Saturday, 15 December 2007

Construction of Luzon railway project starts

By Roderick T. dela Cruz
Original report at The Manila Standard

Work on the first phase of the North Luzon railway project costing $421 million began last month, putting it on track for completion by 2010, the new president of North Luzon Railways Corp. said yesterday.

NorthRail Corp. president and chief executive Arsenio Bartolome III, in a speech before the Rotary Club of Manila, said the first phase of the project stretching from Metro Manila to Northern Luzon was currently under construction.

Phase 1 of the NorthRail project is subdivided into two sections, with the first stretching from Caloocan to Malolos in Bulacan province and covering 32.5 kilometers with six stations to be built at a cost of $421 million.

Section 2, which will cover a distance of 51.5 kilometers with six stations from Malolos to Clark Field in Pampanga, will cost $586 million.

Bartolome said Section 1 would have 19 diesel multiple units, which were upgradable to electric multiple units. Once completed by the first semester of 2010, Section 1 will cut travel time from Caloocan to Malolos to just 30 minutes, benefiting some 125,000 passengers in the first few months of operations.

Section 2 is expected to reduce travel time between Malolos and Clark Field to 30 minutes. Once completed by 2011, it will have 23 trains transporting thousands of passengers.

“It is essential and necessary to the economic progress and prosperity of the Philippines,” he said in response to new controversies surrounding China-funded projects in the Philippines.

The Philippine government has approached the Chinese government for funding of the NorthRail project.

In turn, the Chinese government appointed China National Machinery and Equipment Corp. to handle the design, supply and construction of the project and the Export Import Bank of China to take care of financing.

Bartolome asked the public to support the project, saying it would benefit millions of Filipinos, including commuters, farmers, traders, workers and students, who would profit from the cheap and fast mass transportation system.

He said that once the Northrail project became operational, it would also enhance and accelerate the development and growth of Central and Northern Luzon, decongest motorized traffic in Metro Manila and provide linkages to the MRT and LRT light rail systems.

RP urged to ratify JPEPA

Charissa M. Luci
Original article at The Manila Bulletin

TOKYO, JAPAN — The Japanese government has reiterated its call on the Philippines to immediately effect the ratification of the Japan-Philippines Economic Partnership Agreement (JPEPA) which aims to strengthen trade relations between two countries.

Japanese Assistant Press Secretary Kazuyuki Yamazaki, the director of the Internal Press Division of the Ministry of Foreign Affairs, said Tokyo is still hoping for an early entry into force of the treaty, which the Philippine Senate has yet to ratify.

"It’s up to the Philippine government and the Filipino people. We already have done negotiations with the Philippine government and we hope for the early ratification of the Japan-Philippine Economic Partnership Agreement," the Japanese official said during the welcome dinner for the visiting Asian journalists in this city.

The treaty has been shelved due to environment, legal, trade and investment issues, one of which is the exportation of hazardous wastes to the Philippines.

Yamazaki said Japan won’t do anything that would harm the country’s natural resources and they are "not pressing" the government to ratify the treaty, which was signed by Japanese Prime Minister Junichiro Koizumi on Sept. 9, 2007, at the sidelines of the 6th Asia-Europe Meeting in Helsinki, Finland.

"We have explained our position and we already expressed it to the Philippine government," he said, citing that they have complied with various international treaties on environment.

"Our commitment to the international convention on industrial waste remains to be the same," he pointed out.

Among those Asian countries that have EPAs with Japan are Brunei, Singapore, Malaysia, Indonesia, and Thailand.

For his part, Yuzo Yagai, section chief administrator of the Climate Change Policy Division of the Global Environment Bureau, Ministry of Foreign Affairs, said Japan, being the proponent of the Reduce, Reuse, Recycle (3R) initiative would take the lead role in proper waste disposal in Asia.

"If it is specifically an environmental issue, that will be brought to our attention and if it is in the industry, that should be addressed by the Ministry of Economy, Trade, and Industry," Yagai said.

"As a proponent of the 3R movement, I do not believe that we will do anything to violate and to run counter against that principle," he said.

RP gains in corporate governance

Original report at The Manila Bulletin

The Philippines has made significant improvements in corporate governance quality (CGQ), among the economies of Southeast Asia, based on market data reported by non-financial firms from the mid-1990s up to the early 2000s, ranking third behind Hong Kong and Singapore.

This is one of the key findings of a recent (July 2007) study released by the International Monetary Fund (IMF). Among the countries covered by the study are China, Hong Kong, Indonesia, Malaysia, Philippines, Singapore, South Korea and Thailand. The report, written by IMF economists Gianni di Nicolo, Luc Laeven and Kenichi Ueda, covered CGQ data in these countries between 1994 and 2003.

Dr. Jesus P. Estanislao, chairman, Institute of Corporate Directors, observed that the study is based on accounting and market data, and not on what regulators have been imposing and trying to enforce. In this regard, they consider the measure as "de facto," i.e. based on performance or outcomes that can be read out of actual market data. The measure is not based on "de jure" requirements from regulators."

Unlike measures based on perceptions, e.g. of investment fund managers, this measure is based on accounting data that are put together on the basis of current finance literature, Estanislao added.

The study found that "corporate governance in most countries has improved overall, with varying degrees and notable exceptions, cross country convergence quality with countries that score poorly initially catching up with countries with high governance scores, and the impact of improvements in corporate governance quality on traditional measures of real economic activity — GDP growth and the ratio of investment to GDP, is positive, significant and quantitatively relevant, and the growth effect is particularly pronounced for industries that are most dependent on external finance."

The IMF study noted that the CGQ index is a simple average of three indicators, called Accounting Standards (AS); Earning Smoothing (ES), and Stock Price Synchronicity (SPS).

These indicators are constructed from accounting and market data for samples of non-financial companies listed in stock markets taken from the Worldscope and Datastream databases.

National Competitivness Council co-chair, private sector, Ambassador Cesar B. Bautista said "the IMF report is a major indication that the corporate governance campaign of the private sector has now begun to bear fruit and that our country’s competitiveness standing will be enhanced, especially if Philippine corporations will accelerate their initiatives in such areas as transparency, directors’ training and the integrity of their financial reporting."

For his part,Dr. Estanislao, proposed a Road Map that the country should use in traveling on a pathway to even more significant improvements in corporate governance quality.

With this Road Map individual corporations should use the base already laid out by the current regulatory regime, which have implemented significant changes in view of the additional requirements for corporate governance practice our regulatory authorities have already mandated.

In this regard, a corporate retreat, involving the Board of Directors, can be used as an occasion for formulating and clarifying a corporate strategy map, Estanislao added. Also of critical importance is an active corporate governance improvement agenda.

This is to be gleaned from the results of the corporate governance scorecard, already undertaken for all publicly listed corporations in the Philippines, which identifies the areas in which a corporation’s corporate governance practice is already strong, and the areas where it remains weak.

Dr. Estanislao also said that the Philippines "should also moderate its tendency to bash itself in the head."

"There is no way the Philippines can score high on a scale determined by perceptions: we manage to present a bad image of ourselves by the notoriously straightforward and negative comments we make about the Philippines. But even the IMF economists in their econometric analysis of corporate governance quality measures put the Philippines in the top three for East Asia, although it must be admitted that our over-score is only marginally better than the corresponding scores for our immediate neighbors in Southeast Asia and thus can stand improvement, " Dr. Estanislao added.

RP’s Molina is 24th SEA Games MVP

Original report at GMANews.TV

Filipino swimmer Miguel Molina was voted as the Most Valuable Player (men) of the 24th Southeast Asian Games, which ended Saturday, according to a Philippine delegation report from Nakhon Ratchasima in Thailand.

Molina, who played an important role in the Filipino swimmers' eight-gold haul from the pool, was chosen by the 18-member selection committee (12 men and 6 women).

Host Thailand's Natthanan Chankrachiang was chosen as MVP for the women's side. Chankrachiang is also a swimmer.

Molina and Chankrachiang emerged as the winningest athletes from their respective delegations.

The two were to receive Baht 330,000 (US$10,000) each, aside from a crystal trophy weighing 1 ½ kilos from the Thai Prime Minister, Gen. Surayud Jullanont, during Saturday evening's colorful closing ceremony at His Majesty The King's 80th Anniversary Stadium.

Molina became the second Filipino swimmer to be accorded the biennial meet's top performer after Eric Buhain, another pool specialist who went on to become former Philippine Sports Commission chair and now head of the Games and Amusements Board.

Buhain actually emerged the Games Most Outstanding Athlete (male) back-to-back, first in 1989 and again in 1991.

Buhain remains the first and only athlete so far to have earned the distinction in the race.

Molina topped the men's 200-meter individual medley, 400-m individual
medley and 200-m breaststroke and teamed up with Daniel Coakley, James
Walsh and Ryan Arabejo to rule the 4x100 medley relay.

Aside from his four golds, the United States-based Molina also scooped up the silver in the 4x100 freestyle relay in a team-up with Kendrick Uy, Coakley and Walsh.

Molina was nominated by Sports Communicators Organization of the Philippines (SCOOP) president Eddie Alinea, the Philippine representative to the voting committee whose members included various Thai media organizations and a representative each from Philippine, Malaysian and Singaporean press.

Chankrachiang ruled the women's 100-m freestyle, 200-m freestyle besides anchoring the Thai 4x100 and 4x200 freestyle relay teams to victory.

