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Style (03/04/19)

Style 1
A striped short sleeved blouse from Marks & Spencer, P2,350

Marks & Spencer lowers prices

MARKS & SPENCER has kicked off its “New prices you’ll love” campaign in the Philippines, along with the launch of its Spring 2019 Collection. Prices have been lowered by an average of 18% across menswear and lingerie, and an average of 28% for womenswear. Filipino customers will now be able to purchase Marks & Spencer’s products at the new prices in all its stores in the Philippines. Examples of new price points include T-shirts from P695, jeans from P1,550, dresses from P1,550, knitwear from P1,750, and handbags from P1,550. Marks & Spencer has traded in the Philippines since 1997 with its franchise partner Rustan Marketing Specialists, Inc., and now has 20 franchise stores and two outlet stores in the country.

Women’s Month at Araneta Center

IN celebration of International Women’s Month 2019, the Araneta Center presents “FilipinAmazing: Honoring Filipino Women at the Araneta Center,” a series of activities that focus on empowering women. It opens with the #DontTellMeHowToDress Exhibit, which aims to raise awareness on the issues of rape, violence against women, and sexual harassment. The exhibit opened on March 1 at the Gateway Mall and is on view until March 8. To promote artisanal Pinay-made items, a Women’s Bazaar will be held at the Gateway Mall from March 15 to 17. The bazaar will highlight the products made by women from Spark-sponsored communities, including those from Marawi. For more information visit www.aranetacenter.net.

Style 2
A Levi’s Engineered Jeans trucker jacket

Levi’s made for a dancer

THE new Levi’s Engineered Jeans are made for artist, hip-hop dancer, and “certified hustler” Jesse “Reflex” Gotangco, who represented the country at the R16 World Finals, which he did as part of Project P-Noise in 2010. As a solo act, he has already twice claimed the gold for Solo and Freestyle Battles at the R16 Southeast Asia Championship in 2013 and 2017. To him, dancing is an avenue for self-expression and a form of reprieve from the pressures of daily life. “I look at dancing as a platform to be able to share different things about myself. I get to express social and political issues in a way that is relatable and entertaining,” he explained. As movement is the name of the game in hip-hop, Reflex stresses the importance of free, unrestricted motion when it comes to fully expressing one’s self in dance and other forms of the performing art. For this reason, Gotangco is all praises for the return of Levi’s Engineered Jeans. “It definitely helps with my movement and it looks just so casual, which is cool because you can wear it everyday. And anytime I need to get down and dance, I can get down with these jeans for sure.”

Style 3
Outfits from the 0917 x Captain Marvel limited edition collection

Captain Marvel line

AS the Marvel Cinematic Universe (MCU) is about to launch a movie about one of its strongest heroes, Captain Marvel, 0917 Lifestyle and Marvel have joined forces on the 0917 x Captain Marvel limited edition collection. The latest entry in the MCU film series, Marvel Studios’ Captain Marvel is set in the 1990s and how Carol Danvers, a former US Air Force fighter pilot, transforms into a mighty hero and joins Starforce, an elite military team of Kree, a scientifically and technologically advanced alien race. As planet Earth gets caught at the center of a galactic clash between two alien worlds, Danvers heads home to know more about her past and try to resolve the conflict. The collection takes off from the movie’s ’90s look mixed with elements from military uniforms, all bearing Captain Marvel’s logo or trademark insignia. The collection includes casual T-shirts, a fatigue jacket, a windbreaker, and accessories like a tote bag and fatigue cap. The 0917 Lifestyle x Captain Marvel collection is available at the Globe Online Shop, as well as selected Globe Stores. The movie premieres locally on March 6.

UnionBank’s thrift arm CitySavings completes merger with PR Savings

THE THRIFT BANKING arm of UnionBank of the Philippines, Inc. has completed its consolidation with Philippine Resources Savings Banking Corp. (PR Savings Bank), in line with the central bank’s efforts to strengthen the industry through lenders’ mergers and acquisitions.
CitySavings Bank, Inc. said in a statement sent to reporters on Saturday that it has merged with PR Savings Bank, with the former as the surviving entity.
CitySavings President and Chief Executive Officer (CEO) Lorenzo T. Ocampo said the merger paves the way for the Aboitiz-led bank to diversify into the motorcycle financing market.
“Expanding our physical network and capitalizing on our operational efficiency will allow us to bring the CitySavings experience of superior customer service to more Filipinos,” Mr. Ocampo said.
Isabela-based PR Savings Bank is focused on motorcycle, agri-machinery, and teachers’ salary loans, serving over 131,000 borrowers mostly from the mass market segments.
PR Savings is part of the Ropali Group of Companies, a mid-sized conglomerate with focus on motorcycles and agricultural machinery.
The merger is in line with the push of the Bangko Sentral ng Pilipinas (BSP) to improve financial inclusion in the country and strengthen the banking industry through mergers and consolidations.
A memorandum posted by the central bank in late 2016 lays out a set of incentives to reinforce the BSP’s call for banks and quasi-banks (QB) to consolidate to fortify their financial footing.
Lenders and QBs can seek regulatory relief from the BSP, convert or upgrade head offices branches and other offices, and relocate branches within a year in cases of duplication in certain areas, among other incentives.
“Our mission has always been to unlock the economic potential in our communities, be they in the cities or in the countryside, by delivering financial services to our unbanked and underbanked countrymen,” PR Savings Bank President and CEO Catalino S. Abacan said.
“Though the name ‘PR Savings Bank’ will cease to exist after this merger, we as CitySavings will continue to embrace our commitment to this mission.”
The merger of the two banks was announced in January last year, with the BSP green-lighting the acquisition in June.
PR Savings Bank, the 15th largest thrift bank in asset terms, operates 102 branches and other banking offices.
Meanwhile, Cebu-based CitySavings is the sixth largest savings bank in the country. It provides a range of mass market financial products and services such as salary loans to teachers, pension loans, seafarer loans and traditional deposit products. It has 115 offices nationwide. — K.A.N. Vidal

