 5. Santos said two of the popemobiles were made by local auto assemblers, while the other one was manufactured by South Korean automaker Kia. The Kia Popemobile was used by Pope Francis during the Asian Youth Day in South Korea in August 2014.  One of the popemobiles, a customized Isuzu

D-Max, will be used by the pontiff upon his arrival at the Villamor Air Base on Thursday. A jeepney-style popemobile will be used to ferry the pontiff to Quirino Grandstand, where will hold Mass on Sunday. “The Kia Popemobile will be used in Tacloban. All the popemobiles were made according to the specifi-cations of the Vatican,” Santos said. Pope Francis will stay in the country from January 15 to 19 to visit survivors of Supertyphoon Yolanda in Leyte, particularly in Palo and Tacloban, and to in-teract with Filipino youth and families in Manila. Yolanda slammed eastern Visayas and parts of Western and Central Visayas on November 8, 2013, killing 6,300 people and rendering millions homeless. Meanwhile, President Aquino said Pope Francis is expected to issue an encyclical on climate change and the imperative for all of humanity to take action. The President made the disclosure before he pro-posed the traditional toast during the New Year’s vin d’honneur rites he hosted for members of the diplomatic corps and international organizations in Malacañang on Monday. Vice President Jejomar C. Binay, Senate President Franklin Drilon and their wives were among the guests during the vin d’honneur. Mr. Aquino, however, did not delve into the details of the awaited papal encyclical on climate change and the need to act fast to avert potential disasters from “increasingly erratic weather patterns caused by global climate change.” “I will not forget how the global community has come together to fight climate change, including the example of his holiness Pope Francis,” he said. Malacañang also aired an urgent appeal for public cooperation with tightened security measures to pro-tect Pope Francis from potential threats during his trips around Manila and Leyte. Based on the official itinerary, Pope Francis is ex-pected to arrive in Manila from Sri Lanka—the first leg of his Asian trip—around 5:45 p.m. on Thursday, and will go on a motorcade to his residence in Apostolic Nunciature in Manila. With Claudeth Mocon-Ciriaco

Get ready to wear short pants at work in summer

It didn’t have to be this way, said Petilla, citing refusal by Con-gress to grant President Aquino’s request to build new power plants, in the belief that commerce and industry could cover the shortfall themselves. The government has been banned from building power plants since 2001. “We asked Congress to give the president emergency powers but when they didn’t give it before Octo-ber, the power plant option is dead because it’s too late to build one now for use in summer.”

The bigger issue, according to James Lago at PCCI Securities Bro-kers Corp., is that the government misjudged power needs. “This shortage is due more to the government’s short-sightedness than the private sector,” he said. “The private sector has been willing to build but they are faced with hur-dles the state could have addressed.”

demand surgeThe Southeast Asian nation’s de-mand for electricity has surged as its economy expanded. Consump-tion rose 50 percent to 72,922 giga-watt hours in the 10 years to 2012,

three times as much as the 16-per-cent growth in generating capacity over the same period, according to government data. The Philippines now has Asia’s highest electricity rates after Japan, making power suppliers the biggest winners from the increase. Shares in First Gen Corp., which is adding 514 megawatts of capac-ity this year and in 2016, surged 95 percent in 2014 in Manila trading. Its unit energy Development Corp. rose 54 percent. Trans-Asia Oil & energy Development Corp., which has built its first wind power project, jumped 59 percent. Bloomberg News

Continued from A1

According to the BSP, FDI from January to October aggregated $5.32 billion on net basis, an indication of the positive long-haul view of foreign fund managers who regard the Philippines as a lucrative investment destination at a time when the potential return of a foreign-currency investment is close to zero. Based on BSP data, capital put in by international investors in the Philippines seeking long-term returns surged in Octo-ber last year and exceeded the government’s target anew. The BSP reported on Monday that FDI doubled to $444 million in October last

year, from only $219 million in October of 2013. Compared to the previous month, how-ever, the net FDI inflows slowed a bit in October from the $680 million the BSP reported the previous September. This pushed the total FDI to $5.32 billion in the first 10 months of 2014. This was also 64.1 percent higher than only $3.24 billion worth of FDI a year earlier.  According also to the BSP, this was the second consecutive month that the FDI net inflows exceeded the revised target of $4.4 billion for 2014. “The marked increase in FDI net in-

flows during the month was largely at-tributable to the surge in net equity capi-tal placements to $213 million, from $73 million in the previous year,” the central bank said. This, according to the central bank, was an indicator of favorable investor regard for the Philippines and how its so-called macroeconomic fundamentals are managed by its fiscal and monetary authorities.  equity capital investments for the period came mostly from the US, hong Kong, Japan, Singapore and Taiwan. The investments were channeled mostly to the financial and insurance, manufactur-ing, real-estate, wholesale and retail trade, and the transportation and storage sectors. Placements of foreign direct inves-tors in debt instruments issued by local affiliates also expanded by 55.4 percent to hit $3.3 billion in October 2014, from the $2.1 billion seen in the same month in 2013. FDI are favored over the more volatile and flighty portfolio investments, also known as “hot” or speculative money, which dart in and out of markets quickly as the rewards prove greater and the risks significantly lower. FDI are typically invested in so-called brick-and-mortar businesses in the Phil-ippines that generate not only employ-ment for Filipinos but tax revenues for the national coffers.