Friday, 9 January 2009

Philippine automotive sales up 6% last year

By Ma. Elisa P. Osorio
The Philippine Star

Sales of the local automotive industry grew by six percent last year despite the slowdown in vehicle sales seen in other markets like the US and Europe, the Chamber of Automotive Manufacturers Association of the Philippines Inc. (CAMPI) said.

“Elsewhere in and around the world, the auto markets of developed countries experienced steep declines due to the credit crunch coupled by deteriorating consumer confidence in those respective markets. Thankfully, there is enough liquidity in the local Philippine financing environment with consumers able to take out loans for their personal and business needs,“ Elizabeth H. Lee, CAMPI president, said.

Philippine election body to get P8 billion for poll automation

By Mayen Jaymalin and Aurea Calica
The Philippine Star

MANILA, Philippines -- The country’s elections chief is confident of getting at least P8 billion for poll automation in 2010.

“Malacañang is working on the request for a supplemental budget, which it will submit to Congress for approval,” Commission on Elections Chairman Jose Melo told reporters yesterday.

He said the proposed budget for poll automation was not included in the 2009 budget because it took the poll body’s advisory council a long time to decide on which technology to use for the 2010 elections. The original proposed budget was more than P13 billion.

“The decision of the advisory council came in December, which was way too late because the Palace had already submitted a proposed budget as early as August,” Melo said.

“The decision is even too late for the Palace to immediately request for a supplemental budget,” Melo pointed out.

He also dismissed insinuations that Malacañang was delaying the submission of the request for supplemental budget to halt the computerization project as well as the 2010 presidential elections.

Despite the delay in the release of the supplemental budget, Melo said the Comelec is still on track in its preparations for the poll automation.

“Our time line has not been distorted and I believe our absolute deadline for the budget is still the end of March,” Melo said.

He said the release of the budget should be no later than March to give the Comelec sufficient time to prepare the bidding process.

“It’s the bidding process that will really take months to undertake. The other procedures we can easily do. We are optimistic that we can still do it because Congress and the President are committed to it,” Melo noted.

“We cannot step back, we are not throwing in the towel in implementing poll automation,” he added.

Palace urged to act swiftly

For Sen. Richard Gordon, President Arroyo should submit the proposed supplemental budget to Congress as soon as session resumes on Jan. 19 to dispel speculation that she does not want the elections to push through in 2010.

“There are a lot of rumors circulating that the supplemental budget for poll automation has not been released apparently because of Cha-cha or President Arroyo extending her term,” Gordon said.

“But all of these accusations would dissipate once people see that the government is really working to have honest, speedy and reliable elections through the automation of the electoral system,” he added.

Senators have been urging Mrs. Arroyo to leave a legacy of clean and honest elections as she herself was accused of cheating her way to victory in 2004. She is also being accused of preparing to remain in power beyond 2010 through Charter change.

Gordon, author of the Amended Automated Elections Law, said the budget department should now prepare to submit to Congress the supplemental budget for poll automation, especially after the Comelec said that it had already submitted the P13.9-billion proposal.

He explained that while there was still enough time to automate the 2010 elections, it would be best to start immediately to ensure that everything would be well laid out – from the voting machines to teachers’ training to voters’ education.

Gordon also said the Comelec should prioritize automating the elections more than anything else because a computerized voting and counting system would avert “wholesale cheating” which is very common in manual elections.

“The priority should really be the computerized elections because with automated elections we could avert wholesale cheating, which happens with vote padding and shaving. That could be prevented because voting and counting would be fast with an automated system,” he said.

Fool-proof machines

For her part, Sen. Loren Legarda said the Comelec should make sure the machines for poll automation would be fool-proof otherwise the system would be “next to useless.”

Legarda, who ran for vice president in 2004, claimed she was cheated when she lost to fellow broadcast journalist Noli de Castro.

She said she was concerned about Melo’s admission that the optical mark reader (OMR) technology which the Comelec was proposing to use in the 2010 national elections would not be able to flush out double or multiple registrants.

“In short, flying voters will have a field day running rings around this system for which the Comelec had asked for P13.9 billion in supplemental budget,” Legarda said.

“We cannot have a computerized poll system that can count votes, but which cannot determine whether the votes being counted are authentic or fraudulent,” she added.

Melo was quoted as saying that the system would need cross-matching machines that could identify voters with double or multiple registrations.

The requested budget does not cover funds for cross-matching machines.

Legarda said that without the capability to weed out bogus votes, the system the Comelec wanted to use would only result in a “garbage in, garbage out” situation.

She reiterated that the very essence of employing a computerized system was to guard against poll fraud.

The Comelec earlier chose the OMR system although it had tested another technology – the direct recording electronic system or DRE – which does not only count votes faster but is also capable of identifying voters through biometrics, thus weeding out double registrants.

Melo said the OMR is cheaper than DRE.

But Legarda said the intention to save on cost was misplaced and that the Comelec could not ask voters to make up for the weakness of the OMR by asking them to squeal on flying voters.

Philippines issues 2009 holiday list

A. D. B. Romero
BusinessWorld Online

A LIST of regular and special non-working holidays for 2009 was released yesterday by Malacañang, providing guidance to businesses and institutions planning for the year.

Palace officials, however, said the schedule — contained in Proclamation No. 1669 signed by President Gloria Macapagal-Arroyo last December 24 — could still be amended, meaning more "holiday economics" announcements from the administration.

Businessmen, many of whom were surprised when Mrs. Arroyo extended the recent holiday break by adding January 2 at the last minute, welcomed the list. They urged the government, however, to be more circumspect.

Based on the proclamation, the following are this year’s regular holidays:

* April 9 (Maundy Thursday);
* April 10 (Good Friday);
* April 6 (the Monday nearest to April 9 which is Araw ng Kagitingan or Day of Valor);
* May 1 (Labor Day);
* June 12 (Independence Day);
* August 31 (National Heroes Day);
* November 30 (Bonifacio Day);
* December 25 (Christmas Day); and
* December 30 (Rizal Day).

The following, meanwhile, are special non-working days:

* August 21 (Ninoy Aquino Day);
* November 1 (All Saints Day);
* November 2 (additional special non-working day);
* December 24 (additional special non-working day); and December 31.

Mrs. Arroyo, who has justified moving holidays as providing an economic stimulus, said declaring December 24 and November 2 as holidays would strengthen Filipino families and boost domestic tourism.

Meanwhile, a proclamation declaring a national holiday for the observance of the Muslim feast Eid’l Fitr will be issued after the approximate date of the Islamic holiday has been determined in accordance with the lunar calendar.

Press Secretary Jesus G. Dureza said the President could still declare additional holidays.

Philippine Chamber of Commerce and Industry Chairman Emeritus Donald G. Dee welcomed the holiday list.

Mr. Dee, who is also a special government trade envoy, echoed Mrs. Arroyo in saying that the holidays would encourage consumer spending.

Asked about the possibility that the President may declare additional holidays, Mr. Dee said: "I have confidence that the President will not exercise her authority irresponsibly."

Makati Business Club Executive Director Alberto A. Lim agreed that the long weekends can benefit the economy but said Malacañang should try to stick to its list.

"[W]hat business does not like is the sudden declaration of holidays," he said.

Mr. Lim noted that too many holidays means higher costs for businesses as this would require employers to shell out money for their workers’ holiday pay.

Republic Act 9492, signed by Mrs. Arroyo in 2007, allows for the movement of holidays and traditional non-working days.

Philippines rushes P12-B budget for 2010 poll automation

The Manila Bulletin

Malacañang is rushing a P12-billion supplemental budget proposal for the automation of the 2010 national and local elections in time for the resumption of Congress next week.

This was revealed by presidential political adviser Gabriel Claudio yesterday to brush aside criticism the administration was preoccupied with amending the Constitution rather than giving priority to funding the computerization of elections.

Claudio said his office is following up the proposed additional outlay for a computerized 2010 elections with the Department of Budget and Management (DBM).