Farmers stage protests after prices of turmeric crash in India

NEW DELHI — A bumper harvest has led to a crash in turmeric prices in India, the world’s biggest producer and exporter of the bright yellow spice, causing furious farmers to stage protests in key growing regions demanding government help, growers and traders said.
Turmeric, which holds antioxidant and anti-inflammatory properties, has been gaining in popularity among health-conscious consumers around the world in recent years.
But it is still predominantly used in a variety of tangy Indian curries, aromatic biryani and other food products. Indians also consider turmeric auspicious and it is smeared onto the faces of both the bride and groom ahead of weddings in a ceremony meant to bring good health.
This year’s bumper crop is the result of a boom in last year’s planting after prices soared in 2018 due to lower output and depleted stocks. Now, prices have slumped nearly 24 percent since the beginning of 2019 thanks to mounting stocks at wholesale markets.
“Turmeric prices have dived and desperate farmers have hit the streets to highlight their plight,” said Punam Chand Gupta, a trader from Nizamabad, a key market in the southern Indian state of Telangana. “Prices have been falling since January and farmers are forced to sell at really low prices.”
Turmeric takes nine months to mature so crops planted in June mainly show up for both domestic consumption and exports in January.
Turmeric prices hovered around 85,000 rupees ($1,200) a tonne in December and started sliding in January, when the new season crop started trickling in, farmers and traders said.
“Prices continued to slide through January and February, and have dived now to 65,000 rupees a tonne,” said another farmer in Nizamabad who only goes by one name, Abijith.
“The government should come to our help by either ensuring that turmeric prices go up a little or buy some of our produce at a government-set price,” he said.
Officials at the state-run Spices Board of India were not available for comment.
Millions of Indian farmers are reeling from low farm gate prices and accuse Prime Minister Narendra Modi’s government of overlooking their plight.
India produces an average 6.5 million bags of 70 kg each of turmeric each year and exports about 1 million bags to countries such as Japan, Malaysia, Bangladesh, the United Arab Emirates and the United States. India accounts for about 80 percent of global turmeric exports but its overseas sales pale in comparison with its annual consumption of around 6 million bags.
This year’s turmeric production has touched 7 million bags, up from 6 million bags in 2018, farmers and traders said.
The rising production has pushed carryover stockpiles to 4 million bags through this year, they said.
The crash in prices could prompt farmers to switch to other crops. Turmeric competes for acreage with crops such as soybean, pulses and tobacco that take less time to grow. — Reuters

Feb. inflation data to dictate shares’ movement

THE MOVEMENT of shares this week will depend on the release of inflation data for February — which could dictate how the main index will perform for the rest of the year.
The benchmark Philippine Stock Exchange index (PSEi) dropped 0.83% or 63.72 points to close at 7,641.77 last Friday. On a weekly basis, the main index suffered its largest loss since June 2018 after it shed 4% or 320 points.
All sectors ended in negative territory, with the counters for financials and holding firms posting the biggest losses for the week at four percent each. Decliners prevailed for the week, 116 to 74, while the net foreign selling print stood at P612 million.
“[This] week is the release of February inflation. We see inflation continue to slow which is most likely to be the case, then this may provide the catalyst that this market badly needs to bounce back and start gaining momentum,” Eagle Equities, Inc. Research Head Christopher John Mangun said in a weekly market report.
The Bangko Sentral ng Pilipinas estimates inflation to have settled within the 3.7-4.5% range for February, while hinting that the rise in prices is likely to sustain its downtrend for a fourth straight month. This compares to the 3.8% inflation figure seen in February last year.
The Philippine Statistics Authority will release official inflation data on Tuesday.
Mr. Mangun said the “only hope” for the market would be to hold its support level of 7,500. Should it fail to stay above this mark, the PSEi could fall back to as low as the 7,000 level.
“We have seen double-digit percentage growth from several major companies’ earnings however, it has failed to renew investors’ optimism as they continue to be cautious,” Mr. Mangun said.
Meanwhile, online brokerage 2TradeAsia.com noted that several firms will be releasing their 2018 financial results this week. This includes Metro Pacific Investments Corp., PLDT, Inc., and International Container Terminal Services, Inc., which account for a 7.3% share in the PSEi basket.
“What may deserve merit is the payout plan for 2019, which will be reliant on capex rollout and other working capital requirement. Any hint of more aggressive rollout may risk reducing expected dividends, unless negated by cost-reduction measures or other income sources,” 2TradeAsia.com said in a weekly market note.
Overseas, investors will be watching how the United States and China will iron out their trade deal.
“Global fund managers will heed for clarity how key officials will draft expected milestones from the US-China trade talks extension. Timeline setting will be key to supply chain management, especially for industries that have dependencies on key material inputs,” the online brokerage added.
Eagle Equities’ Mr. Mangun placed the index’s support from 7,500 to 7,600 and resistance from 7,700 to 7,800. — Arra B. Francia

