added to its biggest monthly gain since 2008, while China’s yuan fell for a seventh day. New Zealand’s dollar was set for the biggest two-

day loss in almost four months, as weak data boosted the case for an interest-rate cut.

Conclusion

SAUDI Arabia last week reaffirmed its position not to cut oil production. In an

Agence France Presse report, Saudi Oil Minister Ali Al-Naimi said at an energy conference in Texas on February 23 that his country preferred freezing, rather than reducing, output.

S “A ,” A S “U,” A

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PESO EXCHANGE RATES n US 47.5600 n JAPAN 0.4174 n UK 65.9277 n HK 6.1195 n CHINA 7.2707 n SINGAPORE 33.7472 n AUSTRALIA 33.9157 n EU 51.9308 n SAUDI ARABIA 12.6830 Source: BSP (29 February 2016 )

A broader look at today’s businessBusinessMirror

www.businessmirror.com.ph n Tuesday, March 1, 2016 Vol. 11 No. 145 P. | | 7 DAYS A WEEK

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ASI A N stocks fel l w ith US and European equity futures, while the yen

strengthened after Group of 20 (G-20) finance chiefs made only vag ue commitments to spur growth at a Shanghai meeting. The Shanghai Composite Index sank toward its lowest since No-vember 2014, as shares dropped in Hong Kong and Japan. The yen

Trade-facilitation pact seencutting traders’ cost by 30%

Asian stocks, US futures fall as G-20 meeting disappoints

Unescap to PHL: Implementmigration policies properly

DON’T PUSH THE PANIC BUTTON, YET

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Manny B. Villar

The Entrepreneur

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B C N. P

MANILA’S acceptance of the World Trade Organization’s (WTO) trade-facilitation

agreement (TFA) would result in a cost reduction of 25 percent to 30 percent for local traders, the Department of Trade and Industry (DTI) said on Monday.

With little hope for major policy changes, global economic growth

will continue to struggle.”—A SE

GREAT TASTE Top brands from the United Kingdom were featured at the Great British Festival 2016, held at Bonifacio High Street in Bonifacio Global City, which was attended by (from left) Kevin Brennan, CEO of Qourn; Henry Soesanto, CEO of Monde Nissin; Sen. Loren Legarda; and British Ambassador to the Philippines Asif Ahmad. The event celebrates the close ties between the UK and the Philippines. NONIE REYES

IN AN UPSET, ‘SPOTLIGHT’ WINS BEST PICTURE AT OSCAR »D3

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$22TEstimated value of world merchandise trade

Trade Secretary Adrian S. Cris-tobal Jr. said traders would incur cost savings due to the reduction of red tape and nontariff barriers, which tend to inflate trade costs.

C r i stoba l sa id t hese cost

savings would trickle down to consumers and result in cheaper consumer goods. “We expect im-porters and exporters to save 25 [percent] to 30 percent on cost due to the WTO-TFA, which we have

ratified. We expect this to be passed on to consumers,” he said during Samahang Plaridel’s Kapihan sa Manila Hotel held on Monday.

“[The TFA] would improve our competitiveness, especially if we’re able to implement all provisions concerning logical costs,” Cris-tobal added. The TFA has already been signed by President Aquino,

B C U. O

THE Philippines’s poor imple-mentation of its policies on migration prevents it from

maximizing gains from its export of labor, according to the latest report of the United Nations. In its report, titled “Asia-Pacific Migration Report 2015: Migrants’ Contributions to Development,” the UN Economic and Social Commission for Asia and the Pacific (Unescap) said migration policies in the Philippines are comprehensive but not imple-mented properly. “The policies in place in the Phil-ippines and Sri Lanka are clearly de-fined [but] these policies may not be fully implemented, thus, reducing their positive contribution,” the report read.

Unescap said the Philippines ac-tually has the “most comprehensive policy framework” on migration in the entire Asia and the Pacific. The country has several “legislative acts, presiden-tial decrees and executive orders” that provide guidelines on temporary and permanent migrants.

Among these are the Migrant

Workers and Overseas Filipinos Act of 1995, which was enacted in 2007. It regulates the Philippine Overseas Em-ployment Administration, the Over-seas Workers Welfare Administration (OWWA) and established the National Reintegration Centre for Overseas Filipino Workers (NRCO). Further, there is a welfare fund for overseas workers, which was established within the Department of Labor and Em-ployment (DOLE) as early as 1977. This fund was renamed the OWWA in 1987 and is attached to the DOLE. It is tasked with protecting and promoting the welfare of overseas Fili-pino workers (OFWs).

Apart from these, the Unescap said there were 60 migration-re-lated provisions in the seven chap-ters of the Philippine Development Plan (PDP) 2011-2016, the country’s economic blueprint.

“Labor migration can reduce un-employment in the source country and improve the skills of the popula-tion, with the right policies and sup-port services in place. If not, it can lead to a loss of needed skills in the

Crude oil slipped for a second day and copper led declines among industrial metals. Steep losses on global stock mar-kets and volatility in currencies this year had fueled calls for G-20 mem-bers to do more to stoke demand and bolster stability. While finance ministers from the world’s biggest economies didn’t come up with coor-dinated stimulus, they did agree to use monetary, fiscal and structural tools to support growth. They also reiterated pledges to refrain from competitive devaluations, with Eu-rogroup chief Jeroen Dijsselbloem-noting that there was some concern surrounding Japanese policies.

The G-20 was “underwhelming,” said Ray Attrill, National Australia Bank Ltd.’s global cohead of foreign-exchange strategy in Sydney. There was an “admission of downside growth risks, but no tangible com-mitments to fiscal policy action in particular to bolster growth in the short term,” he said. Central banks proved critical in avoiding a global depression last decade, though there is now no consensus among officials from the world’s top economies for an increase in stimulus. The Interna-tional Monetary Fund last month trimmed its global growth projec-tions and said 2016 would be a “year of great challenges.”

StocksTHE MSCI Asia Pacific Index fell 0.5 percent as of 7:06 a.m. London time. Standard & Poor’s 500 Index futures slid 0.6 percent and con-tracts on the Euro Stoxx 50 Index lost 1.2 percent.

Japan’s Topix index dropped 1 percent, after gaining as much as 1.7 percent. Nissan Motor Co. jumped as much as 12 percent, the biggest intra-day gain since 2009, on plans for a record share buyback. The Shanghai Composite slumped 2.9 percent and Hong Kong’s Hang Seng Index declined 1.3 percent. “There is little coming out of the G-20 to suggest major improve-ments in the policy mix of the most systemically important countries,” Mohamed El-Erian, chief economic adviser at Allianz SE, wrote in a Bloomberg View column published on Monday. “With little hope for major policy changes, global eco-nomic growth will continue to struggle, the trifecta of national inequality [of income, wealth and opportunity] will worsen and fi-nancial volatility will increase.”

CurrenciesTHE yen strengthened for the first time in four days, rising 0.9 percent to 113.01 per dollar. It’s risen 7.2 percent in February, more than double the gain of any other major currency. Eurogroup chief Jeroen Dijssel-bloem said in Shanghai on Saturday that “there was some concern that we would get into a situation of com-petitive devaluations” with regard to Japan. Japanese Prime Minis-ter Shinzo Abe told parliament on Monday he is not trying to influence foreign-exchange rates, and that an excessively strong yen has been cor-rected under his economic-reform program, dubbed Abenomics. The currency was trading around 85 per dollar when Abe took office in December 2012.

China’s y uan dec l ined 0.1

percent, retreating for a seventh day as China’s central bank lowered the currency’s reference rate after upbeat US economic data gave a lift to the dollar. The Bloomberg Dol-lar Spot Index fell 0.1 percent, fol-lowing a 0.7-percent gain on Friday that marked its best performance of the year.

The kiwi weakened 0.6 percent, extending Friday’s 1.4-percent slump. A gauge of business confi-dence fell and home-building ap-provals declined, reports showed on Monday. ANZ Bank New Zealand Ltd. said on Monday it now predicts the Reserve Bank of New Zealand will reduce its benchmark interest rate twice this year, having previ-ously forecast no change.

CommoditiesCRUDE oil declined 0.3 percent to $32.68 a barrel, set for a fourth monthly decline. Prices are sliding on speculation a worldwide surplus will be prolonged amid increased ex-ports from Iran and US stockpiles that are at the highest in more than eight decades. Copper prices fell 1.1 percent in London, nickel lost 0.6 percent and zinc dropped 0.5 percent. A London Metal Exchange gauge that tracks industrial metals was headed for a 3.4-percent gain in February, after sliding in all but one of the previous nine months.

BondsINDIA’S bonds extended gains af-ter the government pledged to stick with its budget-deficit target in the fiscal year starting April. The 10-year yield dropped 10 basis points to 7.68 percent. The rate on similar-maturity US Treasuries retreated two basis points to 1.74 percent, extending this month’s decline to 18 basis points. Bloomberg News

C ACHINA’S central bank cut the amount of cash the na-tion’s lenders must hold as

reserves, stepping up efforts to cushion an economic slowdown amid plunging stock prices and a weakening currency. The required reserve ratio for the banks will drop by 0.5 percent-age points effective March 1, the People’s Bank of China said on its

web site on Monday. US stock-index futures pared declines after China stepped up ef-forts to cushion an economic slow-down in the country. Standard & Poor’s (S&Ps) 500 E-mini contracts expir ing in March trimmed losses to 0.4 per-cent, trading at 1,935.5 at 10:12 a.m. in London, after sliding as much as 0.8 percent earlier. China

said it will cut its reserve require-ment ratio by 0.5 percentage point to maintain liquidity in the finan-cial system. Dow Jones Industrial Average futures fell 0.3 percent to 16,544.

The S&P 500 snapped a two-day rally on Friday after signs of firm-ing inflation fueled speculation interest rates may rise sooner than previously expected. Bloomberg News

China cuts reserve ratio to cushion slowdown

news@businessmirror.com.phBusinessMirrorTuesday, March 1, 2016A2

BMReportsAsian stocks. . . C A

Unescap. . . C A

country and a de-skilling of migrants,” Unescap said.

Data showed that the Philip-pines is the sixth largest supplier of OFWs in the Asia-Pacific region and is the third top recipient of remittances among developing countries. In 2013 there were 5.48 million migrants from the Philip-pines. The top migrant supplier is India with a total of 14.166 million, followed by the Russian Federation with 10.84 million. In 2014 Unescap said the Philp-pines received $28.4 billion worth of remittances. India was the top remittance receiver with a total of $70.39 billion followed by China with $64.14 billion. “The largest three recipients,”— India, China and the Philippines—received $163 billion or almost 40 per-cent of the $435 billion in remittances received by developing countries in 2014,” the report stated. Unescap said over 95 million peo-ple from Asia and Pacific countries lived outside their countries of birth, and that the region hosted over 59 million migrants.

While there are many reasons to

migrate, the majority of these migrants are temporary migrant workers.

Asia Pacific also hosts over 5.5 mil-lion refugees, and three of the main refugee-hosting countries in the world are in the region.

“Many migrant workers not only benefit from their migration, but they also contribute to the develop-ment of their countries of origin and destination through their work and the remittances they send home,” Unescap said. “However, migrants also face hardships and abuse, so action needs to be taken to maximize these ben-efits by ensuring that migration is or-derly, safe, regular and responsible,” it added. Unescap Deputy Executive Secre-tary Hongjoo Hahm said the scale of migration is likely to increase in Asia and the Pacific, and the outcome of this trend is in the hands of the countries of the region. Migration policies, Hahm said, should be aligned with national de-velopment priorities and promote conditions of dignity and respect for the rights of migrant workers.

This is important since many coun-

tries place restrictions not only on the entry of migrants into the country but also on their rights and their ability to access social protection.

“Business-as-usual risks height-ening inequal ity, holding back advances in productivity and fa-cil itating human-rights abuses,” Hahm said. “Posit ive outcomes require policies aligned with na-tional development strategies and international standards promot-ing fair recruitment, decent and p r o d u c t i v e e m p l o y m e n t a n d social protection.” The Unescap report provides guidance on the steps countries, regional organizations, civil-society actors and others can take to improve positive impacts.

The Asia-Pacific Migration Report 2015: Migrants’ Contributions to De-velopment is the result of a collab-orative effort of the members of the Regional Thematic Working Group on International Migration, including Human Trafficking. The group is composed of the Unescap, International Organiza-tion for Migration and International Labor Organization.

BusinessMirrorwww.businessmirror.com.ph Tuesday, March 1, 2016 A3

BMReports

At the Tapatan sa Aristocrat fo-rum on Monday, former Agriculture Secretary William Dar said in the five-and-a-half years of the Aquino administration, the farm sector only posted a growth of 1.6 percent. 

“We grew more than 6 percent in terms of GDP, the whole country; but the growth of agriculture has been very pathetic. Last year the growth was only 0.11 percent, and to look at the last five-and-a-half years, it has only grown an average of 1.6 per-cent; so this is clearly a very dismal performance of this administration in terms of agriculture,” Dar said. 

Dar added that in the post-Fer-dinand E. Marcos period, agricul-ture growth averaged 2.7 percent, significantly higher than the recent performance of the sector. 

He said agriculture growth av-eraged 1.8 percent under former President Corazon C. Aquino; 0.8 percent under then-President Fidel V. Ramos; 6.5 percent under former President Joseph E. Estrada; and 2.8 percent under former President Gloria Macapagal-Arroyo. 

