businessmirror december 13, 2014

This was sharply higher than the CI of only minus 26.3 percent a quarter earlier, and betrays the grow-ing confidence of consumers on the country’s economic prospects and their own financial standing. The BSP said the results of the latest quarterly consumer expec-tations survey (CES) show house-holds across the 7,100 islands making their sentiments known by opening their wallets no mat-ter the disappointment generated by local output, measured as the gross domestic product (GDP), averaging only 5.3 percent in the third quarter. CIs are computed as the per-centage of optimistic respondents minus the percentage of consumers

indicating otherwise. A negative CI for the quarter means that the number of optimists increased, but that pessimists continued to exceed the number of optimists during the period. Consumers cited stable com-modities prices, good harvests and expectations of higher earnings, represented by the 13th-month pay and the Christmas bonus, as major factors to the more optimistic out-look for the period. Other reasons cited for the more sanguine consumer outlook include good harvests and brisker business activity leading to higher household income during the period. The increasingly bullish outlook

By Bianca Cuaresma

Moderating and well-behaved inflation, as well as increased business activities in the run-

up to the long Christmas holidays, helped push the consumer confidence index (Ci) higher in the fourth quarter to minus 21.8 percent, the Bangko Sentral ng Pilipinas (BSP) said on Friday.

By Catherine N. Pillas

ISuzu Philippines Corp. (IPC) expects sales of the Isuzu mu-X, the firm’s flagship model in the

sport-utility vehicle (SuV) segment, to corner a bigger share of the Philip-pine market for SuVs in 2015. Company officials said consum-ers’ increasing preference for SuVs would boost sales of Isuzu mu-X. IPC President Nobuo Izumina said the company is targeting to sell 6,000 units of mu-X next year. Isuzu has so

far sold 1,200 units of mu-X since it was introduced in September. Joseph Bautista, IPC Sales Di-vision head, said Izusu is looking to aggressively market its “new family vehicle.” “The market is shifting to SuVs. If the pickup is seen as a lifestyle car, the all-utility vehicle as an everyday car, then the SuV is the new family car,” Bautista said. He said more motorcycle users, who are upgrading to cars and SuVs

See “Isuzu,” A8

Continued on a2

PESO ExchangE ratES n US 44.5770 n jaPan 0.3748 n UK 70.0929 n hK 5.7514 n chIna 7.2031 n SIngaPOrE 33.9402 n aUStralIa 36.7949 n EU 55.2621 n SaUDI arabIa 11.8774 Source: BSP (12 December 2014)

Isuzu sees higher sales for flagship mu-X in 2015

DeaDly superbugs may cost $100t by 2050

A broader look at today’s businessBusinessMirrorthrEE-tImE

rOtary clUb Of manIla jOUrnalISm awarDEE2006, 2010, 2012U.n. mEDIa awarD 2008

www.businessmirror.com.ph n Saturday, December 13, 2014 Vol. 10 No. 65 P25.00 nationwide | 6 sections 28 pages | 7 DayS a week

Q4 consumer confidence improves mODEratE InflatIOn, 13th-mOnth Pay anD bEttEr harVEStS bOOSt fIlIPInOS’ OPtImISm

World»B3-3

Drug-resistant superbugs could cost the global economy as much as $100 trillion between now and 2050, a threat that warrants as much attention as climate change, according to a review led by economist Jim o’neill. if unchecked, the infections

may mean 10 million extra deaths a year, with an impact on global wealth roughly equivalent to losing the united Kingdom’s economic output every year, o’neill, a former goldman sachs group inc. economist, told reporters in london on Wednesday.

PAPAL VISIT 2015

32 DAYSINSIDE

Life Saturday, December 13, 2014 D1BusinessMirrorEditor: Gerard S. Ramos • [email protected]

DEAR God, You prepared for the coming of Your son over the centuries. You awakened in the hearts of the pagans a dim expectation of this coming and

You prepared for it specifically through the Old Testament, culminating with John the Baptist who was the last and greatest of the prophets. We relive this long period of expectancy in the annual liturgical celebration of the season of Advent. May we be all prepared for the coming of Your son. Amen.

� e coming of Your Son

FR. SAL. PUTZU, SDB AND LOUIE M. LACSONWord&Life Publications • [email protected]

B JT N

A PERSON rendered almost catatonic by bliss is always a fascinating sight. Think of a kid who is ushered into a toy store with the blessing to get whatever he wants, or a collector walking into

a shop that specializes on what he has been collecting since puberty. They become overwhelmed, nearly out of their wits, not knowing where and how to start in this journey into their version of wonderland.

For homemakers and domestic divas, that wonderland could very well be Crate & Barrel, the international home furnishings retailer which opened its first store in the country recently at the fourth floor of the Mega Fashion Hall of SM Megamall in Mandaluyong City. You can just stay in a corner and watch as men and women who put a premium on time spent at home swoon over the offerings of the newly-opened store. “I’m in my Disneyland,” a 40-year-old female homemaker declared loudly enough during the opening of sprawling store.

With an ultra-spacious floor space at 2,000 square feet that is fully and judiciously utilized through the

store’s signature style of tasteful vignettes, with items stylishly clustered as they might appear in a home ready for its closeup, and with a whole store’s worth of fabulous collections, the comparison to the level of joy a kid derives from an amusement park visit is understandable.

Crate & Barrel, which has a dominant foothold in North America, has been around since the early 1960s, set up as a family business by Chicago couple Gordon and Carole Segal. They were inclined to sell exquisite yet affordable home items to couples just starting out, and during their honeymoon in Europe, the two saw items they wanted to bring to their store. Soon after, they struck a deal with European ateliers and factories to import products, which were shipped in the crates and barrels that inspired the name of the store. Since 1998, the company has been owned by the Otto Group of Hamburg, Germany, and has since expanded internationally in Canada, Dubai, Singapore, Mexico and now the Philippines.

According to April Young, International Head for Visual Merchandising of Crate & Barrel USA, dealing with the SM Retail Group through its subsidiary HMS Development Corp. sealed the deal in bringing the

renowned brand to the Philippines.“We started the international journey a couple of

years ago [in 2008] and we really don’t move forward internationally until we find just the right partner,” Young said, adding that more stores are primed to open in the first quarter of 2015. “We can’t wait to grow here.”

Young flew in to Manila to grace the opening along with Director of Construction John Moebes and other members of the team. SM Retail Director Felicidad Sy, SM Prime Holdings Inc. President Hans Sy, and SM Retail Chairman Tessie Sy-Coson welcomed them along with SM Executive Vice President for Controllership Ricky Lim, SM Retail Vice President for Business Development Pascale Jimenez and Crate & Barrel Philippines Business Unit Head Jo Co Siy.

“We are happy to announce that the first Crate & Barrel store in Manila is now open at the Mega Fashion Hall in SM Megamall,” Crate and Barrel Interim CEO Adrian Mitchell said in a statement. “In collaboration with our esteemed franchise partner, the SM Retail Group, we are bringing in the best of Crate & Barrel and creating an exciting new retail synergy in Manila.”

The items in the huge store are strategically clustered with evident emphasis on providing utmost

function and convenience to its customers. For example, along with spatulas and pans, cookbooks such as Nathan Williams’s The Kinfolk Table: Recipes for Small Gatherings and The Glorious Pasta of Italy by Domenica Marchetti are readily available in the kitchen area.

A quick end-to-end stroll of the store, which will have one passing the kitchen area items on to the living room needs, bathroom pieces and bedroom collection, several pieces are bound to catch one’s eyes. There are glasses of all shapes and sizes for all occasions and purposes, copper lanterns for outdoor functions, sofas for every type of guest and room profiles, and a plethora of choices of artful placemats, to name a few.

What’s more, the tags on the items contain information pertinent and helpful beyond how much of a dent they will have on your wallet—nothing too outrageous, to be sure, which is surprising given the quality of merchandise—and this includes the measurement, dimensions, functions, raw materials, where the item was made, even the name of the product’s designer. This, along with the superb service and even more superb collections, makes up the trademark service that is embedded with the highly regarded Crate & Barrel brand worldwide. ■

Christmas comes early for domestic divas

❶ THE first-ever Crate & Barrel store in the Philippines at the Mega Fashion Hall of SM Megamall

❷ PHILIPPINE Stock Exchange Director Vivian Yuchengco (center) and Ogie Villalon with SM Retail Group Chairman Tessie Sy Coson.

❸ GRACIOUS living comes to Manila with Crate & Barrel’s sleek Drake two-piece Sectional Sofa, Tourney Square Pull-out Coffee Table, Knox Bookcase and Parker Neutral Rugs.

❹ ENTERTAIN in style with Crate & Barrel’s Bird Bowl, Marbury Salad and Dinner Plates, Welcome Flatware with oxidized handle, Helena Cherry Napkin, Birdy Napkin Ring and Kendari Placemat.

❺ BRING music and art to your living spaces with Crate & Barrel’s Axis II Slipcovered Twin Sleeper sofa, Austin Media Console, Jaxon wall mirror and Tikiya Oil Painting on canvas.

❻ RICHLY textured Sierra Wardrobe with a Circlet Stand, Metal Circle on Stand and driftwood Root Wall Mirror.

❼ HOST a casual dinner party with this Pranzo II Vamelie Extension Table matched with Village, Jacob, and Sonata leather side chairs. Can seat up to 12 persons.

❽ CRATE & Barrel has everything you could want in your bedding and bed linens—from class to comfort and everything in between.

❾ CRATE & Barrel Head of International Visual Merchandising April Young, SM Retail Group Director Felicidad Sy (center), and SM Prime Holdings Inc. President Hans Sy launched the first Crate & Barrel store in the Philippines at the fourth level of Mega Fashion Hall in SM Megamall. Crate & Barrel Philippines Business Unit Head Jo Co Siy (left) and SM Retail Vice President for Business Development Pascale Jimenez (right) joined them in the simple ceremony.

➊

❷

❸

❹

❺

❻ ❼ ❽ ❾

ETIQUETTE OF TELLING

LOVED ONES WHAT YOU WANT »D2

ThE STrESS of ThE fESTIVE SEASoN

Saturday, December 13, 2014 D3

ParentlifeBusinessMirrorwww.businessmirror.com.ph

A wonderlAnd of fun and fashion welcomed everyone in the grand launch of nautica, desigual, and elle Kids, as the three brands unveiled their latest global collections for kids in a fashion show held recently at the SM Mall of Asia Atrium.

The brands are available at leading department stores nationwide. Kids and parents alike were delighted with the arrival of top kids’ fashion brands, all brought to the Philippines by Internationale Globale Marques (IGM), an affiliate of richwell Phils. Group of Companies, the leading distributor, manufacturer, and licensor of branded children’s products in the country.

“nautica, desigual, and elle Kids arrive in the Philippines each carrying a distinct style which kids of all ages can relate to. IGM is proud to bring these three top global kids’ fashion brands in the country, and we hope that these brands can be part of kids’

journeys as they explore fashion and build their own style personality,” IGM Coo Maye Yao Co Say said.

Guests got a first-hand look at the brands’ choice pieces with the product displays, which also featured elements that told each brand’s style story.

nautica’s beachside theme captured its love for adventure and the outdoors, including a sailboat on display.

desigual exhibited its eclectic charm with a wall filled with quirky artworks that speak of its creative vibe.

elle Kids embodied the spirit of Paris with a model eiffel Tower, which took guests right into the heart of the city that serves as the brand’s style inspiration.

each brand’s unique personality extended to the fashion show where the three brands paraded their latest collections.

nautica Kids opened the show with

its laidback approach to fashion. Casual pieces for both adventurous boys and girls ruled the ramp for the American brand. Quirky and eclectic distinguished desigual’s collection. The Spanish brand, which has become popular with its offbeat approach to casual clothing, presented its kidswear with humor-filled prints, patchwork designs, and innovative artwork.