Why retention programs have become crucial in the health care business

By Vincent Mariel P. Galang
Reporter
A GOOD retention program is a must to ensure employee loyalty not only in businesses, but also in hospitals, where keeping trained professionals has become a challenge because of low pay.
Dr. Arturo S. De La Peña, president and chief executive officer of St. Luke’s Medical Center, said in an interview on Feb. 18. that the major challenge in retaining medical professionals, especially nurses, is their smaller salary when compared with those overseas.
“‘Yung mga nurses natin [our nurses] and other medical technicians are being pirated by other countries, and the differentiating point is the amount of salary that they are receiving,” he said.
For instance, regular nurses in Singapore are able to receive P120,000 to P150,000 per month, while those in the Philippines, in the case of St. Luke’s, receive about P31,000 per month, he said.
In addition, the aging population of countries such as Japan and Germany has prompted them to recruit nurses in the Philippines. Japan last year announced the need for 48 registered nurses and 585 registered caregivers, while Germany early this year announced the hiring of 400 local nurses.
In turn, St. Luke’s has looked into its compensation programs while developing programs for the skills development of its nurses, Dr. De La Peña said.
“Our threat is number one, how to retain, and how to recruit new nurses, so we’re trying to improve the working condition of the nurses so we can improve retention. And we’re doing improvements in our training programs, so that we will be the preferred hospital to be applied by new nurses,” he said.
Starting last year, talent calibration and succession planning were implemented to help the nurses know where they can work best and in effect identify potential future leaders.
“Last year, we did a talent calibration so that we would know the specific skills of all of the people within the organization and see whether their skills fit to the job that they are doing because if there is no fit we can probably redirect them to a field where their skills will fit in,” he said.
“We developed also the succession planning. It is essential to do so, so that from the talent calibration, you are able to identify emerging potential key leaders. You need to do so, so that everybody will be motivated to work harder for the organization and from the talent calibration, you would know who are to be promoted and identify future leaders of the organization,” he added.
Recruiting an outsider is an option only when no one in the hospital is found to be a potential leader can.
“The success of every organization depends on a robust succession planning and it depends also in infusion of new talents, so from the talent calibration, from the present roster of employees you are not able to identify who would lead that particular section now we are going to recruit from the outside,” he noted.
The group is also looking into giving nurses the chance to learn another language depending on the need. It is also developing a curriculum that allows nurses to be trained in a specific field. In effect, these programs will be able to help nurses increase their value if they opt to go overseas in the future.
“One program that we are offering our nurses — we put a retention timeframe for them. Once they get employed they have to stay with us for about three years,” he said, adding that the hospital is considering giving them an option to learn a second language.
He said nursing today has become a specialized field, thus the hospital is developing a competency-based curriculum that is geared towards specialized nursing. For instance, some nurses are being trained specifically for the operating room in addition to their basic skills. Some are being trained for critical care, for the elderly, for cancer patients and for those undergoing dialysis.
“What we are doing is, as they work with us, we are preparing programs, so that they could also be certified on these sub-specialties, so that when they go to other countries their value becomes higher,” he said.

Face (03/04/19)

Face 1

Avon True colors

AVON has just come up with a new line of six nude lipsticks from Avon True Color. The six new matte shades, covering a full range of Filipina-friendly tones, from light (Nude Suede) to deep brown (Chocolate Crush) to a variety of creamy tans (Marvelous Mocha, French Toast, and Lush Cocoa). You can even wear a hint of red with Divine Twig. Avon guarantees fuss-free color that never cakes, cracks, nor compromises. Visit www.avon.ph or like Avon Philippines on Facebook to find out how you can get in touch with an Avon representative or download the Avon Brochure application from the Google Play or Apple Store to start browsing the latest brochure.

Face 2
Kiehl’s Clearly Corrective Clarity Booster Hydration Mask

A dark spot solution

CITY LIVING — harsh UV exposure, pollution, stress, unhealthy food choices — plus hormonal changes make the eradication of post-acne marks and pigmentation difficult for some. One way to address this is the Clearly Corrective Dark Spot Solution, Kiehl’s #1 serum in the Philippines, with the following active ingredients: Activated C, a Vitamin-C derivative that penetrates the skin to reduce dark spots, improve clarity and prevent the appearance of new spots and discoloration; White Birch, a sugar derivative which restores hydration and supports clarity; and, Peony, a traditional Chinese antioxidant. Now Kiehl’s has come up with the Clearly Corrective Clarity Booster Hydration Mask, clinically proven, it says, to deliver the visible brightening efficacy of a 12-day serum regimen in just 15 minutes of use. Aside from featuring the key ingredients in the Clearly Corrective Dark Spot Solution, the mask also has Hyaluronic Acid for hydration.

Mary Kay Skin Analyzer

MARY KAY Philippines introduces the Mary Kay Skin Analyzer, a compact and portable skin analysis tool used by Mary Kay Independent Beauty Consultants, which is powered by A.I. technology and has a 50x zoom lens. The analyzer looks at six dimensions of skin — moisture, oil, sensitivity, pores, elasticity and skin tone — to help recommend a skin care regimen tailored to the customer. For more information about the Mary Kay Skin Analyzer, speak to a Mary Kay Independent Beauty Consultant or visit www.marykay.com.ph.

How PSEi member stocks performed — March 1, 2019

Here’s a quick glance at how PSEi stocks fared on Friday, March 1, 2019.
psei030119
 
Philippine Stock Exchange’s most active stocks by value turnover — March 1, 2019.
pseiactive030119

