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Can you impose interest on a refund?

Which of these cases would you prefer?
Case 1: You receive an assessment from the Bureau of Internal Revenue (BIR) after failing to pay taxes. You protested it, but eventually, lost the case and paid the corresponding deficiency tax, plus interest and other penalties.
Case 2: You receive an assessment from the BIR due to your alleged failure to pay taxes. You protested it. BIR subsequently issued a collection letter, then a Warrant of Distraint and/or Levy (WDL) and, eventually, collected the alleged deficiency taxes through garnishment. You filed a case with the Court of Tax Appeals (CTA), and won. Accordingly, the CTA ordered the BIR to refund the erroneously collected taxes.
Some would prefer the second case, which results in a refund from the BIR. However, most would rather not be involved in either case because the taxpayers in any event are at the losing end. Although in Case 2, the taxpayer was able to win a refund, he will have failed to recover the foregone interest on erroneously collected taxes (and, of course, the additional cost of litigation). The taxpayer could have earned more had these funds been applied to operations. This is the sad reality of taxes: if you owe the government, you pay, including interest and penalties; if the government owes you, the government will refund the amount, but without interest. The longer the process takes, the more disadvantageous to the taxpayer.
Some taxpayers would probably ask if there is an instance where interest may be imposed on a refund, especially if there is a delay on the part of the government. Yes, there is. In the Supreme Court (SC) decision in G.R No. 198756 (Banco De Oro, et. al. vs. Republic, et. Al.), the Bureau of Treasury (BoT) was held liable to pay legal interest of 6% per annum on the amount of final withholding tax. It was imposed against the government due to the BoT’s unjustified refusal to release the funds to be deposited in escrow, despite the SC’s orders.
In CTA Case No. 9437 dated Aug. 31, 2018, the CTA further explained that the condition where interest may be imposed on the amount of refund — i.e., it must either be authorized by law or the collection of the tax was attended by arbitrariness.
In the said case, the taxpayer received a Preliminary Collection Letter (PCL) demanding the payment of alleged deficiency income tax and VAT and compromise penalty. Afterwards, the BIR issued a WDL. Thereafter, the BIR issued Warrants of Garnishment to the taxpayer’s banks. One of the banks then placed the taxpayer’s deposit account amounting to P17 million in a separate block account, prompting the taxpayer to file a Petition for Review with the CTA with an Urgent Motion for the Issuance of an Order to Suspend the Collection of Tax. However, while waiting for the CTA’s resolution on the motion to suspend the collection of taxes, the BIR issued an Order for Delivery of checks amounting to P17 million to the bank, to which the bank complied.
The taxpayer filed an amended petition for review, which sought to refund the amount garnished since the assessment has no basis. It also sought damages equivalent to the legal interest rate of 6 % per annum on the garnished amount computed from the date of the BIR’s collection until the full refund.
With regard to the merit of the assessments, the CTA ruled in favor of the taxpayer. The assessment was cancelled on the following grounds: (1) The BIR failed to prove that the taxpayer actually received the Preliminary Assessment Notice (PAN) and Final Assessment Notice (FAN); (2) The PAN and FAN were void, since these were issued pursuant to Letter Notice only without any Letter of Authority; and (3) The right of the BIR to assess the taxpayer had prescribed.
Consequently, the CTA ruled that, since the PAN and FAN are void, the WDL is, likewise, void. The tax authority has no right to collect the amount of P17 million from the taxpayer and, therefore, the BIR erroneously or illegally collected the said amount. The taxpayer is entitled to refund the same.
The CTA, however, denied the taxpayer’s request to impose interest on the erroneously collected taxes. The CTA pointed out that, for the payment of interest to accrue on the amount to be refunded to the taxpayer, it must be either authorized by law or the collection of the tax was attended by arbitrariness.
The 1997 Tax Code, as amended, however, does not contain any provision for interest in case of improperly collected taxes. Hence, interest cannot be imposed on taxes to be refunded, even if the BIR is the one at fault, which resulted in the erroneous collection of taxes.
Arbitrariness, on the other hand, presupposes inexcusable or obstinate disregard of legal provisions. As explained by the CTA, an action is not arbitrary when it is exercised honestly and upon due consideration where there is room for two options, however much it may be believed that an erroneous conclusion was reached. In the case at bar, there was no legal provision violated when the BIR collected the garnished amount during the pendency of the proceeding on the Urgent Motion for the Issuance of an Order to Suspend the collection of tax.
As a general rule, an injunction is not available to restrain the collection of tax pursuant to Section 218 of the 1997 Tax Code, as amended. However, the suspension of collection may be allowed if, in the Court’s opinion, the collection may jeopardize the interest of the government and/or taxpayer pursuant to Section 11 of Republic Act (RA) No. 1125, as amended by RA No. 9282.
Since there was no order yet from the CTA to suspend the collection of tax, the BIR was not precluded from collecting the said amount.
I could just imagine how much income the taxpayer in the cited CTA case could have earned in using the P17 million to fund operations. Placing that amount in an investment that yields an annual return of 3% could earn half a million per year.
It is about time our lawmakers consider in the proposed TRAIN 2 (or TRABAHO Bill, as it is now called) a provision imposing interest on a refund due to the fault or delay caused by the government. Imposing interest on a refund is not unusual. In fact, some countries such as Australia, India, Singapore, and Malaysia allow interest on refunds. Such a provision will safeguard the rights of taxpayers and help the government ensure that the refund and assessment process are performed in a timely manner and with due diligence.
We hope our lawmakers, in drafting TRAIN 2, not only focus on revenue generation, but on creating a tax law that is fair, adequate, simple, transparent, and administratively easy so that taxpayers could say that we have a Tax Reform for Attracting Better and High-Quality Opportunities (TRABAHO).
 