"Budget Secretary Rolando Andaya committed to have it filed this week with a tentative budget of R12 billion. It will definitely be ready in time for resumption of session on Jan. 19," he said.

Claudio said 2010 poll automation is one of the priorities of President Arroyo under her 10-point legacy agenda.

"The administration is committed and determined to support the automation of the 2010 polls in accordance with law as the key to ensure honest, orderly, and credible elections," he said.

Sen. Richard Gordon had earlier warned that it may be too late to automate the 2010 polls as Malacañang had not yet provided for its funding in the national budget.

Gordon said government was more preoccupied with Charter change than preparations for the 2010 polls.

Presidential Management Staff chief Cerge Remonde said President Arroyo is pushing for the full computerization of the country’s electoral process to encourage transparency, credibility, and accuracy of the elections.

The government pilot- tested poll automation in last year’s Autonomous Region for Muslim Mindanao elections.

Remonde said around R3 billion was allocated for the Commission on Elections’ Comprehensive Electoral Modernization Program for a voters’ validation system, design and development of automated counting and canvassing system, and design and development of a system for the electronic transmission of election results.

He noted that Republic Act 9189, or the Voters’ Registration Act, was implemented to ensure the integrity of Comelec’s database of registered voters and to obtain demographic and biometric data of all voters.

Cebu Pacific offers new flights

Paolo Luis G. Montecillo and Romer S. Sarmiento
BusinessWorld Online

BUDGET AIRLINE Cebu Pacific will add new domestic routes as it takes delivery of its seventh brand new turbo-prop plane next month.

In a statement, the Gokongwei-owned carrier said it would fly to Catarman and Calbayog in Samar, Virac in Catanduanes, and Caua-yan, Isabela starting Feb. 18.

The airline will also increase flights from Manila to Naga from daily to 10 times weekly starting Feb. 14 and from Manila to Busuanga from daily to 11 times weekly starting Feb. 15.

"We are expanding our Manila hub operations with the arrival of our brand new ATR aircraft and will make more areas accessible through our low fares and new planes," said Candice Iyog, Cebu Pacific vice-president for marketing.

The company also announced a zero fare seat sale for its Manila-Osaka service, which excludes surcharges and government taxes.

The seat sale will run from Jan. 9 to 14, and is good for travel from Feb. 1 — the starting date of the flights — to March 31.

The company will fly the Manila-Catarman and Manila-Virac routes every Tuesday, Thursday, Saturday and Sunday; and Manila-Calbayog and Manila-Cauayan on Mondays, Wednesdays and Fridays.

Earlier this week, Cebu Pacific cut fuel and insurance surcharges on all domestic flights, effectively lowering total ticket prices by as much as a fifth.

Meanwhile, direct flights from Cotabato City and Cebu City are set to start on Saturday, a welcome development for local businessmen and Filipinos from Maguindanao and North Cotabato provinces who will enjoy shorter travel time. Cebu Pacific will offer the Cotabato-Cebu route thrice a week.

Ricardo C. Juliano, Philippine Chamber of Commerce and Industry governor for Central Mindanao, said the service would hopefully attract more investments in the restive south.

"This will bring convenience to our businessmen. Local investors do not just put their investments in one basket but spread these," he said, noting companies have been expanding from Metro Manila to Cebu City and other areas in the Visayas.

Prior to Cebu Pacific’s newest offer, businessmen and air commuters from Cotabato City and the provinces of North Cotabato and Maguindanao had to travel by land to either Davao or General Santos to reach Cebu City, which takes three to four hours.

Cebu Pacific and rival Philippine Airlines (PAL) offers daily flights from Cotabato to Manila.

Mr. Juliano expects PAL, through its low-cost brand PAL Express, to follow suit. "Hopefully, too, Cebu Pacific will serve the Cotabato-Cebu route on a daily basis," he added.

Cebu Pacific is also opening new flights from Cebu to Dumaguete, Legaspi and Siargao, and increasing flights from Cebu to Iloilo, Ozamis and Tacloban.

Cebu Pacific has the most number of interisland routes and connections from its hubs in Clark, Manila, Cebu and Davao. The new routes will bring its local destinations to 32.

Cebu Pacific has one of the youngest fleets in the region composed of 10 Airbus A319, nine Airbus A320 and six ATR 72-500 aircraft as of end-2008.

Thursday, 8 January 2009

Philippines completes US$1.5b bond issue

Channel News Asia

MANILA: The Philippines said Wednesday it had raised US$1.5 billion in a 10-year bond issue to stem a shortfall in revenue this year caused by slowing economic activity.

Asia's first international sovereign bond for this year attracted around US$6 billion in demand from global investors, Dow Jones Newswires reported, quoting a Philippines finance department statement in Singapore where the float was launched.

"The transaction fulfils the government's expected external funding requirements for 2009 and represents an important success for the Philippines," Finance Secretary Margarito Teves said in the statement.

"We are hopeful that our success will bode well for other Philippines and Asian borrowers," he added.

The public offshore bond market has not seen a deal out of Asia since the global credit crisis took hold in September, the report said.

Pricing was at the tight end of the indicative yield range of 8.50 and 8.75 per cent touted to investors Wednesday, it added.

The issue was lead-managed by Credit Suisse, Deutsche Bank and HSBC Holdings.

Manila will use the proceeds to help finance a programmed budget deficit of 102 billion pesos (US$2.2 billion) this year.

- AFP/yb

Zest Air presents 4 new aircrafts for Clark hub


Zest Air, the local airline formerly known as Asian Spirit, presented today its 4 newly acquired aircrafts that will soon serve its regional flights from the Diosdado Macapagal International Airport (DMIA), the country's alternative premier airport located in Clark, Pampanga.

Zest Air president and CEO Alfredo Yao led the presentation of the airline's 4 new aircraft at the Asian Aerospace Hangar of the 2,500-hectare Clark Civil Aviation Complex.

"Clark will be the premier international airport that is why we decided to mount flights from the DMIA. We see a lot of potential for the airport and this is a welcome development for the airline industry in the country," Yao said.

Zest Air has acquired three M-60 airplanes with a seating capacity of 56, and an Airbus A320 with 162 passenger capacity. All four aircraft arrived at the DMIA's civil aviation complex.

The carrier is planning to mount regional international flights from DMIA to serve the Asian region. Yao said the target regional destinations from Clark include Hong Kong, Incheon, Macau, Xiamen, Shanghai, and Bangkok.

"The impending flights of Zest Air are another major development for DMIA, a move that is in accordance with President Gloria Macapagal Arroyo's vision of making the DMIA the country's premier international airport," Clark International Airport Corporation (CIAC) president and CEO Victor Lucianosaid in a statement.

Luciano, together with executive vice president and COO Alexander Cauguiran, and VP for operations and DMIA general manager Bienvenido Manga graced Zest Air's presentation of its 4 new aircrafts.

Last month, leading local low-cost carrier Cebu Pacific also established its international operations in Clark, its fourth hub after Cebu, Manila, and Davao. From DMIA, Cebu Pacific serves four regional destinations--Singapore, Hong Kong, Bangkok, and Macau. It has only one plane based in Clark serving these regional routes.

Zest air, on the other hand, is set to further beef up its Asian flights from Clark. Yao said that another Airbus A320 aircraft is set to arrive by January 3.

He added that starting December 20, Zest Air will be mounting domestic flights from Manila to Cebu and Davao. Two more Airbus A320, he said, are expected to arrive by mid-2009.

as of 12/18/2008 12:50 AM

Philippine President reaffirms commitment to Mindanao peace efforts

MANOLO FORTICH, Bukidnon—President Gloria Macapagal-Arroyo today reaffirmed her strong commitment to a lasting peace in Mindanao before her term ends in 2010.

Notwithstanding the long impasse in the peace process between the government and the Moro Islamic Liberation Front (MILF), she remains steadfast in her efforts to bring to a an end the decades-old conflict in the region, the President said.

“The peace process in Mindanao was dealt a deep setback, but I am fully committed to working to reach as much progress as possible in the time I am still have in office,” the President said in a one-on-one interview with DXIF Bombo Radyo at Del Monte Lodge here.

