Saturday, 1 August 2009

Nation mourns passing away of Pres. Cory Aquino


Part II:

Part III:

Arroyo condoles with Aquinos
Week of national mourning set


MANILA, Philippines -- President Gloria Macapagal-Arroyo has expressed her condolences to the family of former President Corazon Aquino who passed away early Saturday, Arroyo's press secretary said.

The President is set to declare a week of national mourning, said Press Secretary Cerge Remonde in a live phone patch from the US where he is accompanying Arroyo who is on official visit there.

Remonde said the President could cut short her trip but that they were going to discuss the matter when they get to New York, their next stop after Washington D.C. where she met President Barack Obama at the White House.

Arroyo is expected to be back in Manila on August 5.

Remonde also said that under the law, all presidents were entitled to a state funeral but added that this would be subject to the family's approval.

Aquino, who was battling colon cancer for about two years, died at 3:18 a.m. of cardio-respiratory arrest, after being confined at the Makati Medical Center for more than a month due to loss of appetite.

Her legacy was the restoration of democracy and its institutions in the country when she led a bloodless, military-backed people power revolt in 1986 that toppled the dictatorship of then President Ferdinand Marcos.

President Arroyo's statement on Cory Aquino

Today, the Philippines lost a national treasure. Cory Aquino helped lead the revolution that restored democracy and rule of law to our nation at a time of great peril.

Our nation will mourn her passing. History was thrust upon her when her noble husband was cut down in the prime of his life as he fought for democracy and rule of law. She picked up the standard from the fallen warrior Ninoy and helped lead our nation to a brighter day.

I am announcing today that we will officially observe a 10-day period of national mourning. Our hearts go out to the family in this hour of grief and sorrow. The nation prays for Cory and her family. - GMANews.TV



READ TIME MAGAZINE: People Power's Philippine Saint: Corazon Aquino, 1933-2009.

Marcoses join Filipinos in mourning Cory's death


MANILA - The family of the late strongman Ferdinand Marcos joined Filipinos around the world in mourning the death of former President Corazon Cojuangco Aquino.

"Ang buong pamilyang Marcos ay nakikiisa sa pagluluksa ng sambayanang Pilipino sa pagpanaw ni dating Pangulong Corazon Aquino (The Marcos family joins Filipinos in mourning former President Corazon Aquino's death)," Ilocos Norte Rep. Ferdinand "Bongbong" Marcos Jr said in a statement.

Marcos said his family knows the pain the Aquino family is going through with the death of the "People Power" icon.

"Muli, ang aming pakikiramay at pakikiisa sa pamilyang Aquino (Again, our condolences and support for the Aquino family)," the congressman said.

Corazon Aquino was propelled into the presidency after the 1986 people's revolt that toppled the Marcos dictatorship.

Aquino restored democracy in the Philippines and a new Constitution with democratic safeguards was adopted.

The former president died 3:18 a.m. Saturday died due to complications from colon cancer. She was 76.

For more news on Cory, log on to:

Stronger Q2 to erase recession fears — Bangko Sentral

P. L. G. Montecillo

Recession fears may be unfounded given likely gains in the second quarter, the Bangko Sentral ng Pilipinas (BSP) said on Friday.

"The drop in consumption in the first quarter was understandable given the very bleak scenario that loomed at the end of 2008," central bank Governor Amando M. Tetangco, Jr. said in an e-mail to reporters.

"Individuals increased precautionary savings. Firms may have also turned cautious while waiting for clearer signals on demand trends," he added.

The economy grew at an annual rate of 0.4% in the first quarter; seasonally adjusted it contracted by 2.3% from the previous quarter. That prompted some officials to say the country was teetering on the brink of a recession — defined as two consecutive quarters of contraction.

Results for the second quarter are scheduled to be released later this month.

"In the second quarter, however, we expect consumption to improve as enrollment-related expenses, among others, are made," Mr. Tetangco said.

"Firms may also be less cautious given early signs of stabilization that continue to be reported in the global financial and goods markets."

Growth in overseas Filipino worker remittances, which continue to buck expectations of a contraction from the likes of the International Monetary Fund and the World Bank, would also lead to a stronger second quarter.

"We remain positive on remittance growth. Remittance flows will continue to be supported by the steady demand for our workers abroad, specially the professional and skilled workers," Mr. Tetangco said.

"The expanded reach of banks and other financial institutions to overseas Filipinos is also expected to further encourage remittance growth going forward."

Growth is also expected to have been boosted due to an increase in government spending, which should have kicked in only in the second quarter since this year’s budget was only signed late in March.

Friday, 31 July 2009

RCBC’s first-half profit rises 11% to P1.691B

Erik de la Cruz
Business Mirror

THE Yuchengco-owned Rizal Commercial Banking Corp. (RCBC) on Thursday said its first-half net income was 11 percent higher at P1.691 billion compared with P1.528 billion last year, reflecting strong gains from both lending and trading businesses.

Excluding the impact of last year’s nonrecurring income on the comparative earnings, the country’s seventh-largest bank by assets said its core net income jumped 72 percent.

The year-ago figure included one-time profits of P547 million from the disposal of acquired assets and other nonrecurring items.

The bank’s second-quarter results were not immediately available.

Net-interest income for the first six months of the year grew 22 percent to P889 million.

“The lending business sustained its strong performance as interest income from loans registered a growth of 24 percent resulting from increased volumes and better yields,” the bank said in a statement.

Other income grew by 23 percent to P2.7 billion

The bank said it had taken advantage of opportunities from the improvement in the financial markets, which resulted in a 23-percent increase in other income to P2.7 billion.

Its foreign-exchange trading delivered a 29-percent increase in income to P302 million.

Its total resources grew a modest 1 percent to P258 billion by end-June, driven by the increase in loans to all market segments. Corporate loans rose 35 percent, loans to small and medium enterprises increased by 29 percent, while consumer loans were up by 7 percent.

“The bank achieved modest growth in resources as a result of its intentional drive to reduce higher cost deposits and to improve yields,” it said. Low-cost deposits increased by P10.6 billion or 13 percent.

The disposal of nonperforming assets reduced the bank’s bad loans ratio to 2.77 percent as of end-June from 4.11 percent a year ago.

“This reflects the bank’s continuing efforts to improve asset quality even as it tightened credit standards during the economic slowdown to protect against higher credit risk,” it said.

The bank also improved its capital adequacy ratio—a measure of capital against the bank’s risk-weighted credit exposures—to 19.35 percent as of end-June against the minimum regulatory requirement of 10 percent. It raised P4 billion in Tier 2, or supplementary capital, by selling unsecured subordinated notes in May.

After taking over a couple of banking institutions in recent months, RCBC remains on the lookout for acquisition opportunities.

It aims to expand its branch network to at least 400 from 332 as of end-June.

It is looking to make its presence felt more in Metro Manila through additional branches and acquire rural banks to further expand it microfinancing business.

Army division completes 29 projects in S. Mindanao

L. D. Desiderio and D. T. Wee

THE ARMED Forces of the Philippines (AFP) has completed 29 development projects worth P49 million in Southern Mindanao for the first half.

Capt. Rosa Maria Cristina R. Manuel, public affairs officer of the 10th Infantry Division, said in a telephone interview yesterday that the completed projects include construction of school-buildings, day care centers and farm-to-market roads, electrification projects, and repair of water systems in villages.

She said the development projects are being implemented with local government units in areas where perceived poverty is high and where the influence of the Communist Party of the Philippines as well as its armed wing, the New People’s Army (NPA), is strong.

"There are 64 development projects of the same kind lined up for the second semester of the year which will be implemented in villages in Davao del Norte and Compostela Valley province," she said.

Meanwhile, the Eastern Mindanao Command has threatened to file charges against those financially supporting the NPA, including businesses paying revolutionary taxes.

Such statement, however, did not sit well with the city’s business chamber.

Simeon P. Marfori II, president of the Davao City Chamber of Commerce and Industry, said the business community would not pay revolutionary taxes if the military and law enforcement agencies had eradicated rebel influence.

"If the military can eradicate the NPA and protect legitimate businesses which pay their taxes to the BIR (Bureau of Internal Revenue), no businessman will be paying [revolutionary tax]," Mr. Marfori told BusinessWorld.

Philippine newspaper readership up in A and B market

Don Gil K. Carreon

PHILIPPINE NEWSPAPERS are not yet going the way of their foreign counterparts whose demise has been hastened by the economic crunch, as readership continues to pick up in the upscale market, a recent study by market research firm Synovate showed.

In a briefing yesterday, Steve Garton, global executive director of media at Synovate, said readership among the A and B classes has gone up to 64% from March to May from 59% in November 2008 to January. "It’s time to debunk the myth that newspapers are dying [here]. They are not," he said.

While overall readership dipped to 34% from 37%, this was mainly caused by a decline in the D and E segments, which have lesser purchasing power than the affluent classes, Mr. Garton said. "This is a good thing. In today’s economy, advertisers are looking for efficient targeting of people. Print has an advantage because it is increasingly a target of the upper-socio," he said.

A recent study by Nielsen Media Research, however, showed that print continues to get a smaller share of the advertising pie, cornering only 5% of the estimated P40.7 billion spent by companies in the first quarter.

Synovate found that the number of people reading newspapers in their offices went up to 24% from only 11% during the previous period.