Meanwhile, elle Kids exuded the easy and effortless sophistication of its Parisian roots. Kid models sashayed down the catwalk in prim and polished pieces—from pretty tops and dainty dresses for girls, and refined polos for boys.

The collection also included footwear rendered in playful yet elegant styles. The lineup captured the personality of the elle kid: chic, classy, and confident.

now, what parent wouldn’t want these qualities in their little angels?

By Priscilla DunstanDunstanBabyNewYork.com

WHILE we all like to imagine the holiday season as being a fun, loving and bonding experience, often our reality is quiet different. For many it is

a stressful time, with travel or guests, extra expenses, change in routine, and a sense of failure when our expectations of a blissful holiday are negated. Stressors like this also create havoc in our relationships with our partners, and this is often made worse by children who seem to suddenly start to misbehave. Children are sponges when it comes to their environment and often misbehavior around this time is simply a mirroring effect of what’s around them. By understanding their behavior and also how to help, you can get back to a more harmonious festive time.

Visual children will be aware of every frown and nasty look. Angry faces are scary for any child, but to the visual child even more so. Grab a pad and some crayon and sit down with them. What they draw will be a good indicator of either what they wish was happening, or their perception of why it is happening. When you see your child drawing pictures of sad and cross faces in the family home, it’s a good idea to check what your child is

seeing during your disagreements. A visual child is very conscious of others’ perceptions, so try your best to turn up and be pleasant in public and at events even if things are strained between you and your partner.

Tactile children will become more clingy when there is an upset in the home, and you may very well find yourself feeling very stretched with all the extra hugging, wrestling, sleeping with and cuddling demanded by your tactile child. In these situations, appeal to your tactile child’s love of activity and plan a few special trips to the park, play a game of basketball, or go bowling. Organize play dates and get them involved with what tasks you need to get done. If you need to cook dinner, have them help; if you need to write up a report for work, have them do some Internet research for you. This type of helping activity allows your child to be with you, but doesn’t make you feel stifled.

Auditory children listen to everything. If you have found that, even though you thought you were careful, your little one has heard your argument, it’s best to address it directly. Discuss the situation without blame. Acknowledge the less-than-desirable situation and explain that upsets happen to everyone, and what is more important is how we deal with them. Moving forward is what matters—use words to describe how to resolve a difference in opinion. Auditory children can be little parrots so it’s always best to address anything they

may have heard in a positive way, so that more problems aren’t created by a misheard conversation.

Taste and smell children seem to have an uncanny knack of knowing when there is a problem between parents, no matter how hard you try to hide it. They will tend to react by becoming clingy and difficult, almost as if trying to diffuse bad feelings, by having it be directed at them. Subconsciously, these children’s natural inclination to loyalty will lead them to prefer to take the blame themselves, rather than have someone they love get in trouble. It’s important to talk to your taste and smell child as a unit, and both show them that Mom and Dad still love one another, even when they have a difference of opinion. Children have a predisposition to self-blame and don’t have the life experience to know that a disagreement is a temporary situation that will be resolved. Be careful not to use your child as a sounding board for your own feelings and reassure them through age-appropriate explanation that people can sometime disagree when they love each other, but that the love is always there.

n Priscilla Dunstan is a behavioral researcher and creator of the Dunstan Baby Language and author of Child Sense and Calm the Crying. She currently works in New York as a behavioral consultant. Learn more about Dunstan at www.dunstanbabynewyork.com.

In celebration of national Teachers’ Month on September, PldT KaAsenso Cyberya (www.pldthome.com/cyberya) offered public school teachers a Cyberya package that gave them one month worth of free monthly service fee (P1,300) and free installation, originally priced at P1,100.

Cyberya is PldT KaAsenso’s offering for entrepreneurial Filipinos who are looking to start their own business. It’s an all-in-one Internet café package that allows users to surf the Internet for just P1. The package can be easily set up with two major requirements: a minimal capital investment and at least a barangay permit to operate.

“Internet access is now a basic need,especially in this digital age where almostanything and everything is online,” said Ariel Fermin, PldT executive vice president and head forHome business.

“PldT KaAsenso Cyberya has two-pronged objectives: while we help more micro-entrepreneurs to easily set up their own business, we will also pave the way for the democratization of Internet access especially for the Filipino youth.”

Acknowledging PldT KaAsenso Cyberya’s unique potential as source of additional income for the teachers, education Assistant Secretary Toni Umali said, “In partnership with PldT, Gabay Guro wants to empower teachers with the financial independence needed to build a better life for their families.” Gabay Guro is PldT-Smart Foundation’s flagship education advocacy project, working to help improve the quality of Philippine education by empowering its oft-unsung heroes—the teachers.

Style options for every kid’s personality

The stress of the festive season

A teAcher tries out “cyberya” as education Assistant Secretary toni Umali and executive Vice President and head for home Business Ariel P. Fermin explain the special cyberya offer to Gabay Guro teachers.

teachers empowered with livelihood opportunities

NAUtIcAeLLe DISIGUAL

pareNT LIFe D3

LIFe D1

chrISTmAS comES EArLY for DomESTIc DIVAS

Deadly drug-resistant bacteria The government says more than 23,000 people die from drug-resistant bacteria each year and 2 million develop serious infections from them. Some of the superbugs:

Bacteria Cases Deaths

© 2013 MCT

C. difficile (Clostridium difficile) 250,000 14,000

CRE (Carbapenem-resistant Enterobacteriaceae)

9,300 610

Drug-resistant Gonorrhea (Neisseria gonorrhoeae)

246,000 <5

Multidrug-resistant Acinetobacter 7,300 500

Drug-resistant Campylobacter 310,000 28

Drug-resistant Candida (fungus) 3,400 220

VRE (Vancomyin-resistant Enterococcus)

20,000 1,300

Multi-drug resistant Pseudomonas aeruginosa

6,700 440

Drug-resistant non-typhoidal Salmonella

100,000 40

Drug-resistant Salmonella 3,800 <5

Drug-resistant Shigella 27,000 <5

MRSA (Methicillin-resistant Staphylococcus aureus)

80,000 11,000

ESBLs (extended spectrum beta- lactamase producing enterobacteria)

26,000 1,700

Source: U.S. Centers for Disease Control and PreventionGraphic: Judy Treible

Urgent threats Serious threats



© 2013 MCT



9,300 610


246,000 <5





20,000 1,300


6,700 440


100,000 40




80,000 11,000


26,000 1,700





© 2013 MCT



9,300 610


246,000 <5





20,000 1,300


6,700 440


100,000 40




80,000 11,000


26,000 1,700



BUILDING TrUST president aquino is shown with korean president park Geun-hye at the 25th asean-republic of korea (rOk) Commemorative Summit 2014 in Busan, South korea, on Friday. Its theme, “Building Trust, Bringing Happiness,” reflected on rOk’s commitment to strengthen its relationship with asean through trust, which should result in happiness for the citizens of the asean and the rOk. The summit covered the review of the asean-rOk cooperation and its future direction, and the cooperation on nontraditional security issues, with emphasis on climate change and disaster-risk management. Story on A8. RyaN Lim / maLacañaNg Photo BuReau

BOJ. . . continued from a8

BusinessMirror [email protected] Saturday, December 13, 2014A2

News

Continued from A1

Christmas Crystal ball a storekeeper cleans a snow ball, one of the most sellable items in their store during this season. according to the storeowner, holiday shoppers have started snapping up most of the Christmas decoration items as early as september to avoid the Christmas rush. ALYSA SALEN

Chinese leaders acknowledge slower ’15 growth; vow reforms

Euro-area industrial output grows a less-than-forecast 0.1%

Chinese leaders have affirmed their commitment to a “new normal” of slower economic

growth next year and promised to promote market-oriented reforms and help the poor.

of consumers in the country mirrored the improved sentiment of households in Australia, China, Indonesia, Thailand and the US but was in contrast to the steady outlook in the euro area and the less optimistic views of consumers in Japan, South Korea, Taiwan and the UK. Consumer sentiment for the quarter ahead also finally pushed higher to positive territory, averaging 0.7 percent. Consumer confidence also rose across the three indicators the central bank measures, namely, the country’s economic condition, the households’ family financial conditions and family income. “Consumers’ confidence on the country’s economic condition improved in the current quarter and next quarter but weakened for the year ahead. Similarly, consumers anticipated their family financial conditions to be more favorable for the current quarter and next quarter and to be stable for the year ahead compared to the previous quarter’s survey results. Their outlook on family income in the current quarter was broadly unchanged but improved for the next quarter and the year ahead. The improved outlook across the three indicators was attributed by respondents to expectations of brighter job prospects, stable prices of commodities, additional income and lower debt payments,” according to the BSP. Likewise, consumer confidence improved across all income groups—particularly among low-income and high-income groups. The high-income group continued to be the most optimistic among all types of income groups. “The outlook of the low-income group improved for the current quarter and next quarter, but sentiment for the year ahead broadly weakened. The middle-income group consistently reported improvement in consumer confidence for the current quarter and next quarter, as well as for the year ahead. Meanwhile, the sentiment of the high-income group increased in the current quarter but held steady for the next quarter, and the year ahead. These suggest that improvement in consumer outlook was broad-based “evident across income groups” with the middle-income group showing the biggest improvement in sentiment. The high-income group continued to be the most optimistic,” the BSP said.

An official statement on Friday following an annual planning meet-ing led by President Xi Jinping gave no gross domestic product (GDP) growth target for 2015. But private-sector economists expect it to be lowered to 7 percent from the 7.5- percent level of recent years. The statement listed five goals, including keeping the economy stable and finding new sources of growth, making industry more ef-ficient, speeding up agricultural

development and raising incomes. It warned China faces “downward pressure” on growth due to weak global demand and “increasing dif-ficulties for business.” The plan is the latest stage in ef-forts by communist leaders to steer the world’s second-largest economy to more sustainable, environmen-tally friendly growth based on do-mestic consumption and technology instead of trade and investment. Growth tumbled to a five-year low

of 7.3 percent in the quarter ending in September, barely half the 14.2 percent high of 2007. Chinese lead-ers have expressed confidence they can manage the slowdown but, in a sign they might worry it is deepen-ing too sharply, unexpectedly cut interest rates on November 22 in an effort to prop up growth. China must “understand the new normal, adjust to the new normal and develop under the new normal,” the statement said. The phrase “new normal” became an official catchphrase after Xi used it in May to describe the transition to slower growth. The official Xinhua News Agency noted he was invoking a term first popularized by Pimco, the giant US-based bond fund manager, to describe slower global growth after the 2008 crisis. Analysts say the Chinese leadership is comfortable with slower growth so long as the economy generates enough

new jobs to avert a spike in unemploy-ment and possible unrest. “We believe these considerations will lead the government to set a slightly lower 7-percent GDP growth target for 2015, and refrain from us-ing major stimulus policies,” said UBS economists Tao Wang and Harrison Hu in a report. Beijing is likely to encourage oil imports to take advantage of lower global prices while also promoting outbound investment and trade via its new “Silk Road” initiatives to ex-pand transport links with China’s neighbors, Wang and Hu said. The leadership under Xi has promised to give market forces and entrepreneurs a bigger role in the state-dominated economy and to open more industries to private competition. But they have yet to make major changes, which has prompted suggestions reforms face resistance within the ruling party to

efforts to reduce the monopolies and other privileges of state industry. In a sign of economic weakness, customs data this week showed November export growth tumbled and imports contracted unexpectedly, suggesting domestic demand is anemic. Analysts expect reforms over the coming year to focus on reducing ex-cess production capacity in industries including steel and overhauling en-ergy policy to promote conservation. Chinese leaders “acknowledged overcapacity among traditional in-dustries” and “unsustainable envi-ronmental damage,” said Citigroup economists Minggao Shen and Sh-uang Ding in a report. Chinese leaders will also need to wrestle with heavy debts owed by local governments and state com-panies that have prompted unease about the health of the state-owned banking system if slower economic growth causes a rise in defaults. AP

said in a Bloomberg TV interview on Friday. “It’s also an affirma-tion of the efforts we’ve done over the years to implement structural reforms and make the economy more resilient.” Bangko Sentral ng Pilipinas on Thursday kept the rate it pays lenders for overnight deposits at 4 percent, as predicted by all 17 economists in a Bloomberg survey. The peso closed down 0.2 per-cent on Friday and 0.12 percent this week to 44.58 a dollar, prices from Tullett Prebon Plc. show. The Philippine Stock Exchange Index rose 2.2 percent, the sharpest gain since October 2, 2013, on specu-lation Moody’s move will attract more investors. Bloomberg News

