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NFA private-sector rice auction awards deals for 500,000 MT

FIVE PRIVATE bidders from across Southeast Asia will be awarded contracts by the National Food Authority (NFA) to import 500,000 metric tons (MT) of rice, with the auction finding takers even though bids were generally lower compared to the reference price of $447.88 quoted in the government-to-government auction earlier in the month.
Half of the auctioned volume is contracted to arrive by Dec. 31, ensuring the availability of large volumes of staple around the year-end holiday period.
The successful bidders were: Thai Capital Crops Co. Ltd, Myanmar’s Shwe Wah Yaung Agriculture Production Co., Singapore’s Olam International Ltd, Thailand’s Asia Golden Rice Co Ltd, and Vietnam’s Tan Long Group Joint Stock Co. The awarded volumes are subject to post-qualification processes, and formal awards will be made within the week.
Reuters reported that the rice to fill the Philippine order will be sourced from Vietnam, Thailand, Myanmar, India and Pakistan.
Thai Capital Crops was awarded a lot amounting to 45,000 metric tons for delivery to General Santos and Davao, after it bid $439.75 per MT.
Olam International was awarded 65,000 MT for delivery to La Union after bidding $429.80 per MT. It also won a lot of 40,000 MT for delivery to Batangas after bidding $425.80 per MT; 30,000 MT for delivery to Tabaco, Albay following a bid of $432.10 per MT; and 75,000 MT for delivery to Manila after bidding $434 per MT.
Tan Long Group was awarded a lot of 118,000 MT for delivery to Subic at $459 per MT.
Asia Golden Rice was awarded a lot of 54,000 MT for delivery to Cebu and Tacloban at $458 per MT; and a further 54,000 MT for delivery to Zamboanga, Cagayan de Oro and Surigao at $439.75 per MT.
Shwe Wah was awarded a lot of 28,000 MT for delivery to Iloilo and Bacolod after bidding $418.65 per MT.
Judy Carol L. Dansal, NFA Deputy Administrator for Marketing Operations, told reporters that the delivery deadlines for half the volume is before the end of the year.
“The terms of reference have schedules of 250,000 MT arriving not later than Dec. 31, and the other 250,000 arriving in January,” Ms. Dansal said.
The 500,000 MT forms part of the 750,000 MT authorized for importation by the NFA in 2018.
A government-to-government auction of up to 250,000 MT has awarded only 43,000 MT. — Reicelene Joy N. Ignacio

Senate bill filed granting perks to OFW-owned firms

SENATOR Paolo Benigno A. Aquino IV has filed a bill seeking to provide incentives and benefits to overseas Filipino workers (OFWs) who start businesses in the Philippines.
Senate Bill No. 2101 or the proposed Business Incentives for OFWs Act provides for incentives such as five-year tax exemptions for OFW-owned enterprises.
Other incentives include a 50% reduction in real property tax as well as tax and duty-free importation of raw materials, capital equipment, machinery, and spare parts used exclusively in the operations of the business.
Qualified businesses will also receive preferential access to financing from government financial institutions at below-market rates for five years.
Mr. Aquino said the filing of the proposed measure was based on a suggestion of an OFW from Batangas City during a consultation session.
“This is a reform that was requested by our OFWs. Many of them want to have a livelihood in the Philippine and to spend time with their families,” the senator said in a statement.
“One of the sources of livelihood of our OFWs is to have a successful business. Let’s give them the opportunity to have a livelihood in the Philippines so they could be with their families and see their children grow up,” he added. — Camille A. Aguinaldo

Senate panel to resume hearings probing third-player selection

THE Senate committee on public services will resume next week its hearing on the selection process for third entrant into the telecommunications industry, the so-called “third player.”
In a statement on Tuesday, Senator Grace S. Poe-Llamanzares, who chairs the committee, said the hearing will focus on the details that led to the selection of the Mislatel Group as the third player.
“Next week, we will resume our public hearing on the third telco and we will use the opportunity to delve into the details of the decision to choose Mislatel,” she said.
The Senate hearing was earlier scheduled for Thursday, Nov. 22 but was later cancelled due to the unavailability of government officials due to the visit of Chinese President Xi Jinping.
“Because of (the) State Visit, we had to move the date and make sure government officials are available,” the senator said in a text message to reporters.
The government on Monday declared the Mislatel Group of China Telecommunications Corp., Dennis A. Uy’s Udenna Corp. and Chelsea Logistics Holdings Corp., as well as Mindanao Islamic Telephone Company, Inc. (Mislatel) as the telecom industry’s third player.
Department of Information and Communications Technology (DICT) Acting Secretary Eliseo M. Rio, Jr. has said Mislatel could launch commercial operations in mid-2019.
Ms. Poe-Llamanzares said the committee will hear from the DICT, the National Telecommunications Commission (NTC), and Mislatel officials on the services to be offered to the public by the third player.
Experts will also weigh in on national security issues due to the presence of a foreign telco in the winning consortium.
“While we have been assured by the NTC and the DICT that the selection process was without bias, we cannot be remiss on our duty and mandate to look into the matter,” Ms. Poe-Llamanzares said.
“We should also take note that it is a requirement under our laws that the third telco or its Filipino partner must secure a congressional franchise. In the end, transparency, accountability and integrity are always the benchmark for government projects and undertaking,” she added. — Camille A. Aguinaldo

