BusinessMirror January 26, 2016

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Second of three parts

THE Philippines is struggling to be as competitive as its neighbors in the Asia-Pacific region in developing its own digital economy. Unfortunately, its efforts have not been

enough to compete head-to-head with its peers due to inadequate infrastructure and the unbalanced allocation of broadband spec-trums to local players.

Several studies conducted by Internet metrics providers showed that the Philippines has one of the slowest Internet speeds in the region. In a study published last year, Ookla listed the Philippines as the country with the second-slowest aver-age download speed among 22 nations in Asia, with an average speed of 3.64 megabits per second (Mbps).

The Philippines ranked 176th out of 202 nations around the world. Philippine broadband speed, the study noted, is also eight times slower than the global average broadband-download speed of 23.3 Mbps.

Separately, Cloud services provider Akamai Technologies found

JG Summit Holdings Inc. expects its Philippine budget airline to carry a million more passengers this year,

as decade-low prices for crude oil flow through to cheaper fares. Cebu Air Inc. will probably carry more than 19 million passengers this year, up from more than 18 million in 2015, Presi-dent Lance Gokongwei said in a January 20 phone interview.

JG Summit, which also owns 27 percent of the Manila Electric Co., thinks power

use will rise, as cheaper fuel drives down electricity costs. The conglomerate’s pet-rochemical unit, which runs on feedstock from refined fuel, also will be more com-petitive, Gokongwei said. Cheap fuel “is positive for us, since we’re a transportation, manufacturing and in-dustrial group,” said Gokongwei, 49. “We always had a good balance sheet. Now is the opportunity to strengthen it further.”

Cebu Air rose 0.5 percent to P76.40 as of 10:19 a.m. in Manila trading, while

JG Summit gained 2.2 percent to P61.30. The Philippine Stock Exchange Composite Index advanced 1.4 percent.

Some drawbacksGOKONGWEI said the drop in fuel prices does have its downsides. “First is that fuel surcharges have been removed, so that has reduced yields” on Cebu Air flights, he said. “Second, it’s a manifestation of weaker economic growth

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PESO EXCHANGE RATES n US 47.8570 n JAPAN 0.4029 n UK 68.2728 n HK 6.1447 n CHINA 7.2747 n SINGAPORE 33.4781 n AUSTRALIA 33.5909 n EU 51.7047 n SAUDI ARABIA 12.7578 Source: BSP (25 January 2016 )

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Megaworld rental income seen rising 20% this year

GOKONGWEI: “We always had a good

balance sheet.

Now is the opportunity

to strengthen it further.”

INSIDE

ART D4

ABS-CBN SNAGS PRIME-TIME SPOT

A BRONCOS WIN

TALES FROM SERGIO BUMATAY III

Cheap fuel means 1M more pax for Cebu Air in 2016

ADB fund seen to boostrollout of PPP projects

SHOW D3

SportsSportsBusinessMirrorSports C1 | TUESDAY, JANUARY 26, 2016ANUARY 26, 2016ANUARY

[email protected]@businessmirror.com.phEditor: Jun LomibaoAsst. Editor: Joel Orellana

TIGHT FINISH IN DUBAIBU DHABI, United Arab Emirates—Rickie Fowler puffed his cheeks and shook his head. What looked like being

a procession to the Abu Dhabi Championship title ended up being a squeeze for the American on Sunday.

It needed two moments of inspiration in the final round to seal a one-shot victory—

and spark more talk about Fowler’s place in golf ’s current elite. Dressed in his trademark Sunday orange, Fowler rebounded from a double-bogey at No. 7, which helped trim his lead over a congested pack of challengers from four strokes to

one, by chipping in from 30 yards for eagle from a bunker at No. 8. Then, at No. 17, Fowler holed a chip from just off the green for a birdie that

shook off playing partner Thomas Pieters, the Belgian who emerged from the bunch to

chase Fowler all the way down the stretch.“It was not how it was planned,” a

smiling Fowler said of the tight finish, “but

Henrik Stenson (67) tied for third.There was satisfaction for Fowler with

claiming his fourth win worldwide in nine months, after victories at The Players Championship, the Scottish Open, and the Deutsche Bank Championship in 2015. This win will move him from No. 6 to No. 4 in the rankings, for a first-ever spot in the world’s top five.

The so-called “Big Three” of Jordan Spieth, Jason Day and McIlroy may need to be enlarged.

“I want to be part of the crew. It would be a pretty good foursome,” Fowler said. “I think I mentioned through the summer at some point, I said I was a sneaky fourth. We’ve got to take care of a major and then maybe I can join the crew.”

The win was extra special for Fowler, considering Spieth (No. 1), McIlroy (No. 3) and Stenson (No. 5) were in the field—arguably the strongest the European Tour will have this year.

Spieth tied for fifth—five shots behind Fowler—after a 68 and acknowledged after his final round that he was “beat up, mentally and physically,” having played in South Korea, China, Australia, Bahamas, Hawaii and now Abu Dhabi

the par-5 18th and found a greenside bunker with his approach. Pieters gave himself a putt for eagle, which he missed left by an inch.

Fowler had two putts to win and he needed them both, with his winning effort from 2 feet.

“I didn’t do much wrong today,” said the big-hitting Pieters, who moved to within one shot of Fowler with a birdie on No. 13 but only parred his way to the 18th. “Next time maybe some more putts drop, that’s it.”

This is the first time Fowler has won during the first four months of a year. He has made a fashion statement this week by wearing high-top golf shoes and ankle-tight jogger pants, but he’s sent out a golfing message, too.

“Nice to have the game where it’s at right now going into the season, instead of trying to work on things,” he said. “I’d say this is really the first time in my career I’ve had that.”

It was another near miss for McIlroy, who adds a third place to his four runner-up finishes in Abu Dhabi at what is always his first event of each year. AP

A BRONCOS WINA BRONCOS WIN

TIGHT FINISH IN DUBAIBU DHABI, United Arab Emirates—Rickie Fowler puffed his cheeks and shook his head. What looked like being



and spark more talk about Fowler’s place in golf ’s current elite. Dressed in his trademark Sunday orange, Fowler rebounded from a double-bogey at No. 7, which helped trim his lead over a congested pack of challengers from four strokes to





TIGHT FINISH IN DUBAIA BU DHABI, United Arab Emirates—

Rickie Fowler puffed his cheeks and shook his head. What looked like being



and spark more talk about Fowler’s place in golf ’s current elite. Dressed in his trademark Sunday orange, Fowler rebounded from a double-bogey at No. 7, which helped





The two-time Australian Open

champion Victoria Azarenka had just beaten Barbaro Strycova,

6-2, 6-4, in the fourth round on Monday—continuing a three-

year sequence of wins against the Czech player that started in the second round in 2014 in the second round in 2014

and included the third round last year—when she wanted

to know the result of the American Football Conference

title game.

B J PB J P�e Associated Press�e Associated Press

MELBOURNE, Australia—Victoria ELBOURNE, Australia—Victoria Azarenka couldn’t get off court Azarenka couldn’t get off court quickly enough to check the score quickly enough to check the score after reaching the Australian after reaching the Australian Open quarterfinals.Open quarterfinals.

To her elation, it was a Broncos win. To her elation, it was a Broncos win. The two-time Australian Open champion The two-time Australian Open champion had just beaten Barbaro Strycova, 6-2, 6-4, in had just beaten Barbaro Strycova, 6-2, 6-4, in the fourth round on Monday—continuing a the fourth round on Monday—continuing a three-year sequence of wins against the Czech three-year sequence of wins against the Czech player that started in the second round in 2014 player that started in the second round in 2014 and included the third round last year—when and included the third round last year—when she wanted to know the result of the American she wanted to know the result of the American Football Conference title game.Football Conference title game.Football Conference title game.

“Can somebody please tell me, did Broncos “Can somebody please tell me, did Broncos “Can somebody please tell me, did Broncos win?” she said, taking over her on-court TV win?” she said, taking over her on-court TV win?” she said, taking over her on-court TV interview. When she heard the Denver Broncos interview. When she heard the Denver Broncos interview. When she heard the Denver Broncos had beaten the New England Patriots, 20-18, she had beaten the New England Patriots, 20-18, she had beaten the New England Patriots, 20-18, she shouted “Yesss!!”—stepping back and raising shouted “Yesss!!”—stepping back and raising shouted “Yesss!!”—stepping back and raising both arms, “I’m so happy now.”both arms, “I’m so happy now.”both arms, “I’m so happy now.”

“I was so nervous the whole morning, I didn’t “I was so nervous the whole morning, I didn’t “I was so nervous the whole morning, I didn’t watch. I didn’t want to know the result,” she said. watch. I didn’t want to know the result,” she said. watch. I didn’t want to know the result,” she said. “As you can see I’m a crazy sports fanatic, so I “As you can see I’m a crazy sports fanatic, so I “As you can see I’m a crazy sports fanatic, so I understand you guys when you get all nervous understand you guys when you get all nervous understand you guys when you get all nervous and stuff, because I felt that.”and stuff, because I felt that.”and stuff, because I felt that.”

Peyton Manning’s Broncos will face Cam Peyton Manning’s Broncos will face Cam Peyton Manning’s Broncos will face Cam Newton’s Carolina Panthers in the 50th Super Newton’s Carolina Panthers in the 50th Super Newton’s Carolina Panthers in the 50th Super Bowl. Azarenka has already shown some Bowl. Azarenka has already shown some Bowl. Azarenka has already shown some allegiance to Newton and the Panthers, doing her allegiance to Newton and the Panthers, doing her allegiance to Newton and the Panthers, doing her version of the “dab” in her victory celebrations.version of the “dab” in her victory celebrations.version of the “dab” in her victory celebrations.

Told the Panthers were well ahead of the Cardinals in the National Football Conference decider, Azarenka said, “Well then, it’s going to be my dream final, I can’t wait to see that.”

Azarenka is coming off two injury-interrupted seasons, but is returning to the kind of form that took her to the No. 1-ranked and back-to-back Australian Open titles in 2012 and 2013.

She won the Brisbane International leading into the first major of the season and dropped only five games in her first three rounds at Melbourne Park. Strycova, who beat third-ranked Garbine Muguruza in the third round, took six games off Azarenka.

“She’s such a tough opponent. I’m just so happy I went through,” she said. “I played smart, I played aggressive, I took my opportunities and I really kept my composure.”

Next up she faces No. 7 Angelique Kerber, who beat fellow German Annika Beck, 6-4, 6-0, in the preceding match on Rod Laver Arena.

Kerber, who saved a match point in her first-round win over Misaki Doi, is into the quarterfinals for the first time in Australia.

“Maybe it’s a good omen. But, yeah, I was in the first match, match-point down. I was with one foot in the plane back to Germany,” she said.

Gael Monfils had a 7-5, 3-6, 6-3, 7-6 (4) win over Andrei Kuznetsov to reach the quarterfinals for the first time in 11 trips to Melbourne Park, thrilling the Margaret Court Arena crowd with his acrobatic tumbles and dives.

He will play the winner of the later match

between fourth-seeded Stan Wawrinka, the French Open and 2014 Australian Open champion, and No. 13 Milos Raonic.

In the night match, No. 2 Andy Murray, a four-time finalist at Melbourne Park, was set to face No. 16 Bernard Tomic.

Novak Djokovic, meanwhile, was looking everywhere for answers, even in the crowd.

The top player in tennis, who won 27 of a possible 28 matches in Grand Slam matches in 2015, had the number 100 in the unforced errors column after his 6-3, 6-7 (1), 6-4, 4-6, 6-3 win over Gilles Simon late on Sunday.

The win secured his spot in the quarterfinals for the 27th consecutive major, equaling Jimmy Connors at No. 2 in that streak and trailing only Roger Federer’s record of 36.

Yet Djokovic still thought it was a forgettable day. He was dissecting the match in an on-court interview on Sunday when a burst of laughter from the crowd caught his attention.

“Sorry, everybody is laughing. I just want to hear, what did you say?” Djokovic said, looking into the stands. The answer came back loud and clear: “No more drop shots.”

“OK, thanks buddy,” Djokovic deadpanned. “I hate to say, but you are absolutely right.”

A handful of ill-advised and poorly executed backhand drop shots by Djokovic made up the most glaring of his unforced errors.

“I don’t think I’ve had any number close to 100,” he said. “In terms of the level that I’ve played, it’s the match to forget for me.”

AN in-form Victoria Azarenka (below) breezes into the Australian Open quarterfinals at the expenseof Barbaro Strycova. AP

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PHILIPPINE TELCO GIANTS LAG BEHIND PEERS IN ASIA PACIFIC

PROPERTY developer Megaworld Corp. expects rental income to grow 20 percent by the end of

the year to about P11 billion with the completion of more office towers, malls and commercial centers. The projection placed the company’s leasing income this year at P9.16 bil-lion, which is 29 percent higher than the P7.07 billion it achieved in 2014. The company’s rental income comes mostly from office and mall revenues. It will, however, start its hotel opera-tions by the middle of this year with the opening of Belmont Hotel in Re-sorts World Manila in Pasay City. Hotel revenues will form part of the com-pany’s recurring income. “We are on track in strengthening our office and mall portfolios, as we continue to experience robust demand for spaces, both office and retail, in our townships. Both our offices and retail

PIA’S MOMENT Miss Universe Pia Alonzo Wurtzbach waves to well-wishers taking photos with their mobile phones during her welcome parade on Monday. The country’s third Miss Universe arrived home on January 23. ALYSA SALEN

B C U. O

THE Philippine government now has an additional source of funds to jump-start or fast-track

the implementation of public-private partnership (PPP) projects with the launch of a regional multidonor trust fund, dubbed as the Asia-Pacific Project Preparation Facility (AP3F), on Monday.

