B D C B UDGET Secretary Florencio B. Abad has issued the guide- lines on the utilization of the P19.07-billion Local Government Support Fund (LGSF). Local government units (LGUs) can tap this financial assistance from the national government for their projects, including health, social ser- vices and infrastructure. Under Local Budget Circular 109, LGUs can now propose to get funding for their projects, which will be ap- proved by the Department of Budget and Management and funded by the PESO EXCHANGE RATES n US 46.2700 n JAPAN 0.4148 n UK 66.9110 n HK 5.9661 n CHINA 7.1482 n SINGAPORE 34.0973 n AUSTRALIA 35.1328 n EU 52.1555 n SAUDI ARABIA 12.3387 Source: BSP (21 March 2016 ) A broader look at today’s business www.businessmirror.com.ph n Tuesday, March 22, 2016 Vol. 11 No. 166 P. | | 7 DAYS A WEEK MEDIA PARTNER OF THE YEAR 2015 ENVIRONMENTAL LEADERSHIP AWARD UNITED NATIONS MEDIA AWARD 2008 ANNUAL EXODUS Passengers who will spend the Holy Week in the provinces wait for their ride at the Araneta Bus Terminal in Cubao, Quezon City. ALYSA SALEN In the latest Market Call report, First Metro Investment Corp. (FMIC) and University of Asia and the Pacific (UA&P) Capital Mar- kets Research said growth will be driven by election spending and the government’s infrastructure expenditures. “With the dreaded El Niño ap- pearing to be fairly moderated in January to February, agricultural output may yet turn slightly posi- tive, which, together with robust I NDONESIA detained the crew of a Chinese boat suspected of illegally fishing in its waters, after a chase involving a Chinese coast guard vessel. The government submitted a pro- test to China’s Chargé d’Affaires Sun Weide in Jakarta over the incident in Indonesia’s economic zone near the Natuna islands, Foreign Minis- ter Retno Marsudi said, according to state news agency Antara. Earlier, Ministry Spokesman Arrmanatha Nasir said a Chinese coast guard vessel had entered the melee, colliding with the fishing boat as it was being towed by an Indonesian patrol ship. It was unclear how many fishermen were on the boat and are now being held. “We are concerned, but I can’t say much more before all the facts are verified,” Nasir said. Under President Joko Widodo, the government has taken a more assertive approach to foreign policy; stepping up control of the borders of the world’s largest archipelago; devel- oping its coast guard; and blowing up vessels found illegally fishing in its waters. Indonesia is also deploy- ing warships in the gas-rich waters C A INSIDE EASY VICTORIES VIETNAM ECONOMY AT RISK SANS REFORMS—IMF BusinessMirror [email protected] Editor: Max V. de Leon • Tuesday, March 22, 2016 A5 Asean Tuesday 790B baht $70B Vietnam economy at risk sans reforms–IMF V IETNAM risks being vulner- able to external shocks if it doesn’t push through with re- forms to strengthen its banking sys- tem and restructure state businesses, according to International Monetary Fund (IMF) chief Christine Lagarde. The Southeast Asian nation isn’t in a position to withstand economic blows from tightening of monetary policies elsewhere, a deep and pro- longed drop in commodity prices and a slowing China without reforms, she said in a March 18 interview in Ho Chi Minh City. “The risk is that from being slightly vulnerable, Viet- nam could become very vulnerable to external shocks,” she said. “It would expose the Vietnamese economy, and that would not be good for the Vietnamese population.” Vietnam’s integration with the global economy has driven growth and reduced poverty. The economy is forecast to grow at 6.6 percent this year, according to Bloomberg sur- veys, while Prime Minister Nguyen Tan Dung has proposed raising the country’s 2016 economic expansion target to 7 percent, from 6.7 percent. The nation’s poverty rate has dropped to 13.5 percent, from 60 percent in 1993, and its economic growth is expected to be “solid” at more than 6 percent this year, La- garde said in a visit to the country last week, during which she met with the country’s top leaders. Viet- nam, which is in the process of a once-in-five-years political transi- tion, now has one of the world’s most open economies, she said. The risk is that from being slightly vul- nerable, Vietnam could become very vulnerable to ex- ternal shocks.” —L Thailand’s domestic tourism revenue in 2015 Estimated online sales across Asean by 2010, from the current $6 billion, according to a Bain & Co. and Google Inc. report development, she said. Vietnam also needs to make greater use of exchange-rate flex- ibility to soften the blows of overseas economic shocks and build external reserves, she said. Reforming the na- tion’s state-owned companies and re- solving bad debt at banks will offset the aging of its working-age popula- tion that could be a future drag on growth, according to Lagarde. Corporate governance “WE believe the banking system needs to be made stronger, better and more capitalized with less stressed assets in its balance sheets, so the banks can actually fuel the economy,” Lagarde said. State-owned enterprises need better governance and to refocus on their core businesses, she said. The country is also at risk with public debt at about 60 percent of GDP and with one of the world’s fastest-aging societies and a work- ing-age population that is beginning to decline. “When you have the combination of high debt and slightly declining working-age population, you need to be very careful with your mac- roeconomic stability,” she said in the interview. “You need to be very careful with the revenue you gener- ate and how you spend it.” PM’s fate hangs VIETNAMESE legislators will vote in the coming weeks on whether to dismiss Dung two months after he failed in his bid to become the Com- munist Party’s chief. The National Assembly previ- ously had been scheduled to meet during the summer to complete the nation’s once-in-five-year political transition. Lawmakers will also vote L IPPO Group, the Indonesian conglomerate founded by billionaire tycoon Mochtar Riady, will partner with GrabTaxi Holdings Pte. for e-commerce de- liveries in Southeast Asia’s largest economy. The founder’s grandson, John Ri- ady, is spearheading Lippo Group’s foray into e-commerce with a $500 million investment in Matahari- Mall, an online version of its Ma- tahari department store chain. Grab, a regional ride-hailing com- pany, will help transport and deliver goods to bolster MahatariMall’s services, the companies said in a statement on Monday. The partnership shows how local companies, familiar with consumer preferences, regulations and infra- structure challenges, are trying to tailor services to stay ahead of Indonesia’s Lippo Group partners with GrabTaxi to speed up distribution VIETNAMESE Communist Party General Secretary Nguyen Phu Trong (left, front), President Truong Tan Sang (right, front), Prime Minister Nguyen Tan Dung (center, second row) and Chairman of the National Assembly Nguyen Sinh Hung (right, second row) pay tribute to late President Ho Chi Minh at his mausoleum in Hanoi on Monday. The National Assembly is expected to vote early next month to remove Sang, Dung and Hung after they were not elected to the all-powerful Politburo in the party’s congress in January. The assembly is also expected to elect the country’s new leaders. Remarkable potential “VIETNAM has done very well—to have the ability to maintain mac- roeconomic stability in an environ- ment, which is challenging, because the rest of the world is not growing at the pace, and the potential we would like to see is quite remarkable,” La- garde said in the interview. “It has done very well in terms of reducing poverty and it has not increased inequality, which often comes with growth.” Still, the nation’s eco- nomic expansion since 2008 has been slower than the two preceding decades and it has failed to match per-capita-income growth that the region’s most successful econo- mies experienced similar stages in T HE Tourism Authority of Thailand (TAT) has set a challenging new target for domestic tourism revenue of 900 billion baht this year, up from 790 billion baht in 2015. This goal is an increase from its 850-billion-baht forecast made earlier this year, in line with the government’s policy to promote do- mestic tourism and generate greater income for local communities. The additional revenue is expect- ed to come from daily merchants crossing the border from Lao PDR, Cambodia and Myanmar for both business and leisure. Moreover, the TAT’s planned tourism campaigns will be more aggressive. TAT governor Yuthasak Supa- sorn called the new domestic tour- ism revenue goal “a tough target” at a time when the economy is slowing. The agency previously made 900 billion baht the goal for 2017. “The government is promoting service businesses among farming communities to help them generate income when crop prices are low and with a water shortage highly likely this summer,” Yuthasak said. The Interior Ministry recently approved a 60-billion-baht budget for local administration organi- zations to develop tourism infra- with neighboring countries, such as Lao PDR, Cambodia and Myanmar. It is awaiting government approval for the 780-million-baht special budget for its Quick Win tourism campaign and four big events to lift domestic tourism. For international markets, Yuthasak said the TAT is not worried about inbound tourism this year thanks to the sharp rise of foreign tourist arrivals. The Tourism and Sports Ministry projected foreign tourist arrivals to Thailand in the first quarter this year of 8.94 million, up 14.3 per- cent year-on-year. Revenue from in- bound tourism is projected to grow 18.2 percent to 660 billion baht in the first quarter. Arrivals from China are expected to rise 25.4 percent to 2.51 million visitors, with arrivals from Europe years. The rail network currently stretches 4,070 km. He was speak- ing at a seminar and exhibition on rail component production at the Airport Rail Link’s Makkasan sta- tion on Wednesday. He said the government is trying to create a connectivity network for all modes of transportation. Transport Minister Arkhom Termpittayapaisith said the minis- try has a plan to transform the coun- try into a major transport hub for Asean and the Mekong subregion, as well as a transit route linking the Asia Pacific with South Asia, Africa and Europe. eight years, a similar level to other advanced nations. Thailand crafting aggressive domestic tourism campaign on dismissing President Truong Tan Sang and National Assembly Chair- man Nguyen Sinh Hung during meetings to be held from March 31 to April 12, Nguyen Hanh Phuc, gen- eral secretary of National Assembly, said at a briefing in Hanoi. The move, being characterized as procedural by legislators, is unusual. “It’s pretty rare, but did happen twice in the past, when the time period between the Party Congress and the election to form the new Na- tional Assembly was too long,” Cao Sy Kiem, a National Assembly member, said by telephone from Hanoi. “This is to make sure the process of hand- ing over the jobs will be smoothly done. It also make more sense as the prime minister is no longer a Polit- buro member now.” ‘Lame duck’ A DISMISSAL will allow Dung, who wielded significant power, to move on to the next stage in his career and allow the government to avoid an extended period of inaction before the new prime minister and other leaders are appointed. “For a Vietnamese leader, re- spect is very important and you can only govern if you have respect,” said Vu Tu Thanh, chief Vietnam representative of the US-Asean Business Council. “If you feel people have their deference and respect divided between you and the in- coming guy, you want to get out of there and focus on your future. He is a lame duck.” Current Communist Party Gen- eral Secretary Nguyen Phu Trong was chosen by delegates to a second term in January over Dung. The par- liament will also vote to elect new leaders to take the country’s three top positions, Phuc said. Bloomberg News foreign rivals as competition heats up. Japanese e-commerce company Rakuten Inc. closed down its Indo- nesian unit as of March 1, while China’s JD.com Inc. has recently set up shop in Indonesia. “Speed is really important in this business,” said Ridzki Kra- madibrata, managing director of Grab Indonesia. “You need to be able to do multiple things at the same time, because if you can’t do that, the market will outgrow you and you will lose your opportunity.” Rising incomes MATAHARIMALL’S site allows cus- tomers to buy on the Web and pick up items from Lippo’s stores. Its ri- val Tokopedia, which is backed by Japan’s SoftBank Group Corp. and Sequoia Capital, has already formed a similar alliance with Go-Jek, a motorcycle-taxi-booking compa- ny, to deliver purchased items to customers. “Our combined knowledge of the Indonesian market will help us build the most effective online- to-offline experience—to ensure that online shoppers anywhere in Indonesia can receive or collect their purchases easily,” John Riady, a Lippo Group director, said in the statement. Grab’s alliance with Lippo also underscores its aggressive market- share acquisition strategy in In- donesia, where it competes with Uber Technologies Inc. and Go-Jek. Grab’s private car-hailing service grew 30 percent in Indonesia in Feb- ruary, according to the statement. It has more than 50 percent of the C1 | T, M22, 2016 [email protected] [email protected] Editor: Jun Lomibao Asst. Editor: Joel Orellana Sports BusinessMirror B B H e Associated Press I NDIAN WELLS, California—Novak Djokovic and Victoria Azarenka rolled to easy victories in the BNP Paribas Open on Sunday, with the top-ranked Serb collecting his record fifth title and Azarenka winning for the second time to get back into the world’s top 10. Djokovic beat Milos Raonic, 6-2, 6-0, to improve his match record to 22-1 this year. It was the Serb’s third consecutive title in the California desert, breaking a tie with four-time champion Roger Federer, who lost to Djokovic the past two years in the final and skipped this year because of a knee injury. “I’m just glad to be able to raise the level of my game as the tournament progresses, and that’s something that I have been doing in the last two years, particularly on the big events,” Djokovic said. Azarenka defeated error-prone Serena Williams, 6-4, 6-4. Azarenka’s victory and Williams’s return to the final for the first time since 2001, when a hostile crowd triggered her 14-year boycott, was overshadowed by comments from tournament director Raymond Moore. Earlier Sunday, he criticized the Women’s Tennis Association (WTA) Tour and its players, saying they “ride on the coattails of the men” while describing the women as “physically attractive and competitively attractive.” Williams objected, saying, “Those remarks are very much mistaken and very, very, very inaccurate.” Azarenka also expressed disappointment. Djokovic and Azarenka each earned $1.02 million. Djokovic needed an hour and 17 minutes to dispatch Raonic, whose big serve got broken five times. The 25-year-old Canadian served just four aces and had 27 unforced errors. His first serve averaged 128 mph—much faster than Djokovic’s 111 mph—but he connected on only 55 percent. The Serb landed 68 percent of his first serves and was never broken. “He’s the best returner probably of all time,” Raonic said. Raonic was bothered by an injury shortly after the match began, although afterward he wasn’t sure what was wrong. He was playing his first event since a thigh injury in the Australian Open semis in January. “I don’t think it affected my effort,” he said. “I thought he played much better than I did.” Clearly the crowd favorite, Williams gave fans little to cheer about on an unseasonable 91-degree (32 C) day while making 33 unforced errors. After getting broken to trail 3-0 in the second set, Williams returned to her seat and smashed her racket. Trailing 5-1, Williams won three straight games and held two break points on Azarenka’s serve in the last game. But Williams ended the match with three straight errors. “Just unexpected nerves maybe. I definitely didn’t expect to be on that stage again,” said Williams, who was back at Indian Wells after ending her 14-year boycott last year. It was Azarenka’s first victory over the top-ranked Williams since the Cincinnati final in August 2013. She will move up seven spots to No. 8 in the rankings released on Monday, her first time back in the top 10 since August 2014. Azarenka, who won here in 2012, hit just 10 winners and had 20 unforced errors in the two-hour match. She connected on 60 percent of her first serves and broke Williams’s serve three times. Williams converted just one- of-12 break chances. “I have to go for it,” Azarenka said. “She’s not a type of player that if you’re going to play safe she’s going to give it to you or she’s going to miss. You really have to go out there and take away because there is nothing coming easy.” The crowd, including Queen Latifah, was eager to support Williams. One fan held up a sign reading, “Go Serena. We straight outta Compton,” in a nod to the gang-infested Los Angeles suburb where the Williams sisters learned to play tennis. Williams was bidding to become the first woman to win three titles at Indian Wells, where she won in 1999 and 2001. After getting booed heavily while beating Kim Clijsters for her last title here, she vowed never to return. That year the Williams sisters were supposed to meet in a semifinal, but Venus withdrew shortly before the match with a knee injury. The crowd reacted harshly and their father Richard said he heard racial taunts. “Obviously the last time I was there was probably the worst moment of my whole career. Not probably. Sure,” Williams said. “To be back out there, which I never thought I would be, was really different and special. I was overwhelmed with emotions and nerves.” Williams’s low-key persona was in direct contrast to her usual fist-pumping and screams of “Come on!” She hit just 22 winners. Azarenka and Williams met for the 21st time in their careers, with Williams owning a 17-4 edge. The only player she has faced more in her career is her older sister, who watched grim-faced from a box after losing early in her return to Indian Wells for the first time since 2001. “It was so great for our sport to see them both here,” Azarenka said. Williams was warmly welcomed back last year only to withdraw with a knee injury before her semifinal. She got emotional while accepting the runner-up trophy, tears welling in her eyes, after tournament officials thanked her and Venus for ending their boycotts. “Thank you so much for the cheers,” Williams said. “I can’t tell you how much it means to me.” Williams playfully stuck out her tongue as she walked past Azarenka posing with the winner’s crystal trophy on her way off the court. Victoria Azarenka’s victory and Serena Williams’s return to the final for the first time since 2001, when a hostile crowd triggered her 14-year boycott, was overshadowed by comments from tournament director Raymond Moore. CHAMPIONS! The National University (NU) Pep Squad retains the National Cheerleading Championship NOVAK DJOKOVIC improves his match record to 22-1 this year. AP SPORTS C1 ASEAN A5 LIFE D1 C A Indonesia detains Chinese fishermen after SCS chase Above-6.5% growth seen in Q1 on polls, infra binge U.S. RIG COUNT RISES AFTER 3 MOS OF DROP AMID GLUT Additional LGU fund now ready O IL fell for a sec- ond day, extend- ing declines from a three-month high, as the number of drill rigs active in the US rose for the first time in three months amid a global glut. Futures slid as much as 1.5 percent in New York, after decreasing 1.9 percent on Friday. Drillers put one rig back to work last week, marking the first addition since late last year, according to data from Baker Hughes Inc. Ecuador will propose a cut to output at a meeting next month of producers from within and outside the Organization of the Petro- leum Exporting Countries (Opec) to help boost prices, according to President Ra- fael Correa. Energy compa- nies led declines on the MSCI Asia Pacific Index. “There is a bit of a correc- tion after the spike above $40, because the market is still oversupplied and de- mand is sluggish, although it’s better than what it was,” Evan Lucas, a mar- ket strategist at IG Ltd. in Melbourne, said by phone. “An average of around $35 a barrel is likely in the second quarter. There are signs that the supply side is feeling the pinch and have been forced to act.” Oil has recouped its loss- es this year, after slump- ing to a 12-year low last month on speculation stronger demand and fall- ing US output will ease a surplus. Hedge funds and other speculators in- creased their net-long po- sition in West Texas Inter- mediate (WTI) futures and options by 17 percent in the week ended March 15 to the highest since June, US Commodity Futures S “U.S. ,” A C A It is very crystal clear that Natuna belongs to Indonesia.” —M B C U. O D ESPITE El Niño and weak global demand that can affect agriculture and the country’s export earnings, a local think tank believes that first-quarter GDP growth will still be above 6.5 percent this year. We are expecting a third con- secutive quarter of above-6 percent GDP growth.” —M C ₧19.07B ZERO-COST WAYS TO MAKE YOUR HOME FEEL FRESH Funds that local governments can tap under the 2016 LGSF LGSF in the 2016 General Appropria- tions Act. Abad’s circular also enumerated the projects that may be proposed for funding under the LGSF. For projects relating to health, financial assistance may be given to indigent patients, ei- ther confined or outpatients, and may also include professional fees. For social services, financial as- sistance may also be given to indi- gent families through assistance in medical bills, burial assistance, transportation subsidies, food sub- sidies, cash-for-work programs and educational subsidies. For climate-change adaptation programs, an LGU may propose to buy heavy-duty rescue vehicles. Public infrastructure projects may also be proposed to construct or re- pair local roads and bridges, public markets, slaughterhous- es, multi-purpose buildings,
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B D C
BUDGET Secretary Florencio B. Abad has issued the guide-lines on the utilization of the
P19.07-billion Local Government Support Fund (LGSF).
