Saturday, 4 October 2008

BSP Governor inaugurates Economic and Financial Learning Center

Central Bank Governor Amando M Tetangco Jr
Speech on the Inauguration of the

Members of the Monetary Board, our partners in the financial and business communities, special guests, fellow central bankers, good afternoon.

We thank you for being here with us at the launching of the Bangko Sentral’s Economic and Financial Learning Center which includes the BSP Library as well as the Statistical and Learning Center.

This center, which we call EFLC, symbolizes Bangko Sentral’s commitment to institutionalize…and sustain.. a comprehensive financial education program for Filipinos -- our primary stakeholders.

We believe that persons literate in basic economic and financial concepts… stand to benefit more from opportunities that development brings. They also become better partners in ensuring that we have a sound banking system and a more efficient transmission mechanism for our monetary policy actions. In the process, they help sustain balanced economic growth. This is the philosophy that underpins our economic and financial education program.

It is in this context that today, we are implementing a comprehensive economic and financial education program that covers children, teenagers, and adults. I will discuss its components briefly.

For Filipino children, we have Bangko Sentral’s joint program with the Department of Education and the banking community, where lessons on saving and money management are now being taught…. as part of the curriculum for 12 million public elementary pupils.

For overseas Filipinos and their dependents… here and abroad… we conduct lectures and dialogues, to help them make sound financial decisions and investments to grow their money.

For our entrepreneurial poor, we continue to preach the gospel of microfinance that has helped improve the quality of life of millions of Filipinos.

For small and medium-scale entrepreneurs, we guide them on how and where to access credit.

For banks, we teach them how to align with …and benefit from… our technological innovations such as the award-winning electronic rediscounting.

For those engaged in the remittance business, we let them know how they can benefit from using our real-time gross settlement system or PhilPass.

For bank customers, we empower them by educating them on their rights and responsibilities in dealing with banks.

For maintaining the quality of our policies, we have professorial chairs in top academic institutions to improve economic policy formulation and education.

For the general public, we conduct lectures and seminars for them to understand the role of the Bangko Sentral in the Philippine economy; we also teach them how to recognize counterfeit currency; and through the highly successful “Tulong Barya Para sa Eskwela” we teach our public the value of small things, including the barya, as the start of wealth creation.

And of course, we respond to requests for information and resource persons from schools, institutions, and civic groups.

With our EFLC, we have created a one-stop center where researchers, students, visitors, and BSP staff may access data and information produced and acquired by the Bangko Sentral in the areas of central banking, economics and finance. We have a briefing room here where we can host various visitor groups.

Incorporating today’s technology, the EFLC will provide information not only through conventional books and magazines, but also in various electronic formats such as CDs, digitized books, and interactive learning modules. EFLC will coordinate with other sectors and departments at the Bangko Sentral to consolidate materials for our economic and financial education program under this one-stop center. This will include digital archives of BSP video materials to make them accessible to the public.

Visitors may also buy Bangko Sentral publications and commemorative items here at the EFLC.

Through the interactive modes of learning, including computer-based games and multi-media learning tools, EFLC should inspire and excite visitors to learn more about economics and finance. It is possible, some of our visitors may even decide to become central bankers.

But beyond the books and multi-media resources here, we envision EFLC to serve as a regular forum for intellectual discourse that will inspire higher learning in the field of economics and finance.

Ladies and gentlemen. I am pleased to inform you that this EFLC is just the first of a series; our plan is to set up EFLC’s at Bangko Sentral’s regional offices and branches. This is to provide equal opportunity for our people in the countryside equal access to our material and resources.

Actually, work has already started in operating the regional centers but we will expand their scope and services in the form of traveling exhibits and operation of regional hubs to ensure that our electronic resources are accessible to our visitors in the regions. Expanding our network and enhancing regional facilities will ensure that timely economic and financial learning benefit those in the countryside as well.

Ladies and gentlemen. I cannot overemphasize the importance of ensuring the success and sustainability of our economic and financial education program.

If we are effective in teaching saving and money management to our 12 million public school pupils, we would be on track to raise a new generation of financially-independent Filipinos who will lift our country from its traditional deficit-spending mode.

If we are able to educate our public to recognize legitimate investment vehicles from pyramiding scams, then we can truly harness public savings to finance productive ventures.

If we are able to inspire Filipinos to save, invest more, or to become entrepreneurs, then we have done our country a great service in terms of sustaining its growth and development.

I hope therefore that we will continue to work together on our economic and financial education program.

Finally, I congratulate the EISG headed by Marah Angka and her staff for finally getting the EFLC off the ground. Let us give them our full support and cooperation.

And so, ladies and gentlemen, let us now begin our tour of the EFLC.

Mabuhay ang EFLC! Mabuhay ang Bangko Sentral ng Pilipinas!

Thank you all and enjoy the rest of the day.

Housing sector to overcome US financial crisis, says De Castro

Elaine Ramos Alanguilan
The Manila Standard
http://www.manilastandardtoday.com/?page=business4_oct4_2008

Vice President Noli de Castro is confident the financial crunch in the United States will not hamper the growth of the housing sector in the Philippines as he directed shelter agencies to be more cautious.

De Castro, who is also chairman of the Housing and Urban Coordinating Council, said the sector had learned hard lessons from its mistakes.

“The housing sector has gone through a similar crisis. In fact, we are a decade ahead of the Americans in creating a housing mess,” De Castro said in a statement.

He referred to collapse of the Unified Home Lending Program collapsed and the Asset Participation Certificates-funded projects.

He said the situation could have been averted if the proper regulatory environment was in place, or if the major financial institutions managed risk-taking in a prudent manner.

“In other words, if good governance principles were truly practiced, maybe the financial crisis at that time could have been averted,” said De Castro.

De Castro said he was confident the local housing industry would not fold up in the face of the US financial crisis.

“We’ve been there before and back. We know better,” said De Castro.

He said he had asked National Housing Mortgage and Finance Corp. and Home Guarantee Corp. to study the market environment closely.

The effort to monitor the market, he said, was related to the agencies’ plans to issue the first mortgage-backed securities since the recent events in the US may have an impact on the undertaking.

De Castro said the two agencies also had to review the housing policies to find out if there were loopholes that could lead to financial problems in the future.

RP eyeing $2-b revenues from medical tourism mart

By Elaine Ramos Alanguilan
The Manila Standard
http://www.manilastandardtoday.com/?page=business3_oct4_2008

The Philippine tourism and wellness sector is projected to generate revenues of $2 billion in two to four years as it strives to corner a slice of the multi-billion dollar global medical tourism market.

“The $2 billion in potential revenues is putting it mildly. However, the pace with which the industry can hit that revenue level depends on how everybody else helps us. The $2 billion should be hit in two to four years,” Tourism Undersecretary Cynthia Carreon told reporters yesterday.

She said the country stood to gain from the increasing global demand for affordable health-care and wellness.

“The whole world is facing a crisis in health. Health care in the United States costs a lot of money and so people are looking for places where they can avail of the same services for a fraction of the cost,” Carreon said at the sidelines of the press launch of the Philippine Health and Wellness Summit at the Sofitel Philippine Plaza.

She said about 50 million did not have health insurance coverage in the United States alone, providing a huge potential market for the local tourism industry, especially the health and wellness sector.

The costs of health care in other countries are also high with a substantial number of the population unable to afford it.

Customs collections surge 26% to P23.99b

By Lawrence Agcaoili
The Manila Standard
http://www.manilastandardtoday.com/?page=business2_oct4_2008

The Bureau of Customs exceeded its monthly collection goal for the sixth straight month after its revenue take jumped close to 26 percent in September due to the weak peso and higher oil prices.

Preliminary data from Customs showed that the agency’s tax take amounted to P23.99 billion in September, up P4.93 billion from P19.06 billion year-on-year.

The September collections were also P1.44 billion higher than the P22.55-billion target for the month of September.

Customs has consistently exceeded its collection targets since April due to higher oil prices, the weak peso increased rice imports by the state-run National Food Authority and other measures.

Customs collections in the first nine months of the year rose 25.2 percent to P191.45 billion from P152.96 billion in the same period last year.

The agency’s revenue take from January to September was P6.23 billion higher than the P185.22-billion collection goal for the period.

The agency’s cash collections, however, amounted to P161.87 billion in the first nine months of the year, or P17.7 billion lower than the target of P179.58 billion target for the period.

But non-cash collections hit P29.58 billion, or P23.93 billion more than the target of P5.64 billion due to increased tax expenditure funds extended to NFA to cover more rice importations.

The inter-agency Development Budget Coordination Committee originally expected oil prices to range between $62 and $70 billion per barrel. It revised the assumption to a range of $115 to $125 per barrel after the price of oil peaked to $147 per barrel.

Meanwhile, data from the Bangko Sentral ng Pilipinas showed that the peso depreciated to 46.917 to $1 in end-September from the end-January level of 40.65 to $1.