The Chief Executive said her administration will pursue the peace process within the parameters set by the Constitution and by the Muslim and Christian communities who are directly impacted by the conflict.

However, she underscored the need to, first, bring back to the region, regain order and “be able to trust the MILF leaders and ensure that they truly represent their community.”

“The peace process must proceed and it must do so in an atmosphere of stability and order in the region and regained trust that the MILF has control of renegade elements,” the President said, stressing that “we also want to ensure that they truly represent their community before we can effectively reactivate the peace process again in earnest.”

“We all want to see peace and prosperity in the Philippines and I am confident it will happen,’ she added.

To show her administration’s seriousness in seeking a resumption of the stalled peace negotiations, the President said the newly-reconstituted government peace panel has already been directed to touch base with the facilitators and their counterparts in the MILF.

With the new paradigm on the peace efforts already in place, she said the government panel is ready to hold substantive discussions concerning the peace process, including ceasefire-related issues, the International Monitoring Team (IMT) and accelerated development efforts for Mindanao.

The peace process was disrupted after fighting broke out anew between government forces and Muslim rebels last Aug. 18.

The renewed fighting was initiated by three of the 19 MILF commanders after signing of the controversial Memorandum of Agreement (MOA) on Ancestral Domain between the government and the MILF was aborted.

Philippine GIR hits record $ 37 B in 2008

The Manila Bulletin

The country’s gross international reserves (GIR) as of end-December totaled a record high of $ 37.059 billion, a level fairly within expectations despite slower foreign exchange inflows and capital flight in reaction to the financial crisis.

The Bangko Sentral ng Pilipinas (BSP) reported yesterday that GIR was $ 3.3 billion or 9.9 percent higher compared to the end-2007 closing of $ 33.75 billion. It is the highest dollar reserves ever reported.

Of the GIR, $ 31.599 billion are BSP’s foreign investments while $ 4.537 billion are gold reserves. The rest are foreign exchange and short-term reserves.

BSP said the annual increase in the GIR level in 2008 was attributed mainly to inflows from the BSP net foreign exchange operations and income from its investments abroad, as well as the National Government’s deposit of proceeds from its reopening of global bonds and other foreign borrowings during the year.

In the meantime the BSP explained that the revaluation gains in its gold holdings on account of the increase in the price of gold in the international market during the year also contributed to the higher year-end GIR level. "These receipts were offset by outflows arising mainly from payments of maturing foreign currency-denominated obligations of the NG and the BSP," officials said.

The GIR level is rising every month except in October when the foreign exchange hoard lost $ 1 billion due to exchange rate losses and payment of maturing obligations.

The BSP has been tapping short-term financing to prop-up the GIR. It has since borrowed $ 1.5 billion worth of gold-backed and security-backed loans.

The first loan was taken out in June in the amount of $ 500 million from Bank for International Settlements.

At the moment, the GIR level can cover up to 5.6 months of imports of goods and payments of services and income. It was also equivalent to 4.5 times the country’s short-term external debt based on original maturity and 2.8 times based on residual maturity.

In the meantime BSP’s foreign exchange swap positions further dropped to $ 1.59 billion as of November, which was the lowest since the January 2006 of $ 1.19 billion. Swaps totaled almost $ 10 billion at the beginning of 2008.

GIR is fueled mainly by remittances as well as foreign direct investments and exports. NG dollar deposits from multilateral loans also add to GIR.

For 2008 the BSP expects total overseas Filipinos remittances to grow by 13 percent to $ 16.9 billion, more than forecast of 10 percent. Of this full-year assumed amount, $ 16.3 billion are expected to be remitted through the banking system while about $ 600 million are through the non-formal channels.

Philippines unveils P300-B stimulus package

The Manila Bulletin

The National Economic and Development Authority (NEDA) has unveiled a P300-billion economic resiliency plan that would pump prime the domestic economy this year.

Socioeconomic Planning Secretary and NEDA Director-General Ralph G. Recto said that the plan which is the country’s own stimulus package, was borne by President Arroyo’s desire for the country "to hit the ground running in 2009" in response to the global economic crisis.

"What we intend to do is upgrade infrastructure and capital stock and expand social protection at the same time," Recto said.

The resiliency plan hopes to ensure sustainable growth and attain the higher end of the growth targets for the year. The Development Budget Coordination Committee has pegged growth for 2009 at 3.7 percent to 4.7 percent.

The plan aims to save and create jobs, protect the poorest of the poor, returning OFWs and workers in export industries, ensure low and stable prices to support consumer spending, and enhance competitiveness in preparation for the global rebound.

Recto said that one of the components of the Plan involves spending 60-80 percent of the productive portion of the 2009 budget of implementing agencies during the first semester, with particular focus on the infrastructure sector.

In the first semester of 2008, the government which accounts for 20 percent of the country’s gross domestic product, spent only 30 percent of its budget. The planned frontloading and spending for the first half of 2009 is expected to boost private sector confidence in the economy.

The government is accelerating spending for fast, off-the-shelf infrastructure which has simple engineering requirements and no right-of-way problems. "We are encouraging the government financial institutions (GFIs), government-owned and controlled corporations (GOCCs), local government units (LGUs) and the private sector to participate in these infrastructure projects," Recto said.

"The government should also improve revenue collection through better tax administration," he added. To stimulate the exports sector, the government has implemented various programs to encourage exporting firms to diversify, innovate and upgrade their products.

"So far, we have provided tax relief for the private sector by reducing corporate income tax from 35 percent to 30 percent and exempting minimum wage earners from personal income tax and increasing in personal exemption of non-minimum wage earners," Recto said.

The government is proposing to increase the Department of Social Welfare and Development’s (DSWD) allocation for conditional cash transfers or the Pantawid Pamilyang Pilipino program. About P5 billion will also be added to cover the additional 321,000 poor households giving them a maximum cash grant of P9,000 per year.

"We also want to add P1 billion for PhilHealth to ensure full national government contribution to the National Health insurance Program. We are also proposing to increase the allocation for the Technical Education and Skills Development Authority (TESDA) by P5.66 billion to cover an additional 565,980 beneficiaries," he said.

Facilities of the Department of Health (DOH) will also be increased by adding P1.97 billion for primary and secondary hospitals. Likewise, about P100 billion will be created with the private sector to lower borrowing or financing costs for capital expenditure (CAPEX) spending.

Recto also explained the strategies of the plan include putting in place programs to assist the vulnerable domestic workers and OFWs.

"The programs for OFWs abroad and those returning include redeployment to emerging foreign labor markets, development of new market niches, as well as repatriation assistance, when needed," he said adding that enhanced reintegration services and livelihood assistance are also made available for returning OFWs.

The government also created a "payback package" for OFWs who were retrenched due to the global financial crisis. This package includes the setting up of a P250-million support fund, skills training to avail of in-demand jobs in other parts of the world and setting up of Department of Labor and Employment (DOLE) and Overseas Workers Welfare Administration (OWWA) desks in the provinces to match OFWs’ skills with available jobs.

Wednesday, 7 January 2009

Manila defies travel slump, grows 8.6%

Philippine International Air Passenger Traffic Up +8.6%
By Cris Larano
Dow Jones Newswires

MANILA -(Dow Jones)- International airline passenger traffic in the Philippines increased 8.6% on year in the first three quarters of 2008, data released Wednesday by the Civil Aeronautics Board showed.

The increase was largely due to Philippine Airlines and Cebu Pacific's opening more routes and adding flights to existing destinations. The 3 airlines that service the Philippines carried 9.16 million outbound and inbound travelers in the January-September period, up from 8.43 million in the same period a year earlier, the data showed.

Philippine Airlines and Cebu Pacific, which are both overhauling their fleets, increased their combined share of the international passenger market in the first three quarters to 41%, from 39% in the same period a year earlier.

Philippine Airlines carried 2.74 million travelers in the period, 7.7% more than the year before. It carried 1.31 million inbound passengers, 14% more than the year before, and 1.43 million outbound passengers, up 3.5%.

