Facebook Instagram Linkedin Twitter Youtube
Home Blog Page 11251

Rice tariff bill hurdles House on third reading

A RICE STORE in Kamuning Market, Quezon City. — PHILSTAR/ MICHAEL VARCAS

THE House of Representatives passed on third and final reading on Tuesday House Bill 7735, or the “Revised Agricultural Tariffication Act.”
The vote was 200 for, 7 against with two abstentions.
The bill liberalizes private imports of rice in exchange for tariffs, collections from which will create a fund that will improve the competitiveness of the domestic rice industry.
Akbayan Representative Tomasito S. Villarin, who abstained, said: Tariffication alone will not address problems persistently besetting the farming sector.
He added: “It does not guarantee that small rice farmers will ultimately benefit from it nor can they participate in setting policies for the fund.”
He noted the bill should go with the passage of a national land use policy, a ban on land conversions, and the provision of direct farm subsidies.
The bill allows the State to “use of tariffs in lieu of non-tariff import restrictions to protect local producers of agricultural products.”
If enacted, the minimum access volume (MAV) on rice will revert to its 2012 level of 350,000 metric tons (MT) as per Philippine commitments to the World Trade Organization (WTO).
The bound rate for rice import will be set at a 40% Most Favored Nation rate from non-ASEAN WTO-members within the 350,000 MT MAV. Beyond the quota, the tariff is 180% MFN.
Rice imports from ASEAN member countries will be levied duties in accordance with the ASEAN Trade in Goods Agreement.
The National Food Authority is authorized to establish rules governing the rice and corn trade and the collection of corresponding fees and charges.
The measure also gives the president power to make adjustments in the applied rate, or regulate rice exports.
The legislation is a priority measure as certified by the Legislative-Executive Development Advisory Council.
Its counterpart measure, Senate Bill 1839, authored by Senator Sherwin T. Gatchalian, is still pending at the committee level. — Charmaine A. Tadalan

Budget dep’t asked to allocate funds to farmers before rice tariffs set in

rice grains
FARMERS dry unmilled rice grains along the road in Pulilan, Bulacan. — PHILSTAR/KRIZ JOHN ROSALES

SENATOR Cynthia A. Villar, who chairs the chamber’s Committee on Agriculture and Food, has requested that the Department of Budget and Management allocate additional funds for rice farmers until the rice competitiveness enhancement fund (RCEF) takes effect.
Speaking to reporters on Tuesday, Ms. Villar said that she asked Budget Secretary Benjamin E. Diokno to set aside P10 billion annually for rice farmers until the tariff collected from imported rice is put to use to boost the productivity of domestic rice farmers.
“I’m telling the DBM secretary he has to provide that for this budget for next year. He should anticipate it […] because even with the tariff, it will not be enough [to support the farmers],” she added.
“The RCEF should come from the tariff but the tariff is still up in the air so they should just give P10 billion while the tariff isn’t there. But once it’s here, the tariff will be used.”
The RCEF is a proposal under the House Bill 7735, or the Revised Agricultural Tariffication Act, which will remove the quantitative restriction on rice imports in exchange for higher tariffs.
The bill also seeks to restore the minimum access volume of 350,000 metric tons, which was last imposed in 2012, at a 40% tariff rate. Any volume above this will be levied a 180% rate.
The fund will be used to further improve the capacity of rice farmers through mechanization, scholarships, and extension services.
Ms. Villar said that the bill, which passed on second reading in the House of Representatives last week, is set to be passed as soon as possible “because we’ll be penalised by November if we didn’t liberalize.”
The Senate version, on the other hand, has not yet cleared the committee.
“It’s so hard to pass a bill that… won’t help the farmers. So we have to be very careful in what we provide in the bill to make sure that the farmers will become competitive and profitable,” Ms. Villar said.
“Or else they’ll be on the losing end again,” she added. — Anna Gabriela A. Mogato