The selection committee was chaired by Pacheun Kampo, deputy director of National Broadcast of Thailand, with Wichien Naksrinual, senior executive vice president of TOT Public Company Limited. - GMANews.TV

Friday, 14 December 2007

The high costs of inaction and delay

By Roberto R. Romulo
Friday, December 14, 2007
Original article at The Philippine Star

One of the glaring weaknesses of governance in our country is the bureaucratic tendency to strictness in dealing with little matters, and to laxity and obliviousness to rules when tackling larger issues. Our bureaucrats exhaust themselves debating the price of paper clips, and then get blindsided on the costs of high-ticket projects like roads, airports and communication networks.

Examples of this proclivity to penny-wise, pound-foolish governance are legion. One of the most distressing, because the case is glaring at us now, is the case of the MRT3 system and our government’s efforts to improve its financing arrangement.

The MRT3 system on EDSA is, by all measures, one of the country’s most successful private infrastructure projects. The system was financed, designed, built, equipped, tested and commissioned by the Metro Rail Transit Corp. (MRTC), and it was delivered to the Republic on time and on budget in 2000 pursuant to the terms of a Build-Lease-Transfer (BLT) Agreement. Since then, MRT3 has become an integral part of Metro Manila’s public transport system, reducing traffic along EDSA and operating at beyond capacity with a ridership in excess of 450,000 people on weekdays.

One problem that has dogged the project, however, was its financing arrangement. MRT3 was contracted and built during a time of financial weakness for the Philippine economy, when everything was very expensive and credit was hard to come by. MRT3 financing is costly in comparison to the government’s many options today.

To illustrate, the long-bond annual yield in 2000 hit a high of 15-percent yield to maturity; a number similar to the full, long-term net economic return committed to MRTC equity investors. A 15-percent equity return seems expensive today, but at the onset of the new century that was reasonable and fair considering that long bonds then traded at similar yield, and that equity in the MRTC was funded and expended before debt financial closing, with investors thus assuming great risk.

MRTC and the Philippine Government are in broad agreement that the obligations under the BLT Agreement are full faith and credit sovereign obligations of the Republic. Our government’s direct, sovereign obligation to MRTC is a defined stream of equity rentals (Equity Rental Payments or ERP) defined in Annex Table 2 Annex A-1 of the BLT Agreement which total $2.40 billion from Aug. 14, 2000 to Jan. 14, 2025.

The remaining ERP schedule from Dec. 15, 2007 to Jan. 12, 2025 totals $2.21billion.

The value of the remaining ERP liability today is $1.30 billion which the present value of the remaining ERP obligation at the Republic’s cost of funds, which is 6.14 percent annually.

With all the fiscal improvements of the Philippines today, however, this is certainly a very expensive financial obligation for the nation. This is why serious effort has been made to try to improve upon the financial arrangement for the MRT3.

As things stand, the government has three alternatives before it: (1) To properly service its obligations despite its inconvenient costliness; (2) To willfully breach its direct sovereign obligation; or (3) To negotiate a refinancing and settlement with MRTC.

Option 1 — the silent and proper servicing of its direct, sovereign obligation — may be an acceptable way forward. The ERP obligation represents about one percent of the Republics debt obligation, and the government clearly has the
financial capability to service this. However, this option is
unconscionable if an option for refinancing is available whereby the government can achieve significant savings.

Option 2 — discontinuing service — is inappropriate and unwise for the government to adopt toward one percent of its direct, sovereign obligations, when it can clearly service 99 percent of its other debt obligations in a proper and timely manner. Poor service or breach of a direct, sovereign obligation due to inconvenient high cost is unbecoming of a country in good standing like the Philippines, and it threatens the rule of law, the validity of legal agreements, and the social contract of fulfilling clear obligations.

Option 3 — negotiating a refinancing — is by far the wisest course for the government to adopt. It has been clear for several years now to many government officials, including the technocrats at the Department of Finance, that if an opportunity arises to refinance the ERP obligation at a level that yields significant savings to the Republic, it would be the ideal resolution to the ERP obligations. Fortunately, this opportunity has now arisen with the improving finances and economic outlook of the economy. Early this year, a formal effort was launched to arrive at mutually acceptable terms for refinancing the ERP obligations.

A negotiated settlement was arrived at in principle between the DOF and MRTC last Aug. 27, 2007. But then came a crushing obstacle. The understanding in principle has not been finalized because of the non-acceptance of economic issues by the Department of Transportation and Communications (DOTC). The DOTC has been exhibiting undue concern over the size of the refinancing and misplaced fear of scrutiny over economics. As a consequence, it has frozen the agreement in mid-transaction.

While hopes are still high that a solution will be reached eventually, the DOTC’s freezing of the ball has costs. The freeze has caused a 107-day delay since Aug. 27. The Republic has been paying excess interest, which is interest cost beyond refinancing costs of $120,000 per day. Furthermore, the 107-day delay has caused the MRTC and the government to miss the capital markets financing window before mid-December, when the capital markets are practically closed to transactions. This has caused an additional structural delay of at least 40 more days. The total of 147 days delay to date has already cost the government $17.64 million.

More important, the freeze threatens the availability of the refinancing option itself. I understand that the refinancing discussions were at levels that provided the government with present value savings of $450 million in comparison to present value of specific performance. If the MRTC has no
avenue to negotiate a refinancing transaction with the Philippines, its only recourse is to resolve disputes that may arise out of the ERP obligation through arbitration in Singapore as provided for in the BLT Agreement. It should be clear that the only foreseeable outcome in arbitration is enforced specific performance of a valid contract by the government. Enforced specific performance would ensure that the government cure its arrears and settle related costs, and observe in full the payments schedule of the remaining ERP obligation. Even if no other damages are awarded to the MRTC group, this will leave the government with a liability value today amounting to at least $1.35 billion, including arrears and interest thereon. This is $450 million more than what a proper refinancing may cost today. That is the economic cost of indecision, lack of understanding and fear: $17.64 million to date and maybe an eventual $450million if the DOTC continues to fail in understanding the repercussions of inaction.

I respectfully suggest that the top guys at DOTC carefully review this matter. There is too much at stake here for us to allow bureaucratic rigidity or timidity to carry the day on this one. Precious taxpayers’ money well into the future is on the line. Sound governance may fall victim in the process. While we understand that the DOTC was burned some in the much-publicized controversy over the ZTE broadband project, inaction on the MRT3 refinancing agreement is not the proper course to adopt. The department must act in the interests of the nation and our people, including those yet to be born.

Libya Holds Talks With Muslim Rebels in the Philippines

By Douglas Bakshian
Original report at the Voice of America

The son of Libyan leader Moammar Gadhafi has discussed unifying the two main Muslim rebel groups in the Philippines to help achieve a comprehensive peace between the rebels and Manila. The development came out of a three-day visit to the Philippines by Saif al-Islam Gadhafi. Douglas Bakshian reports from Manila that Libya has played a key role in Philippine peace efforts before.

The Moro Islamic Liberation Front, or MILF, is negotiating a treaty with Manila to end four decades of conflict in the south.

Another Muslim rebel group, the Moro National Liberation Front, reached a peace agreement in 1996 but it leaders complain the pact did not deliver much needed economic development.

The two rebel organizations split decades ago.

Saif al-Islam Gadhafi met with representatives of both groups in Manila Thursday to discuss unity. Libya has mediated for years between the Manila and the Muslim rebels.

Salem Adam, a former Libyan ambassador to the Philippines, traveled with the Libyan leader's son to Manila.

"They discussed the possibility of unity among the Bangsamoro [Moro] Muslims and also they are talking about the time frame," he said. "It should not exceed September 2008 that the Muslims, whether they are MNLF or MILF, should get together and choose their leadership and become one group."

After the talks, the two groups said they agreed to set a timetable for resolving the conflict, "possibly not beyond September 2008."

A road map for this goal will be drawn up under Gadhafi's supervision and in coordination with other Muslim countries.

The Philippine government says it hopes to reach an agreement with the MILF next year, and the MILF has said it is keeping its doors open to the MNLF. Political analysts say unity between the rebel groups is important to a lasting settlement.

Gadhafi, who heads a Libyan charity and development foundation, also met with Philippine President Gloria Macapagal Arroyo and other government officials during his visit.

Libya has played a key role in past peace efforts. It brokered a preliminary peace pact between Manila and MNLF, and has contributed development aid to the country's Muslim regions.

The Organization of the Islamic Conference, of which Libya is a member, has also been involved in the peace process. It initiated the first formal peace talks between the Philippines and the MNLF and has monitored implementation of their peace agreement.

The Philippines is a mostly Christian nation. The MILF has been fighting for a Muslim homeland in south where the Muslim minority is concentrated. The conflict has cost 120,000 lives and billions of dollars in economic losses.

OF Remittances in October Post an All-Time High of US$1.4 billion; January-October 2007 Climb to US$11.9 Billion

Bangko Sentral
Media Releases

Remittances from overseas Filipinos (OF) coursed through banks in October posted a record level of US$1.4 billion. This was higher by 17.1 percent compared to the level posted a year ago. Remittances year-to-date reached US$11.9 billion, an increase of 15.2 percent relative to the level recorded in the same period a year ago.

The growth in remittances was consistent with the observed recovery in the number of overseas workers. Preliminary data from the Philippine Overseas Employment Administration (POEA) showed that total deployment number in October climbed by 3.9 percent to 88,058. This is the fourth consecutive month that the deployment figure was higher compared to the respective year ago level. Classified by type of worker, the number of deployed land-based workers rose by 10.7 percent to 64,066 in October, while the number of deployed sea-based workers contracted by 10.7 percent to 23,992. According to the POEA, the decline in the number of sea-based workers was traced partly to the delay in the workers’ visa issued by host countries and increasing competition from workers from other countries. Nonetheless, the increase in the deployment of land-based workers in October moderated the year-to-date contraction to only 1.1 percent to reach 915,333.