Nomura says US-China trade war offers import substitution opportunities

ASIAN countries can benefit from the trade war between the US and China through short-term import substitution programs under which companies will seek to replace expensive imports with items sourced from other countries, Nomura said in a report.
They can also benefit through production relocation where multinationals are prompted to divert some of their production to factories in other countries, Nomura said, citing the results of its research, where it found that some parties could end up “relative winners” despite the trade war.
“In the short-term, if the US and China charge higher tariffs on each other’s imports, then companies will have an incentive to replace these expensive imports with local production sources or substitute from other countries,” it said.
“Meanwhile, a prolonged US-Sino trade conflict, in the medium term, would encourage MNCs (multinationals) to start diverting some of their production to factories in other countries to escape tariffs, or even relocating whole plants if the trade war sustains,” it added.
Nomura said the results of its study of 13 Asian countries show that Malaysia stands out as the biggest beneficiary of import substitution, followed by Japan, Pakistan, Thailand and the Philippines. Bangladesh, India and South Korea came out as the least likely to gain on a relative basis.
“Breaking down the results we find that many ASEAN (Association of Southeast Asian) countries are best placed to benefit from the US imposing tariffs on China; while Pakistan, Japan and Malaysia could benefit from China imposing tariffs on the US,” it said.
Nomura said its looked into the specific products that are likely to benefit in each country. For instance, the biggest benefit to Malaysia is likely to come from electronic integrated circuits, liquefied natural gas and communication apparatus.
“For others, there is usually one leading product: ‘vehicles with only spark-ignition internal combustion reciprocating piston engines’ in Japan, cotton yarn in Pakistan, ‘units of automatic data processing’ in Thailand and ‘electronic integrated circuits’ in the Philippines,” it said.
On production relocation, Vietnam is the clear standout if companies were to divert production and foreign direct investment (FDI) from China, Nomura said. It is followed by Malaysia, Singapore and India.
“Interestingly, while Pakistan is one of the biggest beneficiaries from import substitution, it benefits least from the diversion of production and FDI,” it said.
Nomura also enumerated the top 15 products across each of the 13 Asian countries that could benefit from import substitution in a US-Sino trade war and their importance for the country.
For the Philippines, this list is topped by electronic integrated circuits; processors and controllers, whether combined with memories, converters, logic circuits, amplifiers, clock and timing circuits, or other circuits. — Victor V. Saulon

PHL improves ranking in WB/PwC in study on ease of paying taxes

THE PHILIPPINES placed 94th out of 190 economies on the ease of paying taxes, according to the World Bank and PricewaterhouseCoopers’ Paying Taxes 2019 report, after the country ranked 105th a year earlier.
The Philippines scored 71.80 points, below the Ease Asia and the Pacific average of 72.98 points.
In the region, the Philippines outperformed the scores posted by Indonesia and Laos of 68.03 and 54.22, respectively. Thailand scored 77.72, and Malaysia 76.06.
The study found that Philippine taxpayers have to pay 14 taxes, an improvement from 20 in the previous report. The regional average is 21.2.
It now takes 181 total hours to prepare, file, and pay taxes in the Philippines, an improvement from 182 hours in the previous report. The East Asia and Pacific average is 180.9 hours. The tax contribution rate was 42.9%, above the 33.5% regional average.
The report’s post-filing index — a new measure of the efficiency of claiming tax refunds — had the Philippines scoring 50, against the regional average of 56.42.
In 2018, the Philippines implemented the Tax Reform for Acceleration and Inclusion (TRAIN) law.
The law lowered personal income, donor, and estate tax rates, reduced value-added tax exemptions, while raising taxes on tobacco, automobiles, fuel, coal, minerals, documentary stamps, and imposing new taxes on sugar-sweetened beverages and cosmetic procedures, among others, while improving tax administration.
“Technology is transforming the nature of jobs that are available and the skills needed to do them. This in turn is likely to require greater investment in human capital, especially in learning and development. It is therefore vital that governments are able to understand the challenges ahead and how they can build resilience for public finances in the long term. We hope that this report will be of value to all those interested in making tax systems more efficient, whether in government, business, academia or civil society,” said World bank Senior Manager Rita Ramalho.
Andrew Packman, leader for Tax Transparency and Total Tax Contribution at PwC, added: “This report highlights the extent to which, when implemented strategically, new technology can drive considerable efficiencies for tax authorities and businesses alike. Yet it is also important to remember that improvements to tax systems do not come from technology alone. Simple, coherent, well understood and properly administered tax systems can help to lower the barriers for businesses to move from the informal to the formal sector. This can broaden the tax base and raise revenue without requiring new taxes. To do so, tax professionals and policy-makers need to have access to the correct skills and insight, which technology gains can help to support.” — Elijah Joseph C. Tubayan