Tax amnesty package stalls in committee on LGU worries

COMMITTEE approval for Package 1B of the Tax Reform for Acceleration and Inclusion (TRAIN) law has stalled over questions about who controls the proceeds when amnesties are declared on local taxes.
Quirino Rep. Dakila Carlo E. Cua said on Tuesday that the Ways and Means committee will need at least one more hearing to “iron out the concerns of the Bureau of Customs (BoC) and local governments.”
League of Provinces Director Angelica J. Sanchez claimed that the provisions go against the principle of local autonomy.
“I do not think that imposing a local tax amnesty would really answer… the problem of the local government units,” Ms. Sanchez said, noting that in particular she is concerned over the use of the proceeds.
“We only have one basic local tax, that’s the real (property) tax, and what we’re collecting is not really that large… but, if you grant the real (property) tax amnesty this is not going to help the provinces,” she added.
Mr. Cua said that the panel is consulting on the matter with local officials.
“We want a consultation with local officials because it affects them but any collections from the amnesty regarding local taxes should go to local governments,” Mr. Cua said.
Finance Assistant Secretary Mark Dennis Y.C. Joven also urged that a tax amnesty for unpaid customs duties, internal revenue taxes and local government taxes be separated from the package.
The tax amnesty package consisted of an estate tax amnesty, a general tax amnesty, a tax amnesty on delinquencies, an amnesty on customs duties and taxes collected by the Bureau of Customs, a real property tax amnesty and a local business tax amnesty.
“We propose that we just split up the one proposed and separately (file a bill) for customs duties and internal revenue taxes collected by the BoC and for the third type for local government-collected taxes,” Mr. Joven said.
He explained that the three types of taxes are collected by separate entities, making it difficult to “create a single consolidated database.”
BoC lawyer Karen Anne Yambao said the measure imposes an amnesty even on cases with pending seizure proceedings, which she said are “subject to criminal charges.”
“The provisions would allow unlawful importation and allow those who practice unlawful importation to find amnesty,” she said. — Charmaine A. Tadalan

Euro 2 diesel to go back on sale as measure to keep inflation in check

THE Department of Energy (DoE) has directed to oil companies to start selling diesel compliant with the Euro 2 standard, a step backward from previous moves to shift to the newer Euro 4, as an inflation-control measure.
In a press conference on Tuesday, Energy Undersecretary Felix Wiliam B. Fuentebella said the rising prices of commodities prompted the DoE’s order.
“We have a bigger problem to address… inflation,” he said.
He said DoE Secretary Alfonso G. Cusi instructed the department to study options to lower commodity prices after the Office of the President pressed government agencies to address inflation.
He said the Euro 2 “option” does not violate health and environmental standards and gives consumers the choice to buy lower-cost diesel while helping the economy through the reduction of fuel prices by around P0.28 to P0.30 per liter.
“Just by opening up that option, they will have to compete,” Mr. Fuentebella said in introducing Department Order DO2018- 08-0012.
“Competition will require them to do that because we’re adding another item to the menu,” he added.
The DoE order states that the issuance is authorized by Republic Act No. 8479 or the Downstream Oil Deregulation Law, and RA 8749 or the Philippine Clean Air Act. He said the DoE sat down with the Department of Environment and Natural Resources (DENR) to discuss the DoE’s planned issuance.
“(DENR’s) statement is to study it further probably because of emission standards,” he said.
He declined to say until when the department order will be in place and whether its effectivity is dependent on the government reaching a specific inflation rate, but he said the expected fuel cost reduction “is not negligible.”
“It has an impact on consumers,” he said, adding that public transport vehicles will be the biggest beneficiaries of the department’s move.
Mr. Fuentebella said the DoE consulted oil companies on the issuance.
“Some of the players are positive about it, some would like to clarify,” he said.
For now, there will be no sanction on oil companies that do not comply with the directive.
“[The] sanction is, consumers might not buy from you. The oil companies will have to adjust to the market,” he said.
During the past administration, the DoE set Jan. 1, 2016 as the deadline for oil companies to upgrade to cleaner emission standards of fuel from Euro 2 to Euro 4, a globally accepted emission standard for vehicles.
Euro 4 requires the use of fuel with a significantly low sulfur content of 0.005% or 50 parts per million, and benzene content at a maximum of 1%. Euro 2 fuels have up to 0.05% sulfur or 500 parts per million and up to 5% benzene.
Senator Sherwin T. Gatchalian, the Senate energy committee chair, asked whether the use of Euro 2 is compliant with the law. Many countries have even banned the fuel, he added.
“I know the Clean Air Act is already banning this type of dirty fuel. In fact, many tricycles have been made to convert to Euro 4. But going back to Euro 2 we might have a problem,” he said.
“We will have to study first if it is a violation of the Clean Air Act. If so, then we will need to be enlightened because instead of moving forward to cleaner fuels, we’re moving backward to dirtier fuels. We also have to weigh the 30 centavo price cut, but the externalities like health and respiratory illness might be… compromised. This must be studied well,” he said. — Victor V. Saulon