Officials want to avoid creating a perception that the central bank will take action simply when oil prices fall, the people said. The October 31 easing demonstrated the BOJ’s commitment to achieving its price target, they said. The BOJ lowered its forecasts for inflation for the year through March and the following 12 months on October 31. At that meeting, the policy board de-cided in a 5-4 vote to increase the pace of asset purchases that gives the bank room to buy from the market every new bond issued by the finance ministry. The world’s third-biggest economy contracted for a second straight quarter in the three months through Septem-ber, according to data released after the BOJ’s decision, putting Japan in its fourth recession since 2008. The bank wouldn’t automatically ease even if the outlook was lowered, board member Sayuri Shirai said last month. Shirai, who voted with the ma-jority to ease further in October, said that the decline in oil prices would have positive economic effects and this would push up prices. Board member Takehiro Sato, who voted against further easing in October before supporting a decision to maintain the policy at a subsequent meeting, said this month that lower oil prices would exert downward pressure on prices, al-though in the longer term they would have positive economic effects. The BOJ signaled following its October 31 meet-ing that it was ready to ease further if needed to support inflation expecta-tions that have been affected by oil prices, said Hideo Kumano, an econo-mist at Dai-ichi Life Research Institute and a former BOJ official. Bloomberg News

EURO-AREA industrial production barely grew in October, indicating a weak start to the fourth quarter as the European

Central Bank (ECB) considers new ways to revive the economy. Industrial output in the 18-nation region rose 0.1 percent, less than the 0.2-percent increase forecast by economists in a Bloomberg News sur-vey. The data from Luxembourg-based Eurostat also showed production was up 0.7 percent from a year earlier. ECB President Mario Draghi has said risks to the economy are on the downside, and Fri-day’s data may do little do alleviate concerns about the outlook. A round of long-term loans to banks on Thursday came in at the low end of analysts’ estimates, and the ECB will consider a quantitative-easing package at its next meeting in January. “After the disappointing TLTRO take-up, the

only small improvement in industrial activity seems insufficient to deter the ECB from an-nouncing a sovereign bond-purchase program in January,” said Peter Vanden Houte, an economist at ING Bank NV in Belgium. The report tallies with surveys from Markit Economics, which have shown manufacturing weakening through 2014. Markit will publish its factory index for this month, along with its services measure, on December 16. According to Eurostat, the drop in produc-tion in November was led by energy, down 1.9 percent, and capital goods, which fell 0.2 per-cent. It said output declined in France, Spain and Italy, while it stagnated in Germany, the region’s largest economy. In a separate report, Eurostat said employment in the euro area rose 0.2 percent in the third quar-ter after a 0.3-percent increase in the previous three months. Bloomberg News

Philippine bonds in biggest weekly gain in 14 months on upgrade

Continued from A8

Korean air Chairman Cho yang-ho (center) bows at the company’s head office in seoul, south Korea, on Friday for the behavior of his adult daughter who delayed a flight in an incident now dubbed “nut rage.” Cho hyun-ah, the Korean air lines Co. ltd. chairman’s daughter and executive who delayed a flight, also bowed deep in apology on Friday before facing questioning by transport officials. her father said he regrets he didn’t raise her better. the apologies came in response to simmering public anger about the incident and the airline’s handling of it. Cho hyun-ah was angered when a flight attendant in first class offered her macadamia nuts in a bag, not on a plate. she ordered a senior crew member off the plane, forcing it to return to the gate at John F. Kennedy airport in new york City. AP/LEE JiN-mAN

Korean air chairman, daughter sorry for nut rage

Q4 consumer confidence improves

Roxas made the announcement in his first appearance at the Na-tional Police general headquarters in Camp Rafael Crame, Quezon City, two days after his office served the Ombudsman order placing Purisima on six months’ preven-tive suspension. In naming Espina as the OIC of the National Police, Roxas said he was making sure that there would be no disruption in the police orga-nization and in the services that it

was administering, particularly on the campaign against criminality. While acknowledging that the force is in a unique situation as a result of the suspension of Puri-sima, which Roxas declined to comment on further, he said the organization is strong and solid, and there is “no interruption in the chain of command.” “Dindo Espina is the OIC, and there should be no interruption. There should be no doubt when it

comes to the implementation of or-ders in the national headquarters,” Roxas said. Espina, who is Purisima’s class-mate at the Philippine Military Academy (PMA), is currently the No. 3 man in the police force, being the deputy chief for operations. Espina belonged to the top 10 percent of PMA Class of 1981, while Purisima belonged to the lowest 10 percent.

The second-highest position in the organization, deputy chief for administration, has been vacated following the retirement of Deputy Director General Felipe Rojas on Fri-day last week. With the retirement of Rojas, it is expected that there would be a major movement of rank and po-sitions in the force, with Espina seen to inherit the post that was vacated by Rojas. However, Roxas said there had been no promotions and designa-tions yet, and it is up to President Aquino to make the announcement. He said the force must not be affected by the suspension of its chief, and should continue its work by focusing on its law-enforcement activities, particularly that the coun-try was beset by a series of events during the past days, including the bombing of an RTMI bus in Bukidnon province on Wednesday, wherein 10 passengers were killed. The country is also busy prepar-ing for the visit of Pope Francis early next month. Roxas said despite Purisima’s suspension, he can still return after

serving it. The Ombudsman ordered the suspension of Purisima over the contract that the Philippine National Police entered with courier company Werfast, which was tapped to deliver licenses and permits of gun holders. Early this week Purisima asked the Court of Appeals to stop his suspension. He claimed that the implementa-tion of the suspension order by the Department of the Interior and Lo-cal Government (DILG) was “illegal and without basis, as the National Police is not administratively under the DILG.” He claimed that the Ombuds-man’s order should have been im-plemented by the Napolcom, which exercises administrative control and supervision over the force. Roxas is the ex officio chairman of the Napol-com, being the interior secretary. Meanwhile, Senate President Franklin Drilon said that, with two momentous events facing the coun-try next year—the papal visit and the Asia-Pacific Economic Coopera-tion Ministerial Meetings and Sum-mit—President Aquino must finally

decide Purisima’s fate. “You know, it is time that the President decides Purisima’s fate because during the next month, in 2015, there are two big events in the country—the arrival of Pope Fran-cis in January and the Apec minis-terial meeting and summit halfway through the year,” Drilon said. “In an organization such as the National Police, where authority and leadership is strictly observed, Purisima’s suspension would turn the force into a ‘headless’ body,” said Drilon, a close ally of Mr. Aquino. He said that such big events re-quire constant security monitoring that would need, not an OIC, who has limited powers, but a regular head with full authority. He said an OIC could not appoint any personnel or implement a re-shuffle. “Tali ang kamay ng kung sino man ang OIC ngayon—si General Es-pina yata—ngayong lalo pa na kailan-gan nating pag-igtingin ang seguridad sa susunod na taon.” “The President must decide a re-placement now, at the very least not an OIC but an acting National Police chief.” With Recto Mercene

By Rene Acosta

INTERIOR Secretary Manuel Roxas II, in his capacity as chairman of the National Police Commission

(Napolcom), on Friday designated Deputy Director General Leonardo Espina as officer in charge (OIC) of the National Police to prevent disruption in the police service as a result of the suspension of Director General Alan Purisima.

[email protected] Editor: Dionisio L. Pelayo • Saturday, December 13, 2014 A3BusinessMirrorThe Nation

SUNRISE SUNSET

6:11 AM 5:28 PM

MOONRISEMOONSET

11:00 AM 11:11 PM

TODAY’S WEATHERMETROMANILA

LAOAG

BAGUIO

SBMA/CLARK

TAGAYTAY

LEGAZPI

PUERTOPRINCESA

ILOILO/BACOLOD

TUGUEGARAO

METROCEBU

CAGAYANDE ORO

METRODAVAO

ZAMBOANGA

TACLOBAN

3-DAYEXTENDEDFORECAST

3-DAYEXTENDEDFORECAST

CELEBES SEA

LEGAZPI CITY24 – 30°C

TACLOBAN CITY24 – 31°C

CAGAYAN DE ORO CITY

METRO DAVAO25 – 33°C

ZAMBOANGA CITY24 – 32 °C

PHILI

PPIN

E ARE

A OF R

ESPO

NSIB

ILITY

(PAR

)

SABAH

PUERTO PRINCESA CITY 24 – 30°C METRO CEBU

24 – 30°C

ILOILO/BACOLOD

25 – 31°C

22 – 31°C

24 – 31°C 23 – 31°C 23 – 30°C

24 – 30°C 24– 29°C 24 – 29°C

23 – 31°C 24 – 30°C 24 – 31°C

25 – 33°C 24 – 32°C 23 – 33°C

25 – 33°C 25 – 33°C 25 – 34°C

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

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

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

www.panahon.tv

@PanahonTV

DECEMBER 13, 2014 | SATURDAY

HIGH TIDEMANILA

SOUTH HARBOR

LOW TIDE

9:26 AM-0.02 METER

TUGUEGARAO CITY 22 – 29°C

LAOAG CITY 23 – 29°C

TAGAYTAY CITY 21 – 28°C

SBMA/CLARK 23 – 31°C

23 – 31°C 22 – 30°C 23 – 30°C

21 –28°C 21 – 28°C 22 – 28°C

22 – 30°C 22 – 31°C 21 – 30°C

14 – 22°C 13 – 21°C 14 – 23°C

21 – 29°C 22 – 29°C 22 – 28°C

23 – 29°C23 – 29°C 22 – 28°C

24 – 31°C 23 – 31°C

DEC 14SUNDAY

23 – 30°C23 – 30°C 24 – 31°C

25 – 32°C25 – 32°C 24 – 31°C

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

Cloudy skies with rain showersand/or thunderstorms.

HALF MOON

8:51 PMDEC 14

BAGUIO CITY15 – 22°C

23 – 31°C

FULL MOON

8:27 PMDEC 06 1:17 AM

0.84 METER

Partly cloudy to cloudy skies withisolated rain showers

DEC 16 TUESDAY

DEC 15 MONDAY

DEC 14SUNDAY

DEC 16 TUESDAY

DEC 15 MONDAY

Light rains

Low Pressure Area (LPA) develops when warmand moist air rises from the Earth’s surface.