$73 million

The $73-million AP3F, to be managed by Manila-based Asian Development Bank (ADB), covers project structuring, capacity-building and creation of PPP policy

ADB fund to jump-start PPP projects in Asia Pacific

spaces enjoy a very high occupancy rate of around 99 percent across our developments,” Jericho Go, the com-pany’s senior vice president, said ina statement.

At least 10 office towers in Uptown Bonifacio, McKinley West, The Mac-tan Newtown and Iloilo Business Park will be completed by year-end. These new office towers will bring in a gross floor area of 287,500 square meters.

The company by year-end will have a total gross floor area of more than

650,000 sq m.Currently, the firm has more than

150 companies in its portfolio of office tenants, mostly from the information technology and business-process out-sourcing (BPO) sector, such as Accen-ture, Wells Fargo, HP, IBM and United Health Group. Around 11 malls and commer-cial centers, on the other hand, will be completed in McKinley Hill, Uptown Bonifacio, McKinley West, The Mactan Newtown, Iloilo

Business Park, ArcoVia City, South-woods City and Makati by year-end. These new developments will have a gross f loor area of around 371,000 sq m.

“Our malls and commercial cen-ters primarily cater to our growing residents and BPO workers in our townships. Megaworld offers a ready market to our r wetail partners. In McKinley Hill, for example, where we have around 80,000 BPO workers and 12,000 residents. They are the

primary customers of Venice Piazza, Tuscany and the upcoming Venice Grand Canal Mall,” Go said.

For the three quarters of 2015, Megaworld’s rental income rose 24 percent to P6.44 billion, from the previous year’s P5.19 billion.

The company’s net income dropped to P8.35 billion for the nine months of 2015 ending September, or less than half of the previous year’s P19.03 billion income, which included huge one-time gains. VG Cabuag

that, while the Philippines might have improved its connection by a percentage point, its overall ranking in Asia still remains at No. 13 out of 15, or the third-worst connection in the region.

National Telecommunications Commission (NTC) Deputy Com-missioner Edgardo V. Cabarios said this hinders the Philippines from realizing the true potential that the digital economy has to offer, underscoring the importance of new technologies in driving growth to a country’s GDP.

There is a direct correlation between broadband access and the growth of a country’s local output, he said.

For every 10-percent increase in broadband penetration, the economy grows by 1.23 percent. Doubling the speed of the connection also results in a 0.3-percent rise in the GDP.

“The industry has a huge poten-tial of contributing largely to eco-nomic growth. Hence, the need for adequate infrastructure in telecom-munications,” he said. “The digital economy is happening all over the world, and the Internet will help our entrepreneurs be more competitive in a global landscape.”

With trade agreements already in place, Cabarios said the Philip-pines must be prepared to develop the broadband sector.

National Economic and Develop-ment Authority Director General Arsenio M. Baliscan agreed, saying that there is a need for the Philippines to play “catch-up” with its neighbors.

“For our economy to sustain its rapid growth of 6 percent to 7 percent in the coming two to three decades, the period when we need to catch up with our neighbors, we would need to invest aggressively and massively in infrastructure, and ICT [information and communications technology] is one of them,” he said.

The government has poured in

roughly P5 billion to develop the ICT sector in the past two years. The year 2015 saw the govern-ment spending about P3.18 billion to develop the sector, roughly 81 percent of the P1.76-billion budget in 2014.

The state has earmarked more than P4 billion, with the aim of further driving growth in this sec-tor this year. Note that not all of it will be used to enhance broadband access in the country.

Such a budget also is not enough.

‘Completing digital strategy impossible this year’ THE telecommunications industry in the Philippines is largely depen-dent on private investments. Over the past decade, the two largest players in the country—the Philip-pine Long Distance Telephone Co. (PLDT) and Globe Telecom Inc.— have jointly invested roughly P700 billion to grow their businesses.

Credit watcher Fitch Ratings has predicted that the industry will in-vest P85 billion this year to aggres-sively roll out high-speed mobile and fixed-line broadband networks to offer better services.

Globe Spokesman Yolanda C. Crisanto said her company will be spending about $800 million in capital expenditure this year.

“The bulk of this will be devoted mostly in enhancing bandwidth capacity to enable us to stay ahead of the curve amid growing prolif-eration of smartphone and data-intensive multimedia applications,” she said. Its rival, the largest Filipino tel-co today, will likely keep its capital requirements elevated this year, despite hitting record highs in 2015 at around P43 billion.

“We have not issued a formal guidance yet on our capital for 2016, but indications are that this year’s capital expenditures will be at lev-els similar to those of 2015,” PLDT

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PHL telco giants lag behind peers in Asia Pacific

Spokesman Ramon R. Isberto said. But for Cabarios, the correct ap-

proach to developing the market is for the government to jointly invest in the said endeavor.

“It should be a multistakeholder approach. We can’t rely on private investments, and we can’t rely on government spending. We have to do it together,” he said. At the onset of the Aquino ad-ministration, the government crafted the Philippine Digital Strat-egy, a five-year plan that spelled out the requirements and targets of the country toward the adoption of new technologies to be more competitive in global trade and promote inclu-sive growth.

Under this document, the govern-ment aims to provide 80 percent of the population with Internet access with at least 2 Mbps of speed; reduce the prices of broadband Internet by at least 5 percent annually; and increase the development of infra-structure by 10 percent every year through 2016.

The plan also aims to curb the digital divide, which is a roadblock to economic development and social inclusion since a large number of in-dividuals are still unable to access high-speed Internet. Unfortunately, most of these have yet to be realized. “The Philippine Digital Strat-egy is still there, but given that it is already 2016 and we are still far from achieving our goals, maybe we will have to move the time frame to achieve the goals of the plan. Right now, it is impossible to achieve them,” Cabarios said. Hence, the full realization of the plan will be largely dependent on the willingness of the next administra-tion to implement it. “We will have to move the time frame to another five years—maybe, it will be attainable by that time, espe-cially that the plan has been further polished,” he added, citing the recent efforts of the government to provide free wireless access in public places. The problem with the plan is also largely caused by the lack of govern-ment investments in the broadband sector. Currently, the government has no specific funding tool for tel-co-related investments, aside from the ones allocated to the Depart-ment of Science and Technology. “We need a universal access fund to finance investments in the digital space. We had hoped that this Con-gress could pass this law, but with only a few sessions left, it might be too hard for them to do it,” Cabarios said. “So maybe by the next Congress, we will have this funding mechanism for broadband development.”

Need for detailed broadband planTHE Philippines is one of the few countries in the region where the government has yet to fully engage in investing in telco infrastructure. Neighboring countries in the Asean have already started to implement

national broadband plans, earmark-ing billions of dollars to develop a government-owned backbone for the information superhighway. In Thailand, for example, the government has invested $114 mil-lion to improve the Internet service or availability. The fund is part of Bangkok’s economic policy. The Vietnamese government owns two of the three largest tele-communications companies in Ho Chi Minh City. Investments mainly come from the government. Malaysia has now spent a total of $4.5 billion over a 10-year period to lay fiber-optic lines to every home in the country’s urban area. Other developing and developed economies are investing billions of dollars to improve Internet access in their countries. Cabarios said the Philippines has to craft a clear-cut National Broadband Plan to provide a clear direction for the government to ensure that all Filipinos will reap the benefits of broadband, address challenges and accelerate broad-band deployment. A National Broadband Plan will provide detailed physical targets and strategies to effect nation-wide broadband deployment and widespread use. Such a plan would analyze existing and planned gov-ernment and private-sector deploy-ment, and address supply and de-mand gaps by recommending policy and nonpolicy related actions. “The plan should be ready by June so that the incoming administra-tion can implement the National Broadband Plan. We have to have one for medium term, which is for the next five years, and for the long term, which is for the next 10 years or so,” Cabrios said.

Government intervention WHAT the government has do is to pinpoint the areas on which it should pour in money, the sphere on which it will help the private sector,

and the fields that are better left with private investments. “The problem with the Philip-pines is that broadband growth is largely concentrated on larger areas where competition will survive— mainly the cities. What happens to the others? They are left without Internet access. As the government, we have to do this,” he said. He cited, for example, countries like the US and New Zealand, where the government intervenes in de-veloping telecommunications infra-structure in so-called missionary ar-eas, provinces which are considered markets with very low demand. “The strategy of the United States is this: Where competition thrives, the telcos are left alone. For areas without connection, the govern-ment encourages the providers. But if there really is no appetite for a market, the government has to intervene,” Cabarios said. He added: “Similar to that, we have to identify where the govern-ment should invest, where the gov-ernment has to subsidize and where the government will leave the mar-ket to the private sector.” “The government of New Zealand even created a funding company for four to five telcos owned by the gov-ernment to develop the infrastruc-ture. The principle is this: For as long as there is no telco service in a certain area, the government will operate, until companies are willing to buy in.” In the case of the Philippines, these areas may be found in the mountains, far-flung provinces and war-torn zones. This is where the universal access fund will be critical. “It is crucial because it will pro-vide funding for the development of infrastructure in missionary areas. It’s a big requirement. But you can-not do it overnight. The fund will increase every year, hopefully. You keep on increasing the penetration and move further until every and all villages are connected,” he said.

To be concluded

globally, especially with concerns about China’s weakening econo-my. There are also currency fears in emerging markets.”

Daniel Lau and Edward Xu, an-alysts at Morgan Stanley, said 2016 could be a better year for carriers in the Asean.

“We think that Asean air-lines are likely to enjoy margin expansion, albeit on varying levels, as we do expect lower fuel prices to drive price com-petition, as rivals pass on fuel cost savings to passengers,” the analysts wrote in a report dated January 24. “We are raising our estimates for Asean airlines across the board as we adjust for lower fuel prices, offset by lower pax yield.”

Morgan Stanley is cutting yield growth expectations for low-cost carriers in Asean, given that the airlines will take the opportunity to pass on some fuel cost savings to passengers or reduce fare growth to entice air travel, it said in the report, which doesn’t men-tion Cebu Air specifically.

Cebu Air, which was unprof-itable in the third quarter of 2015 due to fuel hedging and currency losses, is reviewing its fuel-purchase strategy and will consider adding more hedges to take advantage of the current low fuel price, Gokongwei said. Whether it can expand its fleet will depend on demand and the airline’s ability to add new des-tinations, he said.

Jet fuel bought at an average of $75 a barrel will account for about 25 percent of Cebu Air’s fuel needs this year and 18 percent in 2017, Gokongwei said. That’s an improvement from 2015, when it paid more than $100 a barrel for

30 percent of its fuel needs.

Two to contango“THE market is in severe con-tango and that’s something we have to consider,” he said, refer-ring to a situation where the spot price of fuel is lower than the forward price. “If I fix the price for 2017, am I going to pay $10 more to hedge compared to the spot price?”

Spot prices of jet fuel cargoes loaded from Singapore fell to $37.66 a barrel on January 21, their lowest since Bloomberg be-gan compiling the data in 2011. Cebu Air, which will sell four jets this year and receive five new ones, doesn’t plan to increase its long-haul f leet for now, Gokongwei said.

Slowing global growth, mar-ket turmoil and weakening cur-rencies, including the Philippine peso, are risks for Cebu Air, Go-kongwei said. The airline gener-ates revenue in pesos, but about 75 percent of its costs—and almost all its debt—are in US dollars.

Mideast concernsOXFORD Economics in Decem-ber 2014 named the Philippines, which imports almost all the oil it needs, as the economy set to gain the most if crude fell to $40 a barrel. With fuel now at $30, though, pain among Middle East oil producers could hit the Philippines, which sends about 2.5 million citizens to the region for work. “We haven’t seen any weakness yet, but we have to an-ticipate a potential slowdown in demand for travel and overseas-worker traffic to the Middle East,” which is a big market for Cebu Air, Gokongwei said. Bloomberg News

176th Philippine ranking out of 202 nations worldwide in global average broadband-download speed of 23.3 Mbps

₧5BAmount the government has poured in the past two years to develop the information and communications technology sector

and framework, as well as monitoring and restructuring of individual deals.

“Through this facility, we are further assisting the public sector to structure PPP green field projects to make them viable and bankable. Uniquely, this facility also supports ongoing brown field projects where public sector needs to monitor their progress, and to restructure them if the projects are not on the track as initially planned,” ADB Office of Public-Private Partnership Head Ryuichi Kaga told the B-M in an e-mail. The ADB facility is similar to the Philippines’s own Project Develop-ment Monitoring Facility (PDMF).

For her part, PPP Center Execu-tive Director Cosette Canilao told the BM that the launch of the AP3F also means additional financial resources for the govern-ment’s line agencies, particularly in PPP preparation.

“It will increase the avenues by which implementing agencies or the government can get help in terms of project preparation,” Canilao said. Canilao added that project-prepa-ration financing for PPPs can be ob-tained from various sources, such as the national budget, the PDMF and multilateral and bilateral agencies.

She said the departments of Public Works and Highways and Transportation and Communica-tions have recently obtained fund-ing from the International Finance Corp. and the US Agency for In-ternational Development for the project-preparation needs of some of their PPPs. Having additional sources of funds for preparing PPP projects would help jump-start key infra-structure projects as both the PDMF and the budget of line agencies are limited. The PDMF is a revolving fund that helps in financing feasibil-ity studies and other studies needed

in project preparation. In a statement, the ADB said the AP3F is a multi-donor trust fund that seeks to help developing Asia and the Pacific prepare, structure and place bankable PPP projects in the market. The facility is funded by com-mitments from the governments of Japan, Canada and Australia to con-tribute $40 million, CA$20 million and AU$10 million respectively.