Cebu Pacific increased its total traffic by 40% on year to 1 million, with 477,069 inbound passengers, up 39%, and 525,598 outbound passengers, up 41%. - 632-848-5051

Fitch Ratings retains 'stable' outlook for the Philippines

By Des Ferriols Updated January 07, 2009 12:00 AM
The Philippine Star

London-based Fitch Ratings has maintained its stable outlook for the Philippines, saying the country is “reasonably healthy” despite the tumult in the global economy.

Bangko Sentral ng Pilipinas Governor Amando Tetangco said the outlook indicated Fitch’s confidence in the Philippines’ ability to weather the global slowdown or even recession in the country’s major trading partners.

A stable outlook means that the Philippines stays at its current credit ratings until the next Fitch review.

In a television interview, Fitch managing director James McCormack said the Philippines, China and Indonesia are the only countries that are not in Fitch Ratings’ negative watch.

Speaking at the weekly Tuesday Club breakfast forum at the EDSA Shangri-La yesterday, Tetangco said Fitch’s action reaffirmed the view of monetary officials that the country’s external position is strong enough to buttress the economy even amid the global slowdown.

“The Philippines is still reasonably healthy. Public finance is well-managed in the last couple of years,” McCormack said.

McCormack said weaker growth in the region was not necessarily negative from a sovereign creditor’s perspective.

China, according to McCormack, was still exceptionally well based on its “extremely high” foreign exchange reserves.

The Philippines’ reserves may not be as big as China’s but its external position is strong.

The Bangko Sentral ng Pilipinas said the country’s reserves stood at $36.2 billion as of November 2008 and Tetangco said authorities expect a further buildup this year.

Tetangco said that even with the anticipated slowdown in foreign short-term investments as well as in exports and remittances, the country’s external position would be robust because remittances would still come in and some export sectors might even benefit from the global slowdown, particularly business process outsourcing.

“I think in case of the Philippines, it’s been largely left aside in terms of what’s going on in international capital markets; and it still benefits from reasonably strong remittance flows,” McCormack said.

Remittances would probably suffer but McCormack said the country would remain reasonably healthy.

“Public finance is well-managed in the Philippines in last couple of years,” he said. “We don’t think it’s sustainable in the medium term but I think the recent record has been quite good so the Philippines looks okay.”

According to Tetangco, Fitch’s action has validated the BSP’s view that the country’s external position is resilient and healthy. He said the Fitch outlook would boost investor confidence amid the panic that struck the markets last year.

Tetangco said the country has enough foreign exchange buffers despite portfolio outflows because of the adequate reserves built up by the BSP in response to the expected slowdown in investments and exports in 2009.

“It is difficult to predict the extent risk appetite will retreat from the market,” Tetangco said. “But as I said, our reserves continue to be at comfortable levels. We also have buffers to slowing, even reversing, portfolio flows.”

After its mid-year review last year, Fitch Ratings affirmed the country’s credit ratings, keeping its outlook at “stable” on expectations that external debt ratios would be kept afloat by inflows from overseas Filipinos.

Fitch currently rated the Philippines’ long-term foreign currency Issuer Default Rating (IDR) at ‘BB’. Likewise, Fitch said the country’s long-term local currency IDR would be kept at ‘BB+’, while short-term foreign currency IDR would stay at ‘B’ and the country ceiling at ‘BB+’.

Fitch said the country’s “relatively strong” external financial position continued to support its current sovereign credit ratings, boosted largely by robust inflows from overseas workers.

However, Fitch said it still considers the country’s public finances fundamentally weak and that significant improvements in revenue base would have to be made to make the Philippines at par with similarly-rated countries.

“Ongoing current account surpluses, driven largely by overseas workers’ remittances, are contributing to a steady reduction in the country’s external debt ratios, and have allowed for a significant increase in official foreign exchange reserves,” said Fitch in its June 2008 report.

Fitch earlier said net capital flows were much weaker in 2008 because of the general reduction in global investors’ risk appetite amid slower growth in advanced economies as well as lingering uncertainty in credit markets.

Fitch noted that net portfolio equity inflows averaged about $2.4 billion annually between 2005 and 2007.

Philippine int'l airports fly in new direction

By Tina Arceo-Dumlao
Philippine Daily Inquirer
First Posted 18:05:00 12/28/2008

MANILA, Philippines - Fortunately or unfortunately, tourists and business travelers get their first impression of a place they are visiting at the airport they land in.

This is one of the reasons why countries and cities take great pains and spend much money to put up state-of-the-art airports that double as show pieces of what they have to offer. Think Changi in Singapore, Chek Lap Kok in Hong Kong, Heathrow in London and John F. Kennedy in New York City.

But more than just putting on a great face, airports play a role in economic development because of the goods and people that pass through their portals.

The Manila International Airport Authority, which oversees all international airports in the Philippines, recognizes this important role, which is why it has come up with programs to ensure that it fulfills its vision to bring the main airports in the Philippines at par with the best in the world.

In an interview with the Inquirer, Miaa General Manager Alfonso Cusi explains how the Miaa plans to stay true to its mission.

Q: What do you think is the role of airports in national development?

A: The Ninoy Aquino International Airport undoubtedly continues to be the main international gateway of the country, as it has been for the past several decades. Last year, even with the emergence of new airports with international flight capabilities, the Naia complex, handled about 90 percent of all international traffic in the country. If we were to consider total passenger traffic in the country, that is, including domestic passenger movement, Naia accounted for about 75 percent.

Throughout the years, the Manila International Airport Authority has been managing the Naia complex, which is composed of Terminal 1, Terminal 2 or the Centennial Airport, and the Manila Domestic Passenger Terminal. This year, starting in June 2008, the long-awaited Terminal 3 was finally opened with its first commercial flight during the return flight of President Gloria Macapagal-Arroyo after her state visit to the United States.

We would like to believe that Miaa had been successfully running the main gateway that is Naia through the past decades and gauging from its basic key result areas of passenger safety, security and convenience, Naia as an airport has somehow contributed satisfactorily in making the Naia a world class and efficient airport, giving its all-out effort in coping with the ever growing flight and passenger traffic.

Q: How busy are the main airports?

A: Naia handled around 21 million passengers in 2007. In 2007, we registered 54,643 international flights consisting of both incoming and outgoing flights. Our domestic flights are around 92,648 flights a year. With our runway system consisting of our primary runway 06-24 and our secondary runway 13-3, our runway capacity is fast approaching its maximum level, that is why we are undertaking appropriate technical studies so we can still enhance our capacity. At present, we can accommodate about 30 to 40 flights an hour with as many as 42 flights during peak hours.

Q: Over the past five years, what were the major accomplishments of Miaa as far as airport development is concerned?

A: The Naia, in its own humble way has been judiciously assessing ways and means by which it could be a better airport for its stakeholders. For the various international airlines, we have been on our toes in making sure that we are always compliant with all the appropriate international standards governing civil aviation, such as those of the International Civil Aviation Organization or Icao, the United States' Transportation Security Administration or TSA and the International Aviation Transport Association or the Iata.

By observing and abiding by the set international standards in civil aviation and airport management in terms of operational soundness, security provisions and safety standards, we are able to provide a healthy and effective venue for airlines to operate in.

We may not be able to enjoy the financial capacity to compete among the most modern airports in the world, nor can we guarantee that we can hold a candle in terms of the supremacy of our airport processes as this also is based on technology. But we have been able to identify that there is one area that we are sure and bullish to be able to compete in and that is in the area of human resources, or our people.

We have thus pursued our service excellence campaign using a unique branding strategy of making the airport be known and regarded as one of the most friendliest airports in the region. Naia as the smiling airport is being promoted with our creative campaign of “Naia, we go the extra Smile,” to catch the imagination not only of our external public but to create greater commitment within each and every individual in the airport.

Q: What are the priority projects going forward?