Local government units (LGUs) can tap this financial assistance from the national government for their projects, including health, social ser-vices and infrastructure. Under Local Budget Circular 109, LGUs can now propose to get funding for their projects, which will be ap-proved by the Department of Budget and Management and funded by the
PESO EXCHANGE RATES nUS 46.2700 nJAPAN 0.4148 nUK 66.9110 n HK 5.9661 n CHINA 7.1482 n SINGAPORE 34.0973 n AUSTRALIA 35.1328 n EU 52.1555 n SAUDI ARABIA 12.3387 Source: BSP (21 March 2016 )
A broader look at today’s businessBusinessMirrorBusinessMirror
www.businessmirror.com.ph nTuesday, March 22, 2016 Vol. 11 No. 166 P. | | 7 DAYS A WEEK
MEDIA PARTNER OF THE YEAR2015 ENVIRONMENTAL
LEADERSHIP AWARD
UNITED NATIONSMEDIA AWARD 2008
ANNUAL EXODUS Passengers who will spend the Holy Week in the provinces wait for their ride at the Araneta Bus Terminal in Cubao, Quezon City. ALYSA SALEN
In the latest Market Call report, First Metro Investment Corp. (FMIC) and University of Asia and the Pacific (UA&P) Capital Mar-kets Research said growth will be driven by election spending and the government’s infrastructure expenditures. “With the dreaded El Niño ap-pearing to be fairly moderated in January to February, agricultural output may yet turn slightly posi-tive, which, together with robust
INDONESIA detained the crew of a Chinese boat suspected of illegally fishing in its waters,
after a chase involving a Chinese coast guard vessel.
The government submitted a pro-test to China’s Chargé d’Affaires Sun Weide in Jakarta over the incident in Indonesia’s economic zone near the Natuna islands, Foreign Minis-ter Retno Marsudi said, according
to state news agency Antara.Earlier, Ministry Spokesman
Arrmanatha Nasir said a Chinese coast guard vessel had entered the melee, colliding with the fishing boat as it was being towed by an Indonesian patrol ship. It was unclear how many fishermen were on the boat and are now being held.
“We are concerned, but I can’t say much more before all the facts are
verified,” Nasir said.Under President Joko Widodo,
the government has taken a more assertive approach to foreign policy; stepping up control of the borders of the world’s largest archipelago; devel-oping its coast guard; and blowing up vessels found illegally fishing in its waters. Indonesia is also deploy-ing warships in the gas-rich waters
C A
INSIDE
EASYVICTORIES
VIETNAMECONOMY AT RISK SANS REFORMS—IMF
[email protected] Editor: Max V. de Leon • Tuesday, March 22, 2016 A5
AseanTuesday
790B baht$70B
Vietnam economy at risk sans reforms–IMFVIETNAM risks being vulner-
able to external shocks if it doesn’t push through with re-
forms to strengthen its banking sys-tem and restructure state businesses, according to International Monetary Fund (IMF) chief Christine Lagarde.
The Southeast Asian nation isn’t in a position to withstand economic blows from tightening of monetary policies elsewhere, a deep and pro-longed drop in commodity prices and a slowing China without reforms, she said in a March 18 interview in Ho Chi Minh City. “The risk is that from being slightly vulnerable, Viet-nam could become very vulnerable to external shocks,” she said. “It would expose the Vietnamese economy, and that would not be good for the Vietnamese population.”
Vietnam’s integration with the global economy has driven growth and reduced poverty. The economy is forecast to grow at 6.6 percent this year, according to Bloomberg sur-veys, while Prime Minister Nguyen Tan Dung has proposed raising the country’s 2016 economic expansion target to 7 percent, from 6.7 percent.
The nation’s poverty rate has dropped to 13.5 percent, from 60 percent in 1993, and its economic growth is expected to be “solid” at more than 6 percent this year, La-garde said in a visit to the country last week, during which she met with the country’s top leaders. Viet-nam, which is in the process of a once-in-five-years political transi-tion, now has one of the world’s most open economies, she said.
The risk is that from
being slightly vul-nerable, Vietnam could become very vulnerable to ex-ternal shocks.”
—L
Thailand’s domestic tourism revenue in 2015
Estimated online sales across Asean by 2010, from the current $6 billion, according to a Bain
& Co. and Google Inc. report
development, she said.Vietnam also needs to make
greater use of exchange-rate flex-ibility to soften the blows of overseas economic shocks and build external reserves, she said. Reforming the na-tion’s state-owned companies and re-solving bad debt at banks will offset the aging of its working-age popula-tion that could be a future drag on growth, according to Lagarde.
Corporate governance“WE believe the banking system needs to be made stronger, better and more capitalized with less stressed
assets in its balance sheets, so the banks can actually fuel the economy,” Lagarde said.
State-owned enterprises need better governance and to refocus on their core businesses, she said.
The country is also at risk with public debt at about 60 percent of GDP and with one of the world’s fastest-aging societies and a work-ing-age population that is beginning to decline.
“When you have the combination of high debt and slightly declining working-age population, you need to be very careful with your mac-
roeconomic stability,” she said in the interview. “You need to be very careful with the revenue you gener-ate and how you spend it.”
PM’s fate hangsVIETNAMESE legislators will vote in the coming weeks on whether to dismiss Dung two months after he failed in his bid to become the Com-munist Party’s chief.
The National Assembly previ-ously had been scheduled to meet during the summer to complete the nation’s once-in-five-year political transition. Lawmakers will also vote
LIPPO Group, the Indonesian conglomerate founded by billionaire tycoon Mochtar
Riady, will partner with GrabTaxi Holdings Pte. for e-commerce de-liveries in Southeast Asia’s largest economy.
The founder’s grandson, John Ri-ady, is spearheading Lippo Group’s foray into e-commerce with a $500 million investment in Matahari-Mall, an online version of its Ma-tahari department store chain. Grab, a regional ride-hailing com-pany, will help transport and deliver goods to bolster MahatariMall’s services, the companies said in a statement on Monday.
The partnership shows how local companies, familiar with consumer preferences, regulations and infra-structure challenges, are trying to tailor services to stay ahead of
Indonesia’s Lippo Group partners with GrabTaxi to speed up distribution
VIETNAMESE Communist Party General Secretary Nguyen Phu Trong (left, front), President Truong Tan Sang (right, front), Prime Minister Nguyen Tan Dung (center, second row) and Chairman of the National Assembly Nguyen Sinh Hung (right, second row) pay tribute to late President Ho Chi Minh at his mausoleum in Hanoi on Monday. The National Assembly is expected to vote early next month to remove Sang, Dung and Hung after they were not elected to the all-powerful Politburo in the party’s congress in January. The assembly is also expected to elect the country’s new leaders. AP
Remarkable potential“VIETNAM has done very well—to have the ability to maintain mac-roeconomic stability in an environ-ment, which is challenging, because the rest of the world is not growing at the pace, and the potential we would like to see is quite remarkable,” La-garde said in the interview. “It has done very well in terms of reducing poverty and it has not increased inequality, which often comes with growth.” Still, the nation’s eco-nomic expansion since 2008 has been slower than the two preceding decades and it has failed to match per-capita-income growth that the region’s most successful econo-mies experienced similar stages in
THE Tourism Authority of Thailand (TAT) has set a challenging new target for
domestic tourism revenue of 900 billion baht this year, up from 790 billion baht in 2015.
This goal is an increase from its 850-billion-baht forecast made earlier this year, in line with the government’s policy to promote do-mestic tourism and generate greater income for local communities.
The additional revenue is expect-ed to come from daily merchants crossing the border from Lao PDR, Cambodia and Myanmar for both business and leisure. Moreover, the TAT’s planned tourism campaigns will be more aggressive.
TAT governor Yuthasak Supa-sorn called the new domestic tour-ism revenue goal “a tough target” at a time when the economy is slowing.
The agency previously made 900 billion baht the goal for 2017.
“The government is promoting service businesses among farming communities to help them generate income when crop prices are low and with a water shortage highly likely this summer,” Yuthasak said.
The Interior Ministry recently approved a 60-billion-baht budget for local administration organi-zations to develop tourism infra-structures and products in their communities.
“The budget will be used to de-velop the supply side of tourism,” he said. “The TAT will take a role in raising demand through aggres-sive campaigns the rest of the year.”
Some major campaigns are Dis-cover Thainess 2016, 12 Hidden Gems and Wan-Tam-Ma-Da-Na-Tiew (a weekday travel promotion), and Yuthasak urged further market-ing of these campaigns.
The TAT also plans to promote new tourism routes connecting popular destinations in Thailand
with neighboring countries, such as Lao PDR, Cambodia and Myanmar. It is awaiting government approval for the 780-million-baht special budget for its Quick Win tourism campaign and four big events to lift domestic tourism.
For international markets, Yuthasak said the TAT is not worried about inbound tourism this year thanks to the sharp rise of foreign tourist arrivals.
The Tourism and Sports Ministry projected foreign tourist arrivals to Thailand in the first quarter this year of 8.94 million, up 14.3 per-cent year-on-year. Revenue from in-bound tourism is projected to grow 18.2 percent to 660 billion baht in the first quarter.
Arrivals from China are expected to rise 25.4 percent to 2.51 million visitors, with arrivals from Europe gaining 8.3 percent to 2.09 million, and Asean visitors increasing 5.7 percent to 1.89 million.
For domestic tourism, the min-istry expected income to grow 6.9 percent to 210 billion baht in the first quarter.
The government aims to expand the country’s total rail network to 7,000 kilometers by 2022 to reduce logistics costs and take advantage of the country’s geographic position.
Prime Minister Prayut Chan-o-cha said the expansion is needed as the country has failed to make headway in rail development for
years. The rail network currently stretches 4,070 km. He was speak-ing at a seminar and exhibition on rail component production at the Airport Rail Link’s Makkasan sta-tion on Wednesday. He said the government is trying to create a connectivity network for all modes of transportation.
Transport Minister Arkhom Termpittayapaisith said the minis-try has a plan to transform the coun-try into a major transport hub for Asean and the Mekong subregion, as well as a transit route linking the Asia Pacific with South Asia, Africa and Europe.
The move is included in the na-tional transport investment plan from 2015 to 2022 and the national logistics strategic plan from 2013 to 2017. “The Transport Ministry wants a rail network offering a low-cost service. It is currently second in affordability after water transport,” said Arkhom, noting rail shipments account for only 2 percent of all transport volume and the ministry aims to push this up to 5 percent by 2022.
The move would help reduce lo-gistics costs from 14 percent of GDP to 10 percent to 12 percent within eight years, a similar level to other advanced nations.
After the rail network increases to 7,000 km, factories could be set up to produce train components, signal systems and carriages, Arkhom said.
He said the ministry will also work with the Science and Tech-nology Ministry and the Industry Ministry to develop rail compo-nents, human resources and signal systems by adopting technologies from abroad.
Land around the rail stations and on both sides of the rail tracks will be commercially developed to supple-ment income for financing the rail operations, the minister said. MCT
Thailand crafting aggressive domestic tourism campaign
on dismissing President Truong Tan Sang and National Assembly Chair-man Nguyen Sinh Hung during meetings to be held from March 31 to April 12, Nguyen Hanh Phuc, gen-eral secretary of National Assembly, said at a briefing in Hanoi.
The move, being characterized as procedural by legislators, is unusual.
“It’s pretty rare, but did happen twice in the past, when the time period between the Party Congress and the election to form the new Na-tional Assembly was too long,” Cao Sy Kiem, a National Assembly member, said by telephone from Hanoi. “This is to make sure the process of hand-ing over the jobs will be smoothly done. It also make more sense as the prime minister is no longer a Polit-buro member now.”
‘Lame duck’A DISMISSAL will allow Dung, who wielded significant power, to move on to the next stage in his career and allow the government to avoid an extended period of inaction before the new prime minister and other leaders are appointed.