Analysis conducted by the Finance Department showed that collections increased by P1 billion for every $1 per barrel increase in the price of oil in the world market and by P2.5 billion for every P1 depreciation versus the greenback.

BoC is tasked to collect P254 billion this year or 21.3 percent higher than last year’s P209.4 billion.

Gov’t pay hike assured despite crisis

P20 B allocated in first of 4 annual tranches
Gov’t pay hike assured despite crisis – Andaya


Edmer F. Panesa
The Manila Bulletin
http://www.mb.com.ph/MAIN20081004137002.html

Budget Secretary Rolando Andaya Jr. assured yesterday that the first installment of the government’s four-year pay hike program for some 1.141 million state workers will push through next year despite the global financial crisis and budget cut threats.

Interviewed at the sidelines of the plenary deliberation on the 2009 national budget proposal at the House of Representatives, Secretary Andaya said government employees must be given a pay raise to enable them to cope with rising prices and high cost of living.

"We will push through with the pay hike for state workers not only because it’s already programmed in the 2009 budget but also because they really need it," Andaya said.

The Department of Budget and Management (DBM) has allocated P20 billion to fund the first tranche of the new Salary Standardization Law in 2009 covering some 1.141-million strong government employees, including uniformed personnel.

To fully implement the four-year program, it will cost the government around P109 billion. Since this is too big an amount to be given in one tranche, the government decided to grant it in four "gives" from 2009 to 2012.

The first installment amounting to P20 billion will be released on the first year. This amount is included in the proposed P1.415-trillion national budget for 2009.

Andaya had earlier said the idea behind the staggered payment is to let revenues grow alongside expenses. "As more money go into public coffers, more will be put inside pay envelopes. In short the pay hike will be commensurate with the hike in the tax effort," he said.

Among those who will benefit from the four-year pay hike program for state workers are public school teachers, who at more than 522,000, account for almost half of the government workforce.

Andaya said the government is raising the Salary Grade (SG) of teachers by one notch, to SG 11, which would entitle them to a basic pay of between P18,088 and P19,527. This would mean a 50 percent increase when fully given.

At present, an ordinary public teacher receives a monthly salary of P12, 026 a month. His or her salary will increase to R14,083 once the first installment of the pay hike takes effect next year.

The DBM chief also assured that the P20 billion allotted for the pay hike of government employees will not be affected by the proposal of the opposition to cut the 2009 budget by R100 billion to R200 billion.

Also yesterday, House Minority Leader Rep. Ronaldo Zamora of San Juan City warned that the government may not be able to afford a P1.415-trillion 2009 budget, which is 15.3 percent higher than the 2008 national budget of P1.227 trillion, considering the revised macro-economic assumptions in the face of the US financial crisis.

"Our figures will show that there will be 100 or possibly 200 billion pesos that we could cut away and then come up with a still responsible budget that addresses the requirements of more infrastructures, which is coincidentally less pork, less fat on the body of the budget," Zamora said.

The leader of the House opposition bloc said lumpsum allocations such as travel expenses of various government agencies and the so-called "presidential pork" could be reduced.

He cited the P470-million travel expenses for the Department of Agrarian Reform and President Arroyo’s P650-million intelligence fund.

Zamora, however, said he would not propose cuts in the P70 million in pork barrel funds for each congressman and the P200 million for each senator. "Mahirap nang pakialaman ang pork ng mga solons. Mawawalan kami ng suporta," Zamora said.

Friday, 3 October 2008

Dubai-based Jebel Ali to invest $400 M in Subic Freeport

By Ma. Elisa P. Osorio
The Philippine Star
http://www.philstar.com/index.php?Business&p=49&type=2&sec=27&aid=2008100268

Dubai-based Jebel Ali Free Zone (Jafza) will invest up to $400 million in a logistics project in Subic Bay freeport Subic Bay Metropolitan Authority (SBMA) administrator Armand C. Arreza said yesterday.

Jafza is Dubai World’s sister company.

Arreza said the freeport attracted a number of investors during the first eight months of this year, generating $200 million or P9 billion worth of committed investments.

“We were able to attract investments mainly in manufacturing and tourism,” Arreza noted.

Aside from the logistics center, Jafza is likewise planning to build one of the two Information Technology (IT) parks in Subic.

The investment for the IT park is estimated to be around $40 million. The other firm which might build the IT park is Century Development Corp..

“The big investments will come when firms start locating within the software parks,” Arreza explained.

Arreza said the infrastructure for the IT parks is expected to be completed in two years. The parks will be built in a 19-hectare land. For the construction of the building alone, he said the investment could be as much as $1 million per hectare.

Upon completion, Arreza said the two IT parks will provide 12,000 to 15,000 new jobs in Subic.

In terms of revenue, the new IT Parks can bring in as much as $30,000 per call center seat annually.

The administrator said they are currently courting two US-based call centers to set up shop in Subic. He said the two firms are expected to set up between 6,000 to 10,000 seats.

Arreza refused to name which call center firms they are negotiating with but said these call centers are already present in the country.

15 DPWH officials, employees dismissed over misconduct

By Edu Punay
The Philippine Star
http://www.philstar.com/index.php?Headlines&p=49&type=2&sec=24&aid=20081002148

Fifteen officials and employees of the Department of Public Works and Highways (DPWH) were dismissed from the service after the Office of the Ombudsman found them guilty of administrative misconduct.

Overall Deputy Ombudsman Orlando Casimiro, who issued the six separate dismissal orders, ordered Public Works Secretary Hermogenes Ebdane Jr. to immediately implement the orders and submit a compliance report.

In the first case, Rudy Canastillo, former assistant regional director; Edward Canastillo, former acting district office head; Cecil Caligan, former acting district office assistant head, all of the DPWH office in Iloilo, were found guilty of grave misconduct for conspiring to give “unwarranted benefit, advantage or preference” to one Rogelio Yap, the contractor for the Bancal-Leon-Camandag Road in Leon, Iloilo in 2002.

Investigation showed that they connived to make it appear that P6,733,329.23 was used for the excavation phase of the project, which only actually cost P38,610.

Then DPWH Iloilo regional director Wilfredo Agustino was also ordered dismissed in connection with the case.

However, he had already retired in 2004 so the Office of the Ombudsman imposed on him the accessory penalties inherent to dismissal, including cancellation of eligibility, forfeiture of retirement benefits, disqualification for reinstatement or reemployment and barred him from taking any Civil Service examination.

In the second case, the anti-graft agency dismissed Rolindo Perez, officer-in-charge and district engineer; Vicente Vargas, assistant district engineer; Dennis Geduspan and Mayo Pelagio, both engineers; Bernardo Yparosa, accountant; Jose Javier, Jr., property custodian; and Pio Gareza Jr., supply officer – all of the 4th Sub-Engineering Office of the DPWH office in Bago, Negros Occidental.

All seven were found guilty of grave misconduct in connection with irregularities in two projects for the improvement of the Camingawan-Pandan Road in Pontevedra.

A special audit of the projects revealed a discrepancy of P8,128,768.37, representing cost of materials and labor paid but not delivered or accomplished.

In addition, there was a discrepancy of P2,968,268.33 representing cost of materials and labor utilized or applied in the project, but which were not included among the paid items.

The third case involves dishonesty and grave misconduct on the part of Miviluz Aviles, chief of the Systems and Procedures Division; and Leticia Osorio, chief of the Medical-Dental Division of DPWH-Manila.

The two officials were found to have incurred a three-month absence from work without filing the necessary leave of absence or authority to travel abroad.

To cover up the irregularity, Osorio issued to Aviles a medical certificate to make it appear that she was sick and rightfully on sick leave, although records show that Aviles was actually in Hong Kong.

The other cases were against Geronima Muncada, cashier; and Azucena Viojan, supply officer, both of the DPWH office in Samar; and Abdulmunib Muksan, in-charge of the DPWH regional office in Leyte.

Muncada was ordered dismissed for dishonesty after incurring a shortage of P4,586,839.35 in her accounts, consisting of unliquidated cash advances and checks issued without disbursement vouchers and supporting documents.

Investigation revealed that Muncada altered the names of the real payees and replaced them with her own for presenting to the banks, and altered them again for the purpose of reporting the checks as disbursements.

Viojan was dismissed for gross neglect of duty and simple misconduct after she signed twenty checks amounting to P1,371,852.75 even if these were not duly supported by the necessary documents.

Moreover, she was found to have received payment for a check worth P94,967.50, which was issued to another person.

Muksan, an employee of the DPWH-Central Office and assigned as in-charge of the President’s Bridge Program Depot in Palo, Leyte, was dismissed for dishonesty in connection with the alleged theft of 176 government-owned steel bars worth P440,000.

Investigation revealed that Muksan hired two laborers to haul and deliver the steel bars to the junkyard of one Bienvenido Sta. Iglesia in Ormoc City, to be sold as scrap materials, without authority of the DPWH.