Consumers becoming more aware of their social influence — Havas

inflation shopping
93% of the 251 respondents feel a sense of responsibility in exercising their consumption power — “Emerging Shifts in Filipino Consumption Mind-sets” — BW FILE PHOTO

FILIPINO consumers are becoming more aware of how their purchasing power can influence companies and promote products and ways of doing business that they support, a media communications company said, citing the results of a study.
Havas Ortega Group said its study, “Emerging Shifts in Filipino Consumption Mind-sets,” which surveyed 251 respondents, indicates that 93% feel a sense of responsibility in exercising their consumption power.
The shift comes in the context of a boarder movement from being a passive consumer to a so-called prosumer, one who also serves as an advocate for products or ways of doing business.
In a briefing in Makati City, the company’s head of data analytics Philip V. Tiongson said this means “There is going to be a shift which will see us moving from mindless consumption… into what we can only call meaningful consumption,” he said.
He added that this shift in behavior has been influenced by technological changes over the past 15 years which allowed people to find their voice through social media and the Internet.
“Technology has empowered us and emboldened us to speak our minds and take a stand on things that are important to us,” he said.
The report identified six key attitudes that have emerged from the study: seeking personal growth via the products purchased; patronizing only companies whose values they identify with; a preference for local products supporting fellow Filipinos; the favoring of products that minimize their ecological footprint; a renewed focus on functional, utilitarian products; and a peaceful shopping experience.
Mr. Tiongson said companies must start recognizing that there is now a “new Filipino consumer that is emerging…(one) that has new and unprecedented needs.”
The study found that 49% of respondents think they have more influence as consumers than as voters, and that 60% make purchasing decisions based on a producer’s values or political and social activities.
Mr. Tiongson noted certain boycott campaigns against brands, which he considers a recent phenomenon “because consumers are beginning to be more aware of their responsibilities.”
He noted that this amounted to consumers voting with their wallets, which may become standard in the future. — Denise A. Valdez

Peso declines on risk-off mood

THE PESO slipped further against the dollar on Tuesday due to continued risk-off sentiment in the market due to concerns over the Turkish economy.
The local unit closed Tuesday’s session at P53.39 versus the greenback, two centavos weaker than the P53.37-per-dollar finish on Monday. This is the peso’s weakest closing rate in nearly three weeks since it closed at P53.435 against its US counterpart on July 26.
The peso traded weaker the whole day, opening the session at P53.50 per dollar. It slid to an intraday low of P53.51, while its best showing for the day was its closing rate.
Dollars traded declined to $693 million from the $786.4 million that switched hands the previous day.
A trader said on Tuesday that the peso continued to weaken as fears about the Turkish economy caused investors to be cautious.
“The local currency still closed weaker as Turkey contagion fears persistently put some risk-off sentiment in the [foreign exchange] markets,” the trader said in an e-mail.
Reuters reported that the Turkish lira tumbled to a record low, weakening as much as 13.34%, over concerns about Turkish President Tayyip Erdogan’s rigid control over the economy fuelled further by worsening relations with the United States.
Mr. Erdogan, who has called himself the “enemy of interest rates,” wants cheap credit from banks to fuel growth, sparking concerns that the economy might overheat and could be set for a hard landing.
To quell concerns, the Turkish central bank pledged to provide liquidity by cutting currency reserve requirements for domestic banks to free up $6 billion and additional $3 bullion equivalent of gold liquidity into the financial system.
“However, it must be noted that as the peso [weakened] in the open, investors started taking profits on the dollar’s strength in the intraday trade,” the trader said.
Still, UnionBank of the Philippines Chief Economist Ruben Carlo O. Asuncion noted that emerging market currencies were still “stronger” across the board following the Turkey fallout on Monday.
For Wednesday, the trader expects the peso to move between P53.25 and P53.45 versus the dollar, while Mr. Asuncion gave a P53.20-P53.50 forecast range.
“The peso will likely strengthen [on Wednesday] as US retail sales and industrial production data might come mixed from previous readings,” the trader noted. — K.A.N. Vidal with Reuters

