By Butch Fernandez

The highly anticipated imple-mentation of the measure increasing the current P30,000

cap on tax-exempt bonuses will see delays after Malacañang made it clear that it will not jump the gun

See “Bonus,” A2See “SM Prime,” A2

www.businessmirror.com.ph n Tuesday, November 18, 2014 Vol. 10 No. 40 P25.00 nationwide | 7 sections 32 pages | 7 days a week n Friday, december 5, 2014 Vol. 10 No. 57

A broader look at today’s businessBusinessMirrorthree-time

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

The Philippines will remain the fastest-growing economy in

Southeast Asia until 2016, the Institute of Chartered Accountants in england and Wales’ (ICAeW) fourth-quarter 2014 “economic Insight” report shows. The latest ICAeW report has compared the six largest economies in the Asean that include Indonesia, Malaysia, the Philippines, Singapore, Thailand and Vietnam. The Centre for economic and Business Research (CeBR), the producer of the “economic Insight” and ICAeW’s partner for global economic forecasting, sees gross domestic product (GDP) growth for the Philippines this year at 6.6 percent. This year’s anticipated GDP growth report is higher than the projected growth for Indonesia, seen expanding by only 5.0 percent; Malaysia, 5.2 percent; Singapore, 3.1 percent; Thailand, 1.9 percent; and Vietnam, 5.1 percent. The growth trend for the Philippines was seen to per-sist in 2015, with local output growth projected to average

See “Growth,” A2

‘PHL to sustain above 6% growth’

no shortcutsfor bill hikingtax-exemptbonus cap

i.c.a.e.w. says Phl to remain asean’s best-PerforminG economy uP to 2016

SM Prime, Solar investing $20M in new video-on-demand venture

fed: u.s. economy KePteXPandinG in oct, noVThe US economy kept expanding in October and No-vember, helped by solid gains in consumer spending, manufacturing and overall employment, according to the Federal Reserve’s (the Fed) latest survey of business conditions around the country. The Fed survey found many areas of strength and, for the first time this year, the report did not see a need to qualify its summary of growth by using words like “modest” and “moderate”. The Fed said business executives remain optimistic about the prospects for growth in 2015. The gains in eco-nomic activity were coming, as overall inflation remained subdued, although the report did find upward wage pres-sures for some skilled workers. The report, known as the Beige Book for the color of its cover, will form the basis for discussion at the Fed’s final policy-making meeting of the year on

OFw sUMMIT Hundreds of overseas Filipino workers (OFws) and their family members join sen. Cynthia Villar (center) at the opening of the fourth OFw and Family summit, organized by the social Institute for Poverty alleviation and Governance, at the world Trade Center in Pasay City on Thursday. Joining Villar are former senate President Manny Villar; Joey Concepcion, president of GoNegosyo; Rep. Mark Villar of Las Piñas; and British ambassador to the Philippines asif ahmad, who cited the need for OFws to gain new entrepreneurial skills. See story on B4. Roy DomiNgo

INSIDE

PALACE GEMS COME BY THE

DOZEN »D3Life Friday, December 5, 2014 D1BusinessMirrorEditor: Gerard S. Ramos • lifestylebusinessmirror@gmail.com

S AINT Michael the Archangel, defend us in battle. Be our protection against the wickedness and snares of the devil. May God rebuke him, we

humbly pray, and do thou, oh prince of the heavenly host, by the power of God, cast into hell Satan and all the evil spirits, who prowl about the world seeking the ruin of souls. May each one of us seek the help of our own guardian to protect us all the days of our lives. Amen.

Be our protection

PLANNER PRAYER BOOK,FR. SAL PUTZU, SDB AND LOUIE M. LACSON

Word&Life Publications • teacherlouie1965@yahoo.com

The Theoryof Eddie Redmayne

B B VPittsburgh Post-Gazette

TORONTO—At age 32, Eddie Redmayne is still boyish, with freckles not always visible onscreen, a generous head of hair, a wardrobe

that includes both a black leather jacket and Converse sneakers, and a humility about the praise that welcomes him as he walks into a hotel room one Sunday morning. In The Theory of Everything, he plays Stephen Hawking, who was 21

years old in 1963 when he was diagnosed with motor neuron disease (an umbrella term that includes Lou Gehrig’s disease, or ALS) and given two years to live. The brilliant astrophysicist defied all odds and today, reliant on wheelchairs, speech synthesizers, nurses and aides, is 72.

“As an actor you dream of being able to tell extraordinary stories about extraordinary people, but the stakes felt so high,” Redmayne told a handful of journalists during September’s Toronto International Film Festival where the movie had its world premiere.

Hawking’s family, especially his first wife, Jane, had allowed the filmmakers to tell their story, and Redmayne spent four or five months meeting with other patients and doctors. “People invited me into their homes, people who subsequently died from the disease,” he said, and he wanted to represent their experience truthfully.

“It was one of those jobs I went bullheaded into trying to get, and then once I got it, I had this moment of euphoria, followed by this sledgehammer

C D

COME BY THE DOZEN

BusinessMirrorMotoringE1 Friday, December 5, 2014

Henry Ford AwardsBest Motoring Section2007, 2008, 2009, 20102011 Hall of Fame

Editor: Tet Andolong

The much-anticipated event is set to be held from  February 25 to March 1, 2015,  on a special racetrack in Rizal Park. The event, which will be staged for the second time in the Philippines, promises to be bigger and better. Earlier this year, the country had hosted the event from February 6 to 9, coincid-ing with the 100th anniversary of the Shell companies in the country.

During the launch, Bobby Kanapi, Pilipinas Shell vice presi-dent for communications, led the ceremonial run using the T-400 eco-car, a vehicle designed by the host school’s UST Eco-Tigers1 team. The T-400 runs on gasoline and is UST’s entry in the urban category of the 2014 SEM Asia.

“SEM Asia started about 13 years ago, with the different Shell

companies competing against each other to see which is the most ‘ef-ficient’ vehicle, with efficiency measured in terms of which car can travel farthest using the least amount of fuel,” Kanapi related.

“That started the whole thing, and then we invited universi-ties to design cars and encour-aged their students to build the units—first in Europe, then in America, and eventually in Asia in 2010. We really have to give it to the Philippines, because we now have a lot of universities in this country willing to build their own cars. We are actually getting more participants this year compared to last year.”

The global event has been bring-ing together aspiring, young en-gineers around the world, who are

encouraged to develop fuel-effi-cient vehicles of the future. They also learn to utilize energy mix that includes biofuels, such as ethanol, compressed natural gas and gas-to-liquids (GTLs), apart from con-ventional gasoline and diesel. SEM classifies original car inventions into prototype and urban-concept vehicles, which compete against each other in the areas of speed, mileage and other technical and de-sign aspects.

In fact, the idea of the SEM orig-inated in 1939 at a Shell research laboratory in the US. It initially served as a friendly wager among scientists to find out who could get the most miles per gallon of fuel from their vehicle. It was in 1985 when the SEM was launched in France.

SEM Asia was launched in 2010 in Malaysia, where it was held until 2013. The Philippines is set to host the event until 2016.

In 2015 a record-breaking total of 178 student teams from 20 coun-tries across the entire Asian region are expected to participate. Contin-gents from Australia, Bangladesh, Oman, Saudi Arabia and South Af-rica will also be entered for the first time in Asia. In the Philippines a record number of 34 entries from 25 engineering colleges and univer-sities will be fielded, compared to 15 teams from nine schools onsite in the previous stint.

UST, one of the participating schools from the Philippines, which

had been participating in the SEM Asia since its inception in 2010, is setting its sight on achieving a modest goal for its T-400.

Paolo Jose, team manager of the UST Eco-Tigers1, said in an inter-view: “What we would like to do now for the upcoming event is to improve on our performance and, hopefully, win at least a special award.”

Their T-400 established a fuel ef-ficiency of 172.3 kilometers per liter

in its last outing.   The entry from UST was actually considered the best-performing vehicle among Philippine schools that competed at the time. They were also named fifth-best in Asia.

Sixteen other schools have been added to the list this year. These are Ateneo de Davao Uni-versity, Cebu Institute of Technol-ogy, De La Salle Dasmariñas, Feati University, Holy Angels University,

Malayan Colleges Laguna, Manuel L. Quezon University, Mindanao State University-Iligan Institute of Technology, National Univer-sity, New Era University, Paman-tasan ng Lungsod ng Maynila, Southern Luzon State Univer-sity, Technological University of the Philippines-Manila, Uni-versity of the East, University of the Philippines Diliman and University of Mindanao.

The future of Shell mobility and fuel efficiency begins anewStory & photo by Ronald Rey M. de los Reyes

THE young have already set their eyes on only one thing: the future. And here in the country,

they have something to look forward to in 2015 as the Shell Eco-Marathon (SEM) was recently launched at the Plaza Mayor of the University of Santo Tomas (UST) in Manila.

THE University of Santo Tomas Eco-Tigers1 Team and their engineering classmates.

SportsBusinessMirror

C1 | Friday, deCember 5, 2014mirror_sports@yahoo.com.ph

sports@businessmirror.com.phEditor: Jun LomibaoWASHINGTON—Lakers Coach Byron Scott

wants Kobe Bryant to keep playing—and he’s willing to do whatever it takes

to keep the star on the court. Throughout a miserable 5-13 start to the season, Bryant has been a bright spot. He’s leading the National Basketball Association (NBA) in scoring with a 25.8 average in nearly 36 minutes per game. “The one thing I’ve got to do is look at his minutes, and make sure I don’t go overboard,” Scott said before Wednesday’s game against the Washington Wizards. The 16-time All-Star played 33 minutes in Tuesday night’s win at Detroit, and said afterward he was tired. Scott says Bryant can set his own schedule—for practice.

