Wednesday, 24 November 2010

"Perfected" Laguna de BAy project deserves respect

‘Perfected’ Laguna de Bay project deserves respect

Wednesday, 24 November 2010 00:00

Manila Times

As you may imagine—but ap-parently Malacañang has not, the announcement made by President Benigno S. Aquino 3rd canceling a Belgian-supported project to rehabilitate Laguna de Bay has upset not a few quarters.

For example, residents and local government officials of lakeshore towns had been looking forward to the implementation of the so-called Laguna Lake Rehabilitation Project (LLRP).

The heavy siltation of Laguna de Bay has greatly diminished its water-holding capacity. The towns around the lake and even Metro Manila face the dire prospect of massive flooding that can exact a heavy toll on lives and property, as shown by our experience with Typhoon Ondoy/Ketsana in September 2009.

The LLRP is contained in a contract worth P18.7 billion entered into by the Philippine government, through the Department of Environment and Natural Resources (DENR), and the Belgian company Baggerwerken Decloedt en Zoon (BDC).

There are indications that the President canceled the LLRP in pique during a recent meeting with Rodrigo Cabrera, head of the so-called Laguna Lake Development Authority (LLDA).

Cabrera had earlier told reporters that the rehab project was “still under review.” Mr. Aquino supposedly did not take too kindly to the LLDA chief’s remarks.

At the meeting last week, the President told Cabrera and other officials—in no uncertain terms—that he has canceled the contract.

Actually, Mr. Aquino had first raised questions about the lake rehab project in his State of the Nation Address. Subsequently, he told a group of newspaper editors the same thing.

Last Friday, Palace spokesman Edwin Lacierda confirmed that the President had indeed terminated the lake rehab project.

The administration has been telling everyone about the President’s decision to scrub the LLRP—except those who deserve to be told the bad news first.

Supporters of the LLRP told newsmen over the weekend that the Philippine government had yet—as of this writing—to give the project contractor, BDC, a formal notice of rescission of contract.

One of them said: “Given the scale of the project, the government should at least have given BDC the courtesy of informing it of the decision to unilaterally cancel the contract.”

Sources said that the Philippine government has not even given the Belgian contractor any update on the status of the project since the contract was signed in 2009. BDC was apparently the last to know about the termination of their contract with DENR.

Proponents of the LLRP continue to point out that the legality of the dredging project has been upheld by three heads of the Department of Justice (doj), including current DOJ Secretary Leila de Lima. They added that the contract has also gone through the entire process of approval—passing muster before the National Economic and Development Authority (NEDA) and the Department of Finance, aside from the DOJ.

The provincial government of Laguna has endorsed the project, as have nongovernmental and people’s organizations in the area because they realize the benefits that dredging the biggest body of freshwater in Luzon would bring.

“The government cannot say that the project is overpriced or graft-ridden because it has met all the legal requirements and no one has come forward with solid evidence that the contract is grossly disadvantageous to the government,” one of the LLRP’s backers emphasized.

Aside from the grave peril that the project’s cancelation exposes lakeshore and eastern Metro Manila communities, the President’s unilateral termination of the LLRP underscores the unstable business environment in the country.

“The business sector wants a predictable business setting where policies and rules and regulations are clearly laid out and implemented evenhandedly across all sectors,” explained one of the project’s supporters who requested anonymity for obvious reasons.

“However, an unpredictable business environment where contracts can be unilaterally cancelled by the government negates its efforts to attract more investments and create jobs that are crucial to reducing poverty in the country,” the source added.

The Aquino administration is trying to encourage so-called public-private partnerships, or PPPs, in its bid to accelerate the country’s economic growth. “But how can the private sector be enticed to put money in business ventures if they cannot be assured of adequate protection for their investments and the rules are selectively applied?” the source asked—rhetorically, of course.

The decision to cancel the LLRP also has international repercussions. “Foreign contractors and foreign investors would now think twice about doing any business with the Philippine government since they cannot expect a level playing field where their investments can be amply protected and valid contracts can be upheld and respected,” the source said.

This issue is also likely to become an irritant in Philippine-Belgian relations. Ambassador Christian Meerschman of Belgium was said to have expressed concern over the erratic business conditions in the Philippines, adding that his country will review existing bilateral ties, including trade and official development assistance (ODA), in view of the LLRP’s cancelation.