Stocks extend decline on lingering uncertainties

STOCKS posted losses on Tuesday amid continued fears of a spillover of the Turkish lira crisis.
The bellwether Philippine Stock Exchange index (PSEi) fell 1.4% or 107.49 points Tuesday, August 14, to close at 7,527.78. The broader all-shares index also declined by 1.15% or 53.61 points to 4,578.92.
“The local market continued to slump, influenced again from the Turkey contagion and continued its second consecutive day of a massive drop-off,” Regina Capital Development Corp. Managing Director Luis A. Limlingan said in a mobile phone message on Tuesday.
Turkey’s central bank has rolled out an emergency plan to ensure economic stability as the lira opened the week slumping to new record lows. The measures include providing “all the liquidity the banks need” and continuous monitoring of the situation.
Meanwhile, the meeting between US National Security Advisor John R. Bolton and Turkish Ambassador to the US Serdar Kilic yielded news of the possible release of the detained American pastor.
“This news gave some support to the market. [The Turkish lira] tried to recover earlier losses but failed,” Mr. Limlingan added, noting that the decline across the US stocks also aggravated the situation.
US stocks dropped on Monday as global jitters from Turkey’s plummeting currency spread to Wall Street, with the S&P 500 and the Dow falling for the fourth session in a row.
The Dow Jones Industrial Average fell 125.44 points or 0.5% to 25,187.70; the S&P 500 lost 11.35 points or 0.4% to 2,821.93; and the Nasdaq Composite dropped 19.40 points or 0.25% to 7,819.71.
For his part, Jervin S. de Celis, trader at Timson Securities, Inc., said the increase in Chinese firms in the MSCI World Index also contributed in the market’s movement.
“Since the MSCI index is an important index of fundamentally sound stocks for investors, the addition of new “choice” to invest in may have urged investors to shift funds to the new entries,” Mr. De Celis said in a mobile message on Tuesday.
The MSCI is a broad global equity index that covers large and mid-cap equity performance across 23 developed markets.
Back home, all sector counters declined on Tuesday.
Property saw the biggest losses, shedding 1.92% or 72.62 points to close at 3,705.64; mining and oil slid 1.79% or 183.57 points to 10,058.91; financials fell 1.67% or 30.77 points to 1,801.89; holding firms lost 1.28% or 96.33 points to 7,409.36; services dropped 1.1% or 16.8 points to 1,504.67; and industrials went down 0.44% or 49.31 points to finish the session at 10,950.44.
Losers outnumbered advancers, 141 to 60, while 41 issues were unchanged.
Value turnover reached P5.31 billion as 1.34 billion shares switched hands on Tuesday, up slightly from Monday’s P5.17 billion.
Foreigners continued to dump their shares, logging net sales of P1.47 billion, significantly higher than the P830.21-million net outflow recorded on Monday. — Janina C. Lim with Reuters

DoLE to seek priority status for bill on security of tenure penalizing ‘endo’

THE Department of Labor and Employment (DoLE) said it will seek the certification of the Security of Tenure Bill as a legislative priority.
During a briefing on Tuesday, Secretary Silvestre H. Bello said DoLE is endorsing the bill and has proposed to the Legislative-Executive Development Advisory Council (LEDAC) to certify it as urgent.
He added that during a pre-LEDAC meeting, he pushed for the inclusion of the bill as part of the legislative bodies’ main agenda.
“The decision yesterday during the pre-LEDAC meeting is that we will move to include it in agenda of LEDAC proper,” Mr. Bello said.
In LEDAC’s Common Legislative Agenda (CLA) for the 17th Congress, the bill is considered a priority by the administration but it has yet to be certified as urgent.
The bill, known as Senate Bill 1826, was sponsored by Committee on Labor, Employment and Human Resources Development Chair Joel J. Villanueva.
Despite endorsing SB 1826. Mr. Bello said that he still worries about how it can be implemented.
“You may have the best legislation on the security of tenure but if there’s no capability to implement it, it would be a waste,” he said.
Employers Confederation of the Philippines (ECOP) President Donald G. Dee said by phone on Monday, “We support the bill in general but there are some provisions we have some reservations on.”
Mr. Bello said that the business sector’s reservations center on the P5 million fine for businesses found to be engaged in labor-only contracting activity.
“They don’t like the penalty of P5 million. We think it’s too low,” he said.
The bill also authorizes the DoLE to preventively or permanently shut down operations of labor-only contractors. — Gillian M. Cortez