“I don’t need him in practice at all, to be honest with you,” Scott said. “All he needs to know is what we’re doing, coverage-wise.” The 36-year-old Bryant has one more year after this one on his contract. Scott is hoping he’ll play longer than that. “We’ll talk about that,” Scott said. “He’s got a lot left in that tank. I think if we put something together that excites him, we have a real good chance of saying, ‘play another year.’” Scott has known Bryant since 1996 when they were teammates in the coach’s last year as a player—and Bryant’s first. “He’s still hungry. He still loves the game. He still loves the competition. He still loves going against these younger guys now because he was once that younger guy,” Scott said. AP

PERSUADING KOBE

LAKERS Coach Byron Scott says Kobe Bryant still has a lot left in his tank. AP

The M-V-P chant was for

John Wall, not Kobe Bryant, who started

hot but finished not in a 111-95

Washington Wizards victory on Wednesday.

W INDERMERE, Florida—Tiger Woods didn’t even have a club in his hand when he passed an important test on Wednesday at Isleworth.

After hitting a fairway metal off the 10th tee, Woods gingerly stepped through a flower bed and then hopped down a four-foot wall and trotted to the clubhouse to use the bathroom. It was that kind of leap—from a bunker at Firestone—that jarred back muscles and ultimately forced yet another injury-induced layoff. His golf on Wednesday wasn’t too bad, either. Woods swung freely and easily during the pro-am at the Hero

World Challenge, his first time walking 18 holes since he missed the cut August 9 at the Professional Golfers’

Association (PGA) Championship. “It felt good to be out there,” Woods said.

“I took that much time off right after the PGA and built up my body and made a few adjustments on my swing and hit some good shots today.” The real test is on Thursday in the first

round of an unofficial event with 18 elite players from the top 50 in the

world, and one big buzz because of the tournament host.

Woods has slipped to No. 24 in the world. He never lost his ranking as golf’sbiggest draw. “I think if he starts swinging it better and starts feeling good about what he’s doing again, it won’t take long for him to be at the top of the game again,” Steve Stricker said. This is the fifth time in five years Woods has returned from an injury, and the second time this year. He came back too early from back surgery in June and missed two cuts in the three events he played. Health no longer seems to be the issue. The biggest question is the swing. Woods parted with swing Coach Sean Foley and has brought on Chris Como, who walked the pro-am with him and occasionally chatted with him in the fairway. Woods said he looked at tape dating all the way back to his amateur days and described his goal for a new swing as “new, but old.” Stricker saw him briefly on the practice range earlier in the week and felt as though he was looking back in time. “Looks a lot similar to early 2000s to me, from the side when I was watching,” Stricker said. That was when many believe Woods was at his best. He won seven majors in a four-year stretch from 1999 to 2002, and no one was close to him in the game. Woods turns 39 at the end of

the month, and he joked last Tuesday that “Father Time remains undefeated.” He physically is not the same player he was at age 24. What Stricker noticed was a swing that appeared more natural and less technical. “Looked like the swing was going through a lot freer, like it was on a better path,” Stricker said. How long it takes for it to translate to low scores or even trophies remains to be seen. It took Woods at least a year before he was up to speed on wholesale changes under Butch Harmon, Hank Haney and Foley. “This is what, his fourth teacher?” Stricker said. “I’m sure he’s still going to have some issues going forward.” The tournament has moved from Sherwood Country Club in California to the course that Woods called home for 16 years. Isleworth is considered a tough golfcourse, though there are more forward tees in play to help with gallery movement. Woods is used to playing it all the way back and smashing driver. He wound up in a few bunkers Wednesday that typically are not in play for him. The field is missing the new No. 1—Rory McIlroy—along with Adam Scott, Phil Mickelson and Sergio Garcia, who rarely play. AP

TigER fEELS good To BE ouT ThERE

LAKERSHIT WALL

» KoBE BRYANT scores 29 points but doesn’t make a shot in the

second half and the Lakers fall to 4-1 against the East. AP

TigER WoodSbrings a buzzback to golf.

By Mike BresnahanLos Angeles Times

 

WASHINGTON—So much for all the jokes about the Los Angeles Lakers wishing they played in the Eastern Conference. They returned to the regularly scheduled narrative of their season,

another loss, after a two-game spree against the East. The M-V-P chant was for John Wall, not Kobe Bryant, who started hot but finished not in a 111-95 Washington Wizards victory on Wednesday. Jeremy Lin was benched in the fourth quarter after missing all 10 of his shots, Bryant scored 29 points but didn’t make a shot in the second half and the Lakers fell to 4-1 against the East. Of greater importance, they’re 5-14 overall and a medium-sized Metro ride from the lottery, to steal a local term here. If nothing else, it was a good time to ask Bryant about his future plans. Will he keep playing after his current contract expires in 2016? “Maybe. Maybe not. I don’t mean to try to be coy about it. I don’t know what to tell you. Right now, I’d say no,” said Bryant, who pinned it on whether he could keep handling the daily effort to play at his level, let alone his grueling off-season workouts. “The amount of commitment that it takes, it’s nuts,” Bryant said, not mentioning the continual ice baths, detailed stretching routines and eternal fountain of hydrating fluids he consumes religiously. Plus the simple concept of elevating his legs for long periods every day. Another unspoken factor: There’s no telling what the Lakers look like in July 2016. Will they have the pieces to entice Bryant to stay? And how much of a pay cut would he take after the $25 million he’d make next season? “If I want to play, I’ll play. I tend to make my own decisions,” he said. “If I don’t want to play, I won’t play.” Lakers Coach Byron Scott wouldn’t want to hear the latter. “I think if we put something together that excites him, I think we have a real good chance of saying, ‘Play another year. Give it another shot,’ “ Scott said. “So that’s what we plan to do.” Bryant couldn’t be blamed if he was being coy. There are so many unknowns about the Lakers. Nobody can predict if they’ll finish low enough after the lottery to keep the pick they owe Phoenix for 65 games’

worth of Steve Nash. No one knows if they can get Kevin Love or someone like him next summer. Or Kevin Durant the following summer. Meanwhile, there’s this team. Ronnie Price was the Lakers’ point guard in the fourth quarter, not the scoreless Lin. As Lin ran to the locker room briefly during that span, a fan wearing a Bryant jersey yelled, “Stay back there!” Nick Young scored 21 points. Carlos Boozer had a quiet 10 points, Jordan Hill a quieter eight points and Wesley Johnson won the quietest award among them with six points. “We just need more guys to join the party,” Scott said. “We don’t have the luxury of two or three guys not having good games on a night like this playing against a team like this.” Bryant missed all seven of his second-half shots after making eight of 15 in the first half, when the Lakers built a 10-point lead. Worth mentioning: The Lakers were playing on back-to-back nights as the Wizards finished the game with a 14-2 run punctuated by three dunks, a lay-up and a four-point play. Bradley Beal had 27 points and Wall had 17 points and 15 assists for the Wizards (12-5). With so much talk about the future, it was youth and vigor the Lakers wished they owned. Elsewhere in the league on Wednesday, it was Chicago 102, Charlotte 95; Atlanta 112, Miami 102; Boston 109, Detroit 102, overtime; Brooklyn 95, San Antonio 93, overtime; Houston 105, Memphis 96; Dallas 107, Milwaukee 105; Philadelphia 85, Minnesota 77; Toronto 123, Utah 104; and LA Clippers 114, Orlando 86.

LIFe d1

MOTORING e1

sPORTs C1

THE THEORYOF EDDIEREDMAYNE

THE FUTUREOF SHELLMOBILITYAND FUELEFFICIENCYBEGINS ANEW

LAkERSHIT WALL

Peso eXchanGe rates n us 44.7410 n jaPan 0.3735 n uK 70.1897 n hK 5.7695 n china 7.2750 n sinGaPore 34.1118 n australia 37.7020 n eu 55.0851 n saudi arabia 11.9230 Source: BSP (4 December 2014)

Continued on A8

By VG Cabuag

SM Prime holdings Inc. will form a vid-eo-on-demand streaming-service ven-ture with a unit of Solar entertainment

Corp., signaling the Sy family’s first venture into the digital-media space. SM Prime President hans Sy signed a memorandum of agreement with Solar unit Omni Digital Media Ventures Inc., leading to the formation of a joint venture that will operate the video-on-demand business under the existing brand Blink. SM Prime, through SM Lifestyle and

entertainment Inc., which runs SM cin-emas and other entertainment facilities, will take 60 percent of the venture, with Omni Digital owning 40 percent. Omni Digital will operate Blink. Officials said the two parties will invest about $20 million for the venture that seeks to expand the services currently being offered by Blink, such as offering movies right after their showing runs in theaters were finished. “I don’t see an impact [on the SM theaters]. As a matter of fact, what we’re trying to do is to make the pie bigger. We’re reaching out to

SUNRISE SUNSET

6:07 AM 5:25 PM

MOONRISEMOONSET

4:40 AM 4:32 PM

TODAY’S WEATHERMETROMANILA

LAOAG

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METRODAVAO

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3-DAYEXTENDEDFORECAST

3-DAYEXTENDEDFORECAST

CELEBES SEA

LEGAZPI CITY25 – 30°C

TACLOBAN CITY24 – 29°C

CAGAYAN DE ORO CITY

METRO DAVAO24 – 32°C

ZAMBOANGA CITY24 – 33 °C

PHILI

PPIN

E ARE

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SABAH

(AS OF DECEMBER 4, 5:00 PM)

PUERTO PRINCESA CITY 24 – 31°C METRO CEBU

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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 5, 2014 | FRIDAY

HIGH TIDEMANILA

SOUTH HARBOR

LOW TIDE

4:05 AM -0.08 METER

TUGUEGARAO CITY 22 – 29°C

LAOAG CITY 23 – 31°C

METRO MANILA24 – 32°C

TAGAYTAY CITY 22 – 30°C

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SATURDAYDEC 7 DEC 8

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Partly cloudy to cloudy skies with Rains with gustywindsStormy

isolated rain showers and/or thunderstorms

Cloudy skies with rain showers and/or thunderstorms.

HALF MOON

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BAGUIO CITY15 – 23°C

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8:27 PMDEC 06

SUNDAY SATURDAYDEC 7 DEC 8

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SUNDAY

10:28 AM 0.36 METER

Partly cloudy to cloudy skies withisolated rain showers

TYPHOON “RUBY” (HAGUPIT)WAS LOCATED AT 720 KM

EAST OF SURIGAO CITY.

Light rains

Typhoon is a cyclone category with winds of 118 - 181 kph.