The former agriculture secretary said every administration must aim to grow agriculture by an average of 4 percent to increase the farm sec-tor’s contribution to GDP. 

Dar added that the sector used to account for around 20 percent of GDP. However, in recent years, its contribution has declined to around 10 percent of GDP. 

Nonetheless, Dar said if the sector’s value addition to industry through food manufacturing is giv-

en a boost, this would increase the sector’s contribution by 15 percent to 20 percent. 

With this, the total contribution of agriculture to the economy could be around 25 percent to 30 percent of GDP. Apart from growth, the farm sector accounts for about a third of the country’s poor. Dar said around 40 percent of farmers are poor. 

So clearly, he added, that focus-ing on the farm sector can help the next administration make economic growth more inclusive. 

“Agriculture is really such a big sector not to be given priority by the government,” Dar said. 

Apart from boosting the farm sec-tor and lifting millions of farmers from poverty, the next administra-tion must also address inequalities in the tax system.

Punongbayan and Araullo Presi-dent and CEO Ma. Victoria Españo said the next administration’s eco-nomic agenda must include a com-prehensive tax reform. 

Españo said lowering income tax is not enough to make the tax system fair for all Filipinos. There should be reforms made on the tax rate, tax brackets and even exemptions to make the tax system more equitable. 

“The proposal that we hear is we should lower the tax of employees. Normally, people would think if you have so many public services to finance, where will the government get the funding? And that’s why there’s a lot of opposition from the government whenever that proposal is raised. So we would always say we

need a comprehensive tax reform,” Españo said.  In a recent Senate Cen-tennial Lecture Series  on Tuesday, experts from the Philippine Insti-tute of Development Studies (PIDS), Department of Finance and the Tax Management Association of the Phil-ippines agree that the country’s tax system needs to be changed. 

The country’s personal income tax (PIT), specifically, has not been updated since the 1997. This has

resulted in what is called “bracket creep,” where low-income taxpayers “hurt more” than their high-income counterparts. Bracket creep, PIDS senior research fellow Rosario G. Manasan explained, has occurred because of the “nonindexation” to inflation of PIT brackets. 

This means that the coverage of each tax bracket does not take into consideration the current value of the peso.  Manasan said this pres-

ents a problem because the current value of the Philippine peso, using the 2014 Consumer Price Index, is already less than half of its value in 1998. 

This means that an annual in-come of P210,000 a year in 2014 is only equivalent to P105,000 in 1998. 

With this, taxpayers earning P210,000 should only be paying P15,500 worth of tax, or 14.8 percent, instead of P40,000, or 19 percent.

B R M

‘IF China does not heed our collective call, does it mean that China considers itself

above the law?” Thus, declared Foreign Secre-

tary Albert F. del Rosario after his counterpart from China, For-eign Minister Wang Yi, on Thurs-day accused the Philippines of “political provocation” amid an ongoing international arbitration regarding territorial claims in the South China Sea, or West Philip-pine Sea (WPS) to the Philippines

The arbitration was initiated by the Philippines in early 2013, after Beijing refused to remove its ships from a disputed shoal, and claimed that Beijing’s territorial assertions do not comply with the 1982 United Nations Convention on the Law of the Sea that should be declared invalid.

“We note that Foreign Minister Wang said that China is a member of the international community, and that it abides by international law. We have had countless meet-ings with China to try to address

the issue between the two of us to no avail,” del Rosario said. “We have invited China many times to join us in arbitration as early as 2012, again to no avail.”

“As we presume to be respon-sible states, the Philippines, as well as the international commu-nity, is asking China to respect the forthcoming ruling of the arbitral tribunal and together advance an international rules-based regime,” del Rosario stressed.

Wang said the Philippines’s de-cision of lodging a case with the tri-bunal in The Hague was “irrespon-sible to the Filipino people and the future of the Philippines,” even as China had refused to participate in the arbitration process, denounc-ing it as being “illegitimate.”

The tribunal had decided last October that it could hear the case. A ruling is expected to be announced sometime in May this year.

China has earned the condem-nation, not only from the Philip-pines and Vietnam for its aggres-sive stance in the WPS, but also by other nations, which have ex-

pressed alarm over China’s setting up of missiles in Woody Island in the Paracels and radar installations in Cuarteron Reefs in the WPS.

Experts said it would not be long before China could be able to militarize the area and declare

an air-defense identification zone (Adiz) in the WPS, a vital sea lane through which passes some $5 trillion worth of global trade. The seabed is also believed to harbor commercial amount of gas and oil, besides being a rich fishing ground

for the surrounding littoral states. China’s arming of the WPS is-

lands came following a two-year reclamation spree in the contested area, which is also being claimed by Taiwan, Brunei Darussalam, Malaysia and Vietnam.

Wang blamed Philippine  of-ficials for not negotiating with Beijing and filing the arbitration without China’s consent. The Phil-ippines has always argued about the difficulty of sitting down with Chi-na, who prefaced their argument that China has indisputable sov-ereignty over the rest of the WPS.

“We are neighbors just sepa-rated by a narrow body of water,” Wang told the Center for Strategic and International Studies think tank in Washington. “We want to contribute to the Philippines’s

economic development.” Wang was in Washington last week for talks with US Secretary of State John F. Kerry after the US said China’s con-struction has increased tension in the region, and after US ships and airplanes conducted freedom of navigation sorties in the islands just recently occupied by China.

 Wang said its military facilities on the island are needed for self-defense because other countries have a lready mi l itar ized the shores. The country also report-edly plans to build civilian infra-structure, like weather stations and emergency harbors, to benefit the international community.

Wang also added that, while China had stopped reclaiming the land, other countries have not backed off.

‘P-Noy not doing enough to boost agri sector’B C U. O

THE Aquino administration has failed miserably in its efforts to boost the agriculture sector,

registering one of the lowest average farm growths in almost three decades. 

‘Word war’ between PHL, China envoys escalate ahead of May international arbitration decision We have had countless meetings with China to try to address

the issue between the two of us to no avail.”–del Rosario

PROTEST leader Elly Pamatong burns a Chinese �ag from across the US Embassy in Manila to protest recent island-building and alleged militarization by China of the disputed Spratlys group of islands in the South China Sea on Monday. The protesters also lauded the US military for its presence in the South China Sea. AP

RUSTIC CHARM A farmer who lives at the foot of the majestic Mayon Volcano in Legazpi, Albay, inspects the rice paddies. Rice farming is one of the province’s major livelihoods. NONIE REYES

Average agriculture-sector growth in the last five-and-a-half

years, slowest in three decades

1.6%

BusinessMirrornews@businessmirror.com.ph Editor: Max V. de Leon • Tuesday, March 1, 2016 A5

AseanTuesdayThailand has ‘100 billion’ reasons to legalize casinos

MORE than 100 billion baht a year in tax revenue is expected to pour into state

coffers if casinos are legalized in Thailand, according to a study con-ducted by the dean of Rangsit Univer-sity’s College of Social Innovation.

The estimated revenue excludes contributions from tourism and conferences, Sungsidh Piriyarang-san said. He said it took three years for the Singaporean government to see annual tax revenue from legal casinos reach the 100-billion-baht threshold, but Thailand should take less time since the country had plenty of tourist attractions. The idea of legal casinos was floated by former National Police chief Somyot Poompunmuang last year.

However, the proposal lost steam after Prime Minister Prayut Chan-o-cha put the brakes on the idea.

The call for legal casinos is noth-ing new, as the idea was raised by

government in 2008 and the Yin-gluck Shinawatra government in 2011. Sungsidh said casinos could be legalized only after winning wide-spread public support and with the backing of an honest government and operators interested in running the business.

An increasing number of middle-income earners agree with the con-cept of legal casinos in Thailand, he said.

He reiterated that the Prayut government had shown no support for the idea.

To alleviate the negative impact from legal casinos, Singapore’s laws governing the business are a good example for Thailand to follow, he said.

The Singaporean government permits only those aged 21 or older to enter and place bets at legal casinos.

Anyone deemed to have a gambling problem can be barred from entering.

Sungsidh said legal casinos would also boost the number of foreign tourists visiting the country by 40 percent to 50 percent, based on the models of Singapore and Macau.

Legalization would also reduce

the number of criminal cases, he said.The study found Sa Kaeo province

on the Cambodian border had a lower number of criminal cases, as the legal casinos in Cambodia helped to create jobs and boost incomes.

At present, Thailand and Brunei are the only two Asean members without legal casinos, Sungsidh said. Neighbouring countries are home to at least 120 legal casinos, mostly in Cambodia and Lao PDR.

Sungsidh’s team surveyed 2,500 Thais during May to August last year.

Most respondents agreed with the idea of a legal casino-resort complex, saying it would create jobs and boost tourism revenue.

In addition, Thai casinos would keep local gamblers from visiting casinos abroad.

But the survey also uncovered concerns about crime fostered by casino culture and violations of religious principles and ethics.

Sungsidh suggested if the govern-ment decided to legalize casinos, it must use the revenue generated from the business to help society.

It must also allow people to examine the source of revenue in a transparent manner, he added. MCT

VIETJET Aviation Joint Stock Co., the Vietnamese carrier known for its bikini-clad flight

attendants, may hold its initial public offering (IPO) as early as the second quarter, as it plans to build global routes and become a top budget air-line in Asia.  

The IPO’s exact timing will depend on market developments domestical-ly and globally, Nguyen Thi Phuong Thao, CEO of Vietnam’s only privately owned airline, said in an interview on Friday. The company hasn’t finalized how much it wants to raise and could offer as much as a 30-percent stake, the regulatory limit for foreign hold-ings, she said.

“We plan to make VietJet a global airline,” Thao said from her Hanoi of-fice. “We look at Emirates, which came from a country with a small popula-tion and has become a global airline. We want to make VietJet the Emir-ates of Asia.”

The Dubai-based carrier is the world’s biggest long-haul airline with flights to about 150 destinations, and said last month it plans to add 37 new planes—worth $14.5 billion at list prices.

Bikini-clad attendantsVIETJET, which featured dancing flight attendants clad in bikinis on an inaugural route and bikini models on its airplanes for a desktop calendar, carried 9.3 million passengers in 2015, an increase of 66 percent from 2014. Revenue soared 205 percent last year to 10.9 trillion dong ($488 million), while net income rose to almost 1 tril-lion dong, according to the company. The airline expects revenue to double this year and passenger capacity to reach 15 million this year.

VietJet will probably surpass na-tional carrier Vietnam Airlines as the nation’s biggest domestic carrier this year, according to  Centre for Asia Pacific Aviation (Capa)-Centre for Aviation. Vietnam is expected to rank among the world’s 10  fastest-growing aviation markets in the next two decades, according to the International Air Transport Associa-tion. “It’s an ideal market for low-cost carriers [LCCs],” said Brendan Sobie, Singapore-based chief analyst at Ca-pa-Centre for Aviation. “This makes VietJet an attractive scenario for investors. They don’t have the risks other LCCs have in terms of overca-pacity and competition.”

Regional expansionTHE low-cost carrier is seeking to ex-pand in a market that’s grown 20 per-cent annually in the last three years, according to the airline. VietJet earlier this month signed a $3.04-billion deal to buy Pratt & Whitney engines to out-fit 63 Airbus A320neo and A321neo airplanes it contracted last year. The company plans to add a dozen planes annually to its fleet of 42 planes at year-end, Thao said. It wants to have a fleet of 100 by 2020.

It also plans to expand interna-tional routes to cities in South Korea, Malaysia, China and Japan this year, Thao added.

Moving beyond VietJet’s core low-cost business to long-range interna-tional routes will require a lot of invest-ment in larger aircraft and developing an international brand, Sobie said. “It’s a riskier and harder market to get into.” In Vietnam, he added, the carrier has “first-mover advantage.”

The IPO is also being planned as Bloomberg Asia Pacific Airlines Index slumped 14 percent this year, reversing a 19-percent gain in 2015. Vietnam’s VN Index, Southeast Asia’s best per-former last year, has fallen 2.2 percent since the start of 2016. The benchmark gauge fell 0.2 percent as of 10:10 a.m. local time.

Still, the stock sale is being planned as frontier-market equity funds from Sweden to Hong Kong are ready to buy more Vietnamese stocks, at-tracted by cheap valuations and the fastest-economic growth in almost a decade. Coeli Asset Management and Asia Frontier Capital say they plan to add to their equity holdings this year, as record-high foreign di-rect investments and the nation’s free-trade agreements help boost economic growth.

VietJet, founded in 2007 by Thao, competes with national carrier Viet-nam Airlines, which owns 70 percent

100B bahtForeseen revenues that the Thai government can generate if casinos

are legalized in the country

9.3MNumber of passengers carried by VietJet in 2015, an increase of 66 percent from 2014.

of budget carrier Jetstar Pacific Air-lines Aviation JSC , with Qantas Air-ways Ltd. holding the remaining 30 percent. Vietnam Airlines also owns Vietnam Air Services Co., known as Vasco, which it plans to split off as a commuter service.

“We are ready to go to the next level,” said Thao. “We’re ready to take the opportunities that the country’s international integration will bring.”

Hot pickTUNDRA FONDER says it wants to buy consumer, industrial and construction companies.