China’s Stratagem in the Framework Negotiations for a Code of Conduct with ASEAN

AFTER meeting on the sidelines of the ASEAN Regional Forum in Singapore last week, the regional bloc and China announced a breakthrough in the drafting for the framework for a Code of Conduct (COC) in the South China Sea, which would form the basis for future negotiations regarding an eventual COC.
On behalf of ASEAN, Singapore Foreign Minister Vivian Balakrishman announced in a news conference that the 10 ASEAN member states and China “put everything down in a single draft.” He clarified, however, that this “does not mean negotiations are over … [but] it is meant to generate a code of conduct that would ensure peace, stability, confidence so that we can continue to make collective progress.”
For his part, Chinese Foreign Minister Wang Yi admitted that the agreement on the draft was a new and important step for the deliberations on the COC. Barring “external disturbances,” he said, the discussions should move forward.
The idea of a COC could be traced back to the early 1990s with ASEAN member states applying the association’s usual practice of conflict management in dealing with China, which was seen as altering the territorial status quo in the South China Sea. In 2002, ASEAN and China signed the “Declaration on a Code of Conduct (DOC) on the South China Sea,” a political statement of broad principles of behavior aimed at stabilizing the situation in the disputed waters and preventing an accidental outbreak of conflict in the area. After the signing, ASEAN and China were expected to negotiate and adopt a binding COC.
More than a decade after the signing of the DOC, however, the two parties have yet to begin the negotiation for the COC simply because they do not share the same objectives in the South China Sea dispute. While the ten small powers comprising the association prefer a COC that draws China deeper toward the ASEAN process of peaceful consultation and conflict-avoidance, China, as a great power, has neither interest nor inclination to be embedded into and constrained by a diplomatic process created and dominated by small powers.
Driven by its goal to dominate the South China Sea, China supported an incremental approach in which the conclusion of a COC is seen as a long-term rather an immediate goal.
ACCEPTING CHINA’S NAVAL EXPANSION AS NORMAL
In May 2017, China suddenly showed flexibility in dealing with the ASEAN as it announced that it is willing to negotiate on a framework for a COC on the South China Sea.
After claiming 80% of the South China Sea and delaying the negotiation of a COC, China suddenly extended an arm of cooperation with ASEAN. In early August 2018, ASEAN and China agreed on a “Single Draft South China Sea Code of Conduct Negotiating Text (SDNT)” that will be the basis for the negotiation of a COC. In its proposal for cooperation in SDNT, China tabled four proposals for the Promotion of Trust and Confidence between the two parties: a) (the conduct of) military activities in the region (that) shall be conducive to enhancing military trust; b) exchanges between defense and military forces including “mutual port calls of military vessels and joint patrols on a regular basis; c) undertaking of joint military exercises among China and ASEAN member states on a regular basis; and d) the creation of a notification mechanism on military activities if deemed necessary. This means the parties shall not hold joint military exercise with countries from outside the region unless the parties concerned are notified beforehand and express no objections.
The first three exhort ASEAN member states to acknowledge China’s naval power and presence in the South China Sea, in particular, and Southeast Asian waters, in general. They reflect China’s confidence as it was able to complete the construction of artificial islands in the South China Sea, fortify them with air-bases and seaports, and able to militarize without any strategic nor diplomatic cost.
By putting these proposals on the table, China hopes that the ASEAN countries will get used to the deployment of People’s Liberation Army’s Navy (PLAN’s) warships on their horizon, the same way as they have accepted as normal American, Japanese, and Australian naval presence in Southeast Asian waters.
The fourth proposal is intended to give China a veto on the ASEAN member states’ prerogative to hold military exercise with the American, Australian, and Japanese navies in Southeast Asia. If any of the ASEAN states would like to conduct a naval exercise with these countries’ navies, it requires mutual consent from China and the other ASEAN member states.
For Singaporean analyst William Choong, it was clear that “China was attempting to use the COC to reduce the presence of the US Navy and the Australian Navy in the South China Sea.”
WINNING WITHOUT ACTUALLY FIGHTING
This is the context of the latest development in the COC narrative. The Singaporean foreign minister admitted that the draft was “very rough,” as it only included the 11 countries’ “wish lists.” The draft text will be reviewed in meetings in Siem Reap in Cambodia and Manila in the Philippines before it will be formally endorsed by heads of states in the ASEAN summit in October.
However, whether this draft will be the framework of a COC negotiations is still unclear. Hopefully, there will be wiser and smarter heads in the regional association who will comprehend the gist of China`s stratagem in the negotiation for a COC. Otherwise, the ASEAN will be complicit in China’s ruse to win without actually fighting in the South China Sea dispute.
 
Renato Cruz De Castro is a Trustee and Convenor of National Security and East Asian Affairs Program of Stratbase ADR Institute.