A: I would say that a new chapter of the corporate life of the Miaa came when a new executive order was signed by President Macapagal-Arroyo. Having been entrusted with the management and administration of the country's premier international gateway for almost the past three decades, Miaa had acquired and developed the expertise necessary for the proper and aggressive functioning of international airport terminals.

EO 341 was issued to modify and expand the powers and functions of the Miaa by authorizing and directing it to exercise administrative supervision and control over all international airports in the Philippines. This will make it possible to achieve the objectives of providing high standards of accommodation and service within the context of a financially viable operation.

The overall picture calls for revitalizing the country's airport hubs respective of their distinct purpose in the industry and redefine the limits of their development capabilities. With the Naia servicing 90 percent of all international passenger traffic and with the new Naia Terminal 3 opened, which dramatically raised terminal capacity of the Naia complex to almost 35 million passengers a year, it will be a most challenging and difficult road toward being able to rationalize the gateway development broad strokes for the Naia as well as the other international airports in the country, with the end in view of aggressively pursuing the bright prospects of a developing country with such vast potential in trade and tourism.

Q:. What would you say would be the major issues confronting the airports?

A: Basically, the global airport industry is a very exciting and ever changing industry. Airports have been the showcase all nations, regardless of whether they are developing or are developed countries. Miaa, entrusted with premier gateway administration and development, is certainly facing the challenge of addressing not only national or parochial concerns within the Naia complex, but needs to deal with the atmosphere of competitiveness in the mind of the global passenger.

This is so because, somehow, airports play a very crucial role in the way countries all over the world market or sell themselves.

Q. What are the major stumbling blocks to further development of airports?

A: One of the common constraints to development programs especially for those involving infrastructure development is the availability of long-term financing for capital expenditure. This is most especially true for the development of airports, which is truly characterized by a high level of capex. Hence, it is important that countries are able to project the long-term prospects not only of the country as a whole, but also the various regions within a particular nation. The development of airports is usually a natural consequence of a nation's development thrusts and the Philippines is not an exception. Hence, we are aligning our national plan for airport development with the overall plan for infrastructure development as well as the trade and tourism thrusts of the country.

Q: The airports have been downgraded because of safety, how is the Miaa responding to this pressing issue?

A: This is actually an issue that concerns more the former ATO, now the Caap, since the downgrade has been caused by the observation that we have had inadequacies in air safety concerns, air controllership training and support policies and laws in civil aviation. But just the same, the Miaa and the Naia community have been joining hands with the Caap in helping make possible the pertinent measures that will help us get into the same category as we were before.

Q:. Do you see more airlines coming to the Philippines? Why or why not?

A: Definitely. Firstly, there is the item on the tourism prospects of the country. The growth of airlines servicing a country's routes is usually anchored on the way a country is able to pursue its trade and tourism thrusts. Secondly, it's also a function of how airports are built and managed. We are confident that when airports are run professionally, there is no reason why there will be no growth in terms of passenger flights and passenger traffic as a whole. This is the very reason that we at the Miaa have a very crucial role in helping maintain a healthy mix of international airlines. This is the reason why the Miaa is also teaming up with all the government agencies operating at the Naia, such as the Bureau of Immigration, Bureau of Customs, Philippine National Police Aviation Security Group, Department of Tourism, quarantine offices of the Department of Health and others. This is also the reason why we need to also closely work with all the private international and domestic airlines and the various service providers handling a wide array of airport services in cargo handling, security screening, housekeeping and many others.

Q: Do you see our airports in Metro Manila becoming truly world class?

A: Certainly. We have actually been saying that at the Naia we offer world-class service, world-class smiles.

Filipinos highly optimistic for 2009

By Fr. Bel R. San Luis, SVD
The Manila Bulletin

Here’s good news! Despite the grim forecasts about the world economy, nine out of 10 Filipinos look forward to a happy Christmas and better New Year.

This is revealed in the latest survey conducted by Social Weather Station (SWS) from Nov. 28-Dec. 1, 2008.

* * *

Ninety-two percent of those interviewed felt hopeful for 2009. Only eight percent said they looked forward to the coming year with fear. The survey showed a one percent increase from 2006 and 2007.

* * *

In Germany, where the survey questions on hope for the New Year originated, the percentage of hopeful citizens never exceeded 58 percent since 1991, despite the fact that the country is one of the richest in the world.

* * *

The SWS survey shows Filipinos to be a very optimistic and hopeful people. Moreover, they see that despite the global economic crisis and political bickerings, there are positive gains under President Gloria Macapagal Arroyo, notably the numerous infrastructure projects in the countryside, better revenue collection, the fast drop of the oil price.

* * *

In fact, in an earlier survey conducted by Social Weather stations last September 24-27, 2008, the self-rated poverty average shows a decrease of seven points, the lowest in over 25 years.

So, as the late Pope John Paul XXIII once said: "Look to the good you see around you and encourage it as much as possible. That in itself will lessen the bad."

* * *

Presently the government focuses its attention on cushioning the impact of the economic tsunami that’s expected to hit Asian countries this year.

Consequently, more jobs should be generated to absorb our contract workers who were laid off abroad or whose companies closed down. One concrete means is to provide micro business opportunities for small entrepreneurs.

* * *

Talking of hope, ours should not be a passive kind which depends only on doleouts or for the government to spoonfeed us.

What’s needed is an active hope which works out solutions to problems, induces us to be more resourceful and enterprising.

Active hope does not let things happen but MAKE things happen.

* * *

For instance, a young man who took up computer science invested some capital for a small computer shop. Through diligence and perseverance, he was able to increase his sole computer unit to two, then three as his profits grew.

Now he has a modestly successful business.

Electronics industry shortens work-week

Instead of laying off employees
The Manila Bulletin

The domestic electronics industry, the country’s biggest exporter and perhaps the biggest employer, is implementing an industry-wide shortened work week instead of laying off people and urged government to conduct more trainings for workers because when the upturn comes it would be fast and high and Philippine companies must be ready for it.

Ernie Santiago, president of the Semiconductor and Electronic Industries in the Philippines (SEIPI), said some companies are already implementing a four-day work week indefinitely from the regular six-day work week.

"What we are trying to work is how to manage the downturn. We have to mitigate layoffs people either in finance or purchasing, but the goal is to keep the company alive and prepare for an upturn," Santiago said.

Santiago said this is the first time that companies are implementing shortened work week although some companies had laid off people in 2001 during a global electronics industry downturn.

Santiago said that electronics companies in the country have two kinds of customers: those loaded with cash and those with no more credit line from the banks.

"Those with no credit line from the banks have no recourse but to cancel orders from the Philippine companies," he said.

Orders have also to be cancelled because the end-users, the consumers, of these electronics products are not buying also.

"Banks have also become stricter with the use of credit cards thus restricting credit cardholders on the liberal use of their credit line. As a result, consumers are also trying as much as possible to hold on to their cash money," he added.

Since nobody can tell as to when the credit crunch would end, SEIPI members are implementing measure to manage the situation carefully so that when the upturn comes they would also be prepared.

"Our projection is that once upturn comes, it would be too high and too fast that one should be ready so if we plan to layoff, manage it well because you don’t want to be caught in situation where you have no more people to help you run the business," he said.

While managing the crisis, SEIPI is urging the government to provide more trainings for those already laid-off to prepare workers for the upturn.

SEIPI’s projection is that 2009 is worst than 2008. The last quarter of 2008 is the worst as orders were reduced by 40 percent.

"But this is the time to restructure, train people, improve organizations, improve processes and factory retooling," he said.

"This signals that the Philippines is ready when the upturn comes," he said.(BCM)

Food, construction expected to drive Philippine economic growth

BusinessWorld Online

AMID EXPECTATIONS that the economy will slow down with the rest of the world as the financial crisis deepens this year, local food production and construction are projected to lead growth, economists said in separate recent interviews.

University of the Philippines economist Benjamin E. Diokno, former Budget secretary from July 1998-January 2001, said that agriculture should be able to grow by 2%-4% this year.

Agriculture Secretary Arthur C. Yap had said in November last year that his department expected the sector to have grown by 3.8%-4.5% last year.