Vietnam’s VN Index is priced at 1.68 times net assets, near a three-year low, after the gauge almost entered a bear market in January as rising US interest rates and a sell-off in emerging mar-kets sparked outflows. The govern-ment’s growth target of 6.7 percent in 2016 will be among the world’s fastest, girded by rising domestic demand and foreign investment. HSBC Holdings Plc. is bullish on Vietnam as attractive valuations and its economic resilience makes it a “rare bright spot,” according to a report on February 22.

“We will continue to allocate additional capital to the market; we like the consumption theme which benefits from the significant wage uplift as workers migrate from local factories to FDI-related businesses,” James Bannan, a portfolio manager at Coeli in  Malmo, Sweden,  wrote by e-mail. “We remain very positive on Vietnam’s prospect.”

Bannan, who boosted his holdings in 2015 when the VN Index rallied 6.1 percent, has 14 percent of funds fo-cused on Vietnam, one of his largest allocations. His investments there re-turned 27 percent in dollar terms last year, he said. The benchmark gauge fell 0.1 percent as of 9:18 a.m. local time on Monday.

Hong Kong-based Andreas Vogel-sanger, CEO of Asia Frontier Capital’s AFC Vietnam Fund, which has risen more than 40 percent since its incep-tion two years ago, said Vietnam’s trade pacts and inflows of foreign invest-ments are key reasons the country will outperform Asian markets. 

Shamoon Tariq, a Stockholm-based money manager at Tundra, said consumer spending and structural reforms will underpin Vietnam’s eco-nomic turnaround. Vietnam Dairy Products JSC, country’s biggest com-pany, has rallied 13 percent in the past month. Petro Capital & Infrastructure Investment JSC, a builder, has jumped 36 percent.

Political transitionVIETNAMESE shares have risen 8.5 percent from this year’s low on Janu-ary 21, approaching its 100-day moving average. The rally comes even as re-formist Prime Minister Nguyen Tan Dung lost his bid  to become Com-munist Party chief in January  in a political transition that takes place once every five years. The shift fueled initial concern as to whether the new leadership will accelerate Dung’s ef-forts to reform bloated state-owned enterprises and open the country to foreign investors. 

General Secretary Nguyen Phu Trong was reelected to the position for a second term, while Deputy Prime Minister Nguyen Xuan Phuc was nomi-nated to replace premier Dung when his term ends in July. Le Hoai Trung, deputy foreign minister, said on Janu-ary 28 the reforms have brought about significant results and Vietnam “would go forward with it.”

“Any political instability is obvi-ously negative for markets, but we tend not to invest in companies or industries that are overly exposed to changes in government,” Bannan said. “We are not too concerned about the outcome given the historically consensual approach to decision-making.” Bloomberg News

THAI police forensic o�cers examine the site after a car bomb attack in Pattani province, southern Thailand, on Saturday. A roadside police patrol camp was attacked by an improvised car bomb that left seven o�cers and two civilians injured. Police Col. Keerati Waeyoosoh said the attack was believed to have been carried out by Muslim insurgents. AP

previous governments but went down to strong public criticism.

The idea came up under the Thaksin Shinawatra government in 2004, the Samak Sundaravej

Vietnam’s bikini-clad carrier seeks IPO in drive to be ‘Emirates of Asia’

SINGAPORE missed its targeted receipts from tourism last year and said 2016 figures may remain flat as global economic uncertainties

curb visitor arrivals.Tourism receipts fell 6.8 percent to S$22 billion

($16 billion) in 2015, largely because of a decline in business visitor arrivals and spending, the Sin-gapore Tourism Board (STB) said on Monday in a statement citing preliminary estimates. The board said it forecasts receipts of S$22 billion to S$22.4 billion this year.

“Global economic growth may be hampered by the slower growth momentum of the Chinese and US economies, as well as uncertainties, such as ongo-ing reforms in China and the impact of the normal-ization of the US monetary conditions,” the board said on the outlook for 2016. “Increasing regional competition will also pose challenges to Singapore’s tourism sector.”

Tourism receipts from Malaysia, Indonesia and Australia fell the most by 26 percent, 21 percent and 10 percent, respectively, according to the state-ment. These markets faced economic challenges and their currencies depreciated against the Singapore dollar, leading to fewer visitor arrivals and smaller spending, the board said.

Visitor arrivals rose 0.9 percent to 15.2 million in 2015, and are expected at 15.2 million to 15.7 mil-lion this year, the board said in the statement. The city-state forecast S$23.5 billion to S$24 billion in

tourism receipts for 2015, according to a statement in March last year.

This performance came on the back of various headwinds, such as an uncertain global economic outlook and weak currencies in some of Singapore’s top source markets in 2015, STB explained.

“As the average BTMICE [business trips, meet-ings, incentives, conferences and exhibitions] visi-tor spends about two times more than the average leisure visitor, the fall in BTMICE visitor arrivals and spending due to companies cutting back on both travel and trip budgets has had a significant impact on our tourism receipts,” STB CEO Lionel Yeo said. The top growth markets for 2015 tourism receipts were Japan and Britain. Tourism receipts from Ja-pan rose due to greater BTMICE traffic, while more leisure visitors from Britain who also spent more helped to boost tourism receipts.

The decline in tourism receipts was most keenly felt in Indonesia, Australia and Malaysia markets. These markets had faced economic challenges and seen their currencies depreciated against the Sin-gapore dollar. Consequently, there were fewer visi-tor arrivals and less spending from these markets.

The top growth markets for 2015 visitor arrivals were China, which increased 22 percent, followed by India and South Korea. Notably, there were more visi-tor arrivals from first- and second-tier cities in China and India, where STB had intensified its marketing and channel development efforts. Bloomberg News, PNA

IN this February 15 �le photo, President Barack Obama (right) stands with the Singaporean Prime Minister Lee Hsien Loong at a meeting of Asean at the Annenberg Retreat at Sunnylands in Rancho Mirage, California. AP

Singapore misses tourism receipts on economic uncertainties

The WorldTuesday, March 1, 2016 * Editor: Lyn Resurreccion BusinessMirrorA6

U.S. Secretary of the Treasury Jacob Lew (left) talks with Chinese Premier Li Keqiang in Zhongnanhai Leadership Compound in Beijing, China, on Monday. WU HONG/POOL VIA AP

China assures US no currencydevaluation as it pushes reforms

Premier Li Keqiang’s com-ments to Lew on Monday were in line with a joint declaration by financial officials from the Group of 20 (G-20) biggest rich and de-veloping economies who met over the weekend in Shanghai.

They pledged to avoid devalu-ations to boost sagging trade and urged governments to speed up reforms to boost slowing global growth. Beijing is under pressure to reassure global finan-cial markets it has its economy under control, following stock and currency turmoil.

The G-20 finance officials’ as-surance that global growth was still on track despite risks of a further deceleration appeared to fall flat: Share prices fell in most Asian markets on Monday, with the Shanghai benchmark dropping as much as 4.4 percent to close down 2.9 percent at 2,687.98. Li told Lew is moving ahead with a long-range plan to reduce excess

production capacity in industries in which supply exceeds demand, according to a deputy Chinese fi-nance minister, Zhu Guangyao. He said regulators would focus first on steel and coal, huge industries with millions of workers.

In a report in mid-February, the European Union Chamber of Commerce in China complained the ruling Communist Party’s failure to eliminate unneeded production capacity in indus-tries, including steel, cement

and glass, has worsened China’s economic slowdown. Steel pro-ducers have responded to the glut by slashing export prices, hurt-ing sales by foreign competitors.

That prompted a protest on February 14 by thousands of steelworkers in Brussels, seat of the European Union. “Premier Li Keqiang told Secretary Lew that, as China moves forward in reduc-ing overcapacity, we will focus on two areas, the steel and coal sectors,” Zhu said. “And in the process of reducing overcapac-ity, we will properly handle the issue of unemployment.”

The ruling party is in the midst of a marathon effort to replace a worn-out growth model based on trade, investment and heavy industry with a more self-sustaining expansion driven by consumer spending.

Growth in the world’s second-largest economy slowed last year to a 25-year low of 7.3 percent, and is expected to decline further this year. In coal, regulators expect to eliminate some 1.8 million jobs, the minister of human resources, Yi Weimin, said at a separate event on Monday. That would be equiva-lent to about 17 percent of the 10.3 million people the China National Coal Association said last year are employed by the industry.

In steel, regulators have elimi-nated some 90 million tons of production capacity over the past three years and plan to close an-other 150 million tons in the next three to five years, according to

Zhu. China’s steel production last year was about 800 million tons, or half the world total.

Beijing announced a 100-billion-yuan ($15 billion) fund last week to cushion the blow to workers who lose their jobs in the restructuring, and help them find new jobs.

“We believe this fund will play a very important role in this pro-cess,” Zhu said.

Li affirmed Chinese pledges to avoid devaluing its yuan to boost exports, according to Zhu.

A key concern of financial mar-kets, despite repeated Chinese de-nials, is that Beijing plans to allow its yuan to weaken further, fol-lowing a surprise introduction of a new mechanism in August to set its state-controlled exchange rate.

Lew urged Beijing to move to-ward a “more market-determined exchange rate in an orderly man-ner,” according to a Treasury state-ment. The premier told Lew the yuan, also known as the renminbi, will be “basically stable” and sub-ject to a “managed float” based on a basket of currencies, Zhu said.

“China does not intend to de-value the renminbi to engage in a trade war,” Zhu said.

The shift to what China’s cen-tral bank says is a more market-oriented exchange rate has allowed the yuan to drift lower against the dollar, even as Chinese leaders said they had no plans for a “continuous devaluation.” On Monday the yuan weakened by just under 0.1 percent from Friday’s close to 6.5478 to the dollar. AP

B ERLIN—German Chancel-lor Angela Merkel on Sun-day called the actions of

protesters who shouted abuse at a bus full of migrants “repulsive” and “unjustifiable.”

Video of about 100 people try-ing to block migrants from entering a shelter in the eastern village of Clausnitz on February 18 prompted concern about growing extremism in Germany. The number of far-right attacks on migrants has in-creased significantly over the past year, as more than a million people came to Germany seeking asylum.

Merkel told public television ARD late Sunday that she sees a “polarization” in Germany society, but insisted that her decision in September to keep the country’s borders open to migrants had been right. “I think we’re doing better than some people think, but we’ve got a way to go,” she said. To those

who have opposed her course, at time vehemently, Merkel said she was willing to listen. “They aren’t convinced yet, but I think that I can convince them if the issue is resolved, but we need a certain amount of time for this.”

Merkel said her government is working to solve the problems caus-ing people to flee to Europe, but added that those coming to Germa-ny have to abide by its laws, citing what she called the “devastating” incident in Cologne at New Year, when scores of women were robbed and sexually assaulted by men of mostly North African origin.

“Rules must be clear from the start,” she said. “Integration isn’t just a voluntary matter.” Merkel’s center-right party faces its first electoral test since the migrants surge on March 13, when voters elect new regional parliaments in three of Germany’s 16 states. AP

Angela Merkel calls mob that screamed at migrants ‘repulsive’ 

PEOPLE carry a body of one of the migrants that were drowned, as they were trying to reach Greece, at a port in Bakilesir, Turkey, on Monday. Turkey’s state-run news agency says dozens of migrants attempting to reach Greece have drowned after their boat sank o� the Turkish coast. The boat capsized in the Bay of Edremit, which is just a short distance away from the Greek island of Lesbos. The drownings came as Germany’s Chancellor Angela Merkel is visiting Ankara to discuss the migrant crisis with Turkish o�cials. IHA VIA AP

T EHRAN, Iran—Iranian re-formists appear have won all 30 seats representing

the nation’s capital in parliament, a definitive rebuke to the hard-liners opposing President Hassan Rou-hani’s efforts to open the economy and cooperate with the West.

In the first elections held since last year’s nuclear deal, none of Iran’s three main political camps—reformists, conservatives and hard-liners—is expected to win an outright majority in the 290-seat parliament, but early results indi-cate the best reformist showing in more than a decade.

Moderate conservatives also gained seats, and if their tenta-tive coalition with the reformists holds, they could end the domina-tion of parliament by hard-liners who were opposed to the nuclear deal. The reformist gains reflect strong public support for the agree-ment’s promise of more economic opportunities now that the West has dropped crippling sanctions in exchange for limiting the nation’s nuclear program.

State television said Friday’s vote heralds “the end of the pres-ence of a powerful majority in the parliament that overshadowed decision-making apparatus in the country over the past decade.”

Rouhani thanked voters on Saturday night in a message that encouraged Iranians to help him end the nation’s isolation.

“The competition has ended. Now it is time to open a new way through unity between people and the government to have a new chap-ter in growth of the national econ-omy by using domestic strength and foreign opportunities,” he said.

Supreme Leader Ayatollah Ali Khamenei, who has final say on all state matters, called the vote “proof of democracy” at work in Iran.

But Khamenei also addressed hard-line concerns that greater integration with the West could undermine Iranian independence and morality. He urged the next parliament, which begins its work

in May, to remain vigilant against “foreign intervention,” and warned that democratic progress does not mean “integration into the global arrogance.” The Interior Ministry is expected to release final results on Monday. Provincial reports sug-gest that, of the first 185 districts reporting, 55 have gone to reform-ists, 66 to moderate conservatives and 64 to hard-liners.

Reformists hold fewer than 20 seats in the outgoing parliament and have been virtually shut out of politics since losing their parlia-mentary majority in the 2004 elec-tions. Nearly 55 million of Iran’s 80 million people were eligible to vote, and more than 60 percent turned out, based on partial results.