Construction. . . continued from a8

SM Prime. . . continued from a1 Bonus. . . continued from a1

Growth. . . continued from a1

BusinessMirror news@businessmirror.com.ph Friday, December 5, 2014A2

Newsa lot more other [audience]. So we’re very positive about this and there’s opportunity,” Sy told reporters when asked if it will affect the company’s cinema business. “Our goal is to reach out to more people as possible. Remember the early times, rent-a-betamax became the in-thing. It was so rampant then. So we just felt we do it on a digital space now,” he added. SM officials said initially, Blink services will be bun-dled with other SM products such as its movie houses, skating rink and bowling, among others. According to Ronan de Guzman, director and COO of Omni Digital, the company is targeting to make money in about two years, although it needs to educate people on how to use the system that is relatively new to the country. “We can’t have revenues immediately. And the reason for that is because people need to be taught on how to use it. This is not like a text [short messaging service] that you already know. We’re also investing in a lot of education,” de Guzman said. As early as March next year, he said SM may decide on what movies it will show exclusively on Blink, which has been operational for more than a year now, offer-ing mostly Hollywood-produced moves and television shows, secured by the Solar Group. “Solar has been in the content business since 1973. So we know how to look at content, especially how to get it to Filipino consumers,” he said. Video-on-demand streaming service, which can be accessed online and through desktop or laptop com-puters, tablets and even smart TVs, is more popular in the West and other developed nations due to their high Internet speeds. The said service is harder to implement in countries such as the Philippines where Internet speeds are low. Solar, however, said it has partnered with carriers Smart and Sun Cellular, and it also has know-how to detect a bandwidth speed in order to properly show a movie or a television show even on low bandwidth. SM Cinemas generated P913 million in ticket sales during the third quarter of the year, up 16 percent from P789 million last year. This brought the nine-month ticket sales to P3.3 billion, an increase of 21 percent.

by ordering the Department of Finance (DOF) and Bureau of Internal Revenue to speed up the issuance of the implementing rules and regula-tions (IRR). Communications Secretary Her-minio B. Coloma said the Palace will wait for the final congressional ap-proval and then subject the measure to Executive review. “Hihintayin nating maganap ang mga nararapat na proseso [we will wait for the completion of the entire process],” Coloma told reporters at a news briefing on Thursday. In a bid to fast track the process, the Senate and the House of Represen-tatives agreed to bypass the congres-sional conference committee tasked to reconcile conflicting versions of the bill passed by the two chambers. The House initially set a P70,000 cap but agreed to adopt the Senate-approved P82,000 cap to facilitate final approval as a Christmas gift to workers anticipating the benefit. Coloma, however, said the Presi-dent would leave it up to the DOF and the BIR to lay down the IRR for the upward adjustment of tax exemptions on bonuses once the congressional process is completed and the approved bill is transmitted to the Executive. He explained that after the law-makers from both chambers take the final vote and Congress trans-mits the approved measure to the Executive branch, the Office of the President will then review the final version as part of the last stage in the process of its enactment into law.

This was followed by the growth in the value of alterations and repairs of existing structures, which grew 37.1 percent to P7.9 billion from P3.9 billion registered during the same period of 2013. The value of residential buildings increased by 19.9 percent to P44.2 billion from P36.9 billion recorded in the same quarter last year. This was despite the 5.7-percent decrease in the number of residential building projects to 20,602 from 21,842 projects repor ted during the same period of 2013. The decline in number was due to the decreases observed in the construction of single-type houses at a contraction of 10.1 percent; apartment/accessoria, 1.5 percent; and other types of residential dwellings, 15.9 percent. “However, increments in residential type of construction projects were registered for duplex/quadruplex [295.9 percent] and residential condominium [45.5 percent],” the PSA said. Overall, the total number of construction projects generated from approved building permits was recorded at 29,616 during the third quarter of 2014.

This represented a slight increase of 471 projects or 1.6 percent compared to 29,145 construction projects over the same quarter in 2013. Data show that the number of nonresidential construction projects increased 17.4 percent to 3,832 from 3,263 reported during the same period of last year. The increases in nonresidential construction projects were attributed to agriculture-related projects which posted a growth of 84.3 percent; institutional, 27.6 percent; commercial, 18.9 percent; and industrial, 12.4 percent buildings. Further, additions to existing structures with 1,333 projects rose 18 percent compared to 1,130 projects during the same period of 2013. Similarly, alterations and repairs of existing structures increased 32.3 percent to 3,849 from 2,910 construction projects. Most construction projects were located in three regions in the Luzon area, which accounted for 63.5 percent of the total. This was composed of the Calabarzon which accounted for 6,881 projects or 23.2 percent; Region 3 (Central Luzon) with 3,389 or 11.4 percent; and National Capital Region with 3,256 or 11 percent. Cai U. Ordinario

The most used app, however, is Facebook with an 89 percent overall reach, and an av-erage usage of 37 minutes a day per smart-phone owner. “The media landscape is transforming exponentially with more consumers getting savvy and sophisticated with how they ac-cess content,” Santos said. “As we have more consumers connecting to the Internet with more frequency, with longer duration, and through various por-table devices, marketers have to consider how to tap into this opportunity to engage

with the evolving consumer,” he added. At home, the use of tablets has overtaken the use of traditional entertainment devices such as televisions and radios. The report reveals that 9 in 10 tablet own-ers use the device in their homes, accessing the Internet through a Wi-Fi connection. Nielsen data showed that tablet owner-ship nationwide is at 8 percent in 2014 com-pared to 5 percent last year. “While the homes used to be the turf of television, tablets and smartphones are swiftly encroaching on the territory,” Santos observed. The report reveals the latest trends in

consumers’ digital platform ownership, be-havior and attitudes across the Philippines using the only on-device measuring tool in the country. The report provides a comprehensive view of Internet usage and how marketers will be able to capitalize on emerging trends to be able to target consumers better through the Internet specifically through smartphones or tablets. As part of the study, Nielsen uses an on-device meter that passively captures the be-havior of consumers on their smartphones to monitor what consumers actually do with the device.

Affordability, variety driving up ownership of smartphones in PHLContinued from A8

6.4 percent next year and 6.1 percent in 2016. The report noted that the small bud-getary shortfall under the Aquino admin-istration and the fast economic growth of the $270-billion economy has allowed the government to accelerate public spending, particularly for infrastructure. “The Philippines has kept budget deficits relatively small under President Benigno Aquino, allowing some room for maneuver. Fast growth, forecast at 6.6 percent for 2014, allows progress on improving the country’s underdeveloped infrastructure,” ICAEW’s report said. The country’s economic growth for the next five years, however, was seen declining but should remain one of the strongest output growth among the six Asean economies. The report also pro-jected Philippine GDP growth proving higher than the growth of the Asean re-gion as a whole from 2014 to 2019. PNA

Assistant Ombudsman Asryman Rafanan said in a news conference on Thursday that Ombudsman Conchita Carpio-Morales ordered Purisima and 14 officers on preventive-suspension status for six months without pay amid administrative investigation. Other police officials suspended with-out pay are Police Director Gil Meneses, former chief of the Civil Security Group; Chief Supt. Raul Petrasanta; Chief Supt. Napoleon Estilles; Senior Supt. Allan Par-reño; Senior Supt. Eduardo Acierto; Senior Supt. Melchor Reyes; Supt. Lenbell Fabia; Chief Insp. Sonia Calixto; Chief Insp. Nel-son Bautista; Chief Insp. Ricardo Zapata; and Senior Insp. Ford Tuazon. Purisima is currently in Saudi Arabia attending an international conference, according to Palace Chief Spokesman Ed-win Lacierda quoting Interior Secretary Manuel A. Roxas III. “The implementation [of the suspen-sion order] is a function of when it was received and to whom the order was ad-

dressed to,” Lacierda said when asked if the Office of the President will read-ily comply with the directive from the Ombudsman handling the case against Purisima and several PNP officers. The Palace official further quoted Roxas as saying that the Department of the Interior and Local Government (DILG) chief has yet to get a copy of the suspension order. “I have not yet seen the order and will withhold comment until then,” Roxas said in reply to media inquiries. The administrative and criminal com-plaints against Purisima stemmed from an allegedly anomalous PNP delivery service contract with private company Werfast Documentary Agency in 2011. The administrative case is separate from a plunder case filed against them by a certain Glenn Gerard Ricafranca of Barangay Capantawan in Legazpi City, according to Rafanan. That case is also in connection with another allegedly anomalous contract

news@businessmirror.com.ph Editor: Dionisio L. Pelayo • Friday, December 5, 2014 A3BusinessMirrorThe Nation

with Werfast three years ago. Purisima, who is also the Grand Master of freemasons in the juris-diction of the Philippines, also faces separate graft and plunder complaints over allegation of irregularities in the construction of the P25-milion “White House,” his official residence inside Camp Crame in Quezon City.

Missing assault riflesMEANWHILE, Rafanan said Petras-anta, Acierto, Parreño and Zapata were also ordered suspended for six months in connection with a separate case in-volving missing AK-47 assault weapons. Aside from the four, other police of-ficials the Ombudsman ordered sus-pended related to this case are P/C Supt. Regino Catiis; P/Supt. Nelson Bautista; P/C Insp. Ricky Sumalde; P/C Insp. Ro-drigo Benedicto Sarmiento; SPO1 Eric Tan; and SPO1 Randy de Sesto. Nonuniformed personnel Nora Pirote, Sol Bargan and Enrique de la Cruz were also ordered suspended by the Ombudsman because of this case. It would be up to the DILG to decide on how it will implement the orders against these police officials. Based on a complaint filed by the Fact-Finding Investigation Bureau of the Ombudsman, the PNP Criminal In-vestigation and Detection Group issued an Investigation Report dated July 14 revealed that private security agencies and a mining company successfully ap-plied and were issued firearms licenses by the PNP using falsified and incomplete documentary requirements.

Based on the PNP database, 1,004 li-censed firearms were released through the submission of incomplete and/or falsified applications submitted by Isidro Lozada, owner of Caraga Security Agency. Caraga bought the firearms from Twin Pines Inc. that, in turn, facilitated and submitted the falsified and/or incomplete license applications of Lozada to the PNP Firearms Explosive Office (FEO). Despite irregularities in the applications, licenses were processed and approved by PNP-FEO officials and personnel.