The Most Important Appointment

We mourn the passing of Governor Nesting Espenilla. A profound loss to his family and friends, to the BSP which has been his home since UP days and to our country and people. As a tribute to him and his work, I am sharing the introduction of an interview Christine Tang and I did for GlobalSource Partners (globalsourcepartners.com) in January 2018.
‘CONTINUITY ++’
His job was going to be “the most important appointment” that President Rodrigo Duterte was going to make. That was what Finance Secretary Carlos Dominguez told the President, who was then less than a year in office, about his upcoming choice for the next governor of the Bangko Sentral ng Pilipinas (BSP). The Secretary made sure to let the President know that if it were up to him, he would prefer someone in the mold of Amando Tetangco, the highly-regarded and multi-awarded BSP Governor who, for 12 years, was a stabilizing anchor to the Philippine economic ship.
It was thus the most awaited announcement in the local financial community at the start of 2017, a time of high anxiety due to political and economic uncertainties here and abroad. The President bided his time in naming Mr. Tetangco’s successor, and in the interim contributed to the air of uncertainty with his unorthodox style and outspokenness, including threats against the Anti-Money Laundering Council (AMLC), chaired by the BSP Governor, which raised more fears that he would name a political ally to ensure the AMLC’s cooperation in his drug war.
Nestor A. Espenilla, Jr.’s name was finally announced around dinnertime on May 8, instantly putting economic watchers and the financial community in a celebratory mood. Commentators toasted the President for choosing wisely, someone not known to him personally; they saluted Secretary Dominguez for helping the President choose wisely with, we heard, a very, very short list of candidates; and praises went to the BSP for having nurtured and trained a bright and talented young economist into a mature central banker who easily stepped into the leadership role when the time came.
Mr. Espenilla took office on July 3, 2017, perhaps the most well-rounded in central banking of all those who came before him. His career in the BSP (previously, the Central Bank) spanned over 30 years, starting in economic research, then international operations, then supervision and examination of financial institutions, where he rose to Deputy Governor in 2005. Like his predecessor, his was a crisis-tested professional life, going way back to the 1980s debt crisis, followed by the Asian Financial Crisis in the 1990s, and the Global Financial Crisis a decade later. Graduating magna cum laude, Mr. Espenilla held a BS in business economics degree from the University of the Philippines where he also earned a masters in business administration (MBA). He also had an MS in policy science from the Graduate Institute of Policy Science in Tokyo, Japan.
Those who knew Governor Espenilla were one in saying that his rich experience, high intelligence, and humble and easy disposition equip him well to continue the legacy of Governor Tetangco in shaping the BSP to be “alert, nimble, responsive and able to provide the stability necessary to give direction that the market needs at any time,”while breaking new ground in the Philippine’s quest for greater financial inclusion and capital market development, and in facing new challenges coming from increased global economic and financial integration and disruptive technology.
I share the hope of the financial community and general public that once again, authorities will choose wisely and well to ensure “Continuity ++” in our central bank and our country’s finances. To do otherwise risks gains made to bring us on a much higher growth path of 7-8% annually to improve our people’s lives. Even the lower end of this range is ambitious. Our forecast for GlobalSource Partners is only 5.8-5.9% over the next two years, among the less upbeat. This is what said in our Chinese New Year cum Valentine’s Day report :“The Days of Swine and Roses.”
“The economy’s recent performance, where higher domestic demand growth led to higher import leakages, suggests that growth rates approaching 7% are unlikely in the short term. Too, monetary tightening last year that raised interest rates by a total of 175bp will exact some pain on consumer and business spending. Thus, despite falling inflation and some reinforcement from election spending, we think that output growth will continue to slide and fall below 6% as opposing forces weigh on domestic demand components.
In particular, while household spending can rely upon the usual support from overseas remittances, growth is expected to remain in low single-digit, with friendlier foreign worker policies in Japan counteracted by tighter visa policies in the US even as countries in the Middle East continue to grapple with fiscal problems and favor local-hire policies. Likewise, while the BPO industry is looking at continuing jobs expansion, the sector grew markedly slower last year and remains under threat not only from adoption of AI technologies but also from uncertainty in the business climate as the mid-term elections near with government’s proposed reform on corporate taxation passed over by Congress. Fiscal spending, which has been a key driver of recent growth, may also hit speed bumps in the near-term associated with the delayed passage of the national budget, election spending bans and potentially, closer scrutiny of budgetary processes that may have permitted quicker procurement recently. Continuing strain from net exports is also expected.”
THE MOST IMPORTANT LEGISLATION
The one counterweight to these headwinds is the recent reform of our rice policy, an on-and-off effort of over 35 years, finally achieved by a strong and purposeful administration. Against wrong-headed populists and well-heeled profiteers, the Dominguez team and Congress passed The Rice Tariffication Law. This is transformational — in ending rice price-induced inflation, in reviving our moribund agriculture, in reducing malnutrition and poverty, in making our manufacturing sector more wage competitive. It will also stop NFA corruption and save taxpayers tens of billions annually.
There is now an opportunity for yet another milestone legislation. By amending the archaic Public Services Law (Commonwealth Act no. 146, 1936) we will open up the country to foreign direct investments in strategic sectors, such as transport and telecommunications, making such needed services more available, creating jobs, and improving the competitiveness of the Philippines. Increased foreign direct investments can also help finance the growing current account deficit. There is an opening in the resumed session of Congress in May to bring this to the finish line. Our Foundation for Economic Freedom urges the Executive and Legislative branches to give this top priority.
 
Romeo L. Bernardo is Vice-Chairman of the Foundation for Economic Freedom and GlobalSource Partners Philippine Advisor. He was Finance Undersecretary during the Corazon Aquino and Fidel Ramos administrations.
romeo.lopez.bernardo@gmail.com