Land transport modernization and the bureaucracy


UNTIL five years ago, the Philippines had the lowest registered vehicles ratio per population in the whole of North and Southeast Asia. It only had 79 registered vehicles per 1,000 population.
Indonesia and Vietnam had more than five times that number, Thailand more than six times and Malaysia had ten times more vehicles than the Philippines. Bulk of these countries’ vehicles though are two- and three-wheeled, like motorcycles and tricycles/tuktuk (see table).
These numbers indicate two implications for the Philippines.
One, our numbers were understated because many vehicles here were not registered with the government — LGUs for tricycles and kuligligs, and LTFRB for motorcycles, cars, jeeps, buses, etc.
What does this imply?
Many vehicle owners no longer bother to register their vehicles because doing so involve complicated and expensive procedures involving national and local bureaucracies.
Two, the Philippines has high reliance on limited public transportation — tricycles, jeepneys, buses, UV express, MRT/LRT.

Compare this with Japan, Taiwan, and South Korea.
All these three countries offer convenient rail-based mass transportation but they still have high vehicle to population ratios.
This is probably because vehicle owners aren’t discouraged by lengthy and tedious bureauractic procedures when they register their vehicles.
That situation is far removed from the way the Land Transportation Franchising and Regulatory Board (LTFRB) regulates transport network vehicle services (TNVS) or transport network companies (TNCs).
Last week, the agency reiterated its fare “rationalization and streamlining” TNVSs and TNCs.
As a result, fares which it deems “non-rational” will be disallowed and in the process, innovation and modernization by private players will be discouraged.
Commuters are generally rational people.
Those who choose to ride TNVS are those with specific needs, not the LTFRB officials and bureaucrats who ride in taxpayer-funded vehicles and gasoline/transportation allowance.
No one put a gun to force commuters to ride “expensive” ride-sharing vehicles — they do so because they have specific needs (i.e., they’re either carrying huge amounts of cash, important documents, or equipment or must rush a patient to a hospital emergency).
So when LTFRB continues with its fare control policy like disallowing per minute charging in heavy traffic or flooded streets, they discourage the supply of vehicles in those areas where demand for such transportation is high. LTFRB is the agency to penalize commuters and trap them in those areas.
Also last week, the Philippine Competition Commission (PCC) has approved the Grab-Uber deal but imposed several conditions under “Commitment Decision” with high penalties for any violation.
Among the conditions are:
• service quality, pricing (Grab to bring back market averages for acceptance and cancellation rates before acquiring Uber, penalty up to P2M in routes with extraordinary deviation from minimum allowed fares);
• fare transparency (show breakdown per trip including distance, fare surges, discounts, promo reductions, per-minute waiting);
• removal of “see destination” feature especially for drivers with low ride acceptance rate;
• driver/operator non-exclusivity (Grab will not introduce policy that will prevent drivers and operators from operating with other TNCs);
• improvement plan, particularly to enhance driver performance; adopt drivers’ and passengers’ codes of conduct; establish a Grab driver academy, welfare and rewards programs.
I think the better option for the PCC is to talk to LTFRB, DoTr, SEC, etc. and ask how other big global and regional players like Lyft, Didi, GoJek can come to the Philippines and compete with Grab. Or how to hasten the merger of existing new but small players so that they become big soon and compete with Grab.
If PCC makes the business harder and more bureaucratic for Grab, that is a signal for other big players like Lyft and GoJek to think twice going into the Philippine market. They put big money, time, and resources here and they can be subjected to difficult and bureaucratic conditions like what the LTFRB and PCC are doing to Grab now — why bother to invest here?
Let Grab and new domestic players introduce various innovation in pricing and marketing, show the other big players abroad that if they do business here, government will not over-bureaucratize them. They will be allowed to do many things except to use their accredited vehicles to commit crime or terrorism.
Government should step back from increased fare and price control and allow the customers penalize the abusive and greedy players by boycotting them and move to other bigger, more efficient players.
 
Bienvenido S. Oplas, Jr. is President of Minimal Government Thinkers, a member institute of Economic Freedom Network (EFN) Asia.
minimalgovernment@gmail.com

The problem with federalism — It’s the politicians, stupid!