Northeast Monsoon locally known as “Amihan”. It a�ects the eastern portions of the country.

It is cold and dry; characterized by widespread cloudiness with rains and showers.

(AS OF DECEMBER 12, 5:00 PM)

.

NORTHEAST MONSOON AFFECTINGNORTHERN LUZON.

.

LOW PRESSURE AREA (LPA) WAS ESTIMATED AT 1,040 KM

EAST OF SURIGAO CITY.

METRO MANILA23 – 32°C

Espina assumes command of Natl Police

By Joel R. San Juan

THE Commission on Elections (Comelec) is set to investigate the presence of digital lines on the ballot images in the Precinct Count Optical Scan

(PCOS) machines that were used in previous elections. In a press briefing, Comelec Chairman Sixto S. Bril-lantes Jr. disclosed that the investigation is necessary to avoid repeat in the coming 2016 elections. Brillantes said the investigation will cover 383 polling precincts that will be randomly selected from

various provinces by the Digital Lines Committee re-cently formed by the poll body. The digital lines are those found in the ballot images, which are stored in the PCOS machines, of which some were found passing through ovals of candidates that are being marked by voters. Such lines could either result to additional votes for particular candidates or nullify votes for some candidates in cases of overvoting. But Brillantes quickly denied that these digital lines have affected the results of previous elections.

“It is possible, but highly improbable. This is because we have already seen in the election protest cases that the presence of digital lines did not adversely affect the results of the voting,” the Comelec chief said. Bril-lantes said known PCOS critics Margarita “Tingting” Cojuangco, the aunt of President Aquino, and Melchor Magdamo, who once worked at the Comelec, among others, will be invited to witness the investigation. It can be recalled that the Automated Election System (AES) Watch claimed that there was an elec-tronic vote-shaving and -padding done in the 2013

polls through the use of “digital lines” that appeared in the PCOS machines. The AES Watch accused the Comelec of trying to hide the issue on digital lines from the public. Brillantes, however, stressed that they were actually the ones who discovered the presence of the digital lines in nine polling precincts, and reported it to the Department of Science and Technology. Brillantes said they would try to come up with their findings before the year ends, or prior to to the refurbishing the PCOS machines.

Comelec to probe digital lines in PCOS

ballot images

ESPINA

By Henry E. Empeño

FREEPORT AREA OF BATAAN—The Authority of the Freeport Area of Bataan (Afab) has re-

corded P84.27 billion worth of new investments in just the first 10 months of this year, as more foreign and domestic companies continue to locate in this emerging manufacturing hub.

Bataan free port gains P84.27-B new investments

Afab Chairman and Administrator Deogracias Custodio said in a news briefing here on Thursday that his office has signed 17 new business proj-ects that surged investment pledges here from just P2.19 billion last year to a total of P84.27 billion this year.

“We still have a long way to go as an IPA [investment promotion agency], but we’re in the right direc-tion,” said Custodio, a law and eco-nomics graduate of the University of the Philippines, who took over the reins of Afab in 2010.

He added that, with China be-coming less competitive for manu-facturing and with the push toward Asean integration, the Bataan free port has been reaping the benefits of investors’ quest for a manufactur-ing center from where they can also efficiently distribute their products in the region.

“And FAB [Freeport Area of Bata-an] has been primed precisely for that: We have much lower power and water rates, and we have the biggest Techni-cal Education and Skills Development Authority-accredited labor pool,” Cus-todio added.

The bulk of the new business commitments at the FAB was pledged by GN Power Mariveles Coal Plant Ltd. Co. (GMCP), which will pour in about P80 billion to build an additional 1,200-mega-watt (MW) unit for the 600-MW Mariveles Power Plant. The ex-pansion will be undertaken by the Ayala Group, which has recently acquired a 17-percent stake in GMCP, which, in turn, is major-ity-controlled by private equity fund Sithe Global Power Llc. of the Blackstone Group.

Meanwhile, among the new busi-ness entrants at the Afab, Custodio mentioned in particular the business outsourcing firm Grand Innovasia Concept Corp. (GICC), Perpetual Prime Manufacturing Inc. (PPMI), and Seasia Nectar Port Services (SNPSI) as the bigger investment

projects. Custodio said GICC is now developing an information technol-ogy park for BPO and online interac-tive gaming and will break ground for its facilities on December 16.

PPMI, which is set to manufacture high-end footwear brands for Stella International, has already hired 20 to 30 workers, and will send some of them to Vietnam for training as team leaders.

Meanwhile, SNPSI is eyeing the nearby Baseco port area for break-bulk shipments, with companies engaged in cement, glass and steel manufacturing and distribution as anchor clients. The company is scheduled to start operation in 2016 and is set to engage in handling bulk liquid and dry cargoes, refrigerated warehousing, stevedoring, lighter-ing, towing and storing of cargo.

Custodio said the presence of SNPSI will help reduce the cost of shipping at the FAB and also help attract more investors to locate here.

He added that the new invest-ment projects are expected to gener-ate around 5,000 new jobs, boost ex-port earnings, and further promote FAB as the fashion manufacturing hub of the Philippines. FAB grew its roots from the former Bataan Export Processing Zone, which first enlisted popular garments and footwear manufacturers like Levi’s and Reebok.

According to figures compiled by the authority, FAB now has 98 registered locators comprised by Korean, Taiwanese, Chinese, Ameri-can, Japanese, British, Bahrainese, French and German firms. As of November, these companies now employ a total of 19,379 workers, compared to the total employment figure of 17,490 last year.

Meanwhile, export earnings by the companies stood at $348.8 million as of November, which represented a slight decrease from the $402.4 million reported in the same period last year.

Meat season a butcher chops a chunk of meat for a customer at a Las Piñas City market on Friday. the government has reported that the price of meat, poultry and vegetables has remained stable, despite the onslaught of typhoon Ruby early this week and an expected spike in demand this holiday season. NoNie Reyes

WITH the Supreme Court (SC) order shutting down the Pandacan oil depot,

the Metro Manila Development Authority (MMDA) may have to spare fuel tankers from the truck ban to expedite the delivery of vital petroleum products from Batangas and Bataan, the LPG Marketers’ As-sociation (LPG-MA) said on Friday.

“The MMDA may have to exempt fuel-tanker trucks from the road ban, if only to avoid supply disrup-tions, which may be exploited by abusive traders as an excuse to prop up pump prices, or to delay further price rollbacks,” said House Dep-uty Minority Leader and LPG-MA

Party-list Rep. Arnel Ty.The MMDA forbids trucks from

Metro roads from 6 to 9 a.m. and from 5 to 9 p.m. every day, except Sundays and on holidays.

Oil companies have been rolling back pump prices on account of the 40-percent drop in the cost of crude oil in world markets since June.

However, Ty expressed concern that profiteers might take advan-tage of supply chain glitches due to the closure of the Pandacan depot as a pretext to keep pump prices elevated.

Ty was responding to the warning issued by the Department of Energy (DOE) that fuel prices may rise after

Pilipinas Petroleum Corp., Petron Corp. and Chevron Corp. (formerly Caltex Philippines Inc.) wind down their Pandacan operations to comply with the SC order.

The extra cost factor will come from the “big three” having to ob-tain their bulk supplies by road using tanker trucks, instead of sea-based barges, from their oil refineries and terminals in Batangas and Bataan, according to DOE Undersecretary Zenaida Monsada.

“Prices may be affected, consider-ing the difference in transport costs using a truck compared to a barge,” Monsada said.

Monsada said some 70 percent

of petroleum products in Luzon, including Metro Manila, come from the 33-hectare Pandacan depot in Manila, where the big three have been running storage facilities and distribution terminals.

Monsada sees one to two days of lag time in the road transfer of oil products from Batangas and Bataan.

The SC finally ordered the re-location of the Pandacan depot, saying it puts Manila residents at grave risk in the event of a terror-ist attack.

The November 25 ruling struck down as unconstitutional Manila City Ordinance 8187, which provided for the depot’s continued operation. PNA

Solon seeks truck-ban exemption for fuel tankers

ENERGy Secretary Carlos Jericho L. Petilla is targeting to increase the Interruptible

Load Program (ILP) capacity to 1,000 megawatts (MW) from its current 600-MW signed capacity in prepa-ration for the Luzon-reserve deficit for the summer of 2015.

“Right now, we have 600 MW [from ILP participants], we’d like to raise it to over a thousand,” Petilla told reporters.

He pointed out that the signed ca-pacity will not run for a full 600 MW and will only run at 300 MW, since ILP’s cannot run for an entire day. ILP capacity comes from the power

generated by the establishments.Based on records as of Decem-

ber 8, the ILP’s confirmed capacity from the Retail Electricity Sup-pliers Association (Resa) reaches 401.5 MW, while Manila Electric Co.’s (Meralco) committed capacity amounts to 195.2 MW for a total of 596.7 MW.

Also, Meralco’s potential captive market amounts to 59.85 MW, while Resa’s potential is at 36.49 MW.

Petilla further said the De-partment of Energy (DOE) is only considering the capacity from signed participants.

He also lauded the passing of

emergency powers, saying it is vital for the stabilization of power rates since it will subsidize the Meralco supposedly pass-on charges.

“The assurance is that the public will not pay for the additional com-pensation for ILP...so the participat-ing companies will not be scared,” he said.

Moreover, the energy chief pointed out that the subsidy, ap-proved for the emergency powers, will also increase the number of ILP participants, as he reiterated his earlier position for the early passage of the bill granting emer-gency powers to President Aquino.

Under the current congressional proposal, the Malampaya fund will be used to pay for the ILP charges.

On the other hand, Petilla noted that the Senate cannot be blamed for scrutinizing the details of the emergency authority.

He added that the DOE wants to change the provision for the conditions of running ILP, so that it can prevent brownouts from occurring.

“In the congressional version, there is room for us to [craft] imple-menting rules and regulations so that, even before brownouts, it will run,” he said. PNA

Energy dept sets 1,000-MW ILP target for next year

Saturday, December 13, 2014 • Editors: Vittorio V. Vitug and Max V. de Leon

EconomyBusinessMirrorA4 [email protected]

the building that houses offices of the authority of the Freeport area of Bataan overlooks the freeport zone in Mariveles town.

By Lorenz S. Marasigan

THE government has once again extended the dead-line for the submission of

bids for the P2.5-billion Integrated Transport System (ITS) Southwest Terminal, a transport official said.

Transportation Undersecretary for Legal Affairs Jose Perpetuo M. Lotilla said the Department of Transportation and Communi-cations has decided to move the deadline for the submission of bids

to December 22 from December 12, due to requests from bidders.

“Prospective bidders requested for more time to prepare bids,” he said in a text message.

The tender was initially sched-uled on May 15, but was resched-uled to June 16 to give ample time to bidders to finalize their bids. But changes were made in the con-tract to increase investor appetite, thus forcing the agency to post-pone the bidding to August 30.

It was then moved to September

29, but another round of revi-sion on the project structure was made, hence an indefinite postponement.

The government then decided to set the bid submission to December 1, almost a year after the deal was put to the auction block in 2013.

The December 22 deadline is expected to be the last postpone-ment of the bid submission date.

Twelve firms are participating in the bidding for the contract to

develop a facility to connect pas-sengers coming from Cavite to Metro Manila transportation sys-tems, such as the Light Rail Tran-sit (LRT) Line 1, city buses, taxis and other public-utility vehicles.