ADB added that it will also con-tribute $10 million to the facility. The Manila-based lender said more donors are expected to contribute to the fund. The facility’s primary objective is project-preparation support for gov-ernments, including due diligence and advisory work covering technical, financial, legal and regulatory issues, as well as safeguards. It can also provide capacity and policy-development support and project-operation support, including monitoring and restructuring work

for existing projects. “AP3F exemplifies ADB’s broader role as a development partner to governments that goes beyond the financing of Asia’s infrastructure,” the ADB said.

The new facility will prioritize PPP i n f r a st r uc t u re pro je c t s with regional cooperation, sus-tainable development and climate-change elements. The ADB’s efforts parallel those of the Group of Twenty (G20) na-tions and the Asia-Pacific Economic Cooperation (Apec) forum, which both stress the importance of at-tracting private-sector participa-tion in infrastructure as a means to promote growth, expand trade and improve livelihoods.

In 2014 the G20’s finance min-isters endorsed the Global Infra-structure Initiative which is aimed at increasing long-term private in-vestment in infrastructure. AP3F is also part of Apec’s 2015 Cebu Action Plan.

ADB fund seen to boost rollout of PPP projects

Megaworld rental income seen rising 20% this year… C

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THE Manila North Harbor, like other ports in the country, usually experiences congestion due to the inability of the government to modernize the sea gateways. ALYSA SALEN

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[email protected] Tuesday, January 26, 2016

B C N. P

THE British Chamber of Com-merce Philippines (BCCP) on Monday expressed con� dence

that it could attract more British small and medium enterprises (SMEs) to the Philippines, especially in food, bev-erage and retail businesses.

Chris Nelson, BCCP chairman, painted a rosy outlook for Philip-pine-British trade in the incoming year, citing what he described as the sustained interest of Britain-based SMEs in the country.

“� e key for British companies is that they see the opportunities here; and they’ve seen their col-leagues seize the opportunity. � e focus now will be on what [had] happened [in the past year]. I think the retail sector, especially those in food and beverage, have done well,” Nelson said during a luncheon con-ference with reporters.

Interest in trade in goods and ser-vices remain high, given the success of the UK retail chains, such as Waitrose and Costa Co� ee, Nelson added.

� e two British brands have already closed distribution agree-ments with local companies to es-tablish presence in the Philippines last year.

Other areas of interest to British SMEs are in software, engineering services and pharmaceuticals.

“What we want to do is more sector-speci� c in our promotions. � ere’s a really wide interest level in sectors in [the Philippine] market,” Nelson added.

� e BCCP, through its Busi-ness Support Service (BSS), has already assisted 20 British com-panies to find local partners since the year began, with most of the � rms engaged in the distribution of pharmaceutical products. Some of these � rms are Bruntys Cider, Allied Pharmaceuticals and Rose-mont Pharmaceuticals.

Since the BSS started in 2014, the BCCP has fa-cilitated the entry of some 700 British companies in the local market.

For outbound promo-tion, Nelson said he is poised to make a pitch to UK � rms at the British Chamber of Singapore’s Trade Mission event in the city-state in February.

A major event in the pipeline is a joint promo-tion e� ort with the UK Trade and Investment Of-� ce in June this year, and to host British companies in the sectors of power and renewable energy.

According to the BCCP, UK exports to the Philip-

pines grew by 44 percent in the � rst half of 2015.

Based on data from the Depart-ment of Trade and Industry, total trade between the Philippines and Great Britain (the UK and North Ire-land) has amounted to $586 million from January to August 2015.

Bilateral trade has averaged around $1.8 billion annually, the BCCP said.

BCCP’S NELSON PAINTS ROSY OUTLOOK FOR PHILIPPINES–BRITAIN SME TRADE

Consolidated CMTA up for ratifi cation

� e key for British companies is that they see the opportunities

here; and they’ve seen their colleagues seize the opportunity.”—Nelson

B C U. O

THE Philippine government is scal-ing up its initiatives to make the country more resilient to the ef-

fects of climate change, speci� cally in areas near “critical watersheds.”

This was con� rmed to the BUSINESSMIR-ROR by Asian Development Bank South-east Asia Department principal climate-change specialist Ancha Srinivasan in an interview at the sidelines of the Work-shop on Urban Resilience to Climate Change and Green Growth in Critical Wa-tersheds of the Philippines on Monday.

“I was just talking to Secretary [Em-manuel] de Guzman [of the Climate Change Commission]. He wants to scale up [the project] because he just visited our work in Davao Oriental and he was impressed with the type of capacity-building activity going on in LGUs [local government units]” Srinivasan said.

The ADB and the Japan Fund for Poverty Reduction (JFPR) extended $2.5 million in grants to � nance the Demon-strating Ecotown Framework in the Up-

per Marikina River Basin and Protected Landscape (UMRBPL) and the Climate Resilience and Green Growth in Critical Watersheds projects, respectively.

But Srinivasan said the two projects were only able to cover 14 LGUs in three watersheds. Scaling this up means cov-ering 11 or 12 more LGUs with baran-gays in the area of critical watersheds.

If the government intends to further expand this project to include LGUs in the other 15 critical watersheds, this will require a signi� cant amount of fund-ing. These watersheds include Magat, Abulog-Apayao, Angat, Pantabangan, Ja-lauar, Maasin, Salug, Muleta-Manupali, An-danan, Allah and Buluan-Alip. This fund-ing, Srinivasan said, could be obtained through loans—not grants—from the ADB or other sources since the country, being a middle-income country, can af-ford to pay them.

“If the government considers that this is in the long-term interest of the people and the community, in terms of protecting their investments from future impacts of climate change, it could be [a] loan,” Srini-

vasan said. “[But] we believe it will be a blend of grant and loan investments if we really want to scale up [the project].”

The ADB-funded project aimed to create a “green growth road map” for the UMRBLP and prepare an inventory of greenhouse-gas (GHG) emissions, as well as assess the vulnerability to cli-mate change of ecosystem services.

The project also aimed to identify priority interventions to respond to the impacts of climate change and trigger green growth; develop local climate-change action plans that can be inte-grated into comprehensive develop-ment plans of the concerned LGUs; and pilot select adaptation and green-growth measures.

The JFPR-funded project, on the oth-er hand, sought to demonstrate climate-resilient green-growth options in critical watersheds in the lower Marikina River basin, Camarines Sur and Davao Oriental.

The project also aimed to strengthen the capacity of LGUs to mainstream cli-mate-change concerns into development planning.

PHL urban-resilience project to cover more LGUs near ‘critical watersheds’

“It will be submitted for � nal rati� cation [by the Senate and the House] on Wednesday,” said Sen. Juan Edgardo Angara, chairman of the Sen-ate Committee on Ways and Means and chief sponsor of Senate Bill 2968, embodying the proposed Customs Modernization and Tari� Act (CMTA).

In a brief interview, Angara dis-closed on Monday that the consoli-dated CMTA bill is now being circu-lated for signatures by members of the bicameral panel that met for two days to reconcile con� icting provisions on the Senate and House versions of the measure.

Angara admitted that the timely approval of the CMTA bill before the current Congress � nally adjourns ses-sions next week was being “pushed heavily” by the Department of Finance

B B F

CONGRESS—doing its best to meet a self-imposed deadline—is set to ratify

this week the fi nal version of a reconciled bill updating the Tariff and Customs Code of the Philippines (TCCP), a long-awaited move “modernizing” customs procedures to facilitate trade and increase revenue collections.

and the Bureau of Customs (BOC), as well as the Palace.

Angara acknowledged the stepped-up Palace lobbying e� orts to get the bill enacted into law soonest “kasi po-pogi ang Pilipinas sa business-community worldwide.”

“We will look good with the inter-national community as a business-friendly destination,” Angara told the BusinessMirror.

� e soon-to-be-enacted law amends the existing TCCP to fully comply with the Revised Kyoto Convention (RKC), considered a blue-print for “modern and e� cient cus-toms procedures” of the World Cus-toms Organization.

According to Angara, the proposed CMTA is not seen to result in any revenue loss to the government, cit-ing projections that its early imple-mentation would even lead to an estimated 10-percent increase in cus-toms collections.

He explained that the CMTA was crafted to “simplify, modernize and

align the country’s customs proce-dures with global best practices” by introducing amendments to the TCCP.

In crafting the CMTA, Angara con-� rmed that lawmakers also wanted to overhaul and modernize the BOC, “long been perceived as one of the most corrupt and underperforming government agencies in the country.”

� e senator noted that “approxi-mately $277 billion in revenues was lost by the government from 1960 to 2011 due to technical smuggling, ac-cording to a 2014 study of Global Fi-nancial Integrity.”

Angara added that the CMTA was also crafted to increase transparency and simplify procedures in the BOC, increase the de minimis value, raise the tax-exemption ceiling for pack-ages sent by balikbayan and returning residents, and provide harsher penal-ties for smuggling. He explained that de minimis covers small items that are usually minor or lacking importance.

� e senator said the CMTA also c arries a provision raising the tax-ex-empt value of balikbayan boxes from P10,000 to P150,000, and the de minimis value from P10 to P10,000. “Tax-exempt and de minimis values may also change every three years. Donation and relief goods will also be duty- and tax-free during times of calamity,” he added.

Angara asserted that the bill also “clearly de� nes the exercise of customs police authority, customs ju-risdiction and customs control.”

� e senator recalled that during the public hearings on the measure, BOC of-� cials told lawmakers they anticipate a 10-percent increase in revenue col-lection once the bill is enacted into law, with the BOC pegging revenue collection at P369 billion in 2014. In a separate statement, Senate President Franklin Drilon acknowledged that upgrading the current customs sys-tems to electronic processing would make the BOC’s importation and ex-portation procedures faster, more ef-fective and more convenient, espe-cially for the public.

Drilon said the modernization envisioned under the CMTA will “bene� t millions of ordinary Filipinos who su� er from the ine� ciencies in the handling of incoming and outgo-ing goods, especially during holiday seasons, when Filipinos endure the cumbersome process of trying to

claim gifts or packages which are stuck at the ports.” He notes that the CMTA also envisions the use of information and communications technology and other appropriate applications to “re-inforce the BOC’s functions toward simpli� ed, secured and harmonized trade facilitation.”

Foreign businessmen have been urging the 16th Congress to ensure the approval of the CMTA, aside from ensuring the transparency of transac-tions at the BOC. European Chamber of Commerce of the Philippines President Guenter Taus said having the CMTA in place will allow the Philippines to be compliant with international trade commitments and regulations.

“[CMTA] will accelerate the au-tomation of customs procedures and the full implementation of the National Single Window, thus, pre-paring the Philippines for the Asean Single Window,” Taus told the Busi-nessMirror.

“At the policy level, [CMTA] will align customs procedures to the Philippines’s commitments under the Revised Kyoto Protocol of the World Customs Organization and the Trade Facilitation Agreement of the World Trade Organization, with the condition that provisions on Pre-Shipment Inspection are not included,” he added.

Taus said the passage of the pro-posed CMTA would send a signal to the European Union (EU) that the Philippines is “serious” about strengthening its economic ties with the 28-member bloc and in pursuing a free-trade agreement with the EU.

“� e enactment of CMTA will signi� cantly improve market access to the Philippines and the ease of exporting Philippine products. It is an important measure to strengthen the competitiveness of the country vis-à-vis other Asean member-states and the wider global market.”

Customs revenue leakage from 1960 to 2011 that Congress hopes to plug through the CMTA

$227B

THE Pangtabangan Dam is one of the 15 critical watersheds identi� ed by the government. NONIE REYES

Where’s the money?

Malacañang must tell the families of the slain SAF commandos how the reward money was shared.”–Duterte

BusinessMirror www.businessmirror.com.ph Tuesday, January 26, 2016A4

BMReports

Aquino said that he himself is frustrated by the pace of how gov-ernment authorities are building up a case to prosecute the perpe-trators of the massacre of the 44 SAF commandos in the botched Mamasapano operation.

Malacañang said that the impromptu meeting started at around 11 a.m. after the commemo-ration ceremonies in Camp Crame on Monday for the first anniver-sary of the deaths of the 44 SAF members, and is the third meeting between Aquino and the surviving families of the SAF 44 members, the first two being in January and February 2015.

However, contrary to his earlier pronouncement that he takes the blame as commander in chief for the deaths of the 44 SAF members, Aquino appeared to pass the buck to a “breach of procedure” commit-ted by police officers in charge of the operation.

“You can count on this, that along with the giving of support for the families of the SAF 44, the gov-ernment is striving hard to achieve justice. Our call on Congress is this: let us examine the National Police law and determine the provisions that hinder the immediate render-ing of punishment for officials who are remiss in their duties. We do not want a tragedy to happen again just because of a breach in protocols,” Aquino said in his speech at the first year commemoration ceremonies at Camp Crame.

He was apparently referring to the National Police Board of Inquiry (BOI) report on the Mamasapano operation, and how it went awry.

Former SAF Chief Director Getu-

lio P. Napeñas Jr., now a senatorial candidate under the opposition party of Vice President Jejomar C. Binay, was blamed by the BOI as having breached certain police and military operation protocols in the planning and actual execution of the Mamasapano operation to cap-ture international terrorist Zulkifli bin Hir, alias Marwan.

The said report also tried to absolve Aquino from liability for not deploying the reinforcements, pointing instead to Napeñas as the brainchild of the “time-on-target” strategy to keep the operation as a secret until the actual target had already been engaged by the police on the ground because he believed that intermarriages between mili-tary personnel and the local people in Mamasapano could compromise the operation and endanger the lives of those who would actually carry it out.

Where’s the reward money?DAVAO CITY—Mayor Rodrigo R. Duterte on Monday urged opera-tors of the Mamasapano, Maguin-danao, raid last year “to disclose who claimed the $5 million reward offered for the capture of Marwan and how it was divided.”