“For a Vietnamese leader, re-spect is very important and you can only govern if you have respect,” said Vu Tu Thanh, chief Vietnam representative of the US-Asean Business Council. “If you feel people have their deference and respect divided between you and the in-coming guy, you want to get out of there and focus on your future. He is a lame duck.”
Current Communist Party Gen-eral Secretary Nguyen Phu Trong was chosen by delegates to a second term in January over Dung. The par-liament will also vote to elect new leaders to take the country’s three top positions, Phuc said.
Bloomberg News
foreign rivals as competition heats up. Japanese e-commerce company Rakuten Inc. closed down its Indo-nesian unit as of March 1, while China’s JD.com Inc. has recently set up shop in Indonesia.
“Speed is really important in
this business,” said Ridzki Kra-madibrata, managing director of Grab Indonesia. “You need to be able to do multiple things at the same time, because if you can’t do that, the market will outgrow you and you will lose your opportunity.”
Rising incomesMATAHARIMALL’S site allows cus-tomers to buy on the Web and pick up items from Lippo’s stores. Its ri-val Tokopedia, which is backed by Japan’s SoftBank Group Corp. and Sequoia Capital, has already formed a similar alliance with Go-Jek, a motorcycle-taxi-booking compa-ny, to deliver purchased items to customers.
“Our combined knowledge of the Indonesian market will help us build the most effective online-to-offline experience—to ensure that online shoppers anywhere in Indonesia can receive or collect their purchases easily,” John Riady, a Lippo Group director, said in the statement.
Grab’s alliance with Lippo also underscores its aggressive market-share acquisition strategy in In-donesia, where it competes with Uber Technologies Inc. and Go-Jek. Grab’s private car-hailing service grew 30 percent in Indonesia in Feb-ruary, according to the statement. It has more than 50 percent of the country’s motorcycle taxi market in March, it said.
Technology startups are trying to capitalize on rising incomes and growing mobile-phone use in Southeast Asia, where 250 million consumers are now con-nected via smartphone and 100 million engage in online trans-actions, according to a report by Bain & Co. and Google Inc. released last week.
The report predicts online sales across Southeast Asia to surge to $70 billion by 2020, from $6 bil-lion now. Bloomberg News
BISHOP IN JAKARTA Australian Foreign Minister Julie Bishop (right) is greeted by her Indonesian counterpart Retno Marsudi during their meeting in Jakarta on Monday. AP
C1 | TUESDAY, MARCH 22, [email protected]
[email protected]: Jun Lomibao
Asst. Editor: Joel Orellana
[email protected] | TUESDAY, MARCH 22, 2016
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EASYEASYEASYEASYEASYEASYVICTORIESVICTORIESVICTORIESVICTORIESVICTORIESVICTORIES
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B B H�e Associated Press
INDIAN WELLS, California—Novak Djokovic and Victoria Azarenka rolled to easy victories in the BNP Paribas Open on Sunday, with the top-ranked Serb collecting his record �fth title and Azarenka winning for the second time to get back into the
world’s top 10. Djokovic beat Milos Raonic, 6-2, 6-0, to improve his match record to 22-1 this year. It was the Serb’s third consecutive title in the California desert, breaking a tie with four-time champion Roger Federer, who lost to Djokovic the past two years in the �nal and skipped this year because of a knee injury. “I’m just glad to be able to raise the level of my game as the tournament progresses, and that’s something that I have been doing in the last two years, particularly on the big events,” Djokovic said. Azarenka defeated error-prone Serena Williams, 6-4, 6-4. Azarenka’s victory and Williams’s return to the �nal for the �rst time since 2001, when a hostile crowd triggered her 14-year boycott, was overshadowed by comments from tournament director Raymond Moore. Earlier Sunday, he criticized the Women’s Tennis Association (WTA) Tour and its players, saying they “ride on the coattails of the men” while describing the women as “physically attractive and competitively attractive.” Williams objected, saying, “Those remarks are very much mistaken and very, very, very inaccurate.” Azarenka also expressed disappointment. Djokovic and Azarenka each earned $1.02 million. Djokovic needed an hour and 17 minutes to dispatch Raonic, whose
big serve got broken five times. The 25-year-old Canadian served just four aces and had 27 unforced errors. His first serve averaged 128 mph—much faster than Djokovic’s 111 mph—but he connected on only 55 percent. The Serb landed 68 percent of his first serves and was never broken. “He’s the best returner probably of all time,” Raonic said. Raonic was bothered by an injury shortly after the match began, although afterward he wasn’t sure what was wrong. He was playing his �rst event since a thigh injury in the Australian Open semis in January. “I don’t think it a�ected my e�ort,” he said. “I thought he played much better than I did.” Clearly the crowd favorite, Williams gave fans little to cheer about on an unseasonable 91-degree (32 oC) day while making 33 unforced errors. After getting broken to trail 3-0 in the second set, Williams returned to her seat and smashed her racket. Trailing 5-1, Williams won three straight games and held two break points on Azarenka’s serve
in the last game. But Williams ended the match with three
straight errors. “Just unexpected nerves
maybe. I de�nitely didn’t expect to be on that
stage again,” said Williams, who was
back at Indian Wells after ending her 14-year
boycott last year. It was Azarenka’s �rst victory over
the top-ranked Williams since the Cincinnati �nal in August 2013. She will move up seven spots to No. 8 in the rankings released on Monday, her �rst time back in the top 10 since
August 2014. Azarenka, who won here in 2012, hit just 10 winners and had
20 unforced errors in the two-hour match. She connected on 60 percent of
her �rst serves and broke Williams’s serve three times. Williams converted just one-of-12 break chances.
“I have to go for it,” Azarenka said. “She’s not a type of player that
if you’re going to play safe she’s going to give it to
you or she’s going to miss. You really have to go out there and take
away because there is
nothing coming
easy.”
The crowd, including Queen Latifah, was eager to support Williams. One fan held up a sign reading, “Go Serena. We straight outta Compton,” in a nod to the gang-infested Los Angeles suburb where the Williams sisters learned to play tennis. Williams was bidding to become the �rst woman to win three titles at Indian Wells, where she won in 1999 and 2001. After getting booed heavily while beating Kim Clijsters for her last title here, she vowed never to return. That year the Williams sisters were supposed to meet in a semi�nal, but Venus withdrew shortly before the match with a knee injury. The crowd reacted harshly and their father Richard said he heard racial taunts. “Obviously the last time I was there was probably the worst moment of my whole career. Not probably. Sure,” Williams said. “To be back out there, which I never thought I would be, was really di�erent and special. I was overwhelmed with emotions and nerves.” Williams’s low-key persona was in direct contrast to her usual �st-pumping and screams of “Come on!” She hit just 22 winners. Azarenka and Williams met for the 21st time in their careers, with Williams owning a 17-4 edge. The only player she has faced more in her career is her older sister, who watched grim-faced from a box after losing early in her return to Indian Wells for the �rst time since 2001. “It was so great for our sport to see them both here,” Azarenka said. Williams was warmly welcomed back last year only to withdraw with a knee injury before her semi�nal. She got emotional while accepting the runner-up trophy, tears welling in her eyes, after tournament o�cials thanked her and Venus for ending their boycotts. “Thank you so much for the cheers,” Williams said. “I can’t tell you how much it means to me.” Williams playfully stuck out her tongue as she walked
past Azarenka posing with the winner’s crystal trophy on her way o� the court.
Victoria Azarenka’s victory and Serena Williams’s return to the �nal for the �rst time since 2001, when a hostile crowd triggered her 14-year boycott, was overshadowed by comments from tournament director Raymond Moore.
CHAMPIONS! The National
University (NU) Pep Squad retains
the National Cheerleading
Championship on Sunday at
the MOA Arena in Pasay City. NU garnered a total
of 340.5 points to bag its third
NCC title.
NOVAK DJOKOVIC improves his
match record to 22-1 this year. AP
SPORTS C1
ASEAN A5
LIFE D1
C A
Indonesia detains Chinese fishermen after SCS chase
Above-6.5% growth seen in Q1 on polls, infra binge
U.S. RIG COUNT RISES AFTER 3 MOS OF DROP AMID GLUT
Additional LGU fund now ready
OIL fell for a sec-ond day, extend-ing declines from
a three-month high, as the number of drill rigs active in the US rose for the first time in three months amid a global glut.
Futures slid as much as 1.5 percent in New York, after decreasing 1.9 percent on Friday. Drillers put one rig back to work last week, marking the first addition since late last year, according to data from Baker Hughes Inc. Ecuador will propose a cut to output at a meeting next month of producers from within and outside the Organization of the Petro-leum Exporting Countries (Opec) to help boost prices, according to President Ra-fael Correa. Energy compa-nies led declines on the MSCI Asia Pacific Index. “There is a bit of a correc-tion after the spike above
$40, because the market is still oversupplied and de-mand is sluggish, although it’s better than what it was,” Evan Lucas, a mar-ket strategist at IG Ltd. in Melbourne, said by phone. “An average of around $35 a barrel is likely in the second quarter. There are signs that the supply side is feeling the pinch and have been forced to act.” Oil has recouped its loss-es this year, after slump-ing to a 12-year low last month on specu lat ion stronger demand and fall-ing US output will ease a surplus. Hedge funds and other speculators in-creased their net-long po-sition in West Texas Inter-mediate (WTI) futures and options by 17 percent in the week ended March 15 to the highest since June, US Commodity Futures
S “U.S. ,” AC A
It is very crystal
clear that Natuna belongs to Indonesia.” —M
B C U. O
DESPITE El Niño and weak global demand that can affect agriculture and the country’s
export earnings, a local think tank believes that first-quarter GDP growth will still be above 6.5 percent this year.
We are expecting
a third con-secutive quarter of above-6 percent GDP growth.” —M C
₧19.07B
ZERO-COST WAYS TO MAKE YOUR HOME FEEL FRESH
Funds that local governments can tap under the 2016 LGSF
LGSF in the 2016 General Appropria-tions Act.
Abad’s circular also enumerated the projects that may be proposed for funding under the LGSF. For projects relating to health, financial assistance may be given to indigent patients, ei-ther confined or outpatients, and may
also include professional fees.For social services, financial as-
sistance may also be given to indi-gent families through assistance in medical bills, burial assistance, transportation subsidies, food sub-sidies, cash-for-work programs and educational subsidies. For climate-change adaptation programs, an LGU may propose to buy heavy-duty rescue vehicles.
Public infrastructure projects may also be proposed to construct or re-pair local roads and bridges, public m a r k e t s , s l a u g h t e r h o u s -es , mu lt i - pu r pose bu i ld i ngs ,
f lood- cont rol f ac i l it ies a nd water-supply systems.
“Local governments confront rising public expectations re-garding the delivery of services. Despite two decades of imple-mentation of the Local Govern-ment Code, however, local gov-
ernments still face the various challenges in the exercise of their devolved service delivery func-tions. Foremost among these is the raising of sufficient funds for local development,” Abad said in his circular.
The funds to be released un-
der the LGSF may not be used for any other purpose than the proj-ects for which such funds were re l e a s e d , a nd for p ay me nt of persona l ser v ices e x pen- ditures, such as salaries, allow-ances, bonuses and other forms of compensation.
[email protected], March 22, 2016A2
BMReportsAbove-6.5% growth seen in Q1 on polls, infra binge
Additional LGU fund now ready… C
Trad ing Commission (CF TC) data show. WTI for April delivery, which expires on Monday, fell as much as 58 cents to $38.86 a barrel on the New York Mercantile Exchange and was at $38.95 at 11:52 a.m. Hong Kong time. Prices lost 76 cents to $39.44 a barrel on Fri-day, a day after rising to $40.20, the highest level since December 3. Total volume traded was about 31 percent below the 100-day average. The more-active May
futures were 40 cents lower at $40.74 a barrel. Brent for May sett lement dropped as much as 36 cents, or 0.9 percent, to $40.84 a barrel on the London-based ICE Futures Europe exchange. The contract fell 34 cents to $41.20 on Friday. The global benchmark crude was at a premium of 22 cents to WTI for May.
The US drill rig count rose to 387, climbing from the lowest level since on December 2009, according to
data on Friday from Baker Hughes. The nation’s crude stockpiles
have increased to 523.2 million bar-rels, the most in more than eight decades, according to the Energy Information Administration. Speculators increased their net-long positions WTI futures and op-tions combined by 29,602 to 204,551 lots, according to CFTC data. Ecuador will propose an output cut for all producers, except Iran, at the April 17 meeting, Correa told reporters. Bloomberg News
industrial production and services output, we are expecting a third con-secutive quarter of above-6 percent GDP growth. It should challenge the 6.5-percent mark, especially if agriculture and exports do not pull down the two other major sectors,” the think tank said. The think tank added that gov-ernment spending can increase by over 15 percent, since the govern-ment “has released most of the budget to the different agencies.”
It added LGU’s spending is also bound to increase, as local politi-cians increase their election bud-get. “Our constructive view of the Philippine economy in 2016 finds some support in early-January data. In addition, we expect private election spending and public infra-structure expenditures prior to and a little beyond the May presidential
elections to provide the additional boost to the economy,” the think tank said.
Private election and govern-ment spending will get a boost from a low inflation regime, which is expected to average 1.3 percent in the January-to-March period. Inflation was at 1.3 percent in January, and further slowed to 0.9 percent in February, putting year-to-date inflation average at 1.1 percent.
The 0.9-percent inflation rate posted in February was the slowest since October 2015, when inflation averaged 0.4 percent.
“Pressured by even more de-pressed crude oil prices, headline inflation rates should average 1.3 percent in Q1 [first quarter] and should support consumer spending that already has election spending as a main driver. However, rates may start inching up in Q2 [second
quarter] but still to hover below 2 percent,” the think tank said. In January the National Eco-nomic and Development Author-ity said GDP growth averaged 6.2 percent from 2010 to 2015, the highest in 40 years. However, the economy merely posted a full-year growth of 5.8 percent in 2015, the slowest since 2011 when the GDP grew 3.7 percent.
In the fourth quarter the economy grew 6.3 percent, prevent-ing the government from meeting its revised 6 percent-to-7 percent growth target for 2015. Government underspending in the first half of the year, weak export earnings and lackluster performance of the agriculture sec-tor dampened the country’s GDP growth in 2015. The first-quarter GDP growth will be released in May 2016 by the Philippine Statistics Authority.
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SECOND DEBATE Presidential candidates Davao City Mayor Rodrigo R. Duterte and Sen. Grace Poe chat during the second of the scheduled three presidential debates on Sunday in Cebu City. Story on A3. KJ ROSALES/PHILIPPINE STAR POOL PHOTO VIA AP
US rig. . . C A
BusinessMirrorwww.businessmirror.com.ph Tuesday, March 22, 2016 A3
BMReports
THE tightening battle for the Philippine presidency is taking a personal turn, with
candidates accusing each other of everything from corruption to be-ing unpatriotic.
Four contenders for the South-east Asia nation’s top off ice clashed in a fiery debate in the central province of Cebu on Sun-day, with some of the most point-ed exchanges coming between Vice President Jejomar C. Binay and Sen. Grace Poe.
The event started with a dis-pute—as Binay challenged rules prohibit ing cand id ates f rom bringing documents to the podi-um—and quickly turned personal as the Vice President questioned Poe’s patriotism, because she once renounced her Philippine citizen-ship to live in the US.
“You’re not a true Filipino, because you were ashamed of it,” Binay said. “When you took your oath of allegiance to be natural-ized as an American citizen, I ab-jure, you were ashamed of where you came from.”