Edward L. Roguel is a partner of the Tax Advisory and Compliance of P&A Grant Thornton. P&A Grant Thornton is one of the leading audit, tax, advisory, and outsourcing services firms in the Philippines.
Wowie.Roguel@ph.gt.com
+63(2) 988-2288.

Peso declines to new 12-year low

THE PESO weakened against the dollar to log a fresh 12-year low on Monday due to continued trade tensions overseas and ahead of expected tightening moves from the local and US central banks.
The local unit ended Monday’s session at P54.23 versus the greenback, 19 centavos weaker than the P54.04-per-dollar finish last Friday.
This was the peso’s weakest finish in nearly 13 years since it closed at P54.30 against the dollar on Nov. 24, 2005.
The peso traded lower the whole day, opening the session to its intraday high of P54.12 versus the dollar. Meanwhile, its worst showing stood at P54.28.
Trading volume inched up to $670.6 million from the $669.9 million that switched hands the previous session.
“The peso again fell to a new 12-year record low after the Chinese government cancelled its trade discussions with the United States,” a foreign exchange trader said in an e-mail Monday.
Beijing has canceled the planned trade talks with Washington as the world’s two largest economies slapped another round of tariffs against each other, the Wall Street Journal reported on Friday.
On Monday, US President Donald J. Trump’s 10% duty on $200-billion worth of Chinese goods took effect, a tit-for-tat response on the levies slapped by China on $60 billion worth of American products.
“I think [the peso weakness is] more of the dollar movement so we saw strengthening of the dollar across the board,” another trader said in a phone interview.
The second trader said the peso traded within a range of P54.15 to its intraday low of P54.28 until it quickly reversed to close at P54.23.
“I think most of the investors are trading more of in a trading range or light ahead of BSP (Bangko Sentral ng Pilipinas) and Fed (US Federal Reserve) meetings this week,” the trader added.
The local central bank is widely expected to raise its benchmark rates during the Monetary Board meeting on Sept. 27 to temper inflation expectations.
Meanwhile, the Fed is also seen to tweak its policy stance amid tightening job market and inflation surpassing the 2% target.
On Tuesday, the first trader expects the peso to move between P54.12 and P54.25, while the other gave a P54.15-P54.35 range.
“The local currency might further weaken ahead of the release of US September consumer confidence data which is expected to boost the greenback’s appeal over the peso,” the second trader noted. — Karl Angelo N. Vidal