DoF tells PEZA that TRABAHO reflects Duterte’s wishes

THE DEPARTMENT of Finance (DoF) said the Philippine Economic Zone Authority’s (PEZA) objections to the reforms outlined in the Tax Reform for Attracting Better and High-quality Opportunities (TRABAHO) bill mean the agency is defying a presidential directive.
“Rather than make an 11th hour appeal to President Duterte to reconsider his own directive supporting corporate income tax (CIT) and fiscal incentives reform that will benefit more than 99% of businesses, the Philippine Economic Zone Authority (PEZA) should explain to Filipino taxpayers why it insists on subsidizing at their expense the multibillion-peso dividends and profits of large corporations that do not actually need such perks,” the DoF said in a statement on Tuesday.
PEZA has been vocal in its opposition to the TRABAHO bill. It warned of potential job losses and closures by locators.
“PEZA (Director General Charito B. Plaza) is free to talk to the President. But the President already approved this comprehensive tax reform program as early as January 2018 in a Cabinet meeting and reiterated this in his State-of-the-Nation Address (SONA). We should not stand in the way of a presidential directive,” Finance Assistant Secretary Antonio Joselito G. Lambino II was quoted as saying.
Ms. Plaza has said that she will elevate her concerns to President Rodrigo R. Duterte as she seeks to maintain the status quo on the fiscal incentives regime for PEZA locators.
Finance Undersecretary Karl Kendrick T. Chua said earlier consultations had incorporated the concerns of PEZA and other stakeholders.
“In fact, we took into consideration PEZA’s comments, which was why several changes were made to the original Package 2 proposal. During our consultations with Director General Plaza, she even agreed to the principles of Package 2 — that it be performance-based, targeted, time-bound and transparent,” said Mr. Chua.
Ms. Plaza has yet to respond after being asked for comment.
The bill, which is the second tax package after the Tax Reform for Acceleration and Inclusion (TRAIN) law, seeks to cut the corporate income tax rate gradually to 20% by 2029 via a two-percentage-point reduction every other year starting 2021.
Fiscal incentives will be limited to industries identified in the Strategic Investments Priority Plan (SIPP) and will make them subject to performance benchmarks. Incentives will be harmonized into a single menu, including: a three-year income tax holiday, after which, a special net income tax rate of 17% will be charged starting 2021; deductions for labor, research and development, training, and infrastructure development expenses; and some customs duties exemptions for up to five years. Following this, companies will be taxed under the prevailing corporate tax scheme.
Currently, income tax holidays can run as long as nine years, with locators enjoying a 5% tax on gross income earned in lieu of all other taxes enjoyed in perpetuity.
The TRABAHO bill was approved on final reading at the House of Representatives in September. The counterpart bill in the Senate is pending at the committee level.
Mr. Chua said that the bill will keep the one-stop-shop function of PEZA, addressing firms’ request to avoid having to do business with business local government units. He added that more jobs will actually be created as 90,000 small and medium enterprises will benefit from lower taxes, against about 1,000 larger corporations that will have their incentives rationalized.
Mr. Lambino said maintaining the status quo is a band-aid solution to cover up the structural defects of the business environment, which the government has been doing for over 50 years and “has not encouraged export diversification and innovation.”
“Instead, the outcomes are corporate geese fattened from incentives granted forever, declining export competitiveness, and foreign direct investment (FDI) inflows that remain lackluster if compared to our neighbors,” he said.
The new tax structure “favors investors that support our development objectives, which are: to create more and better jobs, promote research and development, encourage innovation, stimulate domestic industries, promote countryside development, and diversify our product base to higher-value exports.”
Earlier, the DoF said that in 2015, the government gave away P86.3 billion worth of income tax incentives to firms that paid out a total of P141.8 billion combined in dividends to their respective shareholders. — Elijah Joseph C. Tubayan