‘Economic prospects now better for RP’

Infra spending upped by 20% to P230B in 2009, agriculture by 56%
By Marvin Sy
With Paolo Romero
http://www.philstar.com/index.php?Headlines&p=49&type=2&sec=24&aid=20081002136

The Philippines has better prospects for survival with the US Senate’s resounding approval of a sweetened $700-billion Wall Street rescue plan, the Arroyo administration’s economic managers said yesterday.

“There will be a happy Christmas and a merry new year,” Socioeconomic Planning Secretary Ralph Recto said at a press conference in Malacañang.

But he said the lower growth figures for this year and in 2009 will remain despite the good news from the US.

Bangko Sentral ng Pilipinas (BSP) Deputy Governor Nestor Espenilla said the approval of the bailout would lessen the fallout of the global economic crunch on the Philippines and other developing countries.

“This (bailout approval) is going to be a positive factor in limiting fallout as a result of continuing financial turmoil in the US,” Espenilla said in the same news briefing.

Espenilla said the local banks are “strong in their own right and we have no problem down the road.”

“The bailout will improve chances of recession not taking place. It does not mean it’s no longer there, but we are talking of probability,” Finance Secretary Margarito Teves said.

“Slowdown will allow business to take place but in recession, there is contraction and people will be adversely affected, emerging economies will be adversely affected,” Teves said.

“In a slowdown, my neighbor is out of a job, but if it’s recession, I get unemployed, so we have to avoid recession at all costs,” he said.

“We need your help to communicate to the public what is happening. We are focusing on medium case scenario, which we are all prepared for,” he said at the briefing.

Recto said the Philippines’ macroeconomic fundamentals are better than those of the US itself “as far as the country’s debt-to-Gross Domestic Product ratio is concerned.”

The US has a negative savings rate while the Philippines has a positive savings rate, he said.

“Our foreign debt is going down. We can finance our own development. In the medium term, we are in a better position,” Recto said.

“To cope with crisis, we will continue to improve debt-to-GDP ratio. We have brighter growth prospects ahead,” he said.

He said the country remains on track to meet the United Nations’ Millennium Development Goals of reducing poverty incidence by half by 2015.

He said the government has downscaled its GDP targets to 4.4 percent to 4.9 percent this year and to 4.1 to 5.1 percent next year, which he described as “more realistic, credible, transparent.”

“It’s good to be conservative. If we could go faster, the better,” Recto said. “As part of the mandate of risk management and risk aversion, it’s better to be credible,” he said.

“There is a need to downscale targets this year. We feel there will be a slowdown in US, where they already lost about 800,000 jobs in the past several months,” he pointed out.

Budget Secretary Rolando Andaya Jr., for his part, said there was no need to revise the proposed P1.4-trillion national budget as it was designed to help the country survive a global economic slowdown.

“The solution is spending,” he said.

He said infrastructure spending will increase by 20 percent next year, and agriculture by a whopping 56 percent.

He said for infrastructure alone, the government has a public sector “infrastructure war chest” of P230 billion next year. Of this amount, P147.5 billion will be spent by the national government, P32.1 billion by government-owned and controlled corporations, and P50 billion by local governments.

The national government’s 2009 infrastructure budget is 20.7 percent higher than this year’s P122.2 billion.

“The budget is funneled to a verifiable spending menu called HEARTS, for Health, Education, Agriculture, Roads, Technology and Tourism, Shelter and Security,” he said.

“The challenge is to have these agencies spend the money they have in the first few months. There had been flat growth in infrastructure spending… but in June, July, August we had an increase so we just had to keep it up,” Andaya said.

Recto said exports would be hit as the US accounts for 17 percent of the country’s exports.

“What the government can do is help the private sector by building infrastructure, by helping them open up markets such as China,” Recto said.

Recto pointed out that the US used to take up 35 percent of the country’s total exports.

The Arroyo administration has emphasized the need to increase trade with China, which is one of the fastest growing economies in the world and is very close to the Philippines geographically.

Apart from exports, Recto noted that tourism is another sector that has huge potential for growth, particularly from markets such as China.

“To me the real key is government spending in infrastructure, in agriculture to temper inflation,” Recto said.

“So the challenge is to reduce inflation and spend for sustainable growth in the future and that’s where the importance of infrastructure and increasing agricultural productivity come in,” Recto said.

GIR safe


BSP’s Espenilla, meanwhile, said that the country’s gross international reserves (GIR) are safe since the country’s financial institutions do not have the same solvency problems as those in the US and some parts of Europe.

“The BSP has followed an extremely conservative policy with respect to the management of the reserves, wherein safety of principal is the primary and overriding consideration. So you should have no concern over that issue,” Espenilla said.

As of end-August, the BSP reported that GIR was at $36.7 billion.

In the US and in some European nations, governments had to shell out billions to bail out troubled financial institutions.

“In the Philippines this is not the issue we have to deal with, simply because our banks have no solvency issues at this time,” he said. “We went through it in 1997. We have learned our lessons and prepared for it so in this instance we’re quite ready for it,” Espenilla said.

“If you ask about liquidity, the BSP has always had its regular facilities wherein basically it provides liquidity loans to various financial institutions on market terms and on collateralized basis,” he said. “These windows are available and continue to be available for whatever necessity.”

Mindanao is focus of US for Southeast Asia peace and stability

By RODNEY JALECO, ABS-CBN North America News Bureau | 10/02/2008 1:03 PM
http://www.abs-cbnnews.com/nation/10/02/08/mindanao-focus-us-southeast-asia-peace-and-stability

WASHINGTON D.C. - The eyes of the United States are increasingly focused on Muslim Mindanao which could be a vital cog to America’s ability to build on the peace and stability of the Southeast Asian region.

“Recent developments have highlighted the difficulty and importance of achieving a lasting peace in Mindanao,” Scot Marciel, America’s top envoy to the Southeast Asian region told a forum here last week.

Marciel is Deputy Assistant Secretary for East Asian and Pacific Affairs. He is also US Ambassador to the Association of Southeast Asian Nations (ASEAN). His remarks were given before a conference of the Center for Strategic International Studies that explored US-Southeast Asia relations.

“The ASEAN region is of crucial importance to the United States,” he stressed.

He said the US has two primary interests in the region – for Southeast Asian nations to remain strong, stable, free and prosperous; and for them to remain “good partners” in regional and global issues ranging from addressing climate change to containing the threat of weapons of mass destruction (WMD).

He cited ASEAN’s role in convincing Burma’s junta to accept much-needed international aid after a devastating cyclone and the contribution of various Southeast Asian countries, including the Philippines, to peacekeeping operations around the world.

US economic and military assistance to Southeast Asia grew from $534 million in 2007 to $668 million this year. ASEAN groups original members Thailand, Malaysia, Indonesia, Singapore, Brunei and the Philippines, and additions Burma, Vietnam, Laos, Cambodia. They have a combined population of over 575 million and Gross Domestic Product (GDP) of more than $3.4 trillion.

Focus on terrorism and trans-border militant threats

Marciel points out the Philippines and Thailand are the only two Southeast Asian countries that have mutual defense pacts with the US.

“The Philippines,” Marciel noted, “has improved its economic performance and made substantial progress fighting terrorists who threaten it.”

“The US has supported this counter-terror work but first and foremost this is a Philippine effort,” he stressed.

“The southern Philippines currently constitutes a main focus of US concern regarding terrorism and trans-border militant threats, with American diplomats darkly referring to the region as the ‘new Afghanistan’,” Dr. Peter Chalk wrote in the “CTC Sentinel” – a publication of the Combating Terrorism Center based at the US Military Academy in West Point, New York.

With an area of nearly 95,000 square kilometers, it is bigger than the Netherlands, Ireland or neighboring Taiwan. But US attention is concentrated on the island’s western provinces, particularly the Autonomous Region for Muslim Mindanao (ARMM). Sulu, Basilan and parts of Central Mindanao have been cradles of Islamic extremism in the country.

“The thrust of foreign military assistance to Manila has been directed toward vitiating the operational tempo of the Abu Sayyaf Group – an effort that has met with some relatively significant results,” Dr. Chalk averred.

“The US clearly views the ASG as posing a direct threat to a highly important ally in Southeast Asia,” he said.

However, he also suggested there may be higher strategic stakes for the US. The Arroyo administration, he said, “constitutes one of the most ardent supporters of President Bush’s global war on terrorism that…remains crucial to legitimating US basing options in the wider Asia-Pacific.”

After the Philippine Senate voted to boot out US military bases in the country, the prolonged deployment of American forces has become a contentious issue especially among militant groups.

There are reportedly less than a thousand US troops – about a third of them from the Florida-based Special Operations Command – spread out in Mindanao, Sulu and Basilan. They have built their own facilities at Camp Navarro, headquarters of the Western Mindanao Command of the Armed Forces of the Philippines (AFP); and the Philippine Marines headquarters at Camp Bautista in Jolo, Sulu.