"[The jump in readership] is driven by [newspaper companies’] push into offices to get white-collar readers," he noted. Those buying their own newspapers dropped to 22% from 34%, while household subscribers dipped to 19% from 21%.

Among the different section of the newspaper, the front page is the most read (42%), followed by sports (12%) and entertainment (7%).

The study noted that Sunday newspapers also saw improved readership among the A and B market, with 53% saying they read these publications, up from 49%.

Meanwhile, cable TV subscription is on the rise — up to 55% from 52% — showing that Filipinos are willing to shell out money for quality content. "Terrestrial TV viewership remained at near saturation levels, with 98% relaxing in front of TV sets," Synovate said.

The research firm also found that Filipinos are shifting toward broadband and away from dial-up subscriptions as connection to the Internet from homes rose to 48% from 43%.

The 2009 figures were compiled in two waves involving 4,000 respondents each, about half of whom were from the Greater Manila Area. The rest were from urban areas of Luzon, Visayas and Mindanao. The study survey had a margin of error of 1.1%.

Thursday, 30 July 2009

PGMA’s meeting with Obama – a pivotal time for US-Asia relations

WASHINGTON DC (PND) – President Gloria Macapagal-Arroyo said today that her meeting with President Barack Obama at the White House here “comes at a pivotal time for US relations in Asia.”

Speaking before the officers and members of the Filipinos International of the United States of America (FILUSA), the Chief Executive said she’s very pleased to have accepted the invitation of President Obama for her to be the “first leader from our region to meet with him at the White House.”

“We’re very hopeful that the Obama administration will put America on the radar screen in Asia,” the President stressed.

The President noted that the visit to the region by Secretary of State Hillary Clinton where she met with Foreign Affairs Secretary Alberto Romulo in Thailand, together with the early outreach by President Obama “sent strong signals that the United States is committed to more robust engagements with the region.”

“The fact that President Obama sought out the Philippines for this first opportunity is a testament to the strong and deep ties between our two nations,” the President also said.

“Kaya maganda iyong mga placard ninyo: Mabuhay RP-US relations,” the President said referring to the wordings in the placards hanging on the walls during the dinner meeting.

The President pointed out that her “expectations for this trip are straightforward: to meet the new US president who is our strong friend and ally and advance the interest of the Philippines.”

She noted that the United States is essential to the country’s economic, diplomatic and national security.

The President stressed that high on the agenda during her meeting with President Obama will be peace and security issues, including ways to continue strengthen regional cooperation and anti-terrorism.

“We will also discuss the global economic crisis that have swept the world, and what we can do to mitigate its impact on the poor especially in Asia and the Philippines,” she said.

Despite the onslaught of the financial global crisis last year, the President said “the country weathered a succession of global crisis in fuel, in food, then in finance…. But never losing focus and with economic fundamentals intact.”

She also made mention that Moody’s upgraded the country’s credit rating in the middle of the global recession citing the resilience of the economy.

“Therefore, I could say that the state of our nation is a strong economy,” the President said.

What President Arroyo did

By Tony Lopez
Manila Times

Economy. Infrastructure. National integration.

These are the key words that characterize the nine years of the administration of President Gloria Arroyo.

She greatly expanded the size of the Philippine economy, in GNP terms, from $74 billion in 2001 (per capita GNP of $967 times population of 76.5 million) to $184.6 billion in 2008 (per capita GNP of $2051 times population of 90 million). In percentage terms the increase was 149 percent—an expansion of one and a half times in eight years, even as a 15 million more Filipinos were born and had to be fed and nurtured.

In GDP terms, the economy expanded from P3.63 trillion in 2001 to P7.42 trillion in 2008, a 104-percent increase or a doubling of the size of the economy. That’s equivalent to an average 13-percent gain per year (104 divided by eight years).

The economy grew for 33 consecutive quarters—the longest sustained expansion in the country’s history. Average GDP growth was 4.85 percent during 2001 to 2008, exceeding per capita population growth of 2.2 percent per year and resulting in per capita growth of 2.65 percent. In the 25 years before that, average per capita GDP growth was 0.2 percent—one of the slowest, if not the slowest, in the world (based on World Bank data).

Today, with a population of 92 million, the Philippines is the 12th largest market in the world. With GDP, in purchasing power parity terms, of $327.8 billion, the Philippines is the 36th largest economy in the world, according to the World Bank’s 2009 World Development Report. With per capita GDP in PPP terms of $3,631.50, Filipinos belong to the world’s middle class.

The result is an equally awesome consumer purchasing power. According to the World Development Indicators 2009, household expenditures account for 80 percent of GDP.

Under the Arroyo administration, heavy investments were made in all kinds of infrastructure—in physical infrastructure like road networks and highways, airports, seaports and nautical highways; in all kinds of energy and power plants; and in information technology and communications.

Investments in airports have enabled Cebu Pacific for instance to create five million passengers who never flew an airplane before.

We have three nautical highways connecting Luzon in the north to Visayas in Central Philippines to Mindanao in the south.

Today, 98 percent of all barangays have electricity. When Arroyo took office, the ratio was less than 70 percent.

Today, 98 percent of the archipelago has a cellular phone signal. Eight of every ten Filipinos have a cell phone. For millions of ordinary Filipinos, their first major investment, their first capital goods acquisition is a cellular phone handset.

It is now possible for the vegetable farmers of the Mountain Province, the fishermen of Iloilo and the rice farmers of Cotabato to surf their phone and get the latest quotations in commodities prices from the Internet. Thus, they know how much their product is worth and how much their hard work is valued.

We have begun to build the mother of all infrastructure networks—Education.

With the expansion in the economy and the investments and advancements in infrastructure and technology is a kind of national integration never seen before in our lifetime.

Physically, all the country’s provinces and nearly all the islands of the archipelago are connected, by land through the road networks, by sea through the nautical highways, by air, through renovated and brand new airports; and wirelessly, through modern communications technology.

For the first time, Filipinos, no matter their age, sex, tribe, religion or political persuasion, can connect and relate to each other. And not only to each other, but to the rest of the world.

This is national integration.

Philippines' DMCI expects to double profits this year


CONSUNJI-LED DMCI Holdings, Inc. expects to book higher profits this year, countering analysts’ earlier negative outlook for most businesses as a result of the global economic meltdown.

At the sidelines of the company’s stockholders’ meeting, DMCI President Isidro A. Consunji said income of the holding company is estimated to reach around P4 billion this year, double than what it posted last year.

This, he said, will be brought about by the better contribution coming from its units, among which include Maynilad Water Services, Inc., Semirara Mining Corp., construction company D.M. Consunji, Inc., DMCI Homes, Inc. and steel fabrication unit Atlantic Gulf & Pacific (AG&P) Co. of Manila, Inc.

Mr. Consunji said Maynilad, for instance, is expected to contribute P1.6 billion to the company, higher than the P30 million it got last year.

Meanwhile, Semirara is seen to increase its net income by a quarter to P1 billion because of the increase in production.

"We project more than a billion pesos this year for Semirara because of more high coal production. Last year, we bought $43 million worth of equipment so its fruits is starting [to kick in already]," Mr. Consunji said.

"The higher volume will offset the lower prices of coal," he added.

Mr. Consunji said Semirara’s sales volume is expected to grow by 5% to four million metric tons of coal this year, of which 1.5 million to 1.8 million metric tons will be exported.

He added that the company has already started to export coal in Thailand, and is doing a trial shipment in Japan and Taiwan.

Plans to sell AG&P, meanwhile, has been temporarily shelved after the first attempt to unload the company’s stake failed last year.

Mr. Consunji said although there are still plans to sell it in the future, the company intends to make AG&P profitable first to attract better offers. "We are actively participating in the business. We already own 98% of the company unlike before when we just hold a 40% stake," he said.

AG&P is expected to contribute P300 million to DMCI’s profits this year having been released recently from its seven-year-long corporate rehabilitation.

DMCI is a holding company engaged in various business. Recently, the company was declared the highest bidder to the 600-megawatt (MW) Calaca power plant and has also bagged the P8-billion contract to extend the Metro Manila Skyway to Alabang, Muntinlupa from Bicutan in Taguig

Mr. Consunji said they are currently not keen on looking for a partner to run Calaca and was supposed to bid with San Miguel Corp. but the latter backed out although he said the conglomerate has indicated its interest to hold an equity position.

Shares in the company yesterday closed 1.36% higher or 0.10 centavos to P7.40.

Philippine consumer confidence up — Nielsen poll


CONSUMER confidence improved in the second quarter as government stimulus plans and stock market gains may have lent Filipinos more optimism, a Nielsen survey released on Monday showed.

The confidence index for the Philippines improved seven notches to 103 from 96 in March, according to data from the Nielsen Global Consumer Confidence survey.

The online poll, conducted from June 15-29, asked 14,029 consumers about their confidence levels and economic outlook. It was a quarterly update complementing semiannual Nielsen reports that are released in April and October.

With its score of 103, the Philippines ranked third overall among 28 surveyed markets and was second in Southeast Asia, behind Indonesia which garnered the top overall spot with 113, a nine-point rise from the previous quarter.

"Consumers in emerging and Asian markets are clearly of the view that they are driving in the recovery lane now," Jonathan Banks, The Nielsen Co.’s business insights director, said in a statement issued on Tuesday.