It’s about expanding the mining tax base

Globally recognized, the Philippines is one of the most mineral-rich countries, with an estimated $840 billion worth of untapped mineral wealth. But unknown to most, it is subject to doubled excise taxes when the Tax Reform for Inclusion and Acceleration (TRAIN) Law took effect. Along with other local and national regulations and taxes from excise tax, royalty-mineral reservation, local business tax to registration fee, withholding tax and VAT, among others, it is a heavily taxed industry.
Mining industry statistics from the Mines and Geosciences Bureau (MGB) shows that total gross production value of mining is at P109.5 billion during the First Quarter of 2018. However, more recent data from the Philippine Statistics Authority notes that gross value added in mining and quarrying declined by 1.1% in the third quarter of 2018 from the same period in 2017 despite expansion of gold and copper subsectors by 9% and 7.7%, respectively.
Industry players and third-party observers blame the country’s unfriendly policy environment to its inability to tap the sector’s potentials. To add salt to injury, the House of Representatives recently passed on third reading House Bill (HB) 8400 which further increases mining taxes. The final version (HB 8400) imposes a range of royalties applied to income from mining operations. This includes a 1-5% margin-based royalty tax on large-scale mines, depending on operation margins, a 1-10% windfall profits tax on income from mining operations, and thin capitalization and ring-fencing.
In a recent roundtable discussion on this proposed mining fiscal regime organized jointly by independent think tank Stratbase ADR Institute (ADRI) Institute, Philippine Business for Environmental Stewardship the Department of Environment and Natural Resources, and the MGB, UP School of Economics professor Ramon Clarete said that high taxes will not amount to anything if the mining tax base remains stagnant. He adds that “the only way I can have a good base is to encourage investors to find it for me. You can’t do that if you have an onerous taxation.” Dr. Clarete advised that rather than imposing new higher taxes, it would be more beneficial to expand the tax base. This can be done by attracting more foreign investors especially with large upfront investments in exploration and development even before revenues from mining operations come in.
Introducing higher taxes not only disincentivizes legitimate business stakeholders, but possibly affects billions worth of what the government may be earning. With production value possibly to decline even more, imposing higher taxes is not really the rational solution. According to Dr. Clarete’s presentation, the proposed tax reform will raise the weighted average effective tax rate (AETR) on mining “by at least 16% to utmost 81%” which is already uncompetitive with other countries to begin with. Using an econometric model, he furthered that investments in mining may decline by at least 13% to at most 67%. Even with the TRAIN tax on mining, the increase of 2 to 4% in excise tax only resulted in P1.2 billion in government revenues, while deadweight loss is at P37.4 billion.
excavator
However, what government may want to consider, is an income-based tax scheme (e.g. corporate tax and resource rents taxes) compared to an output-based tax scheme. Since this depends on the net income of mining firms, he explained that this tax scheme may be more advantageous since it is more reliable, generally progressive and neutral. Though more complicated to administer, this seems to be preferred by the private sector too, since revenues from mining activities are very volatile. “If rates are fixed over the business cycle, [then] taxpayers and state are penalized or favored by the tax regime,” he adds.
As Stratbase ADRI President Dindo Manhit said, we need “a more balanced policy in close consultation with stakeholders and backed by scientific data must be crafted that carefully considers competitiveness not just in the volatile global market of metallic ores but also in attracting large foreign investments needed in legitimate mining operations.”
To wit, Dr. Clarete explained that five years ago, the country “lost about $6.2 billion of copper/gold mining investments in Mindanao, and other projects [that] failed to materialize because approval [was] tied to getting Congress to pass the proposed tax increase.” Perhaps it may be a better strategy to incorporate flexibility in its tax regime to fluctuating metal prices in the world market, rather than increasing its tax rates.
True, there may be a need to revisit tax regimes to make sure they reflect the current conditions, and translate to more equitable share of the government. However, this will be unlikely if our regulatory environment appears to drive away current and potential investors. This is an opportunity we cannot afford to miss, we need to take a closer look at how the proposed fiscal reform is with respect to the industry’s need to be competitive and very attractive to quality investments to develop the huge potential of our mineral resources. Of course, all in the context responsible mining.
 
Vanessa Pepino is an Environment Fellow of the Stratbase ADR Institute.