Data from the National Statistical Coordination Board (NSCB) showed that agriculture grew 3.4%, year on year, in the third quarter of 2008, compared to a 3.7% growth in the same period in 2007.

"Actual growth [this year] would depend on weather pattern — whether it’s favorable or harsh — and incentives for farmers to plant crops using high-yielding seeds and fertilizers," Mr. Diokno said.

He added that growth would also depend on more rural infrastructure like irrigation and farm-to-market roads.

Peter Lee U, an economist from the University of Asia and the Pacific (UA&P), shared the same view, saying that "food utilities should continue to be okay as it is a necessity and rely mainly on the domestic market."

Fellow UA&P economist Victor A. Abola said the government’s proposed budget of over P39.7 billion this year for fertilizer, seeds, rehabilitation of irrigation systems, farm-to-market roads and storage facilities should help prod food production.

UA&P’s Center for Food and Agribusiness has projected that agriculture growth would hit 4%-4.5% this year, barring prolonged dry spells, strong typhoons and spikes in fertilizer prices.

Apart from food production, construction is likewise expected to grow this year.

Mr. Abola said that construction should post double-digit growth this year due to increased public infrastructure spending. He noted that the proposed 2009 budget includes a 20% hike in infrastructure spending to prod growth of economic activity amid a global slump.

Mr. Abola added that private construction should also grow due to demand for real estate, particularly residential units by overseas Filipino workers (OFWs), even as retrenchment has started in some economies hosting them.

"BPO [business process outsourcing] will also be positive, with the risk and costs in India leading firms to move to alternative sites like the Philippines," he said, explaining that this would mean increased demand for office space.

Main risk

While Mr. Diokno agrees that public construction could grow this year, he said that there is a risk since the proposed budget for the year has not been approved. Bicameral conference committee debates on the proposed P1.415-trillion national budget this year will start when Congress resumes session this January 19. "The risk is the delay in project starts [sic] as the approval of the budget gets stalled," he said.

NSCB data showed that construction grew 21.3%, year on year, in the third quarter of 2008, compared to the 17.8% growth rate posted in the same period of 2007. Public construction grew by 20% from 11.5% for those comparative periods, as the national government raised infrastructure spending by 52.7% and local governments by 11.2%. Private construction grew 13.8% from 19.5% in the same periods, spurred by demand from BPO firms and OFWs.

Socioeconomic Planning Sec. Ralph G. Recto said in a separate interview that construction and manufacturing would fuel growth this year. "Construction would remain strong due to the strong push for public construction and demand of the BPO sector, as well as OFWs and tourism," he said.

He explained that manufacturing, which grew 4.7% in the third quarter 2008 from 3.7% in the same period 2007, should be able to endure the slowdown this year since slowing inflation would spur domestic demand.

The economy expanded by 4.6% in the third quarter last year. The government expects gross domestic product to have grown 4.1%-4.8% last year, and to expand by a slower 3.7%-4.7% this year.

"The industries that would drive growth for 2009 would depend on how fast, efficient and productive government will spend its budget for the first half of the year," Mr. Recto said.

"Government must spend at least 70%-80% of its productive outlay immediately. The first half is critical," he stressed.

Tuesday, 6 January 2009

Philippine Central Bank sees remittances growing to $18b

Eileen A. Mencias
The Manila Standard

The Bangko Sentral expects remittances this year to grow around 6 percent to $17.9 billion despite the slowdown in the global economy.

Central bank sources said Filipinos working abroad were expected to send home $17.3 billion through the banking system. Remittances in 2008 likely grew 15 percent to a little over $16 billion. About eight million Filipinos work abroad.

Bangko Sentral Gov. Amando Tetangco Jr. said in an interview with Global Source Philippines that demand for Filipino workers would continue because of the diversity and the quality of the skills they offer, adding that more Filipinos were expected to get permanent residency status.

Global Source is an independent network of financial advisers.

“While we expect the crisis to affect permanent workers, we believe that they have better flexibility to look for replacement jobs compared to workers who rely on contract renewals,” Tetangco said.

“Bilateral talks with host countries have also continued to open up new employment opportunities abroad for Filipinos in terms of translation and transcription services. Furthermore, the inelastic demand for medical and healthcare practitioners from the ageing population of developed countries account for the continued demand for overseas labor particularly from the Philippines. These skilled workers earn more income and remit more foreign exchange,” he added.

Deployment of Filipino workers in the first 10 months of 2008 surged 25.5 percent to 1.11 million from 888,339 year-on-year.

The central bank earlier warned of a slowdown in deployment next year as host countries dealt with the impact of the global financial meltdown. Canada and some Middle Eastern countries and Australia, however, have expressed interest in tapping Filipino workers.

Remittances from Filipinos abroad totaled $13.71 billion in the 10-month period, up 15.5 percent on year.

Progress seen at NAIA terminals

Terminal 3’s half capacity filled in by budget flights
By Roderick T. dela Cruz
The Manila Standard

The Ninoy Aquino International Airport Terminal 3, which was designed for 13 million passengers a year, is now on half its capacity mainly on budget flights, said airport officials.

Opened on July 22 last year, the terminal has since hosted domestic flights of Cebu Pacific, Air Philippines and PAL Express. On Aug. 1, Cebu Pacific Air’s international operations was added.

The Manila International Airport Authority, which operates Naia terminals, targets to transfer all international flights to Terminal 3 from the old Terminal 1 and the Terminal 2 this year.

Terminal 1, which was refurbished last year, continues to serve all the international flights of airlines except Cebu Pacific while Terminal 2 takes in domestic and international flights of Philippine Airlines.

MIAA general manager Alfonso Cusi said Terminal 3’s performance was commendable.

“The Naia Terminal 3 is now handling about half of its designed capacity of 13 million passengers yearly,” he said.

Tirso Serrano, MIAA assistant general manager for airport development and corporate affairs, says Naia continues to be the principal international gateway of the country, despite the emergence of new major airports such as the Diosdado Macapagal International Airport in Clark, Pampanga.

Serrano said the Naia complex handled last year about 90 percent of all international flights.

“If we were to consider total passenger traffic in the country, that is, including domestic passenger movement, Naia accounted for about 75 percent,” he added.

In its year-end report, MIAA cited useful improvements and service enhancements at the Naia complex, including expanded departure lobby of Terminal 1, re-layouting of the terminal passenger movement areas, new metered yellow taxi cabs, free shuttle service between terminals, new concierge and enhanced meet-and-assist services, new security equipment and other facility and housekeeping upgrades.

“For the various international airlines... we are always compliant with all the appropriate international standards governing civil aviation, such as those of the International Civil Aviation Organization, the United States’ Transportation Security Administration and the International Aviation Transport Association,” Cusi said.

SEAIR transport franchise lapses into law

BusinessWorld Online

A MEASURE that gives budget carrier Southeast Asian Airlines, Inc. (SEAIR) a 25-year franchise to operate domestic and international air operations has lapsed into law.

Malacañang failed to sign Republic Act 9517, which gives the airline the authority to operate the service from Clark, Pampanga as its base.

In a phone interview, SEAIR President Avelino L. Zapanta said the franchise would boost their corporate standing and make the carrier more attractive to investors.

"The value of the company has increased and it will attract some investors in terms of additional equity or lending, and that would allow us to expand our operations," he told BusinessWorld.

Under the Constitution, the President has 30 days to sign or veto a bill. In the absence of an action, it automatically lapses into law.

The House of Representatives approved the SEAIR franchise on May 12, while the Senate passed its own version on Sept. 29. The bill was sent to the Palace for the President’s signature in November, and it had until Dec. 27 to act on it.

Mr. Zapanta noted that before the franchise, SEAIR had obtained a mere certificate from the Civil Aeronautics Board (CAB), which had allowed it to offer air service.

The law requires SEAIR to allot at least a quarter of its operations to the domestic market. It may carry passengers, mail, goods and freight, subject to government regulation.

