Saturday, 23 April 2011

Manila's BOP surplus surges 10-fold in March

Lailany P Gomez
Manila Times

THE country’s balance of payments (BOP) surplus surged by more than tenfold in March amid strong inflows from the central bank’s investments and money sent home by Filipinos working abroad.

Data from the Bangko Sentral ng Pilipinas showed that the country’s BOP registered a surplus of $2.020 billion in March or 1,095 percent higher than the $169 million in the same month in 2010.
Year-to-date, the BOP registered a surplus of $3.493 billion, or 173 percent higher than the $1.276 billion in the same three-month period last year.

The central bank attributed this development to the continued shift of capital flows into emerging markets such as the Philippines amid a favorable economic outlook.

The robust external payments position for the first quarter was also a result of the proceeds from the national government’s $1.5-billion bond sale during the month and official development assistance loans from multilateral lenders. The country’s BOP position was projected to register a surplus of $6.7 billion this year and $4.5 billion in 2012 amid expectations of a higher trade deficit.

Exports are projected to grow by 9 percent to 10 percent this year and by 12 percent in 2012, while imports are forecast to increase 17 percent to 18 percent in 2011 and 18 percent in 2012.
The other forms of investments under the BOP are loans and holdings of currency and deposits.
The country’s gross international reserves (GIR) level is projected to reach $70 billion this year and expand to $75 billion in 2012.

The country’s GIR jumped by 45.55 percent to $66.2 billion at end-March from $45.599 billion in the same three-month period in 2010.

The BSP holds international reserves for the foreign exchange requirements of the country in case the domestic commercial banks’ supply of the greenback falls short of demand.
The foreign assets that the BSP holds are mostly in the form of investments in foreign-issued securities, monetary gold and foreign exchange. An ample GIR level helps prop up the peso and keeps domestic inflation at bay.

Thursday, 21 April 2011

Celebrate the Living, But Mourn the Dead

By Colin Mason and Steven Mosher 2011 (v13)
Population Research Institute

The media is abuzz with news about humanity's numbers. Sometime during the latter part of this year or early next year—the exact date is still a little fuzzy—there will be, for the first time in history, 7 billion people alive on the planet at the same time.

Left-wing pundits are already splashing ink all over this subject. National Geographic is taking the entire year to decry this increase in numbers, spinning off countless articles, sleek videos, and photo sets warning of the “overpopulation” disasters that supposedly await us.

Other organizations are in full panic mode as well. Panelists at an American Association for the Advancement of Science meeting, abandoning scientific objectivity in favor of junk science, railed about the exponential growth of population and its effect on the environment. Within hours of this meeting, the Internet was ablaze with scary headlines. Yahoo News warned us that the “Planet Could Be 'Unrecognizable' by 2050.” The Teheran Times cried out “Can Humanity Survive a Population of Over 10 Billion People?” (That Iran, thanks to a nationwide sterilization campaign organized by the ayatollahs, is now having too few children to maintain the current population seems to have escaped the paper's notice.)

At PRI we have a different take on Baby Seven Billion. While the world's population doubled and then doubled again in the past century, more people has meant more prosperity. Human beings are currently wealthier, healthier, and better educated than ever before. The percentage of people trapped in poverty continues to decline.

In fact, what we worry about is not a future of too many children, but too few. Human birthrates across all continents are collapsing. Not only will our numbers never double again, we are unlikely to even make it much past 8 billion or so.

Were it not for abortion, of course, we would already be at 8 billion. Worse than any primitive tribe, we moderns have developed a bad habit of killing our offspring, and doing so at an alarming rate. According to Alan Guttmacher Institute's latest report, there are 42 million induced abortions a year worldwide.

The 2011 report of the Planned Parenthood think tank also states that the number of abortions was even higher in the recent past: “The number of induced abortions declined worldwide between 1995 and 2003, from nearly 46 million to approximately 42 million. About one in five pregnancies worldwide end in abortion.”

We really don't know how much credence to give these numbers. After all, Guttmacher has no way of getting accurate statistics from many countries with high abortion rates. The Chinese government alone probably performs 10 to 14 million abortions a year on its women. The real global total could be higher than 42 million.

But let's assume that Guttmacher is roughly correct and do some simple calculations. At 40 million abortions a year, it would only take 25 years to eliminate one billion babies.

Since the abortion business really took off around 1960 or so, we have probably eliminated nearly twice that number, or two billion unborn human beings.

Think about it. Over the past half-century, quietly and without fanfare, in ordinary towns and cities, in dozens of countries around the world, perhaps two billion children have been killed. They have died unknown, often unmourned, and acknowledged only from time to time.

