B C U. O

BACOLOD CITY—The Insurance Commission (IC) is seeking Mala- cañang’s approval for the issuance

of an executive fiat establishing an insurance fund that protects homeowners and small and medium enterprises (SMEs) from the ill effects of nature-induced calamities or disasters.  This was according to Insurance Commissioner Emmanuel F. Dooc, who, at the sidelines of the Asia-Pa-cific Economic Cooperation (Apec) Meeting on Disaster Risk Finance, told financial reporters of the plan to throw a blanket of protection over uninsured households and small businesses. 

Dooc said the insurance fund was first proposed by the Philippine

Insurers and Reinsurers Asso-ciation (Pira) in tandem with the World Bank and the International Finance Corp.  “One feature is that we will only be requiring an executive order [EO] to fast-track the launch of this disaster-insurance pool,” Dooc said.   “Of course, we would love to get congressional approval for this, but

B J R. S J

NEWLY appointed Customs Commissioner Alberto D. Lina on Wednesday gave

hints that a major reshuffle is in the offing at the Bureau of Customs (BOC), as part of his promise to con-tinue the reforms that his predeces-sor had instituted to improve collec-tions and end smuggling activities.

This came after Deputy Com-missioner Primo B. Aguas report-edly resigned as head of the Man-

agement Information Systems and Technology Group. A BOC source said Aguas resigned on April 20, the day former Commissioner John P. Sevilla announced in a news con-ference that he was resigning.  “Depcom Primo Aguas’s last day is today. But his resignation is not related to Commissioner Sunny Sevilla’s resignation,” the source said. 

Aside from Aguas, it was also reported that Deputy Commis-sioner Edita Z. Tan, who heads

the agency’s Revenue Collection and Monitoring Group, is consid-ering leaving the BOC following Sevilla’s resignation. Both Tan and Aguas belong to the so-called reformists at the BOC.  Lina told reporters that the per-formance review of all Customs port collectors and other personnel of the BOC is now ongoing. “That is always a possibility be-cause even in other agencies, you can’t stay in your position for three

www.businessmirror.com.ph ■�TfridayNovember 18, 2014 Vol. 10 No. 40 P. | | 7 DAYS A WEEK■�Thursday, April 30, 2015 Vol. 10 No. 203

A broader look at today’s businessBusinessMirrorBusinessMirrorTHREETIME

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

ROTARY CLUB

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PESO EXCHANGE RATES ■ US 44.2590 ■ JAPAN 0.3724 ■ UK 67.8889 ■ HK 5.7108 ■ CHINA 7.1320 ■ SINGAPORE 33.6289 ■ AUSTRALIA 33.6289 ■ EU 48.6008 ■ SAUDI ARABIA 11.8027 Source: BSP (29 April 2015)

Reshuffle in the offing at BOCas more officials set to resign

AYALA LAND TO RAISEP13B MORE VIA DEBT

B VG C

PROPERTY developer Ayala Land Inc. said it will still tap the debt market this year to

raise as much as P13 billion more, although it has not decided yet if it will go straight to the bank for a loan or conduct another bond issuance.

Ayala Land on Wednesday listed its P7-billion fixed-rate bonds at the Philippine Dealing & Exchange Corp. The paper, maturing in 2022, carries a yield of 4.5 percent. “We have said that we will raise about P15 billion to P20 billion this year. So this is P7 billion of what we plan to raise through debt. Whether we go to the capital mar-kets or the debt markets is some-thing we have to evaluate, or we will just do bilateral with the banks is something we will look at,” Bernard

Vincent Dy, the company’s presi-dent and CEO, said at the sidelines of the company’s bond listing.

Investors continue to show strong interest in Ayala Land’s bond, as its latest issuance was more than two times oversubscribed.

The fund-raising activity will partially cover the P100 billion in capital expenditures that Ayala Land allocated this year for its vari-ous projects across the country. Ayala Land, the country ’s second-largest developer, ear-lier announced that it will be spending about P12 billion to develop a 9-hectare property in Aseana City, adjacent to the City of Dreams Manila.

The mixed-use development will have mall, hotel and office components. The construction is

Disaster-insurance EO in the worksINSIDE

LIVING A WELL-

TRAVELEDLIFE

D1

Life � ursday, April 30, 2015

Life BusinessMirror

Life Editor: Gerard S. Ramos • lifestylebusinessmirror@gmail.com

DEAR Lord, Your first appearances to Your disciples, You gave them numerous signs and proofs of Your resurrection: Your visible and proofs of Your resurrection: Your visible

apparitions; Your invitations to touch Your body and especially Your wounds. And all this, in order to and especially Your wounds. And all this, in order to strengthen their faith and increase their joy. Even today, strengthen their faith and increase their joy. Even today, You have many signs in our daily lives to show Your love You have many signs in our daily lives to show Your love and mercy. Amen.

Numeroussigns and proofs

EXPLOPING GOD’S WORD, FR. SA, PUTZU, SDB AND LOUIE M. LACSONEXPLOPING GOD’S WORD, FR. SA, PUTZU, SDB AND LOUIE M. LACSONWord&Life Publications • teacherlouie1965@yahoo.comteacherlouie1965@yahoo.com

‘STAGES’: JOSH GROBAN

DELIVERS JOSH GROBAN

DELIVERS JOSH GROBAN

THEATRICALLY »D2

B JT N

EVER noticed how every list, every map and every key that claims to lead to “happiness” includes “travel”?

Given the inclusion of the travel variable in these run-downs, it would

seem that it is a necessary part of the happiness equation, a prerequisite to a brighter life. As Cathay Pacific Country Manager Alan Lui said in a statement, “A life well-traveled is a life well-lived.”

In line with this and as part of its global campaign this year, Cathay Pacific recently launched its “Life Well Travelled” promotion locally at The Peninsula Manila.

The campaign (www.lifewelltravelled.cathay pacific.com) centers on testimonies of Cathay Pacific’s frequent flyers on how Hong Kong’s flag carrier elevates their travel experience from mere transportation to an enjoyable journey. “Every travel story is an inspiration, and every new journey is a story waiting to be told,” Lui said.

From “designing the product around passenger needs,” such as the inclusion of the hottest movies and TV series in their in-flight entertainment offerings, to “investing a lot on the people” who can offer passengers unparalleled flight service, Lui said they continue to find ways to make their passengers’ journey with them memorable. “We spend most of our time thinking of ways to create wonderful experiences for each and every person who flies with us, because we know that travel is as much the journey as the destination.”

One flyer who shared his experience with the airline was Kesler Go, a businessman, saying, “Once you step onboard, it’s like meeting old friends. It always feels more genuine with Cathay Pacific.” Another was quite an interesting passenger, 10-year-old Enzo Salas who, at his young age, has developed deep affinity with Cathay. “I collect the small things like boarding passes, menu cards and bag tags because they remind me of the bigger parts of the journey.”

Also participating in the Life Well Travelled campaign are some of today’s key “influencers,” such as professional basketball player/businessman Chris Tiu, celebrity stylist Liz Uy and fashion columnist/mother Amina Aranaz-Alunan, who all shared their testimonies

during the launch. According to Tiu, what makes journeys with Cathay

memorable begin not mid-flight but on the ground. “It’s not just the transportation from point A to point B,” the 29-year-old cager said. “It’s the entire package from the booking to the check-in to the lounge experience to the in-flight service—it’s the entire travel experience [which equates to a good journey and ultimately, a life well-traveled.]”

For Liz, her concept of a life well-traveled is taking in new experiences by stepping out of one’s comfort zone and, in the process, broadening one’s mind to enjoy all that life has to offer. She said she achieves this with Cathay Pacific, because she is “reassured of comfort, safety and great service” on top of cheap thrills such as the chance to catch-up on the latest movies in-flight and the luxury to arrive at her destinations well-rested through the airline’s quality service.

As for Aranaz-Alunan, a life well-traveled always

includes quality journeys, not just destinations, that’s why she always flies Cathay Pacific. She added that trips are not just about experiencing the sights and sounds of a place but rather, an opportunity to learn a valuable life lesson. “It’s really about the experience from planning the trip, deciding where to go, the decision-making of where to stay, how many days are you budgeting. It starts with the preparation. It’s an entire life lesson that goes with travel.”

According to Lui, aside from their newcampaign, this year is particularly an excitingtime to fly with Cathay Pacific as they move to Ninoy Aquino International Airport Terminal 3 with their own topnotch lounge and the opening of new destinations, such as Newark, Manchester, Zurich, Boston and Düsseldorf. ■

CATHAYPacific Country Manager Alan Lui (fourth from left) with Cathay Pacific frequent flyers fashion columnist/mother Amina Aranaz-Alunan (third from left), professional basketball player/businessman Chris Tiu and celebrity stylist Liz Uy (fifth from left), with two representatives from the carrier’s crew.

Living a well-traveled life

EACH cottage at Upper House Village in Baguio can accommodate groups of 10 to 14 persons comfortably with five bedrooms each. Daily housekeeping services are offered.

➜Living the dream upin the mountainsFINALLY, the wait is over. At Upper House Village (www.upperhousebaguio.com), you can enjoy the comforts of a private upperhousebaguio.com), you can enjoy the comforts of a private upperhousebaguio.comhouse in Baguio City—the City of Pines and the summer capital of the Philippines—without the headaches of owning and maintaining a va cation home. What makes it even more inviting, the travel time from Manila is now a mere 4.5-hour drive with the opening of the new Tarlac-Pangasinan-La Union Expressway. How’s that for an easy-breezy vacation?

Managed by Baguio-based hotelier Heiner Maulbecker, this exclusive and private highland retreat is located in the preferred part of town between Baguio Country Club and Camp John Hay. It features 12 charming well-appointed cottages that can house families or groups 10 to 14 persons. Each residence is fully furnished, spacious, modern and designed to blend seamlessly with the surrounding scenic and restful landscape.

Surrounded by lush greenery and majestic pine trees, each luxurious cottage boasts of five bedrooms, each with a private bathroom, an attic lounge and playroom, plus a well-equipped kitchen with cooktop and refrigerator for those who enjoy home cooking. Other features include a dining room with a fireplace, spacious outdoor porches and balconies, maid’s and driver’s quarters with a separate bathroom, and a two-car garage.

Other conveniences to make your stay exceptional include cable TV, DVD player, three LED TV sets, 24-hour free Wi-Fi, and an emergency backup generator. Food, snacks, coffee and refreshments may be ordered from the Village Shop, with prior notice. Daily housekeeping services are also available by request.