Off to the courtPNP Spokesman Chief Supt. Wilben Mayor said that while they would abide by the order of the antigraft body, they would also seek legal remedy to address it. “The PNP respects the decision of the Ombudsman and we will exhaust all necessary and available legal reme-dies,” Mayor said during a news briefing on Thursday. “Preventive suspension is not a penalty. It’s a preventive measure so that the respondent cannot influence the investigation,” he added. The PNP claimed that the memoran-dum of agreement between the PNP and Werfast covering the contract started even before Purisima took over as head of the PNP. Mayor said the suspension of Purisima is one of the hazards that not only the PNP chief but all government employees face. But this should not affect the whole police organization. “That is part of our job. For a govern-ment official, it’s part of our job to be prepared for any eventuality,” he said.

Ombudsman suspends police chief on corruption chargesBy Jovee Marie N. dela Cruz, Butch Fernandez & Rene Acosta

THE Office of the Ombudsman suspended Philippine National Police (PNP) chief Director

General Alan LM Purisima and other top police officials in connection with the P100-million contract they entered into with a courier service in 2011.

GOVERNMENT institutions of military and scientists announced they have placed personnel on high alert for the impact of Typhoon Ruby (interna-tional code name Hagupit), which has been declared a super typhoon by

state weathermen.Armed Forces of the Philippines (AFP) Chief of Staff Gen. Gregorio Pio Cata-

pang announced on Thursday afternoon that the military was put on red alert.“As of noon today, the whole Armed Forces is already on a red alert, more

particularly Central Command Units, in preparation for Typhoon Ruby. This is to ensure availability of troops and equipment for immediate response,” newly installed military spokesman Col. Restituto Padilla said.

“We must ensure our level of preparedness so that we can provide the appropriate support to the local government and the regional risk-reduction management of each locality, particularly those forecasted that will be hit by the typhoon,” he added.

Padilla said the alert status required all soldiers, including those who are on official leave, to report to their respective units.

Aside from personnel, all available military assets, including planes, heli-copters and vessels were placed on standby, ready to be used in the rescue and relief operations should they be needed, he added.

Maj. Emmanuel Garcia, point man for the military’s Humanitarian Assistance and Disaster Relief operations, said all units and personnel in the areas that will be affected by the typhoon have been ordered to coordinate with local govern-ment units and other government agencies for a concerted response, including undertaking preemptive and forced evacuations.

Philippine Atmospheric, Geophysical and Astronomical Services Administra-tion (Pagasa) Officer in Charge Vicente Manalo said Ruby should affect the eastern section of the Visayas as it entered the country on Thursday.

“It will further intensify as it nears the land,” he said at the meeting pre-sided by President Aquino at the National Disaster Risk Reduction and Man-agement Council. He said the typhoon will hit Eastern Samar and affect the Bicol region, the rest of Southern Luzon and the Visayas, as it will make a landfall on Saturday, with its rain projected as being heavy to torrential. “Coastal waters of Eastern Luzon up to Mindanao will be rough, and as of today, we are already advising that small bancas will not be allowed to sail,” Manalo said. The government’s chief scientist, meanwhile, called on the public to monitor developments on Ruby through weather bureau Pagasa and Proj-ect Noah. Rene Acosta

Government on alert for Hagupit’s whip

FPI Chairman Jesus L. Arranza told reporters on Thursday that the De-partment of Trade and Industry (DTI) should talk to the business community first, particularly in the transportation and logistics sector, to reiterate the ef-fect of the declining oil prices.

Early this week, Trade Secretary Gregory L. Domingo called on pro-ducers of goods and services for price adjustments realizing the effect on

transportation cost of the declining pump prices in the world market.

Arranza, however, said the Depart-ment of Trade and Industry should meet first with the truckers who are collecting higher fees due to the Ma-nila port congestion.

He added that the price adjustments should be a “chain reaction” than di-rectly ordering the manufacturers to slash prices of goods and services.

BusinessMirror news@businessmirror.com.ph A4

Economybriefs

mmda to dispatch christmas shuttle service starting fridayThe Metropolitan Manila Development Authority (MMDA) will dispatch shuttle services to major malls along edsa starting 11 p.m. on Friday as part of the agency’s Christmas efforts. MMDA Chairman Francis Tolentino on Thursday said this measure will complement the adjusted mall operating hours being implemented now and is in response to the concern raised by mall employees and shoppers of the apparent lack of enough public-utility vehicles during nighttime, when the MRT is no longer in operation. Four public-utility buses, identifiable by stickers bearing the words “MMDA Christmas Shuttle,” will be dispatched to six major malls to ensure that mall employees and last-minute shoppers will be ferried to their various destinations. The six malls included in the shuttle service provision are as Starmall, SM Megamall, SM North edsa, SM Mall of Asia, eton Centris and TriNoma Mall. The MMDA will deploy one dispatcher from the Task Force Takipsilim per participating mall. PNA

solon rejects bilateral negotiations with china over kalayaan islandsIN view of the increasing construction activities of China in the West Philippine Sea, a lawmaker from the house of Representatives on Thursday urged the Philippine government to resist any pressure to enter into bilateral talks with the economic giant regarding the disputed territory.

Nationalist People’s Coalition Rep. Sherwin Gatchalian of Valenzuela City said the Philippines should continue playing hardball with China in terms of the ongoing territorial dispute since sitting with China in a negotiating table is akin to almost waving the white flag.

“There should be no bilateral negotiations. Why should we negotiate our own backyard?” Gatchalian, who is a majority member of the house committee on Foreign Affairs, said.

“The Philippines should not allow China to bully its way into claiming practically all of the disputed waters. It will certainly use its economic and political force as leverage on the Philippines,” he added.

Reports showed that China has a big reclamation project on Kagitingan Reef (Fiery Cross Reef ) in the Kalayaan Group of Islands (known internationally as Spratly Islands) to convert it for military use, particularly the Chinese Navy. A Chinese state-run newspaper also wrote that the Philippines and Vietnam should get used to more construction projects by the country in the South China Sea. PNA

The Outstanding Filipino (Tofil) Award of the  Junior Chamber International (JCI) Philippines has chosen Albay Gov. Joey Salceda as one of its three recipients for 2014. his award is in the field of exemplary public service.  Now on its 26th year, the prestigious Tofil Awards is a project of the JCI Senate in partnership with Insular Life. It honors individuals whose services and innovative initiatives contribute immensely to the advancement of their fields of discipline. Previous Tofil awardees include such names like Jaime Cardinal Sin, Lorenzo Tañada and Jovito Salonga, among others.  Salceda earned his 2014 Tofil award for his transformative stewardship and building of social cohesion, which enabled unprecedented achievements by Albay of its Millennium Development Goals, climate-change adaptation, environmental promotion, disaster- risk reduction and holistic programs in health, education, food sufficiency and tourism advancement. PNA

By Jovee Marie N. dela Cruz

THE chairman of the Senate Committee on Finance on Thursday asked the House of Representatives to junk the P53.9-billion Metro Rail Transit (MRT) 3 buyout plan in its proposed version of the 2015 na-

tional budget bill. During the bicameral conference committee on the proposed budget, Sen. Francis “Chiz” Escudero said that a government buyout of the MRT 3 is a waste of money. “We [the Senate] removed the provision for MRT 3 buyout. The allocation for the MRT buyout is P53.9 billion. Why spend P53.9 billion on something that won’t im-prove the plight of the riding public insofar as the MRT 3 is concerned?” he said. The Department of Transportation and Communications (DOTC) planned to buyout Metro Rail Transit Corp. (MRTC) in a bid to improve the services of the MRT 3 that serves commuters from Quezon to Pasay cities. Chairman of the Committee on Appropriations and Liberal Party Rep. Isidro Ungab of Davao City has said that the House of Representatives has provided P53.9 billion in its proposed P2.606-trillion 2015 national budget for the government buyout and takeover of the operations and management of the MRT 3. Escudero said he is also wary that the bulk of the takeover appropriation will just be used to pay for the bonds held by state-owned Land Bank of the Philippines (LandBank) and the Development Bank of the Philippines (DBP), which controls 80 percent of MRTC, the owner of the mass-transit railway. “Even if we buy it out, it will not improve the service anyway, it will only go to the pocket of one agency to another, namely, LandBank and the DBP,” he said. According to Escudero, the Senate doesn’t see any improvement in the MRT 3 service even after spending P53.9 billion for the buyout plan. “So, instead, we reallocated the unprogrammed fund to cover approximately P10 billion to improve the MRT 3,” he said. Escudero said that it is better to realign the fund to more essential serv-ices for the general public, like the much-needed infrastructure to ease traffic congestion and disaster-preparedness programs. The senator, however, said the issue on the MRT 3 buyout will still be un-der discussion between members of the bicameral committee. Earlier, Metro Rail Transit Holdings II Inc. Chairman Robert John L. Sobre-peña said the benefits from the planned takeover of the MRT 3 are minimal to nil, as it only provides for the exchange of money from one government agency to another. He said the multibillion-peso budget is not enough to compensate for the whole train line, as the amount only accounts for the bonds owned by the DBP and Land-Bank. “The P54-billion equity value buyout would not in any way benefit the main-tenance and rehabilitation of the MRT 3 system, but will only be used to retire the bonds already owned by DBP and LBP," he said in a BusinessMirror report.

definition of savingsMEAnWHILE, members of the bicameral conference committee have agreed to adopt a new definition of savings. Escudero and Ungab, in a news conference also on Thursday, assured the public that the bicameral committee’s definition of savings complies with the Supreme Court decision against the Disbursement Acceleration Program. “[How-ever] we haven’t approved it yet. It’s a bicameral conference committee proposal. There’s a working draft already [on the definition of savings],” Escudero said. Under the bicameral committee recommendation on the use of savings, the President, the Senate president, Speaker of the House, Supreme Court chief jus-tice, the head of constitutional commission enjoying fiscal autonomy and the Ombudsman are authorized to use savings in their respective appropriations to augment actual deficiencies incurred for the current year in any item of their respective appropriations. It also said that the foregoing constitutional officers authorized to use savings shall be responsible for ensuring that a semestral and annual report on their respective use of savings shall be submitted to the Senate Committee on Finance and the House Committee on Appropriations, copy furnished the Department of Budget and Management. Savings refer to portions or balances of any released appropriations in this, which have not been obligated as a result of any of the following: Final discontinuance or abandonment of an ongoing program, activity or project (PAP) by the head of the agency concerned due to cause not attrib-utable to the fault or negligence of the said agency. non-commencement of the PAP for which the appropriations is released. For this, purposed, non-commencement shall refer to the inability of the agency or its duly authorized procurement agent to obligate the released al-lotment and implement the PAP due to natural or man-made calamities, or other causes not attributable to the fault or negligence of the agency concerned during the validity of the appropriations.