Duterte issued the challenge in a meeting on Sunday in Zamboanga City with the wives of two of the 44 police commandos, who were killed in the raid, as he disclosed that he was with Aquino and then Interior Secretary Manuel A. Roxas II in the command center at Andrews Air Base on January 25 last year, the day the Mamasapano raid was conducted.

“Where’s the money?” Duterte

said, adding that he would like his message to be relayed to the au-thorities and the operators of the raid who killed Marwan, the 44 SAF commandos. He said Malacañang must “tell the families of the slain police commandos how the reward money was shared.”

“While the families of the vic-tims in the Mamasapano massa-cre could not be eased by material things, the members of the raid-ing team must share in the reward money, because more than anybody else, they made the supreme sacri-fice,” he said

The US government offered $5 million reward for information that would lead to the capture or killing of Marwan, who was listed as one of the top international terrorists for his involvement in the deadly 2002 explosion in the Indonesian resort island of Bali that killed and wounding scores of foreign tourists, most of them Australians.

He said the reward money for operations like the Mamasapano raid to get Marwan “is supposed to be given only to the informants, but in actual practice, it is usually shared between the informant and those responsible in carrying out the operations.”

“While government operatives are not supposed to get a share of the reward money, the reality on the ground is that police operatives also get to claim part of the reward in an arrangement made among the par-ticipants of the operation,” he said.

‘Speculative’NEWLY Appointed Justice Secre-tary Emmanuel L. Caparas brand-ed “speculative” the alleged new evidence that will be presented before the Senate when it reopens its investigation on the Mamasa-pano massacre. Caparas said the justice department would have to wait for the supposed new evidence to be presented before the Senate before it can pass on its validity and decide whether it can be subject for investigation by the department.

“That is speculative. Let us wait. I don’t know what additional evidence that is. Let us just wait,” Caparas said.

Earlier, Sen. Juan Ponce Enrile vowed to show proof that Aquino

“actively and directly involved him-self in the planning and preparation of Oplan Exodus.”

Meanwhile, retired Chief Super-intendent Diosdado T. Valeroso said during a news conference that he has in his possession a digital audio recording of a conversation between a ranking government official and a lawmaker about the January 25 Mamasapano encounter last year.

The conversation, which he said took place a day or two after the Mamasapano carnage, appears to be between two persons talking about an attempt to cover up the Mamasapano incident to avoid its possible effect on the passage of the Bangsamoro basic law (BBL) in Congress.

The Mamasapano inquiry is be-ing reopened by Senate Commit-tee on Public Order and Danger-ous Drugs, chaired by Sen. Grace Poe, upon the request of Enrile.

Caparas also denied that the Department of Justice (DOJ) is delaying its resolution on the Ma-masapano case which has been sub-mitted for resolution by a panel of procecutors following preliminary investigation.

While it has been a year since the death of the SAF 44, Caparas insisted they are not sitting on the Mamasapano case and promised that a resolution will be out soon.

“You are talking about many, many witnesses, you are talking about several defendants, and when you put that all together, you sum it all up, an investigation like that can take a very long time,” Caparas pointed out.

A total of 90 respondents belong-ing to the Moro Islamic Liberation Front (MILF), its breakaway group Bangsamoro Islamic Freedom Fighters (BIFF), and local armed groups have been charged before the DOJ for the complex crime of direct assault with murder for the death of the 35 of the 44 SAF mem-bers belonging to the 55th Special Action Company (SAC).

On the other hand, the fact-finding team failed to gather evi-dence that would point to those re-sponsible for the killing of the other nine members of the 84th SAC.

State Prosecutor Alexander Su-arez, one of the members of the

five-man preliminary investigation panel earlier said only four out of the 90 respondents responded to the subpoenas they issued.

‘What cover-up?’TOP police and interior department officials denied on Monday reports about the alleged previous attempt by the government to cover up for the Mamasapano massacre.

“Cover-up, there is no cover-up,” Interior Secretary Mel Senen Sarmiento said about the reinves-tigation into the massacre of the 44 members of the SAF while on counterterrorism operations in Maguindanao a year ago.

“But I don’t want to comment on something I don’t know, but hearings have been conducted and this issue already went through the process,” he added during the 25th National Police Foundation Day anniversary celebration at Camp Rafael Crame in Quezon City. The celebration was highlighted by the awarding of medals to the slain 44 police commandos, including two Medal of Valor. The awards were received by family members of 38 of the killed policemen and class-mates of two of the slain policemen. The four others did not have any representative.

“As far as we are concerned, there was no attempt to cover up the in-vestigation. I heard during the ex-ecutive session everyone was given the chance to talk freely. Hindi ko alam kung ano pa iyong sinasabi nilang audio [recorded] conversation,” said Director General Ricardo Marquez, National Police chief.

“When we have heared that [audio recording]…that’s the time maybe that we can comment,” Mar-quez added.

Sarmiento and Marquez were reacting to reports about the re-cording that was reportedly in the possession of retired Chief Supt. Diosdado Valeroso.

Valeroso, former deputy com-mander for administration of the Metro Manila police command, claimed he received the recording through an e-mail. He said copies of the recording will be distributed on Wednesday during the Senate hearing. Earlier, Enrile said he has evidence that would point the direct

responsibility of Aquino in the kill-ing of the commandos by fighters of the MILF and the BIFF.

Marquez said he is waiting to have a copy of the supposed record-ing, which he had already asked from Valeroso, his classmate at the Philippine Military Academy, but was turned down.

“I asked him if I can be given a copy. He told me, it will be distribut-ed simultaneously,” Marquez said.

JusticeLAWMAKERS on Monday urged the national government to finally bring justice to the 44 SAF troop-ers who were brutally murdered by Moro rebel forces and lawless elements in Mamasapano, Magu-indanao.

Speaking on the first anniversary of the massacre, Speaker Feliciano Belmonte Jr. asked the government to expedite the cases against mem-bers of the MILF and the BIFF who killed the 44 SAF commandos.

“It’s time for us to move on but also time for the prosecution people to do their job thoroughly, justice must be done, but as a people, we need to move on,” Belmonte told re-porters. Dismayed by the national government’s inaction on the inci-dent, Party-list Rep. Gary Alejano of Magdalo noted the stark contrast between the hurried efforts to pass the proposed BBL while wheels of justice turn ever slowly on the Ma-masapano case.

Alejano assailed the slow investi-gation on the massacre, citing that the charges against perpetrators—who include MILF and BIFF com-manders and combatants—were supposed to be filed several months ago, but no meaningful develop-ment has taken place up to now.

“The government has not been aggressive in pursuing justice for the slain SAF troopers. It would ap-pear now that this administration has been deliberately silent and complacent in seeking justice for SAF 44. On the other hand, they are determined in pushing for the pas-sage of the BBL and rewarding the MILF in the process by serving them on a silver platter the control of the would-be Bangsamoro government,” he said. David Cagahastian, Joel San Juan, Rene Acosta and Jovee Marie N. dela Cruz

Aquino blames ‘breach of procedure’ for killing of SAF 44 in Mamasapano

PRESIDENT Aquino on Monday met with the families of the 44 members of the Special Action

Force (SAF), who died in the Mamasa-pano operation against an internation-al terrorist a year ago, and promised a speedy justice for the deaths of their loved ones.

Former President Fidel V. Ramos (from left), Interior Secretary Mel Senen S. Sarmiento, President Aquino, National Police chief Director General Ricardo Marquez and Special Action Force commander Director Moro Lazo say a short prayer for the eternal repose of the SAF commandos who perished during a botched anti-terrorist operation in Mamasapano, Maguindanao, on January 25 last year. This years National Police anniversary celebration was held on January 25 in commemoration of the �rst year of the death of the 44 commandos. The ceremonies were held at the at the National Police general headquarter's Multi-Purpose Center in Camp Rafael Crame, Quezon City. NONOY LACZA

[email protected] Tuesday, January 26, 2016 A5

AseanTuesday

IN this May, 20, 2013, �le photo, Nguyen Phu Trong (left), general secretary of the Communist Party of Vietnam, and Vietnamese Prime Minister Nguyen Tan Dung walk to the mausoleum of late President Ho Chi Minh in Hanoi. AP

1,510

Vietnam PM makes last-minute comeback in leadership battle VIETNAM’S pro-business

prime minister, who last week appeared to have

lost a power struggle in the ruling Communist Party, has made a last-minute comeback and will know on Monday if he can reenter the con-test for the top job in the country.

Using a loophole in party rules, supporters of Prime Minister Nguyen Tan Dung on Sunday pro-posed that his name be added to the list of candidates who can con-test for membership to the Central Committee, one of the two pillars of the ruling establishment.

If Dung makes it, he will stand a good chance to be elected to the committee, and then would be in a position to challenge his rival, General Secretary Nguyen Phu Trong, for his job. The party gen-eral secretary is the de facto No. 1 leader in the collective leadership that governs Vietnam.

“Dung is a skilled and deter-mined infighter and most people agreed there was still a remote chance that he would try to mount some sort of comeback,” said Mur-ray Hiebert, a Southeast Asian expert at the Center for Strate-gic and International Studies in Washington.

Trong has for years been try-ing unsuccessfully to sideline Dung, and while contests for the top post are not unheard of, they are usually settled well before the party congress, which take place once every five years to choose new leaders.

This year the rivalry between Dung and Trong has gone down to the wire into the party congress that began last Thursday and will end this Thursday. But regardless of who wins, the fundamental makeup of the government or its policies will not change radically, according to analysts.

Dung has built a reputation for promoting economic reforms, and being bold enough to confront China in its territorial aggression in the South China Sea. But even if Trong, a stolid party apparat-chik with closer leanings toward China, manages to sideline Dung eventually, it doesn’t mean the economic reforms would stall or Vietnam will capitulate to Chinese maritime aggression in Vietnam-ese waters, according to observers.

“Ideologically, there isn’t a yawning gap between Trong and Dung, although most people be-lieve that the pace of economic reform might slow a bit if Trong remains at the helm and Dung is ousted,” Hiebert told the Associ-ated Press.

Number of attendees to the Com-munist Party mem-bers that

will choose the 180 Central Committee members, who, in turn, will elect at least 16 members to the all-power-ful Vietnam Politburo.

For now, the road to the top is paved with hurdles for Dung. He faces the first one later Monday on the floor of the Communist Party congress that is being at-tended by 1,510 delegates behind closed doors.

The delegates will pick 234 candidates for an election to the 180-member Central Committee. Of these, 199 people endorsed by the outgoing committee are guar-anteed to be picked. The remain-ing 35 will be chosen from the 62 politicians proposed by some of the delegates, which includes Dung’s name.

If he does get chosen, he will still need to win an endorsement from the floor to make it to the fi-nal 180 in an election on Tuesday. After that, they will elect at least 16 members to the all-powerful Politburo, which handles the day to day governance of Vietnam. It is possible that the Politburo will be expanded to 18 members this year.

Of the Politburo members, one will be chosen the general secre-tary, the country’s top leader. Three others will be chosen, in respective order of seniority: the prime minis-ter, the president and the chairman of the national assembly.

Dung, who has risen through the ranks of the party and has held senior positions, is a two-term prime minister. This means he can’t be the prime minister for a third term, leaving only the gen-eral secretary’s post as a viable option. AP

MALAYSIAN Prime Minis-ter Najib Razak defended more stringent security

laws that were passed last year, saying they are needed to combat terrorism, even as critics warn they could be used against government detractors.

The threat from the radicalization of youths and religious extremism “is very real,” Najib said in a speech at an antiterrorism conference in Kuala Lumpur on Monday. Malaysia will not wait for an attack before putting measures in place, he said.

Malaysia, like other Southeast Asian nations, is grappling with the challenge of Islamic State (IS) and its citizens going to the Mid-dle East to fight. An antiterrorism law passed in 2015 allows suspects to be held for years without trial, bringing back security measures repealed in 2012 that were used mostly against the government’s political opponents.

“It is right to talk about strik-ing a balance between civil liber-ties and national security” but IS doesn’t care about such social norms, Najib said. “The best way to uphold civil liberties is to ensure the safety of the nation. I make no apology for taking every step to preserve that safety.”

Recruitment targetTHE government has said the laws are needed because Malaysia has become a target, as well as a source of recruitment for potential mili-tants. The measures—which have drawn critics, including the Malay-sian Bar and Human Rights Watch —allow for the jailing of suspects without trial, bypassing judicial re-views on detentions and putting of-fenders on a registry.

“When other countries have come under attack, some have ex-pressed their dismay that they do not have legislation which allows them to deal with the problem promptly and early,” Najib said. “I will not allow Malaysia to be so open to infiltration.”

In the past two years, Malay-sia has detained dozens for sus-pected links to terrorism groups, prevented its citizens from trav-eling to Syria and arrested those who returned after fighting there. Counterterrorism police are hold-ing seven people captured in a three-day operation across states in West Malaysia, Inspector General of Police Khalid Abu Bakar said in a Twitter post on Sunday.

Indonesia plans to revise its ex-isting antiterrorism law and will bar Indonesians joining IS from reentering the country, the govern-ment said, after militants linked to the group killed four people in a gun-and-bomb assault in central Jakarta this month. Southeast Asia, home to about 15 percent of the world’s 1.57 billion Muslims, has also seen local militant outfits carry out attacks over the years in Indo-nesia, southern Thailand and the southern Philippines.

A new and more comprehensive approach is needed to tackle ter-rorism and radical activity in view of its constantly changing nature, Malaysia Deputy Prime Minister Zahid Hamidi said at the same con-ference. Methods and approaches toward the rehabilitation of ter-rorists and extremists must also be reviewed, he said.

Human-rights activists have slammed a law implemented last year that revives detention without trial, and another law approved last month that gives sweeping pow-ers to a council led by the prime minister.

Police earlier said the IS group had posted a video that warns of attacks over the arrest of its members.