The 20th century was violent by any measure. Thirty-seven million people were killed in World War I. Over 60 million perished in World War II. Six million Jews and another six million Catholics died in Hitler's death camps. Twenty million died at the hands of the Soviet authorities. Sixty-five million Chinese were killed by the Communist Party, while forty-two million more starved to death during Mao's Great Leap Forward. And so on.

But these numbers are dwarfed by the sheer volume of children who have been killed this past half-century.

At the very least, this number of abortions is a demographic event of gigantic proportions. As the human race celebrates its 7 billionth member this fall, we should take a moment to remember the billion or two who fell—and are still falling—victim to the abortionists' knives.

May they rest in peace.

Tuesday, 19 April 2011

DoTC clears GMA project

Manila Bulletin

MANILA, Philippines – The proposed state-of-the-art modular roll-on, roll-off (RORO) ports that the past administration initiated through the assistance of the French government is not overpriced as claimed by critics of the project.

This was revealed by the Department of Transportation and Communications (DoTC) as it readied a report of its findings to the House of Representatives which has set a congressional inquiry into allegations that the project could be disadvantageous to the government.

Undersecretary Ruben Reinoso, who is in charge of the DoTC’s planning and projects, revealed that based on a committee report prepared by two of its attached agencies, the modular RORO ports that would further bolster the country’s already improving local shipping transport industry was “not overpriced”, adding that the cost is reasonable if compared to other proposals of similar components.

A copy of the report prepared by a joint committee composed of the Philippine Ports Authority (PPA) and Maritime Industry Authority (MARINA) will be sent to the House of Representatives, which has been asked to look into news reports that the project is “grossly overpriced.”

Eastern Samar Rep. Ben Evardone sought the congressional inquiry based on the claims of newspaper articles. The House Committee on Transportation has been tasked to conduct the inquiry.

Reinoso said the issue that should be looked into is the site selection. The issue on the reasonableness of the price may not be questioned unless the cost of the project is compared to projects that are similar in components and specifications.

He pointed out that the French modular RORO port project cannot be evaluated as overpriced without comparing the cost of all the components of building a RORO port, as well as the lifespan, operation and maintenance of the project.

The DoTC official stressed that the French modular model will use movable ramps. It includes the building of a terminal and has a guaranteed lifespan of 80 years, which is almost double the 30-to-40-year lifespan of traditional RORO ports made by the PPA.

“We haven’t come up with the site selection. We first have to establish that the price is reasonable and the reasonability of the cost will be done by comparing apples to apples, not apples to oranges,” Reinoso said.

The project, a component of the Strong Republic Nautical Highway program of the Arroyo government, originally proposed the establishment of 100 ports nationwide, but it was cut down to 72 ports because the donor agency cannot fund it all.

Earlier, Eiffel, a firm owned by the French government and Matiere SAS, said they were surprised by news reports alleging that the French modular port is overpriced. They said the report contained sweeping conclusions about the project being overpriced yet no bases were presented to support this claim.

Dr. Patrick Azanza, senior adviser to the French consortium, said the DoTC study showed that the contents of the news reports were disowned by Philippine officials in a letter addressed to the resident manager of the French project consortium.

He said the modular RORO ports project was analyzed and evaluated based on the unbundled unit costs of the project compared with the standard reinforced concrete RORO port on steel pipe piles (SPP) and the Spanish modular RORO ports project previously offered to the Philippine government, which did not materialize.

The financing terms and conditions of the French government COFACE loan for the RORO project were likewise considered, he said.

Azanza said the French Modular RORO Port technology had been proven to offer the least cost to the government with a present value (PV) of P148,452,847 rate per one unit of RORO port.

This claim can be gleaned on the basis of the computed acquisition and follow-on costs derived for each of the RORO technology, and using the life cycle cost method of analysis to determine the most cost effective and economical model.

Unlike the French model, the RC Concrete Port with SPP generated a computed PV of P152,966,320 while the Spanish Modular RoRo port generated the highest PV at P195,322,133. All PVs reflect a discount at 15 percent interest.

Azanza said the financing package should also be compared pointing out that the French port was derived based on the cash outflows under the terms and conditions of the French government COFACE loan provided for the project.

The locally funded cost items such as project administration and the taxes and duties (12 percent value-added tax and three percent import duties) which have been distributed over the three-year project implementation period were likewise included in the evaluation.

With financing, as indicated in the results of the study, the French Modular RORO Port is considered more cost effective and advantageous to the Philippine government.