Giving up on the impossible dream

“In union there is strength” has become such a cliche that even otherwise sensible people tend to forget its inherent wisdom.
In the wake of the declaration of martial law by President Ferdinand Marcos, assorted government entities, from the Office of Civil Relations of the Philippine Constabulary to the Department of Public Information to various committees in the legislature saw an opportunity to exercise control over the media and advertising industries.
In a defensive move, raising the cry of “self-regulation,” broadcast media companies decided to band together as the Kapisanan ng mga Brodkaster ng Pilipinas (KBP), newspapers and magazines set up the Print Media Organization (PRIMO) and the advertising agencies organized two separate groups, the Association of Accredited Advertising Agencies, Philippines (4As-P) and the Lapian ng mga Advertising Practitioners sa Pilipinas (LAPPIS).
These industry associations then joined forces with the Philippine Association of National Advertisers (PANA) and, together, under the unified banner of the Philippine Board of Advertising (PBA), they pushed the concept of self-regulation more aggressively with the Marcos government. Other industry groups, such as outdoor advertising companies and commercial production houses, also joined the PBA. The 4As-P and LAPPIS also decided to become one ad agency organization under the PBA.
The PBA, as the single unified voice of the media and advertising industries, wielded enough influence and potential power to persuade the government to back off and allow self-regulation.
I distinctly recall a meeting with Senators Butz Aquino and Joey Lina, that I participated in as president of 4As-P, where the two bared a plan to regulate the way ads were to be written and commercials were to be produced to ward off “negative foreign influences” (Lina even cited Michael Jackson’s song, “Bad,” as an example). Mercifully, we succeeded in changing their minds.
I also recall my late boss, Tony de Joya, chairman of Advertising & Marketing Associates and the Asian Federation of Advertising Associations (AFAA), tirelessly lobbying the Senate and successfully preventing some power-hungry senators from inflicting punitive bills on the ad industry.
Well, so much for “ancient history.” A few years ago, the PBA (which had been renamed the AdBoard) was dismantled because several member organizations had “gone on leave,” a euphemism for breaking away.
I remember receiving an email from Noy Diy-Liacco, then a senior executive of Nestle Philippines and still active in the ad industry, asking me to comment on the demise of the AdBoard and provide a historical perspective on the formation of the PBA.
My response, though not in so many words, was that they who do not learn a lesson from history were bound to relive it. I said that, one day, a power-lusting government functionary would consider it a good idea to “regulate” the ad industry. When that happens, a unified ad industry body like the AdBoard would become an urgent necessity again.
In a virtual case of deja vu, what has befallen the Philippine media and advertising industries may happen to the Filipino community in America.
In early 1997, I was among a group of community workers in Northern California who gathered in Salinas to answer the call of visionaries, led by Alex Esclamado, Rodel Rodis and Dennis Normandy, for the formation of a national organization of Filipinos in America.
As a result of that meeting, the first Filipino American National Empowerment Conference was scheduled in Washington, D.C. in August of that year. I was assigned to handle the wordsmithing of the rationale for the conference. The essence of the verbiage was the need for Pinoys in America to harness our growing numbers to achieve socio-cultural, economic and political empowerment.
We had noted that significant events in the United States were passing us by. In spite of the rapidly increasing ethnic Filipino population, we had been routinely overlooked — in fact, ignored — by public officials, politicians, corporations and mainstream America and, as a result, had not enjoyed the social services and other benefits that the government and businesses were making available to other minority groups.
We had concluded that the main reason was because Filipinos in the US were not united, but consisted of thousands of small organizations concerned mainly with insular issues. The concept of “empowerment” — socio-cultural, economic and political — rarely crossed our minds.
Esclamado had proven that a unified FilAm community, speaking with one voice and harnessing its numbers, could influence the decision makers in the US. He had organized “Browns for Brown” when a young Jerry Brown first ran for governor of California. When Brown won, he asked Esclamado what the FilAm community wanted from his government. That question resulted, among other benefits, in the appointment of the first FilAm judge in Northern California, Ronald Quidachay. The same unified voice had persuaded the US government to allow Filipino doctors, accountants and other professionals to practice their professions in America.
Esclamado envisioned a national organization of Filipinos that would have some influence in state houses and in Washington, D.C. He was told that it was an “impossible dream,” but he and other dreamers decided that it was worth pursuing. Thus was conceived the national empowerment conference.
Performing an almost superhuman feat, Esclamado, as the principal proponent, literally traveled (in many cases, drove) across the US with his wife, Luly, to persuade FilAm community leaders (most of whom had never met nor heard of each other) to attend the event.
Over 2,000 attended. It was the biggest gathering of Pinoys in America. Thus was the National Federation of Filipino American Associations (NaFFAA) formed.
Esclamado was elected founding national chairman. Washington, D.C.’s Gloria Caoie and Jon Melegrito, who virtually invested sweat and blood to head the host committee, were elected national vice-chair and director, respectively.
The beginnings of the “impossible dream” had been achieved through the Quixotic persistence and determination of Esclamado, Caoile, Melegrito, Rodel Rodis and, subsequently, Loida Nicolas Lewis.
I did my part as a volunteer and worker, inspired by those who virtually tilted at windmills. I eventually became national chair of NaFFAA for one term and helped to keep it alive, at a time when the federation was almost on its knees due to lack of funds.
NaFAA has since become the go-to organization for Capitol Hill and for the White House, whenever they need to reach out to the FilAm community. Its leaders have notched notable achievements such as gaining benefits for Filipino World War II veterans, and the conferment of the Congressional Gold Medal on the old soldiers, dead or alive; supporting FilAm candidates for city, state and national office; and calling worldwide attention to Chinese intrusion in the South China Sea, as well protesting instances of discrimination against Filipinos.
But the “impossible dream” of the FilAm community still has to be fully realized. Compared to national organizations of other minorities in the US, NaFFAA still has much to learn. It has failed to persuade other major FilAm groups, like doctors, nurses, lawyers, accountants, engineers, and other professionals who proliferate in America, to join the federation. It has also failed to attract corporate promotional and advertising funds, befitting a national federation.
FilAms have also failed to see one of our own win a seat in the US Senate or the House of Representatives. In California, which accounts for half of the four million-plus Pinoys in America, only one our own, Rob Bonta, has won a seat in the state assembly.
Now comes the disconcerting news. Perhaps discouraged by the non-involvement of the other major associations, the current leaders of NaFFAA are reportedly planning to convert the federation from an association of associations into just an organization independent of and different from the rest and not representing them. If this happens, there will be even more reason for the wielders of power in America to ignore our community.
It seems that the current leaders of NaFFAA are giving up on the dream of one unified, dynamic and influential federation and are conceding that it is impossible to achieve. The late Alex Esclamado would have vehemently disagreed.
But Esclamado is gone and it seems that the Don Quixotes in the community either have not yet been born, or hesitate to emerge, or are already riding off into the sunset.
 