Shares extend climb as US-China tensions cool

SHARES climbed on Monday, continuing to bounce back from oversold conditions last week.
The 30-company Philippine Stock Exchange index (PSEi) rose 0.68% or 50.61 points to close at 7,433.61 yesterday, extending the gains posted on Friday. The broader all-shares index likewise jumped 0.53% or 24.12 points to 4,531.52.
“The market continues to go up after getting oversold last week. This is just a follow-through from that oversold condition, so that’s why it continued to rebound today,” Diversified Securities, Inc. trader Aniceto K. Pangan said in a phone interview on Monday.
The PSEi booked a steep plunge last week — sliding to the 7,100 and going back to bear market territory — after investors became cautious about inflationary pressures caused by Typhoon Ompong. The government previously reported that the typhoon resulted in P14 billion in agricultural damage in Northern Luzon.
Analysts warned inflation may not taper off in the fourth quarter, as projected by the country’s economic managers, due to this calamity.
Meanwhile, Regina Capital Development Corp. Managing Director Luis A. Limlingan attributed the PSEi’s movement to reduced trade tensions between the United States and China.
“Investors picked up a few more names after the meteoric rise on Friday, as the effect of trade tension seems to have temporarily worn out. The market’s immediate reaction to [US President Donald] Trump’s tariff action and resultant retaliatory step by China was a snap rally,” Mr. Limlingan said.
The US on Sept. 24 imposed a new round of tariffs on $200 billion worth of Chinese goods, bringing the total amount of Chinese imports with new duties to $250 billion since the trade war started in July. In retaliation, China slapped new levies on $60 billion worth of US goods.
The Regina Capital analyst, however, noted the uptrend may be short-lived as investors watch out for both the Federal Open Market Committee and Bangko Sentral ng Pilipinas’ meetings this week. For the local central bank, economists are expecting another 50-basis-point increase to counter the 6.4% headline inflation reading in August.
Four sectoral indices moved to positive territory, led by financials which surged 1.92% or 31.66 points to 1,680.96. The mining and oil counter followed with an increase of 1.77% or 159.95 points to 9,199.20. Holding firms went up 1.14% or 81.08 points to 7,190.51, while services added 0.83% or 12.60 points to 1,517.84.
Meanwhile, property dropped 0.53% or 19.76 points to 3,688.23 and industrials shed 0.45% or 51.06 points to 11,070.69.
Some 1.31 billion issues valued at P4.57 billion switched hands, slowing down from last Friday’s P11.58 billion.
Decliners narrowly outpaced advancers, 97 to 95, while 42 issues remained unchanged.
Foreign investors were sellers for the 18th consecutive day, with net sales climbing to P563.57 million on Monday, ballooning from the previous session’s P132.15-million net outflow. — Arra B. Francia

Weather officials warn of landslides anew in Cordillera due to typhoon Paeng

RAINS BROUGHT by typhoon Paeng (international name: Trami) could cause landslides anew in the Cordillera Administrative Region (CAR) with soil in the mountainous areas still drenched from the monsoon rains and the previous typhoon, Ompong. Officials from weather bureau PAGASA, in a streamed press conference yesterday morning, said it would be best for residents in landslide-prone areas to take preemptive evacuation measures. PAGASA Assistant Weather Services Chief Rene B. Paciente said the soil in CAR is still “saturated” and even just moderate rains or localized thunderstorms could trigger landslides. As of Monday’s 11 a.m. update, Paeng is forecasted to bring rains from the evening of Sept. 24 to the 25th in CAR and the extreme northern Luzon parts. PAGASA said tropical cyclone warning signals may be raised by Thursday.

8 Chinese nabbed for illegal selling

Bureau of Immigration (BI) logo
THE BUREAU of Immigration (BI) recently arrested eight Chinese nationals for illegally selling retail goods in Manila. BI Commissioner Jaime H. Morente, in a statement yesterday, said the foreigners were caught in the act in two separate operations, conducted on Sept. 20 and 21, at the 168 Shopping Mall in Binondo’s Chinatown district. “The presence of these illegal foreign vendors robs our small Filipino businessmen of livelihood opportunities,” Mr. Morente said, adding that the country’s Immigration Act forbids foreigners from working in the country without a valid permit or visa. — Vann Marlo M. Villegas

Former VP to seek congressional seat

FORMER VICE-PRESIDENT Jejomar C. Binay will run as representative of Makati’s 1st District in next year’s midterm elections, according to a statement released by the United Nationalist Alliance (UNA) party on Monday. UNA also announced the reelection bid of his daughter, Makati Mayor Abigail Binay-Campos. “I am confirming that former VP Binay will run as Representative for the First District under the ticket of Mayor Abby,” said Joey Salgado, spokesperson of Mr. Binay, who was a long-time Makati mayor and also a presidential candidate in 2016.