The sustained increase in remittance inflows may also be attributed in part to greater access by OFs to Philippine money transfer agents as the number of remittance centers and tie-ups with foreign financial institutions increased, reaching out to a greater number of Filipino remitters abroad. The enhanced and expanded financial services and products made available by banks and other non-bank remittance channels to remitters and beneficiaries also encouraged more Filipinos abroad to send funds at home.

The U.S., the U.K., Italy, the United Arab Emirates, Saudi Arabia, Canada, Singapore, Japan, and Hong Kong were the major sources of remittance flows during the review period.

Thursday, 13 December 2007

Foreign Portfolio Investment Net Inflow Sustained in November

Bangko Sentral
Media Releases
View table

November 2007 Flows

Transactions in Bangko Sentral-registered foreign portfolio investments resulted in net inflows of US$51.2 million for the month of November. The net inflow could be attributed, among others, to the 25 basis points reduction in BSP’s policy rates, the 6.6 percent GDP growth in the third quarter and additional reports of strong third quarter corporate earnings. The size of the neti nflow was, however, markedly lower than October’s US$274.1 million performance due, among others, to concerns on the widening global credit crunch sparked by the subprime mortgage crisis in the US, soaring oil prices, unfavorable outlook for the US economy, as well as the Batasan and Makati incidents.

On a gross basis, registered foreign portfolio investments1 in November aggregated US$1.3 billion, 62 percent (US$793.8 million) of which pertained to shares listed in the Philippine Stock Exchange (PSE). Investments in peso-denominated government securities, primarily Fixed Rate Treasury Notes or FXTNs, accounted for 32 percent (US$413.7 million) of registered investments, with placements in peso time deposits comprising the remaining 6 percent (US$73.3 million). Capital repatriations amounted to more than US$1.2 billion pertaining to the following: a) divestments from PSE-listed shares (50 percent) and government securities (20 percent); and b) withdrawals of money market placements and peso deposits2 (combined 30 percent share).

January-November 2007 Flows

For the first eleven months of the year, net inflows of over US$3.7 billion were recorded. This level was 1.8 times the US$2.1 billion net inflow realized for the comparable period in 2006. Generally sound economic fundamentals helped sustain foreign investor interest.

Gross investment inflows reached US$14.7 billion, more than double the performance for the same period in 2006. Investments in PSE-listed shares of US$11.8 billion accounted for 80 percent of total, and were 141 percent higher than the figure for 2006. Close to three-fourths of these investments went to telecommunications, utility, property and holding firms. Peso-denominated government securities, primarily FXTNs, comprised 18 percent (US$2.6 billion) of total investment inflows. The rest pertained to money market instruments and peso bank deposits (combined share of two percent). The United Kingdom, Singapore and the United States were the top countries of origin of investment inflows during the period.

Meanwhile, gross capital outflows for the period rose to US$10.9 billion or by 124 percent from last year. The outflows arose from divestments from listed shares (47 percent of total) and government securities (20 percent), as well as withdrawals of money market placements and peso deposits (33 percent).


1 These statistics, which pertain to newly registered investments, are different from foreign portfolio investments in the balance of payments which represent actual flows during the period under review.
2 Generally represent temporary placements of sales proceeds from divestments from listed shares and government securities.

Public sector posts P52.7-B surplus in Jan-September

By Iris C.Gonzales
Original article at The Philippine Star

The Philippines posted a consolidated public sector surplus in the first nine months of the year, sustaining the trend started last year.

Data from the Department of Finance (DOF) showed that the public sector attained a surplus of P52.7 billion as of end-September or 1.1 percent of gross domestic product (GDP).

From January to June, the public sector surplus stood at P24 billion, sustaining the P8.3 billion posted in the first quarter of the year and the P5.33 billion at the end of the year.

The government reported a surplus last year for the first time since the 1997 Asian financial crisis, swinging from a deficit of P103.54 billion in 2005.

The last time the public sector recorded a surplus was in 1996 at P7.5 billion.

The country’s consolidated public sector fiscal position is the combined budget deficits or surpluses of the National Government and state-owned firms.

These include government-owned or ‑controlled corporations (GOCCs), local government units and government financial institutions. It is closely monitored by local and foreign debt watchers as it is an indication of a country’s credit risk.

On the government corporate side, the 14 monitored GOCCs registered an aggregate surplus of P39.9 billion, data further showed.

“The surplus of the 14 monitored non-financial government corporations (MNFGCs) resulted from the buoyant receipts of the top three government corporations such as the National Power Corp. (Napocor), National Transmission Corp. (TransCo) and Power Sector Assets and Liabilities Management Corp. combined with lower than program capital expenditures for most of the corporations,” Finance Secretary Margarito Teves said.

Fiscal authorities have been implementing governance reforms such as the stringent review of GOCC requests for National Government support for net lending and tax subsidy and the tighter review and approval of NG guarantees for GOCC loans.

The GOCCs include National Power Corp., which has started posting surpluses last year after many years of losses, the Light Rail Transit Authority and the National Food Authority.

Government financial institutions (GFIs) posted an aggregate surplus of P8 billion while local government units posted a surplus of P28.6 billion. GFIs include the Land Bank of the Philippines and the Development Bank of the Philippines.

“The government financial institutions such as DBP, Trade and Investment Development Corp. (Tidcorp) and LBP made substantial gains in treasury-related transactions,” Teves said.

Social security institutions such as the Social Security System, Government Service Insurance System and the Philippine Health Insurance Corp. (Philhealth) posted a combined surplus of P40.1 billion as of end-September.

The Bangko Sentral ng Pilipinas (BSP), however, continued to incur a deficit, with P31.053 billion recorded as of end-September.

Filipino-Chinese consortium bags TransCo concession for $ 3.95 B

By Donnabelle Gatdula
Full report at The Philippine Star

A consortium of Filipino and Chinese firms led by local infrastructure holding firm Monte Oro Grid Resources Corp. bagged yesterday the concession contract for power grid operator National Transmission Corp. (TransCo) with a bid of $3.95 billion.

Monte Oro had teamed up with Calaca High Power Corp. and State Grid of China for the bidding, the country’s biggest privatization effort.


The consortium narrowly beat the $3.905-billion bid of the group of San Miguel Energy Corp. and partners Dutch firm TPG Aurora BV and Malaysia’s TNB Prai Sdn Bhd.

The Monte Oro group must still get a franchise to operate the grid from Congress, where opponents of Mrs. Arroyo in the Senate are likely to give them a rough ride amid allegations the winning consortium has close links to her.

“They (Monte Oro) have enough political clout to get it through the lower house but will likely run into a long-running tele-novella in the Senate,” said Alex Magno, director of the Development Bank of the Philippines.

The consortium has a year to get the franchise or ownership will revert to the government, which will continue to run the grid for the time being.

But Monte Oro’s president expressed confidence, saying their offer would be funded through a combination of equity and borrowing.

“We have agreements with underwriters and we will begin to implement them,” Walter Brown, who is also chairman of mining group Philex, said.

The government will get 25 percent of the purchase price once the franchise is awarded, with the remaining funds to be paid over 20 years.

“This is a move in the right direction,” said Jose Ibazeta, head of the agency tasked with selling state-run energy assets.

The winning price tag is more than double the previous privatization record of $1.6 billion paid for Fort Bonifacio in 1995 and crowns a turnaround in what had previously been a notoriously stop-start energy privatization program.

The government has been trying since 2003 to privatize the management of TransCo to boost state finances and modernize its creaking power sector. Yesterday’s auction was the fifth attempt and the second this year.

Political uncertainty and doubts about the predictability of profits tripped up previous sale efforts but a new tariff system for TransCo, in operation since last year, is supposed to make the 25-year license more lucrative for investors.

The grid, which needs about $725 million until 2010 for upgrades and expansion, was valued at P138 billion in 2006.

State Grid Corp is China’s largest electricity provider and is ranked 29th in the Fortune Global 500 list of the world’s largest companies by revenue this year.

World Bank support

The private investment arm of the World Bank has said it will give financial help of up to $250 million to the winning bidder.

The government had given four groups a green light to participate in the auction and 21 investors originally expressed interest.

A third group, led by holding firm Metro Pacific Corp., did not bid after their technical partner and investor, Italy’s Terna-Rete Electrica Nazionale, withdrew from the consortium at the last minute.

Proceeds from the sale will be used to pare some of the $6-billion to $7-billion debt at the state-run National Power Corp (Napocor), once the single biggest drain on state finances.

Napocor has already benefited from a string of recent power plant sales and Ibazeta said with the auction for Transco, the crown jewel of Philippine energy assets, the government had sold $6.6-billion worth of power assets since 2004.

The winning bidder did not join the press briefing held after the auction.

The Power Sector Assets and Liabilities Management Corp. (PSALM) said it would officially declare Monte Oro group as the winner 30 days from now, after another round of review is made on the submitted documents.

Though it backed out of yesterday’s bidding process, Two Rivers yesterday asserted that it was qualified to participate in the bidding.

“We deplore the attempts of certain parties to gain an unfair advantage – or distract attention from their own weaknesses – by calling into question our qualifications to bid for TransCo,” said Two Rivers president Jose Ma. K. Lim.

But Ibazeta believed that they have been very transparent and open in the bidding of TransCo.