Iranians also elected a new As-sembly of Experts, 88 senior cler-ics whose most important role is to select a new supreme leader. The assembly is elected every eight years and could be asked to choose a successor to Khamenei, 76, who had prostate surgery in 2014.

Mehrnaz Hemmati, a 21-year-old tailor shop worker, said she voted for the coalition of reform-ists and moderates—and won’t celebrate until final results are an-nounced. “I expect more attention to be paid to job opportunities for women,” Hemmati said. “Rouhani, with help from the new parliament, should open doors to the world to bring in foreign investments.”

Mohammad Reza Shahabi, an accountant in a construction com-pany, hopes that with hard-liners losing some influence, “the govern-ment will have a more free hand in implementing deals with the world from now on. The elections should add to Rouhani’s power, since new lawmakers will not create barriers like before,” he said.

But Aida Ghorbani, an employee at an advertising and public rela-tions firm, remains doubtful.

“Based on experience, they can-not take big steps because of the greater influence of hard-liners in the government, however, I feel happy,” she said. AP

First Iran vote after nuclear deal gives reformists momentum 

IRANIAN journalists follow the preliminary results of parliamentary and Experts Assembly elections at the Interior Ministry in Tehran, Iran, on Saturday. Preliminary results early Saturday morning showed reformist candidates heading for their best showing in more than a decade in Iranian parliamentary elections, according to local media and election o�cials counting the ballots. A strong reformist showing would be a boost for moderate President Hassan Rouhani, who championed the newly implemented Iranian nuclear deal with world powers in the face of harsh hard-line opposition. AP

BEIJING—China’s premier told visiting US Treasury Secretary Jacob Lew on Monday his

government is pressing ahead with painful reforms to shrink bloated coal and steel industries that are a drag on its slowing economy, and ruled out devaluing its currency as a shortcut to boosting exports.

$15BFunds that Beijing earmarked to cushion the blow to workers who will lose their jobs in the restructuring.

The WorldBusinessMirror A7news@businessmirror.com.ph | Tuesday, March 1, 2016

LEESBURG, Virginia—Republican presidential front-runner Donald Trump is drawing criticism

for refusing to denounce an implicit endorsement from a white supremacist leader, with his main rivals, Sens. Ted Cruz and Marco Rubio, using the matter to hammer the billionaire businessman just two days before multiple state primaries could put him on an irreversible path to the party’s nomination.

White supremacist leaderat center of new Trump furor 

IN this February 26 �le photo, Republican presidential candidate Donald Trump gestures during a speech at a rally in Oklahoma City. Democrats increasingly view Trump as the likely Republican nominee and are seeking consensus on the best way to challenge the billionaire’s unpredictable appeal in a general election. AP

Trump was asked on Sunday on CNN’s State of the Union whether he rejected support from David Duke, the former Ku Klux Klan (KKK) Grand Dragon, and other white supremacists, after Duke told his radio followers this week that a vote against Trump was equiva-lent to “treason to your heritage.”

“Well, just so you understand, I don’t know anything about David Duke. OK?” Trump told host Jake Tapper. “I don’t know anything about what you’re even talking about with white supremacy or white supremacists.”

Trump was asked on Friday by journalists how he felt about Duke’s support. He said he didn’t know anything about it and curtly said: “All right, I disavow, OK?”

Trump hasn’t always claimed ig-norance on Duke’s history. In 2000 he wrote a New York Times op-ed explaining why he abandoned the

possibility of running for presi-dent on the Reform Party ticket. He wrote of an “underside” and “fringe element” of the party, concluding, “I leave the Reform Party to David Duke, Pat Bu-chanan and Lenora Fulani. That is not company I wish to keep.”

Trump’s comments sparked a wave of censures just ahead of Super Tuesday—March 1—when 11 states hold Republican prima-ries. At stake are 595 delegates to the party’s national convention this summer, with 1,237 needed to win the nomination. On the Democratic side, 865 delegates are up for grabs in Super Tuesday contests in 11 states and American Samoa. It takes 2,383 delegates to gain the Democratic nomination.

Hillary Clinton, who received another burst of momentum on Saturday after her lopsided vic-tory in South Carolina, turned

her attention to the Republican field on Sunday, al l-but-ignor-ing rival Bernie Sanders during campaign events in Tennessee.

Starting her morning with stops at two Memphis churches, Clin-ton offered an implicit critique of Trump, issuing a call to unite the nation and asking worshippers to reject “the demagoguery, the preju-dice, the paranoia.”

Asked by actor Tony Goldwyn, who later campaigned with Clinton in Nashville, about her thoughts on Duke’s support for Trump, Clinton described it, simply, as “pathetic.”

C l i nton’s S out h C a rol i n a victory was fueled by an 84-16 advantage among African-Americans, a key Democratic constituency that will also play a dominant role in several Super Tuesday states in the South.

Sanders acknowledged getting “decimated” in South Carolina, though he promised in an ABC interview to continue his cam-paign against what he describes as a political and economic oli-garchy. He avoided mentioning his huge South Carolina loss at a rally before more than 6,000 cheering people at an Oklahoma City convention center.

The latest shake up in the Re-publican race comes as attention shifts to the South, with about a half-dozen states in the region holding contests today.

Trump holds commanding leads across the region, with the excep-tion of Cruz’s home state of Texas, a dynamic that puts tremendous pressure on Rubio and Cruz as they try to outlast each other and derail Trump.

Campaigning in Virginia, Rubio pounced on Trump’s latest position on Duke, shifting to a more serious tone after spending the weekend mocking his rival’s hair and “the worst spray tan in America.”

“We cannot be a party who re-fuses to condemn white suprema-cists and the Ku Klux Klan,” the Florida senator told thousands of supporters gathered in Leesburg, Virginia. “Not only is that wrong, it makes him unelectable. How are we going to grow the party if we nominate someone who doesn’t repudiate the Ku Klux Klan?”

Cruz also weighed in on Sun-day, calling Trump’s comments “Really sad.”

“You’re better than this,” Cruz wrote. “We should all agree, rac-ism is wrong, KKK is abhorrent.”

Trump also garnered backlash on Sunday for recently retweeting a quote from Benito Mussolini, the 20th century fascist dictator of Italy, which reads: “It is better to live one day as a lion than 100 years as a sheep.”

Trump told NBC’s Meet the Press on Sunday, “I know who said it. But what difference does it make whether it’s Mussolini or some-body else? It’s certainly a very interesting quote.”

Trump has established him-self as the front-runner after winning three of the four early voting contests. That’s led Rubio and Cruz, both first-term sena-tors to unleash a personal and pol icy-based barrage against Trump, warning his nomination would be catastrophic for the Re-publican Party in the November election and beyond. AP

TOK YO —T h re e for me r Japanese utility executives have been formally charged

for alleged negligence in the Fuku-shima nuclear disaster, becoming the first ones from the company to go to criminal court.

National broadcaster NHK reported that a group of court-appointed lawyers on Monday indicted Tsunehisa Katsumata, chairman of Tokyo Electric Power Co. (Tepco) at the time of the crisis, along with two other Tepco execu-tives. The three men, charged with professional negligence, were not arrested. The indictment follows a decision by an 11-member judi-cial committee in July to send the three men to criminal court after

prosecutors had dropped the case.Experts say it may be difficult to prove criminal responsibility for failing to prevent the Fukushima meltdowns, but many people, in-cluding the residents affected by the disaster, say they hope that any trial would reveal more facts about the disaster and Tepco’s role that the utility has not disclosed.

The committee said last July that the three men neglected to take sufficient measures even though they were aware of the risk of a tsunami at the Fukushima plant. It said they should be charged with professional negligence re-sulting in death and injury during the accident and its aftermath, including the deaths of dozens of

senior citizens in a hospital who died during and after the lengthy evacuation. The Tokyo District Court has since selected a team of five lawyers to act as prosecutors to formally press charges in court.

Three reactors at the Fuku-shima Dai-ichi plant damaged in the March 2011 earthquake and tsunami suffered meltdowns, triggering massive radiation leaks that forced tens of thousands of people to evacuate. Government and parliamentary investigative reports have said Tepco’s lack of a safety culture and weak risk management, including an under-estimate of tsunami threats, led to the disaster. They said Tepco ignored tsunami safety measures

amid collusion with then-regu-lators and lax oversight. Tepco has said it could have been more proactive on safety measures, but that a tsunami of the magnitude that crippled the plant could not be anticipated.

While struggling with a cleanup at the wrecked Fukushima plant that will take decades, Tepco is hoping to restart two reactors at the Kashiwazaki-Kariwa plant in northern Japan. The disaster re-sulted in Japan taking all of its nuclear power reactors offline for checks. Of the 43 workable reac-tors in Japan, three have been put back online since last year, while the remaining are still offline for repairs or safety checks. AP

3 ex-officials of Tokyo Electric charged in Fukushima disaster 

IN this March 30, 2011, �le photo, Tokyo Electric Power Co., then-Chairman Tsunehisa Katsumata (center), with then-Vice President Sakae Muto (right), bows before a news conference at the company’s head o�ce in Tokyo. Three former Japanese utility executives, including Katsumata and Muto, were formally charged for alleged negligence in the Fukushima nuclear disaster on Monday, becoming the �rst ones from the company to face a criminal court. AP

COLUMBIA, South Caro-l ina—Hi l l a r y C l inton, fresh off her South Caro-

lina primary landslide, is shifting her focus to Republican front-runner Donald Trump, as her party seeks consensus on the best ways to challenge the bil-lionaire’s unpredictable nature in a general election campaign.

As Clinton nears the 11 state contests to be decided on Super Tuesday this week, allies of the former secretary of state, unaf-filiated Democratic strategists and the national party are stock-pi l ing potentia l ammunit ion about Trump, reviewing reams of court filings, requesting infor-mation about his business deal-ings from state governments and conducting new polls to test lines of attack.

Among the likely options: Ques-tioning Trump’s qualifications and temperament to be president, scrutinizing his business practices and bankruptcy filings, and reair-ing his inflammatory statements about women and minorities who will be central to the Democrats’ efforts in November.

“Is this the guy you would trust with the nuclear codes? Is this the guy you would trust with your son or daughter in the military? Is this the guy you would trust to run the economy?” asked Gov. Dan Malloy of Connecticut, a Clinton backer, pointing to a likely argu-ment from Democrats.

Clinton, celebrating her rout of Democratic rival Bernie Sand-ers in South Carolina’s primary, took direct aim at Trump’s mes-sage on Saturday night, telling supporters, “Despite what you hear, we don’t need to make America great again. America never stopped being great.”

While party leaders see Clinton in a favorable position against Trump, they caution that the real-estate mogul has shown a mastery of the media and an abil-ity to stay on offense throughout the Republican primaries. And they acknowledge Trump has suc-cessfully tapped into a deep vein of economic insecurity running through the electorate.

“Any race he is in is unpredict-able,” said David Brock, a Clinton supporter who oversees several Democratic super political ac-tion committees that support the former secretary of state. “Any strategy we come up with today is going to have to be awfully f lex-ible because we don’t know what to expect from this guy.”

Clinton aides and allies also worry that Trump’s unorthodox constituency of working-class white voters might allow him to put more states in play—particu-larly Midwestern swing states like Ohio and Wisconsin—compared to past nominees like Mitt Rom-ney and John McCain. And they note large voter turnouts in Re-publican primaries won by Trump.

But Democrats predict a Trump nomination could have a splin-tering effect on the Republican Party and are looking for ways to exacerbate it.

A new survey of 800 likely Re-publican voters commissioned by a Democratic polling firm found that 20 percent of Republicans are “uncertain” whether they would back Trump or Clinton in a head-to-head matchup.

The number included one-quarter of Catholics and one-third of moderates, according to the survey by the Democracy Corps’ Republican Party Project shared with The Associated Press.

The poll found Trump’s share of the vote drops among Catholics and moderates when Democrats describe him as an “ego-maniac,” “disrespectful to women,” un-trustworthy with the nation’s nuclear weapons and supporting a “big oil agenda.”

Republicans, Democrats ar-gue, haven’t mounted a sus-tained campaign to undermine Trump’s image as a successful dea l-maker. T hey env ision a more extensive cr it ique that would galvanize minority vot-ers and women against Trump.

Stephanie Schriock, the presi-dent of Emily’s List, which backs female Democratic candidates who support abortion r ights, said Trump’s derogatory com-ments about women during the primaries would mobilize female voters. She said as the “head of the party,” Trump would inf lu-ence Senate races in New Hamp-shire, Pennsylvania, Colorado and Florida.

Clinton’s campaign, mean-while, is increasingly pointing to Trump as the likely Republican nominee. Her rhetoric of “tear-ing down barriers” presents a contrast to Trump’s vow to build a massive wall along the Mexi-can border. In a recent fund-raising appeal, Clinton noted that Trump “riles up his crowds by calling Mexican-Americans criminals and suggesting Mus-lims should be banned from en-tering this country.” Her mes-sage underscored Democrats’ interest in holding Trump below 30-percent support among His-panics, a level few think would allow the businessman to win the White House.