DOH-7 flags unsafe water sources in Naga evacuation centers

THE DEPARTMENT of Health-Central Visayas (DoH-7) office said water from most sources at the evacuation centers for residents around the Naga landslide area are unsafe for drinking. Dr. Eugenia Mercedes R. Cañal, head of DOH-7’s Task Group Medical for Naga, said the water samples from the five evacuation centers tested positive of fecal coliform, which means these are unsafe for drinking. The samples were taken from faucets, water dispensers, restrooms, and other water sources at the Enan Chiong Activity Center, Naga Central School, Naga National High School, Naalad Elementary School, and the covert court of APO CEMEX. The DOH-7 has recorded 11 cases of diarrhea from the different evacuation centers, but Ms. Cañal said the situation is still “manageable.” There are 1,341 displaced families composed of 4,984 persons. The displaced families include those who live within a one-kilometer radius from the landslide sites in Barangay Tinaan and were forced to evacuate. — The Freeman

Is a military junta tenable?

This article will not delve on the legal issues of implementing a military government. It will discuss the foundation of military culture and its response in cases when the political status quo is challenged.
In some of his public addresses, the President expressed his desire to resign. He has further stated that if this situation ever happens, one of the options is to establish and call for a military junta to take over the affairs of the government.
A military junta is a mode that establishes the takeover of governmental functions by a purely military structure or a military-civilian partnership. In both cases, the military authority generally prevails since it has the means to influence and control the situation. It sets the tone of leadership, decision making, and governance.
In a military junta, additional responsibilities are burdened and reposed in the military establishment apart from its traditional roles that include the administration of laws, resolving conflicts among social, political and economic groups, and domestic and foreign relations. It presupposes that it possesses added core competencies and the facilities to rapidly assume an immediate takeover because a lull will spawn emerging conflicting groups to contest any takeover.
The value of the military establishment consists of both its core competence and core ideology. Core competence defines the AFP’s capabilities where the organization is usually good at. It is a strategic concept. The military’s core competence revolves around its use of force. They are experts in the application and management of conflict and violence. They are responsible in protecting the nation against external attacks, and the government and the people against internal violence.
The military is trained to obey orders that emanate from the Commander-in-Chief down to the chain of command. From the time they take their oath until they shed their uniform after retirement, their milieu is replete with an unquestioned obedience to command. Consciously or unconsciously, they will always follow orders to the latter.
Why is this value essential to a soldier? In war, “There is no substitute for victory,” said General Douglas MacArthur. Hesitation to act decisively in combat will result in a disastrous defeat. This mindset is greatly ingrained in every soldier.
The military’s institutional strength is based on cohesiveness, monopoly of force, and a stable organizational structure solidified by a chain of command. Another military character is a rigid decision-making process that cannot adjust fast enough to different modes of social, political, and economic developments.
Core ideology is defined as the enduring character of an organization, a consistent identity that transcends generations, technological developments, management innovation and even leadership personalities. Military ideology comprises the total mindset of the officers and noncommissioned corps towards society and politics.
According to the military scholar Samuel Huntington, the military profession has three characteristics, namely, expertise, social responsibility, and corporateness. Interpreted in more liberal terms, the core ideology of the military manifests stability and shuns compromises.
Are the core competencies and core ideology of the military institution enough to lead the government, if a military takeover ever happens? Government affairs can be too complicated to be assumed by an armed component.
During the Martial Law period of 1972-1981, the military had a taste of limited political governance exposure. But this assumption of civilian posting did very little for the military mindset to be challenged. Proofs of these are the two People Power revolutions. In both cases, the military all had the chances to easily grab power. Instead, they engineered the smooth transition to a new government.
This phenomenon only expresses that its core competence and core ideology remained intact, despite the wide latitude of options to take over the power structure when given the chance.
After Martial Law, only a handful of retired military personnel were drafted in civilian government, the highest being a Cabinet Secretary. The performance of these government positions had never been assertive nor imposing. They have remained true professionals. You cannot change a military culture overnight. Loyalty to duly constituted authority are deeply embedded in their value system. A military professional is always expected to carry out the commands of any civilian group that assumes legitimate authority from the state. The military establishment throughout history has always acquiesced to the control of the civilian political leadership. Civilian control has always responded positively to the direction of the civilian leaders of the government. By this nature of military-civilian leadership, the balance of power is assured.
If there are changes in the government outside of the constitutional process through a presidential fiat, the military may take over the executive, legislative, and judicial functions of the government. Some civilians consider any military intervention as illegitimate. By the very nature of this inherent burden, it is preposterous to assume a positive change.
One factor is acceptance. The society, currently populated with millennials who were brainwashed continuously with the negative effects of Martial Law even to the extent of disinformation, has been shaped with this mindset. Clash of generational mindsets will emerge with any option that is tainted with military character. Contending political parties will exhaust all means to ensure that their power will not be diluted.
Power corrupts, and every means to maintain and sustain it will be resorted to by any means. With this scenario, you are starting the new rule with a problem.
Patience is the least of the virtues of a military man. He craves for combat, for action, for active and positive leadership direction. If there is a change in governance outside the constitutional process, violence will erupt. Clash of political interests will emerge. Control will be unpredictable. Military patience may taunt the soldier to use force that may create disorder if civilians challenge their authority. The military might interpret noncooperation and nonconformance as a threat to their newly found role. Threat can feed anger which will escalate into physical confrontation and clash of forces in the streets. Alienation from the people is a strong argument against military rule.
Another mode is military-civilian partnership where important legislative and judicial functions will continue to function with military supervision. This happened during Martial Law wherein military superiors were posted and assigned in essential government agencies and industries. It was effective for a while by transferring military expertise and efficiency into the bureaucracy. It further restored order and discipline and the concept of a law-abiding citizen to society. The factors and situation during that time are far different now.
The President has been very generous and overly gracious to the men in arms. Increase in their salaries has upgraded their social status in society. The newly found position has given them more dignity and honor worthy of being identified as a military professional.
On a personal note, therefore, they can never be coerced or intimidated to initiate the establishment of a military junta.
The article reflects the personal opinion of the author and does not reflect the official stand of the Management Association of the Philippines or the MAP.
 