Bloomberg News, AP

A MEMBER of Malaysian military patrols outside a shopping mall in Kuala Lumpur, Malaysia, on Monday. Malaysia’s leader has defended strict security laws to �ght terrorism as the Islamic State group warned of revenge over a crackdown on its members. AP

Najib defends security laws amid growing terror threats

A BusinessMirror Special FeatureA6 Tuesday, January 26, 2016 | www.businessmirror.com.ph

Day 2016

In 2016 the Philippines and Aus-tralia jointly commemorate the 70th anniversary of our formal bilateral relations—although our friendship goes back further than this.

We are celebrating what Presi-dent Aquino describes as a long legacy of cooperation. In World War II 4,000 Australian soldiers fought side by side with Filipino and allied soldiers, and 96 Australians gave up their lives for the cause of freedom.

Rewind even further to the late 1800s, when skilled Filipinos traveledto Australia and were instrumental in the establishment of the pearl-diving and trading industry of Northern Australia.

In fact, the pearl is an apt metaphor for the Australia-Philippines relation-ship in that it has evolved in an organic way over time resulting in something that is precious and valuable.

Our modern relationship is deep and broad, re�ecting our shared values and common interests. �e signing of the Joint Declaration on Philippines-Australia Comprehensive Partnership on November 18, 2015 by Mr. Aquino and Prime Minister

Malcolm Turnbull marks a new era. �e Comprehensive Partnership

a�rms our commitment to cooper-ate across a broad range of activities, including on trade, development, de-fence, education, counterterrorism and transnational crime.

As a key development partner, Australia is committed to work with the government of the Philippines to promote prosperity, reduce poverty and enhance political stability.

�reats that ignore geographic boundaries cannot be managed by one

B A A G

Australia Day 2016: Celebrating #First70Years with the Philippines

country alone. We greatly value our strong and e�ective collaboration in maritime security, border control, peo-ple smuggling and counterterrorism.

Education ties continue a steady growth and I would love to see even more Filipinos studying in Austra-lia. In my short time in the Philip-pines, I have already met a num-ber of people of all ages who have studied in Australia. And Austra-lian students are studying in the Philippines under Australia’s New Colombo Plan. �ese experiences

forge bonds of understanding anda�ection that last a lifetime.

One of the most exciting aspects of our bilateral relationship is the increasing economic ties. �ere are over 200 Australian companies (em-ploying over 30,000 Filipinos) in the Philippines across a wide range of sectors—from business processing, �nance, professional services, oil and gas exploration, manufacturing, resources and infrastructure. Rep-resentatives of these companies tell me that they see great potential in

the Philippines and I am pleased to see that they are contributing to the communities that have welcomed them in very meaningful ways.

�ere are also Philippine com-panies exploring commercial op-portunities in Australia. And the 250,000-strong Philippine communityin Australia continue to make a very positive contribution to my country.

I am looking forward to a year of celebrations of the 70th An-niversary and I warmly encourageothers to join in.

It is a �tting time for us to recall the o�cial message from then-Aus-tralian Prime Minister Ben Chi�ey to incoming President Manuel A. Roxason the eve of Philippine indepen-dence in 1946—a message thatresonates today.

“It is my conviction that, if we maintain the friendship forged in war, we will never again see our lib-erties in peril. As free people, we now willingly cooperate in a joint e�ort to achieve a better world.”

Happy Australia Day and Mabuhay!

IFEEL very fortunate to arrive in the Philippines in time to celebrate Australia Day 2016 and

also at this most dynamic period in our bilateral relationship.

Australia

A BusinessMirror Special Feature A7www.businessmirror.com.ph | Tuesday, January 26, 2016

Day 2016AUSTRALIA prides itself with having strong trade

ties with the Philippines developed over the years through mutual cooperation and exchange. The

two-way trade ties between Australia and the Philippines are valued at approximately A$4.15 billion per annum. There are more than 200 Australian companies in the Philippines signi�cantly contributing to the country’s economic well-being. The companies’ com-mercial and economic contributions include employing thousands of Filipinos; paying local taxes; buying local materials and goods; and hiring the services of domes-tic companies and individuals. The following global Australian companies have thrown their support behind the Australia Day celebra-tion this year: ANZ BankANZ has been in the Philippines since 1990 and today services institutional and retail customers from its branch in Makati City. ANZ Philippines is a fully licensed universal bank providing domestic and foreign-curren-cy lending, trade and supply-chain services, payments and cash management, foreign exchange, commodity and interest-rate hedging products, debt-capital mar-kets and retail-banking services. AureconAS one of the world’s leading engineering, man-agement and technical services consultants, Aurecon is focused on adding significant value to clients’ businesses and ensuring reliable and effective delivery of infrastructure and projects. Aurecon’s Philippines office was established to support its international development business across the Asia-Pacific region. AustalAUSTAL is an Australian company that specializes in the design and construction of aluminium vessels. Its main products include passenger and freight ferries, luxury yachts and military vessels. Australian International SchoolTHE Australian International School is a multidis-ciplinary academic institution that specializes in bringing best practices in international education to the Philippines. Its goal is to have all its o�ered programs lead to or earn international certi�cation or recognition.

CardnoCARDNO is an ASX-200 professional infrastructure and environmental services company, with expertise in the development and improvement of physical and social infrastructure for communities around the world. Cardno’s vision is to be a world leader in the provision of professional services to improve the physical and social environment. Crone PartnersCRONE Partners is an international design and consulting �rm working in markets across Australia, China, Asia, In-dia and the Middle East. Its mission, based on innovation, creative thinking and a sustainable environment, contin-ues to lay the important foundations for the well-being of the global community and its environment. IDPIDP is a global leader in international student place-ment and co-owner of the world’s most popular Eng-lish language test. IDP Philippines has been involved in education services for the Filipino people for almost 30 years. The main o�ce is in Makati City, with another branch in Cebu. MacquarieMACQUARIE Group is a global �nancial services pro-vider. It acts primarily as an investment intermedi-ary for institutional, corporate and retail clients, and counterparties around the world. Macquarie’s diverse range of services includes corporate �nance and advi-sory, equities research and broking, funds and asset management, foreign exchange, �xed-income and commodities trading, lending and leasing, and private wealth management. Meat and Livestock AustraliaMEAT and Livestock Australia Ltd. (MLA) delivers market-ing and research and development services for Australia’s cattle, sheep and goat producers. MLA creates opportu-nities for livestock-supply chains from their combined investments to build demand and productivity.

OceanaGoldOCEANAGOLD is a signi�cant multinational gold pro-ducer with four operating gold mines and a portfolio of development and exploration assets in the South Island of New Zealand and the northern Philippines.

QantasFOUNDED in regional Queensland in 1920—as the Queensland and Northern Territory Aerial Service—Qantas is one of Australia’s most iconic brands and has played a central role in the development of the Australian and international aviation industry. Today the Qantas Group is a diverse global aviation business, comprising Qantas Domestic, Qantas International, the Jetstar low-cost carrier group and Qantas Loyalty. QBE GroupQBE Insurance Group Ltd. is Australia’s largest global insurer. It provides insurance services mainly to Austra-lia, America, Europe and Asia-Paci�c region. As of 2014, it has over 16,000 employees in 52 countries. Greenstone Resources Corp.GREENSTONE Resources Corp. (GRC) is a registered Philip-pine company and an a�liate of Red 5 Ltd., a Western Australia-based gold-exploration company whose shares are traded in the Australian Stock Exchange. GRC has in-terest in the Siana Gold Project (MPSA 184-2002-XIII) and the Mapawa Gold Project (MPSA 280-2009-XIII), both in Surigao del Norte. SMECSMEC is recognized around the world for providing high quality, practical solutions for physical and social infrastructure projects. SMEC aligns technical expertise with local knowledge to address the needs of its di-verse client base. SMEC has 5,400-plus employees and an established network of over 75 o�ces in more than 40 countries across Australia, Asia, the Middle East, Af-rica, and North and South America. TelstraTELSTRA is a leading telecommunications and Infor-mation services company headquartered in Australia, with international operations based out of Hong Kong. Its success story comes from deep understanding and experience in the Asian market for over 30 years. Within the Philippines, Telstra has the �exibil-ity, agility and expertise to serve customers operating within the region, as well as businesses from Europe, the Americas and other global companies, looking to expand into the country and wider Asia. Its operations in the Philippines serve both global enterprises and wholesale carrier businesses.

TRADE TIES BOOST 70TH ANNIVERSARY CELEBRATION

The WorldBusinessMirrorA8 Editor: Lyn Resurreccion • [email protected], January 26, 2016

NEW YORK—� e blizzard-blanketed Eastern US will confront a Monday commute

slowed by slick roads, damaged transit lines and endless mounds of snow, after a weekend of sledding, snowboarding and staying put.

Authorities cautioned against unnecessary driving; airline sched-ules were in disarray; and com-muter trains will be delayed or can-celed for many, as the work week begins after a storm that dumped near record snows on the densely populated Washington, D.C., to

New York City corridor.� e last � akes fell just before

midnight on Saturday, but crews raced the clock all day on Sunday to clear streets and sidewalks devoid of their usual bustle.

Ice chunks plunging from the roofs of tall buildings menaced peo-

ple who ventured out in Philadelphia and New York. High winds on Man-hattan’s Upper West Side kept the snow from entirely swallowing the tiny Mini Cooper of Daniel Bard-man, who nervously watched for falling icicles as he dug out.

New York Mayor Bill de Blasio encouraged people to leave their plowed-in cars covered with snow all week after a one-day record of 26.6 inches (67.6 centimeters) fell in Central Park.

Treacherous conditions remained as people recovered from a storm that dropped snow from the Gulf Coast to New England. At least 30 deaths were blamed on the weather, with shoveling snow and breathing carbon monoxide collec-tively claiming almost as many lives as car crashes.

Broadway reopened after going

dark at the last minute during the snowstorm, but museums remained closed in Washington and the House of Representatives postponed votes until February, citing the storm’s im-pact on travel.

Flying remained particularly

messy after nearly 12,000 weekend � ights were canceled. Airports re-sumed limited service in New York City, Baltimore and Philadelphia, which said it got an entire winter’s snow in two days. Washington-area airports remained closed on Sunday after the punishing blizzard.

Major airlines also canceled hundreds of � ights for Monday. Along with clearing snow and ice from facilities and equipment, the operators of airlines, train and transit systems had to � gure out how to get snowbound employees to work.

Overall snowfall of 26.8 inches (68 cm) in Central Park made it New York’s second-biggest win-ter storm since records began in 1869, and Saturday’s 26.6 inches (67.6 cm) made for a single-day re-cord in the city. AP

After emerging from blizzard, East Coast still faces diffi cult commute KABUL, Afghanistan—After months

of ferocious � ghting, Afghan army units battling the Taliban in south-

ern Helmand province are facing major restructuring and leadership changes, with several key commanders being replaced, a US military o� cial said on Monday.

Helmand has been a � erce battle-ground since last fall, with � ghting taking place in 10 districts. At times, the insur-gents have laid siege on army bases and threatened to overrun large chunks of territory. Local o� cials have called for help from central authorities and com-plained publicly over corruption that in-cludes syphoning o� salaries, food, fuel and equipment.

US Army Brig. Gen. Wilson Sho� ner, the head of public a� airs for the US-North At-lantic Treaty Organization (Nato) mission, told The Associated Press that the Afghan army corps in Helmand is now being “re-built” and that senior o� cers are being replaced.

The reasons for the changes in the Afghan army’s 215 Maiwand Corps “are a combination of incompetence, corrup-tion and ine� ectiveness,” Sho� ner said. The corps’ commander has been replaced, along with “some brigade commanders and some key corps sta� up to full colonel level,” he said.

Helmand is a strategic region for the Taliban, as it borders Pakistan. It grows large quantities of opium, used to produce most of the world’s heroin. The harvest is worth up to $3 billion a year, and helps fund the insurgency.

The Afghan Defense Ministry con-� rmed the changes in Helmand. It said veteran army Gen. Moheen Faqiri was ap-pointed to lead the corps and took over two months ago.

Gen. Dawlat Waziri, the ministry’s spokesman, said brigade commanders have also been rotated out and replaced.

“Soon, other army units will have new commanders there,” Waziri said.

Last October a meeting of the National Security Council (NSC) discussed the worsening situation on the ground. In the presence of President Ashraf Ghani and US Army Gen. John F. Campbell, commander of the US and Nato forces in Afghanistan, the NSC heard that Afghan security forces were badly led, poorly equipped and in the previous three months had su� ered 900 casualties, in-cluding 300 dead.

Minutes of the October 29 meeting, obtained by the AP, show that Helmand was described by the former head of the intelligence agency, Rahmatullah Nabil, as “the biggest recruiting pool for the Taliban” and the insurgents’ “primary source of revenue” from poppy for heroin and marble smuggling.

Another concern is the Afghan police who are � ghting on the frontlines across Helmand, often without the equipment and backup of the army, which means ca-sualties are higher.

Last Wednesday Gen. Abdul Rahman Sarjang, the Helmand provincial police chief, said the Afghan security forces were “exhausted” and in dire need of re-inforcements. AP

US official: Afghan army ‘rebuilt’ for battle with Taliban

SAINT JOHN’S, Newfoundland—Seven people were taken to hos-pital after an American Airlines

plane from Miami to Milan made an emergency landing in Newfoundland after the jet brie� y encountered se-vere turbulence.

� e aircraft landed safely in the East Coast Canadian province late Sunday, where it was met by paramedics.

American Airlines Spokesman Ross Feinstein said three � ight attendants and four passengers were transport-ed to hospital for further evaluation. He said none of the injuries are life threatening.

� e seat-belt light was on when the Boeing 767, carrying 192 passen-gers and 11 crew members, encoun-tered turbulence.