“It’s likely that the entire European Union would also take firm steps to protect their business interests in the Philippines in the wake of Mr. Aquino’s ill-advised move to cancel the Laguna de Bay dredging project,” one of the project’s supporters said.

Actually, it is not too late for the President to reconsider his decision to terminate the LLRP. However, he would need to seek the counsel of quarters other than those who have opposed the Laguna de Bay project and others like it from the very start.

Moreover, BDC reserves the right to seek legal remedies so that the project contract can be upheld.

“The Belgian contractor can even elevate the issue to the proper international body for arbitration, as in the case of NAIA 3,” one of the project’s boosters said, referring to the controversy-ridden construction of the third terminal of Ninoy Aquino International Airport.

“After all, the Laguna de Bay contract is a perfected contract, and should be respected by both sides,” the source stressed.

Nestlé starts construction of P4-b plant in Batangas

Julito G. Rada
Manila Standard

President Benigno Aquino III led the groundbreaking ceremony Tuesday for Nestlé Philippines’ planned P4.3-billion factory in Tanauan, Batangas.

Nestlé SA will add two “major” plants to its facilities in the next 10 years, Nestlé Philippines chairman John Miller said at the event.

2010 has been a “good year, with sales likely reach P95 billion, Miller said.

The factory, which is expected to be completed in March 2012, is situated on a 27-hectare site and will produce non-dairy creamer and powdered milk products.

Miller said the facility would increase the production of the two products. He said he expected the domestic market demand for Bear Brand and Coffee-Mate products to grow by 19 percent and 8 percent, respectively.

Nestlé will celebrate 100 years of operations in the Philippines next year.

The new Tanauan factory will initially create 170 jobs.

Miller earlier said the expanded output would reduce Nestle’s imports from Thailand.

Nestlé also plans to invest more in its four facilities in Cagayan de Oro City; Cabuyao, Laguna; Lipa, Batangas; and Pulilan, Bulacan.

Nestlé’s local investments in the past five years have reached close to P10 billion, with about 80 percent allocated for existing facilities to generate higher efficiencies. It earmarked the balance to sales infrastructure, distribution and IT systems.

Pangilinan plans $300-M MRT-3 upgrade

Manila Bulletin

MANILA, Philippines – Manuel V. Pangilinan-led companies are on investment binge including a planned $300 million to $700 million for the refurbishment of Metro Rail Transit (MRT)-3, a P28 billion capital expenditures (capex) of PLDT next year and more investments in the energy sector, including electric vehicles.

This was revealed by businessman Manny V. Pangilinan to reporters Tuesday at The 1st Philippine Electric Vehicle Summit in Meralco Multipurpose Hall in Pasig City.

According to Pangilinan, the planned investments in MRT 3 would be used for the capacity expansion of the EDSA Line. This includes the refurbishment of the line, new rolling stocks and signaling systems.

Earlier, Pangilinan said that Metro Pacific Investments Corp. (MPIC) was eyeing an additional stake in the Metro Rail Transit (MRT)-3 project, on top of the 29 percent it is set to acquire from Sobrepeña-led Fil-Estate Corp.

The planned additional stake in MRT-3, however, is still subject to the consent of its shareholders.

MPIC, which is chaired by Pangilinan, has entered into an agreement to acquire Fil-Estate’s stake in four Metro Rail Transit (MRT)-3 companies. The four companies are Metro Rail Transit Holdings Inc., Metro Rail Transit II Inc., Metro Rail Transit Corp. (MRTC) and Monumento Rail Transit Corp.

Fil-Estate’s key investment is in the form of equity interest in Metro Rail Transit Holdings Inc. and Metro Rail Transit Holdings II. Its combined investment in these holding companies represented approximately 29 percent interest in the MRT-3 which runs along EDSA.

MPIC has also expressed interest in undertaking the operation and management (O&M) of MRT-3 as well as that of the Light Rail Transit (LRT)-1 which the government plans to privatize under the public-private partnership (PPP) program.