The investors are: D.M. Wenc-eslao and Associates Inc.; Ayala Land Inc. and Ayala Corp.; Metro Pacific Tollways Corp.; San Miguel Corp.; Vicente T. Lao Construc-tion; Egis Projects Philippines; Robinsons Land Corp.; Filinvest Land Inc.; Megawide Construction

Corp.; States Properties Corp.; Expedition Construction Corp.; and Altus San Nicolas Corp.

The Southwest Terminal proj-ect, which will be constructed in 2.9-hectare area near the Ma-nila-Cavite Toll Expressway, will connect passengers coming from Cavite to urban transport systems in Metro Manila.

It will include a passenger termi-nal building, arrival and departure bays, public information systems, ticketing and baggage handling

facilities and park-ride facilities.The government has awarded

eight contracts since the infra-structure program’s inception in 2010. It aims to sign at least 15 contracts by the time President Aquino steps down from office in 2016.

The state intends to plug the gap in the country’s transportation infrastructure in the next decade by rolling out massive infrastruc-ture projects that are seen to spur economic growth.

DOTC again extends submission of bids for ITS Southwest Terminal deal

With the increasing number of holdup incidents involving taxi driv-ers, National Capital Region Police Office (NCRPO) Chief Supt. Carmelo Valmoria ordered all five district di-rectors of Metro Manila to conduct checkpoint operations at night in their area of responsibility to stem rising criminality.

Valmoria said they are now closely monitoring all taxis in Metro Manila amid a notable rise of holdup and robbery incidents in-volving taxi drivers.

the NCRPO chief said aside from keeping a close watch on riding in tandem criminals, police have been alerted about the series of taxi hold-ups taking place lately.

Valmoria sought the cooperation of the riding public and motorists, saying that he was pretty sure that the general public would not mind the checkpoints, since the same was being conducted to ensure their safety.

At the same time, he appealed to taxi riders and all the commuters, in general, to stay alert in commuting or taking a ride of public transportation, such as buses, jeepneys and taxi, or the Metro Rail transit Line 3 and Light Rail transits.

he also said that the riding pub-lic should not only keep an eye on snatchers, robbers, the so-called ipit taxi gang, but as well as the Salisi gang, Siksik gang, Riles gang, Budol-budol gang, Condo Criminal gang, Solicit Gang, among others. PNA

the Metropolitan Manila Develop-ment Authority (MMDA) will dis-patch shuttle services going to the Ninoy Aquino international Airport terminals 2, 3 and 4 (formerly Do-mestic Airport) starting Monday as part of its 12 Christmas traffic-miti-gating measures.

MMDA Chairman Francis tolentino said that aside from providing con-venience to passengers, this measure is aimed at reducing the number of vehicles going to the airports, which is expected to increase as Christmas approaches. “instead of these passengers utiliz-ing their own private cars or cabs to bring them to the airport, they can go as a group by availing [themselves] of the free airport shuttle service we are providing,” he said. Six public-utility buses, includ-ing electric-powered units, identifi-able by stickers bearing the words “MMDA’s Airport Christmas Shuttle,” will be dispatched to Baclaran and SM Mall of Asia as pickup points. “the airport shuttle service will be free of charge for passengers only. they just need to show their airline tickets to avail [themselves] of the service,” tolen-tino said. “We are targeting the travel-ers expected to go to the provinces to spend the holidays.”

Last week the MMDA, with the cooperation of public-utility bus op-erators, dispatched similar shuttle services to six major malls along edsa to provide hassle-free and safe trans-portation to mall employees and late-night shoppers. the airport shuttle service will last until December 23. Claudeth Mocon-Ciriaco

briefsncrpo chief orders

taxi-checkpoint operations

MMda to provide free airport shuttle service

AEC may encourage ‘brain gain’ in member-countries

By Cai U. Ordinario

The Philippine economy stands to benefit from the possible “brain gain” under the Asean

economic Community (AeC), which will take effect in January 2016.

As a known labor-exporting country, the Philippines, like most emigrating countries in the region, suffered from “brain drain,” as pro-fessionals and academicians leave the country for better work oppor-tunities abroad.

However, in a discussion paper, titled “Prospects and Challenges of Brain Gain from Asean Integration,” Philippine Institute for Development Studies (PIDS) Director for Research Information Sheila Siar said the AEC could reverse this trend.

“The Asean economic integration in 2015 can be viewed as an oppor-tunity for brain gain for the Asean member-countries,” Siar said.

“[This] can offset the losses from brain drain experienced by emigra-tion countries in the region, and facilitate knowledge exchanges and collaboration and economic and busi-ness linkages, all of which are benefi-cial for the Asean and its member-countries,” she added.

Siar said there are three ways by which a brain gain can occur

in emigrating countr ies l ike the Philippines.

These are the growth of cross-border education in the region; increased labor mobility in the Asean through mutual recogni-tion arrangements (MRAs); and the migration of Asian expatriates to the Asean.

Siar said, coupled with a more vibrant economy that provides at-tractive compensation packages in destination, Asean countries could boost movements of international students and workers, as well as promote the exchange of advanced technologies.

“It may [also] benefit Asean to allow dual citizenship, as it could facilitate the movement of finan-cial and human capital into the member-countries and the South-east Asian region as a whole. The portability of social-security ben-efits should also be pursued, as this promotes return migration and labor mobility, which will enhance

circular flows of human capital, investment and technology to the advantage of the Asean member-countries,” Siar added.

However, Siar cautioned that if the education sector in Asean countries continue to struggle with language issues, underdeveloped tertiary education and low innova-tion capacities, a brain gain may not be possible.

Other factors that may prevent a brain gain from occurring includes the low competitiveness rank-ings of some Asean countries. This makes countries less attractive as labor destinations.

“Given these issues, the more ad-vanced economies in the region will have more advantage in exploiting the opportunities of Asean integra-tion during the initial years of the AEC. Prominent economist Joseph Stiglitz expressed the view that the Asean integration could even lead to more brain drain for the poorer countries in the region,” Siar said.

OIl firms are expected to implement a downward adjustment in the prices of

petroleum products this weekend or early next week.

Industry sources said the adjust-ment could be as high as P1.50 per liter for both gasoline and diesel.

It can be recalled that fuel prices plunged by an average of P2.50 per liter last week, the biggest downward adjustment so far for the year.

On December 7 the oil firms re-duced the price of gasoline by P2.50 a liter and P2.25 a liter for diesel and kerosene.

According to the Department of Energy (DOE), this was the 23rd rollback in gasoline prices, 30th for diesel and kerosene for the year, re-spectively.

To date, gasoline prices decreased by P10.74 per liter, P12.13 per liter for diesel and P12.42 per liter for kerosene.

The oil firms import at least 90 percent of their fuel requirements.

The price rollback reflects the con-tinued softening of prices of crude oil and petroleum products in the world market.

Earlier, the Organization of Pe-troleum Exporting Countries (Opec) decided to hold output steady despite several months of decline in the price of crude oil.

Also, the lower energy demand has translated to downward price adjustments over the past few weeks.

The Department of Energy (DOE) said crude-oil prices have plunged anywhere from $74 to $77 per barrel on account of in-creased crude exports of Saudi Arabia despite signs of an over- supplied market.

“Also, Opec producers appeared divided ahead of its November 27 meeting in Vienna to discuss out-put. Opec heavyweight Saudi Ara-bia has so far shown no indication that it will support a reduction in Opec production as planned by other Opec members. Venezuela and Ecuador have called publicly for a cut, while Iran has hinted at a need to reduce output as oil- producing countries see their incomes slide,” the DOE said on its web site.

It also noted that Asian gaso-line supply remained sufficient, amid steady regional production and even as barrels of blending components from Europe head to Asia. Lenie Lectura

By Kris M. CrismundoPhilippines News Agency

GNPower Mariveles Coal Plant ltd. Co. targets to start the construction of a 1,200-megawatt (MW) power plant here

by the first half of next year.GNPower Community Relations Manager Ro-

berto B. Racelis Jr. told reporters during a media tour in its 120-hectare lot inside the Freeport Area Bataan (FAB) that the company aims to start the new power-plant facility early next year in order to deliver a total of 1,800-MW power supply by 2018.

Currently, GNPower is in its ninth month of operating its first facility in Mariveles, which has a capacity of 600 MW. The 600-MW power plant is utilizing half of its total land area in FAB.

The new 1,200-MW power plant will be built in the remaining 60-hectare land of GNPower inside FAB, according to Racelis. He also said the company is allotting $2 billion in the construction of the new power plant. The energy firm is also eyeing to employ 300 personnel once the new facility is in full operation.

Its first power plant already created 200 jobs.Moreover, GNPower will also open its own

educational institution in its area early next year.The energy company’s institution will give two-

year educational programs that are related to the power sector. Racelis noted that this will be crucial to ensure skilled work force in GNPower.

The educational facility will also be able to ac-commodate some 200 students.

Meanwhile, GNPower has assured reliable and cheap power supply inside FAB. The company is also the largest investor in FAB for this year. PNA

p1.50 rollback on gas, diesel pump prices looms–sources

BusinessMirror Saturday, December 13, [email protected] A5

Economy

More is Merrier Commuters risk life and limb to catch and board a jeepney ride in Tuguegarao City, Cagayan. The Land Transportation and Franchising regulatory Board has approved on Thursday a P1 rollback on minimum jeepney fare—from P8.50 to P7.50—amid fuel-price rollbacks. Kevin dela Cruz

GNPower to build 1,200-MW power plant in early 2015

THE Home Mutual Development Fund, or the Pag-IBIG Fund, has invited all land and housing developers to secure

accreditation with the agency so its members will have easy processing when they avail themselves of housing loans.

Fermin Sta. Teresa Jr., Pag-IBIG vice presi-dent for home lending operations, said some land and housing developers are offering housing units to Pag-IBIG members, even if they are not accredited with the agency.

Sta. Teresa said developers are required by law to submit a subdivision plan and a development permit, so that if they are accredited, housing loan borrowers can be sure that their projects are guaranteed because Pag-IBIG will inspect these.

He said they want to protect the interest

of Pag-Ibig members due to reports of sub-standard housing projects by unscrupulous land and housing developers.

“We have to make sure that the houses bought by our members through our housing- loan facility are strong and even disaster-resilient,” Sta. Teresa said.

Sta. Teresa said Pag-IBIG can also help accredited developers address their con-cerns with other government agencies, such as the Housing and land Use Regu-latory Board, land Registration Author-ity, Register of Deeds, Bureau of Internal Revenue and the National Environment and Natural Resources.

“Pag-IBIG has a joint venture with lRA for Pag-IBIG to access lRA data file. We have also a forthcoming agreement with BIR that Pag-

Ibig may collect taxes from members in order to fast-track transactions,” Sta. Teresa said.

He said Pag-IBIG has reduced interest on housing loans from as high as 12 percent to 6.9 percent at present.

The housing agency also increased loan facility for the purchase of condominium units from P3 million to P6 million.

Pag-IBIG, Sta. Teresa said, is also of-fering socialized housing loans to low-income families, like vendors, drivers and housemaids from P400,000 to P450,000 at 4.5-percent interest.

“We offer this socialized housing loan to families with a monthly income of P14,000 and below. We also grant loans of P20,000, P50,000 or P100,000 for home improve-ment,” Sta. Teresa said. PNA

pag-ibig urges land, housing developers to secure accreditation

Editor: Alvin I. DacanaySaturday, December 13, 2014

OpinionBusinessMirrorA6

Why emergency powers for energy?

editorial

THE House of Representatives has passed House Joint Resolution (HJR) 21, which authorizes “the President of the Philippines to provide for the establishment of additional generating capacity

to effectively address the projected electricity shortage in the Luzon grid on March 1, 2015 to July 31, 2015.”