By Joel R. San Juan

FORMER Manila City Councilor Greco Belgica has joined the petition before the

Supreme Court (SC) to stop Congress and the Palace from implementing the 2015 proposed national budget of P2.606 trillion for having lump- sum appropriations. In a 36-page memorandum, Belgica also urged the SC to declare void and unconstitutional four items in the 2014 General Appropriation Act (GAA) with less than a month left in the fiscal year. He specifically cited the Unprogrammed Fund, E-Government Fund, Contingent Fund and Local Government Support Fund, which he stressed are similar to the Priority Development Assistance Fund (PDAF) that was declared unconstitutional in november last year. “When the Honorable Court struck down the pork-barrel system unconstitutional, it was made clear that lump-sum discretionary funds are anathema to the Constitution because it violates, among others, the nondelegation clause and the essence and purpose of separation of power principle in the Constitution and the power of line-item veto by the President,” petitioner argued. Earlier, former Iloilo Rep. Augusto Syjuco Jr. filed a petition seeking to stop the approval and enactment of the GAA for next year and its attached national

Expenditure Program (nEP) due to alleged inclusion of lump-sum appropriations. named respondents in the case were Budget Secretary Florencio B. Abad, Senate President Franklin Drilon and House Speaker Feliciano Belmonte Jr.  He added that the nEP and 2015 General Appropriations bill are unconstitutional as they redefined the term savings to circumvent the SC’s decisions on the unconstitutionality of acts and practices under the Disbursement Acceleration Program (DAP). Likewise, Syjuco said the lump- sum appropriations contained in the nEP 2015 and the proposed budget for 2015 are unconstitutional in line with the Court’s ruling in Belgica et. al v. Secretary Paquito Ochoa et. al., where it declared lump-suym budgeting as unconstitutional. The lump-sum items in the proposed budget include the President’s Special Purpose Funds (SPF), also known as the President’s pork barrel, amounting to P501.67 billion or 29 percent of the proposed appropriations for 2015; and the Grassroots Participatory Budgeting, previously called “bottom-up budgeting,” amounting to P20.9 billion. Syjuco also noted that the P20.9-billion budget allotted for local government units is on top of the P2.9-billion local government support fund included in the P501.670-billion SPF. 

By Lenie Lectura

EnERGy Development Corp. (EDC), the geothermal com-pany of the Lopez Group, on

Thursday said the second unit of the Bacon-Manito (BacMan) geothermal power plants has put in an additional 5 megawatts (MW) of generating ca-pacity following an upgrade of the turbine design. “The BacMan Geothermal Inc. [BGI], the wholly owned subsdiairy of EDC that owns and operates the BacMan power plants, is now operating Unit 2 at 60 MW gross, an increase of 5 MW,” EDC said. The increased capacity was a di-rect result of the upgraded Toshiba turbine design, it added. “Recall that the installation of the brand-new Toshiba steam turbine rotor unit and diaphragms was completed in Septem-ber 2014,” EDC added. The need to install a new turbine was necessary after the facility was damaged in 2013. Prior to the upgrade, the BacMan plants had a generating capacity of 130 MW from its 55-MW Units 1 and 2 and 20-MW Unit 3. By March 20 next year, BacMan Unit 1 is expected to resume com-mercial operations. The Bacman facility is located in the towns of Bacon, Sorsogon province and Manito, Albay province.

Friday, December 5, 2014 • Editors: Vittorio V. Vitug and Max V. de Leon

salceda bags 2014 tofil award

Escudero: Junk P53.9-B MRT 3 buyout proposal

fpi to dti: hold consultation before imposing commodity-price slash

The Federation of Philippine Industries (FPI) on Thursday sought for consultations between

the government and the private sectors before the former imposes any order to slash the prices of goods amid global cuts in fuel prices.

He also mentioned that aside from fuel cost, other costs affecting prices of goods include raw materi-als, labor and processing cost, which are not directly affected by declin-ing oil prices.

“There are many other cost com-ponents. The DTI should talk to the nPCC [national Price Coordinating Council] first. We, manufacturers, will voluntarily give rollback on prices if we know that we should,” Arranza said.

Based on data of the energy depart-ment, average oil prices in the local market have gone down by about 20 percent this year—from P44.63 per liter in January to P36.71 in november.

The declining oil prices were pushed by the decision of world’s oil produc-ers’ cartel Organization of Petroleum Exporting Countries to maintain pro-duction at 30 million barrels per day.

This immediately pulled down the price of the benchmark Brent crude to $72 per barrel. PNA

EDC boosts 2nd unit of BacMan geothermal power plant by 5 MW with turbine upgrade

Belgica joins petition to void P2.606-T 2015 budget bill

breakfast delight A vendor in Barangay Caloocan, Santiago City in Isabela peddles her merchandise of smoke cooked golden brown milkfish (tinapang bangus) to buyers and market goers. Smoked milkfish is a favorite breakfast dish among many Filipinos. LEONARDO PERANTE II

“I have 100 MW worth of hydro-power projects in the pipeline, all in Luzon,” AVGarcia Power Systems Corp. President and Chairman Ade-lino Garcia Jr. told the reporters on Thursday at the “Energy Investors Forum” at the InterContinental Ho-tel in Makati City. The investment cost is ap-

proximated at P150 million per MW amounting to a total cost of P15 billion. Among the projects is the 800 kilowatt-hours (kWh) hydropower from river run-off, at the Biyao River in Balbalan, Kalinga, which is tar-geted to commence construction by summer. It has already been offered

news@businessmirror.com.ph Friday, December 5, 2014 A5BusinessMirrorEconomy

By Joel R. San Juan

THE Commission on Elections (Comelec) junked on Thurs-day petitions that seek to

blacklist technology provider Smart-matic International Corp. from par-ticipating in the public bidding for the P2.5-billion contracts for addi-tional voting machines and other requirements for the 2016 elections. In its Resolution 1 dated Dece-ber 3, the Comelec-Bids and Awards Committee (BAC) headed by Helen Aguila-Flores found no basis to grant the petitions filed by nine groups claiming to be election watchdogs, led by Citizens for Clean and Credible Elections (C3E) against Smartmatic. The Comelec-BAC held that C3E has no legal personality to initiate a blacklisting complaint against the multinational company as it is neither a bidder nor duly authorized observer. Similarly, the BAC said its author-ity to blacklist bidders is based only on the present bidding process and not on previous ones, such as what took place five years ago. “This present BAC, which was constituted for purposes of procur-ing goods and services in connection [with] the regular requirements of the commission for the current year and for 2015 and 2016 electoral ac-tivities, has no jurisdiction over the complaint at hand,” the panel said. It added that the allegations raised by the petitioners were premature considering that Smartmatic has yet

to submit its eligibility documents for the present bidding process. “Still, we could not rule on any al-leged misrepresentation committed by any bidder in connection [with] the procurements at hand,” BAC said. Flores said complainants may still appeal their ruling either to the Comelec en banc or the Su-preme Court. The decision to allow Smartmatic to participate in the bidding was an-nounced during Thursday’s opening of bids for the lease of optical mark reader system. Only Smartmatic-TIM Corp. and Indra Sistemas submitted their eligibility requirements and initial technical proposals to the BAC, even as E-Konek Pilipinas Inc., Election Systems & Software, and Miru Sys-tems Co. Ltd. also purchased bidding documents for P75,000 each. Aguila-Flores said they were sur-prised that only two participated in the bidding since there were many groups who have signified their in-tention to join by purchasing the bidding documents. “In fact, we divided the storage area into so many as there were bid-ders who bought the bidding docu-ments,” said the poll official. “We allocated two weeks for this. But since dalawa sila, baka mapaikli naman. Depende sa mga process na ide-demonstrate nila sa amin. Walang time limit ’yun but we sought author-ity to work overtime on this,” said Aguila-Flores said.

a bilateral contract from Kalinga Electric Cooperatives Inc. “We still want to hit the ground before summer of 2015 because we have to ensure that it flows low. It’s easier to construct, because if you let this year pass, you have to wait for another year,” he said. The project can be completed in 16 to 18 months from summer, ac-cording to Garcia. The project will be partly funded by a P100-million loan from the Development Bank of the Philippines. However, he said that the construc-tion is still awaiting two permits from the National Water Rights Board and the National Commission on Indige-nous Peoples . It has already obtained

a Certificate of Commerciality from the Renewable Energy Management Bureau. The project has already garnered 58 signatures on the local government unit level, but cannot move due to the two pending permit requirements. Aside from the Kalinga hydro-power project, Garcia said the com-pany has two more hydro and one more solar project. AVGarcia Power Systems Corp. is an energy resource company that provides turnkey solutions to ener-gy requirements, spanning energy generation plants from renewable to conventional, transmission lines and substations, to commercial and industrial power systems. PNA

P15-B Luzon hydropower projects in the pipelineFiFteen billion pesos worth of

hydro-electric power projects in Luzon rated at 100 megawatts

(MW) are in the pipeline for AVGarcia Power Systems Corp.