He said the confidence rebound in the region could be attributed to pump-priming efforts and bourse rallies.

"Asian consumer confidence appears to have been boosted through successful government economic stimulus packages that were speedily and effectively implemented at the onset of the global recession," Mr. Banks said.

"Stock market gains in the BRIC (Brazil, Russia, India, China) and Asian markets have also had a major impact..."

But in a phone interview, University of Asia and the Pacific (UA&P) economist Peter Lee U expressed apprehension on linking consumer confidence growth to the state stimulus package, as implementation had room for improvement.

He regarded recent gains in the stock market as a more probable driver but only insofar as the respondent sample was concerned.

"Even if they [the online respondents] are not invested in the stock market, they have enough appreciation [of the positive implications] when it is rising," Mr. Lee U said, pointing to the greater access of wired Filipinos to economic news.

"When it goes up, people tend to be happier and spend more."

The average Filipino, he said, is not as exposed to the stock market so the results of the survey may not be representative of the general population.

For his part, National Economic and Development Authority Director Dennis M. Arroyo said "Asians in general have heard of the ’green shoots’ phenomena," which could have spurred consumer confidence.

"In our case, it is the overseas Filipino workers (OFWs) who are seeing it. The news they get points to a recovery in fourth quarter," Mr. Arroyo said in a phone interview yesterday.

He also agreed with the observation that the stock market uptick could be boosting confidence, saying the trend will likely continue into the year "barring any grave geopolitical events."

Philippine inflation may hit 22-year low


CONSUMER PRICES may have contracted for the first time in over two decades this month, the Bangko Sentral ng Pilipinas (BSP) yesterday said.

In a text message to reporters, central bank Governor Amando M. Tetangco, Jr. offered a July inflation range of -0.3% to +0.6%.

The forecast is lower than the June result of 1.5%, and a negative result would be the first since February 1987’s -0.3%.

Mr. Tetangco gave no clear indication on the direction of monetary policy going forward, but market players said an end to a rate-cutting cycle was possible.

Negative inflation is usually a sign of an excessive demand slowdown. The central bank, however, noted that a contraction this month would be due to base effects.

"The low inflation numbers for July are being driven mainly by base effects of high commodity prices during the same month in 2008," Mr. Tetangco said. "In particular, global prices of petroleum products peaked in July 2008 around $140 a barrel."

"The disinflationary forces therefore are mainly a result of prices normalizing from spikes experienced last year. The BSP expects base effects to dissipate as the year progresses," he added, noting that inflation will likely pick up in the months ahead.

"Based on latest BSP forecast readings, full-year inflation for 2009 and 2010 is still expected to settle well within the target range of 2.5-4.5% and 3.5-5.5%, respectively," Mr. Tetangco said.

The central bank forecasts inflation to average at 3.3% this year.

"With inflation forecasts over the policy horizon within target levels, we consider the current policy posture sufficiently supportive of the growth dynamic of the Philippine economy," Mr. Tetangco said.

With the next Monetary Policy stance meeting set in three weeks’ time on Aug. 20, he said the BSP would "revisit policy settings and act as deftly possible, based on forward-looking indicators of inflationary pressures, the strength of demand and other relevant information."

Amid inflation declining from a peak of 12.5% last August, the BSP has cut its key overnight borrowing rate by a total of 200 basis points since December last year to 4%, a record low.

The BSP has also implemented several liquidity-enhancing measures to complement the rate cuts, including the tripling of its rediscounting budget and a reduction in bank reserve requirements. These represent the longest monetary policy easing cycle in the BSP’s history.

Marcelo E. Ayes, senior vice-president for financial markets at Rizal Commercial Banking Corp., said "The question is, has the BSP reached the end of its easing mode are we returning to the neutral stance?"

"I think the BSP will be looking at second-quarter growth. If that is still threatened, then may be rates can be cut by another quarter-point," he said.

The Philippine economy grew by just 0.4% in the first quarter, slower than the government’s 1.8-2.8% target.

This forced a cut in the government’s full-year goal to 0.8-1.8% from the previous 3.1-4.1%.

"I think the BSP is just giving themselves a little flexibility," Security Banking Corp. Treasurer Rafael S. Algarra said.

"Aside from inflation, I think growth is probably going to be a bigger consideration," he added.

Second-quarter growth is scheduled to be released next month.

"Between today and the policy meeting, the BSP will be able to see some data which would likely indicate how much the country grew in the second quarter," Mr. Algarra said.

Philippine Savings Bank posts 24% profit rise in H1, keeps ’09 goal

Erik de la Cruz
Business Mirror

PHILIPPINE Savings Bank (PSBank) posted a 24-percent increase in net income for the first six months of 2009 with both interest income and trading gains from government securities rising at double-digit pace.

The consumer-banking unit of the Metrobank Group on Wednesday said it had a first-half net income of P623 million after setting aside loan-loss provisions of P542 million. It did not disclose its results for the second quarter.

The bank previously reported a 21-percent increase in first-quarter net income to P303.73 million.

Given its improved performance, the bank is keeping its full-year net income guidance of P1.1 billion, said its president Pascual Garcia III.

Amid the economic downturn which, according to the international credit-rating agencies, might result in loan defaults, PSBank increased its loan- loss provisions for the first six months from P240 million in June 2008.

Net interest income rose 27 percent to P2.25 billion, with the bank’s loan portfolio expanding by 17 percent. Personal loans increased by 16 percent, while mortgage and auto loans grew by 13 percent and 11 percent, respectively.

Consumer loans accounted for the bank’s total loan portfolio. The first half saw the bank lending aggressively to big corporate borrowers.

Noninterest income increased 33 percent to P826 million, with “strong growth” also coming from the bank’s investments in government securities. The bank attracted additional deposits, which increased by 22 percent to P68 billion, with peso deposits expanding by 21 percent and dollar deposits by 25 percent.

“Customers are now more prudent with their money and opt to build on their savings rather than spend it on unnecessary purchases,” Pascual said in a statement. “This protects them from uncertainties brought about by the global crisis.”

One of the biggest thrift banks in the country, PSBank’s total assets rose to P83.6 billion as of end-June from P81.56 billion as of end-March.

Its capital adequacy ratio, a measure of a bank’s capital strength against risk-weighted credit risks, stood at 14.95 percent—above the minimum regulatory requirement of 10 percent—while its return on average equity was at 13.63 percent as of end-June.

The bank ended the first half with 165 branches and 248 automated teller machines, and this month opened its 166th branch at Puerto Princesa in Palawan. It plans to open nine more branches before the year ends.

Of the 100 additional automated teller machines it plans to put up this year, 66 had been made operational in the first half, Garcia said.

The bureaucratic disease

Outside the Box
John Mangun
Business Mirror

Once upon a time the United States government had a vast scrap yard in the middle of a desert. Congress said, “Someone may steal from it at night.” So they created a night-watchman position and hired a person for the job.

Then Congress said, “How does the watchman do his job without instructions?” So they created a planning department and hired two persons, one to write the instructions, and the other to do time studies.

Then Congress said, “How will we know the night watchman is doing the tasks correctly?” So they created a quality-control department and hired two people, one to do the studies and the other to write the reports.

Then Congress said, “How are these people going to get paid?” So they created the positions of a time-keeper and a payroll officer and hired two people.

Then Congress said, “Who will be accountable for all of these people?” So they created an administrative section and hired three people, an administrative officer, assistant administrative officer, and a legal secretary.

Then Congress said, “We have had this command in operation for one year and we are $18,000 over budget, we must cut back overall cost.”

So they fired the night watchman.

Bureaucracy has plagued the world since the first leader decided that some responsibility for government had to be put in hands other than his own. The ancient Egyptians had a far-reaching one, with the country divided into sections, administered by what amounted to “little pharaohs.” The pharaoh was, in theory, the only person who could own land, the only judge settling disputes, the only priest of the religion, and the only warrior. Everyone else was merely assistant to his power and rule. With the creation of the “little pharaohs” government bureaucracy was invented. Although the junior pharaohs supposedly answered only to their lord and master, they pretty much did whatever they wanted. And in turn, they created positions under them, increasing the great Egyptian bureaucracy.

As time passed, the rulers became dependent on the underlings to be able to administer their jobs. Although the bureaucracy was to stand as a support group for the ruler, it took on a life of its own, literally. The ruler might die, but the bureaucracy he created lived on and on. And like any other living thing, it gave birth to baby bureaucracies, thus increasing its influence and control of the government.

Government bureaucracies are, of course, created with the greatest and noblest of intentions. In 1997 for example, then US President Jimmy Carter signed into law the US Department of Energy (DOE). The mandate was to lessen US dependence on foreign-energy oil. It is now 32 years later and the budget for this “necessary” department is at $24.2 billion a year. They have 16,000 federal employees and approximately 100,000 contract employees. And the United States is more dependent on foreign-produced oil that ever before. The DOE assumed the responsibilities of the Federal Energy Administration, the Energy Research and Development Administration, the Federal Power Commission, and programs of various other agencies.

The Department of Energy has moved into an area far removed from its original mandate. It now regulates, or tries to regulate anything and everything remotely connected with “energy,” including light bulbs and building insulation.

Government bureaucracies have an insatiable quest for more power and control. It is an inborn disease. And that is the problem with new government agencies within the bureaucracy.