Poe, 47, responded by saying it’s “love of country that matters.” Working honestly overseas is bet-ter compared to those who “may be here, but stealing money from the people,” she said. Binay, who felt alluded to, denied corruption alle-gations, and said he already signed a waiver allowing authorities to scrutinize his bank accounts.
The clash comes less than two months before the Philip-pines will choose a successor to President Aquino, 56, who can’t run again because of the nation’s
six-year term limit. Opinion polls show the race tightening as the May 9 vote approaches. At stake is Mr. Aquino’s record in curb-ing corruption, boosting growth and trimming the budget, which helped the nation secure an in-vestment-grade debt rating for the first time in 2013.
Tight raceFOR MER Inter ior Sec ret a r y Manuel A. Roxas II, who’s backed by Mr. Aquino, and Rodrigo R. Duterte, the firebrand mayor of Davao City, also participated in the debate. A fifth candidate, Sen. Miriam Defensor-Santiago, was absent because she said she would undergo a cancer-treatment trial.
A Pulse Asia poll conducted between March 1 and 6 found Poe with 28 percent of support, followed by Duterte, with 24 per-cent; Binay, with 21 percent; and Roxas, with 20 percent.
A Social Weather Stations’ poll around the same time put Poe’s support at 27 percent; Binay at 24 percent; Roxas, at 22 percent; and Duterte, at 21 percent.
The Supreme Court on March 8 overturned a ruling by the elec-tion commission that had earlier disqualified Poe from the May
presidential race over her citizen-ship status.
If she wins, Poe pledged to cut taxes on companies and lift restrictions on foreign owner-ship set by the Constitution to encourage more investors into the country.
Binay said he would exempt workers earning P30,000 a month or less from paying income taxes and vowed to embark on a massive infrastructure program. Roxas said he’s also open to review taxes but not during an election period.
All four candidates reiterated their opposition to making di-vorce legal.
The Philippines is Asia’s most Cat hol ic nat ion, and one of the few countries in the world that sti l l bars divorce. Binay and Duterte said they would sup-port having hero’s burial for late dictator Ferdinand Marcos, whose remains are still on display in Ilo-cos Norte province, more than a quarter century after his death.
The second of three debates, held in the central Philippines’s vote-rich Cebu province, aimed to shift the public’s focus toward policy debate and programs to confront social ills. The four main contenders in the May 9 elections,
however, often used the nation-ally televised debate to exchange personal attacks.
President Aquino ends his six-year term in June. Under Mr. Aquino, the economy has been growing steadily, but daunting challenges remain, including cor-ruption and poverty, issues that figured prominently in Sunday’s three-hour debate.
Duterte of southern Davao city, who is known for his tough stance against criminality and corruption, challenged Binay to withdraw from the presidential race with him if the Vice Presi-dent can prove that Duterte has been charged with graft.
“I’d like to be very, very bru-tally frank to the Vice President. Sir, you have so many cases...that’s public knowledge,” Duterte said.
Duterte accused Roxas of a lackluster response to the massive deaths and devastation wrought by Supertyphoon Yolanda (interna-tional code name Haiyan), which ravaged the central Philippines in 2013.
Duterte called Roxas “a weak leader,” adding that the former interior secretary appeared “lost, like a zombie” amid the superty-phoon devastation.
Roxas said Duterte would be a dangerous leader, because he has a tendency to spring into action based solely on his own suspicions, alluding to Duterte’s repeated threats to have criminals and drug pushers killed across the country if he wins the presidency.
The final debate will be held next month. Bloomberg News, AP
Presidential hopefuls trade attacks as race tightens
The rate will be collected from electricity end-users next month, as
this will be reflected in their electric-ity bills as a separate item, as man-
dated by the Renewable Energy Act of 2008, or Repucblic Act 9513.
The FiT-All serves as an incentive to renewable-energy (RE) develop-ers to ensure the viability of their projects. RE includes wind, run-of-river hydro, solar, geothermal and biomass. Consumers are the ones who shoulder the FiT-All, a separate line component in the power bills.
The P0.1240-per-kWh FiT-All is lower than the current FiT-All rate of P0.0406 per kWh, but higher than what National Transmission Corp. (Transco) applied for.
The distribution utilities (DUs) are the ones that collect the FiT-All from end-consumers. They will
remit this to Transco, which was tasked by the ERC to administer the FiT-All fund. The FiT-All fund, in turn, will be used to pay the FiT rates of RE projects.
“As per ERC record, Transco re-ceived the order today [Monday]. The new FiT-All will be reflected in the April bill to consumers,” ERC Spokesman Floresinda Digal said in
a text message. Manila Electric Co. (Meralco) Spokesman Joe Zaldar-riaga confirmed that the FiT-All rate will be collected from its millions of customers. “Yes, we will implement based on the ERC order,” he said.
He added that Meralco’s first re-mittance of collections to Transco was made in March 2015, when the first FiT-All rates were collected in the February bills, covering the January consumption of Meralco customers.
While the FIT system does spell out an extra few centavos in addition-al power rates, it, nonetheless, en-courages more RE plants to be built.
Industry experts pointed out
that RE plants help temper prices in the Wholesale Electricity Spot Market as it pushes out the more expensive plants, like diesel, since RE prices are not subject to the vola-tility of the market.
Moreover, they pointed out that “for a few centavos, it will help im-prove or, at least, stop the worsening air quality, which has led to differ-ent ailments, like asthma, for those living in the metropolis.”
RE power plants, they stressed, allow the displacement of other more polluting sources of electricity, such as coal and oil. This, in effect, lessens the carbon emissions from these plants.
B R L. M
THE statue of Marcelo H. del Pi-lar, the country’s symbol of the freedom of speech and of the
press, now provides a sleeping area for Manila’s vagrants.
The statue was transferred by the city government of Manila from its location on Remedios Circle, where it stood since 2009.
It now stands at the corner of M.H. del Pilar Street and President Quirino Avenue. The city’s fathers found it the appropriate location, because it is near the street that bears his name.
Samahang Plaridel, the associa-tion of veteran journalists and com-municators which sponsored the statue’s construction, assailed the manner in which the statue was re-moved in January this year.
“They pulled out the statue with-out any of the [Samahang Plaridel] members getting a by-your-leave from the city government. We came
to know of the statue’s plight only now,” Samahang Plaridel President Rolando Estabillo said.
“Isa itong pambabastos sa ating bayan,” Estabillo said in a statement.
Del Pilar, also known as Plaridel, fought the Spaniards with the might of his pen, along with Jose Rizal and the other Filipino expatriates in Europe when the country was a colony of Spain.
Asked to comment about the statue’s transfer, Mayor Joseph Es-trada’s spokesman, Diego Cagahas-tian, said: “It is [by virtue of] a city council resolution that transferred it to the corner of M.H. del Pilar and Quirino.”
The P1.3-million statue was originally erected in 2005 at the Paraiso ng Batang Maynila, the children’s park in front of Manila Zoo, which was eventually renamed Plaza Plaridel.
Former Manila Mayor Alfredo Lim caused the transfer of the stat-ue to Remedios Circle, where it was
placed on top of a 6-foot pedestal.In 2004 a fund-raising campaign
was launched to cover the cost of the sculpture, with generous help from then-Manila Mayor Lito Atienza.
Public marketsTHE Manila City government, meanwhile, said it would prioritize the rehabilitation of public markets, considered to be fire traps and un-sanitary to consumers, after a fire hit an old market in the city and claimed the lives of four people.
The fire broke out at the New Ori-ental Market on Carmen Planas Street in Tondo at around 11 p.m. of Sun-day and spread to an adjacent commer-cial-residential building, according to the Manila Fire District.
A woman, identified as Evelyn Veloso, who had rented a stall in the market, and her three children aged 4, 5 and 7, were trapped in their burn-ing room atop the market.
City Engineer Robert Bernardo said the residential-commercial
building had been classified as “con-demned” by the Department of Pub-lic Works and Highways (DPWH) many years ago. Estrada said the incident only justified his plans to rehabilitate the city’s public markets through joint-venture agreements with private developers.
“All of these old public markets are virtual fire traps. It would be devastating if there would be more lives to be lost if we don’t act now and modernize our markets,” Estrada said, adding that no stall owners and vendors will be displaced by the project. Under City Ordinance 8346, or the Manila Joint Venture Ordinance, several of the city’s 17 public markets will be demolished to pave the way for their rehabilita-tion through a public-private sector partnership.
Those eyed for immediate reha-bilitation are the city-run public markets in Quinta, Santa Ana, Sam-paloc, San Andres, Trabajo, Pritil, Dagonoy and Paco. With Joel R. San Juan
FiT-All adjustment likely to raise April bills B L L
CONSUMERS will pay an ad-ditional P0.0834 per kilowatt-hour (kWh) in electricity rates,
representing the provisionally ap-proved feed-in tariff allowance (FiT-All) of P0.1240 per kWh by the Energy Regulatory Commission (ERC).
Represents the provisionally approved FiT-All of P0.1240 per kWh by the ERC
₧0.0834/kWh
Marcelo del Pilar statue nowsanctuary of Manila vagrants
I’d like to be very, very brutally frank to the Vice President. Sir,
you have so many cases...that’s public knowledge.”—D
BusinessMirror [email protected] A4
B J R. S J
Tuesday, March 22, 2016
BMReports
In a 16-page ruling penned by Associate Justice Victoria Isabel Paredes, the CA’s Seventh Divi-sion denied the petition filed by National Association of Electricity Consumers for Reforms Inc. (Nas-ecore) seeking the nullification of the ERC’s order, issued on June 21, 2011, which upheld its earlier deci-sion on May 30, 2003.
The ERC, in its ruling in 2003, granted Meralco’s application for
the approval of its unbundled rates and appraisal of its properties and proposed increase in rates.
Meralco argued before the ERC that the rate increase was to aug-ment its growing operation and maintenance expenses, which in-clude leased properties on custom-er premises, construction work in progress, and building plants for future use.
It will be recalled that the Su-
CA affirms ERC order allowing Meralco to raise electricity rates by ₧0.0168/kWh
THE Court of Appeals (CA) has affirmed the decision issued by the Energy Regulatory
Commission (ERC) in 2011 allowing the Manila Electric Co. (Meralco) to increase its rates by P0.0168 per kilowatt-hour (kWh), despite earlier findings by the Commission on Audit (COA) that it overcharged its customers by as much as P7 billion in 2004 and 2007.
preme Court (SC) affirmed the ERC’s May 30, 2003, order grant-ing the petition of Meralco for an increase in rates while, at the same time, directing the ERC to seek the assistance of the COA in conduct-ing a complete audit of Meralco’s books, records and accounts to see to it that the rate increases are rea-sonable and justified.
Pursuant to the SC ruling, the ERC requested the COA to conduct an audit of Meralco’s books, accounts and records to determine whether the implementation of Meralco’s approved distribution rates resulted in a fair return, and whether the re-covery of generation costs had been revenue-neutral to Meralco.
In November 12, 2009, the COA transmitted to the ERC its audit report revealing the unbundling of Meralco rates effectively resulted in over-recoveries of revenues in excess of the required revenue by P1.682 billion in 2004 and by P5.327 billion in 2007.
The COA report said the over-recoveries were determined after it discovered certain factors or items, which should not have been included in the computation of Meralco’s rev-enue requirements.
However, the ERC ignored the COA report and instead upheld its May 30, 2003, decision, prompting
Nasecore to file a petition before the CA seeking to stop the ERC’s order.
In denying Nasecore’s petition, the appellate court stressed that even if the SC directed the ERC to request the COA to undertake a com-plete audit on the books, records and accounts of Meralco, it recognized that the power to fix the rates of electric distribution utilities pri-marily belongs with the ERC.
“After an examination of the as-sailed orders, we find that the ERC had dutifully complied with the order of the Supreme Court. Just because the ERC did not adopt the findings in the COA report does not mean that the ERC failed to follow the directive in the Lualhati case,” the CA said.
It also stressed that the COA au-dit is not a prerequisite to rate fix-ing, and that the ERC is not bound to accept and adopt any finding that a COA audit may come up with.
The CA did not give weight to the claim of Nasecore that the ERC erred in disregarding the COA’s finding that Meralco’s operating expenses, which include employees pension and other benefits, amounting to P3.479 billion in 2004 and P2. 916 billion in 2007, were not recover-able from consumers as they were not reasonable and necessary in the distribution services.
It also found no merit to Nas-ecore’s argument that the ERC erred when it ignored the COA finding that certain properties and equip-ment, amounting to P3.701 in 2004 and P3.586 billion in 2007, should not be considered as part of the rate base as they were not used and use-ful in the distribution operation.
The CA explained that it would be unlikely for the COA report to come up with a conclusion similar to that used by the ERC when it ap-proved the application for rate in-crease sought by Meralco given the use of different factors.
“The findings in the COA report cannot overshadow the initial con-clusion of the ERC, which led to the approval of the rate increase, mo-reso, considering the fact that the
methodologies used appear to be inconsistent...,” the CA explained.
Likewise, the CA found no merit to Nasecore’s claim that the distri-bution revenues of Meralco, being over and above the ERC-approved distribution revenues, should be treated as over-recovery and sub-ject to refund.
“Instead of auditing the records of Meralco to determine if it was jus-tified in asking for a rate increase, the COA used data…after the imple-mentation of the rate increase,” the CA pointed out. “Simply, the COA relied on the impact of the rate in-crease on the revenues of Meralco, which we find proper,” it added.
Concurring with the ruling were Associate Justices Magdangal M. de Leon and Elihu Ybañez.
After an examination of the assailed orders, we find that the
ERC had dutifully complied with the order of the Supreme Court. Just because the ERC did not adopt the findings in the COA report does not mean that the ERC failed to follow the directive in the Lualhati case.”—C A
[email protected] Editor: Max V. de Leon • Tuesday, March 22, 2016 A5
AseanTuesday
790B baht$70B
Vietnam economy at risk sans reforms–IMFVIETNAM risks being vulner-
able to external shocks if it doesn’t push through with re-
forms to strengthen its banking sys-tem and restructure state businesses, according to International Monetary Fund (IMF) chief Christine Lagarde.
The Southeast Asian nation isn’t in a position to withstand economic blows from tightening of monetary policies elsewhere, a deep and pro-longed drop in commodity prices and a slowing China without reforms, she said in a March 18 interview in Ho Chi Minh City. “The risk is that from being slightly vulnerable, Viet-nam could become very vulnerable to external shocks,” she said. “It would expose the Vietnamese economy, and that would not be good for the Vietnamese population.”
Vietnam’s integration with the global economy has driven growth and reduced poverty. The economy is forecast to grow at 6.6 percent this year, according to Bloomberg sur-veys, while Prime Minister Nguyen Tan Dung has proposed raising the country’s 2016 economic expansion target to 7 percent, from 6.7 percent.
The nation’s poverty rate has dropped to 13.5 percent, from 60 percent in 1993, and its economic growth is expected to be “solid” at more than 6 percent this year, La-garde said in a visit to the country last week, during which she met with the country’s top leaders. Viet-nam, which is in the process of a once-in-five-years political transi-tion, now has one of the world’s most open economies, she said.
The risk is that from
being slightly vul-nerable, Vietnam could become very vulnerable to ex-ternal shocks.”
—L
Thailand’s domestic tourism revenue in 2015
Estimated online sales across Asean by 2010, from the current $6 billion, according to a Bain
& Co. and Google Inc. report
development, she said.Vietnam also needs to make
greater use of exchange-rate flex-ibility to soften the blows of overseas economic shocks and build external reserves, she said. Reforming the na-tion’s state-owned companies and re-solving bad debt at banks will offset the aging of its working-age popula-tion that could be a future drag on growth, according to Lagarde.
Corporate governance“WE believe the banking system needs to be made stronger, better and more capitalized with less stressed
assets in its balance sheets, so the banks can actually fuel the economy,” Lagarde said.