Your next vacation doesn’t have to be like everybody else’—and now up in the mountains, amid centuries-old pine trees and the most delicious climate, you can enjoy a different kind of summer getaway.

BANGKOK, Thailand—By 2030 more than 1.8 billion of us will travel internationally every year, and what motivates us, as well as how we behave will be radically different to today.

By the end of the next decade, some people will purchase and consume travel experiences almost entirely on the basis of how shareable they are, or how much “capital” they generate, via social networks. Another group of travelers will demand total simplicity and freedom from having to arrange their own travel by 2030, wanting as much as possible to be done remotely, by third parties. At the same time, a dedicated group will emerge with a desire for only the most hedonistic, indulgent and must-have experiences.

These are just some of the forecasts made in “Future Traveler Tribes 2030: Understanding Tomorrow’s Traveler,” a major new report launched recently identifying the different traveler personalities and segments the industry can expect to emerge and become prominent over the next fifteen years. The report can be downloaded at www.amadeus.com/tribes2030.

The research process involved interviews and workshops with industry experts, as well as trend-spotting research with consumers

in the relevant travel markets, including Australia, China, India, Indonesia, Japan and South Korea. Taking a psychographic rather than demographic approach, the report draws on Future Foundation’s proprietary consumer research forecasts to identify the six distinct traveler personalities as:

■ Social capital seekers will structure their holidays almost exclusively with online audiences in mind, relying heavily on peer reviews and recommendations to validate their decisions. A whole new market may open up based on “profile-boosting breaks,” filled with consciously feed-friendly moments

■ Cultural purists will look Cultural purists will look Cultural puristsat holiday-making as a chance to immerse oneself in an alien—even uncomfortably so—culture, where enjoyment of the break depends on the authenticity of the experience.

■ Ethical travelers will make travel plans based on moral grounds, for example, decreasing their carbon footprint or improving the lives of others. They will often improvise or add some element of volunteering, community development or eco-sustainable activity to their holidays.

■ Simplicity searcherswill prefer bundled offers,seeking to avoid managing too many trip details themselves. Holidays for this tribe represent a

rare time in life to pamper oneself with the assurance of their safety and enjoyment.

■ Obligation meeters will be driven by a specific purpose for travel, whether business or leisure, and thus, have constraints on time and budget; they will seek smart algorithm based technology that is able to remove the hassle of travel.

■ Reward hunters are only interested in indulgent travel. Many have come to crave something that represents an extraordinary reward or “must have” premium experience, a return on their hard-earned investment of time and energy in their working lives.

“The traveler today has more power than ever before. They are increasingly complex, empowered, and no longer want to be siloed into demographic groups of age, nationality and income. By 2030 hyper-customisation will be the default expectation among many customers. With Asia Pacific set to lead global travel growth through to 2030, it is particularly critical for all providers, buyers and sellers of travel in the region to truly un-derstand these emerging ‘traveler tribes’ and make the right invest-ment decisions now to gear toward future traveler preferences,” com-mented Angel Gallego, president, Amadeus Asia Pacific.

Are you a ‘simplicity searcher’or a ‘social capital seeker’? New study reveals how and why we will travel by 2030

JOSH GROBAN

THEATRICALLY

LIFE D1

RELAX!C | T, A ,

mirror_sports@yahoo.com.phsports@businessmirror.com.ph

Editor: Jun Lomibao

SportsBusinessMirror

LAS VEGAS—Floyd Mayweather Jr. is the bigger man. There’s a good chance he could be the quicker man.

Those are qualities that win fights, and those are advantages Mayweather brings into Saturday’s welter-weight title showdown with Manny Pacquiao. He also comes in with the confidence that comes in knowing he’s beaten every man—all 47 of them—he’s stepped into the ring with since turning pro as a scrawny 130-pounder 19 years ago.

Yes,  Pacquiao  could easily be the toughest test of his career so far. The Filipino poses problems for Mayweather not only because he is a southpaw, but because he fights in spurts and at odd angles.

There’s a good chance Pacquiao will start fast and win some early rounds. His trainer, Freddie Roach, is the best in the business today and has put together a fight plan that will allow Pacquiao to do just that.

Like a good chess match, though, this will be a fight about adjustments. And that will be where Mayweather will really earn his $180 million.

“I’ve always got the remedy to solve the problem and come out on top,” Mayweather said. “I don’t know if he can make adjustments. I’ve always been able to make

adjustments.” Indeed, Mayweather has an uncanny knack of being able to figure opponents out, whether in mid-round or mid-fight. If something isn’t working on any particular night, he switches to something else, and then adjusts that if needed.

Mayweather showed that in his 2010 fight with Shane Mosley, when he started slowly and had his knees buckled by a Mosley right hand in the second round. Mosley landed another right later in that round, but Mayweather figured things out and dominated every round after that on his way to an easy decision win.

Three years earlier, Mayweather lost most of the early rounds to Oscar De La Hoya only to take control and sweep the later rounds in the fight that made him a pay-per-view star.

Pacquiao  might be more difficult than most to solve, but don’t sell Mayweather short. He’s beaten all eight southpaws he’s faced in his career, including Zab Judah in 2006 in another fight he had trouble in early rounds only to dominate late.

“He comes at different angles so we’ll just have to see,” Mayweather said. “I just know he will be facing a solid, strong welterweight.”

The size differential between the two men was noticeable when they got together in Los Angeles in March to promote the bout. Mayweather was struck by it, saying later he would have towered over  Pac-quiao  even more if  Pacquiao  hadn’t put lifts in his shoes to look taller.

That’s different for Mayweather, who in many of his recent fights faced fighters who rehydrated so much after the weigh-in that they were 15 pounds heavier than he was. That won’t be the case against Pacquiao, who struggles just to get to the 147-pound weight limit.

If there’s a knock against Mayweather it’s that he’s lost a step at the age of 38 and can no longer count on his elusive defense to carry the night for him. He must engage more, and trade punches, something that could play intoPacquiao’s hands.

“If he wants to fight me, good for me,”  Pac-quiao  said  on Tuesday. “If he’s running and moving around the ring, we’re prepared for that, too.”

Mayweather will also have difficulty using his shoul-der roll to full advantage when playing defense because a southpaw can punch around it from the other side.

This could be a fight with far more action than

a normal Mayweather bout. Mayweather may try to impose his will, with his size carrying the day.

“Floyd Mayweather is going to try to take Manny  Pacquiao’s  head off, you can count on that,” Mayweather’s promoter, Leonard Ellerbe said. “Floyd Mayweather is looking to finish him off.”

Mayweather has always been a thinking man’s fighter, calculating his moves well ahead of time so he can stay one move ahead of whoever is in the ring with him. He believes Pacquiao is a reckless fighter who will

make a reckless mistake, much like he did when he was knocked out with one punch by Juan Manuel Marquez in their last fight.

So far, Mayweather has been right 47 times. Forty seven times he stood in the ring after a fight, with his hand raised.

It will happen again in the richest fight ever, on a night when Mayweather’s legacy is finally secured.

“I’ve never wanted to win a fight so bad in my life,” he said. AP

B T D� e Associated Press

LAS VEGAS—Manny  Pacquiao  worried about the punching power of Miguel Cotto. He knew Juan Manuel Marquez was a slick counter puncher, and wondered how he’d fare against a fighter the caliber of Oscar de la

Hoya. He’s got no such worries about Floyd Mayweather Jr. on the eve of boxing’s richest fight ever.

“I cannot say he is that difficult an opponent,” Pac-quiao  said  on Tuesdayquiao  said  on Tuesdayquiao  said . “My confidence right now is   on Tuesday. “My confidence right now is   on Tuesdaydifferent than the other fights I had. I feel excited, this is it. I have to prove something.”

Just hours after arriving in this boxing capital in a motorhome from Los Angeles, Pacquiao  oozed confidence at a rally attended by about 1,000 people at the Mandalay Bay hotel. The mostly Filipino crowd watched Pacquiao’s latest music video and was enter-tained by dancers and singers before the fighter himself made a brief appearance.

“I know I’m going to win the fight in the ring,” Pac-quiao told the crowd. “So relax.”

Oddsmakers aren’t so convinced, with Pacquiao re-maining about a 2-1 underdog for a fight expected to earn him more than $100 million. But Pacquiao didn’t even have to break a sweat to win over the crowd that came to the hastily arranged pep rally in a convention area at the hotel.

“You’re excited,” Pacquiao said to the cheering crowd. “I’m very excited.”

Mayweather was greeted by a much bigger crowd at the MGM Grand hotel, where Saturday’s night welter-weight title fight will play out. The Southern University marching band entertained and a mariachi band played outside before Mayweather arrived 20 minutes early.

For many, it was their only chance to see the two fighters without reaching deep in their pockets. Tickets for the fight itself were being offered online starting at $3,800 and going over $100,000 near ringside, while even the $10 tickets for Friday’s even the $10 tickets for Friday’s even the $10 tickets for weigh-in were being offered for $100 or more.

“Five years ago this was a $50-million fight for me and $20 million for him,” said Mayweather, who is ex-pected to make $180 million or more to $120 million forPacquiao’s camp.

With the real work already done, both fighters were going over game plans for a bout that was five years

in the making. Pacquiao said he had two or three dif-ferent strategies for the fight, depending on whether Mayweather wants to try to win with his defense or comes out attacking.

“If he wants to fight me, good for me,” Pacquiao said. “If he’s running and moving around the ring we’re pre-pared for that, too.”

Mayweather said that Pacquiao will be trying the same game plan that 47 others have failed to implement.

“Everybody’s game plan is to come forward and throw lots of punches,” Mayweather said. “It hasn’t worked in 19 years and 47 fights.”

It didn’t work for de la Hoya, who lost to both men while helping make them the pay-per-view stars they are today. Pacquiao’s trainer, Freddie Roach, was in de la Hoya’s corner in 2007, when de la Hoya won most of the early rounds before fading and dropping a decision to Mayweather.

It’s a fight Roach believes de la Hoya could have won had he kept jabbing. More important, Roach said it was a fight he learned a lot about how to take on Mayweather.

“I really did learn from the Oscar fight. It was a good lesson to me,” Roach said. “Floyd is tricky but not very complicated. But if you get behind him and start following him around the ring he will set a trap. I have trained Manny not to let that happen. When he sets a

trap, Manny will walk away.”De la Hoya said his head tells him Mayweather will

win the fight, but his heart is with Pacquiao. He said the Filipino has an advantage with Roach in the cor-ner, and will have a strategy to counter Mayweather’s defensive moves.