Jaime S. de los Santos is a member of the MAP National Issues Committee and the Chairman and CEO of PMA Alumni Association, Inc.
jaime_dlsantos@yahoo.com
jimmydlsantos@gmail.com
map@map.org.ph
http://map.org.ph

We’re stuck in a time and mind warp

As a direct witness to history spanning 48 years since my graduation from college, I can say that we haven’t learned from history’s valuable lessons.
The intergenerational problems we have today were already being talked about in the ’60s; and if one were to turn back the clock further, whatever angered our revolutionary leaders over a hundred years ago continue to be felt today. It boils down to our “ugali” or character that shapes our attitudes and behavior. That has hardly evolved, proof that we’ve serially ignored history’s lessons.
Marcos’s martial law meant to end government capture by the old oligarchy and to shape a New Society, a New Filipino, a New Philippines. It began with good intentions but it eventually fell to the clutches of ego, power and corruption that created a new oligarchy or elite class that applied the same oppressive and suppressive techniques employed by previous colonizers, specifically, Spain and the United States, to sustain their hold on vast power and fabulous wealth.
Instead of being remembered for its infrastructure, agricultural and industrial development; investments in health services and cultural advancement, those were overshadowed by abuses in the form of monopolies, cartels, takeovers, profligacy, arbitrary arrests, disappearances, mass torture and killings which, consequently, defined Marcos’s martial law years.
Those were extensively recorded. In time we got to know how they lied about, and manipulated, the truth. For sure, some of its sins were exaggerated by haters and political opportunists; but, in the main, those of us who witnessed martial law can truthfully recount what it was really like.
Yet, since the end of martial law, revisionists have been trying to bank on society’s notoriety for forgetfulness as they hammer away at rewriting history, and trying to win over the young and gullible who never experienced it to believe their false version. It’s the classic example of self-interest over national interest.
That’s a major reason why we’re unable to close the chapter on Marcos’s martial law because there is no desire to own up to its failings and make amends. If only they would, then we would be able to say to ourselves, with confidence, that we should now move on with a keen sense of common purpose toward national unity for a better Philippines for all Filipinos.
Last week, my mouth fell in disbelief when I heard JPE utter untruths on television. Just like the time I almost fell off my chair when he launched his memoir around a decade ago where he said that Cory lost the snap elections, there was no electoral cheating and that the attempted assassination on his life was not staged. It was the exact opposite of what I heard over the radio in the morning of Feb. 23, 1986 when he and FVR were holed up in Aguinaldo after dramatically breaking away from the Marcos regime the day before.
He said, at that time that: he cheated for FM in the snap elections; “in his heart of hearts,” Cory won the elections; and staged the assassination attempt on his life to pave the way for the declaration of martial law. That confession actually triggered People Power. I was at EDSA the night before when there was only a motley group on Santolan despite appeals by Cardinal Sin and Butz Aquino. The dam broke when JPE confessed the next day.
Let me tackle two incredible things he said in that televised “tete-à-tete.”
No one was arrested during martial law for his political beliefs and criticisms of President Marcos? What about Nene Pimentel, Ninoy Aquino, Pepe Diokno, Lorenzo Tañada, Max Soliven, Rene Saguisag, Geny Lopez, Serge Osmeña, Nelia Sancho and Maita Gomez to name a few? They may have belonged to various segments of the political spectrum, from left to right, but were arrested for their common opposition to FM.
No one was massacred? Does it matter if mass murder was simultaneous or sequential, wholesale or retail? One thing is for certain — Luzon, Visayas and Mindanao were bloody sites for armed encounters against all kinds of enemies resisting martial rule. The NPA, MNLF and MILF, for example, steadily grew in numbers during that time.
In any case, Ninoy Aquino was killed while in the custody of soldiers at the airport upon his arrival. Primitivo Mijares was killed while working for the regime. Evelio Javier was ordered killed by his political rival who was the regime’s henchman in Antique. Cesar Climaco, another staunch critic, was killed in Zamboanga City. There are more listed in Bantayog ng mga Bayani.
The lack of transparency invites doubts and speculation. To date, the public remains groping for the truth: who ordered the killings to determine if FM deserves some or all of the blame; did they die as armed insurgents or as criminals resisting legitimate arrest; how many were false claims meant to bloat the count and frame the government? Without any segmentation, their denials would be labeled as self-serving and an attempt to evade command responsibility.
It’s been 46 years since the imposition of martial law in September 1972 and we’re still caught in a mind and time warp. We’ve yet to close the chapter on that historic period. We’ll never unite and move on because of the lack of humble acceptance of the grievous mistakes committed and render sincere amends. That’s one of history’s best lessons designed to melt the heart and tear down the walls of division. A good example is South Africa and how they came together after ending its bloody era of apartheid.
My dream is for that to happen in our lifetime, for like-minded patriots to make it our accomplished mission, where ALL SIDES that wronged others face one another with deep remorse, confess what they did, ask each other for forgiveness, and just go ahead in making amends to whoever in the spirit of universal brotherhood.
That will pave the way for our social transformation and unification, like I say time and time again, for a better Philippines for all Filipinos.
 