“We are very happy about the successful turnout of the bidding exercise for TransCo. PSALM handled the privatization of the government’s transmission business with utmost transparency and judiciousness,” Ibazeta said.

“We strictly implemented the bidding procedures and complied with the rules governing the selection of today’s winning bidder,” he added.

Ibazeta acknowledged the support and assistance of other government agencies in the privatization of TransCo.

“We would not have gotten this far if not for the support of almost the entire executive branch of government,” he said.

Monte Oro Grid is a wholly-owned subsidiary of Monte Oro Resources & Energy, Inc. It was incorporated in the Philippines on Aug. 29, 2006 to invest and hold interest in shares of stocks of companies engaged or proposing to engage in infrastructure projects.

State Grid, on the other hand, represented enterprises and institutions formerly owned by the State Power Corp. of China. It was established to engage in transmission, transformation, and distribution.

Incorporated on Dec. 15 last year, Calaca High Power is involved in operating, managing, maintaining, and rehabilitating energy systems and services for gas, steam and electricity. Its major stockholder is Robert Coyiuto.

“To ensure the expeditious and smooth commencement of the concession period, PSALM will assist the concessionaire in preparing and submitting an application for a congressional franchise for the operation of the public utility,” Ibazeta pointed out.

“Our mandate is not simply bidding out and privatizing the generation assets and transmission, but ensuring that the interest of the Philippine government and its people is protected and upheld. We thank the bidders and appreciate their sustained interest and participation in this bidding,” the PSALM chief said.

PSALM’s privatization proceeds now total $6.6 billion, including those from the sale of 11 generation assets and the transmission business.


By Roel Landingin in Manila and Richard McGregor in Xianghe
Full report in The Financial Times


But it also marks the biggest foray overseas for State Grid, which though it is almost unknown outside of China, is one the country’s largest companies through its control of 80 per cent of the country’s power transmission assets.

Under its hard-driving, ambitious president and chief executive, Liu Zhenya, State Grid, which has also kept ownership of some generating assets, has increasingly sought out opportunities overseas.

It also has plans for an initial public offering that bankers say could take place as soon as 2008 and be worth as much as $20bn, although it has been delayed because of the need for extensive restructuring of the company.

Officials in the Philippines on Wednesday said State Grid’s bid, made with two local partners, underscores China’s strong commitment to invest in the Philippines in spite of growing public wariness of Chinese companies being awarded lucrative government contracts.


Owners of private power companies, who are increasingly worried that the government is not investing enough to expand and upgrade the Philippines’ power grid, welcomed the successful auction. “It will accelerate the capital expenditures needed to support the critical infrastructure of the National Transmission Co. (Transco),” said Ernesto Pantangco, president of the Independent Power Producers Association.

Wednesday, 12 December 2007

Govt employees to receive P10,000 performance bonus

Original report at ABS-CBN News

Government employees are set to receive P10,000 in performance bonus effective immediately, Press Secretary Ignacio Bunye announced Wednesday.

The announcement came after President Arroyo signed Administrative Order 213 Wednesday reportedly in recognition of the contribution of government personnel and the quality service they provide.

According to AO 213, the P10,000 performance bonus will be given to those employed by national government agencies, government-owned and-controlled corporations (GOCCs) and government financial institutions (GFIs).

Employees – hired on permanent, temporary, casual or contractual basis - who have rendered at least four months of service as of November 30 are eligible to receive the bonus in full.

Employees who have been in service for less than four months will also receive a bonus but on a pro-rated basis.

The order said GOCCs and GFIs that do not have adequate or sufficient resources may partially implement the benefit. With dzMM, ANC

Press Release: Medal Haul in Swimming Is Best Since 1991

Original report at
Last Updated: by rpsports_danny on 12/12/2007 3:09:00 PM

Click here for video from GMANews.TV.

NAKHON Ratchashima – They saw, they swam, and, oh, how they conquered.

At the end of the five-day 24th Southeast Asian Games swimming competitions Tuesday, Filipino swimmers garnered a grand haul of eight gold, three silver and seven bronze medals in their best outing yet since the 1991 Manila Games.

The Filipinos exceeded expectations, emerging as a force to reckon with by placing second overall behind dominant Singapore (11-9-6) while relegating swimming powerhouse Malaysia (7-8-8) to third.

Even host Thailand was lost in the wake of the gutsy Philippine performance and could only finish fourth (4-5-6) at His Majesty the King’s 80th Birthday Anniversary Aquatic Center.

Swimming also produced the country’s top individual performer in 23-year-old Miguel Molina, who won three individual golds – 200m breastroke, 200m and 400m individual medley – and in the 4x100 IM relays. In 2005, he won three golds in the same individual events.

The Filipinos also set one national record in the men’s 50-meter freestyle through SEAG rookie Daniel Coakley, whose winning time of 22.76 also earned him a slot to the 2008 Beijing Olympics.

The great grandson of Olympian Teofilo Ildefonso, Coakley made it a double celebration in anchoring the men’s relay team, breaking a 16-year drought in the event since Eric Buhain did the same with the RP quartet.

Powered by Buhain’s six-gold haul, the Pinoy tankers had an outstanding 10-3-5 output in 1991, which proved to be the summit for this sport that saw several lean years following that outing.

Shortly after the swimming association was taken over by former RP standout Mark Joseph, the sport once again showed signs of life as the locals fished out a 4-5-6 output in the 2005 SEAG.

Sharing relay honors with the Fil-Hawaiian Coakley were Ryan Arabejo, who earlier won two individual golds (backstroke), Molina (breast), and Fil-Am James Walsh (freestyle).

Walsh, a pre-med student at the University of Florida, showed he still has plenty to spare Tuesday evening a few minutes after winning the men’s 200-meter butterfly, with the help of the RP medical team led by noted chiropractor Dr. Martin Camara.

Head coach Pinky Brosas, the architect of the swimming team’s initial success in 2005, attributed the superb showing of his charges to meticulous planning, strategy, and lots of tender loving care.

“We were planning for this Games even after the 2005 SEAG. Even then that was a high level event and we knew our work was cut out for us,” said Brosas, who also mentored Buhain and Akiko Thomson in the late 80s and early 90s.

“Most of these swimmers were together in Manila two years ago so they knew each other. There were some newcomers. Being the senior ones, we made Molina and Walsh as their leaders,” Brosas said.

“With Miguel and JB (James) showing the way, we tried to keep a family atmosphere among the coaches and swimmers. We bonded together, we stayed loose and tried to make it fun,” he added.

Brosas, a 1972 Munich Olympics veteran, also said they had to make tough decisions for the overall good of the team, just like when the coaching staff decided to drop Kendrick Uy from the 100 free leg of the 400 IM relay in favor of Coakley.

“Everything we do here was to meet our team goals. Everyone understands his or her role and we are fortunate because of that.”

Arroyo to give cash gifts to SEA Games medalists - POC chief

Original report at GMANews.TV

A Christmas bonus awaits Filipino medalists in the ongoing 24th Southeast Asian Games in Thailand.

Philippine Olympic Committee president Jose "Peping" Cojuangco said Wednesday this was the assurance he got from Malacañang.

"I have been informed by Malacañang that President (Gloria Macapagal) Arroyo will give all of our Southeast Asian Games medalists bonuses, regardless whether they win the gold, silver or bronze," Cojuangco said in a report from the Philippine delegation.

Cojuangco made the declaration after watching swimmers from Team Philippines perform at the end of the championships.

"This should be good news for all of our SEA Games achievers. However, I was not informed how much they will be getting," Cojuangco said.

He pointed out that the cash gifts were on top of the regular incentives given by the government through the Philippine Sports Commission for SEAG medalists.

Under the scheme, an individual gold medalist gets P100,000; the silver is worth P50,000 and the bronze P10,000.

As of this posting, the Philippines has a total of 141 medals: 32 gold, 42 silver and 67 bronze.

2007 SEA Games Updates

RP's Catalan wins cycling gold despite hurting leg

Original report at GMANews.TV

Cyclist Alfie Catalan won the individual pursuit gold medal on Tuesday, the Filipino team's second in track cyclilng after Victor Espiritu topped in individual points race, the Philippine Cyling Federation (PhilCycling) reported Tuesday night.

Catalan, a favorite in the event, gave his fans a scare when he slowed down a bit in the last 400 meters of the race – because his legs hurt. But he pushed on to win the event, which held at the velodrome of the His Majesty The King's 80th Birthday Anniversary Main Stadium in Nakhon Ratchasima.

Catalan, who at 6-foot-1 hardly looks like a cyclist, finished in 4 minutes, 48.23 seconds, followed by Amir Mustafa Rusli of Malaysia in 4:49.594, and Projo Waseso of Indonesia in 4:50.870.

"Back-to-back na," Catalan, a 25-year-old native of San Manuel, Pangasinan, said after the race. "Para sa bayan, para kay Mr. and Mrs. (Bert) Lina at para kay Bheng (Aphrodite Alvarez, his girlfriend)."

Catalan also credited his victory to his brand new CSK pursuit bike, which was provided by the Philippine Sports Commission, although the bike only arrived two weeks before the Games.

"Tamang tama ang bike para sa event ko," Catalan said

PhilCycling said tha the bike, imported from Taiwan, costs P120,000, a modest amount compared to the European-made BT bike used by the Malaysian silver medalist, according to cycling head coach Jomel Lorenzo.