“I believe this fight is going to be more exciting today than five years ago because both guys are not as agile on their feet,” de la Hoya said. “Mayweather has lost a step or two with his legs and so has Pacquiao. Pacquiao will have a chance to connect a few punches on Mayweather and vice versa.”

What he doesn’t want to see, de la Hoya said, is May-weather fighting just to win the fight. That strategy has helped Mayweather win all 47 of his fights, but fans are often unenthused about his performances because he thinks safety first.

In the most anticipated fight in recent times, that is not enough to stand the test of history, de la Hoya said.

“It’s sometimes unfortunate that his mentality is I’m undefeated and I’m going to think I’m the greatest because nobody has beaten me,” he said. “It just doesn’t work that way. You have to dare to be great and when you are to be great you’re going to face the toughest challenges. People are going to see that and people are going to respect that.”

BIGGER AND QUICKER?

RELAX!WILL Floyd Mayweather Jr. be a step ahead on Sunday? AP

MANNY PACQUIAO oozes with confidence at a rally attended by about 1,000 people at the Mandalay Bay hotel. AP

MANNY PACQUIAO:I CANNOT SAY FLOYD MAYWEATHER JR. IS THAT DIFFICULT AN OPPONENT.MY CONFIDENCE RIGHT NOW IS DIFFERENT THAN THE OTHER FIGHTS I HAD. I FEEL EXCITED, THIS IS IT. I HAVE TO PROVE SOMETHING.

SPORTS C1

I.C., BTr RUSHING EXECUTIVE ORDER GIVING HOMEOWNERS, SMEs INSURANCE COVER AGAINST CALAMITIES

HEALTH&FITNESS

LIFETIME ACHIEVEMENT AWARD ALC Group of Companies Chairman Emeritus Ambassador Antonio L. Cabangon Chua (center) receives this year’s Kapisanan ng mga Brodkaster ng Pilipinas (KBP) Lifetime Achievement Award during the 23rd Golden Dove Awards Night held in Pasay City. The award is given to senior individuals who have held key positions in the broadcast media or in related fields and have significantly contributed to the advancement of the broadcast media, and consistently demonstrated high standards of excellence and professionalism in his or her work. Presenting the award are (from left) KBP Board of Trustees Progressive Broadcasting Corp. President Alfredo Henares; Bombo Radyo Phils. VP/COO-AM Division Herman Basbaño; Manila Broadcasting Co. President Roberto J. Nicdao Jr.; Radio Veritas Global Broadcasting System Administrative Head Fr. Manuel Bongayan, SVD; ABS-CBN Corp. Integrated Sports Head Dino Jacinto Laurena; and Radio Corp. of the Philippines EVP and COO Francis Cardona. See story on A8. ALYSA SALEN

S “A,” A

C A

S “BOC,” A

BusinessMirror news@businessmirror.com.ph Thursday, April 30, 2015A2

News

BOC. . . Continued from A1

‘BM’ founder. . . Continued from A8

Inflation. . . Continued from A8

Ayala. . . Continued from A1

Continued from A1set to start this year or early next year. It is expected to be bigger than the neighboring SM Mall of Asia, which measures about 407,000 square meters. “We won’t know the exact budget until we finished the plan-ning. But obviously [at] 9 hectares, it will be a very sizable mixed-used. We already indicated that there’s going to be a shopping center, there’s going to be an office, as well as hotel,” he said. Ayala Land’s net income rose 26 percent last year as a result of the robust performance of all its units from residential to office to mall operations. The company said in a statement its income reached P14.8 billion in 2014, some 26 percent higher than the previous year’s already record profit of P11.74 billion. Last year’s rate of growth, how-ever, was slower than the previ-ous year’s 30-percent increase in its net income and 36 percent for its revenues. Consolidated revenues reached P95.2 billion, 17 percent higher than the previous year’s P81.52 billion. “Moving forward, we will con-tinue to introduce new residential projects and scale up our commer-cial leasing operations in support of our 2020 Vision,” Dy said. The vision points to the com-pany’s profits growing by an aver-age of 20 percent every year, with the end goal of reaching P40 bil-lion in net income by year 2020, or more than triple its profit from

years. Even in the private sector, for internal control purposes, the people are being reshuffled, maybe even in the media,” Lina said when asked about the possibility of a re-shuffling of BOC personnel.  A mong the BOC off ic ia ls whose qualifications and per-formance are being evaluated is lawyer Teddy Raval, head of the BOC’s Intellectual Property Rights Division. Lina said Raval’s transfer to the Enforcement and Security Service would depend on the outcome of the

ongoing assessment of his qualifi-cations.  “If he is qualified to the post why not?  He is a lawyer. There is a committee that is reviewing that,” Lina said.

Lina to divest stakes in 6 firmsMEAnWHILE, to quell the is-sue of conflict of interest raised against him, Lina announced that he would be divesting his shares in six firms within the 60-day period prescribed under the law. “I resigned from all my positions

as chairman, even those which are not dealing with the BOC,” he said. Lina was referring to the Lina Group of Companies, which he chairs, such as logistics firm Air21, U-Freight Inc., E-Konek, U-Ocean Inc., LGC Logistics and 2100 Cus-toms Brokers. He added that he will also step down as independent director of the Philippine Airlines. Lina said his wife and children will also divest their interest in companies dealing with the BOC as required under the law. 

El niño, according to the Phil-ippine Atmospheric, Geophysical and Astronomical Services Admin-istration, can also cause tropical cyclones to behave more erratically and at higher intensities and that these are developments potential-ly inf luencing where the economy was headed. Electricity rates were also seen rising in the coming months just as the power shortage is at its worst and demand for electricity is at optimum. “The possibility of power outages could raise generation prices. Reports suggest that the country has thin power reserves and outages could oc-cur during peak times in the summer months of 2015,” the BSP said. “Should the outages material-ize, production costs would likely

increase, potentially resulting in manufacturing delays. These could cause inflationary pressures,” the central bank added. Aside from these two events poten-tially causing inflation to tick upward, the BSP similarly said a sharp rebound in oil prices cannot be fully discounted given the sizable uncertainty of how supply responds to prices. Against this background, the BSP nevertheless remained confident that inflation should continue to fall within the 2-percent to 4-percent target range over the next two years. April inflation data is set for re-lease by the Philippines Statistics Authority next week. Inflation av-eraged 2.4 percent in the first quar-ter or well within the government target for 2015.

Disaster-insurance EO in the workswe know that political realities, next year is an election year, we doubt very much if this will be ap-proved by Congress in due time,” he added.  Under the Pira proposal, the fund will provide mandatory cover over small residential units and SME establihments to secure them against earthquake, fire, typhoon and the risk of flooding. Dooc said the IC and Bureau of the Treasury (BTr) are now re-viewing the proposal and are in the process of crafting their own version of the insurance fund. The two versions will then be presented to Finance Secretary Cesar V. Puri-sima for approval or refinement soon after. 

However, Dooc said a possible feature of the fund is a cap on the basic cover of around P1 million for each policy written. He said small residential owners residing in slum areas will not be covered because their housing units are not insurable. The insurance commissioner also said making the insurance cover compulsory and bundling it with the real-estate tax paid to the local government units should help boost the likelihood of success and adop-tion of the program. “We were ordered, together with the Bureau of the Treasury, to review [the Pira proposal] and come up with our suggestion. It’s currently pending with the Bureau of the Treasury. But I expect that it will soon be forwarded to the sec-retary offinance,” Dooc explained. 

He said one of the reasons for the proposed fund was the recent devastation wrought by Supertyphoon Yolanda in Taclo-ban where thousands lost their homes and livelihoods.  Some of these victims were cov-ered by some form of microinsur-ance, with the total benefits at P500 million, or an average of P10,000 per low-income borrower.  Dooc said while the amount was not that big, it was significant con-sidering that the total premium of these microinsurance policies only reached a few hundred pesos.  “Insurance benefits are not dole outs that impair dignity of those who receive them. Benefits from premiums are derived from honest labor, preserving one’s honor and dignity,” Dooc said.

word would be “prestigious.” “This is be-cause the recognition comes from those who really know what broadcasting is about. Simply being nominated is consid-ered a badge of honor,” Nicdao said in his speech. Cabangon Chua recently expand-ed his media organization by acquiring a key stake in Nine Media Corp. and RPN9, which now forms the local franchise of Cable News Network (CNN). CNN Philip-pines aired its maiden broadcast in March. But Cabangon Chua’s biggest contri-bution to the media industry yet is his advocacy to bring back media’s role in delivering useful, meaningful and unbi-ased information to help Filipinos grow

as a nation. This advocacy is the rationale behind the Catholic Mass Media Awards (CMMA), the award-giving body of the Archdiocese of Manila that encourages the media to uphold Christian values and positive Filipino traditions through their work. With Cabangon Chua as president and chairman of its board of trustees, the CMMA has become one of the most prestigious awards given to journalists. The KBP also conferred a Lifetime Achievement Award to Larry Henares of the Progressive Broadcasting Corp., while Luchi Cruz-Valdes of TV5 was conferred the Ka Doroy Broadcaster of the Year Award for 2014.

news@businessmirror.com.ph Editor: Dionisio L. Pelayo • Thursday, April 30, 2015 A3BusinessMirrorThe Nation

De Lima made the announce-ment after recounting the efforts of the government to convince the Indonesian government at the last minute to grant Veloso a reprieve from execution. Veloso was supposed to be exe- cuted shortly after midnight on Wednesday but Philippine govern-ment officials invoked the Associa-tion of Southeast Asian Nations-Mutual Legal Assistance Treaty (MLAT) in buying time for her. De Lima told reporters that she ad-vised President Aquino to appeal for a temporary reprieve of Veloso dur-ing his meeting Indonesian President Joko Widodo at the 26th Association of Southeast Asian Nations (Asean) summit in Kuala Lumpur, Malaysia.