The law bars SEAIR from transferring or selling its franchise to a third party without congressional approval. Moreover, SEAIR must list at least 30% of its outstanding capital stock on the exchange within five years to encourage public ownership of utilities.

Established in 1995, SEAIR is based in Pampanga and has hubs in Puerto Princesa, Cebu and Zamboanga. Its local destinations include Boracay Island via Caticlan; and Busuanga, El Nido and Puerto Princesa in Palawan. SEAIR is owned by foreigners Iren Dornier and Nikos Gitsis and the Filipino group of Tomas Lopez, Jr.

In a related development, rival Zest Airways, Inc. is planning to fly to Japan by the second quarter to take advantage of available air rights under an air agreement approved last year.

The flights will compete directly with services offered by Lucio Tan-owned flag carrier Philippine Airlines (PAL) and another budget carrier, Gokongwei-led Cebu Pacific.

"We’ll have the same plane, we’ll have the same route... It will all boil down to marketing," Zest Airways Chairman Alfredo M. Yao said in an interview yesterday.

Based on documents filed with the Civil Aeronautics Board last month, Zest Airways wanted to start daily flights between Manila and Osaka, and between Cebu and Fukuoka starting May.

These are similar to Cebu Pacific’s thrice-a-week Manila-Osaka service that started in November.

PAL, meanwhile, flies from Cebu to Osaka twice weekly. The flag carrier revived the service in October, which it stopped offering in 2001 in the wake of the Sept. 11 terrorist attacks in the US. Both PAL and Cebu Pacific’s regular roundtrip flights to Japan cost around $500. Mr. Yao said his airline had yet to decide on ticket prices.

Zest Airways’ planned service is in line with a recent deal between the Philippines and Japan increasing the frequency of flights between the two countries, mainly from Manila and Clark. Local officials, however, earlier admitted the traffic between the two countries had declined due to the slowing global economy.

The government was supposed to hear Zest Airway’s application on Dec. 18, but the hearing had been moved to this month, officials of the CAB’s air rights division said.

Earlier, the carrier bought seven new airplanes as part of its refleeting program. Five of the 50- to 60-seater aircraft will be used to expand the airline’s local operations, while two 150-seater Airbus 320s will fly to regional destinations.

Set up in 1995, Zest Airways flies to 12 local and three international destinations — Incheon, Korea; Sandakan, Malaysia; and Macau using a fleet of 10 planes. Mr. Yao, who also owns juice maker Zest-O Corp., bought Asian Spirit in March reportedly for P1 billion. He had offered to buy rival SEAIR, but the parties failed to close the deal.

Sunday, 4 January 2009

Arroyo: Let’s talk economics, not politics


MANSION HOUSE, Baguio City – “You know, I don’t want to talk about 2010 – that’s far away. I want to talk about what I’m doing, about what I have to do now.”

Thus said President Gloria Macapagal-Arroyo in response to question posed by a member of the Baguio City media yesterday (Wednesday, Dec. 31) about her plans for 2010.

“Politics is not foremost in my mind. If I were always thinking about politics, I would not have been able to build all these roads in the Cordillera and all these (projects)... So let’s talk economics, not politics,” she said.

She stressed it was not mere luck that the Philippines is not one of the 30 countries that the United Nations Food and Agriculture Organization (FAO) has identified as in the grip of the global economic crisis.

Similarly, the Philippines is not also among the countries that have slipped into recession under the battering of the worldwide slowdown.

Foresight and careful planning has a lot to do with the country’s resiliency in the midst of the storm buffeting the global economy, the President said.

“As I said, we cannot predict what will happen in the future but we can plan. And, it was, you know, we were lucky this year but we worked hard to have that luck – we planned for it,” she added.

The President pointed out that last “October, I had presented to the business community a contingency plan. But that is no longer a contingency plan because two-thirds of the world is already in recession -- that is a resiliency plan.”

The contingency plan was unveiled during a meeting of the National Economic and Development Authority (NEDA) “and I have been asking him (NEDA Director-General Ralph Recto) to continue to propagate it.”

The plan, calls for, among others, the implementation of various infrastructure projects to serve as economic stimulus. “That’s why we want this 24/7 on Halsema Highway -- that’s part of our stimulus,” the President said.

“We want to have a lot of social services targeted for the poorest of the poor that’s why it is very important for the DSWD (Department of Social Welfare and Development) to identify who, indeed, are these poorest of the poor to avoid free riders,” she said.

Asked if the government would extend the “food chain” to Mt. Province, the President explained that “those are details and I don’t really work on details – I work on the strategic points.”

She stressed, though, that Agriculture Secretary Arthur Yap will work on the details of the aggie project even as she pointed out that the government cannot be faulted for lack of attention to the Cordilleras.

“I assure you that what is needed, we will work on them together. And, in fact, I would like to congratulate Mt. Province because it is no longer part of the 10 poorest provinces in our country through the people’s own work and also because of the assistance of the national government.”

The President also pointed out that Tom Killip, the Presidential Assistant for the Cordilleras, is a former mayor of Sagada, Mt. Province, “and so I am sure that he will work and will be making sure that he works with the national government, with the DA, on the needs of Sagada.”

Earlier Monday (Dec. 31), the President, together with First Gentleman Jose Miguel Arroyo and their grandchildren, went spelunking in the famous caves of Sagada.


Camille Beatrice Bauzon
The Manila Times

FILIPINO seamen continue to ply dangerous waters because they see the world for “free”—albeit with all the woes—and the wages beat those back home.

“It’s a high-paying job,” says one merchant marine. “Who wouldn’t want to receive the kind of salary we have?”

A mess man, the lowest rank, receives around $800 a month (P37,600 at the exchange rate of P47 to $1) plus overtime. Officers may get as much as $8,000 a month, or 15 times higher than the wage of many Philippine company executives.

Remittances from seafarers make up 15 percent of the $14.5 billion sent home by Filipino workers abroad. In 2007, the RP sailors’ remittances totaled around $2.2 billion. Employers are required to send a part of a sailor’s salary back home.

The sailors’ paycheck remains largely untouched because of free board and lodging; they spend big time only during port calls.

In the first nine months of 2008, according to the Bangko Sentral ng Pilipinas, Filipino seafarers sent home $2.393 billion—or 43.35-percent more than the $1.669 billion they sent in the same period in 2007.

By comparison, land-based Filipino workers abroad sent $9.87 billion from January to September in 2008.

Since 1987, the Philippines has been the leading supplier of seafarers in the international market, “making it the manning capital of the world,” according to the Philippine Overseas Employment Administration (POEA).

United Filipino Seafarers statistics show there are close to 700,000 Filipino seafarers. In 2007, 266,553 Filipinos were deployed in international passenger and cargo vessels.

They make up about 20 percent —or two out of 10—of the 1.2 million ship workers worldwide.

In a year, they account for around $3 billion of the foreign remittances to the Philippines.

This is a quarter of the total remittances contributed by all Filipino workers abroad, even though seafarers only make up 3 percent of the 8.7 million Filipinos working and living abroad.

The POEA gives most seafarers the “Able Seaman” classification. There were 31,818 able seamen registered last year, a little more than half of them employed in 17,355 positions.

Most of them work in passenger vessels, where 47,782 seafarers were employed in 2007. Some 42,357 worked in bulk carriers and 31,983 labored in container ships.

For recent graduates of maritime schools, competition for jobs is particularly fierce. Of the 25,000 ordinary and able seamen who graduate annually, only 8,000 to 10,000 find a job within a year.

Some 60,000 new students enroll in the counry’s 89 maritime schools. Around 25,000 will complete the three-year course. Most will remain as Ordinary Seaman and only about 5,000 will return to maritime school after a period of “on-the-job” training in order to proceed to the rank of Able Seaman.

Still, the deployment of Filipino seafarers reached 204,951 in 2007, from only 50,604 in 1984.

More Filipinos brave pirate-ruled high seas

Rise in piracy doesn’t deter our sailors
By Camille Beatrice Bauzon, Reporter
The Manila Times

THE alarming rise of piracy in the high seas does not deter Filipinos from working as sailors in dangerous oceans.

