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NEA lending to power co-ops up 23%

THE National Electrification Administration (NEA) said loans it extended to electric cooperatives (ECs) in the first half hit P1.29 billion, up nearly 23% from a year earlier.
“At least 46 of the 121 ECs supervised by the state-run agency have availed of P1.294 billion worth of loans, including calamity loans, during the first six months of the year,” said Leila B. Bonifacio, department manager of the NEA accounts management and guarantee department, in a statement.
Of the total, P755 million went to 36 electric cooperatives for their capital expenditure projects while P80 million was borrowed by four ECs for the rehabilitation of their power distribution systems that were damaged by typhoons Lawin, Urduja and Vinta.
NEA extends calamity loans with a 10-year repayment term. The loans have a maximum grace period of one year at an interest rate of 3.25% per annum.
NEA Administrator Edgardo R. Masongsong said the loan facility is part of the agency’s response to President Rodrigo R. Duterte’s directive of speeding up rural electrification and removing all barriers to the country’s total electrification.
“We hope to capacitate the electric cooperatives with the infusion of much needed funds to expedite their projects and initiatives,” he said.
Loan availments by the ECs are fast-tracked by the agency. Loans are released with 24 working days for regular loans, 13 days for short-term loans and seven days for calamity loans.
This year, Quezon I Electric Cooperative, Inc. obtained P20 million to finance its monthly shortfall in the settlement of power accounts with generation companies and privately owned National Grid Corp. of the Philippines.
Zamboanga City Electric Cooperative, Inc. availed of a stand-by credit loan facility for power accounts amounting to P145-million to strengthen its creditworthiness with generation companies.
Three power cooperatives in Mindanao — Misamis Oriental II Electric Cooperative, Inc., Sultan Kudarat Electric Cooperative, Inc., and Agusan del Norte Electric Cooperative, Inc. — obtained P74 million worth of loans for the procurement of modular generator sets.
The NEA also provided working capital loans totaling P220 million to Abra Electric Cooperative, Marinduque Electric Cooperative, Inc., Sorsogon I Electric Cooperative, Inc., Camotes Electric Cooperative, Inc., Negros Oriental I Electric Cooperative, Inc., and Misamis Oriental II Electric Cooperative, Inc.
In the first half of 2017, NEA extended P1.05 billion worth of loans to 36 ECs to finance their electrification projects and rehabilitate typhoon-damaged distribution lines, among others. — Victor V. Saulon