Comelec junks petitions to blacklist Smartmatic

ElitE-lEd political systems in asia and the pacific are the basic hindrances to people-centered sustainable develop-

ment, according to former National treasurer leonor Magtolis-Briones. Briones, also a professor emeritus at the National center for public administration and Governance at the University of the philip-pines in diliman (Up diliman), made the as-sertion during the United Nations Economic

and Social commission for asia and the pacific Expert Group Meeting on “Macroeconomic prospects, policy challenges and Sustainable development in asia pacific” on december 2 in Bangkok, thailand. “the elite controls the Executive, the legis-lature and in some countries try to control the Judiciary. Usually, the spoil system operates, even in countries which claim to be democratic,” Briones said.

Her indictment is particularly applicable to the philippines, where Malacañang has been clashing with the judiciary over the consti-tutionality and legality of the disbursement acceleration program that it implemented in spending p144 billion for 116 projects using taxpayers’ money. Most of the expenditures were not covered by appropriations under the national budget for 2011 and beyond. Briones said the other barriers

are obsession with the gross domestic product as a measure of development, and widespread corruption exacerbated by lack of transparency and information, limited public participation, and lack of accountability. “a political system dominated by the elite stifles governance and economic and social devel-opment. it results in corruption, bad governance and poor accountability. democracy becomes a farce,” Briones said. Marvyn N. Benaning

‘Elite-led systems hindrance to sustainable devt in Asia’

Editor: Alvin I. DacanayFriday, December 5, 2014

OpinionBusinessMirrorA6

Here comes a test for the government

editorial

On november 8 we marked the first anniver-sary of Supertyphoon Yolanda (international code name Haiyan). The government told the people then that everything had been done to

rehabilitate the lives, homes and areas heavily damaged by that disaster. It also told them that it would be more prepared in avoiding what happened 13 months ago.

The government and its words will be put to the test in the next few days, when Supertyphoon Ruby (international code name Hagupit) is expected to hit the Philippines. As of this writing, it is too early to tell where exactly the storm is going to hit. But, as of now, this is what we do know.

The United States’s Joint Typhoon Warning Center (JTWC) said the storm could produce maximum winds of 222 kilometers per hour (kph), with gusts of up to 268 kph by Saturday. The force these winds pack is about the same as those produced by Yolanda.

Weather forecasters, like the JTWC, use models that take into account the performance of previous storms, both in terms of the track and how external conditions, like sea temperature, influence the storm. As of this writing, the JTWC said in its latest report that Ruby “continues to intensify well above model guidance, as well as increasing in size.” This means this storm could actually be stronger than Yolanda.

Ruby now has about a 70-percent chance of hitting the Visayas, according to the Philippine Atmospheric, Geophysical and Astronomical Services Administration. But, as we have learned from past experiences, where the storm would eventually make landfall is hard to predict until the last 24 hours or so before it hits.

The storm could even turn northward. The JTWC said: “There is a high prob-ability that the system will start to turn poleward [toward the north].” Unfor-tunately, there is a high-pressure area off the eastern coast of Japan that might keep Ruby on its current track. While unlikely at this point, the storm could even pass through or near Metro Manila. By Sunday or Monday, we will know.

Regardless of where Ruby moves, the key issue, by this time next week, would be how well (or how poorly) the government has responded to the typhoon, even if there is no direct hit. More than 50 provinces are on Ruby’s path, and the Department of the Interior and Local Government and the Department of Social Welfare and Development, as well as the Armed Forces of the Philippines, are on full mobilization mode.

Like all Filipinos, we are hoping and praying that the country would be spared. And if those prayers would not be answered the way we want, then we pray that the government has been honest in its disaster- preparedness assessment.

In recent days anti-automationists have been trying to explain their position to a public that is overwhelmingly in favor of election automation. Their frustration shows in the recent claim

that those favoring automation “are not capable of understanding” their explanations or are, perhaps, being deliberately dense. I suppose it has never occurred to anyone that these explanations are simply not convincing.

WOMEn’S networks offer opportunities for women to connect, belong, do business, ask questions and share information. In business, few women’s networks exist,

mainly because women find it difficult to get together, on account of their responsibilities to their respective families. With technology already a constant presence in our lives and a driving force in the success of any business, women need to come together online to connect, learn and be heard.

An illusion of simplicity

An ICT platform for women’s networks

I’m paraphrasing, but the sum total of the anti-automation apologia is this: automation only speeds up counting by 12 hours, and this gain isn’t worth the P16 billion alleged to be the cost of automation.

This “simple analysis” is wrong on both counts. Automation speeds up the counting and election-returns preparation by nearly 100 percent. With automation, counting is virtu-ally instantaneous and election re-turns are printed out within minutes. And, of course, the cost of procuring counting machines to be used for au-tomation comes up to only P2.5 bil-lion for both optical-mark reader and direct-recording election machines.

But even disregarding the inaccu-racy of the figures being presented to the public, the clear import of presenting this “hours gained versus money spent” argument is the belief that automation does nothing but

speed up the process.Wrong. Speed is merely a side ef-

fect. The goal of automation is to minimize the effects of human er-ror and fraud on the accuracy of the counting of the votes and the prepa-ration of election returns. On that point alone, any attempt to turn the question of whether or not to auto-mate into an issue of time-keeping should be rejected.

There are other side effects, tool: improvement in the ability of voters to express their intent via an easy-to-use ballot that eliminates the effects of poor handwriting and illiteracy; reduction of the risks faced by the teachers on the boards of election inspectors; and the improvement of the ability to recount ballots via the preservation of ballot images on encrypted digital-storage devices.

none of these benefits are avail-able in manual counting. In fact,

about the only thing that anti-auto-mationists can put forward is their claim of transparency, defined as giving people the opportunity to watch as individual ballots are be-ing counted, and election returns are being prepared and encoded for electronic transmission. Admittedly, that would be transparent, indeed, but only if all the different compo-nents of the plan work according to expectation and if the entire process could be kept watch over with uni-form integrity throughout the more than 82,000 precincts where it will be unfolding on election day.

Anti-automation explainers put forward a deceptively simple plan that calls for the elimination of automated vote-counting, a return to manual ballot-counting and prepa-ration of election returns, and the introduction of tablets and light-emitting diode projectors (the kind you hook up to a computer so you can regale people with that PowerPoint presentation you stayed up all night making) at the precinct level, all sup-posedly to promote transparency, at the cost of P4 billion—almost double the cost of automation.

But, think about that for a bit. Tab-lets in every single precinct? This will inevitably require that each tablet be installed with a custom-made mobile application that displays the positions being voted for (34 to 36 positions) and the corresponding candidates for those positions (anywhere from one to 12 per position, plus the party-list system). Installing that app in more

than 82,000 tablets requires the same amount of time, effort and expense as configuring counting machines. Ex-cept that you end up with a device that is essentially just a monitoring tool. Figure in the training requirements, and the illusion of simplicity (not to mention cost-effectiveness) begins to unravel. And the more complex a system is, the less likely it is to func-tion 100 percent reliably.

The assumption that monitoring will be of uniform integrity across more than 82,000 precincts is also unrealistic. It presupposes that a majority of precincts will be watched, from the start of counting to its con-clusion, and that in places where the watch is insufficient, no errors or tampering with election results will occur. That’s a bad supposition.

So, if the solution being proposed is unlikely to be reliable and will probably not be uniformly effec-tive throughout the country, then the resulting transparency will be essentially selective and, therefore, pointless. Worse, the appearance of transparency will tend to lull the pub-lic into a false sense of security that might end up being more damaging to the integrity of the elections than the much-trumpeted doubts about a system that, since its first imple-mentation, has survived repeated challenges to its integrity.

And you wonder why you’re not convincing more people.

James Jimenez is the spokesman of the Commission on Elections.

The GREAT Women (GW) Platform is the country’s gender platform. GREAT stands for “Gender Responsive Eco-nomic Action for the Transformation of women”. While it began as a project of the Philippine Commission on Women (PCW), with ECHOstore’s nonprofit ECHOsi Foundation supporting and helping microentrepreneurs prepare and market-test their products, the platform has expanded to become one embraced by multisectoral partners, both in the government and the private sector.

As a private-sector partner, the ECHOsi Foundation has the role of draw-

ing others in the private sector to the GW Platform. A new addition to it is an in-formation-and-communications-tech-nology (ICT) tool that enables women to empower themselves via networking strength. When IBM offered its Smart-Cloud for Social Business as a grant to the ECHOsi Foundation, the latter called in the PLDT-Smart Foundation to be its technology partner-handler.

Together with the PCW and Busi-ness and Professional  Women (BPW) Makati, the GW ICT Platform aims to create an online business and profes-sional network for all women’s groups.

We would like to bring into the network other women’s groups, including the Women Business Council Philippines, female corporate directors and CEOs, SPARK and the network of Enterpris-ing Women. PLDT-Smart Foundation hopes to align their SME nation female entrepreneurs. The PCW and the Depart-ment of Trade and Industry’s Women’s Desk  joint role is to draw gender-and-development (GAD) focal persons in government agencies into this platform for networking opportunities, in such a way that GAD budgets can really support women’s economic development.  The longer-term direction is to invite women in industry and professional groups. The GW ICT Platform may still prove to be the online group where women can sup-port their own value or supply chain in their businesses or professions.

Access to this platform is given to one central person in each group, who in-vites her fellow group members to join the SmartCloud. Once online, they can chat, have group meetings, mentor other women, send an e-mail or instant mes-sages, share resources, and hold secure conferences. Mentoring programs and events can also be held online between individuals or groups.

SmartCloud for Social Business was introduced by IBM in 2010 as a col-laboration suite for small and medium groups, allowing connections within

and outside groups. It’s a grant given by IBM that enables nonprofit organi-zations to work with an IT structure and learn technological skills that are specifically geared to help them serve communities.

The potential is exciting, in that younger women will look to the more established women for lessons, while the latter can share best practices and their business or professional wisdom with their younger counterparts.

The memoranda of agreement have been signed and technology train-ings have been given. now comes the building! The GW ICT Platform will be launched next March—which, appropri-ately enough, is Women’s Month—and will be offered for use by business and professional women for free, and with the goal of building their professional and business networks.

Jeannie E. Javelosa is the founding president of BPW Makati, president of the ECHOsi Foundation, and cofounder of ECHOstore and the EON stakeholder-relations firm.

This article reflects the opinion of the author and does not reflect the official stand of the BPW network. Women Stepping Up is a rotating column of members of BPW Makati and comes out twice a month. For more information on BPW Makati, visit www.womensteppingup.org.