They are supposed to rationalize and make more efficient the tasks of existing agencies. In fact, what usually happens is that they become an enormous bureaucratic organization overseeing several other large bureaucratic organizations. There is little increase in efficiency and productivity. And they take on a life of their own, spawning more and agencies, growing ever larger.

For the last five years, the administration has certified as urgent legislation creating the Department of Information and Communications Technology (DICT). The purpose is to “be a single aggregator for all IT and communications government agencies.” The DICT is expected to integrate other agencies from the Department of Transportation and Communications and Department of Science and Technology.

The government has a Commission on Information and Communications Technology (CICT) and it does a good job by all accounts. But is there a need to make it a permanent department of government? And yes, it would be permanent. CICT chief Ray Anthony Roxas-Chua: “The problem with the CICT just being a commission is that it can be easily demolished by the next administration.” That might be a good thing for all government department: non-permanency.

As much as I want the Philippines to move forward faster in developing our IT resources, I have this distrust of all government agencies. Someday, another future secretary of the DICT might just realize that pencils and ball pens are also part of information and communications technology, needing regulation and development.

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Wednesday, 29 July 2009

San Miguel reaps rich rewards for its audacity

By Roel Landingin
Financial Times

San Miguel, the Philippine food and drinks maker that is diversifying into heavy industry, displayed extraordinary boldness when it acquired large stakes in two of the country’s biggest companies in October last year just as Manila’s stock index fell the most in more than two decades.

Now San Miguel is displaying the same audacity in its assessment of the success of its acquisitions in new businesses ranging from electricity distribution, petrol refining and telecommunications.

“Overall, if you look at it, the diversification is very successful,” Ramon Ang, San Miguel president, said last week.

San Miguel bought 27 per cent of Manila Electric (Meralco) in October last year at 90 pesos a share, twice the price of 44.50 pesos at the time. But Meralco’s shares have quadrupled this year, on Tuesday surging by a fifth to close at an all-time high of 272.50 pesos.

Investors are speculating that Meralco’s two biggest owners – San Miguel and Philippine Long Distance Telephone – could buy each other out and make a tender offer to other shareholders.

Mr Ang says San Miguel’s acquisitions, which were announced shortly after the global financial crisis took a turn for the worse, helped infuse life into an otherwise lethargic stock market.

Few companies can match such impact, or daring.

Philippines' Banco de Oro 2nd-quarter profit up 9%

Erik de la Cruz
Business Mirror

BANCO de Oro Unibank (BDO), the country’s largest bank, posted a 9-percent increase in net income for the second quarter to P1.1 billion on higher interest and fee-based income and improved trading gains.

The bank of retail magnate Henry Sy on Tuesday said its quarterly earnings rose from P1 billion in the same period last year and were up 11 percent compared with the previous quarter.

 “Sustaining earlier gains, the bank’s loans, deposits, net interest income and fee-based income continued to grow. Income from trading activities also improved with a more stable financial environment,” BDO said in a statement.

For the first half of the year, the bank’s net income was down 10 percent at P2.1 billion. Although first-quarter earnings hit P1 billion, the figure was 25-percent lower compared with the year-ago bottom line which was boosted by one-off gains.

But the first-half net income on a recurring basis was 62-percent higher.

In June, BDO chairperson Tessie Sy-Coson said the bank was keeping its full-year profit guidance of P5.5 billion intact despite a much weaker-than-expected economic growth of 0.4 percent in the first quarter, which prompted the government and many economists to scale down growth projections this year.

The bank said broad-based demand for loans resulted in a 28-percent increase in gross customer loans to P414.4 billion by the end of June. Deposits, meanwhile, increased 26 percent to P627.1 billion with low-cost deposits on the rise and some branches having been relocated to “high-growth” areas.

 Net interest income for the six-month period rose 32 percent to P14.3 billion given an expanded loan portfolio and an “improved funding mix,” the bank said.

Fee-based income went up 11 percent to P4.5 billion on higher contributions from fund management, remittance, credit card, cash management, investment banking and bancassurance services.

 Trading and foreign-exchange gains improved 46 percent to P1.9 billion amid a “more stable” financial market.

The bank, however, maintained a conservative stance amid a weak economy, boosting provisions for probable losses on loans by 64 percent to P2.5 billion.

In June, BDO president Nestor Tan said the bank was looking at booking P5.26 billion in provisions for probable loan losses this year, a slightly bigger amount compared with last year’s total provisions of P5.23 billion.

Based on the guidance announced in June, the bank was confident that net income this year would rise by 172 percent from P2.18 billion in 2008, with gross loans seen increasing by 15 percent to P451.1 billion and investment assets by 25 percent to P460.5 billion.

The bank had also projected a 19-percent expansion in its asset base to P950.8 billion by the end of 2009.

Bank officials had not ruled out further acquisitions after recently signing an agreement to acquire GE Money Bank from GE Capital, the financial-services unit of New York-listed General Electric Co.

The acquisition was expected to bring into BDO’s network an additional 31 branches, assets of P10 billion, deposits of P8.4 billion and loan accounts of P6 billion. Under the agreement, GE Capital would acquire a 1.5-percent stake in BDO as payment and was given an option—exercisable within six months—to further increase its stake to 10 percent.

Tuesday, 28 July 2009

President Arroyo's SONA 2009

President Gloria Macapagal Arroyo's 9th State of the Nation Address during the 3rd Joint Regular Session of the 14th Congress of the Republic of the Philippines
Session Hall, Batasan Pambansa Complex
Batasan Hills, Quezon City
July 29, 2009

Thank you.

Ladies and Gentlemen, Good afternoon.

Before I begin my report please join me first in a moment of prayer for President Aquino.

Senate President Enrile, Speaker Nograles, Senators, Representatives, Vice President de Castro, Former President Ramos, Chief Justice Puno, Ambassadors, friends:

The past twelve months have been a year for the history books. Financial meltdown in the West spread throughout the world.

Tens of millions lost their jobs; billions across the globe have been hurt -- the poor always harder than the rich. No one was spared.

It has affected us already. But the story of the Philippines in 2008 is that the country weathered a succession of global crises in fuel, in food, then in finance and finally the economy in a global recession, never losing focus and with economic fundamentals intact. (applause)

A few days ago Moody's upgraded our credit rating, citing the resilience of our economy. The state of our nation is a strong economy. (applause) Good news for our people, bad news for our critics. (applause)

I did not become President to be popular. To work, to lead, to protect and preserve our country, our people, that is why I became President. (applause) When my father left the Presidency, we were second to Japan. I want our Republic to be ready for the first world in 20 years.

Towards that vision, we made key reforms. Our economic plan centers on putting people first. Higit sa lahat, ang layunin ng ating mga patakaran ay tulungan ang masisipag na karaniwang Pilipino. (applause) New tax revenues were put in place to help pay for better healthcare, more roads, and a strong education system. Housing policies were designed to lift up our poorer citizens so they can live and raise a family with dignity. Ang ating mga puhunan sa agrikultura ay naglalayong kilalanin ang ating mga magsasaka bilang backbone ng ating bansa, (applause) at bigyan sila ng mga modernong kagamitan to feed our nation and feed their own family.

Had we listened to the critics of those policies, had we not braced ourselves for the crisis that came, had we taken the easy road much preferred by politicians eyeing elections, this country would be flat on its back. (applause) It would take twice the effort just to get it back again on its feet—to where we are now because we took the responsibility and paid the political price of doing the right thing. (applause) For standing with me and doing the right thing, thank you, Congress. (applause)

The strong, bitter and unpopular revenue measures of the past few years have spared our country the worst of the global financial shocks. They gave us the resources to stimulate the economy. Nabigyan nila ang pinakamalaking pagtaas ng IRA ng mga LGU na P40 billion itong taon, (applause) imparting strength throughout the country at every level of government.

Compared to the past we have built more and better infrastructure, including those started by others but left unfinished. The Subic-Clark-Tarlac Expressway is a prime example of building better roads. (applause) It creates wealth as the flagship of the Subic-Clark corridor.

We have built airports of international standard, upgraded domestic airports, built seaports and the RORO system. I ask Congress for a Philippine Transport Security Authority Law. (applause)

Some say that after this SONA, it will be all politics. Sorry, but there's more work. (applause)

Sa telecommunications naman, inatasan ko ang Telecommunications Commission na kumilos na tungkol sa mga sumbong na dropped calls at mga nawawalang load sa cellphone. (applause) We need to amend the Commonwealth-era Public Service Law. And we need to do it now. (applause)

Kung noong nakaraan, lumakas ang electronics, today we are creating wealth by developing the BPO and tourism sectors as additional engines of growth. Electronics and other manufactured exports rise and fall in accordance with the state of the world economy. But BPO remains resilient. With earnings of $6 billion and employment of 600,000, the BPO phenomenon speaks eloquently of our competitiveness and productivity. (applause) Let us have a Department of ICT. (applause)

In the last four years tourism almost doubled. It is now a $5 billion industry. (applause)

Our reforms gave us the resources to protect our people, our financial system and our economy from the worst of shocks that the best in the west failed to anticipate. (applause)

They gave us the resources to extend welfare support and enhance spending power.

For helping me raise government salaries through Joint Resolution 4, thank you Congress. (applause)

Cash handouts give the most immediate relief and produce the widest stimulating effect. Nakikinabang ang 700,000 na pinakamahihirap na pamilya sa programang Pantawid Pamilya. (applause)

We prioritize projects with the same stimulus effects plus long-term
contributions to progress.

