How PSEi member stocks performed — January 15, 2020
Here’s a quick glance at how PSEi stocks fared on Wednesday, January 15, 2020.
DoH freezes prices of medical goods in Batangas calamity zone
THE Department of Health (DoH) has ordered a price freeze on 218 medicines as well as other medical goods in Batangas province, following widespread panic-buying of N95 masks, which are rated for filtering out volcanic dust.
Issued Tuesday, the order, DOH 20202-005 ordered prices to be frozen in the province. The DoH is authorized by law to regulate prices of medical products. Batangas province, where Taal Volcano is located, has been placed under a state of calamity, which also triggers more general price-control measures.
health Undersecretary Rolando Enrique D. Domingo said in a briefing Wednesday that the list contains “lahat ng essential medicines. So, pati iyong mga high-blood, pang-diabetes, pang-asthma, ito iyong mga essential na hindi puwedeng tumaas (The price controls cover essential medicines for hypertension, diabetes, and asthma). Mayroon siyang range and it includes some devices like iyong mask (There is a prescribed range. The list also includes devices like masks).”
Also in the list are respiratory tract medicines, antibiotics, and cardiovascular medicines.
The order covers N95 masks, which are capable of filtering out particulates like volcanic dust. It said the permitted N95 price range was P45 to P105 pesos, while the price range for disposable surgical masks was P1 to P8. According to reports, consumers have been hoarding N95 masks, with prices rising to as much as P500 each.
The Department of Trade and Industry (DTI) also warned against profiteering and counterfeit masks.
During its inspection of a district in Manila where dealers of medical supplies are clustered, Trade Undersecretary Ruth B. Catelo found 12 out of 17 stores selling fake N95 masks. The DTI will be filing administrative charges against these store owners.
“Under Article 52 of the Consumer Act (these activities fall under) unfair and unconscionable sales acts or practices. They are taking advantage of the situation, the difficulties being experienced by consumers,” she said at the same briefing on Wednesday.
The DTI has noted that N95 masks are not on the suggested retail price list and added that it has contacted foreign suppliers to send more inventory.
DTI said in a statement Wednesday that its monitoring teams in Cavite, Laguna, Batangas, Quezon, and Metro Manila are tracking the prices of masks and other goods.
The DTI’s own findings are that N95 masks are selling for P120 to P150 per piece — outside the DoH’s own prescribed range — while surgical masks that normally sell for P1 each have been selling at P4 after the Taal emitted heavy ash starting Sunday.
“While we recognize that the N95, surgical, and other similar masks as medical supplies are under the jurisdiction of the Department of Health (DoH), the DTI readily dispersed its teams to monitor the prices and supply of these masks to assist the DoH and the consumers,” Trade Secretary Ramon M. Lopez said.
“As the Health Department, we understand that its utmost priority is ensuring the lives and health and safety of those who are affected by the phreatic eruption. Market surveillance and monitoring is the best form of immediate assistance that the DTI can provide. As the President constantly underscores, A whole-of-government approach is highly necessary and called for especially during times of calamities and disasters.”
DTI said that drug and medical stores have committed not to raise prices.
“However, the Price Act (Republic Act 7581) provides that the National Price Coordinating Council (NPCC) which the DTI and DoH are part of, can recommend to the President the inclusion of these masks in the list of basic or prime goods. When approved, the NPCC through the recommendation of the DoH and consultation with relevant stakeholders, can set an SRP, if found necessary,” the DTI said in a statement.
Along with foreign supplies, DTI had also asked domestic suppliers and major drug store chains including Mercury Drug, Watsons, and Southstar Drug to immediately restock in areas affected by the calamity.
“At the interim, current inventory in their branches and warehouses in non-affected areas will be distributed to their stores in CALABARZON (the Cavite-Laguna-Batangas-Rizal and Quezon region) and Metro Manila while waiting for the arrival of new stocks,” DTI said.
The DTI said in an earlier advisory that stores found to have been profiteering will face administrative or criminal charges.
The department reiterated that the prices of manufactured basic and prime goods will continue to conform to the DTI Suggested Retail Price (SRP) Bulletin published on Sept. 30.
The Batangas government has issued its own price freeze on basic goods and commodities, which is authorized by the Price Act, which comes into force upon a calamity declaration.
Price-controlled goods must still be sold for the suggested retail price (SRP).
Meanwhile, the Department of Tourism (DoT) is advising tourist establishments to consider health risks to visitors and workers should the situation at Taal Volcano deteriorate.
It said in a statement Wednesday that it “advises all tourism enterprises operating in all affected areas of the Taal Volcano disaster to immediately cease operations in light of the Phivolcs Alert Level 4 warning. The continued health, safety and welfare of our workers and tourists remain a top priority at this time as authorities have not downgraded the advisory on an imminent eruption.”