Baby Marites Bitbit, who won two bronze medals – one in cross-country and another in the individual time trial – went for the women's 30-km points race mint late Tuesday evening. -

RP cyclist gets gold medal, while everyone's getting into bed

Original report at GMANews.TV

No one saw it coming, except the coaching staff and the rest of Team Cycling Philippines, because the Philippines won its last gold for Monday (December 10) when almost everybody else was getting ready for bed.

Victor Espiritu had to nervously wait for almost an hour for the official announcement that he had clinched the gold medal in the men's 40-kilometer points race in track cycling, according to a report issued on Tuesday night by the Philippine Cycling Federation (PhilCycling).

That's because Thai cycling officials profusely questioned and meticulously reviewed and scrutinized the result of perhaps the most complicated cycling event – road, track, and mountain bike combined.

So when the stadium barker made the announcement in English that he had won the gold, beating two Thais, one of them Prajak Mahawong, the winner of road's individual time trial, Espiritu could only blurt oiut: "Waaahooooooh!"

PhilCycling president Bert Lina, who was there with wife Sylvia, could only sigh in relief.

"Muntik na," he said, referring to what might have been a lost gold had the commissaires' panel yielded to Thai pressure.

Espiritu earned the gold by garnering 88 points. Mohawang settled for silver with 83 points and another rider from the host team, Thanawat Somna, bagged bronze with 74 points.

It was a sweet moment for Espiritu because it took 10 years for him to earn his second SEA Games gold medal. And he achieved it through a brilliant strategy cooked up by the coaching staff.

"Totoo pala ang kasabihan na winning the second time is sweeter than the first time," said the 33-year-old Espiritu, this year's Padyak Pinoy champion.

Espiritu won a belated gold medal in the men's ITT in 1997 in Jakarta. He was second in the race, but Indonesian Tonton Susanto, who is also still racing in this edition of the biennial event, tested positive for banned substances.

The Navotas resident – he used to live in Malabon – earned a controversial silver medal in the 2003 Vietnam Games.

He missed the 2005 Manila edition because he was barred from competing by his professional team.

"Ang tagal kong hinintay to," said Espiritu.

And last Monday he did a lot of waiting.

He also had to endure for an hour and a half in the 120-lap race where a rider earns points – 5, 3, 2 and 1 – for each sprint and gets bonuses for overlapping a rider or riders and for topping the final sprint, which is worth 20 points.

The points race is the most unrelenting as all riders have to race at top speed all the time to avoid being overlapped.

Espiritu, in fact, was not supposed to compete in the points race. He was entered in the team pursuit, but head coach Jomel Lorenzo, a bemedaled track rider himself, thought otherwise.

"The coaching staff felt Victor had the better chance in the points race because of Steve (Pelaez) and Ronald (Gorantes). The points race is the specialty of Steve and Ronald," said Lorenzo.

Pelaez, who is credited for the team's battle cry, and Gorantes ably backed Espiritu. They finished ninth and 12th, respectively. "That precisely was the plan, for them to back each other," said Lorenzo.

The Thai fans were so disappointed at their bets' loss that they left His Majesty The King's 80th Birthday Anniversary Velodrome during the awards ceremonies. Only a handful of a handful of Filipinos from a local association in Thailand stayed behind to applaud Espiritu.

Pass these bills

The Manila Times

THE 14th Congress is taking its Christmas break without having passed a law it can take pride in during its first session. No wonder then that the Joint Foreign Chambers of Commerce of the Philippines are concerned about the quality of legislation (or the lack of it) since the start of the session last July.

Again much time was wasted in endless inquiries into random events. Even before they can warm their seats, senators have resumed their political vendettas. Not to be outdone, the House of Representatives, like clockwork, replicated this travesty.

The Joint Foreign Chambers identified seven out of 12 bills they deem urgent for approval. These include the Credit Information System Act, amendments to the Customs Brokers Act, the Land Administration Reform Act, the National Tourism Policy Act, the Personal Equity Retirement Act, the Renewable Energy Act, and the Simplified Net Income Tax Reform Act. Foreign businessmen in the country are also pushing for the enactment into law of a bill creating the Civil Aviation Authority and the bill providing greater access to affordable quality medicine.

Bills in limbo

Not surprisingly, many of these proposals have been pending before the legislature for years. Work however has dragged on from the 13th up to the present Congress. Indeed, many are what foreign businessmen called “ready-to-go” measures, in reference to the fact that they have already gone through countless hearings, with their drafts having gone through countless revisions to accommodate the flimsiest objection from the most marginalized interest group.

The seven bills the foreign businessmen are pushing separately would have wide-ranging effects on the economy and society. The Credit Information System Act aims to remedy imperfections in the financial system that have caused imprudent lending by banks, leading them to impose higher interest rates even on creditworthy borrowers just so the lender can offset losses from bad loans.

Centralized credit bureau

Imagine the “tax” these information asymmetries impose on all borrowers – be they of good or bad credit standing. For example, credit card companies charge on average two percent a month. That is tantamount to an interest rate of 24 percent a year. Good credit cardholders therefore are penalized for the sins of the few bad eggs. The bill aims to create a centralized credit bureau that would serve as a screening body for borrowers.

The Personal Equity Retirement Act is another economic reform measure. At the level of the individual, this bill would help create a culture of savings, thus building up his financial resources in preparation for eventual retirement. Coupled with an existing law that provides discounts to senior citizens, this bill would give those who have paid their dues to society greater purchasing power and allow them to enjoy the fruits of their years of labor.

Easing the tax burden

The Simplified Net Income Tax Reform Act aims to ease the tax burden on salaried employees, whose incomes are immediately captured by the system, by instituting measures to account for unpaid taxes of the self-employed and professionals. This would boost the government’s coffers, and provide it with more resources to pursue its programs.

The Renewable Energy Act is timely, as it is meant to cut down our oil import bill by jumpstarting the country’s alternative fuels industry and rejuvenating the farm sector. Amendments to the Customs Brokers Act are supposed to liberalize further the practice of customs brokerage, while the Land Administration Reform Act would rationalize land titling in the country, thus encouraging more investments into the property sector.

Bills address growth areas

Not coincidentally, some of these measures address problems plaguing what are seen as emerging growth areas in the economy. Passing these bills into law therefore would free up these potential growth sectors. Some of the pending bills are aimed at improving existing procedures that limit the potential of other industries.

What the Joint Foreign Chambers therefore are asking for is the return of a reform-minded Congress. The legislature has to regain its focus. The economy may be growing at a record pace right now. But sooner or later, this expansion would lose steam if the roadblocks the above bills are meant to address are not dismantled. This should give legislators something to ponder on during the Christmas break.

DBP’s $1-B hedging facility a boon to exporters

By Ted P. Torres
Original article at The Philippine Star

CAGAYAN DE ORO CITY – As the peso climbs to new seven-and-a-half year highs, the $1-billion hedging program offered by the Development Bank of the Philippines (DBP) is becoming more and more attractive to exporters.

The hedging program was introduced last month when the peso was trading at an average level of 46 to the dollar. Yesterday, the local currency closed at 41.40 to the greenback.

DBP president and chief executive officer Reynaldo G. David said exporters are now finding the hedging facility a safe haven from the weakening dollar; thus protecting their products.

The hedging program gives exporters the flexibility to manage their foreign exchange risk.

“Our hedging program is attractive in the face of a strong peso, after exporters somewhat dilly-dallied when the peso was still in the 46 range,” David said.

The state-run bank has so far covered $4.1-million involving about 35 transactions to exporters of seaweeds, textiles, furniture makers and food manufacturers.

DBP senior vice president Jose Gonzaga Jr. said the bank has been aggressive in providing the hedging facility particularly to exporters in Mindanao.

Exporters of banana chips, coconut fruit and castor oil from Davao have accessed the window. In Gen. Santos City, an aquaculture exporter has tapped the forward facility, as well as a carageenan exporter in Zamboanga City.

The most preferred hedging facility thus far is the forward foreign exchange rate protection, known as non-deliverable forwards (NDFs) with a one-month tenor.

The forward facility is a contract between the exporter and DBP, with no dollar changing hands. The entire amount of the contract is not settled but instead only the net difference between the contracted forward rate and the market rate upon maturity.

LEDAC vis-a-vis JFC



  1. 2008 national budget
  2. Measures for cheaper medicines
  3. amendment to the Electric Power Industry Reform Act (EPIRA) of 2001
  4. establishment of a credit information bureau
  5. amendments to the University of the Philippines charter
  6. magna carta for small and medium enterprises
  7. personal equity retirement fund
  8. agriculture competitiveness enhancement fund
  9. establishment of the Civil Aviation Authority of the Philippines

  1. Amnesty Bill
  2. JPEPA: two more hearings needed


  1. Credit Information System Act
  2. Customs Broker Act Amendment
  3. The Land Administration Reform Act
  4. National Tourism Policy
  5. Personal Equity Retirement Act
  6. The Renewable Energy Act
  7. Simplified Net Income Tax Reform Act

  1. Build-operate-transfer law amendments
  2. Fiscal Incentives Rationalization
  3. Freedom of Access to Information (as New Labor Code)
  4. Local Government Code amendment (re investment)
  5. Magna Carta for SME amendments
  6. Pre-Need Code
  7. Financial Sector Taxes Rationalization
  8. Foreign Investment Restrictions Rationalization Act
  9. Foreign Professional Partners in Development Act

  1. Creation of the Civil Aviation Authority
  2. Affordable Quality Medicines Bill

Suggestions to Electric Power Industry Reform Act (Epira) which will allow more access and competition, the group is strongly questioning the need to amend the 70-percent threshold provision of the law which must be met before open access can commence.