Sa pagpapamahagi ng milyun-milyong ektaryang lupa, 700,000 na katutubo at mahigit isang milyong benepisyaryo ng CARP ay taas-noong may-ari na ng sariling lupa. (applause) Hinihiling ko sa Kongreso na ipasa agad ang pagpapalawig ng CARP, (applause) at dapat ma-condone ang P42 billion na land reform liabilities dahil 18% lamang ang nabayaran mula 1972. (applause) It's timely because it will unfreeze the rural property market. Ang mahal kong ama ang nag-emancipate ng mga magsasaka. Ii-mancipate naman natin ngayon ang titulo. (applause)

Nakinabang ang pitong milyong entrepreneurs sa P165 billion in microfinance loans.

Nakinabang ang sandaan libo sa emergency employment ng ating economic resiliency plan. Kasama natin ngayon ang isa sa kanila, si Gigi Gabiola. (applause) Dating household service worker sa Dubai, ngayon siya ay nagtatrabaho sa DOLE. Good luck, Gigi. (applause)

Nakinabang ang isang milyong pamilya sa programang pabahay at palupa, mula Pag-Ibig, NHA, community mortgage program, certificates of lot award, at saka yung inyong loan condonation. Salamat. (applause)

Our average inflation is the lowest since 1966. Last June, it dropped to 1.5%. (applause) Paano?

Proper policies lowered interest rates, which lowered costs to business and consumers.

Dahil sa ating mga reporma, nakaya nating ibenta ang bigas NFA sa P18.25 per kilo kahit tumaas ang presyo sa labas mula P17.50 hanggang P30 dahil sa kakulangan sa supply sa mundo. Habang, sa unang pagkakataon, nagawa nating itaas ang pamimili ng palay sa mga magsasaka, P17 mula sa P11. (applause)

Dahil sa ating mga reporma, nakaya nating mamuhunan sa pagkain -- anticipating an unexpected global food crisis. Nakagawa tayo ng libu-libong kilometro ng farm-to-market roads at, kasama ng pribadong sector, natubigan ang dalawang milyong ektarya. (applause) Mga Badjao gaya ni Tarnati Dannawi (applause) ay tinuruan ng modernong mariculture. Umabot na sa P180,000 ang kinita niya mula noong nakaraang taon. Congratulations, Tarnati. (applause) We will help more fisherfolk shift to fish farming with a budget of P1 billion. (applause)

Dahil dumarami na naman daw ang pamilyang nagugutom, mamumuhunan tayo nga panibago sa ating hunger mitigation program na sa nakaraan ay napatunayang mabisa. Tulungan niyo ako dito Kongreso. (applause)

Mula pa noong 2001, nanawagan na tayo ng mas murang gamot. Nagbebenta tayo ng gamot na kalahating presyo sa libu-libong Botika ng Bayan at Botika ng Barangay sa maraming dako ng bansa. Our efforts prodded the pharmaceutical companies to come up with low-cost generics and brands like RiteMed. I supported the tough version of the House of the Cheaper Medicine law (applause) over the weak version of my critics. (applause) The result: the drug companies volunteered to bring down drug prices, slashing by half the prices of 16 drugs. Thank you, Congressmen Cua, Alvarez, Biron and Locsin. (applause)

Pursuant to law, we are placing other drugs under a maximum retail price. To those who want to be President, this advice: If you really want something done, just do it. Do it hard, do it well. Don't pussyfoot. Don't pander. And don't say bad words in public. (applause)

Sa health insurance, sakop na ang 86% ng ating populasyon.

Sa Rent Control Law ng 2005 hanggang 2008, di pwedeng lumampas ng 10% ang pagtaas ng upa taon-taon. Ayon sa kakapirma nating batas may isang taong moratorium, tapos hanggang 7% lamang ang maaaring pagtaas. Salamat, Kongreso. (applause)

Noong isang taon, nabiyayaan ng tig-P500 ang mahigit pitong milyong tahanan bilang Pantawid Koryente ng mga small electricity users.

Yung presyo ng koryente, ang EPIRA natin ang sagot. EPIRA dismantled monopoly. Ngunit minana natin yung power purchase agreements, kaya hindi pa natin makakamtan yung buong intended effect. Pero happy na rin tayo, dahil isang taon na lamang iyan. The next generation will benefit from low prices from our EPIRA. Thank you. (applause)

Samantala, umabot na sa halos lahat ng barangay ang elektrisidad. We increased indigenous energy from 48% to 58%. Nakatipid tayo ng dollars tapos malaki pa ang na-reduce na oil consumption. The huge reduction in fossil fuel is the biggest proof of energy independence and environmental responsibility. (applause) Further reduction will come with the implementation of the Renewable Energy Act and the Biofuels Act. Again thank you. (applause)

The next generation will also benefit from our lower public debt to GDP ratio. It declined from 78% in 2000 to 55% in 2008. We cut in half the debt of government corporations from 15% to 7%. Likewise foreign debt from 73% to 32%. (applause) Kung meron man tayong malaking kaaway na tinalo, walang iba kundi conjured the demon of foreign debt. We exorcised it. (applause)

The market grows economies. A free market, not a free-for-all.

To that end, we improved our banking system to complement its inherent conservatism. The Bangko Sentral has been prudent. Thank you, Governor Tetangco, (applause) for being so effective. The BSP will be even more effective if Congress will amend its Charter. (applause)

We worked on the Special Purpose Vehicle Act, reducing non-performing loans from 18% to 4% and improving loan-deposit ratios.

Our new Securitization Law did not encourage the recklessness that brought down giant banks and insurance companies elsewhere and laid their economies to waste. In fact, it monitors and regulates the new-fangled financial schemes. Thank you, Congress. (applause)

We will work to increase the tax effort through improved collections and new sin taxes to further our capacity to reduce poverty and pursue growth. Revenue enhancement must come from the Department of Finance plugging leaks and catching tax and customs cheats. I call on tax paying citizens and tax paying businesses help the BIR and Customs cut those cheats. (applause)

Taxes should come from alcohol and tobacco and not from books. Tax hazards to lungs and livers, do not tax minds. (applause) Ang kita mula sa buwis ng alak at sigarilyo ay dapat gamitin sa kalusugan at edukasyon. Pondohan ang Philhealth premiums ng pinakamahihirap. Pondohan ang mas maraming classroom at computers.

Pardon my partiality for the teaching profession. I was a teacher. (applause)

Kaya namuhunan tayo ng malaki sa education at skills training.

Ang magandang edukasyon ay susi sa mas magandang buhay, the great equalizer that allows every young Filipino a chance to realize their dreams.

Nagtayo tayo ng 95,000 na silid-aralan, nagdagdag ng 60,000 na guro, naglaan ng P1.5 billion para sa teacher training, especially for 100,000 English teachers. (applause)

Isa sa pinakamahirap sa Millennium Development Goals ay yung Edukasyon para sa Lahat pagdating ng 2015. Ibig sabihin, lahat ng nasa tamang edad ay dapat nasa primary school. Halos walang bansang makakatupad nito. Ngunit nagsisikap pa rin tayo. Nagtayo tayo ng mga paaralan sa higit sanlibong barangay na dati walang eskwelahan upang makatipid ng gastos sa pamasahe ang mga bata. (applause) Tinanggal natin ang miscellaneous fees para sa primary school. Hindi na kailangan mag-uniporme sa mga estudyante sa public school.

In private high schools, we finance half of the students.

We have provided college and post-graduate education for over 600,000 scholars. One of them, Mylene Amerol-Macumbal, finished Accounting at MSU-IIT, (applause) then she went to law school, and placed second in the last bar exams, (applause) the first Muslim woman bar topnotcher. (applause) Congratulations!

In technical education and skills training, we have invested three times that of three previous administrations combined. (applause) Narito si Jennifer Silbor, isa sa sampung milyong trainee. Natuto siya ng medical transcription. Now, as an independent contractor and lecturer for transcriptions in Davao, kumikita siya ng P18,000 bawat buwan. Good job, Jennifer. (applause)

The Presidential Task Force on Education headed by Jesuit educator Father Bienvenido Nebres has come out with the Main Education Highway towards a Knowledge-Based Economy. It envisions seamless education from basic to vocational school or college.

It seeks to mainstreams early childhood development in basic education. Our children are our most cherished possession. In their early years we must make sure they get a healthy start in life. They must receive the right food for a healthy body, the right education for a bright and inquiring mind -- and the equality of opportunity for a meaningful job. (applause)

For college admission, the Task Force recommends mandatory Scholastic Aptitude Tests. It also recommends that private higher education institutions should be harmonized with state universities and colleges, and also the CHED should oversee local universities and colleges. For professions seeking international recognition -- engineering, architecture, accountancy, pharmacy and physical therapy --it recommends radical reform: 10 years of basic education, two years of pre-university before three years of university.

Our educational system should make the Filipino fit not just for whatever jobs happen to be on offer today, but also for whatever economic challenge life will throw in their way. (applause)

Sa hirap at ginhawa, pinapatatag ang ating bansa ng ating Overseas Filipinos. Iyong padala nilang $16 billion noong isang taon ay record. Itong taon, mas mataas pa. (applause)

I know that this is not a sacrifice joyfully borne. This is work where it can be found -- in faraway places, among strangers with different cultures. It is lonely work, it is hard work.