She said she told the President that a reprieve is necessary in light of the surrender of Veloso’s alleged recruiter Maria Kristina Sergio the other day to police authorities in Nueva Ecija. Sergio, along with her live-in part-ner Julius Lacanilao and an African named “Ike” are now facing a crimi-nal complaint of illegal recruitment, human trafficking and estafa filed by Veloso through the National Bureau of Investigation’s (NBI) Anti Human Trafficking Division. The Department of Justice (DOJ) is set conduct a preliminary inves-tigation on the case on May 8. “Sabi ko sa President na hindi na uusad ang kaso kapag nawala siya [Veloso]. I advised him that the best

Task force to probe Veloso’s human-trafficking claimtact po ngayon is to target temporary reprieve by invoking the Asean-MLAT. I-invoke that para makakuha pa ng mga information and further testimonies from Mary Jane herself and sa kaso dun sa Malaysia kung saan doon inabot umano ang luggage,” de Lima said. De Lima added that the Philip-pine authorities can also invoke the Asean-MLAT to seek assistance from Malaysian government in getting more information in connection with Veloso’s case. “Ang magiging suma total nito na kapag na-validate ang kanyang sinasabi through additional evi-dence and resulta ng preliminary investigation, then that would be good for Mary Jane. Baka meron pang ibang remedyo para sa kanya para masalba siya from death sen-tence,” de Lima said. Meanwhile, de Lima added that the joint task force will be composed of prosecutors, investigators from the NBI and lawyers to be headed by Justice Undesecretary Jose Vicente Salazar whose primarily function is to gather more evidence to back Ve-loso’s claim that she was a victim of human trafficking. A Roman Catholic Church official on Wednesday said the ball is now in the government’s hands to prosecute the recruiters of Veloso who allegedly duped her into transporting drugs to Indonesia where she was nabbed and sentenced to death. Bishop Ruperto Santos of Bal-anga said the temporary reprieve

will give more time for the govern-ment to save Veloso. “So that justice may be served and the innocence of Mary Jane may finally be established, let those who victimized her be prosecuted,” said Santos, head of the Catholic Bish-ops’ Conference of the Philippines Commission for the Pastoral Care of Migrants and Itinerant People, in an article posted on the church web site. Following the temporary re-prieve given by the government of Indonesia to Veloso, two party-list lawmakers are pushing for a mea-sure providing legal assistance for overseas Filipino workers (OFWs)

facing charges abroad. Party-list Reps. Neri Colmenares and Carlos Zarate of Bayan Muna, in a news conference, said that their bill will be filed to counter President Aquino’s veto on legal assistance fund for migrant Filipino workers. “We are now drafting a bill for a P500-million supplemental budget for 2015 to counter President Aqui-no’s veto of the legal assistance fund for OFWs,” Colmenares said. Earlier, Sen. Nancy Binay has pushed for additional funding for the Department of Foreign Affairs’s legal assistance to P100 million from P30 million during the de-liberations on the 2015 national

budget last year. The lawmakers were referring to a veto message from President Aquino dated December 23, 2014, that was attached in the enacted General Ap-propriations Act of 2015. The veto message said that the implementation of the OFW Legal Assistance Fund must be aligned with the laws and regulations gov-erning the Department of Budget and Management. Vice President Jejomar C. Binay thanked Indonesian President Joko Widodo on Wednesday for postpon-ing the execution of Filipino drug con-vict Veloso. With Claudeth Mocon-Ciriaco, Jovee Marie dela Cruz, Recto Mercene and Marvyn Benaning

By Joel R. San Juan

JUSTICE Secretary Leila de Lima on Wednesday announced the creation of a joint task force that

would gather more information and evidence to validate the claim of Mary Jane Veloso that she was a victim of human trafficking and was duped into carrying more than 2 kilos of heroin into Indonesia in 2010.

Transco has been assigned as the FIT allowance fund ad-ministrator. PEMC, for its part, is the collection agent tasked to remit to the FIT allowance fund the WESM proceeds as the Actual Cost Recovery Revenue (ACRR) of FIT-Eligible Renew-able Energy Plants operating in a grid where the WESM is operational. It can be recalled that the Energy Regulatory Commission (ERC) issued in December last year Resolution 14, Series of 2013, adopting the Guidelines

on the Collection FIT Allowance. In accordance with the pur-poses of the WESM rules to en-courage the use of renewable sources of energy, PEMC has been coordinating with Transco and WESM participants to en-sure seamless implementation of the collection and remittance procedures provided in the FIT Allowance Guidelines issued by the ERC. “We at Transco have been re-lentless in our effort to ensure information dissemination so that we are able to elicit the

BusinessMirror news@businessmirror.com.ph A4

Economy

briefspalace plays down looming

cabinet revampMalacañang on Wednesday played down talks, but did not rule out, a looming cabinet revamp as other top-level officials in President aquino’s inner circle are said to follow Energy Secretary carlos Jericho l. Petilla who resigned from the cabinet to run for public office in the 2016 elections. Secretary Herminio B. coloma Jr. said President aquino is aware of the difficulty of getting “qualified and dedicated” presidential appointees to take over soon to be vacant posts in the cabinet, citing the case of ex-customs commissioner John P. Sevilla and Petilla. “Ipinapaliwanag niya [aquino] na hindi naman talaga madali ’yung makakuha nang mga kuwalipikado at dedicated public servants dahil marami pong challenges ’yung public service at nabanggit nga niya diyan—iyan po ang konteksto sa pagtalakay niya sa resignation ni Secretary Petilla,” coloma said. coloma, without naming names, added that Mr. aquino is also anticipating more vacancies in various key government posts held by President aquino appointees. Butch Fernandez

c.a. upholds rtc ruling on tower fee imposed on telecomsTHE court of appeals (ca) has upheld the decision of the cauayan city, Isabela Regional Trial court (RTc) that declared illegal a local ordinance requiring telecommunications companies to pay annual tower fee.

In a 16-page ruling written by associate Justice Stephen cruz, the ca’s Seventh Division denied the appeal filed by Mayor alfredo Remigio of San Mateo, Isabela, seeking to reverse and set aside the order of the cauayan city RTc that granted Smart communications Inc.’s (Smart) petition for certiorari and declared null and void Municipal Ordinance 2005-491.

The municipal government of San Mateo enacted on June 27, 2005, the ordinance entitled “an Ordinance Imposing Regulatory Fee known as annual/Tower Fee for the Operation of all citizens Ban, Very High Frequency, Ultra High Frequency and cellular Sites/Relay Stations Within the Municipality” pursuant to its power under Section 186 of Republic act 7160, or the local government code of 1991 to levy other taxes, fees or charges within its jurisdiction.

after public hearings and publications in a newspaper, the ordinance came into effect and notices of assessment were sent to Smart and other affected businesses in the municipality, which required the telecom firm to pay tower fee worth P200,000 per year. PNA

The Philippine electricity Market Corp. (PeMC) and the National Transmission

Corp. (Transco) on Wednesday signed an agreement that sets out the procedures and accountabilities of the parties in the remittance of the Wholesale electricity Spot Market (WeSM) proceeds to the Feed-in Tariff (FIT) allowance fund.

Thursday, April 30, 2015 • Editors: Vittorio V. Vitug and Max V. de Leon

PEMC, Transco ink pact on FIT-fund remittance EnERGy Secretary Carlos Jericho L. Petilla, who

steps down from his post effective Thursday, has recommended Undersecretary Zenaida y.

Monsada to assume as the agency’s officer in charge (OIC), pending Malacañang’s formal announcement on Petilla’s replacement. At a news conference on Wednesday noon, Petilla, who turned 52, announced on his birthdate that he submitted to President Aquino his resignation letter on a “Thursday, before Holy Week.” Since then, Petilla said, there has been no clear di-rection from Malacañang if the Chief Executive has accepted his irrevocable resignation. The last time he talked to the President was on Monday, April 27. “It wasn’t clear to me what his instructions are,” said Petilla, when asked if President Aquino has accepted his resignation, considering that his last day in office was on Wednesday. The President, who was quoted in Malaysia the other day, said Malacañang is already scouting for potential candidates to replace Petilla. Industry sources said there are two possible can-didates being considered. They are former energy secretary Raphael Perpetuo M. Lotilla and current national Transmission Corp. (TransCo) President Roland T. Bacani. Lotilla served the agency from March 2005 to July 2007. Prior to his appointment as energy secretary, Lotilla was the president of the Power Sector Assets and Liabilities Management Corp. (PSALM). He also briefly served as PSALM COO before he became presi-dent. He also served the national Economic and De-velopment Authority, from January 1996 to January 2004, as undersecretary. As of this writing, there was no announcement made if Petilla was asked to stay longer, pending an appointment for his replacement. “The OIC will be Undersecretary Monsada. If I do not receive any further instruction, then my under-standing is that my original resignation date stays,” he said.

personal reason PETILLA, in his resignation letter, cited “personal and family reasons,” as to why he quit his job. He, however, did not deny that he is considering seeking for a higher office in 2016. “I am keeping my options open. What position, if you ask me, I can never say, until the last minute that I have made up my mind,” said the energy chief, who was clad in his usual white long-sleeved polo. But if asked to stay longer, he said he is willing to do so. However, he could only stay a little while longer, and not until October this year. “My willingness to stay is for transition purposes only. This [resignation] is for real, and I will stand by it. If asked to stay put, it will be just enough time for them to look for somebody else,” Petilla said. The President said Petilla had told him as early as last year that he wants to pursue his personal plans, and that his desire to resign from his post was delayed because he had to deal with so many issues in the power sector. “I couldn’t, because there are so many issues to deal with. There was the Meralco [Manila Electric Co.] rate hike, power restoration after [Supertyphoon] yolanda and the power situation for the summer of 2015,” he said. In December of 2013 Petilla resigned, after he failed to make good on his promise to energize the areas in the Visayas that were badly hit by a tropical storm. His resig-nation, however, was not accepted by President Aquino.

surviving the power crisis PETILLA said that all preparations have been undertaken to address a possible power shortage this summer. This makes it timely for him to announce his resignation. “At this point in time, all power plants that should have been put up were put up. All power-plant mainte-nance work scheduled for summer has been done. On ILP [Interruptible Load Program], we have scraped the barrel looking for additional capacity. Energy-saving tips, we have intently relayed these to the public. The only thing to do at this point is to monitor, because ev-erything that needs to be done has already been done,” Petilla said. Luzon survived the months of March and April with no reported power outage, amid the 30-day shutdown of the Malampaya natural-gas facility and unscheduled shutdown of some power plants in the grid. “It looks like we are going to survive this summer. With what we have been doing, it looks like it’s going to be okay at this point in time,” Petilla said. Meralco, however, said that electricity rates could go up in the next few months, on account of increasing demand amid a number of power plants scheduled to go offline for maintenance in May and June this year. “We are still not out of the woods yet. The concern that we have is during the May and June months, when maintenance work is scheduled, continuing higher demand and a forecast of a much warmer climate,” Meralco Chairman Manuel V. Pangilinan said. Among the power plants that are scheduled to go offline are Santa Rita and the San Lorenzo power plants of the Lopez group, and the Pagbilao coal plant. “Recall that last year the peak demand day happened on May 21,” Pangilinan added. Peak-power demand in Luzon hit 7,000 to 8,000 megawatts (MW) during the maintenance shutdown of the Malampaya gas facility that supplies gas to three power plants, with a total capacity of 2,700 MW, pro-viding about half of Luzon’s power needs. These power plants are the 1,000-MW Santa Rita; the 500-MW San Lorenzo; and the 1,200-MW Ilijan. Petilla said peak demand in Luzon next month is likely to reach 9,000 MW. “We could only count on the resources that we have put up to combat any possible power-supply problem. We did everything that we could,” Petilla said. no regretsTHE DOE has faced many challenges under Petilla’s term. One of which is his recommendation to the President to seek for emergency powers to address an anticipated power crisis. “Could have I done more? Probably, but I have no regrets. At that particular time, those were the best choices ever made,” he said. Petilla is confident that he has inspired the En-ergy Regulatory Commission in creating a competi-tive and healthy environment for the private sector. “I can never impart enough. I hope I inspired them just enough to continue what they are doing best,” he said. Petilla served the agency for two years and five months. During those years, he said it was “exciting and more fun in the energy sector than in the DOT [Department of Tourism].” “The energy sector has many problems. you need not only technical and local government unit skills. you need to have, as well, corporate and guerrilla tactics. you have go to use all these arsenal. I am proud of what the DOE people have done. It’s not me. Secretaries come and go but the people at the DOE stays.” Lenie Lectura