State-owned enterprises need better governance and to refocus on their core businesses, she said.
The country is also at risk with public debt at about 60 percent of GDP and with one of the world’s fastest-aging societies and a work-ing-age population that is beginning to decline.
“When you have the combination of high debt and slightly declining working-age population, you need to be very careful with your mac-
roeconomic stability,” she said in the interview. “You need to be very careful with the revenue you gener-ate and how you spend it.”
PM’s fate hangsVIETNAMESE legislators will vote in the coming weeks on whether to dismiss Dung two months after he failed in his bid to become the Com-munist Party’s chief.
The National Assembly previ-ously had been scheduled to meet during the summer to complete the nation’s once-in-five-year political transition. Lawmakers will also vote
LIPPO Group, the Indonesian conglomerate founded by billionaire tycoon Mochtar
Riady, will partner with GrabTaxi Holdings Pte. for e-commerce de-liveries in Southeast Asia’s largest economy.
The founder’s grandson, John Ri-ady, is spearheading Lippo Group’s foray into e-commerce with a $500 million investment in Matahari-Mall, an online version of its Ma-tahari department store chain. Grab, a regional ride-hailing com-pany, will help transport and deliver goods to bolster MahatariMall’s services, the companies said in a statement on Monday.
The partnership shows how local companies, familiar with consumer preferences, regulations and infra-structure challenges, are trying to tailor services to stay ahead of
Indonesia’s Lippo Group partners with GrabTaxi to speed up distribution
VIETNAMESE Communist Party General Secretary Nguyen Phu Trong (left, front), President Truong Tan Sang (right, front), Prime Minister Nguyen Tan Dung (center, second row) and Chairman of the National Assembly Nguyen Sinh Hung (right, second row) pay tribute to late President Ho Chi Minh at his mausoleum in Hanoi on Monday. The National Assembly is expected to vote early next month to remove Sang, Dung and Hung after they were not elected to the all-powerful Politburo in the party’s congress in January. The assembly is also expected to elect the country’s new leaders. AP
Remarkable potential“VIETNAM has done very well—to have the ability to maintain mac-roeconomic stability in an environ-ment, which is challenging, because the rest of the world is not growing at the pace, and the potential we would like to see is quite remarkable,” La-garde said in the interview. “It has done very well in terms of reducing poverty and it has not increased inequality, which often comes with growth.” Still, the nation’s eco-nomic expansion since 2008 has been slower than the two preceding decades and it has failed to match per-capita-income growth that the region’s most successful econo-mies experienced similar stages in
THE Tourism Authority of Thailand (TAT) has set a challenging new target for
domestic tourism revenue of 900 billion baht this year, up from 790 billion baht in 2015.
This goal is an increase from its 850-billion-baht forecast made earlier this year, in line with the government’s policy to promote do-mestic tourism and generate greater income for local communities.
The additional revenue is expect-ed to come from daily merchants crossing the border from Lao PDR, Cambodia and Myanmar for both business and leisure. Moreover, the TAT’s planned tourism campaigns will be more aggressive.
TAT governor Yuthasak Supa-sorn called the new domestic tour-ism revenue goal “a tough target” at a time when the economy is slowing.
The agency previously made 900 billion baht the goal for 2017.
“The government is promoting service businesses among farming communities to help them generate income when crop prices are low and with a water shortage highly likely this summer,” Yuthasak said.
The Interior Ministry recently approved a 60-billion-baht budget for local administration organi-zations to develop tourism infra-structures and products in their communities.
“The budget will be used to de-velop the supply side of tourism,” he said. “The TAT will take a role in raising demand through aggres-sive campaigns the rest of the year.”
Some major campaigns are Dis-cover Thainess 2016, 12 Hidden Gems and Wan-Tam-Ma-Da-Na-Tiew (a weekday travel promotion), and Yuthasak urged further market-ing of these campaigns.
The TAT also plans to promote new tourism routes connecting popular destinations in Thailand
with neighboring countries, such as Lao PDR, Cambodia and Myanmar. It is awaiting government approval for the 780-million-baht special budget for its Quick Win tourism campaign and four big events to lift domestic tourism.
For international markets, Yuthasak said the TAT is not worried about inbound tourism this year thanks to the sharp rise of foreign tourist arrivals.
The Tourism and Sports Ministry projected foreign tourist arrivals to Thailand in the first quarter this year of 8.94 million, up 14.3 per-cent year-on-year. Revenue from in-bound tourism is projected to grow 18.2 percent to 660 billion baht in the first quarter.
Arrivals from China are expected to rise 25.4 percent to 2.51 million visitors, with arrivals from Europe gaining 8.3 percent to 2.09 million, and Asean visitors increasing 5.7 percent to 1.89 million.
For domestic tourism, the min-istry expected income to grow 6.9 percent to 210 billion baht in the first quarter.
The government aims to expand the country’s total rail network to 7,000 kilometers by 2022 to reduce logistics costs and take advantage of the country’s geographic position.
Prime Minister Prayut Chan-o-cha said the expansion is needed as the country has failed to make headway in rail development for
years. The rail network currently stretches 4,070 km. He was speak-ing at a seminar and exhibition on rail component production at the Airport Rail Link’s Makkasan sta-tion on Wednesday. He said the government is trying to create a connectivity network for all modes of transportation.
Transport Minister Arkhom Termpittayapaisith said the minis-try has a plan to transform the coun-try into a major transport hub for Asean and the Mekong subregion, as well as a transit route linking the Asia Pacific with South Asia, Africa and Europe.
The move is included in the na-tional transport investment plan from 2015 to 2022 and the national logistics strategic plan from 2013 to 2017. “The Transport Ministry wants a rail network offering a low-cost service. It is currently second in affordability after water transport,” said Arkhom, noting rail shipments account for only 2 percent of all transport volume and the ministry aims to push this up to 5 percent by 2022.
The move would help reduce lo-gistics costs from 14 percent of GDP to 10 percent to 12 percent within eight years, a similar level to other advanced nations.
After the rail network increases to 7,000 km, factories could be set up to produce train components, signal systems and carriages, Arkhom said.
He said the ministry will also work with the Science and Tech-nology Ministry and the Industry Ministry to develop rail compo-nents, human resources and signal systems by adopting technologies from abroad.
Land around the rail stations and on both sides of the rail tracks will be commercially developed to supple-ment income for financing the rail operations, the minister said. MCT
Thailand crafting aggressive domestic tourism campaign
on dismissing President Truong Tan Sang and National Assembly Chair-man Nguyen Sinh Hung during meetings to be held from March 31 to April 12, Nguyen Hanh Phuc, gen-eral secretary of National Assembly, said at a briefing in Hanoi.
The move, being characterized as procedural by legislators, is unusual.
“It’s pretty rare, but did happen twice in the past, when the time period between the Party Congress and the election to form the new Na-tional Assembly was too long,” Cao Sy Kiem, a National Assembly member, said by telephone from Hanoi. “This is to make sure the process of hand-ing over the jobs will be smoothly done. It also make more sense as the prime minister is no longer a Polit-buro member now.”
‘Lame duck’A DISMISSAL will allow Dung, who wielded significant power, to move on to the next stage in his career and allow the government to avoid an extended period of inaction before the new prime minister and other leaders are appointed.
“For a Vietnamese leader, re-spect is very important and you can only govern if you have respect,” said Vu Tu Thanh, chief Vietnam representative of the US-Asean Business Council. “If you feel people have their deference and respect divided between you and the in-coming guy, you want to get out of there and focus on your future. He is a lame duck.”
Current Communist Party Gen-eral Secretary Nguyen Phu Trong was chosen by delegates to a second term in January over Dung. The par-liament will also vote to elect new leaders to take the country’s three top positions, Phuc said.
Bloomberg News
foreign rivals as competition heats up. Japanese e-commerce company Rakuten Inc. closed down its Indo-nesian unit as of March 1, while China’s JD.com Inc. has recently set up shop in Indonesia.
“Speed is really important in
this business,” said Ridzki Kra-madibrata, managing director of Grab Indonesia. “You need to be able to do multiple things at the same time, because if you can’t do that, the market will outgrow you and you will lose your opportunity.”
Rising incomesMATAHARIMALL’S site allows cus-tomers to buy on the Web and pick up items from Lippo’s stores. Its ri-val Tokopedia, which is backed by Japan’s SoftBank Group Corp. and Sequoia Capital, has already formed a similar alliance with Go-Jek, a motorcycle-taxi-booking compa-ny, to deliver purchased items to customers.
“Our combined knowledge of the Indonesian market will help us build the most effective online-to-offline experience—to ensure that online shoppers anywhere in Indonesia can receive or collect their purchases easily,” John Riady, a Lippo Group director, said in the statement.
Grab’s alliance with Lippo also underscores its aggressive market-share acquisition strategy in In-donesia, where it competes with Uber Technologies Inc. and Go-Jek. Grab’s private car-hailing service grew 30 percent in Indonesia in Feb-ruary, according to the statement. It has more than 50 percent of the country’s motorcycle taxi market in March, it said.
Technology startups are trying to capitalize on rising incomes and growing mobile-phone use in Southeast Asia, where 250 million consumers are now con-nected via smartphone and 100 million engage in online trans-actions, according to a report by Bain & Co. and Google Inc. released last week.
The report predicts online sales across Southeast Asia to surge to $70 billion by 2020, from $6 bil-lion now. Bloomberg News
BISHOP IN JAKARTA Australian Foreign Minister Julie Bishop (right) is greeted by her Indonesian counterpart Retno Marsudi during their meeting in Jakarta on Monday. AP
The WorldBusinessMirror [email protected], March 22, 2016 | Editor: Lyn ResurreccionA8
Obama in Cuba: Historic Castro summit a key test for détente
For Obama, there’s no better place than Havana to show that engagement can do more than isolation to bring about tangible change in the tiny communist nation. Yet, for the Cubans, the glaring question is whether their own government is ready to prove the ambitious diplomatic opening is more than just talk.
Obama opened the first presi-dential visit to Cuba in nearly 90 years on Sunday when Air Force One touched down in Havana. Strol l ing through t he g rand cobblestoned plazas of Old Ha-vana with his wife, Michelle, and daughters Sasha and Malia, Obama created an indelible im-age for both Cubans and Ameri-cans of the peacemaking that he and Castro have cautiously but doggedly pursued.
“That’s the future that we hope for: young American children, young Cuban children, by the time they’re adults, our hope is that they think it’s natural that a US president should be visiting Cuba,” Obama told American dip-lomats assigned to the newly re-opened US Embassy. “They think it’s natural that the two peoples are working together.”
Indeed, the US and Cuba are working more closely together now than at any time, since rela-tions took a nose dive amid Cu-ba’s 1959 revolution. Yet, while Americans are now flocking to Cuba in greater numbers, closer ties have to bring about the de-gree of change that many Cubans hoped would follow after Obama and Castro moved to normalize relations 15 months ago.
Since taking power in 2008, Raul Castro has orchestrated economic and social reforms with lasting and broad-based impact, though, to many Cubans and for-eigners, they appear slow to ma-terialize. Not only are hundreds of thousands of Cubans now able to pursue free enterprise, but restrictions on cellphones and Internet have been eased and citizens feel more comfort-able d iscussing Cuba’s prob-lems. Yet, Castro has given little
ground when it comes to chang-ing Cuba’s single-party system or easing strict limits on the media, assembly and political dissent. His government has also repeat-edly chided Obama for saying he wanted to empower Cubans.
None of that has dissuaded Obama, who insists that any in-transigence by Cuba’s government only proves why Cubans will be better off when they’re intimately exposed to American values.
“Let God will that this is good for all Cubans,” said Odilia Collazo, a 79-year-old Havana resident, as she watched Obama’s arrival on state television. “It seems to me that Obama wants to do something good before he leaves.”
To that end, Obama came to Havana hoping his visit would spur Castro to offer gestures of good faith and meaningful change, which would undermine cr it ics who accuse Obama of kowtowing to an authoritarian government. Though Cuba ap-proved US hotel chains Starwood and Marriott to operate here and moved to lift fees on con-verting US dollars, those steps pale in comparison to sweeping changes Obama has enacted to lift decades-old US restrictions.
On his first full day in Cuba, Obama was to lay a wreath on Monday at the memorial to Jose Marti, a Cuban independence hero, before heading to Castro’s presidential offices. After a se-ries of meetings, the two leaders planned to address reporters.
The W hite House’s attempts to get Castro to agree to a joint
news conference appeared un-successful, and it was unclear whet her t he y ’ d a n s wer a ny questions. Castro appears to be closely and intensely managing what constitutes the most im-portant change in Cuban foreign policy since the Cold War.
Though Obama’s aides have downplayed expectations for the meeting, Castro’s remarks along-side Obama will be closely parsed for indications of whether he’ll respond to Obama’s opening with major new domestic changes.
Obama also planned an event with US and Cuban entrepre-neurs a imed at championing Cuba’s f ledgling private sector. He was to be feted in the evening
at a state dinner, an honor il lus-trating just how far the US and Cuba have come despite their deep ideological differences.
His visit was to continue on Tuesday with a major speech that Cuban officials said would be carried on T V. Before de-parting for Argentina, Obama planned to meet with political dissidents and attend a game between Major League Baseball ’s Tampa Bay Rays and Cuba’s be-loved national team. In his first few hours on the island, Obama created indelible images of a new US-Cuba relationship as he walked the rain-soaked streets of Havana and dined at a privately owned restaurant in a bustling,
work ing-c lass neighborhood. Jubilant crowds surged toward his heavily fortified motorcade, reminders of the Cuban people’s deep affection for Americans, de-spite decades of enmity between their governments.
Yet, in a pointed reminder that Obama’s aspirations for improved human rights in Cuba have yet to be fulfilled, a group of anti-government protesters were arrested while Air Force One was f lying to Cuba, a scene that plays out weekly in Havana. Members of the Ladies in White group, one of Cuba’s most prominent oppo-sition groups, were expected to attend Obama’s meeting with Cuban dissidents. AP
S EOUL, South Korea—North Korea on Monday fired four short-range projectiles into
the sea, Seoul officials said, in a continuation of weapon launches the country has carried out in an apparent response to ongoing South Korea-US military drills it sees as a provocation.
The projectiles launched from the northeastern city of Hamhung flew about 200 kilometers (125 miles) before landing in waters off North Korea’s east coast, South Korean defense officials said on condition of anonymity, citing de-partment rules. Monday’s launches came three days after Seoul said
North Korea launched its first medium-range missile into the sea since early 2014.
South Korea’s Yonhap news agency earlier reported that a missile had been fired, but later changed that to say that projec-tiles had been fired. The firings appear to be North Korea’s re-sponse to the annual springtime military exercises that it says are an invasion rehearsal.
Earl ier this month, North Korea fired several short-range missiles and artillery shells into the sea and threatened pre-emptive nuclear strikes against Washington and Seoul. AP
Seoul: North Korea fires 4 short-range projectiles
A MAN watches a TV news program showing a �le footage of the missile launch conducted by North Korea, at Seoul Railway Station in Seoul, South Korea on March 3. North Korea �red several short-range projectiles into the sea o� its east coast Thursday, Seoul o�cials said, just hours after the U.N. Security Council approved the toughest sanctions on Pyongyang in two decades for its recent nuclear test and long-range rocket launch. The screen reads “ North Korea launched missiles.” AP
TUCSON, Arizona—Donald Trump’s campaign in Arizona is centered on his hard-line against illegal immigration, a
stand that supporters embraced in a series of tense rallies ahead of Tuesday’s presidential primary in the border state.