The Department of Labor and Employment (DoLE) on Wednesday also announced it will provide initial emergency assistance of P72.3 million to workers in the area. Labor Undersecretary Renato L. Ebarle said in a statement: “The assistance will be in the form of emergency employment under the government internship program where beneficiaries will be mobilized by the LGUs in the rehabilitation of nine affected municipalities of Batangas.” — Gillian M. Cortez and Jenina P. Ibañez
DPWH sees Taguig River slope protection works completed by midyear
THE Department of Public Works and Highways (DPWH) said its P279.3-million slope protection project along the Taguig River is expected to be completed within the first half of the year.
“Completed within six (6) months, the slope protection project with bank improvement was implemented into several phases and subprojects situated along Taguig Bridge, M.L. Quezon Bridge, and Taguig River East and West Bank,” the DPWH said in a statement Wednesday.
It said the P279.3-million slope protection project is being built to ensure the safety of residents in the area, which is prone to flooding from the river, especially during the rainy season.
The DPWH said the project was funded out of the 2018 and 2019 General Appropriations Acts (GAA).
“The project was reported to be a part of a proposed linear park and roadway, which will serve as an alternate route that will decongest traffic in Taguig,” it said.
According to Public Works Secretary Mark A. Villar, the new structure will help prevent flooding in both Taguig City and Pateros.
The DPWH considers some places in Taguig and Pateros to be very susceptible to flooding. With the speedy completion of this project, residents can be more relieved knowing that a structure now safeguards their lives and properties.
In 2015, the DPWH issued a department order covering the implementation of flood control and drainage/slope protection projects which are funded, or proposed for funding, by the national government under the DPWH infrastructure program. — Arjay L. Balinbin
Developing resilience in 2020
The year 2020 started with a bang. From the wildfires that have been ravaging Australia, to the floods in the Indonesia capital, and to the political strife between the United States of America and Iran, the world has been in a constant state of flux. Here at home, we were treated to a spectacular volcanic plume that is causing dread and despair in Batangas, Laguna, and Cavite. This eruption reminds us of how nature’s wrath and fury should teach us to become more resilient.
In her Harvard Business Review article on how resilience works, Diane Coutu states that “more than education, more than experience, more than training, a person’s lever of resilience will determine who succeeds and who fails. That’s true in the cancer ward, it’s true in the Olympics, and it’s true in the boardroom.” We need resilience in our volatile, uncertain, complex, and ambiguous world. According to Coutu, resilient people possess the following: “a staunch acceptance of reality; a deep belief, often buttressed by strongly held values, that life is meaningful; and an uncanny ability to improvise.” Thus, we must develop resilience so that we can face the challenges within and outside our offices and homes in this new decade.
How do we develop resilience? There have been numerous studies on the development of individual-level resilience and organizational resilience specifically in the field of positive psychology and organizational behavior. Shawn Anchor and Michelle Gielan, in their Harvard Business Review article entitled “Resilience Is about How You Recharge, Not How You Endure,” assert that a resilient person is well-rested. This means that a person who is overworked and exhausted will not be resilient. Rather, “The key to resilience is trying really hard, then stopping, recovering, and then trying again.” Thus, working on a task for a prolonged period can be beneficial only if high-endurance performance is coupled with recovery.
But what is recovery? Zijlstra, Cropley, and Rydstedt, in their article “From Recovery to Regulation: An Attempt to Reconceptualize Recovery from Work,” differentiate between internal and external recovery. Internal recovery refers to “shorter periods of relaxation that take place within the frames of the workday or the work setting in the form of short scheduled or unscheduled breaks, by shifting attention or changing to other work tasks when the mental or physical resources required for the initial task are temporarily depleted or exhausted.” External recovery pertains to “actions that take place outside of work-in the free time between the workdays, and during weekends, holidays or vacations.”
The importance of maintaining appropriate levels of energy has been theorized by Stevan Hobfall in his conservation of resources theory, which “describes the motivation that drives humans to both maintain their current resources and to pursue new resources.” To become more resilient, we must be aware of our energies and find ways to conserve, maintain, and build our resources.
Another way to become more resilient is by developing an entrepreneurial mindset. Such a mindset does not mean that people must start their own businesses. Rather, it means thinking like an entrepreneur and applying this mindset to one’s personal and professional lives.
I gave a talk last November on “Developing an Entrepreneurial Mindset for Climate and Disaster Resilience,” hosted by the Resilience Institute of the University of the Philippines. I focused on how individuals and organizations must have an entrepreneurial mindset similar to the growth mindset espoused by Carol Dweck in her groundbreaking bestseller entitled, Mindset: The New Psychology of Success, in order for people to become more resilient. To become more resilient, one must have the following tools for life advocated by the National Foundation for Teaching Entrepreneurship: “flexibility and adaptability; communication and collaboration; creativity and innovation; future orientation; opportunity recognition; and comfort with risk.” Entrepreneurs or not, we can apply all of these traits to become more resilient.