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

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spoxJames Jimenez

Women stepping UpJeannie e. Javelosa

Friday, December 5, 2014

OpinionA7BusinessMirroropinion@businessmirror.com.ph

annotationstito Genova Valiente

WHAT to write when you’re having soft and cozy nights in a lovely hotel surrounded, when viewed from above, by ramparts and histories reconstructed from ruins? The

hotel is Bayleaf Hotel, a retrofitted structure, with rooms elegant in white and dark green. But the beauty remains within the hotel; step out of it and you are in an inhospitable place, with so-called tricycles buzzing past you along dark, dank streets.

From above

Children, nearly naked and black with the soot of the day, loitered around. Two young girls, naked from below the waist, clung to the legs of a poor old man. They were begging, I wanted to assume, and not seduc-ing the guy. A videoke place sealed its destiny beside a stall selling bar-becue. This must be urban Manila at one of its ugliest. The problem with the repugnance you feel as you look at this city, glorified in poetry and prose, is that humans are part of the gross and the unsightly. Evaluate the place and you include the amorphous urban poor.

I thought I knew this city…until that night. I walked out of the spare and clean lobby of the hotel, with its Christmas tree supremely charm-ing with its pastel-hued tassels and buntings, and breathed in the river. It was not pleasant. I looked around,

but there were no available taxis. I decided to walk through Muralla Street and into Padre Burgos Avenue. There were taxis, but there were taxi barkers. These are men who run to the taxi first before you can hail it. They own the taxis, in principle. It seems that you are not allowed to call cabs yourself, unless you are willing to outrun them.

I could walk, I told myself. I then ambled toward the old Congress building, but after a few meters, the area became dark. I rushed back to the underpass area, but three young boys were fighting on the stairs. The commuters, mostly students, were all easing their way down at the farther end of the underpass. A man was heard shouting hoarsely; a woman was heard shrieking. They were try-ing to stop the brawl. We watch too many bad Manny Pacquiao fights, I

wanted to tell them. But they would not honor the irony in my advice, only the truth in that. They like, I assumed, Pacquiao, after all.

The night was becoming enchant-ing, in a gross way. I managed to get back to the front area of the hotel. There was a snaking line of commut-ers waiting for a van to pick them up. The street was dark once more. There were puddles on the way. I just walked and walked, hoping against hope that I would be spared from manholes. The gods were kind to me that night, the gods of instant tourists, like me.

The map of Intramuros, as I know the place, flashed. The im-ages had the power of the scenes and sins that become clear at one’s deathbed. I was not dying, but the deaths of facts about this walled city threatened to fill up a cemetery of diaries. I soon found my way—not glassy-eyed and entranced, as in Nick Joaquin’s many narratives, but anxious—to a street that I felt would lead me to the Walled City of brochures and grand plans.

The street was still dark, and men and pedicabs were all rushing past me. There was traffic, but no traffic enforcer was in sight. The giggling and chatter of young students as-sured me that everything would be alright. There was, however, a scary thing about the confidence of these young boys and girl walking home: I could not sense any fear in them. Are they braver? Or have they just

gotten used to their surroundings?Manila is a city of nice hotels and

homelessness. In that area of the Walled City, children were either sleeping in cots or on the ground. These are children whose families can never be part of the Pantawid Pamilyang Pilipino Program. It wants to bring the families across the threshold of hunger.

These homeless people are can-didates for heartlessness. It is cruel to require transcendence from them. That is a view held by a man who does not know hunger. These children who live along the streets will be fitted with the genes of survival. They will live, most of them, and they will be strong against anyone who claims their streets. They own the avenues in the dark. They own the space where you stand. That is why they will ask for P5 once you encroach on their territory. We never told them what is right. We never taught them lessons about being human.

All these things—the empti-ness, diseases and destitution of the city—were unseen from where I sipped my great coffee that morning. There was just the sweet hotel, and I zooming into a universe where, like the grim and clueless officials of the land, plans and dreams of reforms are exotic and plentiful. Where, like that old song about a woman with a mystic smile, they just lie there and they die there.

E-mail: titovaliente@yahoo.com.

THE year is about to end, and it is likely that the Philippine Stock Exchange index (PSEi) would end 2014 with more than 20-percent growth. This would be a strong reversal of the

5-percent decline that was recorded in 2013. The last few weeks have seen the PSEi approaching the all-time level of 7,400, but has not broken through it yet. This week the market witnessed the debut of Xurpas, a Philippine apps company that posted 50-percent growth on its listing day and added another 41 percent on its second day. Indeed, these are exciting times for the stock market. The question is: Are we going to experience further growth in 2015?

Sustaining the fundamentals:Key to sustaining the financialmarkets’ growth from 2015 onward

EaGLE WatCHDr. alvin P. ang

During a seminar presentation at the Ateneo de Manila University’s eco-nomics department on December 1, Dr. Eli Remolona, chief representative for Asia and the Pacific at the Bank of International Settlements, shared the result of his paper “Investing in Emerging Markets: How do Global Investors Differentiate between Sovereign Risks?” The results of this study are instruc-tive on how we can look at sustaining the future growth of the local market.

The study looked at two periods: pre-2008 crisis and post-2008 crisis. It tracked the risk premium in 29 countries, 19 emerging markets and 10 advanced economies. It found that the main driving factor determining risk premium is correlated with the volatility index (VIX), also known as the fear index. It is the implied volatility of Standard & Poor’s 500 over the next 30 days. This was then correlated with selected fundamental factors in an economy, such as, debt ratio, current-account balance, credit rating, gross domestic product (GDP) growth and if the country is an emerging economy. The study found that, prior to 2008, the credit rating and the emerging-economy tag are strongly correlated to risk premium. However, after 2008, only the emerging-economy tag remained as a key predictor of risk premium.

What can be implied from these results? Consider the table below. The upper group represents the stock indices and GDP performance of the major economies (the United States, Germany and Japan). Their stock-market and GDP growth reflect their current and perceived future performance. The lower group represents selected emerging-market economies, including the so-called Association of Southeast Asian Nations (Asean) 3—Thailand, Indonesia and the Philippines. (There is no standard listing of emerging economies, but most would include the countries in this table).

It would seem that the GDP-growth performance of these countries has been outstripped by the growth of their stock markets by about 300 percent, and that the credit rating is not a key basis for their stock-market perfor-mance. The emerging economies’ stock markets are growing almost at the same pace. This is possibly the result of asset-management decisions, rather than purely fundamentals. This current performance gives credence to the study’s observation that investment decisions are strongly shaped by external asset-management decisions.

Remolona cited the rise of asset management and index-tracking of emerg-ing markets as possible factors in the current strategy of investments. With only the US showing a return to the growth path, and Japan and Europe in recession, it is likely that the emerging markets will continue to experience good returns in their stock markets in the coming year. Nonetheless, it is still prudent not to lose sight of the fact that this is possibly a phase in investment strategy. Another 20 percent for 2015 will have to come from a strong base.

Historically, the average growth of the Philippine stock market has moved about 12-percent above GDP growth. This means that, with an expected 6-per-cent GDP growth for 2014, an 18-percent growth of the market can be easily achieved. For 2015 this will require that the economy go back to its 7-percent growth to justify the fundamental base.

It is also important to note that the negative impact of the change in quanti-tative easing last year shows that investment strategies can change overnight. Also note that, in the Philippines, the share of foreign trading in 2010 was only about 38 percent to total trade; this year, it is about 60 percent. Nonethe-less, the good fundamentals of the Philippine economy should remain as the base for investment decisions. They should help shield the markets from se-vere shakedowns once global asset managers review their portfolio holdings. It will be also critical to further move up from the current investment-grade status to a higher one. Thus, the current fundamentals have to be improved further, since fundamentals and good credit ratings will most likely remain as the rational bases for long-term investment decisions.

Finally, participants in the market, particularly new ones, should have a clear global and regional understanding of investments. Asean integration next year will also pave the way for an Asean exchange, further opening up the markets to more investors and more companies as options beyond the Philippines. The Filipino investor, therefore, will need to increase his or her knowledge and understanding of the global market, in which he or she is now participating.

n n n

FOR more of our views on and forecasts for the Philippine economy and the financial markets in 2015 and beyond, we would like to invite you to attend the Eagle Watch Economic Briefing at the Justitia Room of the Ateneo Rock-well Campus in Makati City, from 9 to 11:30 a.m. on January 22, 2015. For inquiries, call (632) 263-3221 or send an e-mail to info@ifpmphilippines.org.

Alvin P. Ang, PhD, is a professor of economics at the Ateneo de Manila Univer-sity and a senior fellow of Eagle Watch, the university’s macroeconomic research and forecasting unit.

THIS is regarding the article titled “Neda Region 1 exec: Slow project approval threatens Ilocos MDGs”, written by Ms. Cai U. Ordinario and published in Page A4 of the November 22, 2014, issue of the BusinessMirror.

The report is based on the recent

media briefing held in the region by the National Economic and De-velopment Authority (Neda)-De-velopment Information Staff. In the briefing, Ms. Lily Grace Orcino and Ms. Caroline Castro of Neda Regional Office (RO) 1 served as resource persons.

While we would like to thank you for your participation and for coming up with an article on the briefing, we, however, would like to make some clarifications:

1. The headline is a statement made not by any Neda Region 1 ex-ecutive or Neda staff member, but by the writer. The slow approval of the projects contained in the Stra-tegic Investment Program (SIP) is not directly related to the low at-tainment rate of the Millennium Development Goals (MDGs), as what the headline implies.

2. The region’s SIP 2014 to 2016 contains 76 big-ticket projects, with a proposed budgetary requirement of about P72 billion. This is contrary to what was stated in paragraph 3 of the report.

3. Paragraph 4 stated the explana-tion of Miss Castro on the trend of project approval in the region. How-ever, the statement was made based on the context that projects requiring high investment costs have to pass through the careful scrutiny of the Investment Coordinating Commit-tee prior to the approval of the Neda Board, which is led by no less than President Aquino. Unfortunately, this was not mentioned by the writer.