LRT-MRT loop completion should be fast-tracked

Business Mirror

What’s delaying the completion of the Light Rail Transit (LRT) Line 1 North Extension Project?

The project involves the construction of a 5.7-km elevated line from the Monumento station of Line 1 to the North Avenue station of Line 3, with three new stations, namely, Balintawak, Roosevelt and a common station. An additional station—Malvar in Caloocan City—shall also be constructed.

The original project cost was P6.3 billion, but the revised project cost will go up to P9.6 billion, which includes the cost of construction of a common station, the proposed Malvar station, and an additional unit of rolling stock.

Commercial operation of the Balintawak station started in March last year while the Roosevelt station was put on stream in the last quarter of 2010. But the construction of a common station in front of SM Annex for LRT Line 1 Extension, Metro Rail Transit (MRT) 3 and the proposed MRT 7 has not started. This was supposed to have commenced in the first quarter of this year and completed by the first quarter of 2012, but it’s already April and there’s no visible sign of any construction activity in the area. Thus, the targeted closing of the loop by early next year may not happen.

Closing the loop as soon as possible should be a priority of the Department of Transportation and Communications considering that this would substantially benefit commuters as traffic along Edsa remains chaotic, especially during rush hours.

For instance, very long lines form at the southbound portion of MRT 3 North Triangle station every morning. Of late, both the LRT and MRT lines have also experienced service interruptions. These underscore the need for the government to expand existing facilities and ensure better maintenance.

The Fourth Turning of the Philippines

Business Mirror

We are surrounded by cycles: the weather seasons, business booms and busts, and our own aging. The Christian calendar for most of us begins with the Nativity story in December and ends a few months later with the Easter and Resurrection story. It illustrates the cycle of life.

Historians William Strauss and Neil Howe have written several interesting books about their concept of generational cycles including, in 1997, The Fourth Turning. Boiled down, it is a theory of approximately 80-year economic and social cycles (roughly an average life span) influenced by the growth and maturity of four approximately 20-year age-group cycles.

The Four Turnings are the High, when institutions are strong and society is confident about where it wants to go collectively; the Awakening, when institutions are attacked people are weary of social discipline; the Unraveling, institutions are weak and distrusted, while individualism is strong and flourishing; and the Crisis, as an era when institutional life is destroyed and rebuilt in response to a perceived threat to the nation’s survival.

Within the Four Turnings are the people of different age groups that live through these periods. From Fourth “The young, the prophets, are born in a High, enter young adulthood in an Awakening, midlife in an Unraveling and elderhood in a Crisis. The Nomad archetype is born in an Awakening, enters young adulthood in an Unraveling, midlife in a Crisis, and elderhood in a High. The hero archetype is born in an Unraveling, enters young adulthood in a Crisis, midlife in a High, and elderhood in an Awakening. The artist archetype is born in a Crisis, enters young adulthood in a High, midlife in an Awakening, and elderhood in an Unraveling.”

For those of us who are the baby-boomers, we were born during the First Turning; the High. Not all countries experience the different types of turning cycles at the same time. However, the US and the Philippines somewhat correlate as the end of World War II marked an American optimism that corresponded to the hopefulness of the Philippines’ final independence.

And we who are able to stand in the senior-citizen checkout line at Shopwise, born during the High, have lived through an Awakening and an Unraveling. Perhaps, now we are entering a period of Crisis.

If the Philippines were to follow the Four Turnings, then this is what the timeline might look like: The High 1946-66, the Awakening 1966-86, the Unraveling 1986-2006, and now the Crisis, the Fourth Turning.

In a sense, there may be some slight truth to this. The 1996-86 period saw the founding of the Communist Party of the Philippines, martial law, an almost cult-like worship of President Marcos from some quarters, ending in the student revolts and, of course, Edsa 1. This was the Awakening of, as the authors write, “Youth-fired attacks break out against the established institutional order. As these attacks take their toll, society has difficulty coalescing around common goals. People stop believing that social progress requires social discipline.”

The Third Turning, the Unraveling, is not quite what you might think. There is a feeling that the individual now has the power that once people thought rested with the government. While the Awakening resulted in a push back against government institutions, now the people look to those same institutions and find them weak and ineffectual. “Public trust ebbs amid a fragmenting culture, harsh debates over values, and weakening civic habits.” While we complain bitterly about corruption, we also hear the same people saying that they will not pay the proper amount of taxes because the government wastes the money. On the one hand, the people talk about civic morality and duty and, on the other, ignore the rule of law in their own behavior. Further, there is a constant pessimism about the future.