  1. National Budget Bill--Appropriating funds for the operation of the government from January to December 2008, and for other purposes.
  2. Amnesty Proclamation—This is the government’s latest step towards the attainment of peace and reconciliation in the country. Proclamation No. 1377 grants amnesty to members of the Communist Party of the Philippines (CPP), New People’s Army (NPA) and the National Democratic Front (NDF) and other communist rebel groups.
  3. Agricultural Competitiveness Enhancement Fund (ACEF) Extension—Provides for the extension of the utilization period of the ACEF until 2015 to coincide with the expiration of the Agricultural and Fisheries Modernization Act (AFMA).
  4. Creation of the Civil Aviation Authority—Provides for the creation of the Philippine Civil Aviation Authority, its powers and functions and organizational structure.
  5. Establishment of the Personal Equity Retirement Account (PERA) –Aims to provide people with a savings plan for their retirement years. It encourages savings mobilization, promotes capital market development and generates investments.
  6. Credit Information System--Provides for the creation of a Credit information Bureau which shall have the power to collect and disseminate credit-related information and maintain the credit history and track record of borrowers.
  7. Amendments to EPIRA Law to allow more access and competition which proposes certain amendments to Republic Act No. 9236 (Electric Power Industry Reform Act) in order to achieve open access and allow more competition and choice to end-users including households consumers.
  8. Amendments to the Customs Brokers Act – Prohibits corporations from engaging in the business of customs brokerage or from hiring the services of an in-house customs broker for purposes of accreditation by the Bureau of Customs and facilitation of customs brokerage activities.
  9. University of the Philippines (UP) Charter amendments—Seeks, among others, to: a) create a University System Council; b) distribute functions of governance to the Board of Regents, the University President and other administrators and the University Council.
  10. Cheaper Medicines Bill which will impose price regulation on medicines and amend certain provisions of R.A. 8290, otherwise known as the Intellectual Property Code of the Philippines.
  11. Amendments to the Magna Carta for Small and Medium Scale Industry--The bill seeks to expand the coverage of the Magna Carta for Small Enterprises to include the micro-enterprise sector.

LEDAC supports nine bills

Senate approves P1.277-trillion budget for 2008
Education, public works, security get budget priority


President Arroyo yesterday got lawmakers to agree to pass at least nine priority legislations, including the 2008 national budget and a measure to reduce electricity rates, before Congress goes on a Christmas break.

However, during the Legislative Executive Development Advisory Council (LEDAC) meeting, the legislators appeared lukewarm to the administration’s proposed amnesty for communist rebels, citing lack of time.

Also yesterday, the Senate passed on third and final reading the General Appropriations Act or the R1.277 trillion national budget for 2008.

The Senate approved the budget with higher allocations for education, infrastructure and national security.

Fresh from her trip to Europe and Kuwait, the President renewed her pitch for the amnesty program and other priority measures before Congress ends its session on Dec. 21 at the high-level meeting in the Palace.

Emerging from the LEDAC meeting, Sen. Miriam Defensor-Santiago said they agreed to work on nine priority administration bills in the remaining six session days of Congress.

These are the proposed 2008 national budget and measures for cheaper medicines, the amendment to the Electric Power Industry Reform Act (EPIRA) of 2001, the establishment of a credit information bureau, amendments to the University of the Philippines charter, the magna carta for small and medium enterprises, the personal equity retirement fund, the agriculture competitiveness enhancement fund, and the establishment of the Civil Aviation Authority of the Philippines.

Santiago said they had to cut the long list of administration measures to accommodate the first batch of priority bills before Congress adjourns this year.

"There are many pet bills and there are many critical and strategically important bills but we have to limit ourselves to what is possible. There are only six working days left," told reporters in the Palace.

Sen. Edgardo Angara said they also promised to exert "best efforts" to pass the proposed amnesty proclamation for communist rebels before the end of the year.

Angara said lawmakers are running out of time to approve the amnesty bill, which was given an initial funding of P500 million from the President’s social fund.

He said if the legislature could not pass the amnesty bill this month, the passage of the measure in January is "still good."

He explained that lawmakers still have to clarify "some outstanding issues" concerning the implementing rules and regulations (IRR) of the amnesty measure for communist rebels.

"We need the IRR. There are concepts that need to be clarified such as definition of political offense, coverage and funding for the social integration," Angara told reporters.

The controversial Japan-Philippines Economic Partnership Agreement was not included on the administration priority list for 2007 during the LEDAC meet.

Santiago said the Senate will hold two more hearings aimed at addressing constitutional issues in the trade accord between Manila and Tokyo.

At the same LEDAC meeting, the House of Representatives also expressed commitment to complete the passage of five or six legislations before they adjourn for Christmas holiday.

House Speaker Jose de Venecia Jr. said they will fast track the approval of the 2008 national budget, agriculture competitiveness enhancement fund, amendments to the University of the Philippines charter, civil aviation bill, and the amnesty proclamation for communist rebels.

"I have complied with my commitment that there will be no discussion of Charter change bill or resolution in 2007 and I have kept my peace and I have kept my promise," De Venecia told reporters in a separate interview.

Senate approves P1.277-trillion national budget

After three weeks of marathon hearings, the Senate passed on third and final reading yesterday the General Appropriations Act or the R1.277 trillion national budget for 2008.

The Senate approved the budget with higher allocations for education, infrastructure and national security.

Topping the list of recipients for the 2008 national budget allocations are the Department of Education (DepEd) with P138 billion, followed by the Department of Public Works and Highways (DPWH) with P90.72 billion, and the Department of National Defense (DND) with P50.9 billion.

"The early passage of the budget mirrors our resolve to set fiscal directions for 2008 in pursuit of a meaningful program addressing the needs of our country and citizens," said Senate President Manny Villar.

Meanwhile, P26.8 billion was allocated to the Department of Agriculture (DA); P19 billion to the Department of Transportation and Communication (DOTC), P16.5 billion to the Department of Health (DoH), P10.6 billion to the judiciary and P10.18 billion to the Department of Foreign Affairs.

In the budget for education, P2 billion would be used for the repair of school buildings, P760 million to cover the shortage of classrooms, P420 million for school seats, and P330 million to hire new teachers.

The DOH was given a budget increase for the prevention and control of infectious diseases.

The Senate raised the budget of the Office of the Solicitor General by P81 billion for the implementation of reforms instituted by law in their structure and organization.

The Senate approved P557.033 million for the Bureau of Jail Management and Penology (BJMP), allowing a subsistence stipend of P60 per day per prisoner and P83.55 million medical allowance or P3 per day.

The Upper Chamber augmented the budget for state colleges and universities by P163.57 million for research and development and new academic programs.

The judiciary got an additional P250 million for the strengthening of its judicial system, additional judiciary incentives and to give citizens better access to lawyers.

Villar congratulated Sen. Juan Ponce Enrile, chairman of the committee on finance, and its for the early approval of the national budget.

"This should also put an emphasis on our call for the strictest accountability of government funds which must serve their rightful purpose," he said.

The bicameral conference committee is set to thresh out differing provisions of the bill before submitting the final version to Malacanang.

Participating in the bicameral meeting are Enrile and Senators Jinggoy Estrada, Pilar Juliana Cayetano, Edgardo Angara, Joker Arroyo, Miguel Zubiri, Aquilino Pimentel, Panfilo Lacson, Loren Legarda, and Mar Roxas.

Meanwhile, Villar recommended a zero budget for the Optical Media Board (OMB), headed by actor Edu Manzano, for its "lackluster performance."

"Lackluster performance in solving piracy can be seen in our continued inclusion since 2001 in the international watch list of countries violating intellectual property rights," Villar said.

Once approved by Congress, a zero budget effectively abolishes the OMB.

Villar said he is not inclined to support the P25.2 million budget for the agency next year.

"We are yet to see big fishes prosecuted for counterfeiting. The persisting presence of piracy dens in the country creates an atmosphere of lawlessness and does not help improve the investment climate," the senate president said.

As this developed, the LEDAC has agreed to study the proposal of Sen. Manuel "Mar" Roxas II to limit dollar loans to amortize maturing foreign debt and curb the rapid rise of the peso.

"We sought urgent action from the executive branch to increase domestic demand for the greenback, and in effect, buffering the peso’s steep climb which has been hurting our OFWs, exporters, BPOs and tourism industry. I’m thankful that President Arroyo heard us out," Roxas said.

He said Finance Secretary Margarito Teves is considering implementing the proposal.

Roxas had warned that the economy is in "danger of stalling" with OFWs and exporters suffering an income reduction of 20 percent because of the strengthened peso.

"The remittances of some of our eight billion OFWs every year is $ 12 billion or $ 1,500 per OFW. If they were earning P76,500 last year, now it’s only P61,500—less P15,000 which they can use to pay for their child’s school expenses or electricity," Roxas said.

Tuesday, 11 December 2007

Willy Wang in Wushu

In Doha, 2006

In 2005

PAL’s amazing turnaround

By Alito L. Malinao
Original report at The Manila Times

TWO weeks ago, the ninth Airbus A320-family aircraft was delivered to the Philippine Airlines, a clear signal that the once ailing airline is ready to soar to new heights, literally, after it formally moved out of receivership in early October.

The latest delivery was part of the 20 brand-new single-aisle jets that PAL has ordered from the European aircraft manufacturer and other airplane leasing companies.

In Dec. 2008 when the airline’s refleeting program is completed, PAL will be the first airline in the world to operate a full-range of new generation Airbus aircraft consisting of A320s and the wide-bodied A-330s and A-340s. On top of that, the first of six B777-300ERs that PAL has ordered is also expected to arrive in 2009.