While Trump spends far more time assailing his Republican rivals, he has previewed some attack lines he would likely use against Clinton, describing her as a liar and failed secretary of state who would have been in-dicted over her e-mail scandal were she not so cozy with Presi-dent Barack Obama. He has made clear he’s ready to take personal shots, bringing up Bill Clinton’s past infidelities, and suggesting she was complicit in what Trump has described as the former presi-dent’s abuse of women. AP

Clinton allies preparing for Trump nomination, fall campaign strategy

The WorldBusinessMirrorA8 Editor: Lyn Resurreccion • news@businessmirror.com.phTuesday, March 1, 2016

BusinessMirror

In the 1990s, inside steaming kitchens in Riyadh, Iranian chefs taught their counterparts how to season and cook Persian dishes for a Saudi-owned Iranian restaurant called Shayah. � e food proved so popular that nearly 20 years later, Shayah is a chain with 13 outlets in the kingdom, 11 of them in Riyadh.

� e bold signs on their store-fronts proclaiming the restaurants as the “House of Iranian Cuisine” are daring in a country where Iran is now viewed as an existential threat.

Despite Saudi-Iranian tensions,

the two countries have deep histor-ic links. For centuries, traders car-rying spices and rugs have traveled the Persian Gulf, landing on the shores of the Arabian Peninsula and weaving Iranian culture into Arab life.

A prominent Saudi prince, speak-ing to reporters this week in Abu Dhabi, said political tensions do not change that Arabs and Iranians “be-lieve in the same God, and the same prophet and the same holy book.”

“I don’t think there is any family in the Arabian Peninsula in general,

and Saudi Arabia in particular, that has not had, in one form or another, some kind of link to Iran in the past and vice-versa,” said Prince Turki al-Faisal, a former director of Saudi in-telligence.

In Bahrain, where Shiites are the majority, many villages have Per-sian names and many speak Farsi at home. In Kuwait, some of the wealthiest families and businessmen are originally Iranian. � e United Arab Emirates has long been a haven for Iranian businessmen, who have established an Iranian hospital, busi-ness council and club for Iranian families living in Dubai.

Even Saudi and Iran’s longstand-ing rivalry appeared to be cooling in the 1990s, as joint opposition to Saddam Hussein’s invasion of Kuwait helped Riyadh and Tehran restore ties in 1991. � e two gov-ernments exchanged high-level visits in the late 1990s and ties im-proved further until a political crisis in Yemen saw them backing opposite sides of the con� ict in 2000, with Saudi Arabia intervening militarily nine years later and again in 2015.

A handful of Iranian chefs were able to live and work in Saudi Arabia during the 1990s and early 2000s. Today, that would be unthink-able, said the general manager of Shayah restaurants, Mohammed Farhat—for a start, they wouldn’t be granted work visas. He said the last of Shayah’s Iranian employees left Saudi Arabia � ve years ago.

Saudi Arabia and Iran are now locked in proxy wars for regional

supremacy, backing opposite sides of the wars in Syria and Yemen and supporting political rivals in Leba-non, Bahrain and Iraq. � e con-� icts have deepened Sunni-Shiite enmity between hard-liners on both sides.

Relations hit a new low in Janu-ary, when Saudi Arabia executed a prominent Saudi Shiite cleric. Iranians protested and ransacked the Saudi Embassy in Tehran and its consulate in another part of the country. Diplomatic and trade ties between the two were severed and Saudi Arabia halted all commercial � ights to and from Iran.

According to Iran’s Ministry of Industry and Trade, Iranian exports to Riyadh for the � rst half of 2015 stood at $132 million, and Saudi im-ports accounted for $40 million.

Well before ties were o� cially cut, an Arabic Twitter account, named “Boycotting Iranian Goods,” was telling its more than 23,000 follow-ers that it is a religious and national duty to do so. Dozens of tweets were sent outing Iranian products in Sau-di grocery stores, including photos of ice cream, rose water, golden apples, sa� ron, honey and a � zzy pome-granate drink.

Shayah also became the target of zealous tweets, with some demand-ing that it remove the word “Iranian” from its signs and menu.

“We don’t want anything opened in the kingdom of Saudi Arabia with the name of the devil ‘Iran’,” said one tweet.

“� eir kebab is good, but I suggest

they remove the word ‘Iranian’ and continue on,” said another.

Even so, it appears a Saudi boy-cott of Iranian lamb skewers and sa� ron-infused rice is o� the table for now.

At a bustling food court in Riyadh’s Kingdom Center mall, American fast food dominates. Nestled among Sbarro’s pizzeria, a Krispy Kreme doughnut stand and a KFC in one of Shayah’s branches, where a steady stream of custom-ers, among them 26-year-old Haj-jar Mohammed and her friend Rawan Fahd, ordered sandwiches.

“If the government isn’t barring it, why should we?” said Fahd, who thinks the restaurant should keep its “House of Iranian Cuisine” strapline. Mohammed jumped in to add that many items on the menu are Mid-dle Eastern dishes anyway, and not just Iranian.

Several fans of the restaurant have come to its defense on Twit-ter, with one simply writing “Please, keep food out of this!”

For customers who might have doubts, a framed letter was put up in all of Shayah’s branches several months ago stating the chain’s Saudi ownership and � nancing.

Like many Saudis, customer Mo-hammed al-Tamimi, 30, vehement-ly disagrees with Iran’s policies in the region, but says he has no prob-lem with the people of Iran.

“It’s not a problem of culture, but a problem of politics,” he said, as he stepped out of Shayah carry-ing warm Iranian food to go. AP

Business as usual for Iranian restaurants in Saudi Arabia

PYONGYANG, North Korea—North Korea pre-sented a detained American student before the media on Monday in Pyongyang, where he tear-

fully apologized for attempting to steal a political ban-ner—at the behest, he said, of a member of a church back home who wanted it as a “trophy”—from a sta� -only section of the hotel where he had been staying.

North Korea announced in late January it had arrest-ed Otto Warmbier, a 21-year-old University of Virginia undergraduate student. It said that after entering the country as a tourist he committed an anti-state crime with “the tacit connivance of the US government and under its manipulation.”

No details of what kind of charges or punishment Warmbier faces were immediately released.

According to Warmbier’s statement on Monday, he wanted the banner with a political slogan on it as a trophy for the church member, who was the mother of a friend. In previous cases, people who have been de-tained in North Korea and given a public confession of-ten recant those admissions after their release.

He was arrested while visiting the country with Young Pioneer Tours, an agency specializing in travel to the North, which is strongly discouraged by the US State Department. He had been staying at the Yanggakdo In-ternational Hotel, which is on an island in a river that runs through Pyongyang.

It is common for sections of tourist hotels to be reserved for North Korean sta� and o� -limits to for-eigners. Warmbier is a native of Ohio and Ohio Gov. John Kasich, while campaigning in New Hampshire as a Republican presidential candidate, called the ar-rest “inexcusable.” Kasich has urged President Barack Obama to “make every e� ort to secure Mr. Warm-bier’s immediate release and keep [his] family con-stantly apprised.”

Kasich said North Korea should either provide evidence of the alleged anti-state activities or release Warmbier.

In his comments, Warmbier said he was o� ered a used car worth $10,000 by a member of the church. He said the church member told him the slogan would be hung on its wall as a trophy. He also said he was told that if he was detained and not returned, $200,000 would be paid to his mother in a way of charitable donations.

Calls to the Friendship United Methodist Church went unanswered on Monday.

Warmbier named that as the church his acquain-tance belonged to and there is a church of that name in his hometown, Wyoming, Ohio.

He said he was also encouraged in his act by the “Z Society” at the University of Virginia, which he said he was trying to join. � e magazine of the university’s alumni association describes the Z Society as a “semi-secret ring society” that was founded in 1892 and conducts philanthropy, puts on honorary dinners and grants academic awards.

Warmbier said he accepted the o� er of money because his family is “su� ering from very severe � nancial di� culties.”

“I started to consider this as my only golden opportu-nity to earn money,” he said, adding that if he ever men-tioned the involvement of the church, “no payments would come.”

North Korea regularly accuses Washington and Seoul of sending spies to overthrow its government to enable the US-backed South Korean government to control the Korean Peninsula.

US tourism to North Korea is legal and virtually all Americans who make the journey return home without incident. Even so, the State Department has repeatedly warned against travel to the North. Visitors, especially those from America, who break the country’s sometimes murky rules risk detention, arrest and possible jail sentences.

Young Pioneer describes itself on its web site as pro-

viding “budget tours to destinations your mother would rather you stayed away from.”

� e agency, based in China, also has tours to Iran, Cuba, Turkmenistan, Iraq and other former Soviet countries.

After Warmbier’s detention, it stressed in a news re-lease that he was the � rst of the 7,000 people it has taken to North Korea over the past eight years to face arrest.

“Despite what you may hear, North Korea is prob-ably one of the safest places on Earth to visit,” it says on its web site. “We have never felt suspicious or threatened at any time. In fact, North Koreans are super friendly and accommodating, if you let them into your world. Even during tense political moments tourism to the DPRK is never a� ected.”

In the past, North Korea has held out until senior US of-� cials or statesmen came to personally bail out detainees,

all the way up to former President Bill Clinton, whose visit in 2009 secured the freedom of American journal-ists Euna Lee and Laura Ling. Both had crossed North Korea’s border from China illegally.

It took a visit in November 2014 by US spy chief James Clapper to bring home Matthew Miller, who had ripped up his visa when entering the country, and Ko-rean-American missionary Kenneth Bae, who had been incarcerated since November 2012.

Je� rey Fowle, another US tourist from Ohio de-tained for six months at about the same time as Miller, was released just before that and sent home on a US gov-ernment plane.

He left a Bible in a local club hoping a North Korean would � nd it, which is considered a criminal o� ense in North Korea. AP

NORTH KOREA GIVES MEDIA A LOOK AT DETAINED AMERICAN

BAYONNE, New Jersey—A cruise ship that was battered by a major Atlantic storm earlier this month was headed

back to its home port on Sunday as another squall threatened its current voyage.

Royal Caribbean tweeted on Saturday that the Anthem of the Seas ship would re-turn to the port of Bayonne, New Jersey.

“The decision to return home was based on avoiding forecasted gale warn-ing weather conditions along our original itinerary and our desire to ensure the safety and comfort of our guests and crew,” Cyn-thia Martinez, a spokesman for the Miami-based cruise line, said in a statement on Sunday.

John Turell, an executive with The As-sociated Press (AP) who is aboard the ship with his wife, said in an e-mail that the ship’s captain and its cruise director made announcements saying some people were su� ering from norovirus.

“Sanitation levels on the ship have been boosted,” said Turell, the AP’s region-al television executive for the Northeast. “[Ship] workers are scurrying around like ants, scrubbing down handrails, tables and any other surfaces that can be washed.”

He noted that life aboard the ship “ap-pears quite normal” other than the very vis-ible increased sanitation e� orts.

Martinez said “a small percentage of our guests have experienced gastrointesti-nal illness thought to be norovirus,” about nine to 10 cases per day out of more than 6,000 people aboard. “Those a� ected by the short-lived illness are responding well to over-the-counter medicine,” she said.

Turell said passengers were told on Saturday night that the cruise was being cut two days short because of a storm developing o� Cape Hatteras. As a re-sult, planned stops in Barbados and Saint Kitts were being skipped and the ship was expected to arrive at its home port on Wednesday morning. AP

Cruise ship that was damaged in storm turns around again

RIYADH, Saudi Arabia—Iran and Saudi Arabia’s rivalry has played out in

proxy wars across the region, and escalated further after the two severed diplomatic and trade ties last month. Yet, in the Saudi capital, Riyadh, popular Iranian restaurants are outselling feverish calls for a boycott and stand as a reminder of when ties between the two countries held promise.

AMERICAN student Otto Warmbier (center) arrives at the People’s Cultural House, as he is presented to reporters on February 29 in Pyongyang, North Korea. North Korea announced late last month that it had arrested the 21-year-old University of Virginia undergraduate student. AP/KIM KWANG HYON

The World BusinessMirror Editor: Lyn Resurreccion • Tuesday, March 1, 2016news@businessmirror.com.ph A9

BAGHDAD—In Iraq, the death toll from devastating back-to-back market bombings

carried out by the Islamic State (IS) group the previous day in eastern Baghdad climbed to 73 on Monday, offi cials said.

Several of the critically wounded died overnight while 112 people remain in hospital, two police o� -cials said. Also, at least � ve people were still missing after the blast that ripped through the crowded Mredi market in the Shiite district of Sadr City, followed by a suicide bombing amid the crowd that had quickly gathered at the site to help the victims.

� ree medical o� cials con� rmed

the latest death toll, which rose from the toll of 59 reported late Sunday. All o� cials spoke on condition of anonymity because they were not authorized to talk to the media.

Iraqi Prime Minister Haider al-Abadi called on security forces to exert further e� orts to prevent the terrorists from carrying out their crimes against innocent civilians.”

Al-Abadi, in a statement released late Sunday, said the attacks “will not

stop us...but they will increase the determination” of the army, secu-rity forces and paramilitary troops to dislodge the militants from areas under their control.

� e IS group, which controls key areas in northern and western Iraq, promptly claimed responsibility for Sunday’s blasts. � e militant Sunni Muslim group regularly targets government forces, civilians and especially Shiites, who the IS regards as heretics.

� e market bombings in Sadr City were the deadliest attack in a wave of explosions that targeted other com-mercial areas in and outside Bagh-dad on Sunday and brought the day’s overall death toll to 92.