Petilla resignation to take effect on Thursday

By Lenie Lectura

understanding of power consumers and other stakeholders on the implementation of the FIT Allowance and, in the proc-ess, help promote widespread utilization of renewable energy,” Transco President Roland T. Bacani said. “For our par t , t h is memorandum of understanding proves PEMC’s commit-ment that we are one with the government in its drive to accelerate the utilization of renewable-energy resources and its increase in our energy mix toward the achievement of energy security and in-dependence,” PEMC President Melinda Ocampo said. The WESM is a centralized venue for buy-ers and sellers to trade electricity as a com-modity where its prices are based on actual use and availability. It began commercial operations in Luzon in June 2006 and in the Visayas in Decem-ber 2010. In June 2013 PEMC launched and integrated the Retail Competition and Open Access into the WESM.

malacañang vows greater efforts on jobs creationMalacañang on Wednesday said the government will pursue greater efforts to create more jobs in the economy and reduce unemployment.

Secretary Herminio B. coloma Jr. stressed this amid a new survey by Social Weather Station (SWS) indicating a decline in the country’s unemployment rate.

The SWS survey showed that joblessness rate dropped from 27 percent last December, to 19.1 percent in March 2015, its lowest since 2010.

coloma noted that government’s intensive job generation efforts have brought more productive opportunities, thus reducing joblessness in the country.

“Skills training and job matching programs are also paying off,” he said in a news statement. PNA

OCAMPO: “For our part, this memorandum of under- standing proves PEMC’s com- mitment that we are one with the government in its drive to accelerate the utilization of renewable-energy resources and its increase in our energy mix toward the achievement o f e ne r g y s e c u r it y an d independence.”

briefserc approves p8.69-per-kwh

fIt rate for solar projectsThe energy Regulatory Commission (eRC) approved to adopt a new Feed-in-Tariff (FiT) rate of P8.69 per kilowatt-hour (kWh) for solar-energy projects. The FIT is the per kWh rate that will be guaranteed to renewable-energy (Re) developers to ensure the viability of their projects. Consumers shoulder the tariff through a new line item in their electricity bills. They are now paying an additional P0.0406 per kWh. For the solar-powered facilities that have been commissioned prior to the new solar FiT rate’s effectivity, the original solar FiT rate of P9.68 per kWh shall continue to apply, ruled the eRC in its four-page decision signed on March 27 but posted on its web site on Wednesday. “After careful consideration and guided by the policy objectives in the Re Act of 2008, the eRC deems it appropriate to approve and adopt a new solar FiT rate,” the eRC said. Lenie Lectura

news@businessmirror.com.ph Thursday, April 30, 2015 A5BusinessMirrorEconomy

Microinsurance Network Chair-man Michael McCord told reporters here on Wednesday that microinsur-ance coverage in the Asia and the Pacific region was at 66 million. A third of this, or around 27.9 million, are in the Philippines. “The Philippines itself has been a tremendous case study for microin-surance; that’s really one of the best examples across the globe for micro-insurance. Here, you have almost 30 percent of people in the Philippines

covered by microinsurance, for vari-ous kinds of products,” McCord said at a news conference at the Apec Roadmap for Resilient Economies Meeting on Disaster Risk Finance. McCord said microinsurance is necessary to achieve inclusive eco-nomic growth. Microinsurance can act as a safety net, especially for low-income households that are highly vulnerable to disasters. He added that these disasters are not confined to natural disasters,

such as earthquakes and strong ty-phoons, but also the loss of life of key family members like breadwinners. Having microinsurance, McCord said, can prevent these families from falling into poverty or falling deeper into poverty. In order for these microinsur-ance products to reach low-income Filipinos, McCord said the govern-ment and private sector must create innovative mechanisms to distribute these products. McCord added that there is also a need for government support that will encourage insurance firms to of-fer microinsurance products through incentives and efficient regulatory framework. The absence of these two condi-tions are usually the reasons insur-ance companies become discouraged in offering microinsurance products to low-income Filipinos. “I believe that without insurance products, you can’t have sustainable development. The [function of] in-surance is to keep people from falling

back into poverty,” McCord said. Recently, the Asian Development Bank (ADB) said preventive social- protection programs, such as micro-insurance schemes, can cushion the impact of variable weather patterns and natural disasters. The ADB added that governments need to accelerate the review and reform of pension schemes in view of the region’s huge informal sector and rapid aging. “Expanding social-protection coverage requires mobilization of additional public revenue, which can be secured by broadening the tax base, improving tax collection and improving public-expenditure management,” the ADB said. “Governments should also en-courage private firms to contribute more to social insurance programs. After many years of high growth, the Asia and Pacific region is in an excellent position to invest in better social-protection systems that are attuned to the needs of its people,” it added.

Microinsurance coverage in phl breaches 27-million mark–Mccord

By Cai U. Ordinario

BACOLOD CITY—Nearly 30 million Filipinos are covered by at least one form of microinsurance

product nationwide, according the Microinsurance Network, the advocate of insurance-service coverage for low-income populations worldwide.

By Recto Mercene

LAST year Manila Mayor Jo-seph Estrada imposed a truck ban in the city streets that

affected the country’s economy, prompting the national government to intervene. That intervention was in the form of good, old-fashioned disci-pline, focused government plan and new technology. That brought back to normal the flow of goods at the Manila ports. Cabinet Secretary Jose Rene D. Almendras, concurrent chairman of the Cabinet Cluster on Port Conges-tion, told this upbeat report during a Senate hearing last week. He said the current situation showed that the truck ban is not a per-manent answer to the traffic problem, and that trucks allowed to free-flow may actually be a better solution. Sen. Bam Aquino, chairman of the Committee on Trade, Commerce and Entrepreneurship, expressed satisfaction on the situation at the Manila ports. During the truck ban, it was reported that port utilization has gone down from 97 percent, to the current 60 percent or lower, despite

the increase in cargo volume. Almendras said the government will seek to ease the situation further and assured that port operations re-main at normal level regardless of volumes by improving road access to the ports. “There is an initiative by the Department of Public Works and Highways to find an alignment or an elevated branch into the port that seems to be a challenge and we are actually looking at waterways that seems controversial at the mo-ment,” he said. He added that the connector roads being built leading to the Ma-nila ports faces right-of-way prob-lems, but said that the government finds it necessary to implement it with the rising volume of trade, fueled by the continuing growth in the economy. “Only a percentage of cargo actu-ally goes to south or to the north [of Luzon] while huge volumes of cargo, the majority of which are intended for Metro Manila,” Almendras said. “When someone proposed that the ports be kicked out from Manila, I explained to the leadership of the city that that is not a very good idea since that’s how the city was born,” he added.

Manila port logjam finally resolved, Palace exec says

SUBIC BAY FREEPORT—The Port of Subic has kept its three-year growth momentum, which started in 2012 up to the first quarter

of the current year.“For the past three years, the Port of Subic has

continued to register positively in terms of rev-enues, gross registered tonnage [GRT], number of ship calls, and noncontainerized and container-ized cargos,” Subic Bay Metropolitan Authority (SBMA) Chairman and Administrator Roberto Garcia said.

In 2011 annual port revenues were re-corded at P371 million, which, by 2014, had ballooned to P908 million, or a total growth of 126 percent.

In addition, ship calls increased from 1,803 in 2011 to 2,591 in 2014, indicating a growth of 15 percent.

Garcia said the port’s GRT was only 14 mil-lion in 2011, but expanded to 40 million last

year, growing by 186 percent during the three-year period.

“Our port also enjoyed similar growth in terms of containerized cargo, which grew from 27,671 twenty-foot equivalent units (TEUs), in 2011 to 77,177 TEUs by 2014, reflecting a 60-percent growth,” he said.

Noncontainerized cargo volume, on the other hand, also experienced a three-year buildup of 136 percent, from 2.6 million metric tons (MMT) in 2011 to 6.1 MMT in 2014.

Garcia said the SBMA is anticipating further growth, given the positive outlook for the coun-try’s economy.

This optimism seems to be bearing out, as the Subic Port’s year-on-year performance for the first quarter of 2015 shows the same uptrend it has enjoyed in the past three years.

“Our por t revenue has increased by 20 percent, GRT by 12 percent, noncontaine-

r ized cargo by 15 percent, conta iner ized cargo by 28 percent and ship ca l ls by 18 percent,” he added.

Garcia said the entry of more domestic and foreign vessels that call regularly on Subic has vastly improved the port’s connectivity to the world.

“We now have NYK Line, SITC, Maersk Line, APL and Wan Hai vessels plying to and from major Asian ports, like Kaohsiung, Tanjung, Singapore, Busan, Xiamen, Jakarta, Ho Chi Minh, Shanghai and Surabaya, among others; as well as to and from Japanese ports, such as Tokyo, Nagoya, Osaka, Chiba and Kobe,” Garcia said. He also noted that the Subic Port success-fully managed to accommodate the sudden surge in container shipments at the height of the Manila port congestion last year, proving its capacity and readiness to handle volume shipments. PNA

Subic Freeport sustains 3-year growth momentum

Young street artIst A teenaged boy chooses to spend a worthwhile summer break from school by painting cartoon-inspired artwork on ceramic plates and cups at a sidewalk stall in Quiapo, Manila. The finished products are then sold at a starting price of P80 a piece. NoNie Reyes

39 celebrItIes are b.I.r.’s top taxpaYersThIRTy-nIne celebrities are included in the Bureau of Internal Revenue’s (BIR) top 500 individual taxpayers, the agency said in its latest Tax Watch released on Wednesday.