Pangilinan, who also chairs PLDT, said that capital expenditures for the country’s biggest telecommunications firm next year would be pegged at P28 billion, which is of the same level as the 2009 capex. (BCM)

Tuesday, 23 November 2010

10-month investments rose 200% to P237b

by Julito G. Rada
Manila Standard

The Board of Investments approved P237 billion worth of investment pledges in the first 10 months of the year, up 194.7 percent from P80.4 billion year-on-year, on the back of growing investor confidence in the Philippine economy.

The 10-month figure is just P50 billion short of the agency’s full-year target of P287-billion target.

Lucita Reyes, BoI executive director, earlier said she was confident the agency would slightly overshoot its target this year by almost 4.52 percent to P300 billion, citing several pending projects for approval by the board.

She said she expected more approvals for the rest of the year as investors normally try to catch up before the year ends.

A BoI source earlier said over 200 projects were awaiting for board approvals, an unusual number compared with those in the previous months.

The source said the higher number of projects indicated that investors, especially those from abroad, remained confident in the country’s business climate.

The source said the projects were mostly in manufacturing, electronics and other industries like energy, shipping, garments expansion and housing.

One of the latest big investments in housing was the P1.05-billion Wind Residences Towers 1 and 2 in Tagaytay City by SM Development Corp., the property arm of the SM Group of retail tycoon Henry Sy.

The project involves the development of 22,597 square meters of land and the construction of two 20-story condominium buildings. It will generate 576 jobs when construction starts next month.

SMDC has also recently sought incentives for its P3.11-billion Sun Residences Tower 1 and 2 at the corner of España and Mayon St., Quezon City. The firm has three mass housing projects in Quezon City, Sta. Mesa and San Dionisio, Parañaque.

The government has projected overall investments target in 2010 to hit P345 billion, including those generated by the BoI, Philippine Economic Zone Authority, Clark Special Economic Zone and Subic Bay Metropolitan Authority.

BoI and Peza contribute about 90 to 95 percent of the country’s overall investments inflow.

The Philippines registered an all-time high investment figure of P464.2 billion in 2008. Pledged investments, however, declined in 2009 to P314 billion following the global financial crisis.

Banks: The heroes of the economy

Business Mirror

ONE newspaper headline over the past weekend is symbolic about the Philippines situation in the midst of the global financial crisis. Philippines President Aquino has intervened in the tourism campaign logo controversy.

I am sure that the leaders of Ireland, Portugal, Spain, and many others would like to trade places and trade problems with our president. These other leaders are trying to keep their respective economies from imploding; the Philippines’ national leader is trying to keep the government’s tourism campaign from imploding.

The year 2010 has been very favorable to the country. The Philippine Stock Exchange is actually the best performing market in the world this year, being beaten by only Sri Lanka, Bangladesh, Estonia and Lithuania.

For all the talk of the peso appreciation, remittances are rising substantially, exports are rising, the outsourcing business is growing, and “hot” foreign money inflow is growing as well as foreign direct investment.

Economic growth for 2010 will put the Philippines at least in the top 10 of global economic activity.

There has not been much conversation in the local press and media about why the Philippines is actually prospering during these difficult times.

The conventional wisdom especially from the “know-nothings” in the international financial community (and some of their local followers) is that the stock market in particular only started rising due to the Aquino election. That is totally false. Stock prices went up more between 2008 and 2010 than they have since the election. Please note that part of the reason for this nonsense from the foreign money “experts” is that they missed the largest chuck of the rally, coming into the PSE only after the election.

It is not remittances that have “saved” the Philippines, nor is it outsourcing, exports, or any other specific monetary factor. These have all contributed to the health and well-being of the economy. But it is because the Philippines financial system is stable and sound that the economy has benefited from all of the above; not the other way around. If the basic system had great problems, all the remittance and all the outsourcing would have had little effect.

To use a silly analogy, all the vitamins in the world will not keep you healthy if you smoke excessively, drink too much alcohol, eat the wrong foods, and sit on the couch watching TV all day. The economic system must be healthy in order for the good financial things to work properly.

In my humble opinion, the true heroes of the Philippine economy are the local banks. Yes, those tight-fisted, unmerciful, uncaring and profit-is-everything-oriented banks.

Local banks have kept their own house in order and therefore contributed to the Philippines keeping its national financial house clean and tidy. I know that it does not seem that way some times, but look at the record.