Kaya nagsisikap tayong lumikha dito sa atin ng mga trabahong maganda ang sahod, so that overseas work will just be a career choice, not the only option for a hard-working Filipino. (applause)

Meanwhile, we should make their sacrifices worthwhile. Dapat gumawa tayo ng mas epektibong proteksyon at pagpapalawak ng halaga ng kanilang pinagsikapang sweldo. That means stronger consumer protection for OFWs investing in property and products back home. Para sa kanila, pinapakilos natin ang Investors Protection Task Force. (appause)

Hindi ako nag-aatubiling bisitahin ang ating taong bayan at kanilang mga host sa buong mundo - mula Hapon hanggang Brazil, mula Europa at Middle East hanggang sa American Midwest, nakikinig sa kanilang mga problema at pangangailangan, inaalam kung paano sila matulungan ng ating pamahalaan -- by working out better policies on migrant labor, or by saving lives and restoring liberty.

Pagpunta ko sa Saudi, pinatawad ni Haring Abdullah ang pitong daang OFW na nasa preso. (applause) Pinuno nila ang isang buong eroplano at umuwi kasama ko. (applause)

Mula sa ating State Visit sa Espanya, it has become our biggest European donor. (applause) At si Haring Juan Carlos ay nakikipag-usap sa ibang mga bansa para sa ating mga namomroblemang OFW. Ganoon di si Sheikh Khalifa, ang Prime Minister ng Bahrain. (applause)

Pagpunta ko sa Kuwait, Emir Al-Sabah commuted death sentences. (applause) We thank all our leaders, all world leaders who shown compassion with our workers. (applause)

Our vigorous international engagement has helped bring in foreign investment. Net foreign direct investments multiplied 15 times during our administration. Kasama ng ating mga Together with our OFWs, they more than doubled our foreign exchange reserves. Pinalakas ang ating piso at naiwasan ang lubhang pagtaas ng presyo. They upgraded our credit because while the reserves of our peers have shrunk this past year, ours reserves grew by $3 billion. (applause)

Our international engagement has also corrected historical injustice. The day we visited Washington, Senator Daniel Inouye successfully sponsored benefits for our veterans as part of America's stimulus package.

I have accepted the invitation of President Obama to be the first Southeast Asian leader to meet him at the White House, later this week. (applause)

That he sought the Philippines testifies to our strong and deep ties.

High on our agenda will be peace and security issues. Terrorism: how to meet it, how to end it, how to address its roots in injustice or prejudice -- and first and always how to protect lives.

We will discuss nuclear non-proliferation. The Philippines will chair the review of the nuclear weapons non-proliferation Treaty in New York in May 2010. The success of the talks will be a major diplomatic achievement for us. (applause)

There is a range of other issues we will discuss, including the global challenge of climate change, especially the threat to countries with long coastlines. And there is the global recession, its worse impact on poor people, and the options
that can spare them from the worst.

In 2008 up to the first quarter of 2009 we stood among only a few economies in Asia-Pacific that did not shrink. (applause) Compare this to 2001, when some of my current critics were driven out by people power. Asia was then surging but our country was on the brink of bankruptcy. (applause)

Since then, our economy has posted uninterrupted growth for 33 quarters; more than doubled its size from $76 billion to $186 billion. The average GDP growth from 2001 to the first quarter of 2009 is the highest in 43 years. (applause)

Bumaba ang bilang ng mga nagsasabing mahirap sila sa 47% mula 59%. Maski lumaki ang ating populasyon, nabawasan ng dalawang milyon ang bilang ng mahihirap. (applause) GNP per capita rose from a Third World $967 to $2,000. (applause) Lumikha tayo ng walong milyong trabaho, an average of a million a year, much, much more than at any other time. (applause)

In sum:

1. We have a strong economy in a strong fiscal position to withstand political shocks.

2. We built new modern infrastructure and completed unfinished ones.

3. The economy is more fair to the poor than ever before. (applause)

4. We are building a sound base for the next generation.

5. International authorities have taken notice that we are safer from environmental degradation and man-made disasters. (applause)

As a country in the path of typhoons and in the Pacific Rim of Fire, we must be as prepared as the latest technology permits to anticipate natural calamities when that is possible; to extend immediate and effective relief when it is not.The mapping of flood and landslide-prone areas is almost complete. Early warning, forecasting and monitoring systems have been improved, with weather tracking facilities in Subic, Tagaytay, Mactan, Mindanao, Pampanga.

We have worked on flood control infrastructure like those for Pinatubo, Agno, Laoag, and Abucay, which will pump the run off waters from Quezon City and Tondo flooding Sampaloc. This will help relieve hundreds of hectares in this old city of its age old woe. (applause)

Patuloy naman iyong Camanava, dagdag sa Pinatubo, Iloilo, Pasig-Marikina, Bicol River Basin, at mga river basin ng Mindanao. (applause)

The victims of typhoon Frank in Panay should receive their long-overdue assistance package. I ask Congress to pass the SNITS Law. (applause)

Namana natin ang pinakamatagal ng rebelyon ng Komunista sa buong mundo.

Si Leah de la Cruz isa sa labindalawang libong rebel returnee. Sixteen pa lang siya nang sumali sa NPA. Naging kasapi sa regional White Area Committee, napromote sa Leyte Party Committee Secretary. Nahuli noong 2006. She is now involved in an LGU-supported handicraft livelihood training of former rebels. We love you, Leah! (applause)

There is now a good prospect for peace talks with both the Communist Party of the Philippines and the MILF, with whom we are now on ceasefire. (applause)

We inherited an age-old conflict in Mindanao, exacerbated by a politicallypopular but near-sighted policy of massive retaliation. This only provoked the
other side to continue the war.

In these two internal conflicts, ang tanong ay hindi, "Sino ang mananalo?" kundi, bakit pa ba kailangang mag-laban ang kapwa Pilipino tungkol sa mga isyu na alam naman nating lahat na di malulutas sa dahas, at mareresolba lang sa paraang demokratiko? (applause)

There is nothing more that I would wish for than peace in Mindanao. (applause) It will be a blessing for all its people, Muslim, Christian and Lumads. It will show other religiously divided communities that there can be common ground on which to live together in peace, harmony and cooperation that respects each other's religious beliefs. (applause)

At sa lahat ng dako ng bansa, kailangan nating protektahan ang ating mga mamamayan kontra sa krimen' -- in their homes, in their neighborhoods, in their communities. How shall crime be fought? With the five pillars of justice, including crime fighters. We call on Congress to fund more policemen on the streets. (applause)

Real government is about looking beyond the vested to the national interest, setting up the necessary conditions to enable the next, more enabled and more empowered generation to achieve a country as prosperous, a people as content, as ours deserve to be. (applause)

The noisiest critics of constitutional reform tirelessly and shamelessly attempted Cha-Cha when they thought they could take advantage of a shift in the form of government. Now that they feel they cannot benefit from it, they oppose it. (applause)

As the seeds of fundamental political reform are planted, let us address the highest exercise of!

In 2001, I said we would finance fully automated elections. We got it, thanks to Congress. (applause)

At the end of this speech I shall step down from this stage but not from the Presidency. (applause) My term does not end until next year. (applause) Until then, I will fight for the ordinary Filipino. The nation comes first. There is much to do as head of state -- to the very last day. (applause)

A year is a long time. Patuloy ang pamumuhunan sa tinatawag na three E's ng ekonomiya, environment at edukasyon. There are many perils that we must still guard against.

A man-made calamity is already upon us, global in scale. As I said earlier, so far we have been spared its worst effects but we cannot be complacent. We only know that we have generated more resources on which to draw, and thereby created options we could take. Thank God we did not let our critics stop us. (applause)

As the campaign unfolds and the candidates take to the airwaves, I ask them to talk more about how they will build up the nation rather than tear down their opponents. (applause) Give the electorate real choices and not just sweet talk. (applause)

Meanwhile, I will keep a steady hand on the tiller, keeping the ship of state away from the shallows some prefer, and steering it straight on the course we set in 2001.

Ang ating taong bayan ay masipag at maka-Diyos. These qualities are epitomized in someone like Manny Pacquiao. (applause) Manny trained tirelessly, by the book, with iron discipline, with the certain knowledge that he had to fight himself, his weaknesses first, before he could beat his opponent. (applause) That was the way to clinch his victories and his ultimate title: ang pinakadakilang boksingero sa kasaysayan. (applause) Mabuhay ka, Manny! (applause)

However much a President wishes it, a national problem cannot be knocked out with a single punch. A president must work with the problem as much as against it, turn it into a solution if she can.

There isn't a day I do not work at my job or a waking moment when I do not think through a work-related problem. Even my critics cannot begrudge the long hours I put in. Our people deserve a government that works just as hard as they do. (applause)

A President must be on the job 24/7, ready for any contingency, any crisis, anywhere, anytime.

Everything right can be undone by even a single wrong. Every step forward must be taken in the teeth of political pressures and economic constraints that could push you two steps back-if-you flinch and falter. I have not flinched, I have not faltered. Hindi ako umaatras sa hamon. (applause)

And I have never done any of the things that scared my worst critics so much. They are frightened by their own shadows. (applause)

In the face of attempted coups, I issued emergency proclamations just in case. But I was able to resolve these military crises with the ordinary powers of my office. My critics call it dictatorship. I call it determination. (applause) We know it as strong government.