World champion professional boxer and Sarangani Rep. Manny Pacquiao was named as the highest individual taxpayer as of november 2014 for taxable year 2013.

For the said period, Pacquiao’s income- tax payment reached over P168.84 million.

The income-tax payment covers regular income taxes and not only for income on endorsements.

It was noted that four top taxpaying-celebrities in the list following Pacquiao were talents of ABS-CBn Corp. namely, Piolo Pascual who is 14th largest-tax paying individual at P42.53 million; John Lloyd Cruz, top 15 with income- tax payment worth P41.98 million; Kris Aquino, top 16 with P40.48 million; and Sharon Cuneta, top 19 with P39.05 million.

noon-time variety show hosts across Philippine channels are included in the BIR’s top 500 list. PNA

bcda bIds out 4,714 herItage park MeMorIal lotsThe state-owned Bases Conversion and Development Authority (BCDA) said it has put up for competitive bidding the block sale of heritage Park Investment Certificates (hPIC) representing 4,714 memorial lots and properties.

“We are inviting interested firms to participate in the public tender of the said lots and properties,” BCDA President and CeO Arnel Paciano D. Casanova said.

Casanova said the public tender of the lots and properties is on an “as-is, where-is” basis via cash sale mode.

Casanova said the minimum acceptable bid price for the hPIC is P430 million

inclusive of value-added tax. Of the 4,714 lots and properties,

3,580 are small plots. The inventory also includes estate lots, walled estate lots, garden lots, single columbary niches and companion columbary niches, among others.

A prebid conference will be held on May 8 at 10 a.m. to discuss the salient features and requirements of the terms of reference, as well as queries from interested bidders.

heritage Park is along C-5 in Fort Bonifacio, Taguig, and is considered as the country’s premier memorial park. PNA

Thursday, April 30, 2015

OpinionBusinessMirrorA6

An epidemic of drug mules

editorial

DRUG mules—persons who smuggle illegal drugs using their bodies across international borders—form a huge bulk of how unlawful contraband is being shipped from one country to another.

Statistics are hard to come by about this kind of smuggling. But, if only to give us an idea of how rampant this has been for the past couple of years, 50 percent of all foreign female population in United Kingdom prisons are drug mules from Jamaica (BBC News, 2013). Other reports say Nigerian women also form a huge bulk of the remaining figure.

At the John F. Kennedy airport alone, in a year’s time (2002 to 2003), 145 drug mules, had been intercepted; 38 were female and 107 males.

In China’s jails, more than 200 Filipinos have been named as drug mules, with more women (161) than men (59). Most of them are languishing on death row.

Women and children are often employed as drug mules, as they attract the least suspicion, especially pregnant women, who are not subjected to x-ray and metal detectors.

Drug mules often use the “body packing” technique, where contrabands, such as heroin or cocaine, are placed inside condoms or rubberized wrappers. These are swallowed to avoid detection. Many have died of an overdose, because of the risk of the condoms breaking inside the body, releasing the drugs in massive doses into the system.

Drug lords, who conduct their drug-mule operations in poor countries like Nigeria, have an “army of swallowers,” who can swallow as much as 100 to 150 condom balloons. For each successful border crossing, a Nigerian drug mule can earn up to $15,000 per trip. Nigeria’s per capita is only about $2,100. The average pay a drug a mule gets amounts to $3,000 to $5,000, depending on the level of difficulty of the drop-off.

Other syndicates are more creative. Earlier this year in France, two children aged 3 and 4 were found lingering inside a train station, abandoned by their family. A homeless man had caught sight of the two children and reported this to authorities. Inside their backpacks and diapers, 5 kilos of cocaine were found.

Children are the least likely to get caught by port and airport authorities, which is why they are the most likely victims of drug traffickers. “Victims,” because there has been a rising number of so-called drug mules who are not part of any syndicate or willfully crossing bor-ders with contraband. Out of goodwill, these people accepted packages handed to them that contain contraband. That is why it is important for persons who travel to lock their luggage and never hand over their luggage to strangers.

Mary Jane Veloso, a Filipina house help scheduled to be executed for drug trafficking in Indonesia, appears to be a victim of this practice. Despite the evidence that may have pointed to her alleged guilt, Veloso remains adamant that she is innocent. As of this writing, she has received a reprieve from execution. But things can still go either way.

We can only hope that the case of Veloso can spur further discussion on how best to solve the problem of drug mules.

IT is difficult to explain the idea of cycles when related to economies and financial markets. We all understand the cycle of moon, as we can see the evidence in the changing phases

of the moon.

By Dick Meyer | Scripps Washington Bureau/TNS

THE Meaning of Life and I haven’t gotten along well the past few years. But I think we’re pulling out of it.

My existential outlook became cloudy when my nest emp-tied, kids away at college and graduate school. After our first was born, the meaning of life was obvious: love and rear our kids. Yes, there were moments when parenting wasn’t enough, metaphysi-cally; they were fleeting, caused more by a morose temperament and everyday anxieties, nothing very deep.

Understanding stock-market cycles

Remember, it’s not the summit that matters in life, it’s the climb

However, when it comes to things that we humans play an active role, we believe that our freewill deter-mines what is happening, and not that it is part of a “natural” cycle. We might acknowledge, though, that our collective tastes and habits might influence the cycles, but ultimately we are not controlled by the cycles.

Take movies, for example. There are several basic genres: action, comedy, drama and horror. Within those, there are subcategories, such as adventure, disaster, crime, war, history, romance, science fiction and musicals.

At any given time, there would probably be enough people who like each of those types of movies that there would always be an action film, comedy and horror movie at the top of the box office. But it does not work that way.

Within four years in the early 1970’s disaster movies, Airport, The Poseidon Adventure and The Towering Inferno all came out. Star Wars, Blade

Runner, and E.T. nearly overlapped. Action movies Raiders of the Lost Ark, Aliens and Die Hard followed one an-other. For the last few years, trans-formers and heroes like Iron Man have dominated the silver screen.

We could dismiss this only as a cycle of movie patrons’ tastes, and that is exactly the point. But do the “tastes” determine the cycle, or does the cycle determine what people want to see?

In his book The Wave Principle, published in 1938 by an accountant, Ralph Nelson Elliott developed the Elliott wave principle. He said that market prices move in specific pat-terns. That is pretty obvious; prices go up, go down, and then go up again. But Elliott’s idea on waves or cycles was that investor psychology moves between optimism and pessimism in natural sequences. Sure, we know that is true also. But the key is in “natural sequences.”

Elliott looked back at the history of price movements, and created a

template of five basic waves and a number of subwaves that could be placed over a price chart to forecast future price movement.

The moon completes its orbit around the Earth in 27.3 days, the sidereal month. You could dis-cover this by simply making dai-ly observations. However, with knowledge about astrophysics, the same calculation could probably be made without ever observing the moon’s movements. That is because the factors that move the moon around the Earth on a regular basis never change.

If Elliott was correct, then every-one would be a stock-market winner by using his template. But that does not happen, since the waves may be accurate in form but are not ac-curate in time. The duration of the waves changes. Because of external factors, like instant order execution and computer-generated trading, the cycles have both shortened and lengthened, unlike with the moon.

Since 2000, the Philippine Stock Exchange has followed an approxi-mate pattern of four years up and one year with prices not going up—but not necessarily down. Individual is-sues follow their own cycle that is not always in synch with the index.

If you spend days and weeks cal-culating the cycles, it can actually be reduced down to a specific number of months and days for the indexes and 70-some listed issues. I have done that and no, I am not going to share my research.

However, if you know these cycles, constantly update the in-formation and adjust the cycles on a regular basis, then you can be in a position of not worrying when prices go down, because it is only temporary and, likewise, not to get too excited with an upward move-ment because you know that prices are soon going south.

Most stock-market investors are so concerned about understanding why stock prices move that they are not willing to make the effort to simply understand how prices move. Therefore, they miss the cycles most of the time. They become part of the “greed-and-fear” cycle rather than taking advantage of that cycle.

You do not need to know the “why” to understand that there is a cycle of solar eclipses. If you understand the cycle of the phenomena that blocks the light of the sun, then you will also know that same cycle will bring the sunlight back out.

Every sailor—even from time immemorial—knows that the di-rection the wind is blowing cannot be changed. But the trim of the sail can be changed to take advantage of the wind’s “cycle” to get where you want to go.

E-mail me at mangun@gmail.com. Visit my web site at www.mangunon-markets.com. Follow me on Twitter @mangunonmarkets. PSE stock-mar-ket information and technical analysis tools provided by the COL Financial Group Inc.

OUTSIDE THE BOXJohn Mangun

My adolescence (my wife says it last-ed till my 30s), though, was an easily mocked festival of pretentious angst; I say pretentious but it felt genuine at the time. I wanted to be a true believer—in some big thing. But I was a skeptic, without religious faith, intolerant of authority and conformists. I soaked up Nietzsche, Dostoyevsky, Freud, Marx, Jung—the grandiose guys who had grand, coherent worldviews with all the answers.

This is the classic sophomoric stage. Two people guided me out of it, and I formed a lifelong mistrust for answers and beautiful theories.

First, as for many my age, came Rob-ert Pirsig and Zen and the Art of Motorcycle Maintenance. My epiphany was that, for me, meaning and purpose came from looking, not finding—from the climb,

not the summit. “It’s the sides of the mountain which sustain life, not the top,” Pirsig wrote.

In graduate school, I caught the break of my life, except for my family. I stud-ied with the British historian of ideas, Sir Isaiah Berlin, a Russian émigré to England. Berlin despised my early exis-tential heroes. He had no tolerance for answers, for certainty, for sanctimony, for zealotry and for the idea that all the world’s values were in harmony, when properly understood. He believed those were the human weaknesses that bred the great evils he survived, Soviet Com-munism and Nazism.

To Berlin, the meaning of life came from the climb. It was about resisting the temptations of being a true believer, of not being confused. Berlin’s climb was about seeing the world through other

people’s eyes, which is antinarcissistic and reveals lives have many, many mean-ings. Abstract became real with my kids. Perhaps, it gave me clarity of purpose I never had, if not the Meaning of Life.

Without kids at home, purpose be-came elusive.