Seven other civilians were killed in attacks elsewhere and in Bagh-dad’s western suburb of Abu Ghraib, security forces earlier on Sunday repelled an attack by IS militants that killed at least 12 members of the government and paramilitary troops and wounded 35 others. AP

Baghdad bombing death toll now at 73

SALT LAKE CITY—A 17-year-old boy who authorities say was wielding a metal stick was shot

and critically injured by Salt Lake City o� cers on Saturday night, touching o� unrest downtown as o� cers donned riot gear and blocked streets and by-standers threw rocks and bottles.

The teenager shot by two Salt Lake City Police o� cers was in critical condi-tion at a local hospital Sunday after be-ing struck twice in the torso, according to Detective Ken Hansen with the Uni� ed Police Department, which is investigat-ing the shooting.

Salt Lake City Police declined to iden-tify the boy on Sunday afternoon be-cause he is a minor.

In a statement, the department said two Salt Lake City o� cers were trying to break up a � ght around 8 p.m., where the teenager and another male were hitting a third male with metal objects.

The o� cers ordered the males to drop the metal, “stick-like objects” and one male complied. The teenager did not drop the stick and instead moved toward the victim in a threatening man-ner, Salt Lake City Police Detective Greg Wilking said. One or both of the police o� cers then shot the teen.

Police said earlier on Sunday that the teenager was shot when he tried to attack one of the o� cers. Wilking said on Sunday afternoon that investigators were still trying to determine if that was the case. He said they had not yet inter-viewed the o� cers involved.

Wilking did not have details about how far away the teenager was from the o� cers or the victim when police shot him.

He also did not have details about how long the sticks were or where the males got the metal. Police said earlier on Sunday that the boy had been wielding a broomstick.

Police did not release the identities of the other two males involved, or wheth-er they were also minors. The male who was hit with the sticks did not require medical attention, Wilking said. He did not know what happened to the other male who had been wielding a stick, or whether investigators spoke with him.

Neither o� cer involved in the shoot-ing was injured, Wilking said. Police are not releasing the identity of the o� -cers but said on Sunday that both were placed administrative leave while the incident is investigated.

The o� cers were both wearing body cameras but police said on Sunday they will not release the footage because of the ongoing investigation and the pos-sibility that the teenager depicted could face charges.

Police did not have details about what prompted the � ght in the street, which was near a downtown homeless shelter, shop-ping mall and movie theater.

Bystander Selam Mohammad told The Salt Lake Tribune and Deseret News

that he was friends with the teenager and said the boy was shot as he turned to face police.

“He barely even turned around, then boom, boom, boom—and he just dropped,” Mohammad told the Deseret News.

When asked about that account, Hansen said he did not have details to con� rm or deny that information.

After the shooting, bystanders began yelling obscenities and throwing rocks and bottles at police, who called in about 100 o� cers to help.

Police, including o� cers wearing helmets and carrying riot shields, bar-ricaded four surrounding city blocks. A light-rail stop in the neighborhood was closed. Hansen said the bystanders throwing rocks and bottles were people hanging out near the shelter. He didn’t know if they were homeless, but he said they were not customers of the nearby shopping center. Hansen said the area was relatively busy, with people visiting the shopping center and restaurants and others hanging out near the shelter and homeless facilities.

“There were pockets of that distur-bance for hours,” Hansen said on Sunday.

Wilking said police asked bystanders to leave the area and put up barricades and tape to clear streets. He said by-standers were throwing objects at police for only about 10 minutes. He added that police asked people to leave but did not physically move anyone, form a riot line or spray anything, such as tear gas, to dis-perse the crowd.

“It’s kind of making more of a pres-ence with your body,” he said of the tac-tic used to clear the streets.

Four people were arrested for civil disorder, Salt Lake City police said.

Salt Lake City Mayor Jackie Biskupski said in a statement on Sunday that she was saddened and that the shooting was a tragedy for everyone involved. AP

Salt Lake City police shoot teen, face rock throwers

PEOPLE gather at the scene of deadly bombing attacks in Sadr City, Baghdad, Iraq, on Sunday. Militants attacked Mredi outdoor market on Sunday in eastern Baghdad, killing at least 24 people and wounding dozens, o� cials said. AP

POLICE arrest a man in an angry crowd that formed after an o� cer-involved shooting at 200 South Rio Grande Street in Salt Lake City on Saturday. LENNIE MAHLER/THE SALT LAKE TRIBUNE VIA AP

WOODBRIDGE, Virginia—On her � rst day on the job, O� cer Ash-ley Guindon responded to a call

that could have become routine: a domes-tic disturbance in a well-kept suburban neighborhood.

But one woman had already been slain inside the northern Virginia home of a Pentagon worker and O� cer Guindon would be next. Army Sgt. Ronald Hamilton opened � re as she arrived at his door, kill-ing her and wounding two other o� cers, police said on Sunday.

Prince William County Police Chief Stephan Hudson was stone-faced on Sunday as he lauded Guindon’s bravery, intelligence and compassion. The chief o� ered no details about what might have provoked the gunman, who worked at the Pentagon and, according to neighbors, was about to be transferred to Italy.

Hamilton, 32, and his wife Crystal, 29, had been arguing all day on Saturday, but it escalated after she called 911, the chief said. Hamilton fatally shot his wife and then � red at the arriving o� cers, killing Guindon and seriously wounding the oth-ers before emerging from his front door to surrender. O� cers recovered a handgun and a ri� e. The couple’s 11-year-old son was home at the time of the slayings and is being cared for by relatives, Hudson said.

Guindon, 28, was pronounced dead at the hospital where o� cers Jesse Hempen, 31, and David McKeown, 33, were being treated on Sunday. Police did not detail their injuries. Hudson said they face long recoveries.

Commonwealth’s Attorney Paul Ebert said he would likely seek the death penalty against Hamilton, who was held without bond on charges including capital mur-

der, � rst-degree murder and malicious wounding pending a Monday morning arraignment. Guindon, a former Marine Corps reservist with a master’s degree in forensic science, had been sworn in on Fri-day, which the department marked with a celebratory tweet.

“We were struck by her passion to do this job,” Hudson said. “She couldn’t get it out of her blood. She clearly had a pas-sion to serve others in a way that went beyond herself.”

Guindon’s death was not the � rst trag-edy to strike her family. Her father, David, killed himself the day after he returned home from Iraq, where he served with the New Hampshire Air National Guard. “He came home and took his own life,” Doro-thy Guindon, Ashley’s grandmother, told the Associated Press. He was buried with full military honors on August 26, 2004. AP

Slain Virginia off icer lauded for bravery, intelligence

Tuesday, March 1, 2016 • Editor: Angel R. Calso

OpinionBusinessMirrorA10

Government’s lack of urgency

editorial

AMERICAN economist Milton Freidman once said, “If you put the government in charge of the Sahara Desert, in five years there’d be a shortage of sand.” This was his way of describing the

often ineffective and incompetent government.

However, government inaction can be just as bad as, if not worse than, its failure to perform well. In the private sector, from the individual to the largest corporation, there is the sense that we cannot afford to put off until tomorrow that which can be accomplished today. But in gov-ernment, it is too often just the opposite, where unnecessary delays are the standard operating procedure.

We have seen it with vital projects that have been studied, literally, to death. Proposals are revised and revised, until the basic assumptions of why the plan was first proposed have become obsolete. Once upon a time, the government had a proposal to ensure that every barangay in the nation was equipped with at least one landline. But by the time the project came to fruition and before completion, the cell phone had replaced wired communications.

The Manila Electric Co. (Meralco) is now complaining that the Energy Regulatory Commission (ERC) has failed to approve its plan for its P17.7- billion capital expenditure (capex) program for 27 projects scheduled in 2016. While it is the job and mandate of the ERC to review Meralco’s proposal, the original request for approval was filed in February 2015.

Earlier last month ERC Chairman Jose Vicente B. Salazar said hear-ings for Meralco’s capex application are still ongoing. What was not said is why the process needs to take one year.

Is it any wonder, then, why we have power shortages, a public-trans-portation system that is in chaos and we cannot write tax laws that make sense for the 21st century? There is no sense of urgency to get the job accomplished as quickly as possible with a proper amount of com-petency. Is there any sense of meeting a deadline in the government?

 Understanding the seriousness of the problem, Meralco will use its emergency capex fund, amounting to about P10 billion, to complete the necessary projects in meeting load and customer growth. Meanwhile, the government sits on its hands.

Government officials and politicians always seem amazed at why the public is distrustful of the government and unhappy with the per-formance. Yet, they themselves would not tolerate a similar attitude in their own dealings with the private sector, being constantly told “Out of stock” or “Come back tomorrow.”

The public has a right to expect more from the government that it pays for. In the outside world, there are choices and completion for a person’s business. Government is a monopoly and government officials act like they know we have no alternative.

Don’t push the panic button, yet

Continued from A1

For Saudi Arabia, which is run by a family, reducing oil production is not only an economic issue. One reason for its opposition to an output cut that such a belt-tightening measure could trigger political unrest when the country has a feud with Iran.

Also, it is not easy for the Saudis and its allies to tighten belt because Iran has resumed oil exports after being freed from a trade embargo.

Aside from the Middle East issue, there are other factors that will sup-port the continuing increase in re-mittances, which is one of the main drivers for the Philippine economy.

For instance, an added comfort as far as inflow of remittances is con-cerned, is the improving US economy, which has been recovering from its financial crisis in 2008.

Based on an advance estimate released by the US Bureau of Eco-nomic Analysis, real GDP increased by 2.4 percent in 2015, the same rate posted in 2014.

The International Monetary Fund’s forecast as of January is higher at 2.6 percent. This is good for the Philippines because a large part of remittances comes from the US.

World oil prices plunged to his-torical lows in 2015 (and until this year), but remittances continued to increase. In fact, cash remit-tances from overseas Filipino workers reached a record-high of $2.5 billion in December 2015, up by 4.6 percent year-on-year, according to the Bangko Sentral ng Pilipinas (BSP).

Cash remittances for the whole of 2015 totaled $25.8 billion, up from $24.6 billion posted in 2014.

The 4.6-percent annual increase exceeded the 4-percent growth fore-cast of the BSP. The US is the largest source of remittances for the Philip-pines. According to the BSP, the US accounted for $10.37 billion of remit-tances in 2014, or 42 percent of total remittances during that year. Remit-tances from Saudi Arabia amounted to $2.52 billion, or 10 percent of the total amount.

In the first 11 months of 2015, Filipinos from the US sent home $9.13 billion, or 40 percent of the total remittances of $22.83 billion

for the 11-month period. Saudi Arabia accounted for $2.4 billion, or 10.5 percent.

Japan-based Nomura allayed con-cerns over the impact of lower oil prices on remittances. In a published note, titled “Asia Special Report-Philippines: Challenging portfolio flows…but resilient remittances,” Nomura said remittances were likely to remain strong.

Nomura cited a number of fac-tors that mitigate the risks to re-mittances. These include the geo-graphical diversification of remit-tance sources, an increased contri-bution from more skilled workers in high-demand service industries and higher per-capita remittances, which reflect an increasing number of higher-income employees.

The BSP also remains optimistic that remittances will increase by 4 percent in 2016. A BSP official said, in a worst-case scenario, growth will be flat, but will not contract.

Bottom line: We’re good. It’s wise to make preparations for contingen-cies, but there’s no reason to panic.

For comments, e-mail mbv.secretariat@gmail.com or visit www.mannyvillar.com.ph.

THE ENTREPRENEURManny B. Villar

BACK in the good old days, putting food on the table was a much harder proposition. Not only did you have to hunt the rabbit, but you had to continuously watch your back to make

sure the tiger did not steal your prey or, at worst, kill you.

Politics is only economics and security

OUTSIDE THE BOXJohn Mangun

So we came together in society, and as you hunted, another person watched your back. The second per-son had two jobs: not to scare din-ner away and give protection. In the modern age, the second person has been replaced by government.

People expect government to do that job and that is what they con-sider when they vote. It all comes down to personal economics and the security necessary to protect what we have earned. Unfortunately, govern-ments around the world have failed to perform those two tasks.

Governments keep “scaring” away the food sources through overtaxa-tion and over or under regulation, and cannot provide the security to keep the people’s wealth from being

stolen, one way or another.Peggy Noonan is an American

author and was speech writer for US President Ronald Reagan. In a recent column, she summarized the current situation that is upending the politi-cal scene around the world.

She characterizes the problem as a conflict between the “protected” of the political and economic elite and the “unprotected” common citizens. She writes in the Wall Street Journal: “The protected make public policy. The unprotected live in it. The unprotected are starting to push back, powerfully.”

Of the protected, “They live in nice neighborhoods, safe ones. Their kids go to good schools, they’ve got some money.” Their lives are the

opposite of what the unprotected experience every day. “But the unpro-tected watched and saw. They real-ized the protected were not looking out for them” as they were supposed to do, as the ones who hold the power of government.

“This is a terrible feature of our age—that we are governed by pro-tected people who don’t seem to care that much about their unprotected fellow citizens.” Noonan is writing of the US and Europe, but her ideas are just as true here in the Philippines and elsewhere. Most leaders do not have a clue what the ordinary person lives through.

This is all part of the political changes that I have been talking about for some time that will come

to a head in 2017. We might mark a significant start in Indonesia, where Joko Widodo was elected as the first president not from the military.