What the Philippine Coast Guard now needs

The role of the Philippine Coast Guard (PCG) in development has not been fully articulated. This essay attempts to show why it is necessary to provide budgetary support for the PCG, but it is equally important to determine where the priorities should be.
It was during the early US occupation, on October 17, 1901, that the Bureau of Coast Guard and Transportation was created. Its primary mandate was to maintain lighthouses, support the transportation of government officials in different provinces, and prevent illegal entry of immigrants. It was much later, by virtue of Republic Act 5173, that the Philippine Coast Guard became one of the sub-units under the Philippine Navy, retaining its mandate on maritime law enforcement and maritime safety. Before President Fidel Ramos stepped down in 1998, he signed an Executive Order transferring the PCG to the Department of Transportation and Communications.
After more than a decade, Congress passed the “Philippine Coast Guard Law of 2009,” clearly stipulating therein that the PCG is an armed uniformed service that has the mandate to carry out maritime safety, marine environmental protection, maritime security and law enforcement and maritime search and rescue.
In 2012 the PCG gained prominence after its white ships replaced the Philippine Navy vessels in patrolling the West Philippine Sea (WPS) to reduce the tension during the Scarborough Shoal stand-off. This strategy had been sustained as the Philippines has complied with the agreed norms among claimants that the WPS should not be militarized.
Since then, the PCG has been receiving various grants from different countries to boost its capability especially in maritime security.
Just recently the PCG commissioned two 24-meter fast patrol boats, which were built by Ocea Company and funded through a loan agreement with the French government. In recent years, the vessel inventory of PCG has gradually increased. The PCG will eventually have its offshore patrol vessels soon, one 82-meter vessel will come from France and two 94-meter vessels will come from Japan.
There is a report that the Netherlands is proposing to provide 503 patrol boats to the PCG for free. Although such an offer is complicated to turn down, the PCG leadership must come up with a sound and rational planning as to how it wants to modernize and strengthen its capability. It is not as simple as having more bottoms to make the PCG more powerful. The PCG must consider the maintenance and operational costs should these vessels be placed under the PCG.
The PCG now has eight Australian-built Search and Rescue vessels (SARVs), ten Japanese-built Multi-Role Response Vessels, a tugboat, a 60-meter Japanese buoy tender and the ten Spanish-built Monitoring Controlling Surveillance vessels of the Bureau of Fisheries and Aquatic Resources, which the PCG currently mans.
With the growing number of PCG ships, the PCG leadership must assess if new bottoms from its benefactors are still on the top of its wish list.
The PCG has to determine whether the SARVs are still in tiptop condition after almost two decades as its only working assets. It is already an open book that the majority of these vessels are not as “ready for sea” as they were many years ago. Due to wear and tear and subsequent grounding incidents, these vessels need major rehabilitation. The rehabilitation of the SARVs is a rational choice since the cost would be less than constructing a new one.
coast guard
This inventory is not yet enough for the PCG to effectively perform its mandate that includes maritime safety, maritime law enforcement, pollution prevention, and maritime security.
It is necessary to evaluate what the PCG needs right now. On the one hand the national budget constrains the PCG modernization because tax revenues prioritize infrastructure and social services. On the other hand, other developed countries like Japan, the United States, and even European counties are all willing to pour grants and loans for the PCG. In this light, the PCG needs to make the right and reasonable requests.
Furthermore, it is about time that the PCG professionalized its personnel who have the competence in repairing and maintaining the ships. However, improving the skillset of its personnel has to go hand in hand with developing a coast guard shipyard. No matter how many times the United States and Japan train the PCG personnel in repairing ships, this will still come to naught if the Philippines lacks the needed repair facility. The PCG cannot forever be dependent on commercial shipyards for repair and maintenance. With the US planning to support the establishment of an outboard motor repair academy and with the increasing number of PCG vessels, the PCG must have its shipyard that developing countries like Japan and United States can support in founding.
Another consideration is the port facility. The Department of Transportation has not yet constructed new ports for PCG’s exclusive use. There are only two known berthing spaces for the PCG’s exclusive use; the first is at the back of the PCG National Headquarters and the second is at the South Harbor where the PCG shares the docking area with the presidential yacht and the Presidential Security Group. PCG vessels berthed inside ports managed by the Philippine Ports Authority in different parts of the country are even asked to leave to accommodate commercial ships that are a source of income. The safety or security of an expensive government asset is disregarded in favor of earning berth fees. Having no ports or wharves for the vessel is akin to having an expensive car with no garage.
Another necessity is the purchase of aircraft. It is with so much irony that an agency whose mandate includes search and rescue operations in a country of more than 7,100 islands that is visited by an average of 22 typhoons annually has only two units of Britten Norman islander aircraft and two Bell helicopters. Worse only one of each aircraft type is operational.
The PCG has been pushing for the acquisition of additional aircraft since 2010, but nothing has materialized. Though the Department of Budget and Management (DBM) procurement service has already completed the bidding and is optimistic that the first Airbus helicopter will be delivered soon, the PCG leadership should be able to court attention from its foreign benefactors that acquisition of air assets is likewise necessary.
The last one is the establishment of radar stations within the country. The PCG should have a detailed real-time maritime domain awareness (MDA) of its coastal areas from its northernmost island to the last territory in Mindanao that borders Malaysia and Indonesia. The National Coast Watch Centers (NCWC) through the assistance of the United States government have established radar stations in selected regions. For an archipelagic country where thousands of international vessels pass through within its maritime jurisdiction, there is no way that the PCG can effectively monitor those ships that violate international and domestic laws, pollute our seas and jeopardize national security without a well-established radar/automatic information system (AIS) stations nationwide.
With the limited PCG budget, it must reconfigure its wish list in order to optimize what the official donors can provide for the accomplishment of the PCG’s mandate of ensuring a safe, clean, secure, and peaceful sea.
All views expressed in this article are his own and do not necessarily represent the official stand of the Philippine Coast Guard.
 
Jay Tristan Tarriela is a commissioned officer of the Philippine Coast Guard with the rank of Lieutenant Commander and a Japan International Cooperation Agency (JICA) scholar at the National Graduate Institute for Policy Studies (GRIPS) under the GRIPS Global Governance (G-cube) Program in Tokyo, Japan. Action for Economic Reforms has initiated collaboration with Filipino scholars under GRIPS.