Last week I had the chance to inter-view Yuval Noah Harari, the author of the most idea-packed work of nonfic-tion I’ve read in years, Sapiens: A Brief History of Humankind. Harari is a his-torian with a scientific bent who asks weird, audacious questions about our species. He’s interested in why humans have produced fabulous civilizations, gained enormous practical knowledge and invented enduring religions and philosophies, but have not been able to create more content, wiser individual Homo sapiens.

We know this has been true over past century, thanks to polling and empirical social science. In prosperous societies, individuals have slowly and almost im-perceptibly become less happy and con-tent. More prosperity doesn’t help. This is often called the “Progress Paradox.” Harari thinks that what we call progress has increased individual contentment in some eras, not most.

Harari sees history through the lens of biology and hard science. Homo sapi-ens are just fancy animals. The idea that

our lives should have meaning is just a fiction we concocted because it was use-ful to the species at some point.

This depressed me. I asked Harari if it depressed him. It did, he said, but he had an epiphany. Harari doesn’t look to religion and the great philosophers for the Meaning of Life. “They give you the impression that there is an answer, and you stop asking the questions.”

“I make a distinction between reli-gion and spirituality,” Harari told me. “I think I’m not a religious person, but I am a very spiritual person. For me reli-gion is about answers, and spirituality is about questions.”

“The spiritual quest is when you ask a big question, like ‘Who am I?’ Or, ‘What is reality?’ And you are willing to follow this question wherever it takes you,” he said. I’ve always seen my post-sophomoric climb as philosophic, not spiritual. Time to rethink that.

I’ve been disheartened by how much we reward the politicians, polemicists, self-help gurus and preachers who say they have the answers, stridently and with sophomoric certainty. Black and white trumps gray in a busy, loud world.

I’m grateful Harari reminded me that the climb matters more than the summit. It can be an ephemeral insight. I’ll need to hold on to it, at least until I have grandchildren.

Thursday, April 30, 2015

OpinionA7BusinessMirroropinion@businessmirror.com.ph

Branches on the vine

ONE shall praise the Lord in the assembly, just as all the earth shall bow before Him, because of the deliverance He has brought (Psalm 22:26-27, 28, 30, 31-32). Like branches on

the vine that bear much fruit, those who remain in Christ and in whom His words remain bear much fruit and whatever they ask for will be done for them (John 15:1-8).

To Him my soul shall livePsalm 22 is famous because Jesus on the cross uttered its opening words: “My God, my God, why have you abandoned me?” The original psalmist has been pleading with God, promising to thank God and to proclaim His response of mercy and compassion in the public assembly of those who fear and worship God: “I will praise You, Lord, in the as-sembly of Your people.” His prayer answered, the psalmist bursts into a hymn of praise. And he fulfills his vow in the midst of the believing community: a charitable feeding of the poor so that the lowly shall eat their fill. Thus, those who seek God in His mercy shall praise Him; they shall always be of good cheer! As for the psalmist, he knows that it is to God that his soul shall live.

God’s blessings are not limited to only a few but extend to all the ends of the earth, to all the families of na-

tions. Therefore, all shall remember His goodness and turn to Him and bow down before Him. “All the na-tions you have made shall come and bow down before You, Lord, and shall glorify Your name” (Psalm 86:9). In fact, God’s reign extends beyond the entire land of the living into the realm of the dead, those “who sleep in the earth” and “go down into the dust.” All the living and the dead have known of God’s goodness, and all bow down to Him alone. Truly, even the future generations shall be told of the Lord and descendants still to be born shall also praise and give thanks to Him. For all shall know of the righteousness of God shown in His care and blessings.

The Father is glorified by your bearing much fruitTHE allegory of the vine presents Jesus as the true vine that faith-fully produces good fruit pleasing to

the Father, the vine grower. This is in contrast to the vine representing the house of Israel and the people of Judah in Isaiah’s (5:1-7) song of the vineyard condemned for its infidel-ity, and so as it brings forth wild grapes it will not be pruned and hoed but allowed to fall into destruction. Unproductive branches that do not bear fruit are cut and taken away to be burned, while branches that bear fruit God trims so that they bear more fruit.

In a divine self-revelation, Jesus makes the claim that as the true vine He brings forth good crop. For the branches to be productive, they have to remain in Him as He remains in them. Jesus is the unique conduit between God and His creation; in God’s vineyard, Jesus is the me-diator of life and grace between the Father and those who believe in Him. On their own the branches cannot bear fruit. Away from Him His followers cannot bear fruit. They need to abide in Him as He abides in them. And it is the Father who directs the flow of life from Jesus to His disciples, the vine grower whose ultimate goal is to produce vintage wine. He cuts away fruitless branches and prunes fruitful one to produce more. In the abundant yield the Father is glorified.

Remain in Me and My Words in youTHE metaphor of the vine and the branches illustrate the intimate union between Jesus and His fol-lowers. The branches live on the

vine; the life of the vine flows in the branches. Through the branches the vine bears fruit; they bear the fruit of the vine. The vine is not vine if there are no branches; the branches are nothing separated from the vine. Separation from the vine is fatal. It is in their mutual and reciprocal indwelling that life and abundant fruits are guaranteed.

The flow of life in and the pro-ductivity by His followers depend on the Word of Jesus. The vitality of the branches is fostered by the “pruning” and cleansing effect of Jesus’ Word. It strips away whatever blocks the flow of life between them and Jesus and his Father. Allegiance to the Words of Jesus, His gospel and teaching, shapes the identity of His followers. This bond of faith closely joins one to the life-giving vine and to the other branches; without it one faces withering and dying. And linked intimately with the vine, one is entitled to access God’s blessings, the prayers of the branches become the prayers of the vine.

Alálaong bagá, the Risen Lord is the life-giving vine in whom the branches must abide in order to bear fruit that glorifies the Father. The community of faith, shaped by the Word of Jesus, lives and is productive only with the life of Jesus.

Join me in meditating on the Word of God every sunday, 5 to 6 a.m. on DWIZ 882, or by audio-streaming on www.dwiz882.com.

AlálAong BAgáMsgr. Sabino A. Vengco Jr.

China’s middle class can finally afford iPhones

THE most obvious way to read Apple’s latest quarterly earnings report—which revealed that iPhone sales in China had surpassed those in the US for the first time—is as a

compilation of great news about the company’s bottom line. But it’s also a sign that China’s consumer market is finally starting to come into its own. It might even mark China’s so-called Henry Ford moment, when a sizable portion of the country’s workers can finally afford to buy the things they’re manufacturing.

Advance pricing agreement in PHL

BlooMBERg VIEWWilliam Pesek

ON January 3, 2013, the Department of Finance issued the much-awaited Revenue Regulations (RR) 2-2013, which is now the consolidated transfer-pricing rules and regulations

(RR) in the Philippines.

The Bureau of Internal Revenue (BIR) is currently drafting another revenue regulation prescribing the guidelines and procedures in administering the Advance Pricing Agreement (APA) pro-gram. In fact, on October 17, 2014, the tax bureau invited panelists from both the private and public sector for an ini-tial discussion on the salient provisions of the draft RR on APA. I was fortunate enough to be among those who partici-pated in the conference.

The original draft presented the establishment of an APA with the com-missioner of internal revenue, who shall act as the competent authority. Like-wise, the draft provides guidelines for initiating the APA process; prescribes the procedures in processing the APA applications; prescribes the APA forms and documentation requirements; and provides guidelines during the imple-mentation period of the APA.

Notably, the proposed APA program is a voluntary program whose goal is to increase efficiency in the tax adminis-tration and reduce taxpayer-compliance burden in resolving transfer-pricing issues. The BIR and taxpayer agree in advance of the execution of cov-ered transaction the most appropriate transfer-pricing method in respect of the transaction.

Based on the draft regulation, partici-pation to the APA program is initiated by the taxpayer through the filing of an APA application. Under the APA process, the taxpayer proposes a transfer-pricing method with respect to the related party transaction, and provides relevant data and information to show that its pro-posed method is the most appropriate transfer-pricing method.

Among the salient features of an APA is that it is contractual in nature, and works on a prospective basis. Also, an APA, as well as any background in-formation related to the APA, the tax-payer’s APA request for APA and return information, is confidential. Further, an APA has specific duration of three years and applies only to the proposed covered transactions. The APA process covers related party cross-border transactions, including the following: sale; purchase, transfer and use of tangible property; transfer and use of intangible property; financing; and provision of services.

The APA process has six stages: (a) Prefiling; (b) Formal filing; (c) Fact-finding and Review; (d) Discussions and Negotiations; (e) Signing of the APA; and (f) Implementation and Monitoring.

Note that under the APA program, taxpayers who file a request for Prefiling Conference shall automatically be en-listed with the Large Taxpayers Service (LTS). If a taxpayer wishes to apply for an APA for a proposed covered period, he should submit the APA application no later than 12 months before the first day

of the proposed covered period.Upon advice of the merit of the appli-

cation, the taxpayer shall formally file the APA application together with all the supporting documents and payment of a filing fee in the proposed amount of P2.5 million. During the formal fil-ing stage, the taxpayer is required to file a waiver of domestic time limits on assessment.

Following the review and negotiation stage, the competent authority shall for-malize the APA. The concluded APA shall be a binding agreement between the tax-payer and the BIR. During the implemen-tation and monitoring stage, the taxpayer shall file with the LTS an Annual Compli-ance Report, otherwise failure will lead to the cancellation of the APA, and the taxpayer is thus open to audit.

The APA may either be revised, pre-terminated, revoked or renewed, de-pending on the circumstances. Revision of APA arises if there is a breach of critical assumptions, which refers to the factors and assumptions that are so critical and significant that neither party entering into an agreement will continue to bound by the agreement, if any of the factors or assumptions is changed.

On the other hand, an APA may be preterminated in case of:

n Gross error or mistake in the APA application, annual compliance reports or renewal submissions of the covered transactions by the parties to the APA;

n Failure to provide information, documentation and compliance report as required by the APA rules;

n Failure to comply with the terms and conditions, including breach in critical assumptions, of the APA by the taxpayer; and

n Failure to sign the revised APA.If there was fraudulent misrepre-

sentation by the applicant or if the ap-plicant failed to materially comply with a fundamental term or condition of the APA, it may be revoked. Renewal may be made upon request for a renewal of an APA and payment of a fee of P500,000.