Some senators are expressing concern about the need to grant so-called emergency powers to President Aquino, and we share that concern.

The President requested the resolution, and the House went along with it. But a closer examination of the situation and the resolution it self raise some serious questions as to the need for those special powers.

Is there really going to be a power shortage next summer? While the media have helped push the idea that there may be brownouts, the situation seems to be less serious than what we are being led to believe.

Sen. Francis “Chiz” Escudero said on Thursday he was skeptical of the need to give these powers to the President, after Department of Energy officials had admitted to lawmakers that they were actually predicting a shortage in power reserves, instead of an actual shortage in power supply. While an adequate amount of power reserves is vital in the event of an unexpected breakdown at a power plant, it appears that we are not facing a power shortage.

Even HJR 21 cites “dispatchable reserves” and “required contingency re-serves,” and not a definite lack of power. The legal justification of this resolu-tion rests on Republic Act 9136, or the Electric Power Reform Act, which says the legislature can give special powers if the President determines that there is an “imminent shortage” of the supply of electricity. That particular phrase is in dispute.

But what’s more of a concern is that the HJR, in effect, allows the President, for the March-to-July 2015 period, “to suspend the operability of pertinent laws, rules and regulations, including, but not limited to, mitigating measures adopted for the Wholesale Electricity Spot Market law, the Biofuels Act, the Clean Air Act, the Philippine Grid Code, the Philippine Distribution Code” and other “environmental and labor laws that may affect the operation and transmission of the contracted generation capacities.” Also, “all entities with self-generating facilities shall participate in the Interruptible Load Program.”

In other words, most of the energy laws passed by Congress have failed to provide enough power and must, therefore, be suspended. The private sector is being forced by the government to make up the shortfall of the govern-ment’s failings.

This whole power-shortage issue and the remedy offered by HJR 21 are suspect and need to be examined and clarified further before they progress as policy. Something is not right.

TAKE a look at these recent headlines: “ECB paralyzed by split as irreversible deflation trap draw”; “Central banks battling deflation at any cost”; “Global deflationary

pressures are mounting.”

Deflation: What is it good for?

What is this “deflation” that prompted all these very worrisome headlines—and the stories behind them—to appear? Deflation is the opposite of inflation. It is defined as the reduction of the general level of prices in an economy.

If deflation means that prices are going lower, wouldn’t you think that that is something we, as consumers, would want to see happen?

Prices are usually determined by supply and demand. If everyone wants to buy pork, and the supply of pork is constant, then demand would push prices higher.

But, apparently, the central banks and governments do not want to see prices fall and, in fact, want them to go higher. What could be the reason for that?

One hundred years ago, when the United States Federal Reserve (the Fed) system was created, this is what happened: The government and the Fed made this deal with the

people: Salaries and income were promised to rise about 5 percent a year. No citizen in his or her right mind would turn down that deal. The catch was that prices would al-ways rise by 5 percent, too. But that seems fair enough, where there is no loss and no particular gain. Why not go with this?

And so that is what has been hap-pening for the last 100 years. So why is the world—the Western econo-mies, in particular—in so much pain and trouble?

In truth, the wage gains over the last 100 years have not kept up with the price increases. But the bankers and the government have offset this inequity with all the goodies that were promised at the begin-ning and, in fact, have increased the global standard of living. We have, for example, electricity, cars, telephones and computers, which would not have been available as quickly as possible without the

system of continuously rising prices and more debt.

Inflation has served the world well, in that more money has been made available to finance all the technological advances that make the world modern. But the cost has rested on the shoulders of the same people who benefited from those technological advances, for the inflationary policies created 100 years ago have finally caught up with the global financial system.

Remember when pork was priced at P40 per kilo, and the minimum wage was less than P100 a day? Both pork and the minimum wage have increased about 400 percent since then. So it is a zero-sum game, where there are no real winners and no real losers.

Actually, in every game, there is always a winner, especially when the bankers and the governments are involved.

Had you borrowed P1 million when pork was P40 a kilo, you could now pay back that loan for only P250,000 in today’s money. That is why loans always charge enough interest to cover the de-creasing purchasing power caused by price inflation.

The borrower of that P1 million had gained if the interest rate was less than the increase of inflation. Governments and banks usually borrow at an interest rate lower than inflation, because there is the lower risk of default on the loan.

The loser, though, is the consumer, the average person who has seen prices of ordinary goods go up faster than wages.

“Just as a bad cold leads to pneu-monia, so overindebtedness leads to deflation,” American economist Irving Fisher wrote in 1933. And note this well: Economists gener-ally believe that deflation is a prob-lem in a modern economy, because it increases the “real value” of debt. So the “real problem” of defla-tion is for the big borrower, not to you and me.

The economists will completely disagree and say deflation is a very bad situation. Government and central-bank inflation, on the other hand, is good. Looking at historical records of the United Kingdom 200 years ago, there was no inflation and they never invented the iPhone.

Modern inflation is a creation of modern central banks and govern-ments. Like Frankenstein’s monster, it may come back to kill them.

n n n

ON a personal note, a very Happy Birthday to my best friend, Adaline, who is also my wife and the mother of my sons.

Send me an e-mail at [email protected]. Visit my website at www.mangunonmarkets.com. Follow me on Twitter at @mangunonmarkets. PSE stock-market information and techni-cal analysis tools provided by the COL Financial Group Inc.

OUTSIDE THE BOXJohn Mangun

COULD the innovation that has helped drive human prosperity for centuries finally be petering out? Some worry that the easy discoveries in science and technology have been made,

and it will only get harder from here. Is this believable?

Is innovation over?

The idea seems counterintuitive, given the frantic pace of innovation in Silicon Valley or the steady flow of discoveries in science. Researchers in California, for example, recently discovered a solid material that, even when sitting in direct sunlight, natu-rally cools itself to about 9 degrees Fahrenheit below the ambient tem-perature. It might point the way to a new wave of technology for cooling.

That said, the nature of innova-tion does appear to be changing. An analysis of more than 200 years of United States patent data, for exam-ple, suggests that, although it’s not necessarily slowing down, it has be-come less fundamental and radical.

Looking at codes that represent the array of technologies used in each

new patent, researchers found a fas-cinating historical pattern. For much of the 19th century, the number of distinct technology codes increased exponentially. Inventors were mak-ing completely fundamental dis-coveries, learning basic chemistry, electricity and thermodynamics. They discovered the conservation of energy, learned to make batter-ies and found out that plants were made of cells.

After 1870, the focus of inno-vation shifted toward finding new ways to combine previous discover-ies. The incandescent light bulb, for example, required technologies for generating electricity, as well as for making very thin wires and delicate glass bulbs containing inert gases.

Growth in the number of technology codes slowed, while the flow of new inventions continued apace.

Since 1970, the prevalence of what the researchers called “broad” innovations—those combining radically different technologies—has declined. Such inventions comprised about 50 percent of all new patents as of 2010, down from about 70 percent in the decades following World War II. So there’s a legitimate sense in which the in-novations we see pouring out of Silicon Valley aren’t as creative as those of, say, the 1950s.

All of this seems to fit, at least crudely, with an idea—suggested by economist Robert Gordon, among others—that the information-tech-nology (IT) revolution hasn’t had the same punch as previous episodes as-sociated with plumbing, railroads, electricity or petroleum chemistry. We have harvested the low-hanging fruit, the story goes, and cannot even match our earlier creativity in invent-ing new dishes.

Our understanding of the pace of innovation, however, is limited by what we know how to mea-sure—and, in any case, says noth-ing about what might happen in the future. What if innovation is

actually headed in a completely new direction? Most of our technology, from petroleum to superconductors to synthetic liver tissue made with 3D printers, has come from influ-encing and controlling how atoms, molecules or cells interact. An en-tire realm of possibilities may lie elsewhere, especially in the social world, in learning to manage and expand human interactions.

The social sphere could be where IT, moving on from the likes of Google and Facebook, may ulti-mately have its greatest impact. It’s hard to imagine, for example, that we’ve done anything more than scratch the surface of possible kinds of business organization. Or in discovering how technology can aid our collective creativity, help us learn or enhance our play. Are there technologically enhanced forms of democracy—or other kinds of government we’ve never dreamed of—that would be less prone to the distortions of powerful special interests?

In such matters, we’re as clue-less about what might be possible as physical scientists were about elec-tricity and chemistry in 1700. This would suggest that there’s plenty of profound innovation yet to be done.

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n DXQR - 93dot5 HOME RADIO CAGAYAN DE OROSTATION MANAGER: JENNIFER B. YTINGE-MAIL ADDRESS: [email protected]: Archbishop Hayes corner Velez Street, Cagayan de Oro CityCONTACT NOs.: (088) 227-2104/ 857-9350/ 0922-811-3997

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BLOOMBERG VIEWMark Buchanan

Saturday, December 13, 2014

[email protected]

Evangelii Gaudium

42nd part

II. The inclusion of the poor in society

OUR faith in Christ, who became poor, and who was always close to the poor and the outcast, is the basis of our concern for the integral development of society’s most

neglected members.

In union with God, we hear a pleaEACH individual Christian and ev-ery community is called to be an in-strument of God for the liberation and promotion of the poor, and for enabling them to be fully a part of society. This demands that we be docile and attentive to the cry of the poor and to come to their aid. A mere glance at the Scriptures is enough to make us see how our gracious Father wants to hear the cry of the poor: “I have observed the misery of my people who are in Egypt; I have heard their cry on account of their taskmasters. Indeed, I know their sufferings, and I have come down to deliver them…so I will send you.…” (Exodus 3:7–8, 10).

We also see how concerned He is for their needs: “When the Israelites cried out to the Lord, the Lord raised up for them a deliverer” (Judges 3:15). If we, who are God’s means of hearing the poor, turn deaf ears to this plea, we oppose the Father’s will and His plan; that poor person “might cry to the Lord against you, and you would in-cur guilt” (Deuteronomy 15:9). A lack of solidarity toward his or her needs will directly affect our relationship with God: “For if in bitterness of soul he calls down a curse upon you, his Cre-ator will hear his prayer” (Sirach 4:6).

The old question always returns: “How does God’s love abide in any-one who has the world’s goods, and sees a brother or sister in need and, yet, refuses help?” (1 John 3:17). Let us recall also how bluntly the apostle James speaks of the cry of the op-pressed: “The wages of the laborers who mowed your fields, which you kept back by fraud, cry out, and the cries of the harvesters have reached the ears of the Lord of hosts” (5:4).

The Church has realized that the need to heed this plea is itself born of the liberating action of grace within each of us, and, thus, it is not a ques-tion of a mission reserved only to a few: The Church, guided by the Gos-pel of mercy and by love for mankind, hears the cry for justice and intends to respond to it with all her might. In this context we can understand Jesus’ command to His disciples: “You yourselves give them some-thing to eat!” (Mark 6:37): it means working to eliminate the structural causes of poverty and to promote the integral development of the poor, as well as small daily acts of solidarity in meeting the real needs, which we encounter.

The word “solidarity” is a little worn and, at times, poorly under-stood, but it refers to something more

than a few sporadic acts of generos-ity. It presumes the creation of a new mind-set, which thinks in terms of community and the priority of the life of all over the appropriation of goods by a few.