PAL is indeed is on its way to full recovery. Some business analysts have even described PAL’s amazing turnaround as a “corporate miracle.” And the airline’s performance during the past years will bear this out.

Despite the net loss of $11.8 million from July to Sept. 2007, the airline still managed to earn a sizeable profit of $22.7 million for the first half of its 2007-2008 fiscal year.

From April to Sept. 2007, the first half of its fiscal year, PAL posted revenues of $727.4 million against expenses of $704.7 million. The resulting net income of $22.7 million was 107 percent over—or more than double—the $10.9 million profit earned in the same period in 2006.

Biggest profit

During the last fiscal year that ended on March 31, 2007, PAL reported a net income of $140.3 million, the largest profit in its 66-year history.

In 2006, the airline reported profits of $28.7 million, the first time since 1993 that the airline had a surplus exceeding $20 million, when it booked US$40.5 million. PAL is forecasting net profit to reach $32.32 million for the fiscal year that would end in March 2008, $26.28 million for fiscal 2009 and $47.41 million in 2010.

The flag carrier recently emerged from eight years under receivership in robust condition, having posted operational profits for eight straight years and a net income for six of those years

How would this latest development affect the operations of PAL?

Graduating from receivership would mean a number of positive changes in the country’s flag carrier. It would lower financing cost, improve financing terms and better access to capital markets.

Already the PAL management had embarked on an ambitious road show across Asia, Europe and North America to drum up interest in a limited offering of shares of PAL Holdings, Inc., the airline’s parent company.

The infusion of new capital would in turn provide greater flexibility to PAL as it seeks to modernize its fleet, expand its services and venture into new markets.

Because of its remarkable performance during the last eight years, the Sydney-based aviation industry analyst and consultant
Centre for Asia-Pacific Aviation (CAPA) has bestowed on PAL the prestigious “Airline Turnaround of the Year” award.

In giving the award, CAPA executive chairman Peter Harbison said that few airlines have reformed themselves so comprehensively as PAL. “An unflinching cost focus, network focus and superb productivity enhancements have provided Philippine Airlines the platform to profitably expand and establish a strong position in the region’s aviation industry,” he said.

People behind

Some 10 years ago, when everybody has written off PAL as beyond saving after years of mismanagement and labor strife, there was one man who saw it differently. With his keen business acumen and raw grit, industrialist Lucio C. Tan, PAL chairman and CEO, went for the jugular and infused $200 million into the airline. This started the long and arduous rehabilitation of PAL, which eventually bore remarkable results.

After Tan, the second person that should be credited for the airline’s strong rebound is PAL president and COO Jaime J. Bautista. It was under Bautista’s watch, first as executive vice president and later as president, that PAL rose from the ashes, like the proverbial phoenix, to become a profitable airline.

Bautista is a certified public accountant. In PAL, he has held the positions of senior vice president for finance, later as executive vice president and chief operating officer. He was elected president and COO in August 2004. For a brief period, from March to August 2004, Bautista was president and CEO of Air Philippines, also owned by Tan.

Among the other positions currently held by Bautista are: chairman and president of Basic Capital Investments Corp. (since June 2001); president of Cube Factor Holdings, Inc. (since March 1992); president and member of the Board of Trustees of the University of the East (since July 2002).

Money for medals

By Ernesto F. Herrera
Original article at The Manila Times

AS of this writing, we are placing fourth in the Southeast Asian Games, with Thailand the runaway winner in the medals standing. No one really expects to beat Thailand on its home turf. It has dominated every single SEA Games it hosted since 1985.

I do wish we could have at least given the Thais a close race though. We had all the incentive to do so. In 2005, when we hosted the games, former Thai PM Thaksin Shinawatra accused us of cheating. We won the SEAG crown anyway, thanks to a deluge of golds on the last day of the competition, which gave the nation an early Christmas present. But Thaksin’s accusation of games-rigging, though unfounded, still rankles. A (close) no. 2 finish in this 24th SEAG would at least prove we are real contenders even away from home.

With a P50 million budget for the SEAG though, one expects modest if not realistic hopes. A few months ago, Philippine chief of mission Monico Puentevella was indeed talking about placing second behind Thailand but, really, with just a P50 million budget for sports?

Coming in third, fourth or fifth is not a crime but talking big about medals when we’re not backing it up with the proper funding for sports programs is deceitful. Of course, money doesn’t necessarily win medals, but it does play a big part in helping athletes become the best they can be.

We can say our athletes really prepared and worked hard and therefore they should win the gold, but that’s wishful thinking, because what do you think the competitors from other countries are doing? Prancing around on the beach, chugging beer?

Let’s not make excuses. The government regularly fails to allocate money for Philippine sports. I made a point about this during the last SEAG when one government official after another wanted to bask in the glory of our athletes’ victory, which was a miracle indeed considering the meager budgets they were allocated.

I expected that after the SEAG victory our athletes and coaches would at least have been rewarded with more funding. I mean, you can heap praises and honors on the athletes as much as you want but, in the end, how do you truly show your appreciation?

The real and much more appreciative demonstration of gratitude should come in the form of funding. Scrap their shoestring budgets and show them the money, as the famous line from the movie Jerry Maguire says.

Action speaks so much louder than words. The government must put its money where its mouth is. More money should be pumped into our various sports programs so that we could have a fighting chance, not only in the SEAG but when pitted against the world-class standards of the Asian Games or the Olympics. The government must invest more money to increase grassroots participation in sports, more money to get more people participating, to fund coaches, to increase athletes’ allowances, to improve sporting facilities and help with the identification and development of talented youngsters.

Our public officials are always eager to acknowledge sports’s role in nation-building, and are as quick as sprinters when sharing credit for medals won in international sporting events. But they are also notorious for peso-pinching athletes, coaches and their sports programs.

The government’s excuse is always it doesn’t have the money to spend on sports and therefore it has to rely on the private sector for support. That is not necessarily true because we have seen where and how money is suddenly found and spent, particularly in this administration. Hundreds of millions are lost on shady deals, and yet we are hard-pressed to find P250 million for out contingent to the Beijing Olympics in 2008. Come on, who are we kidding?

Every time we compete in international events we hope for the best. In the Olympics, the government even dangles millions for bronze, silver and gold medals won. But that money should have been made available prior to the competition, when the athletes were preparing, when they were working hard to earn their place in the sun. Dangling P5 million for an Olympic gold when you did not provide the money to prepare athletes by giving them the proper training, by sending them to exposure and competition events, by giving them the best coaching, the best facilities and equipment, is downright duplicitous.

If our athletes perform below potential, there must be accountability, but not just from the athletes, but from the government who sent them unprepared.

Palace, Congress to review priorities

Original report at BusinessWorld

THE LEGISLATIVE-EXECUTIVE DEVELOPMENT ADVISORY COUNCIL (LEDAC) will meet today to revisit the administration’s legislative agenda and formulate strategies to fast-track its approval.

Congress has yet to pass most of the bills in the Executive’s wish list but the Palace remains optimistic that the House of Representatives and the Senate will act on the measures, described as necessary to promote development and enhance the country’s competitiveness.

Today’s LEDAC meeting, Cabinet Secretary Ricardo L. Saludo said, "would discuss the urgent bills and the amnesty for rebels. We hope Congress would pass them."

He particularly cited the need to pass the 2008 budget so that the government would not be forced to operate on a reenacted outlay. Next year’s budget was approved by the House last November 12 and is still being deliberated at the Senate.

The amnesty for communist rebels, meanwhile, embodied in Proclamation 1377, was signed by the President in September and requires the concurrence of Congress.

House majority leader Arthur D. Defensor said the LEDAC meeting would reassess the list of priorities, with changes possible depending on current requirements.

"It (incorporating changes) depends on our situation, market forces and other things," Mr. Defensor said in a separate phone interview.

"We will also consider our current needs. For example, we need to hasten the passage of the cheaper medicines bill and the budget because the people are waiting for them."

The cheaper medicines bill, which relaxes patent laws to enhance access to lower-priced drugs from other countries, was approved by the Senate last November 5 and is undergoing plenary discussions at the House. It was certified as a priority in the last Congress but was bypassed due to the House’s failure to muster a quorum.

Mr. Defensor also said the House would pass around 15 bills before yearend.

These include the cheaper medicines bill, amendments to the Ombudsman Act, Credit Information System Act, amendments to the customs brokerage law, the One Billion Trees Act, Land Administration Reform Act, Renewable Energy Act, bills on the rationalization of the financial sector and fiscal perks, Simplified Net Income Taxation Act, amendments to the judiciary law on retirement, and the Amnesty Law.

Bills already approved, he said, are the 2008 budget, extension of the Agricultural Competitiveness Enhancement Fund (ACEF), and the bill creating the Civil Aviation Authority.

Mr. Defensor said House legislators are now waiting for Senate approval of these measures so that bicameral conference committees can be convened to reconcile differences.

Senate President Manuel B. Villar, Jr., meanwhile, said the chamber would likely pass nine bills before the Christmas break. This will follow the Senate’s approval last week of the Human Rights Compensation Act and the Personal Equity and Retirement Account (PERA) measure.

Expected to be approved are the Credit Information System Act; ACEF extension; amendments to the University of the Philippines (UP) charter, World Health Day Act, additional perks for firemen and the police; World War II Veterans Assistance Act; fixing the armed forces chief’s term; a measure professionalizing the Armed Forces of the Philippines; and another increasing the hazard pay of soldiers.