Although the Philippine Constitution bars them from engaging in direct combat, reports indicate they do move as a unit or in company of Filipino troops in conflict areas.

“The emergence of a concerted jihadist beachhead in Mindanao would not only negatively impact the general stability of the Philippines and its neighbors, but it would place under pressure existing bilateral and multilateral relations that are emerging as a key component of Washington’s post 9-11 national and international security strategy,” Dr. Chalk wrote on the CTC Sentinel.

“Soft power” vs extremist threat

The recent collapse of the peace process with the Moro Islamic Liberation Front (MILF) is a cause for concern.

“We are not serving as intermediaries or getting into details,” Ambassador Marciel declared, “that’s for the Philippines to do, but we are doing what we can to encourage both sides to reach an agreement that can make a big difference for the future of the country.”

The US has been funneling much of its aid to the Philippines to the strife-torn areas of Mindanao. Starting in 2005, 60 percent of US Development Assistance (DA) and Economic Support Funding (ESF) have gone to Mindanao, initially to build on the peace generated by the peace pact with the Moro National Liberation Front (MNLF). The US was reportedly poised to extend the same level of assistance for the MILF had a final peace accord been signed in Kuala Lampur this year.

Dr. Chalk pointed to the increasing use of “soft power” that can address the challenges of poverty and unemployment in Mindanao conflict areas.

Development Assistance to the Philippines is projected to grow from about $15.5 million in 2007 to nearly $57 million by next year. Money for Child Survival and Health (CSH) programs is projected to add another $20 million.

In contrast, the State Department requests for the Philippine military have been declining. It sought only $11.1 million in Foreign Military Financing (FMF) this year until the US Congress came to the Philippine military’s rescue and voted to maintain the 2007 level of military aid, allocating $29.6 million in FMF this year.

But for 2009, the State Department is seeking just $15 million in FMF for the Armed Forces of the Philippines (AFP). Total State Department requests for assistance to the Philippines is $99.2 million for 2009.

Human rights, freedom imperatives

Congress wrote a condition for the AFP to get the last $2 million in its FMF allocation to a State Department certification that it had complied with United Nations recommendations against extra-judicial killings and the assurance US military aid is not used against President Arroyo’s political opponents.

In March 2007, the Senate foreign relations committee held a historic hearing, listening to the testimony of Filipino religious and human rights activists. They told the panel, chaired by California Senator Barbara Boxer, that more than 800 religious, lay people, journalists, labor leaders and peasant organizers have been killed under a “culture of impunity”, allegedly by members of the Philippine military and police.

AFP officials have denied the allegations and emphasized the military no policy of targeting civilians.

The Filipino delegation sought to tie US military aid to the Arroyo’s administration adherence to human rights.

“One constant, whether talking old issues or new, bilateral or regional, has been our work in Asia to support freedom and human rights,” Ambassador Marciel said.

“Issues of liberty and democracy are part of our engagement in the region. Sometimes other countries are not thrilled by this, but most understand it is part of who we are,” he stressed.

America’s chief envoy to ASEAN adds, “I sense a growing demand for human rights and democracy in the region, and countries responding to it. The US tries to play a supporting role.”

Dr. Chalk noted that a large chunk of US military aid goes to support the Philippine Defense Reform (PDR) agenda. “There are signs defense reform within the AFP is being institutionalized and taking on the type of self-sustaining character.”

He said the AFP’s “honorable warrior” initiative is showing signs of “inculcating an ethos of military professionalism”.

“This innovative program singles out members of the armed forces deployed in Mindanao who have served with distinction and who have been active in promoting action against human rights abuses, graft, embezzlement and other questionable practices,” Dr. Chalk wrote.

“We have a good story to tell,” stressed Ambassador Marciel.

“The form of our engagement sometimes changes as new issues arise, but the strength of it does not. We are very committed to the region, and we see great opportunities. We plan to be a good partner for Southeast Asia for a long time to come,” he concluded.

Ombudsman cracks whip on Customs, Revenue officials

Jomar Canlas
The Manila Times
http://www.manilatimes.net/national/2008/oct/03/yehey/metro/20081003met1.html

OMBUDSMAN Maria Merceditas Navarro-Gutierrez ordered the suspension and charging in court of Internal Revenue and Customs bureau officials who allegedly accumulated questionable wealth.

In separate rulings, the Ombudsman ordered preventively suspended for six months Felix Embalsado, Customs operations officer in Sta. Clara, Batangas; Emily de Luna Singson, Revenue officer in Calamba, Laguna and Myrna Ramirez, Revenue officer in Quezon City.

Embalsado, Singson and Ramirez have been administratively charged for violating Republic Act No. 6713, or the Code of Conduct and Ethical Standards for Public Officials and Employees, for allegedly amassing wealth grossly disproportionate to their legitimate income. They were also cited for their failure to report their acquired properties in their statement of assets and liabilities.

Embalsado, who was also charged with misconduct, acquired an impressive portfolio of prime real estate properties in Tanauan City that included three buildings and three parcels of land, as well as five high-end vehicles worth P11 million.

Singson was charged with dishonesty for amassing unexplained wealth amounting to P15 million and for violating RA 6713, because of her failure to file her annual statements of net worth from 1991 to 1995.

She also had frequent travels abroad and acquired unexplained wealth that included residential and agricultural lots worth P1.97 million. Forfeiture proceedings have been initiated for the recovery of her unlawfully acquired assets.

According to Assistant Ombudsman Mark Jalandoni, who is also the agency’s spokesperson, the Ombudsman has the authority to impose preventive suspensions on accused officials to prevent them from tampering evidence and using their position to influence the course of an investigation.

The Ombudsman also indicted before a lower court in San Pablo City Lucien Sayuno, former Regional Internal Revenue director of the city. He was charged for four counts of perjury under Article 183 of the Revised Penal Code and four counts for violating RA 6713 for deliberately making false statements under oath in his 1999 to 2002 statements of net worth. He also failed to declare his shares of stocks in two firms.

Sayuno also failed to declare in his 2002 to 2004 statements of net worth a 200-square meter lot in South Cotabato and a Toyota Revo in his 2001 statement. He also made an under evaluation of his properties in South Cotabato in his 2000 to 2004 statements of net worth
--

Economists: Population bill a waste of money

AFP and Emilia Narni J. David
BusinessWorld Online
http://www.bworldonline.com/BW100308/content.php?id=073

A BILL seeking to impose population control is a waste of valuable resources that would be better ploughed into education and infrastructure, a conservative think tank said yesterday.

The proposed law comes at a time when countries that adopted similar policies in the 1970s are reversing them as they start to worry about supporting their ageing populations, said economists at the University of Asia and the Pacific, a known Roman Catholic-backed educational institution.

Its chief economist, Bernardo M. Villegas, said controlling the population would be "demographic suicide" and will put the blame for widespread poverty with "people who are not yet even born."

The bill is about 12 votes shy of passing the House of Representatives, according to its principal author Albay Rep. Edcel C. Lagman.

However, it lacks the support of President Gloria Macapagal-Arroyo, a devout Roman Catholic who could theoretically veto it even if passed by the House and the Senate. Mr. Lagman said a dozen previous population bills over the past generation had been defeated.

The dominant Catholic church has threatened to excommunicate legislators who vote for the bill.

Under the proposed law the state would have to fund a population program, teach it at schools and to couples intending to marry and have government hospitals offer contraceptives, vasectomies and tubal ligation, an operation that blocks the fallopian tubes.

It will require the state to "encourage two children as the ideal family size."

The Philippines has among the highest birth rates in Asia, with the population growing at around 2% annually and expected to top 100 million in five years.

Mr. Villegas told reporters solving poverty that binds a third of the population required improving the quality of basic education, curbing corruption and devoting state resources to developing the countryside, where the largest concentrations of poor live.

Educating women

"The greatest impact of your peso is in educating women," said Roberto de Vera, another economist at the same school.

Mr. Villegas said international studies showed the growth of per capita income was related to school enrollment rates rather than population control.

"Countries with higher human capital also have lower fertility rates," he added.

Contrary to popular convention, he said the fertility rate of Filipino women had fallen from six children in 1975 to fewer than three.

Even without state intervention, the population will peak at 111 million in 2025, with a maximum population density of just 370 people per square kilometer, he added.

Mr. Villegas said the government should focus on improving the quality of basic education and governance and develop infrastructure in the countryside, "not just telling people to have less children."

He said House Bill 5043 can hurt the poor since they need family members to work.

The reports of Messrs. Villegas and de Vera were contradictory to the position paper of professors from the University of the Philippines School of Economics (UPSE).

The UPSE paper said high population density is one of the main causes of poverty, along with unequal wealth distribution and poor governance.

One of its recommendations is the passage of a population control legislation to give more access to basic needs such as education.

The authors of the UPSE position paper could not be reached for a comment as of press time.

Mr. de Vera claimed studies have shown that educated women are most likely to delay having a family or have fewer children.

He noted the "contraceptive mentality" has hurt other nations.