Britain wil l vote on  June 23rd whether to leave the Europe-an Union, a product of the protected class. The US could easily elect as president a man who has never run for elected office. Even here in the Philippines—love him or hate him —Rodrigo Duterte has the potential to be president. Note that Mayor Duterte would be the first president that did not previously hold national office as a senator, vice president or, at the least as Ramon Magsaysay, a cabinet secretary.

Noonan continues, “In wise gov-ernments, the top is attentive to the realities of the lives of normal people and careful about their anxieties.” This is the key even in the Philip-pines: “I don’t know if the protected see how serious this moment is or their role in it.” Here, they will learn on the May 10.

E-mail me at mangun@gmail.com. Visit my web site at www.mangunonmarkets.com. Follow me on Twitter @mangunonmarkets. PSE stock-market information and technical analysis tools provided by the COL Financial Group Inc.

Nomura cited a number of factors that mitigate the risks to remittances. These include the geographical diversification of remittance sources, an increased contribution from more skilled workers in high-demand service industries and higher per-capita remittances, which reflect an increasing number of higher-income employees.

People expect government to protect them and that is what they consider when they vote. It all comes down to personal economics and the security necessary to protect what we have earned. Unfortunately, governments around the world have failed to perform those tasks.

Tuesday, March 1, 2016

OpinionA11BusinessMirroropinion@businessmirror.com.ph

THIS week I will inaugurate the 50.07-megawatt (MW) Tarlac Solar Power Plant (TSPP) at the Central Techno Park in Tarlac City—a project of the PetroSolar Corp., a joint venture

between PetroGreen Energy Corp. and the EEI Power Corp.

Renewable energy

To date, the TSPP is the country’s largest single solar-power facility.  It was built fast, considering that the supply and construction contracts were signed only in mid-June 2015 and by late January this year the plant is already feeding electricity to the Luzon grid.

This is the kind of green proj-ect envisioned in the Renewable Energy Act (Republic Act 9513) that I wrote and pushed for nearly 10 years ago—which also helps fulfill the commitment we made in Paris during 21st Confer-ence of Paris (COP21) to reduce carbon emissions by 70 percent come 2030. 

TSPP’s inauguration demon-strates how the country is adding more renewables into its power- generation mix. In fact, as of De-cember 2015, the Department of Energy (DOE) is processing more than 4,000 MW of proposed solar projects alone, around 144 MW of which is already considered installed capacity. 

However, recent DOE data also shows that of the 5,000 MW of pow-er projected to go online within the next five years, over 70 percent will be coal-based. Only 534.4 MW—or a little over 10 percent—of this new power will come from renewables. 

In contrast, some of our neigh-

bors have acted decisively in the global transitioning to cleaner en-ergy technologies. In 2015 Thai-land connected to their national grid almost 1,500 MW of solar capacity alone.  China has become the world leader in rolling out solar- and wind-power technolo-gies to counter its status as the world’s top carbon emitter.    

In the Philippines the debate isn’t so much on whether we need more renewable-energy (RE) technolo-gies, but on how aggressively they should be deployed.  Often, the main argument against is that given the current state of technology, RE is still expensive and intermittent.

However, a recent Lazard group study calculated that between 2009 and 2014, the costs of solar photo-voltaic energy and land-based wind power dropped by 80 percent and 60 percent, respectively, and are projected to continue doing so in the coming years.   

Breakthroughs are improving battery technologies and leading to innovations, such as the Pow-erwalls Elon Musk’s Tesla started piloting last year—ultimately re-ducing the intermittency problem of renewables.

Where the Breakthrough Energy Coalition of Bill Gates and 23 other billionaires pledged in Paris during COP21 to channel billions of dollars to support clean-energy start-up companies, adopting a “wait-and-see” approach merely puts us at the back of the pack.

The Philippines could become a leading RE player in the region. Clearly, much work still needs to be done.  But it is equally clear that much more can be accomplished if more government support is given for renewables.

E-mail: angara.ed@gmail.com.

IT seemed that the bright people from the Office of the Presidential Adviser on the Peace Process (Opapp) have not really run out of treasonous ideas.

ABOUT TOWNErnesto M. Hilario

Edgardo J. Angara

They have not run out of treasonous ideas

  This time, after losing the Bangsamoro basic law in Congress and its original act (memorandum of agreement on Ancestral Domain) in the Supreme Court, Presidential Adviser on the Peace Process Teresi-ta Quintos-Deles and government Peace Panel Chairman Miriam Coronel-Ferrer have introduced a new idea: transform Moro Islamic Liberation Front (MILF) camps into economic zones.

They recently introduced the new idea in Kuala Lumpur with the so-called third party, headed by Malaysia, purportedly to con-tinue peace negotiations with the MILF and discuss the transforma-tion of MILF camps into economic zones without prior congressional approval.

We should commend and sup-port the Philippine Ambassadors Foundation Inc. (Pafi) and the Philippine Council for Foreign Re-lations, Inc. (PCFR) on their timely reaction to this:

“Given the findings of the Philippine legislature that the Comprehensive Agreement on the Bangsamoro [CAB] and its imple-menting legislation have serious constitutional infirmities, it ap-pears that the insistence of the Oppap to give the MILF that sta-tus of belligerency and making the peace process exclusive and presenting the group to the in-ternational partners is the height of imprudence, if not a complete defiance of the will of Congress, which represents the people of this nation for a more inclusive peace process that involves other stakeholders in Mindanao.

“This initiative taken by the Opapp without consultation with Congress and stakeholders in Min-danao, like the Sultanate of Sulu, the Christians and lumads that may be affected by the apparent arbitrary claims by the MILF to territories in Mindanao to be con-verted into economic zones, is sure to invite a renewal of hostilities in the area.

“The very act of the Oppap to internationalize a domestic issue involving local autonomy is play-ing into the hands of interested parties abroad, such as Malaysia, against which this country has territorial claims and cannot, therefore, be considered as an honest broker.

“This is also in defiance of the Tripoli agreement, which is still a work in progress as claimed by the

MNLF [Moro National Liberation Front]. Indeed, the attempt of for-eign parties to micromanage the peace process in Mindanao, with the encouragement of our own Philippine panel, might even be considered seditious, as it appears to be aiding and abetting the op-posite party which has claimed to be in a state of war with this na-tion as implied by the wordings of the CAB.

“The tacit approval by this ad-ministration of developments in Kuala Lumpur requires the imme-diate attention of stakeholders in Mindanao, because this, in effect, allows the takeover by the MILF of chunks of Philippine territory pur-portedly belonging to the MILF to be converted into economic zones.

“The Pafi/PCFR considers this development to become even more contentious than the Edca [Enhanced Defense Cooperation Agreement] and the West Phil-ippine Sea [South China Sea] is-sue aggravated by the apparent endorsement of this administra-tion without consultations with Congress and the stakeholders in Mindanao.

“The bright girls of the Opapp have again dealt with foreign agents to pursue their pet project of continuing to please the MILF. They don’t seem to know—or are deliberately ignoring this fact that the leaders of this rebel group were largely responsible for the massa-cre of the PNP-SAF [Philippine Na-tional Police-Special Action Force] 44, and have dishonored and in-sulted the Philippine government and the Filipino people by arro-gantly refusing to make a deter-mined effort to gather and return the arms and personal belongings of the massacre victims from the MILF and BIFF [Bangsamoro Is-lamic Freedom Fighters] warriors who took them.

“The Opapp people obviously don’t share the opinion of our Supreme Court justices and our senators who have declared the Comprehensive Agreement on the Bangsamoro unconstitutional.

“We are appalled by the con-tinuing betrayal of the interests of the Philippine Republic by Presi-dent Aquino’s Opapp officials.

“He and they must be held to account for this and other trea-sonous acts.”

To reach the writer, e-mail cecilio.arillo@gmail.com.

Can a teacher aspire for the presidency?

DOES a teacher have the capability to lead the country? The Alliance of Concerned Teachers (ACT) thinks so.The organization is said to be up in arms against Vice

President Jejomar C. Binay for allegedly belittling the capabili-ties of teachers to lead the country during a campaign sortie in Cavite recently.

DATABASECecilio T. Arillo

Trump’s promises don’t pass musterB A R. H

Bloomberg View

A POWERFUL force driving Don-ald Trump and Bernie Sand-ers in the presidential race is

the frustration of grassroots voters that politicians in Washington haven’t kept their promises.

Democrats, though still high on President Barack Obama, are upset about an economic recovery that bene-fited Wall Street more than Main Street, top executives more than workers.

The anger is more palpable among Republican voters, who ushered in big congressional majorities for the party, expecting to end Obamacare, reduce the size of the government, cut taxes and bolster national security. None of it happened.

With that track record of  broken promises and with Trump emerging as the likely Republican presidential nomi-nee, it’s good to look at his prominent

promises and the critiques:National security:  Trump has

pledged to be tough, to defeat the Is-lamic State (IS) by bombing oil fields, which he would then turn over to US oil companies. He would force Arabs to do the fighting against the IS. He says he would “get along very well” with the Russian strongman Vladimir Putin, whom he has praised as a strong leader. He gets his foreign-policy ad-vice from watching television news programs, he says. 

This doesn’t impress many foreign policy experts. “He has said very little of substance,” says former Sen. Richard Lugar, an Indiana Republican who was chairman of the Foreign Relations Com-mittee. “It appears he doesn’t have a real grasp of the range of complex issues or hasn’t done his homework,” adds Leon Panetta, who served as defense secre-tary and Central Intelligence Agency director in the Obama administration: “It’s the sort of stuff you expect to hear

at the bar at the country club.”Mass deportations:  Trump pro-

poses removing 11 million undocu-mented immigrants within two years. He poses the challenge in simple terms: “They say you have to go through a huge legal process. You don’t. They are illegal.”

The  American Action Forum, a right-of-center research organization run by Douglas Holtz-Eakin, a promi-nent Republican economist, will soon release a study on the economic im-pact of Trump’s plan: The number of personnel devoted to apprehensions would soar to 90,582 from 4,844; the number of attorneys and courts would increase twentyfold; the num-ber of detention beds would have to increase tenfold and almost 100,000 chartered buses and flights would be required. American Action estimates that the cost to the economy would be $1 trillion.

The nonpartisan Pew Research Cen-ter  calculates that the deportations

would cause big job losses in sectors of the economy: 26 percent of farm-ing, fishing and forestry workers; 17 percent of building maintenance and cleaning personnel; and 14 percent of construction workers. The liberal Cen-ter for American Progress says studies show that many of these jobs would go unfilled, devastating the economy.

The border wall: Trump vows to build a wall along the Mexican border that would cost about $8 billion and that would be paid for by Mexico. Experts ridicule that possibility. “The Mexicans treat this with total disdain,” Alex Nowrasteh of the libertarian Cato Institute says. “I don’t know any policy people that take this seriously.”

Trade: Trump would impose tariffs on some goods from Mexico and huge penalties on imports from China, from 25 percent to 45 percent. These coun-tries are cheating America on trade, he charges.

But trade specialists note that he

couldn’t do this unilaterally. “No pres-ident in our lifetime has ever contem-plated anything like this, but I believe Congress would have to act,” says Susan Schwab, who was US trade representa-tive under President George W. Bush. Moreover, she says this would be in violation of international trade rules, and Mexico and China would respond by going to the World Trade Organization, where they would win a judgment. Or they could retaliate against US goods, such as agricultural products, which would “inflict great damage.”

Taxes:  Trump  proposes  a huge across-the-board tax cut that he says would make the US more competitive, take 75 million people off the tax rolls and create more equity. It would pay for itself by eliminating some deductions and credits.

Expert analysis shows that it would indeed take tens of millions off the tax rolls. But little else holds up. Both the left-of-center Tax Policy Center and the

right-of-center  Tax Foundation  agree that the Trump plan doesn’t come close to paying for itself, and would cost more than $9 trillion in revenue over the first decade. Both concur that it’s heavily skewed in favor of the wealthi-est taxpayers.

Even Trump’s promise to crack down on hedge-fund and private-equity executives who benefit from a lower tax rate on capital gains, instead of the top ordinary income rate on car-ried interest, doesn’t hold up. Many of these arrangements are partnerships, and Trump’s plan also calls for the top corporate rate to drop to 15 percent, a little lower than the top capital-gains rate.

To date,  Trump  has been immune from substantive criticism, and he may have answers to these complaints, though he has been questioned pas-sively. His Republican rivals began to grill him on issues such as health care; that should be just the start.

Binay was reported to have said during a recent campaign sortie in Cavite that “the issue now is com-petence for the position.” Benjamin Valbuena, ACT na-tional chairman, said Binay was clearly referring to Grace Poe, who once worked as a preschool teach-er in the United States, implying that Poe could not be trusted to lead the country because “she is a mere teacher.”  For Valbuena, Binay’s statement shows how little the vice presi-dent regards teachers despite all the sacrifices and diligent service the teachers have rendered to the country’s youth. He said Binay’s parents them-selves were teachers, and the vice president’s statement clearly re-flects his insensitivity. “In fact, teachers are considered by a majority of our people as mod-ern-day heroes for their sacrifices,” he added. “As if the meager pay and heavy workload of teachers are not enough, now we have the vice president say-ing we are worth nothing,” Valbuena said, referring to Binay’s pronounce-

ment apparently questioning the leadership capabilities of Sen. Poe, his rival in the May 2016 presiden-tial elections. “We would like to emphasize that it was us, teachers, who have diligently guarded, counted and canvassed the votes cast for him and all other politicians,” he said.