Rafael M. Alunan III served in the cabinet of President Corazon C. Aquino as Secretary of Tourism, and in the cabinet of President Fidel V. Ramos as Secretary of Interior and Local Government.
rmalunan@gmail.com
map@map.org.ph
http://map.org.ph

The Philippines and the Anthropocene

Is there a way for us to radically reframe what we think about how human beings relate to our environment that allows us to properly respond to the challenges of today’s rapidly changing geopolitical and ecological landscape? While the concept is not necessarily novel, nor the term formally recognized, the Anthropocene is a proposed new geological epoch that marks the point in Earth’s history when the actions of humans had permanently and radically impacted the functioning of the Earth’s geological and ecological systems. A group of scientists, including American chemist Will Steffen and Nobel Prize for Chemistry winner Paul Crutzen, describe the Anthropocene as the epoch when “the human imprint on the global environment has now become so large and active that it rivals some of the great forces of Nature in its impact on the functioning of the Earth system.”
Formally, the International Stratigraphic Chart situates us in the Holocene, which started around 11,500 years ago at the end of the Pleistocene Epoch (more popularly known as “The Ice Age”). A growing number of scientists and academics now argue that human beings must be considered as a major geological force and should be “calendared” apart from the Holocene. Evidence of the Anthropocene period include human impacts on the earth’s systems, namely those involving water, nitrogen, phosphate, and carbon, as well as our impact on the biosphere (e.g. biodiversity, pollination, carbon capture, water quantity and quality, etc.). Aside from these trends in Earth systems, various other socioeconomic trends such as our rapid advancements in energy mobilization, population growth, urbanization, transportation, telecommunications, and construction (including the rate by which we produce and consume the geological materials necessary for these) are considered as evidence of a distinct, measurable, and permanent man-made impact on the Earth.
Our country is certainly at the center of the Anthropocene. For example, the Philippines is still considered to be a biodiversity hotspot. According to the Biodiversity Management Bureau of the Department of Environment and Natural Resources, the country “hosts more than 52,177 described species of which more than half is found nowhere else in the world.” This biodiversity, however, is “threatened by continuous overexploitation, deforestation, land degradation, climate change and pollution (including biological pollution), among others.” To cite other examples, Metro Manila is one of the most densely populated cities on Earth, according to the latest UN Habitat and UN Demographic Data (where the City of Manila is listed as the most densely populated city on Earth). The Pasig River, without even mentioning its current state of pollution, is one of the world’s most polluting rivers. According to the 2017 study “River plastic emissions to the world’s oceans” by Laurent Lebreton, et. al., plastic waste from the Pasig going into the world’s oceans is estimated to be at a low of about 32,000 metric tons to a high of 63,000 metric tons per year, making it the 8th most polluting river on Earth as of 2017. The country is hit regularly by tropical storms and hurricanes, some of which are the strongest in recorded human history, endangering our populace and bringing about loss of life and destruction of property.
Rapid changes and growth in socioeconomic sectors also present new challenges to the current world order. For example, according to a 2009 report by the UN Population Division, the number of people living in urban areas (3.42 billion) only started to surpass the number of those living in rural areas (3.41 billion) in 2009. According to the same report, the number of people living in urban areas is expected to grow rapidly to about 84% by the year 2050. This necessitates a change in our way of thinking about our society, politics, and our relationship with materiality and the Earth. For example, we are in an epoch where the time horizons of development of the Earth itself are dissonant with the short-term concerns of the time horizons of social development. Most still look at economic planning as a yearly, or decades-long affair, without regard to its permanent impact on the Earth’s biochemical and geological systems, which function according to cycles that go on for thousands, if not millions of years. Our technological, agricultural, and urban advancements are rarely harmonized with ecological concerns, if at all. Said in another way, we still plan and develop our cities and daily lives as if our ecology is entirely separate from our actions, leading to the further degradation of our environment.
While there is growing concern amongst the populace on our environment, the current ideological constitution of our political society still frames “the environment” as a static, predictable, and (in some circles) merely socially constructed externality. Models of development proposed by dominant forces in the political spectrum still operate on developmental models that assume a separation between human beings and the Earth and that linear, inexorable progress is the only way to go.