In the last LEDAC meeting in August, Malacañang identified priority measures categorized under the general areas of economic progress, educational reform and social equity, and peace and order and rule of law.

A little over half of the 16 priorities that fall under economic progress were carried over from the previous Congress: approval of the Japan-Philippines Economic Partnership Agreement, simplified net income taxation, fiscal incentive rationalization, credit information system, PERA, tourism policy, amendments to the customs brokerage law, ACEF extension, and the renewable energy resources measures.

The rest comprise the 2008 national budget, Electric Power Industry Reform Act amendments, creation of the Civilian Aviation Authority, a national strategy to conserve resources and help arrest climate change, the land use act, an anti-trust measure, and the promotion of infotech entrepreneurial ventures.

Eight measures, meanwhile, were identified as necessary to advance social justice, led by the cheaper medicines bill and amendments to the UP charter, both of which were not passed by the last Congress.

Others are long-term care for senior citizens, a poll watchdog fund, stiffer penalties for election violence, farmland as loan collateral, reversal of the devolution of district hospitals, and a review of the agrarian reform law, Agriculture and Fisheries Modernization Act, and the Agri-Agra Law.

To promote peace and order, four priority bills were named: witness protection, special courts for political killings, stiffer penalties for such killings and harsh penalties for rogue soldiers.

Last month, President Gloria Macapagal-Arroyo said she would convene LEDAC after a European trip to accelerate the approval of the priorities and to resolve whatever impediments that hinder their passage. — with reports from A. K. K. Austria and C. S. S. Valencia

Foreign chambers urge passage by Congress of 7 ‘ready-to-go’ bills

By Max V. de Leon
Original report at The Business Mirror

THE Joint Foreign Chambers (JFC) called for the immediate passage of seven bills, which they label as “ready to go” for their non controversial nature.

In a statement, the JFC also pushed for the approval of 10 more measures belonging to their list of “next-to-go” bills.

Those dubbed as the “ready-to-go” measures are the Credit Information System Act, which is foreseen to improve SME access to credit while reducing the cost of bank lending, improving lenders’ performance and promoting financial discipline among borrowers; the Customs Broker Act Amendment, which will remove the prohibition on corporate practice of customs brokerage;

The Land Administration Reform Act, which will address the current inefficient practice of land titling and lead to increased investment, reduced corruption and a stronger banking system; the National Tourism Policy; the Personal Equity Retirement Act, which will encourage millions of Filipinos, both here and working abroad to save for retirement, and will make more financial resources available to build the domestic capital market;

The Renewable Energy Act; and the Simplified Net Income Tax Reform Act, which they said will increase the inclusion of self-employed and professionals in income-tax collection.

Believing that these bills are not controversial, the JFC and other groups said these measures should be quickly approved.

They are also endorsing 10 other “next-to-go” legislative measures, namely, the build-operate-transfer law amendments, the Fiscal Incentives Rationalization, the Freedom of Access to Information (as New Labor Code), the Local Government Code amendment (re investment), the Magna Carta for SME amendments, the Pre-Need Code, the Financial Sector Taxes Rationalization, the Foreign Investment Restrictions Rationalization Act and the Foreign Professional Partners in Development Act.

These bills were included in their list of National Competitiveness Investment Climate Legislation in the 13th Congress.

The JFC also gave their comments on several other legislative measures on the Legislative-Executive Development Advisory Council (Ledac) Common Legislative Agenda for the 14th Congress.

In the amendments to the Electric Power Industry Reform Act (Epira) which will allow more access and competition, the group is strongly questioning the need to amend the 70-percent threshold provision of the law which must be met before open access can commence.

They are urging the government to maintain current policy at a time when its power-privatization program has become highly successful and the 70-percent threshold is likely to be met in 2008.

“Investors prefer policy consistency,” the JFC said.

The foreign chambers also aired their full support for the creation of the Civil Aviation Authority, which will help the local sector comply better with international aviation standards, and the Affordable Quality Medicines Bill which is expected to improve access to high-quality and affordable medicine.

For the Ledac meeting scheduled today, the group is encouraging members of Congress to agree on early target dates for the enactment of these measures before it goes on recess for the holidays.

Anti-Poverty? How about Pro-Middle Class?

By Dr. Romulo A. Virola
Secretary General, NSCB

We all know that the overarching goal of our development efforts is to reduce poverty. Toward this end, many programs and policies have been formulated, implemented and monitored over the years. Surely there are improvements here and there, but the pace of progress just does not seem fast enough. In fact, per the MDG monitoring by the NSCB, we only have a medium probability of attaining our target to halve poverty by 2015! Why? Is something wrong with the implementation of these programs or are our poverty reduction strategies simply ill-conceived?

See the rest of the article here:

RP athletes in SEA Games to get additonal allowances from PSC

Original report at Sun.Star

Philippine Sports Commission (PSC) Chairman William "Butch" Ramirez came home to the country over the weekend to facilitate the release of $40,000 additional allowance for the national athletes competing in the 24th Southeast Asian (SEA) Games in Thailand.

"I just came back for the additional allowance of the athletes. We have our President (Gloria Macapagal Arroyo) to thank for this," Ramirez told Sun.Star Davao.

The additional allowances will help boost the Filipino athletes' morale as they play to defend the crown they won in the 2005 Philippines SEA Games.

"This just shows how our government does its part in this endeavor. That's why I maintain my advocacy to the national sports associations (NSAs) and athletes to also give ther best," Ramirez said.

Before leaving for Thailand, the PSC chief told reporters that with the P100 million budget for the Games, they will not go there to be second.

"We will fight to win. We should not settle for less. Nobody goes to a competition to be second but to win. That's the kind of spirit I want to see from our athletes and officials no matter what really happens in Thailand," Ramirez said.

When asked to comment about the country's present standing in the Thailand SEAG, he replied: "We are now picking up."

Meanwhile, Ramirez confirmed that the President had appointed Eric Loretizo, a journalist, as new commissioner replacing Leon Gonzalo "Binggoy" Montemayor.

"The new commissioner is very hardworking. He had formed part of the successful staging of the Bacolod Southeast Asian Games in 2005," Ramirez said.

Loretizo was sports editor of the Visayan Daily Star based in Bacolod City. He also handled the media affairs of Representative Monico Puentevella, who is the chief of mission of the RP delegation in the SEA Games.

There are now two commissioners from Bacolod. The other is Richie Garcia.

"Appointing another commissioner from Bacolod is the President's prerogative. Nobody complained that there were two of us then from Davao," Ramirez said.

The PSC chief said he will return to Bangkok with the allowances for the athletes.

Ramirez was also set to hold a press conference before the Manila press Monday.

RP Oct exports up 10.5% as electronics recovers

Media Release
National Statistics Office
Full report at

Export earnings in October 2007 went up by 10.5 percent to $4.648 billion from $4.207 billion in October 2006. This may be due to the increase in the outward shipments of coconut oil and electronic products particularly the components/devices (semiconductors) and consumer electronics.

Compared to the previous month's level, export revenue grew by 6.3 percent from P4.373 billion.


Accounting for 61.8 percent of the aggregate export revenue in October 2007, Electronic Products posted an increase of 9.4 percent to $2.873 billion from $2.627 billion in October 2006. Compared with the previous month's level, an increase of 8.2 percent from P2.656 billion was noted. The year-on-year growth is due to the increase in the outward shipments of all electronic products except for electronic data processing, telecommunication and communication/radar.

Despite its continued decline in the aggregate receipt by 18.8 percent to $187.93 million from $231.33 million in October 2006, Articles of Apparel and Clothing Accessories is still the country's second top earner with a 4.0 percent combined share of the total exports.

Cathodes and Section of Cathodes of Refined Copper ranked third with total revenue of $152.47 million, an increase of 17.0 percent from $130.30 million in October 2006.

Coconut Oil ranked fourth with sales amounting to $107.92 million or a growth of 128.4 percent from $47.26 million in October 2006.

Petroleum Products ranked fifth with export receipts of $99.08 million or a year-on-year growth of 43.1 percent from $69.22 million in October 2006. This is due to the increase in the shipments of other fuel oils.

Rounding up the list of the top exports for the month of October 2007 were Woodcrafts and Furniture, with export revenue of $91.43 million or 4.7 percent increase from the same month in 2006; Ignition Wiring Set and Other Wiring Sets Used in Vehicles, Aircrafts and Ships (consisted only of electrical wiring harness for motor vehicles), $82.99 million or a growth of 5.9 percent; Other Products Manufactured from Materials Imported on Consignment Basis, $57.05 million or a decrease of 27.6 percent; Metal Components with proceeds billed at $42.77 million or a growth of 5.5 percent; and Bananas (Fresh), $29.60 million or a decline of 6.9 percent.


Accounting for 84.0 percent of the total receipts, export of Manufactured Goods was $3.905 billion, or 7.5 percent growth from $3.634 billion in October 2006.

All Agro-Based Products with a 5.2 percent share of the total export receipts generated a combined income of $243.43 million, up by 51.0 percent from $161.26 million in October 2006. This is due to the increase in the shipments of coconut oil.

Earnings from Mineral Products reached $270.43 million or 5.8 percent share of the total export revenue, recording a 25.9 percent increase from $214.88 million in October 2006.

Petroleum Products likewise increased by 43.1 percent to $99.08 million from $69.22 million in October 2006.

Export receipts of Special Transactions posted an increase of 1.7 percent to $128.05 million from $125.87 million in October 2006. Meanwhile, exports revenue of Forest Products went down by 16.2 percent to $1.82 million from $2.18 million in October 2006.