Solidarity is a spontaneous reac-tion by those who recognize that the social function of property and the universal destination of goods are realities that come before private property. The private ownership of goods is justified by the need to protect and increase them, so that they can better serve the common good; for this reason, solidarity must be lived as the decision to restore to the poor what belongs to them. These convictions and habits of solidarity, when they are put into practice, open the way to other structural transformations and make them possible. Changing structures without generating new convictions and attitudes will only ensure that those same structures will become, sooner or later, cor-rupt, oppressive and ineffectual.

Sometimes it is a matter of hear-ing the cry of entire peoples, the poorest peoples of the earth, since peace is founded not only on respect for human rights, but also on respect for the rights of peoples. Sadly, even human rights can be used as a jus-tification for an inordinate defense of individual rights, or the rights of the richer peoples. With due respect for the autonomy and culture of every nation, we must never forget that the planet belongs to all man-kind and is meant for all mankind; the mere fact that some people are born in places with fewer resources or less development does not justify the fact that they are living with less dignity. It must be reiterated that the more fortunate should re-nounce some of their rights so as to place their goods more generously at the service of others. To speak properly of our own rights, we need

to broaden our perspective and to hear the plea of other peoples and other regions than those of our own country. We need to grow in a soli-darity that “would allow all peoples to become the artisans of their des-tiny, since every person is called to self-fulfillment.

In all places and circumstances, Christians, with the help of their pas-tors, are called to hear the cry of the poor. This has been eloquently stated by the bishops of Brazil: “We wish to take up daily the joys and hopes, the difficulties and sorrows of the Brazil-ian people, especially of those living in the barrios and the countryside—landless, homeless, lacking food and health care—to the detriment of their rights. Seeing their poverty, hearing their cries and knowing their sufferings, we are scandalized because we know that there is enough food for everyone and that hunger is the result of a poor distribution of goods and income. The problem is made worse by the generalized practice of wastefulness.”

Yet, we desire even more than this; our dream soars higher. We are not simply talking about ensuring nourishment or a dignified sustenance for all people, but also their general temporal welfare and prosperity. This means education, access to health care and, above all, employment, for it is through free, creative, participatory and mutually supportive labor that human beings express and enhance the dignity of their lives. A just wage enables them to have adequate access to all the other goods that are destined for our common use.

To be continued

For comments, send an e-mail to [email protected]. For do-nations to Caritas Manila, call (632) 563-9311. For inquiries, call (632) 563- 9308 or 563-9298, or fax 563-9306.

LOOKING at the balance of power in the West Philippine Sea (South China Sea) between China and the United States, many security experts favored the latter, with its ever-present and

powerful Seventh Fleet carrier battle group controlling the sea- lanes all the way down to the Pacific Ocean.

GROW ING v iolence and destruction have marked Libya’s collapse as a nation

since the United States intervened alongside the resistance to the rule of Muammar Qaddafi in 2011.

No one would dispute the fact that Qaddafi was a cruel tyrant while he ran Libya from 1969, when his group of young army officers overthrew

King Idris, until his death at the hands of rebels three years ago. He was opposed by a disparate collec-tion of tribal and local militias that were backed militarily by the US, the United Kingdom, France, Italy and neighboring countries.

What has happened since is caus-ing Libya to become a poster child for the virtues of dictatorial rule in

maintaining order. Other candidates for that dubious honor include Egypt, Iraq and Syria, as well as some Afri-can countries, such as Burkina Faso and Mali.

Libyans have destroyed the last major airport in the capital, Tripoli. Oil production—the back-bone of the economy and the desert country’s only asset—has become

chaotic, in terms of production and marketing.

There are several governments, but no central government. Pieces of the country, even different parts of Tripoli and the second-largest city, Benghazi, are controlled by local mi-litias, and there is no national force capable of defeating them.

Now, an American general is

claiming that forces of the Islamic State, which has replaced al-Qaeda as America’s favorite enemy, are training in the east of Libya. This could be true. There are all manner of military forces operating in law-less Libya now.

On the other hand, the general may just be preparing Congress and the American people for another

expensive US military intervention.That would be another mistake,

comparable to the first US foray into Libya, to the third US intervention in Iraq now under way and to Presi-dent Barack Obama’s extension of America’s military presence in Af-ghanistan by a year, without approval from Congress, or a way to pay for the operations. Pittsburgh Post-Gazette/TNS

The changing balance of power in the West Philippine Sea

The post-Qaddafi era is fraught with chaos

However, as an observer of national and international security, I differ with them, and here’s why:

Over the past few years, China real-ized that American firepower moved fast on its littoral waters, posing as a threat to its intention of enforcing ter-ritorial claims against Japan, Vietnam and the Philippines.

In response, China developed the world’s first land-based missile system, called Dong Feng 21D (DF-21D), which is capable of sinking aircraft carriers from a distance of between 1,500 and 3,000 kilometers, only 143 km less than the range between China and the Philippines.

For US fighters in the Seventh Fleet, this is quite a long way out to try to take out the missiles before they are fired, and China has mobile launchers and an elaborate series of hardened underground tunnels. It has also ad-vanced its hypersonic glide-vehicle technology capable of allowing mis-siles to change course if ships attempt to dodge their approach.

The DF-21Ds, which were devel-oped secretly in the 1990s, feature multiple warheads that can carry con-ventional or nuclear weapons. They are capable of hitting their long-distance targets in about 12 minutes. The US may already have the technology to deflect or evade them, or destroy them in some way. But the fact remains that these new weapons are leaving Washington and the Pentagon sleep-less at night.

These clusters of $10-million weap-ons that China developed over the years, as mentioned in various defense and security documents, are capable of taking out aircraft carriers worth between $3 billion and $4 billion— arguably a real bargain for the Chinese.

Not only that, the very existence of these missiles is shifting the balance of power in waters that US President Barack Obama, in his announced pivot to Asia, has recognized will be the main theater for naval warfare in the coming century. That is, indeed, bothersome for security experts.

What is even more bothersome is the implication on the balance of nuclear deterrence that the US and Russia have so carefully crafted and put in place.

In 1987 then-US President Ron-ald Reagan and then-Soviet Gen-eral Secretary Mikhail Gorbachev had signed the Intermediate-Range Nuclear Forces Treaty (INFT). Under this accord, the development and test-ing of DF-21Ds would not have been allowed. But China, then a budding military force, was not a signatory to that treaty. Neither were India and Pakistan, which are now two nuclear-powered countries.

Even before the end of the Cold War, the US and Russia realized that ballistic and cruise missiles (either nuclear or conventional), with ranges of between 500 and 5,500 km, were a major threat to either country’s capac-ity to defend itself, and incompatible with any workable system of interna-

tional arms control. So they agreed to cease developing them, and destroyed those that were already built.

Unfettered by any international agreement, China, with an expand-ing budget of over $200 billion a year, decided that it would design potent missiles capable of flushing US war-ships out of its littoral waters.

No doubt, the DF-21Ds fit in with China’s overall development of a new generation of missiles, both subma-rine-launched and intercontinental, that are designed to bolster its capabil-ity to overwhelm US missile-defense systems. The DF-21Ds, if they work as advertised, are one area where the Chi-nese may have actually pulled ahead in modern weapons technology among the superpowers.

The Chinese, though, might choose to arm the DF-21Ds with conventional, rather than nuclear, weapons in the interest of saving the world from a nuclear disaster. But, suppose an at-tack is launched on a US carrier battle group, would an American command-er, with 12 minutes to respond, know that? And even if the rockets carried conventional weapons, how would the US respond?

What steps can be taken to prevent such a crisis?

I fully agree with the solution of-fered by Canadian Sen. Colin Kenny, former chairman of the Senate Com-mittee on National Security and De-fense, that a negotiated treaty be-tween the Americans and the Chinese, similar to the 1987 INFT, would help defuse things.

The new Chinese weapon—a ver-sion of which was displayed last year in a Chinese military parade—is rev-olutionizing China’s role in the West Philippine Sea and the Pacific balance of power, seriously weakening the US’s ability to intervene in any potential conflict over Taiwan or North Korea. It could also deny US ships safe access to international waters near China’s 18,000-km coastline.

While a nuclear bomb could theo-retically sink a carrier, assuming its user was willing to raise the stakes to atomic levels, the conventionally armed DF-21Ds’ uniqueness lies in their ability to hit a powerfully defended moving target with pin- point precision.

“When considering the military-modernization programs of countries like China, we should be concerned less with their potential ability to chal-lenge the US symmetrically—fighter to fighter or ship to ship—and more with their ability to disrupt our free-dom of movement and narrow our strategic options,” former US Defense Secretary Robert Gates said.

“China’s investments in cyber and antisatellite warfare, anti-air and antiship weaponry, along with ballis-tic missiles, could threaten America’s primary way to project power through its forward air bases-and-carrier strike groups,” he warned.

E-mail: [email protected].

SERVANT LEADERRev. Fr. Antonio Cecilio T. Pascual

DATAbASECecilio T. Arillo

Model contract to help protect developing countries from ‘land grabs’By Carin Smaller

Inter Press Service

GENEVA—When the South Korean company Daewoo attempted to acquire half of the arable land of Madagascar for free, it unleashed a tsunami of investor interest in

agricultural land, popularized as the “land grab”.

In the last 10 years there have been more than 1,000 large-scale foreign investments in agricultural land, covering almost 38 million hectares of land that are equivalent to eight times the size of Britain. Investor interest in farmland was triggered, in 2008, by a confluence of the biofuels boom, global food crisis, a sharp spike in oil prices and the financial crisis.

Many of these farmland invest-ments have created untold problems, particularly related to land rights, social unrest and, in some cases, political instability. Many projects have failed or investors have simply given up, either for lack of finance, inexperience, difficult environmen-tal conditions or unrealistic assump-tions about the crops and locations they chose.

And, yet, many developing coun-tries desperately need investment in agriculture. There are over 800 mil-lion people in the world who do not have enough food to eat. Seventy-five percent of those people live in rural areas and depend on agriculture for their livelihoods. Without increased investment in agriculture, they will not be able to improve food security

or reduce poverty.Improving the legal and policy

environment in developing coun-tries would do much to improve the situation. The most important step to ensuring positive impacts of foreign investment is the ongoing development of domestic laws and regulations. However, many states do not have all the necessary domes-tic laws in place and end up negotiat-ing contracts.

Given this reality, the Inter-national Institute for Sustainable Development has created a practical guide to help governments in devel-oping countries negotiate contracts with investors to reduce the harmful effects and maximize the benefits of farmland investments.

It is the first attempt to create a model contract for developing coun-tries to attract investment for ag-ricultural production, while, at the same time, promoting the needs of the poor and protecting the environ-ment. It is based on a three-year in-vestigation of 80 farmland contracts and is unique in that it was drafted by a team of lawyers, social scientists and environmentalists.

This model contract does not cre-

ate a blueprint. Each contract will necessarily be different, depending on the size of the project, the domes-tic legal systems, and the country’s needs and realities. Deciding what to include in each contract is the job of the parties both before and during the negotiations.

Nonetheless, we believe there are three factors that are critical for success.

First is the process of prepar-ing for negotiations. This involves identifying suitable and available land (both from an environmental and a land-rights perspective). It requires meaningful consultations with and consent by communities living on and around the proposed project site. It is important for investors to assess the feasibility of the project to ensure it is commer-cially viable.

This assessment should be pre-sented to the governments with a business plan. In this preparatory phase, investors also need to exam-ine the potential social and envi-ronmental impacts, and prepare a plan for how to manage and mitigate those impacts.

Second is turning investor prom-ises into binding commitments. A major complaint from governments and communities is that investors make big promises to create jobs, build factories and bring new tech-nology; and that these promises rarely materialize.