But I never declared martial law, (applause) though they are running scared as if I did. (laughter) In truth, what they are really afraid of is their weakness in the face of this self-imagined threat. (applause)

I say to them: do not tell us what we all know, that democracy can be threatened. Tell us what you will do when it is attacked. (applause)

I know what to do:

As I have shown, I will defend democracy with arms when it is threatened by violence; with firmness when it is weakened by division; with law and order when it is subverted by anarchy; and always, I will try to sustain it by wise policies of economic progress, so that a democracy means not just an empty liberty but a full life for all. (applause)

I have never expressed the desire to extend myself beyond my term. (applause)
Many of those who accuse me of it tried to cling like nails to their posts. (laughter/applause)

I am accused of misgovernance. Many of those who accuse me of it left me the problem of their misgovernance to solve. (applause) And we did it.

I am falsely accused, without proof, of using my position for personal profit. Many who accuse me have lifestyles and spending habits that make them walking proofs of that crime. (applause)

We can read their frustrations. They had the chance to serve this good country and they blew it by serving themselves. (applause)

Those who live in glass houses should cast no stones. Those who should be in jail should not threaten it, especially if they have been there. (applause)

Our administration, with the highest average rate of growth, recording multiple increases in investments, with the largest job creation in history, and which gets a credit upgrade at the height of a world recession, must be doing something right, (applause) even if some of those cocooned in corporate privilege refuse to recognize it. (applause)

Governance however, is not about looking back and getting even. It is about looking forward and giving more -- to the people who gave us the greatest, hardest gift of all: the care of a country. (applause)

From Bonifacio at Balintawak to Cory Aquino at EDSA and up to today, we have struggled to bring power to the people, and this country to the eminence it deserves.

Today the Philippines is weathering well the storm that is raging around the world. It is growing stronger with the challenge. When the weather clears, as it will, there is no telling how much farther forward it can go. Believe-in-it. I believe. (applause)

We can and we must-march-forward-with-hope, optimism and determination.

We must come together, work together and walk together toward the future. (applause)

Bagamat malaking hamon ang nasa ating harapan, nasa kamay natin ang malaking kakayahan. (applause) Halina't pagtulungan nating tiyakin ang karapat-dapat na kinabukasan ng ating Inang Bayan. (applause)

And to the people of our good country, for allowing me to serve as your President, maraming salamat. (applause)

Mabuhay ang Pilipinas! (applause)

Tourism chief: Boracay airport ready by Sept.

By Kristine L. Alave
Philippine Daily Inquirer

MANILA, Philippines—The Caticlan airport, gateway to the internationally renowned resort island of Boracay, will be opened to bigger aircraft in September after the departments of tourism and transportation recently gave the go-ahead to upgrade the runway.

Tourism Secretary Joseph Ace Durano in a statement said the Caticlan International Airport Development Corp. (CIADC), a private consortium, has been granted the 25-year airport upgrade project which starts this month.

The upgrade, prompted by a series of minor plane mishaps this year, will start with the contouring of a bordering hill to lengthen the runway. Durano said this part of the project would be finished by September, just as the tourist traffic starts to get heavy.

"The Civil Aviation Authority of the Philippines, government agencies concerned and the private sector are consolidating all efforts to complete the runway upgrade. We have been assured it will be fully operational in September, the start of Boracay's peak season," Durano said.

The recent accidents, involving planes overshooting the runway, prompted the CAAP earlier this month to prohibit the larger aircrafts of Philippine Airlines, Cebu Pacific and Zest Airways from using the airport. At present, the runway is limited to one-way takeoffs and landings by smaller planes.

With the Caticlan airport—which is only 10 minutes away by ferry from Boracay—closed for rehabilitation, the major airlines are using the Kalibo, Aklan, airport which is two hours away by bus from the resort island.

HK, LA, Rome, Dubai automated polls mulled

By Anna Valmero

MANILA, Philippines — Following a similar recommendation of the Department of Foreign Affairs (DFA), the Commission on Elections is studying the possibility of automating next year’s elections in Hong Kong, Los Angeles, Rome, and Dubai, it was learned Monday.

Initially, the DFA, which conducts the elections overseas, proposed automated elections in eight areas, or in two areas from the four regions of Americas, Asia Pacific, Europe, and Middle East. But the poll body halved the target to one area per region to make the project “more workable,” Comelec executive director Jose Tolentino said in an interview.

Commissioner Nicodemo Ferrer, who supervises overseas voting, confirmed the plan and said his office “is exploring the possibility of automating the OAV elections in at least one or up to four areas as pilot test. At the very least, we are looking to automate OAV polls in Hong Kong.”

“We are still talking with the provider Smartmatic-TIM for this project since the P7.2 billion nationwide automation does not cover absentee voting,” Ferrer said.

The four possible pilot-test areas were chosen based on the high turnout of voter applicants and the ease of implementing it there, according to Glinis Tamondong, officer of the Comelec’s Commission on OAV (COAV).

“Dubai was chosen over Riyadh in Saudi Arabia, which has ‘stricter implementation rules,’” Tamondong said.

As of July 24, she said, Hong Kong has 15,240 OAV registrants, Los Angeles 8,612, Rome 1,563, and Dubai 8,182 applicants.

Tamondong said the DFA and the COAV are still discussing the proposal, particularly the estimated P52-million cost for automating the elections in these four areas.

She explained that the expense is quite high because “under the law, absentee voters are given 30 days to cast their votes. So if we automate this, we will have a 30-day operation starting from April 10, 2010 until the close of polls on May 10, 2010 at 6 p.m.”

Comelec and DFA will meet in August to finalize the proposal, said Tamondong.

For the rest of the overseas absentee voters using the manual system, certificates of canvass will be sent to Comelec main office to be included in the final canvassing. The machines for canvassing and vote consolidation must also read these manually prepared certificates of canvass.

Agriculture, fisheries, forestry pull Northern Mindanao to top as fastest-growing regional economy in the Philippines

Bong D. Fabe
Business Mirror

CAGAYAN DE ORO CITY—The combined robust performance of Region 10’s agriculture, fisheries and forestry sectors pulled Northern Mindanao to the top of the country’s fastest-growing economies in 2008.

Data released by the National Statistical Coordination Board showed that Northern Mindanao posted an economic growth of 5.3 percent in 2008.

This performance was fueled by the 10.7-percent expansion of the region’s agriculture, combined by the 31.2-percent growth in the region’s fishery and forestry sectors.

Closely following Northern Mindanao as the fastest-growing economy in 2008 were the National Capital Region (NCR) with a 4.9-percent growth and Soccsksargen (South Cotabato, Cotabato, Sultan Kudarat, Sarangani, General Santos) in third place with 4.6 percent.

Western Visayas came in fourth with 4.4 percent, and Bicol region, with 4.3 percent, placed fifth.

The Cordillera administrative region (CAR) registered the slowest growth at 1.8 percent in 2008, a deceleration from 7.1 percent in 2007.

Northern Mindanao’s economic performance in 2008 even outpaced the national average of 3.8 percent.

The region also contributed the biggest share with 28.3 percent to Mindanao’s economy, which is an increase of 0.4 percent to its contribution in 2007.

Region 10 also contributed 0.3 percent to the country’s GDP in 2008, along with Central Luzon and Western Visayas.

In terms of real per capita, Northern Mindanao had a real per capita GRDP of P17,050 in 2008. This is higher than the national per capita GRDP of P15,686 in 2008.

Northern Mindanao, with its 108.7 per capita index relative to the national average, placed third following NCR’s 254.6 and CAR’s 121.4.

However, despite topping the list as the country’s fastest growing economy in 2008, Northern Mindanao’s economy actually decelerated by 2.4 percent in 2008 compared with its performance in 2007, during which it posted a high of 7.7 percent.

According to the NSCB, the economies of all the major island groups (Luzon excluding NCR, Visayas and Mindanao) recorded decelerations from 2007 to 2008. Luzon’s economy slowed down from 6.2 percent to 2.7 percent while that of Mindanao decelerated from 7.0 percent to 4.0 percent.

The economy of the Visayas islands group recorded the biggest deceleration, from 7.5 percent to 3.8 percent or by 3.7 percentage points.

More economic nonsense

Outside the Box
John Mangun
Business Mirror

Occasionally in the entertainment/lifestyle section of a newspaper, you will see an article titled something like “Where Are They Now?” Then you read about some celebrity whose star has faded and little is heard about.

The New York Post is famous for its “Weird But True” section with stories like “Michael Jackson is getting a new tribute, a statue of the singer made out of butter will be displayed at the Iowa State Fair next month.” Or “A German drunkard stumbled into an open drain and got stuck in the hole because of his large beer gut.”

There ought to be something similar in the business section to call attention to the “economic nonsense” that we are confronted with on a daily basis.

About a week or so ago, tire manufacturer Goodyear announced that it was closing its factory in Las Piñas, laying off 500 workers. “Google” this story and you will find more than 170 stories from around the globe about this event. Granted that the factory opened in 1956, the closure was clearly a result of the current economic meltdown. The majority of the Las Piñas factory production, 2 million units, was for the export market. And its closure was part of a broader Goodyear downsizing program to reduce world production by 15 million to 20 million tires annually.