"We are seeing that countries like Singapore, Korea, Japan, France and Germany are increasingly finding it difficult to get women to have more children because getting pregnant is not enticing to them anymore," the professor added.

Jollibee completes acquisition of Beijing-based congee chain

Kristine Jane R. Liu
BusinessWorld Online
http://www.bworldonline.com/BW100308/content.php?id=041

HOMEGROWN FAST-FOOD giant Jollibee Foods Corp. has completed the purchase of a Beijing-based congee restaurant chain in China, in line with efforts to expand its presence in the populous nation.

In a disclosure, the company said the deal to buy Hong Zhuang Yuan was consummated upon approval by China’s Ministry of Commerce and after the congee restaurant’s owners complied with conditions for the sale.

The retail giant bought the Chinese food chain for P2.5 billion through its wholly owned subsidiary Jollibee Worldwide, Pte. Ltd.

"Of the amount, P1.62 billion was paid to the sellers as initial payment, and the [balance] will be paid within the next 12 months," Jollibee told the exchange.

The company said the payment for Hong Zhuang Yuan would be funded by a $100-million loan from several banks.

The Beijing restaurant has an estimated annual sales of P1.3 billion this year, and operates a total of 38 restaurants, 31 of which are company-owned.

The company first disclosed its plan to acquire Hong Zhuang Yuan in September last year. Jollibee President and Chief Executive Officer Tony Tan Caktiong said the congee restaurant would be a strong addition to their presence in China in terms of market segment and geographical coverage.

Jollibee operates the largest restaurant network in the country, operating a total of 1,480 stores — 636 Jollibee branches, 377 Chowking stores, 231 Greenwich outlets, 204 Red Ribbon stores, 27 Delifrance branches and five Manong Pepe outlets.

The group also operates 223 stores and has bought a number of restaurants abroad, particularly in Taiwan and China.

Aside from Hong Zhuang Yuan, Jollibee has acquired three Chinese restaurants to gain a foothold in the huge consumer market.

It bought 70% of Taipei restaurant Lao Dong in June and Chun Shui Tang tea house in 2006. In 2004, Jollibee bought Chinese fast-food chain Yonghe King for $22.5 million.

In July, the company entered into a joint venture deal with US-based Chow Fun Holdings LLC, where Jollibee will have a 12% stake in the US-based Asian restaurant for $950,000.

The fast-food giant has been hit by rising commodity prices, posting an 18.7% drop in its net profit to P645 million in the second quarter.

Shares of the company yesterday lost 1% or 50 centavos to P49.50.

DoT travel fairs win 3 gold prizes

The Manila Bulletin
http://www.mb.com.ph/BSNS20081003136914.html

Tourism Secretary Ace Durano anticipated increased tourist arrivals in the last quarter this year after winning three gold prizes in a row from travel fairs in Korea, Vietnam and Spain.

"The Philippines can anticipate increased arrivals in the coming months, because of the major exposure and recognition we have received from our recent participations in world-renowned events. Indeed we have heightened our efforts to reach the international market," Durano said.

The Philippines won three gold prizes in a row from travel fairs held in Korea and Vietnam, and the prestigious Expo Zaragoza in Spain highlighting the beauty and wonder of the country’s 7,107 islands.

"Filipino creativity has always received world recognition, and this is a testament of the continuing strengthened efforts from all marketing teams to promote the diverse travel destinations that are present in the Philippines," Undersecretary for Tourism Planning and Promotions Eduardo Jarque, Jr. said.

Captivating themes, a focus on diverse destinations, and ingenious concepts continue to be strong points for the Philippines’ participation in travel fairs globally.

‘7,107 islands more than the usual,’ was the highlight of the Philippine booth at the Busan International Travel Fair (BITF), which won two grand prizes, Best Booth Design and Best Folkloric Performance.

Product diversification coupled with strong linkages with travel agents and airlines, as well as media support in the market made the DOT’s promotional efforts widely received by the outbound travelers in Korea.

Korea still has the largest share of arrivals, with 20% total share. The Philippines as a venue to learn English remains to be a very well acknowledged position in the Korean market. The current efforts to expose the country continue to capture a larger share of the growing outbound student sector.

In Vietnam, the Philippines had the honor of being the Guest Country in Vietnam, with ‘diversified travels’ as the main focus.

Jarque pointed out that "tourists from different countries and cultures look forward to different ways of relaxation. The Philippines can readily respond to these diversified needs, with our natural wonders."

With combined efforts in design, performance, and participation, the Philippine booth was awarded the Best Booth Design, National Pavilion category.

Tourism attaché Ms. Gerosel Siquian believes that "our unique booth concept really stood out from the rest, and attracted the attention of the participants in the travel fair."

She added that "access to the Philippines also contributed to the interest of Vietnam tourists. The increased number of flights between the country and Vietnam will boost positive tourism growth and cooperation."

Data in the first semester of the year showed Vietnam as having the largest growth rate amongst ASEAN countries.

Cebu Pacific’s entry into Vietnam at the beginning of the year stimulated more direct air connections between Hanoi, Ho Chi Minh and Manila. This contributed to the growth in tourist arrivals from Vietnam by a significant 45 percent. The DOT, Philippine Airlines and Cebu Pacific will embark on new joint promotions to further mine the Vietnam market.

Aside from our Asian counterparts, the Philippines also has a strong presence in Europe.

Carrying the theme ‘Imagining an archipelagic future’ under that banner of ‘Water and Sustainable Development’ at the world’s biggest exposition recently held in Zaragoza, Spain, the Philippines definitely carved a niche in the tourism market with its unique and noteworthy participation.

"With the revolutionary concept of ‘celebrating an archipelago’ through community-driven water resource projects, state-of-the-art energy production, green advocacy, eco-tourism activities, water-inspired poetry & music, and grass-roots efforts for water conservation, the Philippine pavilion was sure to strike gold," said Domingo Ramon Enerio, Tourism Attaché for London and Deputy Commissioner General of the Philippine delegation.

Overall, the Philippines’ participation at the 2008 Zaragoza Expo has reaped valuable benefits for the country’s tourism campaign, which has been growing in earnestness throughout Europe.

Thursday, 2 October 2008

Southrail Update

CLICK HERE FOR PHOTOS BY JAFITI, at http://lagunarailways.rihspi.org/2008/09/southrail-update.html.

Sample photo: photo of newly-refurbished locoshed at Tutuban

Northrail-Southrail Linkage Project Update

CLICK HERE FOR FRESH SHOTS OF CONCRETE TIES PRODUCTION AT PNR CALOOCAN, BY JAFITI, AT http://lagunarailways.rihspi.org/2008/09/concrete-ties-production-at-pnr.html.

Sample shot

3 foreign carriers may transfer to NAIA-3

Paolo Luis G. Montecillo
BusinessWorld Online
http://www.bworldonline.com/BW100208/content.php?id=045

THREE foreign airlines have expressed interest to eventually move their operations to the Ninoy Aquino International Airport Terminal 3 (NAIA-3) once the airport is ready to fully operate.

In an interview yesterday, Manila International Airport Authority (MIAA) Assistant General Manager of Airport Development Tirso G. Serrano said the airlines had verbally expressed their intent to move to the terminal, which partially opened in July.

"Three to four international airlines are interested in moving [to the new terminal] as soon as the facilities allow it," he said.

NAIA-3 — now occupied by local carriers Cebu Pacific, Philippine Airlines (PAL) low-cost brand PAL Express and Air Philippines — is running at around 60% of full capacity of 13 million passengers yearly.

But Mr. Serrano said the transfer of other airlines to the terminal would depend on the resolution of cases hounding the new terminal. The Supreme Court has barred airport officials from signing long-term contracts for the use of the facility.

... "Once the legal problems are resolved, we’ll be able to go into long-term contracts," Mr. Serrano said.

He said the MIAA had "made a lot of ground" since the airport opened. The government has since installed working flight information display systems. It would take take [sic] for the terminal to reach its goal of full automation, Mr. Serrano said.

PAL President Jaime J. Bautista on Tuesday said the airline had no plans yet to move to the new terminal, which he said might not be ready yet to handle the flag carrier’s operations.

...

"I do not think it can take our flights especially for the US, where safety and security standards are stricter," Mr. Bautista said.

Mr. Serrano said the NAIA-3 is in the process of applying for an International Organization for Standardization certification, which should reflect its safety. He said airport officials expect to receive the certification by yearend.

The NAIA 3 is expected to decongest Manila’s airport system, which consists of the NAIA Terminal 1 and 2, and the Manila Domestic Passenger Terminal. The Manila terminals used to serve more than 20 million passengers [last] year — above its capacity of 18 million passengers.

Philippines population bill a waste of resources: think tank

http://afp.google.com/article/ALeqM5iBiNsm8WC5JTaZ_e-MbpUl1p-N6Q

MANILA (AFP) — A bill seeking to impose population control in the Philippines is a waste of valuable resources that would be better ploughed into education and infrastructure, a conservative think-tank said Thursday.