“Illegal immigration is gonna stop,” Trump said on Saturday night in Tucson. “It’s dangerous,” he said. “Terrible.”
Both in Phoenix and Tucson, Trump was introduced by former Arizona Gov. Jan Brewer, who pushed tough immigration laws in office, and Joe Arpaio, the Maricopa County sheriff who made his name by chasing down people who are in the country illegally. The county includes Phoenix and nearly two-thirds of Arizona’s population.
Protesters showed up at every event. In Phoenix they blocked the main road into his outdoor rally for several hours before it started. In Tucson they interrupted him and some were tossed from the event.
Police said on Sunday that about half a dozen people were arrested at the Arizona rallies, including two on misdemeanor charges of assault. It was not clear how many were protesters or Trump supporters.
Trump was campaigning in Arizona ahead of Tuesday’s primary in which the winner will take all 58 delegates at stake.
Trump’s main rivals, Texas Sen. Ted Cruz and Ohio Gov. John Kasich, are desperately trying to prevent the real-estate mogul from accumulating the 1,237 delegates needed to secure the nomination at the party’s national convention in July. They are hoping for a contested convention in which delegates would be free to turn from Trump if he fails to win a majority on the first ballot. Trump has won 678 delegates in contests held thus far, according to a count by The Associated Press. Cruz is in second place with 423 delegates, and Kasich is in third with 143.
His rivals hope to offset a likely Trump win in Arizona on Tuesday with a strong showing in the Utah caucuses. Limited polling shows Cruz leading in the state, where Mormons account for two-thirds of the state’s 3 million residents. Mitt Romney, the 2012 Republican presidential nominee and the Mormon faith’s most visible member, said he intends to vote for Cruz in the caucuses, but stopped short of endorsing the Texas senator, an uncompromising conservative.
However, Utah’s delegates will be distributed proportionally based on the percentage of votes—unless a candidate gets more than 50 percent, which would give that person all 40 delegates.
In Arizona Trump treated the latest protests with a mix of pacifist rhetoric and a mocking tone. “We love our protesters, don’t we?” he asked. As security removed one or more, he said: “We want to do it with love,” then added bitingly, “Get ‘em outta here.”
In Tucson one protester carried a sign with an image of a Confederate flag over an image of Trump; another wore a Ku Klux Klan-style white sheet. A man in the crowd attacked the protester with the Confederate sign, kicking and punching him before being arrested. The protesters were led out by security.
“It was a tough thing to watch,” Trump said on Sunday on ABC’s This Week, adding, “But why would a protester walk into a room with a Ku Klux Klan outfit on?”
Trump made clear, though, “We don’t condone violence.”
The chairman of the Republican National Committee, Reince Pr iebus, to ld ABC television that “as far as everyone getting involved in the crowds, leave it to the professionals” in law enforcement. As the rally attendees later streamed out of the hall, protesters hurled two water bottles at them and called them racists.
Arizona Democrats also vote on Tuesday, and contender Bernie Sanders campaigned on Saturday at the US-Mexico border in Nogales.
Standing in front of a tall, steel fence that divides the two countries, the Vermont senator promised to keep immigrant families together by taking more steps than President Barack Obama has done to protect many from deportation. Sanders called Arpaio a bully and he bemoaned the “divisive, bigoted and xenophobic comments of people like Donald Trump.”
Late Saturday he held his fourth Arizona rally in the past five days, this time just outside of downtown Phoenix. Sanders is hoping for a win in Tuesday’s Arizona primary to propel him through the next month when several states more favorable for him are due to vote.
Sanders is looking to rebound from his defeat last Tuesday in five state contests to Hillary Clinton, which gave the former secretary of state a nearly insurmountable lead of more than 300 pledged delegates. AP
Trump’s immigration stance resonatesat tense rallies
summit a key test for détente
90The number years that no American president set foot on Cuban soil until the Obama visit
HAVANA—Brushing past profound differences, President Barack Obama and Cuban
President Raul Castro will sit down on Monday at Havana’s Palace of the Revolution for a historic meeting, offering critical clues about whether Obama’s sharp U-turn in policy will be fully reciprocated.
U.S. President Barack Obama holds an umbrella for �rst lady Michelle Obama as they walk across the tarmac upon their arrival at Jose Marti International Airport in Havana, Cuba, on Sunday. Obama and his family traveled to Cuba on Sunday, becoming the �rst US president to visit the island in nearly 90 years. AP
First, heavily armed police led by the interior minister, waded into a Shiite militia base south of Baghdad and arrested its deputy commander, accused of organizing attacks on Sunni mosques. �ey loaded the man, Ali Reda, into an armored sport utility vehicle (SUV).
�en militia reinforcements de-scended, surrounded the police and demanded Reda be freed. Weapons were drawn. �e minister, Moham-med al-Ghabban, the highest �g-ure in Iraq’s police force, frantically called Baghdad from inside his SUV.
In the end, al-Ghabban surren-dered his prisoner and left empty-handed, angry and humiliated.
�e stando� in mid-January, de-scribed to �e Associated Press (AP) by six di�erent o�cials and militia leaders, was a stark example of the power that Shiite militias have ac-crued in Iraq and their boldness in wielding it.
�ese militias, many of them backed by Iran, mobilized in 2014 to �ght Sunni extremists from the Islamic State (IS) group. However, they are now showing no intention of standing down after the battle, demanding instead to be a major force shaping Iraq. �at prospect worries not only Iraq’s Sunni minor-ity but also o�cials in the military and the Shiite-led government, who fear the militias will dominate Iraq the way the Revolutionary Guard does in Iran and the guerrilla group Hezbollah does in Lebanon.
Two top generals warned that the army could eventually come to blows with the militias, known col-lectively as the “Hashd,” Arabic for “mobilization.”
“�ey [the militias] have now in�ltrated the government and are meddling in politics,” said Ali Om-ran, commander of the army’s �fth Infantry Division and a veteran of numerous battles against IS. “I told the Hashd people that one day I and my men may �ght them.”
�e more than 50 Shiite militias in Iraq have between 60,000 and 140,000 �ghters, according to estimates from the government and the Hashd it-self. �ey are backed by tanks and weapons, and have their own intelli-gence agency, operations rooms and court of law.
�e larger militias, like Asaib Ahl al-Haq, the Hezbollah Brigades, Badr
and the Peace Brigades, have been in place since soon after the 2003 ouster of Saddam Hussein. �ey are linked to political parties, ef-fectively forming armed branches for politicians.
But the ranks of the militias swelled dramatically after IS overran nearly a third of Iraq in the summer of 2014 and Grand Ayatollah Ali al-Sistani, Iraq’s top Shiite cleric, called on able-bodied males to �ght IS. At the time, tens of thousands turned out.
�ose same militias now want to remain a permanent, indepen-dent armed force and are resisting attempts to integrate them into the military or police, the AP found from interviews with more than 15 gov-ernment o�cials, army generals and militia leaders and visits to Tikrit and Samarra, Sunni-majority areas where the militias now hold power. �e militias insist they have earned a special status, pointing to the 5,000 militiamen killed and 16,000 wounded �ghting IS.
“�ose who sacri�ced more are entitled to more,” said Hamed al-Jazaeery, head of the al-Khorasani Brigades militia. “What is written with blood cannot be removed. It is not ink on paper.”
Al-Jazaeery wears the black tur-ban of a cleric and the camou�age fatigues of a �ghter. �e walls of his o�ce are adorned with photos of the leader of Iran’s Islamic Revolution, Ayatollah Ruhollah Khomeini, and its current supreme leader Ayatollah Ali Khamenei. Other photos show al-Jazaeery posing with Iranian Gen. Qassem Suleimani, the powerful Rev-olutionary Guard �gure who helped organize the Iraqi militias against IS.
“We want to be a third power in Iraq,” al-Jazaeery alongside the army and police, said. “Why can’t the Hashd be like the Revolutionary Guard in Iran?”
�e model of the Revolutionary Guard, often cited by militia lead-ers, would be a dramatic change for Iraq’s militias. In Iran the Guard is an elite force independent of—and better armed than—the military, tasked with “protecting” the Shiite cleric-led power structure. It is e�ec-tively a state within a state, rivaling the political strength of Iran’s su-preme leader.
Sunnis fear such militia power would enforce Shiite domination of
Iraq. Sunnis already accuse militias of targeting them with abuses. Hun-dreds of green and red Shiite ban-ners and images of imams—historic religious leaders revered by the Shi-ites—are posted all over Sunni areas under militia control north and east of Baghdad, in a blatant challenge to sectarian sensitivities.
�e militias call themselves “holy” or “glorious,” and often talk of their battle as a �ght for Shiism rath-er than Iraq. �ey give Shiite names to major o�ensives, only for the gov-ernment to ban their use.
“I joined the Hashd for the imams, not for the government,” said one militiaman, Mohammed al-Azghar, in the central city of Samarra.
�e o�cial agency created to oversee the �ghters, the Popular Mobilization Commission, has in-stead become the militias’ political lever in the machinery of power. �e government now funds the militias, but some of them refuse to even give o�cials the names of their �ghters, citing security concerns.
“People fear and trust us more than they fear and trust the govern-ment,” boasted Ahmed al-Assady, a Shiite lawmaker and spokesman for the Mobilization Commission. “�ey fear us because we act, not just talk.”
Advisers from Iran’s Revolutionary Guard and Lebanon’s Hezbollah have helped Iraq’s militias in the battle against IS. Billboards around Baghdad announce the “martyr-dom” of �ghters, alongside images of Iran’s Khamenei and Khomeini and Hezbollah leader Hassan Nasrallah. Militia TV channels and newspapers also accuse the government of cor-ruption and cast the militias as the true protectors of Iraqis.
In Tikrit, Saddam Hussein’s home-town north of Baghdad, the extent of the militias’ prestige is on display: �e headquarters of a senior militiaman, Jassim al-Husseini, is at one of the late dictator’s opulent palaces along the Tigris River. �e chain-smoking al-Husseini wears a military brown jacket and walks with a cane because of a leg injury sustained while �ght-ing IS last year. He con�dently spoke of the �aws of Iraq’s government and said the militias cannot be integrat-ed into its security forces.
“Integrating us in the security forces and the military is not an idea that will help build our na-tion,” he said.
Now the militias demand to par-ticipate in a long-expected o�ensive to retake largely Sunni Mosul, Iraq’s second-largest city and the main stronghold of IS rule in Iraq—some-thing the military and armed Sunni groups oppose.
“�e Hashd will take part in the
battle to liberate Mosul no matter what,” said senior Shiite politician Hadi al-Amry, who is also com-mander of the Iranian-backed Badr militia. “No one can stop us from en-tering Mosul.”
In Samarra Sunnis say they al-ready experience what is feared could happen if the militias enter Mosul. �e city has a Sunni major-ity but is home to one of the most revered Shiite shrines, blown up by al-Qaeda 10 years ago. In 2014 Shi-ite militias successfully prevented IS from taking Samarra and have kept their grip on the city since.
Local dignitaries and o�cials air a �ood of grievances blamed on mi-litias, including killings of Sunnis, takeovers of schools and the forc-ing of Sunnis to sell property in the prime real estate area close to the shrine. To the thud of artillery shell-ing in the distance, the city council’s deputy chairman, Muzher Fleih, said 650 Sunnis have disappeared, believed abducted and killed by the militias. Among them was his broth-er, who disappeared last year and was found dead soon after.
“�e city is oppressed,” he said.Militia leaders insist any abuses
are isolated incidents. “We are not angels,” said al-Assady, the Mobiliza-tion spokesman. “It is only natural that we make mistakes.”
Some in the government and military are beginning to see the militias as a danger to the state it-self. In a sign of wariness over the militias’ autonomy, Shiite Prime Minister Haidar al-Abadi charged re-cently that government funds to the Hashd were being mismanaged. One of his close aides told the AP that the comments were directed at Abu Mahdi al-Mohandes, the Hashd’s most powerful �gure, who is wanted by the US in connection with the 1983 bombing of the American and French embassies in Kuwait.
�ere has also been friction with the military. Last month militiamen refused orders to vacate a building in a military base north of Baghdad, and the army sent troops to take it over. �ey found the militiamen ready for a �ght, with snipers sta-tioned on the roof and in sandbagged positions around it. �e dispute was resolved when a substitute building was found for the militiamen.
Since its 2014 collapse, the mili-tary has been slowly recovering. But Gen. Abdul-Wahab al-Saadi, deputy commander of the army’s elite counterterrorism force, said the militias don’t want the military to regain its strength.
“�ey may be tempted to take on the army if they don’t have their way,” he said. AP
Fears in Iraqi govt, army over Shiite militias’ power
BAGHDAD—It was a tense confrontation between two forces supposed to be on the
same side in Iraq.
IN this February 7, 2016, photo, Shiite �ghters clash with the Islamic State (IS) group at the frontline in Tikrit, Iraq, 80 miles (130 kilometers) north of Baghdad. Iraq’s Shiite militias, mobilized in 2014 to �ght the IS group, are now showing they have no intention to stand down once the �ght against the Sunni extremists is over. AP
MADRID—A bus carrying university exchange stu-dents back from Spain’s
largest �reworks festival crashed on Sunday on a main highway in the northeast, killing at least 13 passengers and injuring 34 others, o�cials said.
�e passengers included Spaniards and foreign nationals from around 20 countries, authorities said.
�e bus, which was carrying 57 passengers, appeared to have hit a guardrail of the AP7 highway be-fore cartwheeling across the road, slamming through a divider and landing on its side, said Jordi Jane, spokesman for Spain’s northeastern Catalonia province.
�e students, part of the Eras-mus exchange program, had trav-eled to the eastern city of Valencia to take part in the renowned Fallas �reworks festival and were return-ing when the bus crashed, Jane said. Most were studying at two universi-ties in Barcelona.
�e crash took place near Fregi-nals, halfway between Valencia and Barcelona.
Initially, Jane said 14 had died in the crash, but Spanish Interior Minister Jorge Fernandez Diaz later con�rmed the death toll was 13. He said 28 passengers received medical treatment in local hospitals and oth-ers received �rst aid at the crash site.
�e regional government of Cata-lonia said in a statement in the early evening that “according to the latest data, the ill-fated bus had students from Hungary, Germany, Sweden, Norway, Switzerland, Czech Repub-lic, the United Kingdom, Italy, Peru, Bulgaria, Poland, Ireland, Japan, Ukraine, Holland, Belgium, France, Palestine, Turkey and Greece.”
It added that two countries—New Zealand and Finland—were still pending con�rmation.
�e statement said autopsies had been completed on nine of the 13 dead and a judge would release the bodies to families once full identi�-cation was complete in all cases.
Italy’s Foreign Ministry con-�rmed that Italian citizens were among the dead, but did not say how many. But the Italian news agency ANSA, reporting from Ma-drid, said as many as seven Italians died in the crash.
Italian Premier Matteo Renzi said in a tweet that his heart is “broken for the Italian victims and for the other young lives destroyed.”.
Five Italians were reported to be among the injured who were taken to hospitals in Spain.
Poland’s Foreign Ministry said one Polish man was hospitalized after the bus crash and Swiss au-thorities said one young Swiss woman was injured, but had been discharged from a hospital.
�e bus that crashed was one of �ve that had traveled to the festival with students from Bar-celona, the Catalan government said in a statement.
Television images from state broadcaster TVE showed the bus also crashed into an oncoming car on the opposite side of the high-way. �e passengers in the car were injured, the Catalan govern-ment said.
�e bus driver was being held at a police station in the city of Torto-sa, Jane said. Road conditions were good at the time of the crash and investigators were looking into the cause of the tragedy, he said.
Fernandez Diaz said the driver passed alcohol and drug tests he was given.