4. Paragraph 12 indicated that about 54 percent of the indicators of the MDGs have a low probability of being met by 2015; this was the writer’s enunciation. Hence, this can-

not be a premise of paragraph 13. The presenter merely showed the status of the MDG indicators as of July 3, 2013, when 46 percent of these have a high or medium probability of meeting the MDG targets.

5. Paragraph 14 stated that data showing indicators having a me-dium probability are lowering the poverty threshold, among others. The indicator mentioned in the PowerPoint presentation is below the poverty threshold. The indicator means lowering the number of persons living below the poverty threshold or line. This holds true in the succeeding paragraph.

Nestor G. RillonDirector

National Economic and Development Authority

Regional Office 1

Neda RO 1 director clarifies details in ‘Ilocos MDGs’ report

Year-to-date Third-quarter Standard & Poor’s stock-market return 2014 GDP credit ratingMajor economies United States +10.3% 2.4% Germany +4% 1.2% Japan +10.7% -1.2% Emerging economies

Indonesia +23.2% 5% BB+

(noninvestment grade)Philippines +27.6% 5.3% BBBThailand +26.6% 0.6% BBB+Brazil +0.2% -0.9% BBBRussia +9.6% 0.7% BBB-India +36.3% 5.7% BBB-China +30.7% 7.3% AA-

Source: Bloomberg, Economist, Trading Economies

Please e-mail your letters to the editor to opinion@businessmirror.com.ph. Letters chosen for publication in this sec-tion are edited for brevity and clarity.

MAIL

The total value of construction proj-ects nationwide grew 97.1 percent in the third quarter, according to

the Philippine Statistics Authority (PSA).  Data show that the total value of con-struction projects in the third quarter reached P140.7 billion, from only P71.4

billion recorded during the third quarter of 2013. however, the bulk of the total construction value in the third quarter was concentrated in only five regions—Metro Manila or the National Capital Region, Calabarzon, Central Visayas, Central Lu-zon and Western Visayas. 

“Across the country, combined con-struction value of the top 5 regions es-timated at P126.7 billion comprised 90 percent of the total,” the PSA said.  In terms of type of construction, the value of residential building construction grew the fastest at 198 percent to P88.5

billion in 2014, from P29.7 billion regis-tered in the third quarter of 2013. The construction value of additions to existing structures grew 192.1 percent to P2.6 billion, from P0.9 billion during the third quarter of 2013.

By Cai U. Ordinario

The affordability of smartphones and the availability of about 50 brands in the Philip-pines has made mobile Internet services more

accessible to Filipinos. Based on Nielsen’s evolving Digital Consumer report, smartphone ownership is now equal to 34 percent of the population, or more than double the ownership registered in 2013. The affordability of smartphones has allowed brands to tap into the younger market of between 16 and 24 year olds. This bracket continues to own the largest chunk of smartphone ownership at 39 percent in 2014, higher than the 33 percent recorded last year. “In the Philippines there are about 50 brands available in the market due to the penetration of manufacturers from China and India, as well as the growing number of local brands,” Nielsen Philippines Consumer Insights and Technology Industry Practice executive Director Carlo Santos said. “The accessibility and affordability of mobile devices give more options for the consumers, including the younger set,” Santos added. Data show that three out of four Filipino smart-phone users access the Internet through their hand-held devices. Filipinos who access the Internet through their mo-bile devices spend 174 minutes, or almost three hours, of their day on various mobile Internet applications and activities. Filipino smartphone users said they spend 78 minutes, or over an hour, on entertainment; 56 minutes a day on applications; and 40 minutes a day on communications. Nielsen said Google Play Store is the app with the largest overall reach of 90 percent. Filipinos spend an average of two minutes per smartphone user.

  At the 12th Citi Micro Awards, BSP Governor Amando M. Tetangco Jr. said microfinance has grown robustly in the last four years and has proven a viable proposition for banks. he cited latest data showing loans intended for so-called microentrepre-neurs aggregated P9.3 billion as of end-June this year. “In fact, we can say that microfinance,

as a medium for financial inclusion, has strengthened the institutional stability of banks by generating reliable business opportunities,” Tetangco said. This was particularly true for rural banks, as Tetangco reported that the return on equity of rural banks with microfinance operations was higher by 3 percentage points compared to that posted by the entire rural banking

Continued on A2 See “Construction,” A2

A8

2ndFront PageBusinessMirror

www.businessmirror.com.phFriday, December 5, 2014

‘Microfinance a big boostto SMEs, banks’ stability’

By Bianca Cuaresma

Microfinance activities have boosted the local banks’ operations and profi-tability in the country, more so for the

rural banks, the Bangko Sentral ng Pilipinas (BSP) said on Thursday.

2014 LIKELY TO BE HOTTEST YEAR EVER–U.N.The United Nations’s (UN)

top meteorologist warned on Wednesday that 2014 is

on track to be the hottest year on record and placed the blame on the continued increase in green-house gases. “There is no pause, there is no hiatus in global warming,” said Michel Jarraud, secretary-general of the World Meteoro-logical Organization. A French scientist, Jarraud, 62, noted that in the last four decades, “every decade has been warmer than the preceding decade.” Jarraud made his remarks as negotiators from rich and devel-oping countries were meeting in Lima, Peru, to try to draft an ac-cord to curb carbon-emissions lev-els. The agreement is scheduled to be signed at a summit to be held in Paris in late 2015, though a previ-ous effort at a global accord failed in 2009. expectations have been given a boost, however, because of an agreement by President Barack Obama and his Chinese counter-part, Xi Jinping, under which both

pledged to cut carbon emissions. In a provisional report on the “Status of the Global Climate in 2014,” released in Geneva and in Lima, the World Meteorological Organization (WhO) said earth’s average air temperature for the first 10 months of 2014 was 1.03 degrees Fahrenheit, warmer than the average of 57.2°F measured from 1961 to 1990. The analysis said that if that trend holds in November and December, “then 2014 will likely be the hottest on record, ahead of 2010, 2005 and 1998.” Jarraud said the provisional finding indicates “that 14 of the 15 warmest years on record have occurred in the 21st century.” While Jarraud said this year’s extreme weather events “can’t 100 percent be attributed to climate change,” he called them “consis-tent with what we expect from climate change.” Among the events the WhO identified as possibly due to climate change: ■ Above-average temperatures

in South America, particularly in southern Brazil and northern Argentina, where October’s tem-peratures were the second highest on record. ■ Cooler-than-average tem-peratures in the first 10 months of the year in the United States and Canada. In seven US states, the period was the coldest on re-cord. Persistent cold during the winter led to 91 percent of the Great Lakes being frozen at the beginning of March, the second- largest ice cover since records began in 1973. ■ At the same time, eight states in the West recorded some of their warmest tem-peratures ever, with Califor-nia recording its hottest ever January-to-October period. ■ Drought conditions contin-ued in California, Nevada and Texas, where rainfall was 40 percent less than the average recorded from 1961 to 1990. ■ Last winter was the wettest on record in the United Kingdom since 1766. MCT

Affordability, variety driving up ownershipof smartphones in PHL

December 16 and 17. Private economists viewed the latest report as generally up-beat about economic prospects. Jennifer Lee, senior economist at BMO Capital Markets, said she found it encouraging that there was enough activity in hiring and business investment that the Fed saw the need to add a section to the report detailing developments in these areas. Analysts said the views on eco-nomic performance suggest the Fed will leave a key short-term interest rate at a record low for the time being. The rate has been near zero since December 2008. Many private economists believe that the economy will be growing strongly enough and unemployment will be low enough that the central bank will begin raising rates in the middle of 2015. Much of the optimism reflected

reports of solid consumer spend-ing, which the Fed said reflected in part the fact that gasoline prices have fallen, giving house-holds more money to spend on other items. In addition, an early cold spell in parts of the country spurred sales of winter clothing. The report said auto sales were particularly strong in the Richmond, Atlanta, Chicago and San Francisco districts, with lower gas prices boosting sales of SUVs and light trucks in the Phi ladelphia, Cleveland and Chicago districts. Manufacturing showed gains in most districts, with the au-tomotive and aerospace indus-tries continuing to be sources of strength. Steel production was up in the Cleveland, Chicago and San Francisco districts, while manu-facturers of heavy machinery in the Chicago district reported im-provements in sales of construc-tion machinery but continued

weakness in demand for farm and mining equipment. high-tech manufacturers in the Boston, Dallas and San Francisco districts reported steady growth in demand, with revenue from biotech industries increasing in the San Francisco district. home construction was mixed with only about half of the dis-tricts reporting increases in home sales. Construction of nonresi-dential projects was up in most districts, however, with office building relatively strong in large urban areas such as New York City and Philadelphia. employment gains were wide-spread across the country in Oc-tober and November, with Boston reporting increases in the soft-ware and information-technology sectors, while New York found financial firms, which suffered heavy layoffs following the 2008 financial crisis, were hiring more workers. AP

Fed: US economy kept expanding in Oct, NovContinued from A1

sector in the last four years. Likewise, the nonperforming loans of rural banks engaged in microfinance operations was lower by an average of 0.33 percentage points from the indus-try-wide average.  “This is because the microfinance in-dustry has evolved from a narrow focus on microcredit to a more holistic, sus-tainable and ‘value-adding’ provision of financial services to our target market,” Tetangco explained. In particular, Tetangco said that 69 out of the 183 banks with microcredit opera-tions manage a total of 1.7 million micro-deposit accounts. he also said 86 of the 183 banks now offer microinsurance services to their clients. Also, 26 of the banks with microcredit operations now provide electronic-banking services, including

mobile money. This program was seen by the central bank as a “more cost-ef-ficient transactional platform for both banks and clients.” “The availability, accessibility and affordability of these financial products have drawn more microentrepreneurs to do business with banks,” Tetangco said. “We have learned that developing ap-propriate products and delivery channels enable financial institutions to serve markets that were previously marginal-ized. This is a solid foundation to build on for our broader financial-inclusion program,” he added. The central bank’s financial-inclusion program was earlier recognized by the economist Intelligence Unit as the best in the region and third best in the world, with the most conducive environment for financial inclusion.

Value of construction projects up 97.1% in July-Sept