If the Philippines is in the Fourth Turning, the Crisis, here is what it should be. “Crisis arises in response to sudden threats that previously would have been ignored or deferred, but which are now perceived as dire. Great worldly perils boil off the clutter and complexity of life, leaving behind one simple imperative: The society must prevail. This requires a solid public consensus, aggressive institutions and personal sacrifice.”

From that description, the Philippines has not entered the Crisis period but is still in the Unraveling stage. My own opinion is that the Philippines is a few years from the Fourth Turning.

Consider the issues of corruption and the economy. Coming from the Awakening to the Unraveling, Filipinos went to Edsa in 1986 for economic freedom and against corruption. Edsa Dos saw much less enthusiasm, regardless of the outcome. Where were the massive street protests in 2004 because of the “Hello, Garci” controversy? And while President Aquino campaigned on an anticorruption platform, the public seems for the most part only slightly interested in his efforts.

The Fourth Turning, the Crisis, is characterized by “a sense of public urgency that contributes to a clampdown on ‘bad’ conduct or ‘antisocial’ lifestyles. People begin feeling shameful about what they earlier did to absolve guilt.” Maybe, like suddenly making the “personal sacrifice” of paying correct taxes. Further, “Public order tightens and crime and substance abuse decline. Families strengthen, gender distinctions widen, and child-rearing reaches a smothering degree of protection and structure.”

Remember, the Crisis is triggered; it does not just happen. The last American Crisis (before now perhaps) was triggered by the Great Depression.

The trigger for the Crisis brings people together again in a communal effort to create solutions. The government picks up the message either the “easy way” or the “hard way” and eventually leads for the good of the country. People put aside differences and cooperate, working together for a common goal.

From the Crisis comes the High, a period marked by “a desire for investment, growth and strength—which, in turn, produces an era of commercial prosperity, institutional solidarity and political stability.”

The world is a very dangerous place right now both geopolitically and economically. The trigger for the Philippine Crisis period could come at any time in the relatively near future; $250 for crude oil, major war in the Middle East, hyperinflation in the US and a worthless dollar.

E-mail comments to PSE stock-market information and technical analysis tools provided by Inc.

Monday, 18 April 2011

Why gas prices are rising

BM EXCLUSIVE: 44 firms bidding for LRT 1-MRT 3

Business Mirror

MANUEL V. PANGILINAN said last week his group is open to the possibility of partnering with other bidders vying for the operation and management contracts to operate two railway systems in Metro Manila.

Pangilinan’s Metro Pacific Investments Corp. (MPIC), the local flagship of Hong Kong’s First Pacific, said this when asked how his group was taking the news that a total of 44 local and foreign firms have formally expressed their intention to bid for the contracts of Light Rail Transit 1 and Metro Rail Transit (MRT) 3.

“You mean forming a partnership with the bidders? Yes, we are open to that. It’s quite good that many are going to bid for it,” he said in an interview last week.

Even before the government had issued an invitation for interested firms to submit a written expression of interest, MPIC, in a letter on January 17 to the Transportation and Finance departments, proposed to modernize the MRT 3 by infusing $300 million to double the train system’s capacity.

Separately, MPIC wants to gain control of the railway which services the high-traffic Edsa highway by buying out the government’s interest in MRT 3 for $1.1 billion.

But the Department of Transportation and Communications (DOTC) wants projects to be auctioned off for transparency reasons to avoid a repeat of the Ninoy Aquino International Airport 3-Philippine International Air Terminals Co. Inc. fiasco.

Besides MPIC, there were 43 other firms that submitted written expression of interest before the DOTC’s Special Bids and Awards Committee.

The other big firms, most of which are infrastructure developers, include Ayala Corp.; Optimal Infrastructure, which is 99.9-percent owned by San Miguel Holdings Corp.; First Balfour Inc., a fully owned subsidiary of First Philippine Holdings Corp. of the Lopez group; Miescorrail, a subsidiary of Meralco Industrial Engineering Services Corp.; DM Consunji Inc.; Siemens; Sumitomo Corp.; Bombardier Transportation Sweden AB; Mitsubishi Corp.; Marubeni Corp.; Beijing’s Veolia Transport; Spain’s Construcciones Y Auxiliar de Ferrocarilles SA; England’s Serco Group PLC; Italy’s Finmeccanica S.p.A.; Strategic Industries Alcatel-Lucent; Autre Porte Technique Global Inc.; Abratique& Assoc. Phil. Inc.; Strategic Alliance Holdings Inc.; Federal Management & Maintenance, Inc.; Gracia Y Caridad Ministry Foundation; and PMP Inc.