Greg B. Macabenta is an advertising and communications man shuttling between San Francisco and Manila and providing unique insights on issues from both perspectives.
gregmacabenta@hotmail.com

Doing the rounds

By Tony Samson
ONE CORPORATE RITUAL that is enshrined in the calendar of a CEO is the accommodation of a useless meeting. The appointment is done months in advance, as it usually involves travel and an accompanying jet lag. This unnecessary activity of doing the rounds is nonetheless accommodated even by the busiest CEO, including the top guy in the Palace, when he is in town.
The courtesy call has no stated agenda except the meeting taking place. Nothing formal is expected to be discussed, debated, or even mentioned. There is no presentation to be made and at the end of the meeting, there are no recall notes to be submitted. There is no expectation of a follow-up for new business or a difficult negotiation in the horizon.
The courtesy meeting is an end by itself. No practical alternative is offered to the physical visit — can’t we just e-mail “hi” to each other?
All sorts of changes trigger off a courtesy call.
A new chief executive is installed. Major service-providers doing business with the company (and the old chief who was ousted or retired), including international banks and suppliers who are nervous about getting paid, want to see the newly designated chief and evaluate how to move forward with him and who the new players are in the inevitable reorganization. Often, the secretary is the same.
Courtesy visits follow a certain routine.
An appointment is booked three months in advance coinciding with a foreign visitor’s travel plans, usually taking place when it is the dead of winter in his home country. The visitor (usually with a small entourage which may include a stunning Executive Assistant, also known as a “traveling companion,” and introduced as the head of artificial intelligence) appears as scheduled. Calling cards are exchanged. Coffee is served. And interesting topics are discussed such as traffic congestion in Manila and Bangkok (so as not to be too offensive), weather conditions in the visitor’s home country (We have early snowstorms at this time), and an exchange of views on international news, keeping out of insulting the esteemed leader of the visitor’s and host’s countries — do you think oil will settle back to the forties range?
After fifteen minutes, the visitor thanks his host and pleads the need to flee for his next courtesy call. No info is given on the next stop, as it may be the competition. A corporate gift, something useless like a coffee table book on museum art, is left behind. Assurances of future business are made on both sides — is there a washroom nearby?
Then, there is the obligatory photo op to record the non-event and put a tick mark on this CEO visited by the tourist.
Lower-level politicians and bureaucrats handle courtesy calls differently. Meeting people (especially suppliers) are an integral part of their duties and responsibilities. They are the very stuff of politics — a lot of small talk going nowhere, some beating around the bush, and the studious avoidance of contentious subjects like unreceipted fees. (Talk to my Executive Assistant if you need anything.)
When visiting politicians, there is no need to exchange calling cards. The visitor knows who his host is and no contact details are required except if the card is used later for avoiding traffic tickets, although that one needs a handwritten note at the back. If the visitor is forgotten, no damage is done. Favor-seekers do not expect to be remembered anyway. They usually do a good job of later reminding their host who they are, what they need, and the amount of encouragement they can provide.
The visit ends routinely again with picture-taking. If the host is important enough, such a picture is framed and hung in the office — until the photographed host’s term ends and a new picture needs to be posted on the company’s web page, after a new courtesy call is completed.
Courtesy calls are an opportunity to simply converse without watching one’s words and how they may be misinterpreted. If more formal negotiations are required, these can be scheduled for other occasions, maybe dinner with appetizing tapas and loud music in the background to avoid being recorded.
Discourteous calls from either side can sometimes follow and turn out to be more profitable.
 
Tony Samson is Chairman and CEO, TOUCH xda
ar.samson@yahoo.com

Lullabies in prison

By Ethel Mae Reyes
PCIJ Story Project
ILOILO CITY — Until I saw the women’s dormitory of the Iloilo City Jail, I thought that anyone living in a cramped and confined space for years would be like a caged animal — vicious and violent. I was wrong.
In the past months, I have been filming in the jail and getting to know the inmates. Imagine more than 220 women packed like sardines in just 133 square meters of space. That’s about half a square meter of floor space for each one.
Nearly all the women in the jail have been accused of drug-related crimes. Except for two who have been convicted, they are all awaiting trial in the city’s slow-moving and understaffed court system. According to a jail official, women stay there an average of five years because court dockets are packed and there are not enough prosecutors. Some had been detained 10 years before being sentenced.
Many of the inmates are mothers who long for their children. What struck me was how they kept their dignity and humanity. They were gracious and generous. They were also neat and well-groomed. Some did regular manicures and pedicures. They were wearing makeup when I filmed them.
Leda, a 41-year-old mother of three children, has been in jail for six years. “When I first arrived in jail, I thought that it was just a dream,” she told me. “I had difficulty sleeping at night since it’s so crowded. In my cell, there are 50 inmates and at night, most of the inmates sleep on the floor. Those who can’t sleep at night usually sleep at noontime. All of us share only one comfort room which has a single toilet and large water drum for bathing. My family rarely visits me since they were busy, but we still communicate by phone. There is not a minute when I don’t miss my kids. I pray that my case will be resolved soon so I can be reunited with them.”