Philippine banks could have easily taken their own investment money and been part of the crisis of the subprime-loan disaster. Virtually none did. The investment losses of the largest and most omnipresent financial institutions on the planet started the global financial meltdown. Banks were not satisfied making money by loaning depositors funds; they expanded into areas of “investment” that are so far from investing that it would embarrass even a local jueteng lord. Children betting on spider fights have more investment sense than the global banks did.

I can just imagine one of the international investment firms trying to sell credit-default swap derivatives or collateralized debt obligations to a local back 10 years ago. The local banker probably ended the conversation with something like this: “We prefer to lend money to Henry Sy. He builds malls, he makes money, he pays back his loan. No thanks.”

The local banks kept to the simple and profitable business model of borrowing from depositors and lending to financially secure individuals and businesses.

Banks in the West created the property bubble that has collapsed economies. Not here in the Philippines. Philippine banks required old- fashioned money on the table, not a piece of paper with a signature, to buy real estate. Yes, this policy slowed economic growth over the years but it kept the system stable and financially sound. Houses and condominiums were built for people who could afford to buy them, not for people who were speculating on a price bubble. That prevented any housing bubble and stopped unrealistic price appreciation. We have the banks to thank for a vibrant and secure property market.

Personal debt was kept in control by bank practices. In the USA, banks used to send out credit cards the way you get spam e-mail. Sign, return the form and you can have a brand-new credit line. All those sign-up fees and annual charges that the banks charge for credit cards in the Philippines are designed, not only to protect them from losses, but work to protect you from taking additional credit that you cannot afford. “Free” credit is never free. It must be paid for eventually. Except that if enough people do not or cannot pay, the economic system suffers a credit collapse as has happened in the West.

There is nothing better for an economy (like in the Philippines) than to see a consumer pull out a handful of cash to buy that new wide-screen television or car. That person’s wealth creation through a job or a business now creates more wealth through their purchases. And all of it is real; not based on a debt/credit illusion.

Philippine banks have played a vital role and have been a very successful component in keeping the Philippine economy secure. We are now able to reap the benefits of decades of prudent financial management by the banking sector.

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Religious Pacquiao is for abstinence

Lira Dalangin-Fernandez

MANILA, Philippines—Showing his religious side, Sarangani Representative and boxing champion Manny Pacquiao on Monday said he is opposed to the reproductive health bills and instead pushed for abstinence as a means of curbing population growth.

In a news conference in the House of Representatives, Pacquiao said the Bible did not state that families should limit the number of children they can have. Instead, it tells the people to “go to the world and multiply,” he said.

“Walang nakasulat sa Bible na limitahan natin iyong magiging anak natin. Unang una, sabi ng Panginoon, go to the world and multiply, hindi nya sinabi na multiply with just two or three kids, multiply, magpakarami kayo (There isn’t anything written in the Bible that says we should limit the number of children we can have. First of all, God said go to the world and multiply, he didn’t say multiply with just two or three kids, he said to multiply),” he said.

A devout Roman Catholic, Pacquiao said he is opposed to the use of condoms and advised couples to instead follow the natural family-planning method and practice abstinence when it is not safe to have sex.

“”Kailangan magtiis tayo, ‘darling ‘wag muna tayo ngayon ha kasi fertile ka ngayon, magtiis ka muna,’ dapat may pagtitiis tayo (We have to sacrifice, ‘Darling we can’t do it today because you are fertile, so we have to sacrifice’),” he said.

But he said it isn’t always men who should practice abstinence, but women as well who, he said, sometimes initiate the sexual act.

“Magsakripisyo naman kayong mga lalaki, tiisin nyo, ay, iyong mga babae din pala, minsan yung mga babae pa nangangalabit,” he added.

Speaker Feliciano Belmonte Jr. has once more made the assurance that the reproductive health bill would be voted on in plenary.

There are at least seven bills on reproductive health pending with the committee on population. The hearings will begin this week.

Pacman:the Lord said: ‘Go to the world and multiply’ and not ‘go to the world and have two kids’

Paolo Romero

MANILA, Philippines - Pro-life advocates might have found a new poster boy in world boxing champion and Sarangani Rep. Manny Pacquiao, who expressed opposition to the controversial Reproductive Health (RH) bill and suggested abstinence as a means of family planning.