The year and decade have just begun, and we are already faced with external upheavals. Given these issues and concerns that we will continuously face, having a resilient mindset will make us future-ready.
Brian C. Gozun is professor of the Decision Sciences and Innovation Department of the Ramon V. Del Rosario College of Business, De La Salle University Manila. He is doing research on resilience both on individual and organizational levels.
Smoking, vaping and the nanny state
“To act on the belief that we possess the knowledge and the power which enable us to shape the processes of society entirely to our liking, knowledge which in fact we do not possess, is likely to make us do much harm.”
— Friedrich Hayek,
“The Pretence of Knowledge”
— Nobel Prize lecture
Dec. 11, 1974
Among the stories we hear and read in the debates on higher tobacco/alcohol tax, smoking/vaping ban, are that 1.) smoking prevalence remains high and rising, 2.) vaping is not a smoking-cessation tool but smoking-enhancement, and, 3.) more government taxation and prohibitions are good to protect public health.
These are all myths and not consistent with facts. Here are the numbers and reasons why.
On No. 1, in most countries, smoking prevalence is declining. There has been a big decline of 10-11 percentage points for South Korea, Japan, and the Philippines in a span of 16 years. And as of 2015, only 2% of Philippine adults and 4.5% of youths were users of smokeless tobacco or e-cigarettes, vaping products (see Table).
On No. 2, vaping products have actually become smoking substitutes or smoking-cessation tools, leading to a decline in smoking prevalence of five to 10 percentage points in the Philippines, Malaysia, and Thailand as a portion of their smokers shift to smokeless, non-burning nicotine substitutes.
A “gateway theory” that vaping leads to smoking in young people is just a disproven hypothesis. In early 2019, a UK anti-smoking charity, Action on Smoking and Health (ASH), released a report showing that vaping remains uncommon among young people and is almost exclusively confined to current or past smokers, and that most teen vaping is experimental and short-lived.
Recently, the President, supported by the Department of Health, ordered a ban on vaping in public places. Government over-regulation follows the famous Newton’s third law of motion: “for every action there is an equal and opposite reaction.” Restated it becomes “for every government intervention and taxation, there is an equal and opposite distortion.”
Seven examples and cases below show why No. 3 above is wrong:
One, more prohibition means more corruption. Prostitution, drugs, certain gambling, gun running, etc. are prohibited, not just restricted and taxed in the Philippines. And these prohibited activities and products are all around. That implies that the police and government officials themselves, local and national, allow their proliferation in exchange for big bribes, other financial and political favour.
Two, more smuggling. The National Committee on Intellectual Property Rights (NCIPR) reported that full year 2018 seizures of pirated and counterfeit goods jumped to P23.6 billion. Of this, fake or smuggled cigarettes were P20.3 billion or 86% of total. Higher tobacco taxes under the TRAIN law of 2017 resulted in many smokers buying cheaper, smuggled tobacco.
Three, recent cases of coconut wine or lambanog poisoning in the Philippines. At least 23 people died due to suspected methanol poisoning, with over 500 hospitalized. As branded alcohol becomes more expensive due to more taxes, more drinkers shift to cheaper, untaxed, unbranded alcohol like lambanog, where products can include chemicals and prohibited substances.
Four, the Singapore vape ban has been in place for two to three years now. But instead of killing vaping, it sent it underground. There were seizures of $30,000 worth of illegal e-cigarettes in September, another $66,000 worth in November 2019.
Five, with misregulations around e-cigarettes in the US, illicit pods containing tetrahydrocannabinol (THC) oil together with Vitamin E acetate as a thickening agent have become widely available. Around 55 people have died after using these black market products rather than standard vape juice.
Six, when I was in southern Sweden in 2003 for two months, I noticed and read that Swedes who wanted cheaper booze would travel to Denmark to buy lots of beer and alcohol because Sweden’s alcohol taxes are very high. The same in Scotland after “minimum unit pricing” on alcohol was introduced in 2018 — Scot drinkers would go to England across the border to get cheaper alcohol.
Seven, in the UK, smoking data released after the implementation of plain packaging for tobacco products shows that for the first time in seven years, the smoking rate has risen. Illicit and smuggled tobacco became much easier because of the ease of copying the packs and cheaper prices. The same thing happened in Australia after its plain packaging policy was instated in 2012 — illegal tobacco use came in higher starting 2013, shown in KPMG study.
Friedrich Hayek has reiterated that “all-knowing” pretense and central planning of a nanny state can backfire. Thus, the state should step back from over-regulations and prohibitions. People own their bodies, not the state or NGOs. More state prohibitions only send people to seek illicit, even dangerous products and activities.
Bienvenido S. Oplas, Jr. is the president of Minimal Government Thinkers.