“I have to wake up at 3:30 a.m. to take a bath since that’s the only time I can use the bathroom without disturbance,” said Lila, aged 33, who has been in jail for two years. “ I’ll dry my hair and then I’ll go back to sleep. I would wake up at 7 a.m. for a religious activity and at 8 a.m. there would be a headcount, then we would go back to our cell. The daily visitation hours is from 1 p.m. to 5 p.m., but it does not apply to me since I don’t have any visitors since my family is based in Manila. It’s not worth it for them to come and visit me. Life in prison is not easy, all that stress and being far away from my family is taking a toll on me, but I’m trying my best to cope.”
The Iloilo women’s jail is right in the heart of the city, tucked away in the compound of the police headquarters on busy Gen. Luna Street, right across the bustling University of San Agustin. The jail was built for 28 inmates, but since 2002, when Congress passed a new law raising the penalties for drug crimes, the number of those jailed for drug crimes has risen, resulting in overcrowded jails throughout the country. When the Duterte administration cracked down on drug crimes and detained tens of thousands more, jails all around the country have become so crowded that in many of them, inmates take turns sleeping or sleep sitting down.
The online version of this piece features a video telling the stories of the women of Iloilo jail. Their ages range from 18 to 69, although most of them are mothers with young children. Their identities are concealed to protect their families whom they love and miss.
I focused on the Hilway Art Project, which provides 150 women inmates opportunities for livelihood and art therapy. The women make what they call “Inday dolls” out of fabric. Each doll comes with a favorite quote chosen by the maker and they are sold in trade fairs, popup shops and online through Facebook.
Leda says the project has become part of the women’s lives. “It helped us a lot in our financial needs since most of us are mothers and we are still supporting our children’s needs. We have learned a lot in this project and it has helped us with our talent and skills. The Hilway project has helped us become better persons.”
 
Ethel Mae Reyes is a filmmaker and educator. She currently teaches at the Fine Arts Department of the University of San Agustin in Iloilo City. She produced a video with a grant from the PCIJ Story Project.

Picking up the pace:Mitsubishi Motors updates Triton/Strada pickup in bid to boost global sales


SOUTHEAST Asia remains the single biggest destination for Mitsubishi Motors Corporation’s (MMC) global vehicle deliveries as the region took in 152,000 units during the first half of the 2018 fiscal year, according to an official company report released on Nov. 6. The figure makes up 25.6% of the car maker’s 594,000-unit global sales volume during the same six-month stretch.
MMC sold 1.1 million vehicles globally in fiscal year 2017.
MMC also saw its strongest growth results in the region as first-half sales in Southeast Asia increased 36% year-on-year, outpacing those in Europe and Russia — 29% up, with 112,000 units sold — and in China, whose 82,000-unit tally represents a 19% uptick. MMC’s China results match the company’s global performance during the same period.
Among Southeast Asian countries, MMC, in the same report, credited the “strong sales” of the Mitsubishi Xpander MPV in Indonesia (the model was released in Indonesia in 2017, and is also built there), and that of the Triton pickup truck, “predominantly in Thailand,” for the company’s improvement in the region.
Clearly, then, the Triton is a key product for Mitsubishi. And so MMC holding a global premiere on Nov. 9 in Bangkok, Thailand — the pickup is produced in Mitsubishi’s Laem Chabang plant in Thailand — for what is essentially an upgraded model, rather than an all-new one, can be expected. A lot rides on this pickup’s bed.
As MMC chief executive officer Osamu Masuko said during the latest Triton’s launch program, the model is the “solid foundation on which we will grow our business in Thailand, the ASEAN region and the world.”
He added the truck’s “success will accelerate the momentum of the company’s sustainable growth.”
The development is as significant to the Philippines (where it is sold as the Strada); the country is among the leading consumers globally of this one-ton pickup model.
MMC general manager for global pickup promotion office Koichi Namiki, in a presentation during the world reveal, also stressed the Triton’s importance: “This is a vehicle we export to 150 countries, and produce 160,000 units [of] per year. It is our second-largest selling product and the backbone of Mitsubishi Motors.”
Following the global reveal, the Triton went on sale in Thailand starting Nov. 17. It will be introduced next to other Southeast Asian countries, then to markets in Oceania, the Middle East, Europe, Africa and Latin America (that journalists from Mexico and Chile were present at the Bangkok launch program already bared two markets in the region which will get the revised Triton). The Philippines is set to start selling the model in the first quarter of 2019.
CHANGES
In developing the latest Triton, Mr. Namiki said MMC sales and service personnel, as well as engineers, first sought feedback from the model’s users, with their responses then given to the company’s product development team. The executive continued that any new Mitsubishi model should always be an improvement over the one in replaces.
“It is not enough to develop a new model just to pass the technical standards or test criteria…. That’s the way we’ve been working to meet and exceed our customers’ expectations.”
Mr. Namiki said buyers of pickup trucks these days “expect features found in passenger cars,” noting the behavior is becoming “more popular even among business users who are… in the vehicle most of the day.”
So the Triton sees slight changes to its cabin. A new trim frames the switchgear panel and air vents, and a soft, padded material with contrasting stitching lines the console, armrests and parking brake lever. More important, a six-speed automatic transmission replaces the current five-speed gearbox, promising a more refined operation due to smoother shifts and quicker acceleration. The pickup’s ride quality should also improve with the use of larger dampers, containing more fluid, in the rear (larger capacity dampers benefit both shock absorption and rebound whether the truck’s bed is empty or laden).
But the most visible change made to the Triton is its front-end styling. The model now adheres to the corporate “Dynamic Shield” design language, meaning it closely resembles the Montero Sport that’s based on it, as well as the Xpander. The Triton’s hood line has been raised, along with the narrower and more angular lamps and grille. Another set of lights cluster within large cavities flanking a prominent opening below the grille.
The front end’s sculpted contours are matched at the sides by angular fenders and wheel cutouts, as well as by pronounced character lines that slash across the top of the front genders and the pickup bed’s exterior walls. The truck’s edgy greenhouse shape is unchanged, but the tailgate, rear lamps and bumper have all turned plainer looking.
SIBLING RIVALRY?
As a part of the Renault-Nissan-Mitsubishi Alliance (since 2017, a year after Nissan Motor acquired a 34% stake in Mitsubishi), MMC said its development of its products — especially those competing against Renault’s and Nissan’s in the same segments; the Triton against the Nissan Navara, for instance — remains largely independent from the group. This, even if the three car makers take advantage of each one’s strengths.
“Products can be based on an Alliance platform,” said MMC senior vice-president Guillaume Cartier during a news conference preceding the Triton’s global debut. “But there is no cross-branding.”
Cross-branding refers to identical models sold by different car makers as their own, despite minimal changes made to the vehicles.
Regarding intra-group competition, Mr. Cartier likened the situation to motor racing; “There are no team orders.”
MMC chief operating officer Trevor Mann noted; “It’s an advantage for Renault, Nissan and Mitsubishi to have different technologies so customers can pick what fits them.”
Mr. Cartier added that pickups are a “key expertise of Mitsubishi.”
In a meeting with journalists held at MMC’s Tokyo, Japan, headquarters exactly a year ago on the day the new Triton was launched in Bangkok, Mr. Masuko explained the Alliance, as the case has always been between Nissan and Renault, will “respect” each company’s brand history and management autonomy, separating each one’s marketing and sales efforts while aiming for “greater synergy impact” in financial management, parts procurement, vehicle platform and advanced technology development, and other areas.
“It’s best if we can ‘commonize’ platforms, centralize procurement, and develop new technologies,” Mr. Masuko said.
The Alliance, the executive stressed, also puts the group in a “well-balanced” position worldwide as each company enjoys a strong presence in different markets, citing that “Nissan is strong in North America, Renault in Europe, and Mitsubishi in Southeast Asia.” — Brian M. Afuang