On a more practical level, the amount of knowledge and concern that our policy makers and leaders have on the issues that face the environment, and the current state of human progress should make us weary. The Earth is a complex and fragile system marked by non-linear and ultimately highly unpredictable events and cycles. Our horizons of thought, institutions of government and policy making are still stuck in the materialist assumptions developed during the Industrial Revolution, a time when our understanding of our relationship with the Earth was still based on human supremacy and mastery over its resources. As a matter of response on a more concrete level, citizens capacitated to effectuate changes in the disaster risk reduction, management, and response programs of local governments and communities should incorporate insights from this emergent discourse on the Anthropocene. Students may also want to consider careers (such as in Urban Planning, among others) that will directly set the course on how we build the cities of the future. Philippine leaders, formators, and citizens must embrace new modes of thought and conceive of new solutions that will inspire a new generation of leaders who will emancipate us from those who say that our human imaginaries and progress are separate from that of our planetary home.
 
Miguel Paolo P. Rivera is a faculty member of the Political Science Department of the Ateneo de Manila University.

Connecting Europe and Asia: Time to move up a gear

By Federica Mogherini
EUROPE and Asia have a centuries-old common history. The ties between the two continents are today reaching an unprecedented level. Asian markets account for over one third of exports from the European Union. Almost half of the goods and services imported by the EU come from Asian countries. Every year, thousands of students, academics, researchers move between the EU and Asia. The cultural exchanges between our cities are vibrant. And there is more to our mutual relationship than just economic or scientific exchanges: the European Union and Asian countries have a common interest in preserving a cooperative, rules-based and peaceful international system, where multilateral organizations are the natural fora for reaching common solutions. This relationship needs to rely on effective, functioning and sustainable connectivity, in other words on the physical and non-physical infrastructure through which goods, services, ideas and people can flow unhindered.
While connectivity has always been a part of the EU’s policy towards Asia, until now the EU has not used its potential in this area to the full. That is why we have proposed this week a new policy framework to step up the EU action, an EU strategy on connectivity between Europe and Asia.
Our message is clear: the European Union is ready to step up its engagement with Asian partners on an agenda for connectivity, based on mutual interests and common objectives. Connectivity is in the very DNA of the European Union, as a political project based on market integration. We can offer our regulatory experience, technical expertise and funding opportunities at the service of projects that help interoperability and convergence, promote fiscally and environmentally sound growth, and strengthen our connections in a way that will be beneficial for us all.
We can do this in three ways. Firstly, the EU is ready to support new connections and networks between Europe and Asia. For example, extending our Trans-European Transport Network, which facilitates trade and mobility through removing technical and regulatory barriers for transport networks and modernizing infrastructure to other non-EU countries would be a positive step. We will also pursue a sustainable digital agenda with Asia in order to foster universal and affordable access to digital technologies and services. We will share our experience in creating regional, liberalized energy markets with a focus on market-driven transformation towards clean energy. And we will continue to promote human exchanges and mobility through programs such as Erasmus or the Marie Curie Action as a way to build connections, mutual understanding and share ideas.
Secondly, in the EU approach, connectivity can only be built in partnership. Therefore, we will work hand in hand with regional organizations and mechanisms in Asia, such as ASEAN, to identify and support projects. Many such partnerships exist already. Currently, the European Union and ASEAN are negotiating an aviation agreement. The Philippines is also part of a number of regional projects like EU ARISE Plus which covers areas including trade facilitation, intellectual property rights, and civil aviation as well as the E-READI, an EU-ASEAN dialogue instrument that facilitates dialogue forums between the EU and ASEAN on policy areas across all three ASEAN community pillars: political and security; economic; and socio-cultural. The EU also supports the Philippines in the attainment of the country’s rural electrification targets through the EU Access to Sustainable Energy Programme (ASEP). Furthermore, the recently concluded EU-Philippines Partnership and Cooperation Agreement (PCA) lays a comprehensive foundation for strong bilateral cooperation in many areas including — among others — trade, investment, development, and transport policies.