At least four ambulances and a � re truck were seen on the tarmac in Saint John’s, Newfoundland. Para-medics rushed toward the plane with stretchers and what appeared to be a backboard.

An hour after the plane landed, one ambulance remained.

Feinstein said they are working on next steps to get the uninjured pas-sengers to Milan.

Sara Norris, a spokesman for Staint John’s airport, said the plane will stay in Saint John’s overnight. AP

7 hurt on American Airlines jet; plane diverts to Canada BEIJING—Two Chinese citizens have

been killed and one injured in a sus-pected bomb attack in central Lao

PDR, China’s o� cial Xinhua News Agency reported on Monday. A mountainous area that in recent months has seen an increase in violence and in years past was the scene of clashes between government forces and the Hmong ethnic minority.

The incident took place about 8 a.m. on Sunday in the province of Xaysomboun (pronounced Sai-sum-boon) when the victims, one of whom was employed by a Chinese mining company, were riding in a vehicle, Xinhua reported.

Chinese diplomats have visited the sur-vivor, identi� ed by the surname Zhou, and have requested a swift investigation, Xin-hua said. An o� cial contacted at the Laos Embassy in Vietnam, the country’s closest ally, said he was unaware of the report.

China is a major investor in Laos’s rich abundance of minerals and other natural resources and shares its one-party form of authoritarian communist government. A special Chinese presidential envoy, Song Tao, is due to visit the country this week, Xinhua said.

Since November there has been an in-crease in violence in the province, though the perpetrators have not been identi� ed, nor has the tightly controlled state press provided any details.

In a notice posted on its web site, the US Embassy in Laos last November prohibited

its employees from traveling to Xaysom-boun province due to what it described as nighttime shooting attacks by un-identi� ed assailants. It said one person was killed on November 17 and another wounded on November 18.

The Hmong fought on the side of a pro-American regime during the Vietnam War, and after the commu-nist Pathet Lao took over in 1975, many � ed abroad or hid in the jungle. Until a few years ago, there were several small bands of Hmong resisters who contin-ued to hide in the jungle and occasion-ally clash with security forces, but most eventually surrendered.

The US government-funded news service Radio Free Asia (RFA) has reported additional attacks in November, Decem-ber and January, citing unnamed police and other sources. In the latest reported attack, a bus came under � re on January 14, leaving about a dozen passengers hurt but none killed, RFA said.

While RFA’s reports could not be in-dependently con� rmed, it has a record of being well-informed about Laotian a� airs.

In a report forwarded to The Associat-ed Press earlier this month, Hmong sympa-thizers gave their own version of the recent violence, saying that from mid-November until the end of December, there had been six attacks by government forces on groups of Hmong, killing at least seven and wounding 21. AP

2 Chinese killed in LaoPDR suspected bombing

ANGELO DELACRUS (right), 15, of Passaic, who came from the Dominican Republic recently, shovels snow in the middle of Van Buren Street in Passaic, New Jersey, on January 24. KEVIN R. WEXLER/THE RECORD OF BERGEN COUNTY VIA AP

AN ambulance departs Saint John’s International Airport on January 24, in Saint John’s, Newfoundland. Several people were taken to hospital after an American Airlines plane from Miami to Milan made an emergency landing after the jet brie� y encountered severe turbulence. PAUL DALY/THE CANADIAN PRESS VIA AP

Flights canceled after major airlines stopped operations following the blizzard that dumped near-record snows on the area

12,000

A9

The [email protected] Tuesday, January 26, 2016

� e cold wave abruptly pushed temperatures to a 16-year record-low of 4 degree Celsius (39.2° Fahren-heit) in the subtropical capital where most homes lack central heating, causing heart trouble and shortness of breath for many of the victims, a city o� cial said.

“In our experience, it’s not the actual temperature but the sudden drop that’s too sudden for people’s circulatory systems,” said a city spokesman who identi� ed himself only by his surname, Chang.

� e cold snap was blamed for the deaths of 40 people in the capi-tal, Taipei, while the neighboring New Taipei City attributed an addi-tional 17 deaths to the cold weath-er. Strokes and hypothermia were among the causes of death in New Taipei City, o� cials there said.

Temperatures in Taipei average 16°C (60 degrees F) in January, ac-cording to Taiwan’s Central Weather Bureau. Because of the relatively mild norms, most households in Taiwan lack central heating, another suspected factor in the recent deaths.

New Taipei City said it was pro-viding shelter for 91 homeless people endangered by the cold.

� e cold front also left 9 centi-meters (3.5 inches) of snow on Tai-pei’s highest peak on Saturday and stranded vehicles as people headed into the mountains to see the snow.

� e same polar front closed schools on Monday in Hong Kong, where 130 people had been trapped at day earlier on a peak in the city that also seldom gets such cold weather. Hong Kong temperatures reached 3.1° on Sunday.

Temperatures in Taipei are fore-cast to reach 17° on Tuesday. AP

Deaths blamed on rare cold snap in Taiwan

Video shows Paris attackers committing earlier IS atrocities

JERUSALEM—A doctor treat-ing 92-year-old former Israeli President Shimon Peres says he

is “doing great” after spending the night in hospital.

Peres was rushed to hospital on Sunday night with chest pains, days after he su� ered a mild heart attack.

Doctors detected an irregular heart rate and Peres was monitored in hospital overnight as a precaution.

Peres’s personal physician Raphi Walden told Israeli Army Radio on Monday that Peres’s heart rate had returned to normal. He says it’s not yet clear when Peres would be discharged.

Peres, a Noble Peace Prize laure-ate, completed his seven-year term as president in 2014. He remains active through his non-governmental Peres Center for Peace, which promotes co-existence between Arabs and Jews.

In his seven-decade political career, Peres also served three brief stints as prime minister. AP

LISBON, Portugal—A center-right candidate scored a re-sounding victory in Portugal’s

presidential election on Sunday, warning he would use the largely cer-emonial post to prevent the center-left anti-austerity government from worsening the debt-heavy country’s � nancial health.

Marcelo Rebelo de Sousa, a veter-an-moderate politician and law pro-fessor, collected more than half the votes against nine rivals.

With 99 percent of the votes counted, Rebelo de Sousa won 52 percent, while his nearest rival came in with less than half of that.

Rebelo de Sousa will move into the head of state’s riverside pink palace in Lisbon in March, replacing Anibal Cavaco Silva, who has served the maximum of two � ve-year terms.

The president has no executive pow-er, and is largely a figurehead, but can be an influential voice and in a crisis has the power to dissolve Parliament if he feels the country is going o� track.

A Socialist minority govern-ment runs Portugal with the back-ing of the Communist Party and the radical Left Bloc. � e govern-ment is trying to pull o� a balancing act by ending austerity measures while pledging to continue the � nancial pru-dence adopted after Portugal’s €78-bil-lion ($84-billion) bailout in 2011 amid a eurozone financial crisis.

� e government’s critics say that is a risky policy in Portugal whose

economy is struggling to gain mo-mentum and where the jobless rate is over 11 percent.

Rebelo de Sousa said in his victory speech he expected the government to generate more economic growth “without compro-mising � nancial stability.”

At the same time, he promised to be impartial and encourage consen-sus between political parties, “heal-ing the wounds” of the recent crisis.

Prime Minister Antonio Costa vowed his “full cooperation” with the president.

Rebelo de Sousa, 67, has had a long

career in the public eye, working as a newspaper editor, a popular media pundit, a junior member of govern-ments since the 1970s, and a former member of the European Parliament.

Turnout was low on Sunday at 52 percent after a dull two-week campaign. AP

Portugal’s new president demands financial discipline Israeli doctor: Peres is fi ne after being rushed to hospital

MARCELO REBELO DE SOUSA addresses journalists and supporters after winning Portugal’s presidential election on January 24, in Lisbon. Rebelo de Sousa, a veteran center-right politician who became a popular television personality, recorded an emphatic victory in Portugal’s presidential election on Sunday, collecting more than half of the votes against nine rivals as the Portuguese chose a counterweight to the country’s center-left Socialist government. AP/ARMANDO FRANCA

THIS � le image made from video posted on a militant web site on July 5, 2014, purports to show the leader of the Islamic State group, Abu Bakr al-Baghdadi, delivering a sermon at a mosque in Iraq during his � rst public appearance. AP/MILITANT VIDEO, FILE

PARIS—A new video released by the Islamic State (IS) group purports to show the militants

who carried out the November 13 attacks in Paris committing atroci-ties in IS-controlled territory, while plotting the slaughter in the French capital that left 130 people dead and hundreds wounded. � e group also threatens to attack Britain.

� e 17-minute video, which was released on Sunday, shows the extent of the planning that went into the multiple attacks in Paris, which French authorities have said from the begin-ning were planned in Syria. It is also likely meant to serve as a recruitment tool to rally followers to the extremists’ sinister cause. � e video was provided online by the SITE Intelligence Group, which monitors jihadi web sites.

All nine militants seen in the video died in the Paris attacks or their af-termath. Seven of the attackers—

four from Belgium and three from France—spoke � uent French. � e two others—identi� ed by their noms de guerre as Iraqis—spoke in Arabic.

Seven of the militants, including a 20-year-old who was the youngest of the group, were � lmed standing behind bound captives, described as “apostates,” who were either be-headed or shot.

“Soon on the Champs-Elysees,” says Samy Amimour, who was raised in a Paris suburb near the French na-tional stadium, as he holds a captive’s head aloft.

� e November 13 attacks targeted a packed concert hall, a restaurant and cafe, and a soccer match at the national stadium.

French Foreign Ministry spokes-man Romain Nadal said the govern-ment is studying the video but would not comment on its contents. France’s Interior Ministry and the Paris prosecu-

tor’s o� ce had no immediate comment.� e video was apparently � lmed

before the men sneaked back into Eu-rope and contains no footage shot by the attackers during the days of terror that began November 13 and ended only last November 18 with the death of Abdelhamid Abbaoud, who was be-lieved to be the leader of the attacks.

Abaaoud died in a police raid on an apartment near the Stade de France.

Instead, it was assembled from material shot before the men left for Paris, news video and amateur video. � e video did not specify where the nine men were � lmed, but it was be-lieved to have been in IS-controlled territory in Syria. Abbaoud is seen simply speaking in a room

One militant, Brahim Abdeslam, is seen at a makeshift shooting range. Abdeslam, whose brother Salah � ed Paris that night and remains at large, blew himself up at a Paris café where

he was the only victim. Salah Ab-deslam is not seen in the video.

According to the anti-IS activist group Raqqa is Being Slaughtered Silently, Brahim Abdeslam and two other attackers were trained in Raqqa, the extremist group’s strong-hold and the capital of its self-pro-claimed caliphate.

In the video, as in other IS pro-paganda trying to drive a wedge be-tween European Muslims and their governments, the men say it is a reli-gious duty to join them.

� ey threaten more attacks in Europe, and the footage closes with one of the militants holding a sev-ered head and footage of Cameron giving a speech—with a text in Eng-lish warning that whoever stands with the unbelievers “will be a target for our swords.”

� e video was released by Alhayat, the IS group’s media arm. AP

TAIPEI, Taiwan—An unusu-ally cold weather front has been blamed for killing 57

mostly-elderly people in Taiwan’s greater-Taipei area.

57People killed-mostly elderly citizens—in Taiwan’s greater Taipei area because of severely cold weather.

MANAGUA, Nicaragua—Ni-caragua’s police, army and navy will investigate the

captain of a tourist boat and his as-sistant for the deaths of 13 Costa Ri-can passengers killed when the vessel capsized in bad weather, a top govern-ment o� cial said on Sunday.

� e “Reina del Caribe,” Spanish for “Caribbean Queen,” was carrying 33 people when it went down on Sat-urday amid rain and strong winds, as it ferried between the Corn Islands, a popular tourist destination, o� Nica-ragua’s Caribbean coast.

Government spokesman Rosario Murillo clari� ed on Sunday that the boat was carrying 25 Costa Ricans, two Americans, two British citizens, a Brazilian and three Nicaraguans. Pre-vious reports had said there were 32 people on board including four Amer-icans. All the dead were Costa Ricans, mainly women, Murillo said.

“� is is a great tragedy, truly pain-ful, because they were our Costa Ri-can, Central American brothers and sisters who were vacationing in the waters of the Nicaraguan Caribbean,” Murillo said on Saturday.

Mario Berrios, the Nicaraguan navy’s commander for the southern Caribbean region, said the boat’s cap-tain was detained because the vessel was not supposed to be sailing during the inclement weather that had been lashing the region for several days.

“� ere was a warning that the weather conditions would be bad, but it appears that was ignored and this tragedy happened,” Berrios said. Au-thorities had suspended boat launch-es in the area due to winds reaching 25 to 30 knots (29 miles per hour to 35 mph).

On Sunday, Murillo said that Nica-raguan President Daniel Ortega had ordered police, along with the army and navy, to determine who was to blame for the tragedy. She said the captain and his assistant would be le-gally processed for the 13 deaths.

“Everyone is honestly moved and consternated by what has happened, but we also must make sure this doesn’t happen again. � ose to blame for this tragedy must be processed...all the established penalties must be applied to those responsible,” she said.

Rescue workers on Sunday were still trying to retrieve the bodies of four of the dead Costa Ricans after the ropes on a boat carrying them to land snapped in bad weather.

Nicaraguan authorities were working with their Costa Rican counterparts to repatriate bodies late Sunday. AP

TOURIST BOAT CAPTAIN TO BE PROBED FOR TRAGEDY OFF NICARAGUA

PESHAWAR, Pakistan—O� cials say a northwestern Pakistani university where Islamic militants gunned down

21 students and teachers last week has re-opened for classes amid tight security.