IF the structure of the Philippine government is supposed to have been patterned after that of the United States, why wasn’t the federal system of America also applied to the Philippines?
The answer is in the fact that the US was created from thirteen colonies that decided to federate, declare independence from Great Britain, fought and won a revolutionary war and subscribed to a single Constitution that acknowledged the autonomy and the partitioning and sharing of powers between the Federal government and the states.
The US nearly became un-united or untied in 1861 when several Southern states, chafing over the issue of slavery and the sharing of authority and power with the central government, declared themselves the Confederate States of America. This precipitated a bloody civil war that ended only with the surrender of the confederacy in 1865.
On the other hand, the Philippines, was considered a single colony of the United States and was never regarded as separate or autonomous provinces or regions. Thus, it was constituted as a Commonwealth of the Philippines, with a central government, preparatory to being granted independence.
No thanks to Malacañang’s resident communications genius, Mocha Uson, our citizens are still unsure what the heck the Philippine Legislature and President Rodrigo Duterte are talking about in the course of their campaign to replace the current centralized system of government with a federal system.
Proponents of federalism are, understandably, focusing on the benefits of this system of government, which is in use by several countries, among them the US, Canada, Germany, Switzerland, Australia, Russia, Mexico, Argentina, Brazil and, in Asia, Malaysia, India, and Pakistan.
On the other hand, those who are resisting federalism have expressed both valid reasons, as well as concerns that come with fear of the unknown. Among those who have posed reasonable concerns are Duterte’s economic czars, Finance Secretary Carlos Dominguez and Socioeconomic Planning Secretary Ernesto Pernia.
But the fear of the unknown is, perhaps, the biggest obstacle to public acceptance of federalism. This is exacerbated by what people already know about the actuations of those who may eventually be entrusted with implementing the change of governmental system.
The fact alone that certain politicians are calling for the scalp of Dominguez and Pernia, for expressing their reservations about federalism, is one principle reason to fear its implementation.
Said our neighborhood tricycle driver in Parañaque: “Hindi pa nga na-a-aprubahan ang pederalismo, umaabuso na ang mga gago!” (Federalism has not yet been approved, those idiots are already becoming abusive)
Said one of his passengers: “Sa totoo lang, mapagkakatiwalaan mo ba ang mga katulad ni (former Speaker Pantaleon) Alvarez at (former Majority Floor Leader Rodolfo) Fariñas na hindi maghahari-harian sa kanya-kanyang teritoryo? Kung sa kasalukuyang sistema, abusado na. Di lalo na kung autonomous na sila?” (In truth, can you trust people like Alvarez and Fariñas not to lord it over their respective territories? Under the present system, they have already been abusive. What more if they become autonomous?)
Chimed in another passenger: “Hindi lamang si Alvarez at Fariñas. Lahat ng politiko.” (Not just Alvarez and Fariñas. All the politicians.)
To be blunt about it, the problem is not the concept of a federal system of government. It’s the politicians, stupid!
Following are some of the ways political overlords can — frankly, WILL — abuse their newly gained autonomy under a federal system:
1. Multiplying, overlayering, and overloading the bureaucracy — Everyone who has managed a company must be familiar with this dynamic. When you promote an assistant, he will ask for an assistant for himself. Soon, he will promote his assistant who will then want his own assistant, and so on. Apply that dynamic to a change from a centralized system of government to a federal system and you can bet that the tendency to multiply departments and overlayer and overload them will manifest itself. I believe Sonny Dominguez has a much bigger fear as applied to government expenditures.
2. Control over the system of justice — We have all witnessed how Alvarez, as House Speaker, threatened to DISSOLVE the Court of Appeals and to have several justices disbarred over a decision by the justices involving six Ilocos Norte officials. We have also witnessed how Duterte and the Legislature have virtually placed the Supreme Court under their thumb and how they succeeded in dislodging Chief Justice Lourdes Sereno. In a federal system, this abuse of power will surely happen as sure as night follows day.
3. Private armies and the imposition of a virtual police state — Duterte’s war on drugs will be replicated at the local level with a war against anything and anyone who dares to protest abuse of authority. If, under the spotlight of international condemnation, the thousands who have been salvaged by the police still have not found justice, does anyone believe localized salvaging and disappearances will fare any better? At present, private armies are being maintained by political overlords. Federalism WILL formalize their existence.
4. Imposition of punitive and frivolous taxes and business regulations — This is already happening even under the present system of government. A federal system will simply make the situation worse.
5. Wholesale graft, corruption, and raiding of the treasury — The Commission on Audit has been rendered toothless in its efforts to extract accountability from national and local officials, starting from charging for ghost employees (which the Dutertes have been questioned about) to overpricing on public works projects and official purchases of materials and supplies. Autonomy will give the green light for raiding the treasury of each region.
6. The danger of secession — The Confederate States of America that the Southern states in the US attempted to establish should serve as a warning to those who still do not know how to handle the Moro secessionist sword of Damocles. In this regard, watch out for the Federation of Malaysia. It may be tempted to offer to include parts of Mindanao in the federation, given a chance. Remember Sabah!
The capacity for stealing and abuse of power by local politicians is a known fact under the present system — the only difference is that there is a capo di tutti capi who sits in Malacañang, holds the purse strings and is commander-in-chief of the armed forces.
Federalism will simply create more capo di tutti capi, just like amoebas and just like the Mafia, lording it over their respective domains. The powers of the man in Malacañang will presumably be decreased as those of the autonomous regions are officially granted.
You can almost see the proponents of federalism salivating over the powers that they will officially enjoy.
Frankly, at present, some of them are already enjoying similar powers but unofficially — thus, the sick joke is that there already exists a Kingdom of Ilokandia, a Kingdom of Leyte, a Kingdom of Cebu and several kingdoms in Mindanao.
In spite of all these dangers, there are very real benefits to be gained in a federal system of government. Ask the many countries that have flourished under the system.
But the devil is in the details. And the devils are the politicians.
 