The proposed law comes at a time when countries that adopted similar policies in the 1970s are reversing them as they start to worry about supporting their ageing populations, said the economists at Manila-based University of Asia and the Pacific.

Its chief economist Bernardo Villegas said controlling the population would be "demographic suicide," and would put the blame for widespread Philippine poverty with "people who are not yet even born".

The bill is about 12 votes shy of passing the House of Representatives, according to its principal author and House member Edcel Lagman.

However, it lacks the support of President Gloria Arroyo, a devout Roman Catholic who could theoretically veto it even if passed by the House and the Senate. Lagman said a dozen previous population bills over the past generation had been defeated.

The dominant Catholic church has threatened to excommunicate legislators who vote for the bill.

Under the proposed law the state would have to fund a population programme, teach it at schools and to couples intending to marry and have government hospitals offer contraceptives, vasectomies and tubal ligations, an operation that blocks the fallopian tubes.

It would require the state to "encourage two children as the ideal family size".

The Philippines has among the highest birth rates in Asia, with the population growing at around two percent annually and expected to top 100 million in five years.

Villegas told reporters solving poverty that binds a third of the population required improving the quality of basic education, curbing corruption and devoting state resources to developing the countryside, where the largest concentrations of poor live.

"The greatest impact of your peso is in educating women," said Roberto de Vera, another economist at the same school.

Villegas said international studies showed the growth of per capita income was related to school enrolment rates rather than population control.

"Countries with higher human capital also have lower fertility rates," he added.

Contrary to popular convention, he said the fertility rate of Filipino women had fallen from six children in 1975 to fewer than three.

Even without state intervention, the Philippine population would peak at 111 million in 2025, with a maximum population density of just 370 people per square kilometre (0.39 square miles), he added.

With NAIA-3, expect holiday ease

By Tarra Quismundo
Philippine Daily Inquirer
http://newsinfo.inquirer.net/breakingnews/nation/view/20081002-164241/With-NAIA-3-expect-holiday-ease

MANILA, Philippines -- Partial operations at the Ninoy Aquino International Airport Terminal 3 (NAIA 3) are expected to ease airport congestion during the holidays, the Manila International Airport Authority (MIAA) has said.

MIAA corporate affairs and airport development chief Tirso Serrano said operations at the recently opened terminal would ease the usual airport congestion during the annual year-end travel peak because most domestic flights have been operating at the facility.

“Definitely, it will be a big departure from the experience of passengers in 2006 and 2007 because now, we are seeing domestic passenger flow at NAIA 3, especially in terms of congestion during the Christmas season,” Serrano said.

“The new terminal will be big enough. And hopefully, we will serve the needs of other domestic airlines because now we will be able to entertain additional flights,” he said.

NAIA operations chief Octavio Lina said the travel rush has been expected around the middle of November, with roughly 17 to 20 percent increase in daily arrivals and departures.

The entire complex, including all three NAIA terminals and the Manila Domestic Terminal (MDT), see close to 55,000 outbound and incoming passengers daily, MIAA figures show.

Serrano said Cebu Pacific's move to Terminal 3 removed most of domestic traffic out of the old MDT, the aged facility that had shown the worst case of congestion in the past years.

CEB moved all of its domestic and international operations to NAIA 3 when the facility opened in July. With the airline now out of MDT, the old terminal now hosts only a tenth of the daily average passenger volume of 12,000 it had handled before NAIA 3 absorbed CEB's domestic flights.

“Right now, there's just a little over 1,000 passengers passing through the domestic terminal. It will undergo rehabilitation to get it ready for future flights,” Serrano said.

Besides CEB, Air Philippines and PAL Express also operate domestic flights at the recently opened terminal.

Philippines to focus on infrastructure and agriculture

PGMA's economic team ready with action plan to tide off effects of U.S. banking crisis on RP economy
http://www.news.ops.gov.ph/today.htm#economy

President Gloria Macapagal-Arroyo and her economic team are all ready with an action plan to insulate the Philippines from the volatile global economic crisis aggravated by the U.S. financial turmoil.

Finance Secretary Margarito Teves said the positive development yesterday on the $700-billion bailout deal for the US financial services, with the US Senate voting 74-25 in favor of the measure, “improved chances of recession not taking place.''

Teves said the success or failure of the proposed US bailout measure has an important real and psychological effect on economies.

He expressed optimism that the success of the bailout bill will definitely improve chances of recession not taking place although he said slowing down of global economies will still be there.

However, Teves said the economic growth of 7.3 percent last year is not possible this year, nor next year, given the present global economic scenario; even as he remains optimistic that with the action plan in place, the scaled-down growth targets are realizable.

''Who would ever have thought that 2008 would be what we are in today, after 2007. But that's right, that's how business and economics go. Like most activities, we plan that's why we work, much less make sure we have an action plan for all,'' he said.

To help address the effects of this global economic turmoil caused by the US credit crisis, Teves urged Congress to pass three pending bills -- the 2009 General Appropriations bill, the Rationalization of Fiscal Incentives bill, and the Rationalization of Sin Taxes bill.

''We need more revenues to handle difficult times and therefore we, the economic team, would like to pursue two important measures,'' he stressed.

On the other hand, socio-economic Planning Secretary Ralph Recto stressed the need to increase infrastructure spending and to increase investments in agriculture.

''The mantra of NEDA (National Economic and Development Authority) is infra, infra, infra to improve the growth rate of the economy and make the economy more efficient; and to attract more investments into the Philippines is all the more important now,'' Recto said.

Recto also said that the challenge the economic managers face now is how to reduce inflation and to spend for sustainable growth in the future through increased government spending on infrastructure and agriculture productivity.

''Medium term, we are in a better position to cope with the crisis and if we continue improving our revenue collections and GDP efforts,'' he added.

Recto added that there is a brighter growth prospect moving forward for the Philippines considering that the country's ''macroeconomic fundamentals are even better than the US.''

He cited the savings rate where foreign debt servicing has gone down, which means that ''we can finance our own development... we have more liquidity in the system.''

For his part, Budget Secretary Rolando Andaya Jr. said the proposed 2009 national capital layout ''focuses on infrastructure'' as he stressed that the proposed 2009 national government budget has the ''embedded solution to the problem,'' with infrastructure allocation proposed to be increased by 20 percent, and agriculture, by 50 percent.

Andaya stressed that there is no need to revise the proposed 2009 budget as this was ''crafted in anticipation of this particular problem.''

''The challenge now is to be able to have these agencies spend the money we have for 2008. For the first few months, there have been flat growth in terms of infrastructure spending but through reforms instituted, June, July and August, there have been significant increases,'' Andaya noted.

For his part, Bangko Sentral Deputy Governor Nestor Espenilla said there is a need to ''work on tax administration measures'' to generate more revenues as he stressed that there will be no new taxes.

The economic managers said the Philippines is an emerging economy that can be adversely affected by the fate of the new $700-billion bailout package deal for the US financial services sector.

Thus, the President's economic team had scaled down their growth targets for this year and next year to be ''realistic, credible and transparent'' given the present scenario in the global economy.

From the revised 2008 growth target of between 5.5 and 6.4 percent, the economic team now sees the economy growing by 4.4 to 4.9 percent this year.

For next year, a growth of 4.1 to 5.1 percent is expected.

Wednesday, 1 October 2008

Underwater Paradise

The Philippine Star
http://www.philstar.com/index.php?Agriculture&p=49&type=2&sec=38

“I haven’t seen anything like it in the world,” said James Adair, on the wealth of marine life that includes tiny seahorses, trigger fish, pipefish, frogfish, napoleon wrasse, gigantic whale sharks, barracudas, carpet sharks, and white tips, and astonishing coral formations of Sogod Bay in Leyte.

Adair, expedition leader of Coral Cay Conservation (CCC), brought 20 scholars with him to survey Sogod Bay’s marine species and immaculate corals for conservation.

CCC is UK’s award-winning non-government group of specialists working for coral reef and tropical forest conservation.

The British explorers raved about the exceptional dive spot and discussed their preservation efforts during a farewell get-together hosted by British Ambassador and Mrs. Peter Beckingham at their residence.

The Department of Tourism (DOT) together with the British Embassy, the Department of Foreign Affairs (DFA), and the local government of Leyte, hosted Coral Cay’s expedition for this year.

“We fully support efforts of groups like Coral Cay in Leyte which is gradually being discovered as the world’s latest hub of marine biodiversity,” said Tourism Secretary Ace Durano.

DOT Undersecretary for Planning and Promotions, Eduardo Jarque Jr. added: “We wish Sogod Bay the same success as CCC had in Danjugan Island in Negros which was awarded National Best Managed Reef.”

CCC and its partners in ecotourism were able to save Danjugan Island which was affected heavily by coral bleaching in 2001.

Jarque further lauded the commitment of the group to the community, “We also commend the group for educating the community on the importance of preserving resources for livelihood.”