University o� cial Kabir Khan says class-es at the Bacha Khan University in the town of Charsadda resumed on Monday. Police o� cial Iqbal Khan says extra security mea-sures are in place.

The attack last Wednesday triggered a gunbattle that lasted for hours until all four militants who took part in the raid were killed. The assault shocked the nation and raised grim memories of the December 2014 massacre in the nearby city of Pesha-war where the Taliban killed 150, mostly children. Over the weekend, Pakistani of-� cials said they arrested � ve suspects on charges of facilitating the Charsadda as-sault, which was claimed by a breakaway Taliban faction. AP

Days after militant attack, Pakistani university reopens

FORMER Israeli President Shimon Peres speaks during an interview with The Associated Press in Jerusalem. AP

Tuesday, January 26, 2016 • Editor: Angel R. Calso

OpinionBusinessMirrorA10

Why Indonesia gets high-speed rail

editorial

THE president of the Philippines jokes about getting run over by a train. The president of Indonesia actually builds a rail- transit system. During his presidential campaign in 2014, Joko Widodo

vowed to increase government spending for infrastructure and transportation. A plan for a high-speed rail line had been in discussion since 2008, as Japan wanted to export and build its Shinkansen high-speed railway in Indonesia.

After Widodo took office, he halted the project, citing the high cost to the government of the Japanese proposal. However, in April 2015, the Chinese government approached Jakarta with a counterproposal. Widodo traveled to Beijing, as he had previously to Tokyo, to meet personally with the government officials to discuss the proposal.

After typical government complications with the bidding and awarding process, Widodo again canceled the project on September 3, 2015. Indonesia’s president felt that the gov-ernment was still taking on too great a financial burden and risk. Widodo did not want government loan guarantees for the high-speed rail system nor to put the government on the hook for paying for the project.

By mid-September, the Chinese government had responded and accepted all the de-mands of the Indonesian president. Construction of the rail project started this past week.

The state-owned China Development Bank will provide 75 percent of the $5.5-billion fund-ing, with the rest coming from the Chinese railway company and an Indonesian consortium. The Indonesian government will not directly provide any money to build the rail system. Several government-owned profit-making companies are involved, but no construction or operating funds will be sourced from the national treasury. The loan will be paid from rail revenues. Fares will still be controlled by existing Indonesian regulatory authorities.

The Chinese will also establish other Indonesian private joint ventures to locally produce up to 40 percent of all the equipment for the rail system and provide cost-free technology transfers for the Indonesians to make their own trains. This will include manufacturing for light-rail systems also for export. The Chinese-led consortium will also pay for the building of new and upgrading of existing rail stations.

Indonesia will build the first high-speed rail system in the region. The 150-kilometer rail line from Jakarta to Bandung City will be funded through a Chinese loan that will not be guaranteed by the Indonesian government. Several rural areas will be opened up for new development. Direct investment and free rail-technology transfer will make Indonesia a potential exporter of rail equipment to the region. Forty percent of the equipment for the new system will be locally manufactured, creating more jobs.

It is amazing what can be accomplished when experienced leadership combined with determination to get infrastructure projects done while leveraging the China-Japan rival-ry. Our close relationship with the US gives the Philippines used military equipment that we have to pay to ship here and continuous headlines of “US Companies Eye Investment Opportunities in the Philippines.”

Where’s our high-speed rail? Second of a series

SHAKY doesn’t necessarily mean the Philippine economy will slow down in 2016. On the contrary, the consensus is that growth in terms of GDP will be higher in 2016 compared to

2015, for which earlier forecasts have been downgraded.

Shaky start, cautious optimism

In its Global Economic Prospects (GEP) report, the World Bank said the economy would grow by 6.4 percent in 2016 on the back of the May elections.

The International Monetary Fund (IMF) sees 2016 GDP growth at 6.2 percent, while the United Nations Economic and Social Commission for Asia and the Pacific (Unescap) is expecting growth at 6.3 percent.

As I said earlier, we could still hit the 7-percent GDP growth, at least in the first half, as long as the

government continues to ramp up spending. Incidentally, my forecast was followed by the government’s own announcement that it would target 7-percent growth in the first semester.

And if the next administration, recognizing the uncertainties in the global economy, maintains an ag-gressive stance to capitalize on our strengths, we may even sustain above 6-percent growth for the whole year.

That, of course, will depend on the economy’s performance in the

first semester. First-half growth is crucial in some ways. For instance, with a new administration in place, a high growth rate in the first half will help boost investor confidence. Traditionally, investors always adopt a wait-and-see attitude during a presidential election; they want to see how the new chief executive will direct the economy.

The slowdown in China has af-fected stock markets around the world, including the Philippines. Fortunately, the China slowdown’s local impact has been mainly lim-ited to the domestic stock market; other sectors of the economy, such

as real estate, retail business and the business-process outsourcing indus-try, continue to enjoy robust growth.

These are among the factors that I believe will drive the Phil-ippine economy this year. On the external front, declining oil pric-es will help offset the impact of the strengthening of the dollar and higher interest rates in the United States.

From over $100 a barrel in 2014, world oil prices plunged to below $28 on January 18, the same price level as in 2003. The price drop followed the lifting of sanctions on Iran, which paved the way for higher oil exports from the Islamic Republic at a time when global oil supplies are already outstripping demand.

Because of the low oil prices, the public-transport sector in the Philip-pines has voluntarily petitioned the government to roll back fare rates, which will directly benefit the mass of Filipino consumers.

To be continued

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

THE ENTREPRENEURManny B. Villar

ALL stock-market investors look at price and movement. Some investors look at trading volume. A very few look at time.

Conventional thinking about the stock market is linear in that all that matters is the price of an issue. We may consider the trading volume to measure momentum. But, basically, all the average investor cares about is if the price is going up and down, and how much that movement might be. It is only a number.

PSE: After capitulation

OUTSIDE THE BOXJohn Mangun

Yet, we know that in measur-ing the real world in numbers, the “world” is not flat. Basic linear arith-metic leads to three-dimensional geometry and eventually the study of change —calculus.

Time is as critical and necessary to calculating turning points in stock- market prices as the price itself. Capitulation is a turning point in stock-price movement at a particular level and at a particular time.

The capitulation at end 2008/early 2009 at the 1,850 area on the

stock-market index came as expected at the right price, as that was a criti-cal level in 2005 and 1997.

October 2008 saw very heavy volume—a supposed sign of capit-ulation—but the index was down 24 percent, falling too far too fast. When it hit that price in October 2008, it was too soon and, therefore, the index stayed at the capitulation area for another four months.

However, that four-month peri-od saw high volatility, with weekly index changes of 5-percent to even

10-percent up and down moves. Therefore, the initial October price drop was not capitulation but a re-action low that then creates “sling-shot” price movements that often end up being traps on both the up-side and the downside.

The week of November 17, 2008, saw the market down 10.7 percent; the following week the index went 11.7 percent higher. By March 2009, the index was back to the November 17, 2008, low with both buyers and sellers being whipsawed around.

The end of the capitulation came

in March 2009 on relatively low vol-ume, and prices started taking off in April 2009.

This current price movement is unlikely to be capitulation; it is both too soon and not the right price for an end to this downtrend. Baron Rothschild is credited with saying that “The time to buy is when there’s blood in the streets.” We are not there yet. But it is a good—maybe a great —short-term opportunity to make profits on the slingshot action.

It is what happens after the ca-pitulation comes that you need to be focused on. A bottom on the market will then see prices move 20 percent higher but probably not any more than that. Do not hesitate to buy when the bottom hits.

However, a monthly close below the capitulation price or a delayed move to that price too late will push prices down 20 percent. The fun of 2016 has just begun.

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

Conventional thinking about the stock market is linear in that all that matters is the price of an issue. We may consider the trading volume to measure momentum. But, basically, all the average investor cares about is if the price is going up and down, and how much that movement might be. It is only a number.

As I said earlier, we could still hit the 7-percent GDP growth, at least in the first half, as long as the government continues to ramp up spending. Inciden-tally, my forecast was followed by the government’s own announcement that it would target 7-percent growth in the first semester.

Tuesday, January 26, 2016

[email protected]

THIS week the Philippines will formally welcome Japanese Emperor Akihito and Empress Michiko for a historic five-day state visit—more than five decades after their majesties first

set foot on our shores as Crown Prince and Crown Princess. Their visit coincides with the 60th anniversary of the normalization of Philippine-Japanese diplomatic ties, which have grown closer and deeper after World War II.

Welcoming the Japanese Emperor and Empress

Despite Manila being the most devastated city after the war, next only to Warsaw, Filipinos appear to be quicker than most to forgive and reconcile with their former enemy. Perhaps, this is because the Philippines and Japan have long maintained good relations as early as colonial times—even before Japan adopted its sakoku policy

of national isolation. As early as the 1600s, around

the tail-end of the Ashikaga sho-gunate, Japanese traders and mer-chants settled in Luzon, forming a 3,000-strong community in the Manila suburb of Santa Ana. We now call this area Plaza Dilao along Quirino Ave.

Between 1903 and 1905, up to

2,800 Japanese workers and labor-ers came to the Philippines to help with the construction of Kennon Road, connecting Manila to Baguio City, which the Americans dubbed as the Summer Capital of the Phil-ippines. Some of these construc-tion workers settled in La Trinidad, Benguet, and helped jumpstart the area’s development into the country’s vegetable bowl.

By the 1930s, many Japanese nationals immigrated to what would now be Davao City, where they opened up the fertile Davao soil to banana and abaca planta-tions that today serve the inter-national market.

During the 1970s, Philippine-Japanese relations expanded, with Japan becoming a significant source of trade, investment and developmental aid.

Through the years, I have wit-nessed that relationship grow from business to academia and to parlia-mentary exchange.

In 1988 I initiated the Philip-pine-Japanese Parliamentarians Association, where members of the Japanese Diet and the Philippine Congress have conducted several exchange visits. Some sensitive so-cial issues between the Philippines and Japan—such as visas for enter-tainers—were informally resolved through the society.

And in 2006, we helped push for the ratification of the Japan-Philippines Economic Partnership Agreement. Trade and investment increased as a result, and Japan’s tightly closed labor market started opening up to Filipinos.

Throughout the postwar years, the Philippines and Japan have gradually forged closer relations, despite remembrance of a tragic and cruel past. Emperor Akihito’s and Empress Michiko’s unprecedented visit marks a historical step toward even deeper relations.

E-mail: [email protected].

IS there a fundamental difference between war fought for reasons of belief and war fought out of self-interest? Is one more primitive than the other, or morally superior?

Mamasapano: Was there a cover-up?

YESTERDAY, January 25, marked the first anniversary of the Mamasapano massacre where 44 members of the Special Action Force of the Philippine National Police were mowed

down by rebels belonging to the Moro Islamic Liberation Front and the Bangsamoro Islamic Freedom Fighters. One year later, families of the Fallen 44 are still hoping that justice would be served for the death of their loved ones, and the nation still awaits closure of a trag-ic incident that had clearly setback efforts to restore peace in Muslim Mindanao after decades of armed conflict.

While the Department of Justice has already filed charges against a number of identified assailants in Mamasapano, it is understandable that police authorities are unwill-ing to serve the warrants of arrest for rebels believed to be still fully armed and ready to fight. So the quest for closure and justice is still very much alive.

The latest Saturday Forum@An-nabel’s was full-packed as our main guest, retired Police Chief Supt. Diosdado T. Valeroso, indicated that he had what he described as “critical evidence” that, indeed, there has been an attempt to cover up ultimate responsibility for the botched police operation.

Valeroso is one of founders of the Young Officers Union (YOU) that launched a series of coup d’état during the Cory Aquino adminis-tration. His last assignment at the time of his retirement in July last year was as deputy chief for Admin-istration of the National Capital Region Police Office.

According to Valeroso, he has in his possession a digital audio recording of a conversation between a “high-ranking” government official and a lawmaker about Mamasapano, and that he received a copy of the record-ing last Tuesday, via e-mail.

The former police official said the 15-minute conversation took place “a day or two” after the incident. The two persons in the audio recording, he said, were talking about a cover-up of Mamasapano to avoid any adverse effect on the pending Bangsamoro basic law (BBL) in Congress.

Valeroso declined to name the two persons who were apparently having a face-to-face conversation in the audio recording. He also declined to name the source of the audio recording. He said he would submit the audio re-cording to the Senate Committee on Public Order and Dangerous Drugs, chaired by Sen. Grace Poe, which is set to reopen the Mamasapano probe tomorrow, January 27. It’s the Senate, he said, that should determine the authenticity of the audio recording by consulting technical experts.

It was Senate Minority Leader Juan Ponce Enrile who requested a reopening of the Mamasapano probe. He said he has proof that Presi-dent Aquino “actively and directly involved himself in the planning and

preparation of Oplan Exodus.” What Enrile and Valeroso would present to the Senate has been the subject of much speculation. Malaca-ñang insists that President Aquino has said everything the public should know about Mamasapano. But if En-rile and Valeroso would be able to come up with the “smoking gun,” or indisputable evidence that Aquino had a direct hand in the events that led to the slaughter of the 44 police commandos, as well as what many believe is a cover-up of what really happened, then, perhaps, a definite closure to Mamasapano could be in the offing. Or is this too much wish-ful thinking?