Makati’s audacious ambitions

Bar none, the city of Makati is the country’s best foot forward to the world. It represents what we Filipinos are capable of as far as city planning and urban development goes.
Makati tops most domestic indices in terms of business vitality, tax revenues, infrastructure, ease in doing business, disaster preparedness, cultural vitality, social services and the use of technology. It is among the key financial centers of Asia. Although imperfect in many ways, Makati remains to be the nation’s most progressive city.
While the Ayala Group can be credited for having developed a central business district, a retail corridor and well-planned residential villages, we must recognize that the city government had much to contribute towards Makati’s success, especially in its early days of development. It was the city government that introduced game-changing innovations such as a simplified system to obtain business permits, the digitization of business and real estate taxes and the use of a Command Control & Communications Center (an extensive system of more than 100 CCTV cameras) used for law enforcement, emergency response and disaster mitigation. All these, among others, have made Makati conducive for business and a safe place to live.
In infrastructure, it was the first city to invest in pedestrian tunnels, underground utility cables, computerized traffic control systems and a waste management recycling facility.
Makati leads the way in social development programs too. Within the halls of Makati’s public schools and university, residents enjoy free tuition, books, uniforms and even shoes. In health care, the city boasts a hospital rigged with advanced medical equipment. Residents are entitled not only to free medical care but also medicines on the city’s account. Analysts agree that Makati’s social programs are superior to many cities in the European Union and America.
The fact that the city government built upon the success of the Ayala Group’s master plan should not be taken lightly. It could have gone the way of the city of Manila. It will be recalled that Manila had everything going for it at one time. It was home not only to the country’s first business district (Binondo) but also its cultural, tourist and university belt. Yet, Manila has fallen into depths of poverty, urban decay, blight and squalor, all due to mismanagement.
Makati is proof that forward-looking governance and investment in infrastructure are key to competitiveness, sustainability and a dignified way of life.
THE NEXT LEVEL
The two leading mayoral candidates are incumbent Mayor Abigail “Abby” Binay and brother Junjun Binay.
Many suspect that this is a ploy for the family to remain in power regardless of the election outcome. Based on what I know of the family’s dynamics, I do not believe this to be the case. Both siblings are dead set to serve as Mayor with neither giving way to the other. It’s ugly, but it happens in many political families. As adults, however, Abby and Junjun have decided to just slug it out in the polls.
I will not talk about Junjun since I haven’t had a chance to speak to him in earnest about his plans for Makati. I did talk to Abby at length about her forthcoming programs. We had an animated conversation and I was rapt. Her passion to take Makati to the next level of development was both obvious and infectious.
Mayor Abby has grand ambitions for the city. To sum it up, she wants to transform Makati into a Smart City within the next six years. For those unaware, a Smart City is one that is digitally interconnected, paperless, cashless, efficient, green and ready to participate in a knowledge-based economy. This is the same direction taken by other progressive cities like Singapore, Seoul and Taipei.
For Abby, the basics of good city governance (e.g. ease in doing business, social development programs, basic city services, etc) are givens. Her intention is to leap to the future using technology as an enabler.
As we all know, reaching the next level of development requires more than just money and determination. It takes skills, tools and systems to get programs implemented efficiently. Abby has spent the last three years building the city’s management team and fine-tuning its systems. Her background in the telecommunications industry (she worked with Smart Telecoms before) comes into play too. With a strong organization backing her up, her ambitions for the city are not so far-fetched.
With wide eyes and palpable fervor, Abby told me all about the many projects in the pipeline.
At the heart of the effort is an upgrade of the city’s digital infrastructure. Makati is now in the process of installing its own fiber optic cable and mobile signal boosters to strengthen cellular bandwidths. These projects are being done through a PPP framework with Neo-Converge ICT Solutions and Voyager Innovation as private partners.
When complete, Makati will have the strongest internet signal in the country, making it the natural choice for multinationals, corporate headquarters and startups involved in technology, knowledge and innovation.
This will also enable the city to provide free internet services to 27 barangays.
With the digital backbone in place, government offices will all be interconnected, thus, eliminating bureaucratic redundancies. Processes that took hours, if not days to complete before can now be done instantaneously.
On the ground, high speed digital connection will allow law enforcers to feed live images to the city’s command center through body cameras. Decisions and responses can be made on the spot.
Another of Mayor Abby’s keystone projects is the Makati Citizen Card or MakatiZen Card, as it is widely referred to. This is a project also done under a PPP framework with Globe Telecom and iBayad Online Ventures as private partners.
The card, which functions as a valid government-issued ID, allows its holder to access public services and transact with the city government without the need to carry piles of papers, certificates or licenses. A simple swipe of the card reveals the personal data of the cardholder, including his medical history. The card also serves an up-to-date city census.
The card gives its holder an automatic GCash mobile wallet. As such, cardholders can receive cash allowances, stipends, and other cash benefits digitally. The cards can be used to pay for fees and taxes, as well as for personal remittances. It can also be used to purchase goods and services from GCash accredited establishments, including Jollijeep vendors. The absence of cash minimizes corruption and deters crime.
Tens of thousands of Makatizen cards have already been issued. The goal is to have every resident and transient worker of Makati carry one.
The Makatizen card comes with its own application (app) on an android platform. Through the app, cardholders get a direct hotline to City Hall. Residents can call for police assistance, report disasters, crime and even request for pothole repairs. Conversely, it provides the city with a direct access to its citizens. The app is an invaluable tool especially when enforcing new ordinances and implementing disaster protocols.
The Makati Zen Card and App triggers the digital transformation of Makati and brings it one step closer towards becoming a cashless eco-system and Smart City.
In addition, the new fiber optic facility allowed Mayor Abby to invest in four Command Center Vans equipped with telecommunication equipment directly linked to the city government’s mainframe. This allows the continuance of governance even during disaster scenarios when cellular facilities are down.
THE SUBWAY
Contrary to the rumor that Makati’s subway is struggling to raise funds, Mayor Abby assures that all the pieces are in place for its implementation. As of this writing, the proponents are in the process of validating the assumptions of the feasibility study as a precursor to construction.
Last October, after a Swiss challenge, the city awarded the rights to build, operate and maintain a subway system to a consortium lead by IRC Properties Inc. of Antonio Tiu along with a slew of Chinese companies including Greenland Holdings, Kwan On Holdings and China Harbor Engineering Construction Ltd.. The project is also done under a PPP framework.
The US$3.7-billion subway will ply an 11-kilometer route from Edsa Ayala to Ospital ng Makati with eight stops in between including Ayala Triangle, Circuit Makati, Makati City Hall, Poblacion and Edsa Guadalupe. (Note, we heard that the stop in Ayala Triangle may be cancelled due to technical problems). There will be provisions to inter-connect to MRT3, the Metro Manila Subway and the Pasig River taxi system. Future expansion includes extending the line to Bonifacio Global City. The subway is due to be operational in 2025 and will have a capacity of 700,000 passengers per day. It will reduce vehicular traffic in Makati by 270,000 cars.
Apart from the subway , Mayor Abby will migrate the city’s fleet of police cars, service vehicles and select public utility vehicles to hybrid and/or electric powered vehicles. This is the start towards weaning the city from non-renewable energies.
Makati is fortunate to have a visionary mayor who plans for the future. All indications show that Mayor Abby will keep Makati’s status as the country’s most progressive city and the nation’s best foot forward to the world.
 