Promises can be incorporated into the contract to make them

legally binding. But they must re-main realistic and achievable to avoid setting up the project for failure from the outset.

The third step is turning the contract into reality after it has been signed. A contract is not an end point; it is only the start of a long-term relationship be-tween the investor, the government and communities.

Implementing and enforcing the contract is a much tougher challenge. It requires regular reporting by the investors on how they are implement-ing their promises and managing the social and environmental impacts. It requires monitoring and evaluation by governments.

And, finally, all steps taken around a potential investment should be open and transparent to minimize the risk of corruption and ensure greater acceptance.

Improving the legal and policy frameworks for investment will help governments maximize the benefits and minimize the risks associated with investment in farmland and water. They will support efforts to strengthen food security and achieve sustainable rural development.

Carin Smaller is an advisor on agriculture and investment for the Eco-nomic Law and Policy program of the International Institute for Sustainable Development in Canada. She advises governments and parliamentarians on law and policy issues related to foreign investment in agriculture.

A8

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www.businessmirror.com.ph

See “BOJ,” A2

Saturday, December 13, 2014

Oil clOses belOw $60, first time since July 2009The price of oil fell below $60

for the first time since July 2009 on Thursday and ended

trading in New York at $59.95. Benchmark US crude oi l dropped 99 cents, or 1.6 percent. Oil has fallen steadily for nearly six months, and is down 44 percent since reaching a high for the year of $107.26 in late June. “We don’t see a price bottom,” wrote energy analyst Jim Ritter-busch in a note to investors. he ex-pects oil to fall further, toward $55 a barrel, in the short term. The drop is a result of rising global oil production, especially in the US, at a time when demand has weakened because of slowing economies in Asia and europe. The Organization of the Petro-leum exporting Countries (Opec) said this week that higher produc-tion from non-Opec members and global economic growth will reduce demand for its oil to 28.9 million barrels a day next year. That’s the lowest level in more than a decade, and far less than the 30 million bar-rels per day that the group says it plans to produce next year. The price collapse has pushed down prices for gasoline, diesel and

other fuels, lowering expenses for drivers, shippers and airlines and giving a boost to consumer-driven economies like that of the US. The average price of gasoline in the US fell to $2.61 a gallon on Thursday, according to AAA. That’s 64 cents below last year at this time, saving US drivers $7 billion a month. The energy Department predicted this week that lower gasoline prices next year will save a typical US household $550 over the course of the year. Lower crude prices have sent the share prices of oil companies and drilling services companies spiraling lower, though, and caused many to cut back drilling projects. As a result, the energy Depart-ment this week trimmed its fore-cast for oil-production growth in the US for next year, though it still expects a sizable increase. BP an-nounced a $1- billion restructuring plan this week that analysts said could result in the elimination of thousands of jobs. The lower prices are also pres-suring government budgets in oil-producing US states and cash-hungry oil exporters such as Iraq, Iran, Russia and Venezuela. AP

Businessmen ask MMDA to lift truck ban on Roxas Boulevard

Philippine bonds in biggest weekly gain in 14 months on upgrade

Govt eyes strategic partnership with s. KoreaPhiliPPine 10-year bonds gained

the most in almost 14 months this week on speculation a

Moody’s investors Service upgrade of the nation’s sovereign rating will lower government borrowing costs. Moody’s on Thursday raised the Philippines’s rating to “Baa2” from “Baa3” and assigned a stable outlook, citing debt reduction and improve-ments in fiscal management. The move put the nation on a par with Spain and higher than indonesia. “The Moody’s action was a big fac-tor,” said Dave estacio, vice president and treasury chief dealer at First Metro investments inc. “if it hadn’t happened, yields would have prob-ably risen as we approach the long holiday break.” The yield on peso bonds due no-vember 2024 fell 16 basis points this week, the most since the five-day pe-riod ended October 25 last year, to 4.17 percent in Manila, according to noon fixing prices from Philippine Dealing & exchange Corp. The yield dropped 18 basis points, or 0.18 percentage point on Friday. That move was also the biggest since October 2013. “As we move up on the credit-rating scale, it’s expected the coun-try will be increasingly placed on the radar screen of investors and of course, it’s beneficial to us,” BSP Governor Amando M. Tetangco Jr.

By Lorenz S. Marasigan

LocaL businessmen are urging the Metropolitan Manila Deve-lopment authority (MMDa) to

reopen Roxas Boulevard to trucks to hasten the delivery of goods and ensure the stability of prices.

BUSAN, South Korea—Presi-dent Aquino has tabled his plan to form a “comprehen-

sive strategic partnership” with the Republic of Korea (ROK) that aims to bring significant opportunities for the two countries. Mr. Aquino presented the plan during his bilateral meeting with ROK President Park Geun-hye shortly after his arrival here on Thursday to attend the 25th anniversary of the Association of Southeast Asia Na-tions (Asean)-ROK Commemorative Summit. “President Aquino conveyed the Philippines’s intention to pursue a comprehensive strategic partnership with the Republic of Korea,” said Com-munications Secretary herminio B. Coloma Jr., who joined the President during the bilateral meeting at the Westin Chosun Busan hotel. “he noted that the two countries are ‘sister democracies’ that ‘face the same threats and challenges of an evolving region’, while sharing the ‘values of freedom, respect for human rights and adherence to the rule of law’,” Coloma added. The Palace official said Park re-aff irmed South Korea’s defense cooperation agreement with the Philippines, citing Manila’s acqui-sition of 12 FA-50 fighter jets from the state-owned Korean aerospace firm and Seoul’s donation of other combat equipment. “She recalled that after President Aquino’s state visit last year, the Phil-ippines initiated the acquisition of 12 FA-50 fighter aircraft, transport equipment and raw materials for the government arsenal, and is receiving a donation of a patrol combat corvette, a landing craft utility and 16 rubber boats,” said Coloma. Before heading home, President Aquino is slated to meet with Korea Aerospace Industries President and CeO Sung Yong-ha, and ROK Air Force officials at the Gimhae Air Base for the inspection of the fighter jets, worth P18.9 billion. This deal aims to bolster the Phil-ippine military’s defense capability amid increasing tensions in disputed islands in the West Philippine Sea. Coloma said regional security con-cerns were discussed during the bilater-al meeting as the two leaders reviewed the situation in the Korean peninsula and in the West Philippine Sea. “President Aquino reiterated the Philippines’s support for efforts on the peaceful denuclearization of the Korean peninsula and the early resumption of the six-party talks”, he continued. he noted the two countr ies “shared stake in maintaining unim-peded commerce and freedom of navigation in the region and sought South Korea’s continued support for the pursuit of a peaceful, rules-based resolution of disputes in the West Philippine Sea,” he added. PNA

The MMDA’s implementation of a truck ban on Roxas Boulevard, according to local businessmen, “ef-fectively wiped out” the 30-percent uptick in the movement of goods and the 15-percent improvement in port congestion which was driven by decreased dwelling periods of port-related trucks. The Port Congestion Multi-Sec-toral Working Group (PC-MWG) said in a media briefing that port con-gestion in Manila is still a “serious problem” due to the massive backlog in undelivered cargo and the ongoing truck ban. “The truck ban [on Roxas Bou-levard] threatens to erase the gains we have worked for in the last eight months,” said ernesto M. Ordoñez, who represents the Federation of Philippine industries in PC-MWG.

The MMDA started enforcing a six-month-long total truck ban along Roxas Boulevard on December 3. Ordoñez said more than 30 per-cent of commercial vehicles that use the ports pass through Roxas Bou-levard. he said shutting it down to trucks during the holidays would dramatically lower the efficiency of trade to and from the port. “The solution, the group agrees, is to keep Metro Manila’s highways open to truck traffic,” he said. Ordoñez said roughly 2,000 of the 6,000 trucks that use the ports daily pass through Roxas Boulevard. “These vehicles are now forced to reroute to narrower side streets, which lead to logistical problems,” he said. Apart from lifting the truck ban on the major thoroughfare, local businessmen have also enjoined the

government to implement reforms that will help ease the port-conges-tion problem. Ordoñez said importers are still in a “great deal of pain” largely because of the difficulty in getting a provi-sional import clearance certificate (iCC) from the Bureau of internal Revenue (BiR). While the Bureau of Customs’ sprocess has been streamlined partly because of the private sector’s recom-mendation on specific requirements to be deferred, little improvement has been seen in the BiR’s process. “This is despite the government’s statement that the severely inad-equate 20-person contingent review-ing 15,000 iCC applications would be increased,” Ordoñez said. “in addition, the seven redundant requirements that the private sector and a number of process specialists in the BiR had jointly recommended to be eliminated have not been acted on yet,” he added. “The PC-MWG is asking the BiR to streamline the seven require-ments necessary for the issuance of iCCs. This will result in dramatically speedier flow of trade by allowing importers,” he added. The group said another major stumbling block to the easing of the port congestion is the land Trans-portation Franchising and Regula-

tory Board’s (lTFRB) limit in the issuance of franchise to trucks. The regulatory body restricts the granting of certificates of public con-venience only to trucks 15 years old and below. Fernando Peña, who represents the Management Association of the Philippines in the PC-MWG, said the lTFRB regulation effectively keeps 70 percent of all roadworthy trucks off the road. This, he said, hinders the flow of goods and prevents the Philip-pines from being competitive. Meanwhile, Ordoñez called on shipping lines to take care of their empty containers, although he ac-knowledged the efforts of several shipping lines to provide more con-tainer yard space. he recommended the imple-mentation of a system where the shipping line and not the importer would pay for the time lost when the container yard specified by the shipping line in the interchange receipt is not available. PC-MWG earlier called on the government to ask shipping lines to justify the increase in their rates. Yard utilization at the ports of Manila is currently at 81 percent. Manila international Container Ter-minal’s utilization is at 84 percent, while Manila South harbor recorded a utilization rate of 77 percent.

in recent years would also boost sales. For 2015, iPC has set a sales target of 4,000 units for the Cross-wind, 4,000 units for D-Max and 4,000 units for trucks. Bautista said the company is bull-ish on its truck segment as operators are projected to buy more brand-new trucks to reduce downtime due to maintenance. izumina said iPC is eyeing to double its dealers and distribution channels as the industry gears up to meet consumer demand for vehicles by 2020 pegged at 500,000 units. Around 90 percent of isuzu ve-hicles are locally assembled. Bautista said the company expects this figure to decline to 70 percent as sales of the imported mu-X go up next year.

Isuzu. . . continued from a1

The Bank of Japan (BOJ) re-jects the idea that additional monetary stimulus is needed

to prevent the decline in oil prices in recent months from pulling down in-flation, according to people familiar with the discussions. For now, policy-makers assess that while cheaper energy costs may weigh on consumer prices for a time, they ultimately will boost the economy—spurring inflation, the people said, asking not to be named as the talks are private. less agreement is found on how much capacity the central bank has to expand its buying of government debt, some of the people said.

The slide in oil prices to a five-year low this month magnified the challenges to Governor haruhiko Kuroda and his colleagues, as they try to secure a 2-percent pace for their main inflation gauge next year. Spring wage talks between business and labor leaders will be critical to gauging prospects for consumer prices, the people said. “The BOJ is unlikely to add stimu-lus” in January, said hiroaki Muto, an economist at Sumitomo Mitsui Asset Management Co. “They will argue that oil prices are going to have positive effects on the economy and that their revision to the inflation outlook is minor.”

b.O.J. tO reJect addinG stimulus tO ease cPi blOw frOm Oil

Continued on A2

businessmirror december 13, 2014

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