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We will work hand in hand with regional organizations and mechanisms in Asia, such as ASEAN, to identify and support projects.

We will work hand in hand with regional organizations and mechanisms existing in Asia, such as ASEAN, to identify and support projects.
Thirdly, we want to work on a connectivity based on shared principles: transparency, non-discriminatory market practices, a level playing field for economic operators, protection for intellectual property rights. The best way to achieve this is not to impose anyone’s standards or rules, but to work together within international organizations on mutually acceptable ones. European companies must have a level playing field vis-à-vis their competitors and have the same access to markets abroad as others have in the EU.
Finally, we will mobilize all our levers to back projects with adequate funding, using to the full the potential of the European Investment Bank and of the new tools for external investment policy available under the EU budget. According to the Asia Development Bank, Asia will require over €1.3 trillion a year of infrastructure investment in the coming decades. The EU is ready to support Asian countries meet such an investment challenge leveraging public and private financing through a combination of grants, guarantees, lending and blending. Yet, investment must be fiscally viable and financially sustainable. The EU will only support projects that mobilise domestic resources, create value for local communities and are sustainable in the long term.
Together, Europe and Asia account for almost 70% of global population and over 60% of the world’s GDP. There is space for making our ties stronger and more mutually beneficial. Sustainable connectivity, based on strong partnerships and transparent rules, is for the EU, European and Asian countries, the best way forward.
 
Federica Mogherini is Vice-President of the European Commission and High Representative of the European Union for Foreign Affairs and Security Policy.

ARMM budget may be realigned to fund BOL plebiscite, says Hataman

A PORTION of the Autonomous Region in Muslim Mindanao’s (ARMM) 2019 budget may be realigned for the Bangsamoro Organic Law (BOL) plebiscite in Jan. in case funding for the referendum does not come on time, “We support the BOL all the way and budget should not be a problem; we are recommending to allow part of the ARMM proposed budget to be used for the plebiscite,” ARMM Gov. Mujiv S. Hataman said in a statement on Sunday. Mr. Hataman made the pronouncement amid reports that there is no allocation in the P3.757-trillion 2019 national budget for the BOL referendum, which requires P857 million. Lawmakers have also said that the P10-billion budget submitted by the Commission on Elections for 2019 does not include expenditures for the plebiscite. Mr. Hataman said Congress may realign over P800 million for the plebiscite from the P10.1 billion infrastructure fund for the ARMM next year. The region’s P32-billion budget for 2019 was approved at the House of Representatives plenary on Sept. 20. Republic Act No. 11054, or the Organic Law for the Bangsamoro Autonomous Region in Muslim Mindanao (BARMM), was signed on July 26. The Jan. plebiscite seeks to formally create the BARMM, comprising of all areas under ARMM, and affirm or reject the inclusion of the cities of Cotabato and Isabela as well as six towns in Lanao del Norte and 39 barangays in North Cotabato. “It is vital that the plebiscite take place as scheduled,” Mr. Hataman said, “We are looking at all the options open to us, including realignment of regional government funds, because it is that important to the future of our region.”

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