Jane said emergency rescue workers were working to clear the wreckage that had closed the major highway linking Spain with France along the Mediterranean coast in both directions.
�e Erasmus program provides foreign-exchange courses for stu-dents from counties within the 28-nation European Union and en-ables them to attend many of the continent’s best universities. AP
SPAIN BUS CRASH KILLS 13 EXCHANGE STUDENTS; 34 INJURED
RIO DE JANEIRO—A new poll published on Sun-day suggested strong
support for the impeachment of embattled Brazilian Presi-dent Dilma Rousse� in a politi-cally polarized country, mired in an economic recession and a corruption probe that has ensnared much of the county’s political brass.
�e poll by the respected Datafolha agency, published in the Folha de S. Paulo newspaper, said 68 percent of people sur-veyed want to see lawmakers vote to impeach Rousse�. �at’s up 8 percentage points since February, with the jump was highest among the rich, who supported Rousse�’s impeach-ment by 74 percent.
Just 10 percent rated Rous-se�’s goverment good or excel-lent, with 69 percent calling it bad or terrible.
�e ratings of her predeces-sor, former President Luiz Inacio Lula da Silva, were also down—possibly dented by controversy over his appointment as Rous-se�’s chief of sta�, a move critics said was a bid to shield him from corruption allegations.
Fifty-seven percent said they disapprove of him—a dramatic drop from the near-90-percent approval rating he had when leaving o�ce in 2010.
But in a sign of the depth of Brazilians’ disgust with the en-tire political establishment, Silva held onto his ranking as the best president Brazil ever had, with 35 percent of the survey’s respondents picking him, com-pared with the 16 percent who chose his predecessor, President Fernando Henrique Cardoso.
A Supreme Court justice on Friday suspended Silva’s nomi-nation to the Cabinet post, and the full Supreme Court will have to decide whether he can take o�ce. Under Brazilian law, Cabinet members cannot be in-vestigated, charged or impris-oned unless authorized by the Supreme Court.
�e Datafolha survey was carried out on March 17 and 18, with face-to-face inter-views with 2,794 people in171 cities and towns. �e margin of error is plus or minus 2 percent-age points.
�e e�ort to impeach Rous-se� over allegations of �scal mismanagement moved forward last week when the lower house created a special commission on the matter.
Rousse� backers say im-peachment is a power grab by opponents who themselves have been sullied by an unre-lated probe into kickbacks and bribery at the state-run oil com-pany Petrobras. Eight of the 65 members of impeachment com-mission are currently facing charges, as is the speaker of the lower house, Eduardo Cunha, who opened the impeachment proceedings.
Former President Cardozo, meanwhile, said in an inter-view published Sunday by O Estado de S. Paulo that impeach-ment is a way out of the coun-try’s problems.
“With the government’s inca-pacity to function that one sees today, her (Rousse�’s) ability to hold �rm and make the govern-ment work, I think the path is impeachment,” said Cardozo, who governed the country from 1995-2002.
�e political turmoil comes as Brazil prepares to host the Sum-mer Olympics in August while struggling with an economic crisis and an outbreak of the Zika virus, which health experts believe may cause a devastating birth defect in newborns. AP
Brazil poll shows strong support for president’s impeachment
The World BusinessMirror Editor: Lyn Resurreccion •[email protected] A9
Tuesday, March 22, 2016 •Editor: Angel R. Calso
OpinionBusinessMirrorA10
Yes, the PHL is greeneditorial
WANTING to always keep an open mind and learn from others, it is good to invite self-proclaimed experts to the Philippines. We might learn something that is beneficial.
Recently, former US Vice President and losing presidential candidate Al Gore came to talk about global warming and climate change. He spoke of the need for the Philippines to reduce, if not eliminate, as quickly as possible, our use of coal-fired power plants for electricity generation. We agree that our getting nearly 50 percent of our electricity from coal is not the best situation, and we need to move away from coal.
Some people have equated the global warming and climate-change concept as almost a religion, and there is good reason to say that. Al-though on virtually constant tour of giving speeches around the globe, Gore refuses to entertain any questions from his audiences for several years. You might have noticed that is very similar to a parish priest who also does not answer questions after delivering a homily.
There is good reason that Gore does not answer questions, because he might be asked about his previous statements. For example, in 2007 as Gore accepted the Nobel Peace Prize for his campaigning on climate change, he said, “The North Polar ice cap is falling off a cliff. It could be completely gone in summer in as little as seven years. Seven years from now.”
The year 2014 came and went, and the polar ice cap is still there. We will give Gore the benefit of the doubt, since he did say “could” and not “would.”
However, what is the factual reality of the Philippines and its energy use? Renewable energy (RE) is defined as “energy from a source that is not depleted when used, such as wind or solar power.” We should include nuclear power in that definition but “greenies” usually hate nuclear power, as it meets all their criteria, but without the tree-hugging.
The facts are that the Philippines has a higher percentage of its total power generation (29.6 percent) from RE sources than Germany, China, Ireland, Russia, Mexico, France, India, Australia, the US, Japan, Indone-sia, the United Kingdom, Malaysia, Thailand and South Korea. Overall, the Philippines is not doing too bad. We rank 81st out of 150 countries.
But we are also told that a critical problem is a nation’s “carbon foot-print,” the amount of carbon dioxide and other carbon compounds emit-ted due to the consumption of fossil fuels by a particular person.” Here, too, the Philippines has a lower per-person “carbon footprint” than Viet-nam, Indonesia, Mexico, Iraq, Thailand, Switzerland, Hong Kong, China, Malaysia, the UK, the US, Australia and Japan, among 120 countries producing more carbon than Philippines.
In fact, the average Filipino has a smaller carbon footprint than Gore, who lives in a 20-room house using an average of 22,619 kilowatts per hour of electricity a month, more than twice the electricity that an aver-age American family uses in an entire year.
We can hardly wait for Gore’s speech to the other industrialized nations that are not as clean and green as the Philippines.
SSS pension hike should not be a zero sum
THE outcry from pensioners of the Social Security System (SSS) following the veto by President Aquino of the proposed P2,000 increase in their monthly pension was understandable.
v iabi l ity problem can be ad-dressed normally in several ways: by increasing premium contri-butions; by withholding any in-crease in benefits; and by improv-ing efficiency in collections and investments.
The SSS could have presented a positive public image, even before the lawmakers drafted the proposal to raise retirees’ pension, if it showed that it had become very efficient that it could increase benefits.
Actually, the SSS had been issu-ing public statements to show its healthy finances. For instance, a newspaper, citing an SSS official, re-ported in February that the SSS was on track to meet, or even exceed, its
target of 6-percent return on invest-ments for 2015.
The SSS earned more than P26.93 billion from investments and other income in the first 11 months of 2015, according to the report. This translates to a return of over 6 per-cent for the fund’s P423.8-billion to-tal investments as of end-November last year. Added to contributions from the fund’s 33.5 million mem-bers and their employers, the SSS generated total revenues of P147.7 billion in the first 11 months of 2015. For 2016, the SSS is project-ing an investment income of P30 bil-lion and P141 billion from member contributions.
So why the sudden ringing of alarm bells about the fund’s col-lapse after the proposed increase in pension rates? The SSS should have looked for other sources, like improv-ing efficiency, but rejecting the pro-posal outright seemed callous. There should have been a compromise, if P2,000 is too high, but definitely not a zero sum.
While we understand the need to maintain viability, the SSS cannot just continue being inefficient and tell its retirees to take it or leave it.
For comments, e-mail mbv.secretariat@
gmail.com or visit www.mannyvillar.com.ph.
HOM
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THE ENTREPRENEURManny B. Villar
ONE of the most interesting people of the 21st century is turning out to be a man who is difficult to describe. Nas-sim Nicholas Taleb is an author, scholar, statistician, former
financial-markets trader and does risk analysis. And he is a graduate of Wharton School, University of Pennsylvania, holding Masters in Business Administration degree as most, but not all (as we have been told countless times), Wharton graduates do.
Are you too fragile for the stock market?
OUTSIDE THE BOXJohn Mangun
Taleb may be best known for his best-selling 2007 book The Black Swan, about unpredictable events, part of a four-part philosophical se-ries on uncertainty titled The Incerto. His last book published in 2012 is for me the most enlightening, Anti-fragile: Things That Gain From Disor-der. Although also a best-seller, An-tifragile is the most difficult to read, opinionated and, for me, practical.
Taleb’s introduction reads, “Some things benefit from shocks; they thrive and grow when exposed to volatility, randomness, disorder, and stressors and love adventure, risk, and uncertainty. Yet, in spite of the
ubiquity of the phenomenon, there is no word for the exact opposite of fragile. Let us call it antifragile. Antifragility is beyond resilience or robustness. The resilient resists shocks and stays the same; the an-tifragile gets better.”
In one sense, you might easily summarize Antifragility as “that which does not kill us makes us stronger,” which is what Friedrich Nietzsche, the German philosopher, wrote. But notice the rest of the title—Things That Gain From Disorder.
Taleb’s concept goes an impor-tant step farther. For example, older varieties of Jack pine trees cannot re-
produce without fire. The pine cones that hold the seeds are so hard that only intense heat can open the pods to let the seeds fall to the ground to be germinated.
The forest fire that allows the trees to thrive is a perfect example of volatility, randomness, disorder, stress, risk and uncertainty. Those same words might be used by an experienced stock-market inves-tor to describe what he or she faces every trading day.
The key is that all of those factors are what provides price fluctuations and subsequent trends that create
the profitable opportunities.If the stock market is “anti-
fragile” —and it is—then must a suc-cessful investor also be antifragile? Artist Pablo Picasso once said, “Ah, good taste, what a dreadful thing! Taste is the enemy of creativeness.” In other words, artists and investors must step out beyond the conven-tional and linear way of thinking. Aren’t forest fires bad for the trees and the environment?
Taleb’s Skin in the Game argument says that a business manager who does not own the business is at first antifragile, profiting from good deci-sions and safe from bad decisions as he is not an owner. But as time goes on, he becomes “fragile,” as bad deci-sions are hidden and become critical problems later.
The stock-market “expert” fol-lows the most “fragile” path trying to calm the inherent typhoon that is the stock market. The one who wins is the one who yells, “Hit me with your best shot,” because that is how you make money.
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.
Why the sudden ringing of alarm bells about the fund’s collapse after the proposed increase in pension rates? The SSS should have looked for other sources, like improving efficiency. Rejecting the proposal outright seemed callous. There should have been a compromise, if P2,000 is too high, but definitely not a zero sum.
The forest fire that allows the trees to thrive is a perfect example of volatility, randomness, disorder, stress, risk and uncertainty. Those same words might be used by an experienced stock-market investor to describe what he or she faces every trading day. The key is that all of those factors are what provides price fluctuations and subsequent trends that create the profitable opportunities.
We can even say the rejection of House Bill 5842, which was passed by both houses of the ad-ministration-controlled Congress, was lamentable, when we consider that the 2 million or so retired work-ers from the private sector were re-ceiving a minimum of only P1,200 a month.
To make their situation all the more pitiful, many of the pension-ers—who, during their productive years, ran the country’s factories, built homes and office towers, and constructed roads and bridges to push the economy forward—are now in their twilight years, requiring not only food for subsistence but medi-cines to maintain their fragile health.
I can understand the pension fund’s, as well as the administra-tion’s, concern about maintaining
the viability of the SSS, which must always be prepared to compensate members who get sick; those who go on maternity leaves; those who need loans for education or other needs; and those who pass away, in addition to those who retire.
The proposed increase of P2,000 for each of the more than 2 million pensioners, according to the govern-ment, will result in a total payout of P56 billion a year. On the other hand, the pension fund’s invest-ment income (from which pension is paid) amounts to P30 billion to P40 billion a year, putting the SSS in deficit of P16 billion to P26 bil-lion annually. To cover the deficit, the SSS would have to tap into its investment-reserve fund until it is depleted by 2029.
I believe the pension fund’s
Tuesday, March 22, 2016
GUIMARAS province recently declared a state of calamity, after sustaining P91 million worth of agricultural damage, due to drought. With 60 percent of its rice fields parched, the
island-province is the latest addition to the list of areas worst hit by El Niño—the fairly regular warming of the Pacific Ocean—considered to be the most severe in modern history.
Water and rice
How to rob a central bank
Government officials maintain the dry spell does not imperil the country’s food security and will most likely end by May or June 2016. But the damage is still con-siderable—up to P5.32 billion in agricultural losses since February 2015, around P1.9 billion of which (or 35.7 percent) were incurred only in the last two months.
In a recent report, the United Nations Office for the Coordi-nation of Humanitarian Affairs calculated that, while Mindanao
is the one most severely hit, ac-counting for up to half of the 194,000 hectares of affected farm areas, 87 percent of its crops have no chance of recovery. And in to-tal, around 102,000 farmers have already been affected.
The government, of course, has responded, allocating some P19 bil-lion in the 2016 national budget to implement the road map President Aquino ordered last year for address-ing the adverse impacts of El Niño.
A portion will go to assisting
farmers who tide themselves over throughout the dry spell—a pressing need, especially when so many fall further into debt whenever they lose an entire harvest. The lion’s share (up to P12 billion) goes to building up the country’s ill-maintained ir-rigation system.
A recent Joint Foreign Chambers of the Philippines policy note high-lighted the country’s large irrigation gap. Despite billions already invest-ed, only 1.7 million hectares—or 57 percent of the country’s 3 mil-lion hectares of available irrigable land—actually have irrigation to-day. To bridge that gap, the National Irrigation Administration said it will need P35 billion a year, from now to 2027—a massive outlay of P350 billion.
Such a simplistic, traditional ap-proach to irrigation exacerbates the country’s already fragmented water, governance framework. Up to 30 government agencies are involved in water supply and sanitation, with not a single one empowered to coordi-nate the activities of the others. This explains why up to 70 percent of the
rainwater the country receives every year goes to waste, instead of being impounded for use during crises like the ongoing El Niño.
In 2011 I filed a Water Sector Reform Act that reorganizes the institutional setup and governance framework of the water sector. De-bates on the measure and similar water-sector reform should be re-opened, especially in light of World Water Day this March 22.
But even now, there are new and more creative solutions on offer for use and deployment. For one, con-structing water-catchment ponds for, say, every 50 hectares of rice-land, will save us ample fresh water at less cost. The Philippine Rice Re-search Institute should be funded adequately to encourage farmers to use drought-resistant seeds. And there are more innovations.
The next president should have the will and imagination to help our rural populations and develop our countr yside and coasta l communities.
E-mail: [email protected].
Conclusion
ON September 3, 1998, at least 120 delegates out of the 164 member-families of the Luisita Neighborhood Association had a dialogue with Tarlac Gov. Jose V. Yap at the Tarlac
Provincial Capitol. The families were contesting efforts to evict them from a 3,290-hectare portion of the hacienda. The allowable usage of this portion had been reclassified in 1995 from agricul-tural to commercial, industrial and residential. A fraction of this portion was to be developed into an industrial estate, the Luisita Industrial Park.
ABOUT TOWNErnesto M. Hilario
Edgardo J. Angara
The untold stories of Aquino human rights violation
The families were complaining, not just about imminent eviction, but also harassment and bribery to make them sign quitclaims or waivers of their residency rights; that they were not being permitted to repair their homes; that most of them had been retrenched or terminated from their jobs in the hacienda; and that in the baran-gays of Balete, Central and Texas, electric power was cut off, garbage collection services were stopped and the construction of toilets suspended.
The Comprehensive Agrarian Reform Program (CARP) not just brought bitterness to the families of the “workers” (formerly tenant-farmers) of Hacienda Luisita, but was also cleverly used as an excuse to generate popular pressure to strip the Marcoses and their associates of all assets under the generic category of “ill-gotten wealth.”