Sogod Bay was featured in a recent issue of UK’s leading dive magazine, DIVER. Marine biologist Matt Doggett who spent six months in the area wrote about the ‘awe-inspiring and mind-boggling’ underwater wonderland of Sogod Bay. Dogget gushed about the drift dive in Baluarte where he saw different kinds of sponges that are home to the hawkfish and featherstars. He further marveled about the other Marine Protected Areas (MPAs) where he found teeming aquatic life, from the 12-meter long whale sharks to the tiny nudibranches.

Jaudelle Gold, one of the CCC scholars, said: “The best part of the Philippines is the people. When we painted the schools in the community, we were touched by the warmth of the school children.“

Coral Cay also works with Year-Out Group, the biggest British group that sends more than 200,000 secondary students from the UK to various parts of the globe. This number is a potential tourism market sector for the Philippines.

Province in Canada needs thousands of Filipino professionals, workers

By NIÑA CORPUZ, ABS-CBN News | 10/01/2008 1:50 PM
http://www.abs-cbnnews.com/pinoy-migration/10/01/08/province-canada-needs-thousands-filipino-professionals-workers

Ten thousand professionals and workers are needed immediately in the province of Alberta in Canada as they are experiencing a shortage in doctors, nurses, dentists, engineers, machine operators and mechanics.

The Canadian province of Alberta has entered into an agreement (Memorandum of Understanding or MOU) with the Philippines’ Department of Labor and Employment (DOLE) concerning human resource deployment and development to promote employment opportunities in Alberta.

Hector Goudreau, Alberta's Minister of Employment and Immigration said they prefer Filipino workers because of their skills, flexibility, adaptability and good work ethics.

"You have people and we don't," said Goudreau.

Those who want to apply to Alberta are required to have experience which is why Philippine Labor Secretary Marianito Roque is looking at "labor mobility" where DOLE plans to transfer overseas Filipino workers (OFWs) whose contracts are about to expire in countries like the Middle East and move them to Canada.

Roque said that OFWs in Canada earn much higher than those in the Middle East.

For example, welders earn 6,000 Canadian dollars a month compared to only 400-500 dollars in Saudi Arabia. Pipe fitters earn 3,800 Canadian dollars and Nurses earn 4,500 Canadian dollars.

Like those in the Middle East, Alberta is seeking temporary workers who can work up to two years but they are welcome to attain permanent residence through "Alberta's Immigration Program for Skilled Workers".

Roque also emphasized that all recruitment costs related to the hiring of OFW's under the MOU shall be covered by the employers in Canada.

The employment agency in Canada and the recruitment agency in the Philippines therefore are not allowed to charge any recruitment fees in any form from OFWs bound for Alberta.

Aside from the recruitment of OFWs, Roque pointed out that an important part of the agreement is Human Resource Development wherein the Province of Alberta will invest to set up training opportunities in the Philippines or tie up with schools to train or upgrade the skills of Filipinos.

"Hindi lang tayo padala ng padala, kailangan mag-train din sila dito para hindi naman tayo maubusan ng skilled workers," said Roque.

as of 10/01/2008 1:50 PM

ADB lends $250M to Philippines for fiscal, governance reforms

Agence France-Presse | 10/01/2008 2:09 PM
http://www.abs-cbnnews.com/nation/10/01/08/adb-lends-250m-rp-fiscal-governance-reforms

The Asian Development Bank (ADB) said Wednesday it is extending a loan of 250 million dollars to the Philippine government, which is trying to implement a number of economic reforms.

The money will go towards improving fiscal management and supporting social reforms, the Manila-based ADB said in a statement, as President Arroyo tries to make the country more attractive to investment.

A number of reforms have led to macroeconomic stability and brought the national deficit under control, the lender said.

However the country has been hit hard by the rise in oil and food prices and the financial crisis in the United States, it added. This has hampered the efforts to maintain stability while making it harder to protect the poor.

Arroyo has put into place a number of measures to boost revenues and put the budget deficit under control since 2005 despite opposition from activist groups and even the church.

The ADB is also extending a grant of 800,000 dollars to support "public expenditure reform initiatives" at the Department of Budget and Management, the lender said.

Tuesday, 30 September 2008

Philippines can ride out US financial crisis: experts

by LALA RIMANDO, abs-cbnNEWS.com/Newsbreak | 09/30/2008 2:58 PM
http://www.abs-cbnnews.com/business/09/30/08/rp-can-ride-out-us-financial-crisis-experts

While the financial markets in the US and Europe go through days of wild roller-coaster ride as they seek solutions to trillion dollar-worth toxic mortgages, Philippine analysts and regulators continue to hammer messages that could be summed up with this: Relax.

Markets all over the world, especially in the US, Europe, and some Asian exchanges, plunged immediately after the US congress thumbed down Monday the proposed $700 billion bailout plan that was supposed to solve the core of the mortgage problem that rippled to various financial players beyond the banking system.

Yet, the Philippine Stock Exchange, an indicator of investor sentiments, ended its Tuesday trading only 1.4 percent lower, better off than other markets, some of which ended in historic lows. The Dow Jones, an index that tracks financial performance heavy industries in the US, was down by as much as 7 percent overnight, wiping out up to $1.2 trillion in a single day. Britain's FTSE index was down 5.3 percent to a three-year low, while Asian markets, like Japan and Hongkong, were lower by 4.6 and 2.5 percent, respectively.

The immediate impact of the US Congress' vote on the bailout to the Philippines would be more of a knee-jerk reaction, analysts said. But while there will be long term consequences to the Philippines, Nestor Espenilla, Deputy Governor of the Bangko Sentral ng Pilipinas (BSP), said "It’s nothing that financial markets in the country can’t handle."

According to the BSP, about 7 Philippine banks have a total exposure of $386 million to bankrupt Lehman Brothers, one of the giant US investment banks that tumbled amidst the panic over toxic US housing debts. That accounts for less than one percent of the entire banking system, which, through the years, has been buffed up so it could withstand shocks.

“In terms of direct impact on our financial system, it’s still very minimal," Espenilla said in an interview at ABS-CBN News Channel’s News at 8. "As we’ve earlier pointed out, we are coming into this crisis relatively well-prepared in terms of capital adequacy, liquidity, and asset quality."

Jojo Gonzales, Chief Analyst of Philippine Equity, also noted in the same cable show, that there is no credit crunch in the country, unlike how it is in the US and Europe where investors and bankers are hardly transacting or lending, thus their economy is in a virtual standstill.

"To illustrate the fact that there is no credit crunch in the Philippines, the auction yesterday for Treasury Bills (indicator of cost of borrowing among banks) was two times oversubscribed. That hardly qualifies as credit crunch," Gonzales stressed.

In other words, the Filipinos will not have to go through a similar decision of whether any local players in the financial system would need to be bailed out too.

Philippine politicians will also be spared with a similar task of voting on whether taxpayers' money should be spent to stem a gaping hole that the rich have created. Unlike their US counterparts, who decided 208 to 205 in favor of thumbing down the bailout plan, the US congressmen have an upcoming elections to think about when deciding whether common Americans should shoulder the losses that high flying Wall Street executives created.

Not now but later

So far, there are anecdotal indicators of Filipino consumers spending less on their mobile phones and retail purchases. Still, according to Gonzales, there is no reason to fret, since it's the Philippine companies that are absorbing most of the US crisis impact now.

"I imagine the impact at this point is not so much on end consumers. Much of what we are seeing right now is pressure on profit margins of corporates because of inflation." Gonzales said.

Filipinos, however, would have to still keep their eye on the goings on in the financial markets abroad, especially in the US, since the consequences to the Philippines will be felt later.

One indicator would be the impact of what's happening in US financials to the credit market. The Philippines is one of the biggest debt issuers in Asia, and several Philippine companies have issued foreign debts to raise funds too. Benchmark interest rates, which banks all over the world use as guide in pricing debt instruments, will affect the cost of debt instruments that the Philippine government and companies have or will issue.

"Right now, we are just spectators watching what’s happening in the US. [And the] Philippine companies and the government don’t have to borrow right now. But 3 or 6 months from now, if the benchmark rates don’t come down, I think it will ultimately impact RP as well," Gonzales pointed out.

PJ Garcia, Chief Investment Officer of ING Bank Philippines, also noted that while some are reacting out of knee-jerk impulse, down the road there could be an impact on the fundamentals of the Philippines as well.

For one, exports volume and value could be affected as Americans, who are still the world's biggest group of consumers, hold on to their cash to cope with the credit crunch.

To Garcia, what this means to the Philippine companies is that “There will definitely be some downward revisions on growth assumptions for the next 12 to 18 months. There would have to be some review on earnings assumptions [of companies] for next year if you see a slower economic growth and lower domestic demand or, in this case, possibly slower export growth."

With the US now facing a possible recession, the impact to the Philippines will ultimately depend on how long and how deep the US economy will be in the doldrums.