However, a comment from Goodyear’s Asia-Pacific region president based in Shanghai provided some fine material for the local Philippine bashers. He said, “Due to high costs compared to other plants in the region, tires produced in the Las Piñas plant are not competitive in the marketplace.”

Some of our loyal local pundits jumped on that statement as further proof that the Philippines has not got a chance to compete in the global markets.

Goodyear, like many other multi-national manufacturing companies, are forced to reduce worldwide production. They chose to close those factories where production costs are higher. It is simple arithmetic. And what is the No. 1 production expense? Labor costs.

So if we want to be more “globally competitive,” the solution is very simple. In fact, the solution is so perfect that with this proposal, Goodyear might not only come back to the Philippines but increase capacity to employ 5,000, not just 500 Filipinos. And I can almost guarantee that by next year, the Philippines would be in the top 10 in the global competitiveness rankings.

We start by abolishing the minimum wage for multinational companies who set up shop in the Philippines. No longer will we allow the Chinese, Vietnamese or anybody else to be more wage-competitive than the Philippines. We outlaw labor unions, collective bargaining agreements and workplace safety rules. In fact, in 20 minutes, the Congress and the Senate can solve most of the competitive issues by repealing the Philippine Labor Code. That way, the Indonesians, Malaysians and the Thais will not have a chance against us.

We can abolish all taxes; income, tariff duties, and payroll for these companies. And we can do away with other competitive issues like SSS, PhilHealth, and Pag-Ibig payments. The multinationals (and some Filipinos) have said for years that the country should be more grateful for all the jobs these companies create, so now the nation can give them a really big “thank you” by these measures. We can show the world what “global competitiveness” really means.

In fact, why go through all that time and trouble? When a foreign company wants to do business in the Philippines, we should just let them write their own rules. Anyway, they often tell us that they know what is best for the Philippines. But in truth, most of the conversation regarding Goodyear/competitiveness is nonsense.

The headline (not BusinessMirror) read: “BIR falls P11.5-billion short of first-semester target.” The analysis was that this “shortfall” was because of “poor economic conditions.” Buried and ignored in that article was the important information that, of course, BusinessMirror correctly headlined; “VAT surged to P86.56B in first half.”

The Bureau of Internal Revenue (BIR) sets collection targets. These are targets and goals, and reaching or not reaching a goal may not have anything to do with the economy. Income-tax collections were down 9 percent from 2008. However, there is not necessarily any correlation between a company paying less tax and earning less profits as the article implies. A company could easily have greater revenue and greater gross profit and still have a smaller tax bill because of a variety of factors unrelated to the economy.

Only BusinessMirror got to the truth. “Tax collected from services and goods subject to 12-percent value-added tax [VAT] surged 24.6 percent in the first half of the year to P86.56 billion, boosting arguments that local output should remain resilient this year and prove the economic doomsayers wrong.”

Notice the number on the valued-added tax collection: higher by 24 percent over 2008. That clearly shows the amazing strength of the Philippine economy during these difficult times. Any other conclusion is absolute economic nonsense.

On a personal note, the exclusive stock-market web site and market update, now reserved for members of the Portfolio Trading Program, is available. If you would like subscription details for the weekly Stockmarket Update and a sample, please e-mail me.

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Monday, 27 July 2009

Pres Gloria Arroyo's SONA 2009

Starting from

Watch SONA 2009 here

GMA in 9th and final SoNA
Will cite achievements, appeal for unity
Manila Bulletin

Facing a troubled economy and waning popularity, President Arroyo will attempt to put a positive glow on her years as president and promise to keep the nation strong and stable as it heads for an election year when she delivers today, Monday, her ninth and final State of the Nation Address (SoNA) at the Batasang Pambansa in Quezon City.

The President is expected to highlight her achievements in keeping a strong economy, building modern infrastructure, and improving education and other social services in the last eight years during her 40-minute annual address before a joint session of Congress.

With less than 12 months in office, Mrs. Arroyo’s speech will also dwell on her legacy of a strong and resilient economy and endorse some plans, particularly the Philippine Education Highway, to the country’s next leader.

An initial draft of the SoNA showed the President will push for reforms to repair the country’s damaged political system while seeking support to ensure next year’s automated elections will be free, fair, and reflect the true will of the people.

Press Secretary Cerge Remonde declined to confirm or deny if the President would tackle proposed amendments in the Constitution in this year’s annual address. He said the President will spotlight the economy and education in her final report to the nation. The big SoNA theme will be the economic gains of the Arroyo administration since 2001 and how it intends to build on these accomplishments in the face of the global financial crisis.

The draft SoNA indicated the President will present the stark reality that economic growth has slowed although the country remains better off than most other nations. Keeping the country from global recession will be hard but she will say she has never stepped back from any challenge.

On the eve of her SoNA on Sunday, the President obtained inputs on the progress and challenges of education in the country for her annual address during a meeting with education officials in Malacañang.

“Nothing is more sacred or more valuable to enhancing the dignity of every Filipino than a good education. No issue is more to us than education. Our children, the children of our nation are our most precious to us,” the President said in her brief remarks to the group.

“We must give them every opportunity to use their God-given talents to lift themselves up. Education is the ticket to better life,” she added.

Mrs. Arroyo said the country cannot have a high quality of life without a good economy, a central principle of her administration. "And the only way for our hard-working citizens to take advantage of a strong economy is through attaining a sound education," she said.

A task force led by Ateneo President Bienvenido Nebres has formulated the Philippine Education Highway, which presents a continuum from early childhood education to grade school to high school and to technical-vocational school or college to ensure a good job and good future for the Filipino youth.

The President is expected to ask next administration to carry on with the Day Care and Pre-School Curriculum for five-year-old children and allocate funds for the rest of early childhood care and development services.

While her government has revised the curriculum to increase math, science, and English, the President is expected to ask her successor to press on making English the medium of instruction starting from the third grade.

On infrastructure development, Remonde said the government invested heavily in building roads, bridges, airports, seaports, and other power, agricultural, and social infrastructure.
“Today, 98 percent of all barangays have electricity. Today, 98 percent of the archipelago has cellular phone signal. Eight out of 10 Filipinos have a cellular phone. There are 70 million cellular phone users out of a population of 92 million,” he said.

Included in the President’s SoNA will be a list of laws she wants Congress to pass on the resumption of its sessions. Among the priority measures are higher taxes on alcohol and tobacco products and other revenue bills, more infrastructure projects, and closing the budget deficit. She is also expected to ask Congress to approve the Marine Code to provide single accountability for the country’s marine interests, to extend the Comprehensive Agrarian Reform Program, to fund the the deployment of more policemen on the streets to increase public safety.

The President will also devote part of her SoNA to plans on improving health care, particularly reducing maternal and infant mortality, as well as stepping up efforts for energy security and environmental protection.

Towards the end of her speech, the President will appeal for national unity, asking both friends and foes to join hands to see the nation through the tough economic times.

Remonde disclosed that among the special guests of the President in the SoNA assembly will be Filipino boxer Manny Pacquiao. The President is expected to cite the victories of Pacquiao and say that they should inspire all Filipinos to have the same discipline, tenacity, and pride to triumph against all odds.

For Monday’s SoNA, the Armed Forces of the Philippines (AFP) has directed its troops deployed for the event to observe maximum tolerance. Ibrado reminded the troops that the Philippine Naional Police is the agency that has the primary responsibility for the SoNA and the rallies.

The troops they will only be employed if there is a need for them. AFP Chief of Staff, Gen. Victor Ibrado, appealed to those who will holding mass actions to “just conduct their rallies peacefully as they say they would to avoid problems.”

The Police Regional Office (PRO) in the Cordillera has dispatched a 300-man police delegation to Metro Manila as its contribution to the augmentation force of the Philippine National Police (PNP) to ensure the prevalence of law and order when President Gloria MacapagalArroyo delivers her SoNA. Chief Supt. Orlando L. Pestano, PRO-COR regional director, said the region’s elite civil disturbance unit will help provide security measures within the Batasan complex and other strategic places in Metro Manila.

Some 1,000 members of the transport group Pagkakaisa ng mga Samahan ng Tsuper at Opereytor Nationwide (Piston) will join Monday’s anti-government protest actions to denounce the alleged failure of the Arroyo government to resolve problems of the public transportation industry such as “kotong” and “colorum” vehicles.

Piston Secretary General George San Mateo stressed that their participation in the protest actions is not meant as a transport strike since only their members barred from plying their routes because of the color-coding scheme will be joining the demonstrations.

San Mateo said drivers continue to fall prey to extortionist traffic law enforcers contrary to the claim of President Arroyo in last year’s SONA that the problem has been eradicated.

Department of Education National Capital Region (DepEd NCR) Director Teresita Domalanta announced Saturday the suspension of all classes in NCR. “In view of the expected heavy traffic on Monday resulting from the coinciding major events of the SoNA and the grand celebration of the INC anniversary, all public and private pre-school, elementary and high school in NCR will be suspended on Monday, July 27,” Domalanata said.

Classes on the tertiary level are not suspended. However, Polytechnic University of the Philippines (PUP) announced Saturday that all branches of the university all over the country are suspended on Monday. (With reports by JC Bello Ruiz, Dexter A. See, Angelo G. Garcia, and Elena L. Aben)