Apparently, the proposed draft of the RR on APA still has plenty of room for improvements, and we hope the proposed revisions we presented will be considered by the bureau.

atty. Filamer D. miguel is a senior associate of Du-Baladad and associates law Offices, a member-firm of World Tax services alliance. The article is for general information only and is not intended, nor should be construed, as a substitute for tax, legal or financial advice on any specific matter. applicability of this article to any actual or particular tax or legal issue should be supported, therefore, by a professional study or advice. If you have any comments or questions concerning the article, you may e-mail the author at filamer.miguel@bdblaw.com.ph or call 403-2001, local 360.

It’s still a bit too early to defini-tively draw that conclusion. Apple’s statistics may have been skewed by the post-Christmas lull in the US, which coincides with the peak Lunar

New Year shopping season in main-land China.

But there’s no reason to think the upward trends for China’s mid-dle class will reverse anytime soon.

Apple’s sales figures seem to confirm recent studies by the Asia Society Policy Institute and the Rhodium Group, which showed that Chinese incomes are rising faster than of-ficial data indicate. As Apple CEO Tim Cook has pointed out, “I’ve never seen as many people coming into the middle class as they are in China, and that’s where the bulk of our sales are going.”

What’s clear is that the spending power of Chinese consumers will eventually catch up with the coun-try’s industrial capacity—and when it does, the global marketplace will be changed forever. China will start to become the world’s new center of gravity for corporate executives and world leaders alike. “Thirty years ago, the West wanted nothing more than for China to become a capital-ist economy,” Harvard University’s

Jeffrey Frankel writes in a Project Syndicate op-ed. “The rules of the game now require that China be given a bigger share in the governance of international institutions.”

Consider how this shift is already affecting trade dynamics between the US and China. The steady rise of the Chinese consumer clearly weakened Washington’s negotiating position as it tried to convince other countries not to support the Asian In-frastructure Investment Bank. Sili-con Valley, for its part, has also had to navigate a power dynamic that is constantly shifting eastward. Beijing is well aware that US companies like Apple increasingly depend on Chi-nese consumers for growth, which has made it harder for them to push back on China’s loose protections for intellectual-property rights.

Apple’s strategy so far has been

to try endearing itself with both the Chinese masses and the Chinese government. It has nudged its facto-ries there to pay more than competi-tors, while also offering free educa-tion to workers. It has also agreed to cooperate with state-owned China Telecom in hosting data. By introducing a firewall in China for its iCloud, Apple has found a way to give Chinese consumers access services that are similar to those it offers in the West, while also placat-ing Chinese authorities.

To be sure, the rapid expansion of China’s consumer market will also pose problems for China. In recent years, the public’s anger over pollu-tion has been the primary cause of protests and social unrest. But as Chi-na’s consumption patterns start re-sembling those in the United States, the problem is sure to get worse.

Chinese residents might have gotten used to reaching for their iPhones for air-safety updates, but Apple’s many factories are themselves re-sponsible for a significant share of China’s air pollution. One need only imagine what China’s skies will look like when the average Chinese owns a car—or two.

China is now entering a new stage of its growth. In many ways, it re-sembles the industrial and consumer revolutions that upended the United States’s political and economic order at the turn of the previous century. There are significant differences, of course—including that contempo-rary China has a population 17 times larger than that of the US in 1900. To that extent, it’s safe to say China’s current revolution will be signifi-cantly more disruptive for the world than America’s earlier rendition.

By Mark Gilbert | Bloomberg View

THE Japanese government did something weird last week, but weird in a good way that other governments should follow. It nominated (drumroll) a new member of its central bank

(fanfare) who has actually (fireworks) worked in industry (huge applause, fade to sunset)—namely, Yukitoshi Funo, 68, who used to run Toyota Motor’s North American business. Equally surprisingly, the guy he’ll replace later this year is Yoshihisa Morimoto, himself a former executive of Tokyo Electric Power Co.

I’m willing to bet that if you asked the average person to guess what kinds of people set the interest rates on their mortgages or car loans, they’d be shocked to discover how rarely a central-bank committee features an industry executive or a business leader. Instead, the boards are packed with economists and academics, none of whom ever had to fund payroll on a Friday, decide whether to open a new factory, hire workers in expectation of good times ahead, or lay off staff to survive a downturn. In short, mon-etary policy is mostly decided by un-elected theoreticians who have never had much skin in the game of what actually happens in the real world.

The one industry—if you can call it that—that’s renowned for breed-ing future policy-makers is banking. Goldman Sachs leads the way as an incubator for borrowing-cost bosses, spawning both Mario Draghi, who helms the European Central Bank; and Mark Carney, the Canadian-born Bank of England governor. As im-portant as the world of finance is to

the global economy, though, it’s hard to justify its dominance in central-banking deliberations. And the risk of promoting groupthink is obvious.

Still, it’s only natural that the econ-omists who work at central banks pre-fer working with other economists. In a 2012 paper, Lauren Rivera, a profes-sor at Northwestern University in Illinois, found that elite professional services firms effectively block out-siders by only recruiting those who share their existing culture:

Hiring practices are gatekeeping mechanisms that facilitate career opportunities for some groups, while blocking entry for others. Hiring is more than just a process of skills sorting; it is also a process of cultural matching between candidates, valu-ators and firms. Employers sought candidates who were not only com-petent, but also culturally similar to themselves in terms of leisure pur-suits, experiences and self-presen-tation styles. Concerns about shared culture were highly salient to employ-ers and often outweighed concerns

about absolute productivity.Trawling biographies and tapping

the brains of colleagues, I found a handful of counterexamples. Ed-ward Kelley, who retired as a Federal Reserve (the Fed) board member in 2001 after 14 years of service, ran his father’s manufacturing company for two decades before joining an invest-ment company in 1981. David Lilly, who served the Fed from 1976 to 1978, was previously president and chairman of Toro Co., whose prod-ucts include lawn mowers and oth-er landscaping equipment. Wayne Angell, who joined the Fed in 1986, was a farmer in the early 1970s and brought a sharp focus on what was happening in commodities during his tenure. Even he, though, had a PhD in economics completed in the 1950s, and ended up at Bear Stearns before starting his own economic- forecasting shop.

In the United Kingdom Richard Lambert had risen through the ranks of the Financial Times to become its editor before the Bank of England (BOE) tapped him to join its mon-etary-policy committee in 2003; although he’d never run a company, he’d met hundreds of chief executives as a journalist, and went on to run the Confederation of British Industry. Deanne Julius, a British rate-setter from 1997 to 2001, worked at both Shell and British Airways; Andrew Sentance’s BOE service from 2006 to 2011 followed his own stint at Brit-ish Airways. Both, though, worked

for their companies as economists, rather than executives. I’m sure I’ve missed some examples from around the central-banking world, but the bottom line is that the expertise of entrepreneurs and executives isn’t being tapped to help steer the global economy, and that’s a missed opportunity. (The same argument applies to finance ministers, but I suspect asking businesspeople to stoop to the grubby world of politics is a step too far.)

So why not try persuading Bill Gates, Richard Branson, Elon Musk, Michael Dell, Lakshmi Mittal, Gior-gio Armani, Dave Geffen, Vincent Bollore or James Dyson to serve a term at a central bank? And while we’re at it, why not Elizabeth Hol-mes, the youngest self-made fe-male billionaire in the US, or Angela Ahrendts, poached from Burberry by Apple, or Marjorie Scardino, who ran the Economist magazine and then its owner Pearson until a few years ago?

Funo has been with Toyota since 1970. He’s currently a senior adviser to the car company’s board and, as well as heading its US operations, he previously ran Toyota’s non-Japan Asia business. He may turn out to be terrible at determining what the Japanese economy needs. But I’d much rather he had a shot at mak-ing economic policy than yet another university-trained economist who knows the coefficient of everything but nothing about the value of a factory floor.

Bankers shouldn’t run central banks

TAx lAW foR BuSInESSAtty. filamer D. Miguel

By David Cagahastian

Am b A s s A -dor Anto-nio L. Caba-

ngon Chua, founder of Aliw broadcast-ing Corp., was con-ferred the Lifetime Achievement Award by the Kapisanan ng mga brodkaster ng Pilipinas (KbP) for his contributions in the Philippine broadcast-ing industry, which helped shaped the na-tion’s history by keeping the Filipino people aware and informed of various issues of national importance. At the 23rd Golden dove Awards on Tuesday night, Cabangon Chua accept-ed the Lifetime Achievement Award and vowed to continue his advocacy of serving the nation through the timely and truthful delivery of information through media. “Ako po at ang aking mga kasamahan sa Aliw broadcasting Corp. ay taos-pusong nag-papasalamat para sa inyong ipinagkaloob na karangalan sa akin, at ito po ay aming susuklian ng dobleng pagsisilbi sa ating mga tagapakinig,” he said. Aliw broadcasting’s flagship radio station DWIZ was also awarded the best documentary Program on radio for its program Siyasat. The Golden dove Awards was estab-lished by the KbP to encourage the men and women in the broadcasting industry to strive for excellence. Gold stands for ex-cellence, while the dove is a symbol of the group’s aspirations. The panel of judges is chosen each year by the Awards and recognition Commit-tee, and composed of men and women of unquestionable credibility, proven integrity, honesty and impartiality. The panel comes from all walks of life, and includes people from academe and even students in mass communication. KbP President roberto J. Nicdao Jr. said that if there is one word that can describe a Golden dove award, that

A8

2ndFront PageBusinessMirror

www.businessmirror.com.phThursday, April 30, 2015

‘BM’ founderreceives KBPtop award

Summer heatseen pushinginflation fasterbeginning May

By Bianca Cuaresma

There is a higher than even chance that inflation, or the rate of change in prices, will acceler-

ate over the near term as April turns to May and, with it, the likelihood the already-scorching summer heat pushes higher the consumer price index (CPI), the Bangko Sentral ng Pilipinas (BSP) said on Wednesday. regulators refer to the term as an upside risk to indicate the likelihood that, while price pressures are at their weakest for now, prices could push higher going forward as the mercury lifts along with the summer heat. In the BSP’s latest inflation trend report, the monetary authorities iden-tified the upside risks to the country’s inflation outlook that had been classi-fied as benign for now. In particular, the central bank said the emergence of the el Niño phenom-enon and expectations of power short-ages due to a projected surge in demand for electricity were the leading risks to the inflation outlook. The BSP explained the el Niño—a geophysical anomaly that causes unusu-ally warm weather—has a 50-percent to 60-percent chance of occurring in the first five months, albeit at a weaker-than-expected intensity this year. “The emergence of a weak el Niño in the first half of the year could affect harvest,” the BSP said of a development that could adversely impact agricultural products’ prices down the line.

See “Inflation,” A2

CABANGON CHUA

See “BM founder,” A2