World’s fastest SUV now in Manila

THIS sport-ute can sprint from a standstill to 100kph in 3,6 seconds, to 200kph in 12.8 seconds, and on to a top speed of 305kph. It is currently the world’s fastest production SUV. It is the Lamborghini Urus. Last week, it was launched in the Philippines.
“The Lamborghini Urus is a model that’s born out of Lamborghini’s vision to continually defy boundaries and, with it, the desire to create the world’s first super SUV. We are very proud to bring this groundbreaking car to the Philippines,” said Roberto T. Coyiuto III, president and CEO of Lamborghini Manila.
The Urus was unveiled locally at a Parañaque City hotel and entertainment complex on Nov. 13. Besides Mr. Coyiuto, the grand launch program was led by PGA Cars chairman Robert G. Coyiuto, Jr., and Lamborghini Sales Director Davide Sfrecola.
Named MVP SUV in Robb Report’s Best of the Best 2018 awards — the magazine described the SUV as having combined the elements of the Lamborghini Huracan Performante and Aventador S — the Urus is pitched as having elevated the SUV to a level not previously possible. The Urus is powered by a 4.0-liter V8 twin-turbo engine that makes 650hp at 6,000rpm and 850Nm from 2,250rpm. This allows the car a weight-to-power ratio of 3.38 kilogram-per-horsepower — the best in its class.

Lamborghini Urus 2
Cabin of Urus fuses Italian craftsmanship with advanced technology.

Immediately identifiable as a Lamborghini, the Urus is marked by a cutting-edge, streamlined design that is at once sporty, elegant and outdoorsy. Lamborghini details and iconic shapes abound in the model, chief among which are the “Y” and the hexagon elements, the hood with a center peak, and the cross lines on rear panel. Its proportions also make it unique in the segment where it belongs — it is the lowest-slung SUV ever, even if boasting ample ground clearance.
The Urus’s cabin fuses Italian craftsmanship with advanced technology. As a Lamborghini, its instrument panel remains aeronautic in theme, and boasts three TFT screens. The dashboard follows the “Y” theme inspired by iconic Lamborghini models. A selection of colors and materials, such as natural leather, Alcantara, wood, aluminum or carbon-fiber are available for customization. Plus, the Urus can seat five.
As a Lamborghini SUV, the Urus takes its design inspiration from the LM002 (built from 1986 to 1993), particularly the “Lambo Rambo’s” power dome on its hood, as well as diagonal lines over the wheel arches. The frameless doors, meanwhile, recall those on some of Marcello Gandini’s creations for Lamborghini.
The Urus is now available at the Lamborghini Manila showroom.

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