The first to be hit will be the pace of our economic growth.

"It is fair to assume that the rates of [economic growth] will slow sharply," Gonzales warned.

Based on a best-case scenario of a "short and shallow" recession in the US, Gonzales projects that the local economy's growth will slow to about 4 percent this year. That's a far cry from last year's economic growth rate of more than 7 percent.

"The worse it gets in the US, the lower number you will see in the Philippines," Gonzales stressed.

Earlier, the range of estimates for economic growth in 2008 was between 4.5 to 5 percent. Gonzales noted, however, that these projections were made a couple of months back, long before Monday's shocking outcome of the US congress vote on the bailout.

"Nobody envisioned what's happening now. So there is room for those [growth] estimates to come down a bit further," Gonzales said.

Ride it out

Whether the current goings on will eventually translate to a major pinch to Filipino's income--and if ever, how much it will hurt--is yet to be seen.

Meantime, the message from analysts and regulators remain: Relax. It's all part of business and economic cycles.

According to Espenilla, these are cycles the Philippines could confidently ride out.

"In the end, these are really businesses that have ups and downs. Right now is really a clear 'down' scenario. We have the capacity to withstand this. We can ride this out."

Chefs join nurses, seafarers in RP 'hot' jobs list

by ROSEMARIE FRANCISCO, Reuters | 09/30/2008 11:41 AM
http://www.abs-cbnnews.com/features/09/30/08/chefs-join-nurses-seafarers-rp-hot-jobs-list

MANILA - The Philippines, which for decades has supplied the world with a steady stream of seafarers, nurses, caregivers and domestic helpers, is now exporting practitioners of a cutting-edge trade: chefs.

"Chefs are the new rock stars now. Everyone wants to be a chef," said Ian Padilla, a Filipino chef entre metier at Parisian restaurant Taillevent, a Michelin two-star establishment.

"When I started, there were hardly any culinary schools here ... And there was no chef, it was just the cook. When I got back, there are culinary schools everywhere," said Padilla, who came home recently to judge a cooking competition.

In 2000, there was just one culinary school in the Philippines. These days, there are about 400 cooking schools with scores more sprouting up every year across the Southeast Asian island nation.

The enthusiasm with which Filipinos are taking up cooking is not surprising. A global scarcity of cooks and chefs mean that culinary school graduates can earn as much as $4,000 per month working abroad.

That is an astronomical sum of money in a country where the average wage is 10,000 to 15,000 pesos ($214-$321) per month.

Some nine million Filipinos work abroad, often in menial jobs, sending home about $1 billion in remittances that keep the local economy afloat and support the local currency.

With jobless rates at over 7 percent and many hurting from high fuel and food prices, more Filipinos than ever before are seeking jobs abroad.

Nursing has been popular for a long time as Filipino nurses can earn around $1,000 to $4,000 a month working abroad, filling the gap in hospitals in the United States, Europe and the Middle East due to a global shortage of medical workers.

But becoming a nurse requires at least four years of college studies, while a prospective chef can get a culinary certificate in a month. A diploma course would take about 14 months.

The short waiting time for a culinary diploma or certificate sometimes comes with a steep price.

At Gandler's International School for Culinary Arts and Hotel Management, tuition fees for a 14-month culinary diploma course costs 310,000 pesos ($6,675), not easily affordable for the average Filipino, many of whom become maids or sailors instead.

Still, enrolment remains high even at the five-year-old school formed by Austrian chef Norbert Gandler, who has run five-star hotel kitchens in the Philippines.

"In fact, we even have a waiting list," Gandler said, adding his school is now at its full capacity of 280 students per year.

Cooking up a storm

The Philippines sent out almost 8,400 people to kitchens all over the world last year, two-thirds of whom were chefs and cooks. In 2000, just under 1,900 Filipinos left to work in kitchens abroad.

That figure is small compared to the number of Filipinos who work abroad as domestic workers and sailors. An estimated 50,000 Filipinos left the country last year to work as maids for the first time, while about 230,000 Filipinos worked as seafarers.

"Someday, I can be like those who went before me and become successful in working abroad," said 21-year-old Fitz Gerald Carpio, one of several students who drew out kitchen knives to compete at the Manila culinary festival last week.

There is high demand for Filipino chefs abroad, partly due to their English proficiency, diligence, and good work attitude.

"England is now looking for 300 chefs, they go around to competitions like this," Michaela Fenix Makabenta, food columnist and editor in chief of Food Magazine, told Reuters on the sidelines of the food competition last week.

"You can imagine, we are sending them out as soon as they graduate," she said. "It is the easiest route to going abroad. Like Australia, there is a high priority for chefs. If you apply, you will be hired right away."

Filipino chefs can be found on cruise liners and in hospitals and military camps in the Middle East. The lucky ones may find jobs in cordon bleu restaurants or in kitchens in the palaces of Middle East sheikhs.

"I've been to a lot of restaurants. There's always a Filipino guy in a kitchen anywhere in the world," said Richard Tan, a chef and instructor at the Magsaysay Institute of Hospitality & Culinary Arts. ($1 = 46.44 pesos)

Monday, 29 September 2008

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Selected Philippine Economic Indicators

August 2008 Issue
Released 15 September 2008

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Philippines to start exporting corn for the first time

By Othel V. Campos
The Manila Standard
http://www.manilastandardtoday.com/?page=news2_sept29_2008

FROM a traditional importer of corn, the Philippines may now export the grain for the first time after local farmers entered into a supply agreement for 300,000 metric tons with a Korea trading firm.

“Negotiations have been ongoing for months now, but it was only this week that we received firm commitment from [Korea Overseas Grains Investment Co.],” said Roger Navarro, president of the Philippine Maize Federation Inc.

Navarro said his group and the Korean firm were still negotiating the price of the shipment, which is tentatively set at P16 per kilogram.

“We were told they [Koreans] will pay for the shipping cost, but this is not yet final,” Navarro said.

“We know they might haggle, knowing how expensive freight costs are nowadays. If they haggle with us, we [will be] setting a floor price of not less than P13 per kilo.”

Navarro said the Korean group was being more cautious after a recent scuffle with an Indonesia trader, who had shipped corn of poor quality.

The Korean group visited Mindanao last weekend to assess the Philippine corn sector’s capacity to supply corn, and then started negotiations for a possible corn supply agreement.

Navarro said his group was still studying how to ship the corn—by bulk handling or using 40-foot container vans.

“We have 20,000 tons of corn which we plan to use for a trial shipment next month, he said.

“We might start with at least 10,000 tons via container shipment.”

Navarro said his group started exploring export markets because they were frustrated with the government’s policy on support programs for the corn sector.

The group asked an inter-agency task force on rice and corn to increase the support price for yellow corn to P13 a kilo, but the panel increased its buying price by only P2.50, to P10 from P7.50 a kilo.

But National Food Authority Administrator Jessup Navarro said Friday his agency was studying if it could increase its support price for yellow corn to P11.50.

“We are sad that the government failed to understand our quest for a support price of P13. Much as we are frustrated with how the government answered our plea, we hope that market prices will be able to self-correct, and that the real price will be known and implemented,” Navarro said.

Based on the estimates of the Bureau of Agricultural Statistics, corn output for the second semester will be around of 3.71 million metric tons, 9.7 percent short of the government target of 4.11 million metric tons.

“This is just a forecast. We are conducting some production interventions measures that will help the government realize its target output for the year,” said agriculture assistant secretary Dennis Araullo, who is in charge of the government’s Ginintuang Masaganang Ani corn program.

Mindanao Railway plan ready by Dec. 1

By Paolo Luis G. Montecillo
BusinessWorld Online
http://www.bworldonline.com/BW092908/content.php?id=075

THE ADMINISTRATION is finalizing plans for the construction of the long-delayed Mindanao Railway System project, which is expected to spur economic development in the conflict-stricken region.

Speaker Prospero C. Nograles said in a statement on Saturday that "the blueprint of a modern Mindanao Railway System is now taking shape."

President Gloria Macapagal-Arroyo in late June formed the Mindanao Railways Project Policy and Coordinating Committee composed of Transportation Secretary Leandro R. Mendoza, Public Works Secretary Hermogenes E. Ebdane, Jr. and Budget Secretary Rolando G. Andaya, Jr. as members, while Mr. Nograles is the group’s adviser.

Mr. Nograles said the committee has until Dec. 1 to submit its comprehensive report and recommendations to Malacañang.

Mr. Nograles said the rail system will be "an efficient, cheap and reliable railway network crisscrossing the length and breathe of the island, [and] will surely spur productivity, allow the establishment of industries and create tens of thousands of jobs, and catalyze the inflow of foreign investments."

The committee will advise the Office of the President on prioritization/schedule of implementation of the various railway lines in the South; will serve as the coordinating issue-resolution body; and will prepare a development plan to the President for approval not later than Dec. 1.

It was also tasked to identify and recommend modes and sources of financing for the project.

The projected cost of the project was not mentioned.