Face-off in Manila AT the sidelines of our Saturday news forum, I managed to ask Party-List Rep. Lito Atienza of Buhay, who is a former mayor of Manila and is now running for senator on the slate of the United Nationalist Alliance (UNA), what he thinks of the three-cornered fight shaping up in the capital city of Manila with incumbent Mayor Jo-seph Estrada, former Mayor Alfredo Lim and Rep. Amado Bagatsing of Manila trying to court the votes of city residents. Atienza’s fearless forecast is that Manileños would dump Erap’s re-election bid. Why? Because the for-mer president, he said, has not done anything for the city in the past three years. “Hindi nagtatrabaho” is how he described Erap in so many words. “There’s garbage everywhere, the streets are dimly lit,” he said, adding that residents are also up in arms against the unreasonable increase in real-estate taxes. For Atienza, Lim could return to City Hall because he already has a “brand,” having occupied City Hall before. Even if the former senator and mayor is already 86 years old, Atienza believes “Dirty Harry” could stage a surprising comeback once the votes are counted in the May elections. As for Bagatsing, Atienza said the congressman is not likely to win if the latter does not go all-out in the campaign and make himself visible and press flesh in every barangay in the city, instead of calling meetings of local leaders and waiting for them to come to him.

E-mail: [email protected].

ABOUT TOWNErnesto M. Hilario

Sen. Edgardo J. Angara

It emerges that these functional, self-interest-based explanations reflect a set of disciplinary assump-tions about why humans fight. Many students of human behavior think that people act self-interestedly. Even when they speak in terms of ideology or cultural values, this can be described as a proxy for underly-ing self-interest.

In my view, it’s an analytic mis-take to think that self-interest al-ways underlies human motivation. Culture and the beliefs that go with it aren’t merely naked reflections of evolutionary impulses.

Once humans can think, they can define their own self-interest in ways that might conflict with self-interest narrowly defined. They can act based on moral values, laws and other kids of norms—or against them.

This brings us to the fight against IS, whose members are surely mo-tivated by their beliefs, not their self-interest in the ordinary sense.

The countr ies around IS ’s

territory in Syria and Iraq all reject the Sunni militant group’s ideology. But for the most part, they lack the calculus of self-interest that would be required for them to devote troops to the fight. Without those troops, IS has, so far, shown it can continue to exist despite extensive bombing.

The exceptions are Kurdish forces, which have fought IS to the extent compatible with their self-interest in acquiring territory; the Iraqi government, which has some interest in retaking Iraqi cities; and the Syrian regime, which has a self-interest in staying around in some form. Unfortunately, none of these powers has sufficient capacity or in-terest to defeat IS altogether.

That leaves the US and the Euro-pean powers. Ideologically, all these abhor IS. But none (so far) thinks its self-interest suffices to go beyond bombing.

Is this self-interested stance morally superior to going to war out of hatred for IS and what it stands for? Or morally inferior? Both views can plausibly be sustained. Often it seems that morally inspired war is selfless and, therefore, less likely to be undertaken for bad moral reasons. But following self-interest may keep us out of wars that we fight foolishly, mistakenly believing that we can achieve our moral ends.

The upshot is that we must be clear-eyed about why we want to be rid of IS. If our motives are primar-ily moral, we should keep in mind the risks that we will create unan-ticipated harm.

If, however, our motives are self-interested, we should be prepared to admit that we can tolerate IS’s continued existence.

In 10,000 years, when histori-ans of the future try to untangle our motives for war, let’s hope they can at least say that we knew what they were.

Why we fight: Now and 10,000 years ago

These deep questions are raised by the finding of a mass grave from 10,000 years ago by the shores of Kenya’s Lake Turkana, now the ear-liest such site known.

They also resonate in the de-bate about how seriously to engage Islamic State (IS), and whether to employ means of warfare that would actually eliminate the group instead of just contain it. In particular, the fight against IS involves the ques-tion of whether it’s good or right to go to war because the enemy is morally so bad.

Taken together, the battles of 10,000 years ago and today can help us clarify our answers.

The Lake Turkana site reveals about 27 skeletons, which appear to be from people killed in the same attack. (There are 12 complete skel-etons, of which 10 clearly show that the person died violently. The evi-dence for the deaths of the partial skeletons is more circumstantial.)

The grave matters to anthro-pologists because 10,000 years ago, cultivation wasn’t yet practiced any-where near the site. That means the people who died—and those who killed them—were almost certainly hunter-gatherers. Their weapons included clubs, arrows and embed-ded stone blades.

There’s a legitimate debate to be had about whether the attack is evidence of war or of something

less, like a raid. But that question is less interesting than the debate about exactly why the attackers, whoever they were, killed men, women and young children, and left them where they fell.

The archaeologists who exca-vated the site speculate, on the ba-sis of pottery found in the region, that there may have been surplus food stored, and that the attackers may have come to steal it. Another theory is that the goal was to take captives. No adolescent skeletons were found, suggesting that, per-haps, young people were taken as prisoners.

Notice that these ideas assume that some kind of self-interest must’ve been the underlying motive. Of course, we know from recorded history that wars fought for reasons of belief can also involve plunder and the taking of captives. Evidence of these practices isn’t proof of underlying motive.

Could people fighting 10,000 years ago have had ideas capable of motivating action? The answer is unquestionably yes. They were fully evolved Homo sapiens, and had been for many millenniums. Religious icons and cave art date back substantially further in the human past. People who hold be-liefs and make art can fight and kill for reasons they feel and articulate in language.

China’s migrants go home—and stay there

EVERY year, tens of millions of China’s 246 million migrants return home to celebrate the Chinese New Year. It’s the world’s biggest annual migration, and it typically goes off smoothly.

This year, however, something’s amiss.

Could people fighting 10,000 years ago have had ideas ca-pable of motivating action? The answer is unquestionably yes. They were fully evolved Homo sapiens, and had been for many millenniums. Religious icons and cave art date back sub-stantially further in the human past. People who hold beliefs and make art can fight and kill for reasons they feel and ar-ticulate in language. It emerges that these functional, self-inter-est-based explanations reflect a set of disciplinary assumptions about why humans fight.

BLOOMBERGNoah Feldman

BLOOMBERG VIEWAdam Minter

Although the holiday doesn’t start until February 8, millions of workers—especial ly in the construction and electrical-ap-pliance industries—have already returned home due to the country’s slowing economy. For local govern-ments across China, this is raising a tough question: What happens if these laborers don’t go back to work after the holiday?

The concern isn’t a new one. In early 2009, 20 million unemployed migrants returned home for the holidays in the wake of the global fi-nancial crisis, raising fears of social unrest. Labor riots did, in fact, take place. But most of the unemployed appear to have gotten back to work when China’s monster stimulus kicked in later that year.

This time is notably different.

Prospects for a 2009-style stimu-lus are slim. More important, China is on the cusp of a long-term trend of reverse migration back to the coun-tryside. This week, the National Bu-reau of Statistics reported that the migrant population dropped by 5.68 million in 2015—its first decline in about three decades.

Some of that decline is simple demographics, and parallels Chi-na’s rapidly shrinking labor force. But much of it is attributable to a slump in the labor-intensive manufacturing sector and a steady improvement in rural economies. These trends haven’t caught au-thorities completely off-guard: Despite a long-term commitment to urbanization (in 1980 China was 19.6-percent urbanized; today the figure is more than 50 percent), the government has recently di-rected more attention and money to rural-development projects,

ranging from infrastructure im-provement to credit support for the country’s hundreds of millions of farmers. This year, rural per-capita income is expected to exceed 10,000 yuan for the first time, surpassing urban-income growth for the fifth straight year.

But just as economics were never the sole reason for moving to the city, many migrants also have noneconomic motives for moving back home, including a desire to care for aging parents left behind and a hunger for uncontaminated food.

“The migrant workers are rooted in the countryside,” said Yang Tuan, a prominent sociologist at the Chi-na Academy of Social Science, in a September interview. “They have feelings for the land.” She predicted that reverse migration might peak in the next five to 10 years.

On balance, that should be good news. It should help alleviate the

overcrowding in China’s biggest cit-ies and the sharp income disparity between rural and urban areas. Re-turning migrants tend to be more worldly and wealthy than when they left, as well as more entrepreneurial: The number of people starting new businesses in rural China grew 3.1 percent, year over year, in the first half of 2015. In total, about 2 mil-lion migrants have returned home to start businesses. That trend appears to be accelerating: Sichuan Province, China’s leading source of migrant la-bor, reports that more than 40,000 of its returned migrants have at-tempted to start businesses over the past year.

The government could still do more to help, starting with expand-ing access to capital via micro-credit programs (returning migrants don’t attract many bankers) and boosting Internet access in rural areas (less than a third of rural inhabitants are

online). Many returning workers will also be looking for training and jobs—not a start-up opportu-nity. Agriculture, the industry that many of them left behind, is badly in need of modernization, and the government could help by creating agriculturally focused vocational schools that help workers gain entry to China’s nascent but growing agri-business sector. Long-overdue land reform would also allow farmers to finally choose for themselves how to buy, use and sell their small plots, and, thus, unlock the true value of China’s countryside.

Reversing 30 years of demo-graphic trends won’t be easy for Chi-na’s cities or its countryside. But the transition itself is a reminder that decades of reform is finally starting to pay off for some of China’s most economically backward regions.

That’s worth celebrating this Chinese New Year.

In an interview with the B-M, SM Hotels President Elizabeth T. Sy said the company will be focusing on the mid-range market, building more Park Inn by Radisson hotels, because of the “strong de-mand” for such accommodations.

The company just opened its newest Park Inn in the Clark Free-port Zone in Pampanga, a few steps away from SM City Clark. The hotel is a partnership between SM Ho-tels and the Carlson Rezidor Hotel Group, which is headquartered in Minneapolis and Brussels.

“The numbers show there is re-ally a lack of accommodations in the mid-market segment. So we want to focus more on [building] Park Inns, which is more a millennials-minded hotel,” she said.

SM Hotels hopes to break ground for a new Park Inn this year in Metro Manila. While SM Hotels officials were coy about the location of the new hotel, an official of Carlson Hotels said it would be at SM North

Edsa in Quezon City. Speaking with select reporters

on the sidelines of the Clark prop-erty’s launch, Andre de Jong, vice president for operations in South-east Asia and Pacific for Carlson Hotels Asia Pacific, said the com-pany is also looking at Iloilo City and the South Road Properties in Cebu, where SM opened its newest mall, Seaside City, last November.

He also said Carlson is “looking at opportunities, be it resorts, be it Manila,” for its Radisson Blu brand. “Radisson Blu has an excellent reputation in this country because of Radisson Blu Cebu, so yeah, we’re open for business.” For her part, Sy said there was strong demand for the Park Inn brand: “We’re being asked also if we are ready to open in Iloilo…. It has to be in selected malls; we want to stabilize everything, at least know about our segment, then hopefully, roll out faster.” Aside from the Philippines, there

are no other countries in Southeast Asia that host Park Inn hotels. In Vietnam, the Carlson Rezidor Group will be building a Radisson Blu, a re-sort, along Cam Ranh Bay. Meanwhile, SM Hotels Senior Vice President for Operations Peggy Angeles said the company is “easily looking at a 20-percent [net income] growth in 2016, with the coming in of this hotel [Park Inn Clark]. Add in also Conrad Hotel when it starts operating.” Conrad Hotel Manila is SM Hotels’ foray into the luxury

segment, and will be operated in partnership with Hilton Worldwide. The 347-room hotel is scheduled to open by June 2016 at the Mall of Asia (MOA) complex. A report filed with the Philip-pine Stock Exchange by its par-ent unit, SM Prime Holdings Inc., showed that SM Hotels earned an unaudited net income of P226.15 million from January to September 2015, a jump of 234 percent from P67.7 million in the same period in 2014.

Angeles added that Park Inn by Radisson Davao (202 rooms) is run-ning at an average hotel-occupancy rate of 65 percent, but was running about 100 percent last December. “And Radisson Blu [396 rooms]

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2ndFront PageBusinessMirror

www.businessmirror.com.ph

2Tuesday, January 26, 2016

B M. S F. A | Special to the BM

SM Hotels and Conventions Corp. is forecasting a profit of at least P271 million in 2016,

as it expands its reach in the Philip-pines by opening more hotels and convention centers.

SM hotel unit to focus on mid-range market�e numbers

show there is really a lack of accommodations in the mid-market segment. So we want to focus more on [building] Park Inns, which is more a millennials-minded hotel.” —Sy

has been very successful. As you know, they’re running on their fifth year, and they’re running in the high 70 [percent] all year round. It’s pretty good business. The Apec [Asia-Pacific Economic Coopera-tion] summit also helped boost oc-cupancy rates,” she noted.

Park Inn by Radisson Clark is a 154-room hotel that enjoys a prime location, and is only 10 minutes away from the Clark International Airport. It is centrally located in the city near tourist attractions, museums and historical landmarks. The hotel has a 203-square- meter meeting room that can accommodate a maximum of 120 guests. The lobby, in keeping with the “Living Room” design theme of

the hotel, allows guests to social-ize and provides an intimate space for individuals who wish to unwind by reading or surfing the Internet. The hotel has a swimming pool and gym for recreation.

Park Inn by Radisson Clark also offers food lovers a new dining experience through its restaurant called Hues, providing a hip set-ting in which groups can meet over “exciting” food and beverage (F&B) options, Angeles said. She added that this is the first time that SM Hotels has tapped a concessionaire, in this case, the Max’s Group Inc., to handle the F&B outlet for its Park Inn by Radisson Clark. “We will try it out, see if it works, and if it does, maybe apply to our other hotels,” she said. Getting an outside company to handle the F&B reduces operational costs for SM Hotels and ensures that the food re-quirements of guests are adequately met, as this is the expertise of Max’s, she further explained. At present, Park Inn Davao operates its own F&B outlet.

SM Hotels also owns and oper-ates Taal Vista Hotel (261 rooms) in Tagaytay City; the Pico Sands Hotel (154 rooms) in Hamilo Coast; and the SMX Convention Center at the MOA complex, Taguig, Davao and Bacolod. It also operates trade halls in SM Mega-mall and SM City Cebu. The trade halls and convention center total 36,137 sq m of exhibition and conference space.

BusinessMirror January 26, 2016

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