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

The urge to compare

By Tony Samson
FINANCIAL ANALYSTS routinely evaluate current corporate performance by comparing it with that of the previous period. Thus a listed stock that briefs investors and analysts on net income need to state how it compares year on year, whether flat, down, or up and by how much. It is not enough to make billions of pesos in net income for the quarter, the number has to be set against the quarter or year before. It is even compared to the anticipated number. All these comparisons can make even awesome numbers disappointing when paired against last year.
Implicitly, this financial approach of comparative analysis require results to always be improving. And to be impressive and deserving of additional credit or a higher stock target prices (buy and accumulate), the growth has to be in double-digit territory. Economic indicators too are compared year on year, GDP, international reserves, inflation, and even favorable ratings of surveys which may differ in the same period.
Comparisons in business and the economy are usually quantitative. Only attributes that are measurable in numbers can be compared. And even these have to be symmetrical — you can’t compare apples to oranges, except in a fruit salad.
Even leadership styles depend on metrics. The sterling attributes of leadership are bestowed on those at the helm of companies that are growing and profitable, or acquiring culinary schools and delivery systems at a fast clip. Former high-flying stars brought down by slumping revenues and shrinking market shares are portrayed negatively as their numbers decline — he needs a succession plan.
Sports, often like business, deals with comparisons all the time. The Olympic motto is, after all, “faster, higher, stronger.” In any sports event, it is this comparison of performance that determines the medal standing. Even winners of Olympic events need to compare with previous winners to make their achievements more meaningful, by setting new records or breaking old ones; not just faster, but the fastest ever.
The urge to compare extends to social status. Status symbols, like a Birken bag, or an upscale neighborhood, simplifies this comparison game of who is richer. Basketball players in the professional league in the States get to know what others are getting in their highly publicized contracts to serve as the pecking order for status envy. A twice awarded MVP, Steph Curry had to carry on with a contract financially worse than a hundred other players, including some in his own team until this year he got his much deserved stratospheric contract. In that time of middling pay, he simply shrugged off his financial neglect. He wasn’t worried about mediocre players getting more — “anyway, I can’t spend their money.”
Behavioral economics cites the irrational effects of “framing.” A purchasing decision is not done in isolation. The desirability of an item on sale is affected by its previous price. A 70% promo discount makes an otherwise uncontemplated purchase of a bomber jacket seems compelling, only because of the posted saving regardless of the absolute amount. This same framing context affects satisfaction with a performance bonus. A bonus of five million pesos may send one executive jumping with joy, until he finds out that another less worthy executive got twice that amount. Thus comparisons, as the philosopher Søren Kierkegaard points out, can be odious. They introduce envy or a feeling of undeserved superiority.
A person comparing his previously glorious lifestyle and career to his present fallen state can be seized by depression — how much better the past was! Looking back even to miserable days does not help. One is always told to move on and not keep comparing with the past or with those doing much better. It’s a competition that can’t be won.
Comparison should not necessarily lead to competition. There are anyway attributes that are not usually compared, like good health and happiness.
Poets understand comparisons better. They use metaphors for feelings. Shakespeare’s sonnet 18: “Shall I compare thee to a summer’s day? Thou art more lovely and more temperate.” There’s no competition here. It’s just a person not under the weather.
The urge to compare is best left checked. It’s not necessary to be better, just to be good. Most times, good is wonderful enough.
 
Tony Samson is Chaiman and CEO, TOUCH xda
ar.samson@yahoo.com

1...11,25011,25111,252...13,373Page 11,251 of 13,373
© 2024 BusinessWorld Publishing.
All rights reserved.
Read our privacy guidelines
Facebook Instagram Linkedin Twitter Youtube