“I’m against the RH Bill because I have many siblings,” Pacquiao said yesterday in a press conference at the House of Representatives in Quezon City when asked about his stance on the controversial population control measure. “And also on condoms, I’m not in favor of it.”

Seated beside Pacquiao during the press briefing was Speaker Feliciano Belmonte Jr., who earlier reiterated his commitment to have the bill reach voting in the plenary.

Pacquiao has two sisters and four brothers and has four children – Emmanuel Jr., Michael, Princess, and Queen Elizabeth.

“We have our own respective beliefs. We have differing beliefs. I believe that there is nothing in the Bible that says that we limit the number of our children,” Pacquiao said.

“In the first place, the Lord said: ‘Go to the world and multiply’ and not ‘go to the world and have two kids’,” he said.

He said couples should undergo orientation on how to plan a family that could entail abstinence to limit the number of children.

“We sometimes need to make sacrifices like: ‘Darling, not tonight because you’re fertile so we sacrifice in the meantime’,” Pacquiao said, eliciting laughter from journalists.

“You guys must also learn to sacrifice, abstain. But hey, the girls sometimes are the ones making advances,” he said.

He said he supports the bill filed by Parañaque Rep. Roilo Golez and co-authored by former president and now Pampanga Rep. Gloria Macapagal-Arroyo seeking to protect the rights of the unborn child.

Pacquiao reported for work at the House of Representatives for the first time after arriving in the country last Saturday from Texas after defeating Mexican fighter Antonio Margarito.

“I want to be a champion public servant,” he said prior to being conferred the Congressional Medal of Distinction by Speaker Belmonte at the session hall in the afternoon.

“I’m taking a break from boxing and I’ll focus now on my job as a congressman,” he said in Filipino.

After the briefing, he proceeded to the session hall where he was given a red carpet welcome with cheering House employees lining the path and waving the Philippine flag.

“We honor our colleague today, not only what he has achieved but for what his victories signify for our country… He has showed us that he is a man of strong faith, which has carried him through every adversity, and he has never ceased to return that gratitude to our God despite the many peaks he has already achieved in his life,” Belmonte said.

He said Pacquiao has reminded “us of our role to utilize our skills as leaders of government and inspire and instill basic values in our people, especially the youth who will inherit this nation and become our future leaders.”

“His achievements prove that with determination, discipline and focus, greatness is within reach of anybody who perseveres through hard work, an accomplishment that should inspire and be emulated by the youth of the Philippines and around the world,” the congressional citation stated.

“This victory is not mine alone, it belongs to the Filipino people,” Pacquiao said in accepting the honor. “We have shown how we the Filipino people can excel in a world-class arena because of hard work, dedication and faith in the Almighty.”

Session was suspended at 4:30 p.m. after the conferment ceremonies. Lawmakers later feted Pacquiao with a victory dinner that included a live band at the foyer of the Speaker’s entrance of the main building of the Batasang Pambansa complex.

Earlier in the day, Pacquiao went over a long list of projects and requests from his constituents that urgently needed to be implemented but were delayed due to lack of funds.

“I have many things to take care of. I’m overwhelmed I am back, there are many things to attend to here,” Pacquiao told reporters while seated at his desk in his office wearing a suit with a red striped tie.

He said among the requests flooding his office were for additional classrooms, a mini-gym, various livelihood programs, and the repair of the provincial hospital and municipal hall in Sarangani.

“I have to prioritize the classrooms and the livelihood programs,” he said.

He said he thought of a novel idea to help more of his constituents despite limited government funds at his disposal by entering into an exchange deal with the Philippine Charity Sweepstakes Office (PCSO), which plans to tap him as one of its endorsers.

He said instead of getting his talent fee, he would ask the PCSO to convert the amount into ambulances that he can distribute to each of municipality of the province.

“I won’t get my payment anymore (from PCSO),” Pacquiao said. “I always want to help my country and my fellow Filipinos.”

“I’m happy for the blessing that I receive from God, like my earnings from boxing. I wish I would be of great service and help to others,” he said.

As an endorser, Pacquiao is likely to earn millions.

He said he is willing to take additional tasks in the name of public service as his current duties and schedules permit.