“We urge all candidates to fo-cus on discussing their platform on how to address the concerns of overworked and underpaid teach-ers,” Valbuena said. He raises a valid point that I think should be borne in mind by the elec-torate when they choose the next set of leaders in the May elections.

Where there’s smoke, there’s fireA GROUP of lawyers has gone to court to stop what they allege is a P120-million overprice in the ac-quisition of heavy equipment by the Butuan City government.

They expressed serious doubts over the legitimacy of the bid-ding process, claiming there was connivance between the city and the winning bidder, Conequip Philippines Inc.

In their petition for a tempo-rary restraining order or writ of preliminary injunction against the project, lawyers Clint Dabalos, Dennis Bacala, Araceli Luyahan-Orcilla, Vincent Jose Fortun and Dendo Ugarde said the approved budget of the contracts (ABC) and the bid amounts submitted by the winning bidder were “strikingly similar, if not identical figures.”  

The lawyers cited the similar ABC (P25,845,798) and the bid amount (P25,845,798) of Conequip Philippines for the purchase of four 10-wheeler dump trucks. The ABC and bid price of Conequip for the purchase of vibratory compactor were also the same.

The petition was raffled off to the sala of Judge Augustus Calo of Branch 5 of the Regional Trial Court in Agusan del Norte and Bu-tuan City. It was docketed as Civil Case 7263.

The respondents are Mayor Fer-dinand Amante, members of the Bids and Awards Committee, and the private contractor Conequip Philippines Inc. The lawyers con-cluded that the project was over-priced by comparing the prices of branded heavy equipment compared with those procured by Conequip from a supplier in China said to offer the cheapest prices for such equipment.

The lawyers said Conequip’s brand-new crawler-type excava-tor costs P17,649,390, while Cat-erpillar, a well-known brand, only amounts to P6,200,000.  Conequip sold four 10-wheeler dump trucks for a total amount of P25,845,798, or P6,461,449.50 each, more expensive than the Hino brand, which costs only P4,400,000.

  T he re ’s mo re : p ne u m at -ic pavement breaker: Conequip (P1,591,455), Volvo (P850,000); vibratory compactor: Conequip (P6,067,200), Volvo (P3,200,000); 10-wheeler tractor head: Conequip (P6,209,400), Volvo UD-Quester (P5 million). Garbage compac-tor: Conequip (P8,233,380), Dong Feng (P2,200, 000); six-wheeler garbage compactor truck: Conequip (P5,599,978), Dong Feng (P2,200,000); transit mix-er: Conequip (P3,999,991,20), Hino (P2,691,000); and vacu-um and jetting truck: Conequip (P10,999,975.80), North Benz (P3,164,000). The comparison of prices is tell-ing and leaves no doubt that tax-payers will bear the brunt of this clear overprice. Taiwan on gruesome killing GOT this e-mail last week from the Taipei Economic and Cultural Office in the Philippines:

“We are deeply shocked and sad-dened by the recent killing of Mrs. Rowena Kuo and the subsequent mutilation of her body.

“The ruthless homicide is ab-horrent to this office and the Tai-wanese people and actually seldom happens in Taiwan. Therefore, we wish to express our deepest condo-lences and sympathy to the next of kin of the victim at a time of grief and darkness.

“As the case has already been handed over to the appropriate Philippine judiciary authorities, we have full confidence that they will conduct a fair trial and render justice.”

E-mail: ernhil@yahoo.com.

TSPP’s inauguration demon-strates how the Philippines is adding more renewables into its power-generation mix. In fact, as of December 2015, the Department of Energy is processing more than 4,000 megawatts (MW) of proposed solar projects alone, around 144 MW of which is already considered installed capacity.

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B L S. M

THE continued decline in earnings due to the structural change in its revenue mix has

forced Philippine Long Distance Telephone Co. (PLDT) to cut its core income target by a fifth for 2016. 

MVP lowers PLDT’s 2016 earnings goal

Although PLDT achieved its P35-billion core net-income goal in 2015, Chairman Manuel V. Pangilinan still sees tougher years ahead, as the birth pains of the digital shift continue to hurt the company’s al-ready weak topline. 

“The entire organization, both structure and people, are being oriented to turn on this digital pivot. We expect it to be a long and difficult process, with many critical adjust-ments to be made along the way,” he said, “We certainly don’t expect results overnight; in fact, we esti-mate it will take three years before we make a complete turn. PLDT’s profitability will, therefore, have to be ‘reset’ to a lower baseline in 2016 —P28 billion in core earnings.”

Pangilinan said the factors that

will affect this year’s financial per-formance are the single-digit rev-enue growth due to the transition to data; the continued decline in margin due to structural change in revenue mix, where higher-margin legacy businesses such internation-al and national long distance and text are replaced; and the company’s

efforts to maintain a fair share of the market, which is a drag in the short term. The last time the company booked a net income within the P28-billion level was in 2004.

He added that competition “will remain intense; our working as-sumptions anticipate the entry of a third player; and, capital-expenditure levels will remain elevated, resulting in higher depre-ciation and financing costs with no special dividends.”

Last year saw the company’s bottom line plunging by 35 per-cent to P22.1 billion, from P34.1 billion the year prior, as a result of the dip in core net income, higher foreign exchange and derivative losses, and a rise in impairment charges relating to both fixed as-sets and investments. Core income, however, was at P35.2 billion, or about 6 percent lower than the P37.4 billion re-corded last year. This figure is a little over its P35-billion core net- income target for 2015.  The company’s consolidated rev-enues inched up by a percentage point to P171.1 billion, from P170.8 billion, as a result of its declining legacy businesses. Excluding rev-enues from the international and national long distance segments of

P19.7 billion, consolidated service revenues grew by 2 percent year-on-year, or from P140.3 billion to P143.2 billion at the end of 2015. 

Data revenues continued their strong growth, improving 16 per-cent to P48.5 billion in 2015. These two segments now account for about 30 percent of consolidated service revenues, with the goal of acceler-ating these revenues such that they make up more than 40 percent of consolidated service revenues in the next three years. 

Mobile Internet usage grew 106 percent to close to about 100,000 terabytes, while related revenues grew 26 percent to P10.4 billion. Smartphone penetration is now about 40 percent of the company’s cellular-subscriber base. “Data remains the key growth engine for the PLDT Group. Our Consumer and Enterprise Groups therefore need to focus their ef-forts on providing an excellent customer experience in this area. To achieve this, we need network dominance and reliability, ease of use and a superior portfolio of con-tent, applications and solutions,” Pangilinan said. 

PLDT Enterprise’s corporate data or other network services and data centers generated revenues of P11.1 billion, growing 14 percent

from 2014. Corporate data and other network services were higher by 12 percent at P9.2 billion, while data-center revenues jumped by 26 percent to P1.9 billion.  Fixed broadband revenues, on the other hand, grew by 15 percent, or P2.1 billion, to P16.1 billion, following the 14-percent jump in subscriber base. The fixed line subscriber base rose to 2.3 million at the end of 2015, 55 percent of whom have fixed broadband subscriptions. 

Total wireless-service revenues declined by 4 percent to P110.7 billion, from P115 billion the year prior. The group’s combined post-paid cellular-subscriber base grew by over 192,000 from the end of 2014, rising to 3 million at the end of the period, while the combined prepaid base stood at 62 million.  “Other efforts to enable and ac-celerate data adoption to drive us-age include the bundling of popu-lar apps and video platforms with various load and plan denomina-tions. The introduction of shared data plans, whereby fixed data plan subscribers can share up to 6GB of data to registered beneficiaries, is also expected to increase usage,” Pangilinan said. 

He noted t hat g iven t he huge capital requirement of the

digital shift, the telecommunica-tions company has programmed a P43.2-billion capital spending in 2016, a bit higher than the P43 bil-lion set last year.  “All that said, I can say that we are off to a good start—with en-couraging signs from sequential revenue trends and test results of network quality that are showing sustained improvements. We have a number of promising initiatives in digital platforms and mobile fi-nancial services, as well as signifi-cant strategic partnerships in the making,” Pangilinan said.

He added: “Yet, much needs to be done and much can be achieved with hard work, perseverance and focus. The digital world is vast, dy-namic and complex, but we’ve done it before and we can do it again.”

Hours after the company’s disclosure of its financial perfor-mance for 2015 on Monday, shares of PLDT dropped by 18 percent to P1,830 apiece.  The stock fell as much as 12 per-cent, the biggest intraday drop since 2008, after PLDT reported a net loss of P3.27 billion ($69 million) in the three months ended December 31. The company also forecast that profit, excluding one-time items, will fall 20 percent to P28 billion this year.

35%Drop in PLDT’s net income in 2015 to P22.1 billion

THE Asian Development Bank (ADB) has backed the issuance of the first climate

bond in Asia and the Pacific.The ADB will provide credit

enhancement to the Philippine firm AP Renewables Inc., a sub-sidiary of Aboitiz Power Corp. (AboitizPower), for the Tiwi-Mak-Ban geothermal energy facilities.

The P10.7-billion ($225-million equivalent) local currency bond comes in addition to a direct the ADB loan of P1.8 billion ($37.7 mil-lion equivalent). The ADB’s credit enhancement is in the form of a guarantee of 75 percent of principal and interest on the bond.

“The successful use of credit enhancement for Tiwi-MakBan

reflects our evolving strategy to make creative use of the ADB’s ex-panding balance sheet to support infrastructure investment in Asia and the Pacific,” said Todd Free-land, director general of the ADB’s Private Sector Operations Depart-ment. “Credit-enhanced project bonds offer an attractive alterna-tive to bank financing, and by mo-

bilizing cost-effective, long-term capital can help close the region’s infrastructure gap.” The climate bond, which has been certified by the Climate Bonds Initiative, is the first in Asia and the Pacific and the first-ever cli-mate bond for a single project in an emerging market. In 2015 the ADB committed to double its financ-ing for climate-change adaptation and mitigation by 2020, including playing a catalytic role to crowd-in private-sector climate finance.

“This is a landmark transac-tion for the Bank of the Philippine Islands [BPI], the Philippines and the Asia-Pacific region in terms of both capital markets development and climate finance,” said Reginaldo Cariaso, managing director of BPI Capital Corp., which acted as lead arranger and sole underwriter of the bond issuance. “The transaction is highly innovative, representing the first project bond ever issued in lo-cal currency in the power sector in the Philippines and the first credit-enhanced project bond in Southeast Asia (excluding Malaysia) since the 1997-1998 Asian financial crisis.” AboitizPower is a major power developer in the Philippines and an emerging leader in renewable energy in Southeast Asia. Since acquiring the Tiwi-MakBan com-plexes in 2009, AboitizPower has

invested in the rehabilitation of the facilities to improve performance and extend their operating life. With the refurbishment complete, the project is now undertaking its first-ever debt financing. “This transaction validates the successful rehabilitation program of the Tiwi-MakBan facilities,” said Liza Montelibano, first vice presi-dent and chief financial officer of AboitizPower. “The deal opens a new avenue for financing and re-financing our various projects, al-lowing AboitizPower to redeploy capital toward our large pipeline of new power investments that include renewable energy. We are committed to support the energy needs of the country, and in build-ing renewable-energy resources through our brand, Cleanergy.” A boit i zPower ’s C lea nerg y por tfol io is composed of 29

hydro and geothermal power-generation facilities with a total of 915 megawatts attributable net sellable capacity. The ADB’s credit enhancement will be risk-participated by the Credit Guarantee Investment Fa-cility (CGIF), a multilateral facility established by Asean+3 govern-ments and the ADB to develop bond markets in the Asean+3 re-gion. Tiwi-MakBan is CGIF’s first support for project bonds and illustrates the facility’s growing role in contributing to local debt capital-market development. The ADB, based in Manila, is ded-icated to reducing poverty in Asia and the Pacific through inclusive economic growth, environmentally sustainable growth and regional integration. Established in 1966, it is owned by 67 members—48 from the region.

ADB backs first climate bond in Asia in landmark $225-M PHL dealCredit-enhanced project bonds offer an attractive

alternative to bank financing, and by mobilizing cost-effective, long-term capital can help close the region’s infrastructure gap.”—F

Trade-facilitation pact seencutting traders’ cost by 30%but Manila has yet to submit the instrument of acceptance to the trade body, which would insert the TFA into the WTO agreement. Cristobal said he expects the in-strument of acceptance to be sub-mitted to the WTO before the new president assumes office. The TFA contains a list of trade- facilitation commitments that WTO members must commit to once they’ve agreed to be party to the agreement. The Philippines, being a developing country, has applied for “special and differential treatment,” allowing it to delay the

implementation of each provision of the text according to their needs. These commitments are divided into Category A, B and C. Category A measures refer to those that the Philippines can implement by the time the agreement enters into force. Manila is allowed a “transi-tional period” to implement mea-sures under Category B following the agreement’s effectivity. Com-mitments under Category C can be implemented at a later data after a transitional period. For the TFA to come into force, two-thirds of the WTO member-ship must ratify the agreement by submitting its “instrument of

acceptance” to the WTO. The pact will apply only to those who have agreed to it.

The WTO said the TFA could increase total world trade to $23 trillion from the current estimate of $22 trillion.

The Organization for Economic Co-operation and Development said the TFA could lower trade costs by 11.7 to 15.1 percent for lower-middle income countries, such as the Philippines.

Traders incur huge costs due to “red tape,” absence of an auto-mated system and the lack of co-ordination between traders and customs agencies.

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