President Corazon C. Aquino’s Proclamation 131 created a five-year agrarian-reform fund of P50 billion to be raised partly from ill-gotten wealth received through the Presidential Commission on Good Government. To get funding for and from the CARP, peasants were, thus, expected to support the regime in its hunt for the Marcos wealth.
Worse, the Aquino administra-tion used the CARP to justify a highly reprehensible deal. This was Mrs. Aquino’s attempt to dispose of certain prime properties in Tokyo and Kobe in Japan, which were ac-quired by the Philippines, as part of Japanese reparations for the death and injuries sustained by Filipinos during the Second World War.
The foreign properties involved were a 3,179-square-meter lot on Roppongi Street in Tokyo, the 2,489.96-sq-m lot that was the site of the Philippine Chancery in Tokyo and two prime lots in Kobe.
Reacting, Mrs. Aquino’s Vice President Doy Laurel said:
“On the pretext of raising funds for the CARP, the Aquino adminis-tration, through the Asset Privati-zation Trust, decided to sell these properties through public bidding, starting with the Roppongi lot. This was accompanied by talks of a lot of money-changing hands. This was confirmed by an affidavit executed by lawyer Lupino Lazaro, which had been submitted to the Commission on Appointments.
“I immediately filed with the Supreme Court a petition for pro-hibition…. In a precedent-setting decision promulgated on July 25, 1990, the Supreme Court sustained my petition….”
No doubt, Mrs. Aquino had au-thorized the sale of the Roppongi lot to Japanese property develop-ers through Executive Order 296. As a result of the uproar that the proposed sale generated, an option to lease was initiated. But the Su-preme Court ruled that by herself and without the concurrence of Con-gress through the passage of a law, President Aquino had no authority to dispose of the reparations prop-erties through sale or lease.
The Court held the lots to be
property of the public domain and, thus inalienable, beyond the com-merce of man, and not subject to contracts. Concurring with the ma-jority, Justice Isagani Cruz wrote:
“The respondents have failed to show the President’s legal author-ity to sell the Roppongi property…. The Solicitor General was at best ambiguous, although I must add in fairness that this was not his fault. The fact is that there is no such authority. Legal expertise alone cannot conjure that statutory per-mission out of thin air…. The sale of the said property may be autho-rized only by Congress through a duly enacted statute, and there is no such law.”
“Cory had apparently become habitual in exercising dictatorial powers, while projecting herself all the time as a champion of de-mocracy. In the Roppongi case, she presumed that she had the power to dispose of property of the public dominion. When that presumption was challenged in the parliament of public opinion, she remained un-yielding until the Supreme Court overruled her,” Laurel lamented.
This is the other side of the coin, the untold story of the “holier than thou” Cory Aquino administration “hailed as saint by the Filipino people.”
A saint, whose soldiers opened fire on poor peasants and farmers fighting for genuine land reform, in broad daylight to also mention, then invoked the immunity of the state to be held liable to such atrocities.
A saint who broke her promise to the Filipinos by deliberately refus-ing to distribute any parcel of land to farmers of her sprawling hacien-da, which, aside from encompassing vast plantations tilled by the blood and sweat of peasant workers, also became home to numerous horrific killing sprees.
A saint, who, due to her vindic-tiveness, prevented the return of her archnemesis to this country, whether the man is dead or alive. That same man, albeit demonized as a tyrant and oppressor, stood firm on his order to not attack the mas-sive crowd during the Edsa revolt, and regarded the saint’s husband as a brother, even facilitating the latter’s trip to the United States to undergo a heart surgery.
If this kind of person truly quali-fies as a saint, heaven help us all.
To reach the writer, e-mail [email protected].
Poe and Cojuangco
RIGHT after the Supreme Court’s (SC) 9-6 decision declared her qualified to run for the presidency, Sen. Grace Poe and her running mate Sen. Chiz G. Escudero hied off to Quezon
province, the capital of the coconut industry in the country.
DATABASECecilio T. Arillo
There and then, the current sur-vey frontrunner and daughter of the late action king Fernando Poe Jr. defended businessman Eduardo “Danding” Cojuangco from the al-legation that he amassed a huge fortune from the imposition of the coco levy, a tax on every kilo of co-pra levied ostensibly for the benefit of the coconut planters, now num-bering some 4 million throughout the country. She herself was “getting impa-tient that coconut farmers have yet to benefit from the coco-levy funds more than four decades after they paid it,” Poe said. “But the problem is that Danding Cojuangco doesn’t control it anymore, because all the shares are now with government,” she declared.
In 2012 the Supreme Court is-sued a final ruling on the coco- levy assets, saying that 31 percent of the disputed San Miguel Corp. (SMC) shares should go to the gov-ernment for the benefit of taxpay-ers, specifically the coconut farm-ers, while the retaining 20 percent
for Cojuangco.Last year President Aquino is-
sued Executive Orders 179 and 180 privatizing the coco-levy funds, but his edicts were suspended by the SC. What this means is that after more than four decades of strug-gle for justice by millions of coco-nut farmers, they would have to wait some more, while those who amassed wealth from the blood, sweat and tears of coconut farmers are laughing all the way to the bank. During the martial-law years, Cojuangco, then-ambassador ex-traordinary and Plenipotentiary and the lone civilian member of the infamous “Rolex 12,” bought controlling stocks of the country’s largest corporation from the So-riano family and religious orders, using coconut-levy funds in a mas-terstroke of financial wizardry. Now, if we look closely at the timeline of the events of this elec-tion season, we see that days be-fore the SC handed down its con-troversial decision, the Nationalist
People’s Coalition (NPC), which everybody knows was founded by Cojuangco, endorsed the still-un-certain presidential run of Poe. Isn’t this perfect timing, consider-ing that one of the members of the SC, a recent appointee of President Aquino, was once corporate secretary of business behemoth SMC? The NPC president, Rep. Georgidi Agga-bao, boomed, as if on cue, “Tapos na ang boksing.” Before noon of Tuesday, March 8, it was all over but the shouting at the SC. The next day, the Poe-Escudero tandem was uncannily in the heartland of cocolandia, Quezon province, where farmers, many of whom had died while waiting for that precious katas ng niyog to be returned to them, were “consoled” by Poe, who openly defended the Cojuangco patriarch.
Now, nobody would believe that Poe and Escudero flew to Quezon right after her SC victory without days of planning ahead. A sortie isn’t done at a moment’s notice. It takes days, if not weeks, of advance plan-ning. Serendipitously, Poe was in Quezon, defending Cojuangco. Isn’t that quick payback? Shouldn’t all this now lead us to call Sen. Grace “Poejuangco”? This moniker is not something original. In the 2010 campaign, the Liberals tarred then-presidential candidate Manny Villar as the secret candidate of President Arroyo, giving him the moniker “Villarroyo.” History repeats itself, the first time as tragedy, and the second as farce, Marx said. Poe is no “secret”
candidate really. But then, Cojuangco is not the sitting president, unlike Arroyo in 2010, so what has he got to do with this? Well, the sitting president is Be-nigno Simeon Aquino y Cojuangco, son of Cory, who is the nephew of Tito Danding. It’s all in the family of hacienderos-turned-oligarchs con-trolling the nation’s economy.
Taiwan low-cost airline V AIR, a Taiwan low-cost carrier, will start a new service between Taipei and Manila on March 27. The carrier becomes the first Taiwan low-cost carrier venturing into the Manila market. An Airbus A320 aircraft, with a seating capacity of 180, will mainly be used on the route. Fare prices start from $65.
V Air’s Taipei-Manila service will operate four flights per week. The outbound flight ZV085 departs Taiwan Taoyuan International Airport at 5 p.m. every Tuesday, Thursday, Saturday and Sunday, and arrives at the Ninoy Aquino International Airport (Naia) at 7 p.m., local time. Then after a one-hour turnaround time, the inbound flight ZV086 departs Manila at 8 p.m., local time and arrives at Tai-wan Taoyuan at 1 p.m. (Taipei time). The inaugural flight will arrive on Sunday, March 27, at the Naia Ter-minal 1, with Dr. Gary Song-Huann Lin, Representative of the Taipei Economic and Cultural Office in the Philippines, to welcome the arrivals and invited guests.
E-mail: [email protected].
The Aquino government used the CARP to justify a highly reprehensible deal. This was President Aquino’s attempt to dispose of certain prime properties in Tokyo and Kobe in Japan, which were acquired by the Philippines as part of Japanese reparations for the death and injuries sustained by Filipinos during the Second World War.
AS brazen heists go, it was a quiet one. Over a single week-end in February, hackers
managed to extract tens of millions of dollars from Bangladesh’s central bank before anyone noticed. Now the bank is in turmoil, its governor has resigned, and much of the cash is missing. It’s one of the biggest hold-ups in history—and other central banks should be on notice.
The scheme started when intrud-ers inserted malware into Bangla-desh Bank’s system in January. With information evidently gleaned from the attack, they were able to divert funds from the bank’s account at the New York Fed using the SWIFT messaging system. Officials only wised up when the thieves tried to move an additional $850 million to suspect accounts, and a routing bank noticed a comical spelling error in one request. By then, some $81 million was long gone.
A few lessons from this strange tale suggest themselves.
First, central banks make fat targets. Many are under constant attack. Those in the developing
world, with lots of new capital but not much digital security, are es-pecially at risk. Bangladesh had amassed some $28 billion in foreign-currency reserves, and its central bank had alarmingly lax defenses. It was a hacker’s dream.
Second, fessing up quickly is crucial. Officials at Bangladesh Bank kept quiet for more than a month, and never quite got around to informing the country’s finance
minister. Meanwhile, the pilfered cash made its way across the globe. Asian governments and industries, in particular, would benefit from better information-sharing about intrusions.
A more crucial lesson is that cybersecurity, though boring, is everyone’s responsibility—even the boss’s. (“I am not a technical person,” the now ex-governor of Bangladesh Bank said, by way of
explanation.) All too often, mali-cious hacks come down to simple human error. Making better use of encryption, access controls and strong verification systems can help, but nothing can substitute for training and vigilance.
Finally, preventing hackers from moving the money they’ve siphoned off requires global cooperation. The thieves in this case laundered much of the cash through casinos in the Philippines. Not coincidentally, Filipino lawmakers have exempted casinos from antimoney-laundering requirements. Tightening those re-strictions would be wise. But there are still far too many places where lax laws, custom or generalized chaos provide a welcome home for dirty money. Changing those norms will only get more urgent.
All told, this puzzling episode should be a wake-up call. Next time, the miscreants won’t be so flagrant, greedy or orthographically chal-lenged. They’ll have plenty of en-ticing targets to choose from. And they’ll only have to get lucky once.
Bloomberg View
maintenance personnel shall be deployed to ensure 99.9999 net-work availability and reliability.”
Meanwhile, under the Oplan Ligtas Biyahe: Semana Santa 2016, subagencies are required to deploy additional personnel in airports, sea ports, bus terminals and highways. They are also mandated to set up facilities, such as public-assistance desks, first-aid stations, additional seats and charging stations. “More frequent worthiness in-spections on aircraft, ships and buses, and random drug and alcohol testing will be done to make sure that these means of transport are compliant with safety standards, and the personnel are not under the influence while conveying pas-sengers,” the transport agency said in a statement. The Manila International Air-port Authority has instructed airline companies to deploy more personnel at check-in counters for efficient processing and shortening of queues.
“Travelers are also reminded not to bring prohibited items to the air-port, and to stow all belongings in one’s carry-on baggage for faster processing at the screening check-points,” the statement read. The Civil Aeronautics Board also reminds airlines to abide by the policies under the Air Passen-ger Bill of Rights, which sets out the minimum obligations of air-lines to their passengers in case of any untoward incidents in relation to their flights.
T he L a nd Tra n s por t at ion Fra nc h is i ng a nd R eg u l ator y Board, on the other hand, has issued special permits for 832 additional provincial buses in order to meet the expected boost in passenger demand.
Meanwhile, the Toll Regulatory Board reminded expressway opera-tors to strictly implement traffic rules and regulations to avoid any untoward incidents. Roving teams will be deployed in areas where stoning incidents and
vandalism of right-of-way fences occur, and for fast response to mo-torist emergencies.
Point-to-point bus services will be suspended from March 24 to 27 to give way to preventive-maintenance works, while airport bus services will continue to run during the Holy Week, with the exception of March 25. Likewise, the operations of Light Rail Transit Lines 1 and 2, and the Metro Rail Transit Line 3 will be suspended from March 24 to 27 to allow heavy maintenance works. Operations will resume on March 28. The Philippine National Rail-ways will also suspend opera-tions from March 24 to 26, but will resume on March 27. Maritime agencies will be con-ducting rigorous security checks at port facilities and passenger ships prior to their scheduled departures. “The Philippine Coast Guard will continue patrolling the seas and be on standby for rescue operations, if necessary,” the agency said.
NTC to telcos: Ensure 99.99% network reliability
C A
A12
2ndFront PageBusinessMirror
www.businessmirror.com.ph
2Tuesday, March 22 , 2016
All necessary network adjustments and maintenance
should be undertaken to ensure that the networks are ready to accommodate the expected increase in traffic during the Lenten season.” —C
B L S. M
THE National Telecommu-nications Commission (NTC) on Monday ordered local
mobile operators to prepare for the expected surge in mobile traffic during Lent.
Also, to ensure the safety and re-liability of various modes of trans-portation during the Holy Week, the government launched a program that mandates all its subagencies to implement heightened security measures and set up facilities to ensure traveler convenience.
In a memorandum, NTC Com-missioner Gamaliel A. Cordoba ordered telcos to continue offer-ing their “unlimited” services even during the holidays, and “ensure uninterrupted telecommunications
services during the Lenten season.”The two largest telecommuni-
cations companies in the Philip-pines previously barred custom-ers from availing themselves of the service, prompting a congres-sional hearing a few years ago.
“All necessary network adjust-ments and maintenance should be undertaken to ensure that the networks are ready to accommo-date the expected increase in traf-fic during the Lenten season,” he said. “Sufficient operations and
around Natuna, in response to China’s growing military presence in the disputed South China Sea (SCS).
So far, though Indonesia has largely avoided being caught up in the SCS tensions, which have seen China’s relations deteriorate with
the Philippines and Vietnam, even as economic ties remain strong. Indeed, Marsudi stressed in the statement to China that Indone-sia is not a claimant in the waters, Antara reported.
Chinese passportsON March 19, a Chinese fishing boat in the country’s conventional
fishing waters was attacked and harassed by armed Indonesian ves-sels, and a coast guard ship went to its aid, China’s Foreign Ministry said in a statement carried on the Global Times web site. “The Chinese side urges the Indonesian side to immediately release the fishermen being captured and to assure their safety,” it said.
China claims more than 80 per-cent of the SCS, one of the world’s busiest waterways, based on a so-called nine dash line for which it won’t give precise coordinates, and has undertaken large-scale land reclamation in the area to enable airstrips and other features to be built. In passports issued in 2012, China’s line encroached on the ex-
clusive economic zone that Indo-nesia derives from the Natuna is-lands. Indonesia hasn’t recognized the claim. “Natuna belongs to Indonesia, it is very crystal clear that Natuna belongs to Indonesia,” Marsudi told Bloomberg in an interview on Friday. “I would like to emphasize that Indonesian sovereignty over
Natuna is very clear and recognized by China, as well.” The Asean needs to press on with talks for a code of conduct for the SCS, she said. One of the Indonesian government’s main foreign policy objectives was to re-solve maritime territorial disputes with its neighbors, Marsudi said.
Bloomberg News
Indonesia detains Chinese fishermen after SCS chase
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