Andrew J. Masigan is an economist.

Learning to trust fintech

“Here’s your credit card, Ma’am, no need to sign the charge slip for payments below P2,000,” the waiter at her favorite Italian restaurant says to the lady-lawyer, a regular diner. “But I want to sign the charge slip,” she insists. “See here, there is a blank space for the tip to be given, if the customer wanted the tip to be included in the credit card charge — how would I know if an outrageous tip amount was added by someone without my knowledge? How can I prove, should I question my credit card statement, that I did not write in a tip on the charge slip?”
“We won’t do that, Ma’am,” the restaurant cashier says, but she acquiesces and presents the set of charge slips. And the lawyer signs the merchant copy and the bank copy of the charge slips, after she had crossed out the space for the tip. She prefers to pay tips in cash.
It is all a matter of trust. But the lawyer knows that many things can go wrong with this new style of credit card companies that require no signatures below a certain cutoff amount. First, what happens to the “contract part” of the credit card transaction? Where’s the signature that the credit card owner has agreed to the terms of the credit card usage — particularly the promise to pay? Second, for restaurants and other service providers, there’s that tempting blank space for the tip. What obligation does the credit card owner have for an unsigned, filled in tip? Lastly, and the more dangerous: if the credit card gets lost or is stolen, the impostor-holder of the credit card can charge without question because of no need to sign for the cutoff amount and below. A fraudster can easily hop from establishment to establishment charging P2,000 and below each time, and raking up charges to hundreds of thousand pesos before the card is noticed by the owner to be lost or stolen, and reported to the credit card company for deactivation.
Just the week before, the lady-lawyer’s Mom used her bank’s offsite Automated Teller Machine (ATM) to get some cash to avail of shopping discounts — for most retailers offer up to 20% discount for not using a credit card to pay for regular-priced (not on sale) items. Being quite new to her debit card with the EMV chip, she fumbled with inputting her recently-changed six-digit PIN (password) on the ATM. Okay, the old magnetic-strip (magstripe) ATM cards were so easy to hack, hence the more secure EMV-equipped debit cards — but why does her bank’s ATMs still have those deep hoods to cover fingers keying in the PIN, groping in total darkness for estimated location of number-keys? True enough, she inputted the wrong PIN twice, and her card was sucked in by the ATM. A chilling feeling to have your debit card “captured.”
Chilling — because that one debit card allows access to all your bank accounts from the ATM, and even at the point of sale terminal of merchants, for debit payments. If the debit card is lost, mislaid, or stolen, the unscrupulous user/hacker who knows the password technology and logic, or perhaps even some maleficent bank insiders can withdraw from any of your array of bank accounts on the ATM screen. Sobra naman (too much) to think that, the branch manager chastised the complaining depositor whose debit card was captured at the offsite ATM. But it has been almost two months, and the captured debit card, though deactivated, has not yet been replaced by the bank with “unbundled” (meaning separate) debit cards for each account, as requested by the depositor. Unbundling accounts wrecks the very concept of easy and immediate access to the “total relationship” accounts, the branch manager says. Meantime, the depositor asks for on-time account statements each time she goes to the bank, to be sure there are no movements (debits) from her accounts, which are temporarily inaccessible through ATM. Imagine, in this day of the all-powerful EMV debit card, she has to physically go to her bank to do over-the-counter withdrawals and deposits!
Why don’t you just check your balances online? No way, she said — since that time a year ago when her e-mail was deluged with requests, purportedly from her bank, to provide identification details and other vital info supposedly “to update records.” The sender of the e-mail had the bank’s name, so how could this little old lady know that it was “phising” (posing as a legitimate entity to get sensitive info to impersonate victim and then do the actual financial theft). No to online banking or to mobile banking. If the Bank of Bangladesh was hacked for US$81 million, and the transfers to the illegitimate beneficiaries were allegedly so smoothly executed online by the suspect Philippine bank (by the accused bank branch officer, particularly) to the gambling casino, what better luck would a small depositor have to be spared from being chosen victim by online mechanisms?
The tornado of top-bank ATM hackings in 2017, further lashed by the “mis-posting” fiasco by the second-largest bank all but uprooted the trust of bank clients for high-technology based financial service and transactions (fintech). The Bank of the Philippine Islands (BPI) system glitch affected 1.5 million of the bank’s 8 million clients, with the bank suspending its online and electronic services for a total of 26 hours (Rappler June 21, 2017). Banco de Oro (BDO) reported that 7 of their 3,700 ATMs had been “compromised” due to skimming, as its transaction banking group admitted that all IT systems environments have potential points of failure (manilatimes.com July 01, 2017).
Can we then trust fintech? According to one survey, Filipinos make about 2.5 billion payment transactions per month worth US$74 billion. Only 1% of these consist of electronic payments, and the rest 99% are paid either in cash or checks (Fintechnews Singapore August 22, 2017.) For other transactions 25% of clients are actually using digital channels to interact with some 28,392 branches of financial institutions in the country as of December 2016, according to data from the Bangko Sentral ng Pilipinas (BSP). The numbers are growing, the BSP says (Ibid.). There is nowhere else to go but digital and electronic. No choice. The whole world is going that way, and fast.
The rushing and gushing to sophisticated financial technology by banks and financial institutions — for their own competitiveness and profitability — has probably imposed and exacted the greater weight of trust from depositors, investors and borrowers than what would have been earned by the banks and financial institutions through traditional personal service. “While ‘fintech’ used to refer to the back-end technology to run traditional financial services organizations, (it) has morphed into a term primarily used to describe disruptive financial technologies” (https://learn.g2crowd.com/fintech).
Fintech is good for the financial services industry, as it streamlines procedures, eases regulatory compliance, and facilitates B2B cooperation and sharing of information critical to recognition of risks and decision-making for loans and liability-taking. “One of the major benefits of fintech, specifically in regards to blockchain-based fintech and AI-powered regtech for the financial services industry, is the introduction of transparency. Fintech projects create auditable money trails and can help identify potentially fraudulent activity faster and more easily than a human” (Ibid.).
But what about the completely-human client? What about the risks of identity theft, of privacy of information, and the vulnerability to fraud and crime? How does the ethereal, mysterious cyberspace environment of fintech provide solid and concrete legal and basic rights protection to the consumer in trouble?
We just have to trust fintech and our rapidly changing world.
 