“It has no effect whatsoever. In fact, most victims, after the attacks, immediately went back to work in the high seas again,” Nestor Ramirez, president of the United Filipino Seafarers association, told The Manila Times.

“If there is an effect, especially with regards to security, Pinoy seafarers were not affected. But more the other nationalities were,” he continued. “But with regards to Pinoys wanting to be back to their jobs again after being held hostage, there was nothing that indicated a slowdown.”

Filipinos are the most in-demand workers in the high seas, Ramirez said.

International shipping companies prefer them to others because they speak English and are highly trained, industrious and adaptable to a multicultural setting.

After one pirate attack in September, a Filipino seafarer was asked by his Malaysian employer to have a vacation with his family in the Philippines and come back to the seas again this January. All on company time and expense.

2008 saw a huge rise in piracy attacks, particularly in the Gulf of Aden.

That is terrible news to a country that is the world’s biggest source of seafarers, deploying an average of about 270,000 Filipinos annually. “We supply 27 percent of the total seafarers around the world,” Ramirez said.


The numbers continue to increase even if it means traveling across the lawless sea off Somalia. Seafaring is an industry believed to be one of the most dangerous in the world.

“Even after the incidents of piracy, the number of Pinoy seamen wanting to be deployed continues to increase,” said Ramirez.

The demand for Filipinos has actually risen, according to Ramirez, so much so that women are encroaching on what was once a male-dominated job.

“Actually, Filipina seafarers are now serving as marine officers. And we don’t discriminate. The demand is so great that negative competition between seafarers, male or female, does not exist,” he said.

The rise of piracy this year pushed governments and the shipping industry to increase security aboard ships, training crew on how to detect dangers and deal with the situation if taken hostage.

In October, the Philippine Overseas Employment Agency (POEA) started to require double compensation during passage through dangerous waters like that off Somalia and in the Gulf of Aden. Filipinos also now have the option of disembarking at the last safe port before a high-risk zone.

POEA chief Jennifer Jardin-Manalili, aware that the Filipino seaman would not take the safe option, told The Times, the policies “are merely aimed at ensuring that our seafarers are justly compensated for the added risks that they are inevitably exposed to, given the circumstances.”

They “are not meant to solve the security problem or claim to ensure the safety of [Filipinos] and prevent them from being taken hostage by pirates. Much as we want to ensure our seafarers’ safety, piracy is something way beyond POEA’s control,” she says.

The additional pay should not be construed as an incentive, she stresses: “It is more in the nature of a standard hazard pay given to workers whenever they are unavoidably exposed to certain risks in the performance of their duties.”

The compensation is doubled only for the period it takes for a vessel to pass through a high-risk zone, which takes approximately two days, for example, off Somalia. Once the vessel has reached safe waters, the regular rate applies.

Only in the unfortunate event that the seafarer is taken hostage by pirates does the double compensation continue—until the hostage is released.

RP, China most resilient economies in Asia – Bloomberg

David Cagahastian
The Manila Bulletin

The Philippines and China have been cited as the two most resilient economies in Asia amid the global economic crisis, Press Secretary Jesus Dureza said yesterday.

Secretary Dureza said a report by the Bloomberg financial service cited the economies of the Philippines and China as having fared well in 2008 and expected to remain resilient in 2009 even with the expected deterioration of regional economies worldwide.

"It’s encouraging to note that we have been cited in Bloomberg today, as one of the two resilient economies in Asia, along with China. Amidst global financial downturn, we continue to post strong currency and fiscal position," the Press Secretary said.

"The Philippines and China were being cited as the two Asian economies that fared the best in 2008 and that will do well in 2009," he added.

While not being specific on where he got the Bloomberg report citing the Philippine and Chinese economies as having done well in 2008, Dureza still said the citation was "undeniably" a result of President Arroyo’s economic reforms.

"While difficult days are expected ahead, we are in a better position to weather them as long as we keep the course and resist the temptation of divisive politics," Dureza said.

Wow, What A Year!

by Joey Concepcion
The Philippine Star Business
Thursday, January 1, 2009

For some reason, the Ask Go Negosyo Thursday column falls on important days this holiday season. Last Thursday was Christmas Day, and today is New Year's Day. How lucky I am to be able to share my Christmas and New Year message to all.

My column last Thursday, entitled "My Christmas Wish List", surprised my wife and my mom. My wife was especially happy because in a way, I was able to acknowledge all her efforts in Laura Vicuna and Vides Foundations. My mother, who was also surprised, shed tears while reading it. Even my relatives' friends who hardly read my column sent me messages to say it was quite touching. A friend of mine also sent the column to our common friend, who is fighting for his life in Houston. Basing from his last email to all his friends, he is ready to confront his cancer with optimism and the will to live.

Sometimes, we must take time to pause in our lives. Then, we will be able to realize the many things that we are missing. When we are caught up with our businesses, we tend to live in a world of our own. Then, we fail to realize how life is out there. Frankly, I am also guilty of such, especially with my blackberry. With cell phones, we become wired to a material world. These are life's challenges. We know the things that we should avoid, but we keep doing the same old things. I am sure many of the New Year's Resolutions never get done. These resolutions are just symbolically written in paper. My father and my uncle Raul Concepcion, who just celebrated their 77th birthday, are both guilty of this. They have also stopped making their resolutions. Being twins, my baby Isabella is so confused when she sees both of them, wondering if how can there be two 'pappies'. We celebrated their birthday here in Hong Kong, with most family members.

For many of the wealthy, the year 2008 has brought about the most humbling experiences. Many had to experience great anxiety, after seeing their investments tumble and lose value. This makes us realize that in this material world, we can lose what we have in a matter of seconds. The financial catastrophe of many nations, especially of America, is unimaginable. It is like the story of Job in the Bible. He lost everything he had.

Who do we blame for this? Well, we can say that our private bankers and financial counselors are to be blamed. But, equally, it is the greed in each of us. If there is someone out there who would say that he does not have any form of greed, he must not be human. As humans, greed and fear exist in us. We just have to find ways to manage and control these. For me, these traits have caused all these problems and crises. Excessive greed and fear are what caused the problems. It all started with the greed that caused assets to increase beyond its real value. This emboldened people to borrow and leverage beyond their capability. Then, as markets collapsed, we now see extreme fear that pushed all kinds of assets to its all time low.

What lies ahead in 2009 is a big question. How long will this crisis last? And how will it affect us in the Philippines? This is the common question people ask me time and time again. But, maybe one of the best answers came from a sermon during a Sunday mass here in Hong Kong, where we also spent the holidays. The sermon delivered a message addressing the OFWs, who were present in the mass: the greatest love of a parent is shown through the sacrifice to leave home and work overseas for a better future for the family. The pain and loneliness that parents go through, being absent specially during Christmas and birthdays, shows their highest form of love. They are willing to sacrifice just to make sure that the family back home has a better future. This is quite true when we look at the millions of OFW workers and even Filipino-Americans who risk so much just for their families. They are living examples of people taking control of their own destiny. But, there are still count less Filipinos out there who just pray for the pot of gold, hoping that one day it would come without doing anything. I made sure my kids understood what the priest meant, and how lucky we are along with other Filipinos who are able to spend time with their families abroad.

Sometimes, we do take these luxuries in life for granted. It didn't feel like a recession, seeing so many Filipinos in Ocean Terminal, as if we were in Greenbelt shopping area. If the Koreans invaded Manila, the Filipinos invaded Hong Kong this holiday season. Filipinos are very family oriented. We enjoy family reunions during the holidays, bonding with each other until the point of having too much of each other. I guess this is what makes us all different. Imagine how we can use this strength as a nation of Filipinos - united and not divisive, more on inspiring and uplifting one another rather than keeping up with crab mentality, full of optimism and less of pessimism, more of 'yes we can' and none of 'no we cannot'. What happens in 2009 does not lie on what PGMA or this government will do for us. It lies on all of us, focusing on our purpose in life and doing it the best we can. Happy New Year!


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