Amelia H. C. Ylagan is a Doctor of Business Administration from the University of the Philippines.
ahcylagan@yahoo.com

A list of don’ts

By Tony Samson
IT SEEMS easier to make a list of don’ts than to-do’s. The negative list is shorter and easier to follow. Laws are usually a list of unacceptable behavior, a list of no-noes’. Customs forms for instance specify only goods that are prohibited entry to a country like illegal drugs, fresh fruits, weapons, or currencies above a certain amount. A declaration of non-possession of these banned items is part of the usual immigration form. Anything not found in the negative list is allowable — did they list pets?
Diets are simplified as a negative list of types of food (or quantities) to avoid. The list of prohibitions is shorter and easier to remember than an enumeration of what to eat to stay healthy. Avoiding sugar, carbs, and certain fruits provide a simple guide for the dieter and demonstrates the elegance of the negative list. Such prohibitions vary depending on the program, like the keto diet. Of course, the admonition of other health gurus to this one is simple too — don’t do it.
We are driven by a “to-do” list for the week like groceries and laundry, or milestone events in a planned career — must have own toilet in the office after three years. A to-do list is used as a performance-rating system that tracks how many checks we’ve ticked in the list. New Year’s resolutions are best expressed as “don’ts” — no more smoking, avoid name-dropping, don’t talk about yourself every time, get rid of tight sweaters.
Management guru Peter Drucker bewailed the almost exclusive focus of management on “priorities,” the critical success factors that need to be accomplished to achieve the company’s mission posted on the elevator. Too little attention is devoted to “posteriorities” which are things that should be put at the very end of a list, so as not to be done at all. Posteriorities are distractions that siphon away time and resources from truly important activities.
One of the talents of Apple’s Steve Jobs as CEO, based on the biography of Walter Isaacson, was knowing which projects or products to kill at the proposal stage. (He instead concentrated in the iPhone.) Doing everything, no matter how interesting, is sure to waste the company’s resources and attention span.
How can Stephen King write two novels a month and rack up 89 of them so far? He has a disciplined regimen of writing six days a week, through holidays and storms, at a rate of ten pages a day. Imagine all the invitations, speaking engagements, and rock concerts he turns down. His simple to-do list implies many don’ts.
Even the ten commandments with their different versions and numbering have eight of them expressed as don’ts. (Thou shalt not kill.) The only two positive ones refer to honoring parents and keeping the sabbath day holy.
A goal is defined not just by what it is but also by what it should not be.
The tyranny of the in-box dictates that items there need to be attended to right away. Can one not simply ignore certain items in the pending file? It is too tempting to equate efficiency to a clean desk, defining this as the absence of unattended items. Maybe it is just as desirable to let certain items pile up and gather dust. This sends a message to a proponent that a request has been ignored, lost in corporate limbo, neither approved, disapproved, nor passed along for further study. It is the equivalent of a requested message response — y no rep? Silence (or lack of a reply) is a powerful message too.
It is easy to mistake a determination to disregard certain things as simple laziness. Maybe it is. Few set out with a negative list. It is seldom necessary to specify what repels us, relying instead on instincts to do the job.
Maybe one list will suffice. A list allows us to focus on priorities if these are very few. The most important thing about lists, negative or otherwise, is the need constantly review them. Those previously averse to uncooked leaves and bits of fruits and nuts in a bowl sprinkled with vinaigrette can develop a taste for salads often in the list of most diet plans.
Can life be simpler without lists of any sort? Yes, but it will also be full of surprises, not all of them pleasant.
 
Tony Samson is Chairman and CEO, TOUCH xda
ar.samson@yahoo.com

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