The 2019 budget: Building a bright future for the Philippines

By Benjamin E. Diokno
AS SOON as we assumed office, we adopted measures to put an end to underspending. We put in place a number of budget reforms, including limiting the validity of appropriations to one-year from two years.
These measures worked, cutting underspending to only P96.3 billion in 2016, and P85.2 billion in 2017. This downward trend continues.
As of May 2018, actual spending exceeded the program by P15.2 billion due to the frontloading and fast-tracking of existing programs and projects.
To further modernize our budgeting system and move it to the realm of international good practices, we are shifting to an Annual Cash-Based Appropriations wherein obligations or contracts for programs, activities, and projects entered into are limited to those that can be fully delivered by the end of the fiscal year.
In the preparation of the budget, the review of the Department of Budget and Management considered the agency’s implementation capacity and a project or program’s implementation-readiness. The shift is expected to increase the efficiency of government operations through better agency planning. Agencies will be measured not on contracts awarded (or obligated) but on the actual delivery of public goods and services.
FISCAL PROGRAM
Given the country’s stage of development and decades of underinvestment in physical infrastructure, the government will continue to adapt an expansionary fiscal policy.
Revenues are targeted to reach P2.846 trillion in 2018 and P3.208 trillion in 2019, equivalent to 16.2% and 16.5% of GDP, respectively. The revenue levels include the additional P89.9 billion and P181.4 billion from the implementation of the Tax Reform for Acceleration and Inclusion (TRAIN) law in 2018 and 2019, respectively.
For 2019-2022, the Comprehensive Tax Reform Program includes Package 1B and Package 2+ which is expected to generate an average of P268.3 billion, equivalent to 1.2% of GDP, in additional revenues per year. This will help revenues grow by an average of 12.7% per year to reach P4.588 trillion or 17.6% of GDP by 2022, compared to P2.473 trillion or 15.7% of GDP in 2017.
For 2019, the Development Budget Coordination Committee (DBCC) is adjusting the deficit slightly upwards to 3.2% of GDP, from the previous 3% target in order to accelerate investments in social services, particularly education and social protection, as well as to fast-track countrywide infrastructure development through the “Build, Build, Build” Program. This tax-expenditure mix will allow us to meet our goal of being an upper middle-income economy by 2022.
For 2020 to 2022, the deficit target will revert to 3% of GDP, as we remain committed to long-term fiscal sustainability.
As a result, disbursements will increase by an average of 12.3% annually to reach P5.362 trillion or 20.6% of GDP by 2022, from P2.824 trillion or 17.9% of GDP in 2017. This expansionary fiscal policy is expected to sustain the growth momentum with GDP expanding by 7% to 8% from 2018 to 2022.
Our fiscal strategy remains prudent and sustainable.
Despite a slight deficit adjustment in 2019, the country’s debt-to-GDP ratio continues on a downward trajectory, although marginally higher by an average of 0.2 percentage point when compared to our original program. The debt-to-GDP ratio is still projected to decline from 42.1% in 2017 to 38.8% by 2022. By contrast, it was a high of 74.4% in 2004 and 52.4% in 2010.
This declining debt-to-GDP trajectory will be supported by a financing strategy that will continue to favor domestic sources; the gross borrowing mix of 75:25 over the medium-term will be maintained. It will result in better debt management by balancing the need to explore new markets for the country’s financing requirements and the need to minimize exposure to foreign exchange fluctuations.
MACROECONOMIC ASSUMPTIONS
The Philippine economy grew by 6.8% in the first quarter of 2018, making the Philippines as one of the best performing economies in Asia. For 2018 to 2022, we are maintaining our growth target of 7% to 8%
INFLATION
From year-to-date, inflation averaged 4.3%, which is within the 4-4.5% forecast for the year despite hitting 5.2% in June 2018. Potential second-round effects from increase in prices will be mitigated through a set of measures provided for under the Tax Reform for Acceleration and Inclusion (TRAIN) Law and other measures such as the (1) unconditional cash transfers; (2) Pantawid-Pasada Program; (3) measures to be implemented by the Department of Trade and Industry such as setting standard retail prices for basic agricultural goods and expanding price monitoring covering more stores; and (4) “Tulong sa Bayan” project, providing affordable quality rice. Additionally, we are strongly pushing for the passage of the rice tariffication bill which could reduce the price of rice anywhere from P4 to P7 per kilo.
DUBAI CRUDE OIL PRICE
Dubai Oil averages at $67.98 per barrel YTD. Current oil prices surged to levels last seen in 2014 as tensions between the US and Iran could affect global supply. The Dubai Oil Price Assumption is raised to $55-70 per barrel this year, but maintained at $50-65 per barrel for 2019-2022 in line with forecasts that the world oil prices would decline in the years ahead.
EXCHANGE RATE
The exchange rate averaged at 51.94 P/US$ from January to June this year. The peso depreciation is mainly due to oil price surges and the expected US Fed rate hikes as well as market concerns on the widening of the country’s current account deficit. Over the medium term, the peso-dollar exchange rate assumptions is raised to P50-P53 per dollar.
364-DAY T-BILL RATE
The 364-day T-bill rate, which is the bellwether rate for budgetary purposes on interest rates, was pegged at 4.24% in May, pushing the YTD average to 3.9%. Over the medium-term, the DBCC set the forecast range up to 3.0-4.5% from 2.5-4.0%. The trend in T-bill rates will continue to be influenced by the policy actions by the BSP and the US Fed.
180-DAY LIBOR
The London Interbank Offered Rate (LIBOR) is maintained at 2-3% for 2018-2022.
KEY BUDGET DIMENSIONS
The FY 2019 budget will amount to P3.757 trillion, equivalent to 19.3% of GDP.
By Expense Class. Personnel Services (PS) expenditures will be allocated with P1,185 billion, taking the largest share, equivalent to 31.5% of the 2019 budget. This is primarily to cover the increase in the pay of government employees and the Military and Uniformed Personnel (MUP) pursuant to E.O. No. 201 s2016 and J.R. No. 1 s2018, respectively, the higher pensions of the Military and Uniformed Personnel, and the new positions in the health, social welfare departments and other agencies to absorb the contract of service and job order employees.
Capital Outlays will have the second-largest share, representing one-fifth of the proposed budget at P758.4 billion to cover the requirements for flagship infrastructure projects under the Build, Build, Build Program of the government.
Maintenance spending, meanwhile, will be allotted with P557.5 billion or 14.8% of the proposed budget, mainly for the implementation of major banner social programs, namely K-12 program (DepEd), Pantawid Pamilyang Pilipino Program (DSWD), Universal Access to Quality Tertiary Education (CHEd) and Universal Health Program (DoH).
Government-owned or -controlled corporations (GOCCs) will be supported with some P187.1 billion, accounting for 5% of the total appropriations. This is composed largely of the requirements for the premium subsidy of health insurance premiums under the National Health Insurance Program of the PHIC (P67.4 billion), Tax Reform Cash Transfer Project (P36.5 billion) and irrigation projects of the NIA (P36.9 billion).
Transfers to LGUs will also receive significant allocations, amounting to P640.6 billion and accounting for 17.1% of the proposed total cash-based appropriations. These consist largely of the Internal Revenue Allotment (P575.5 billion), Local Government Support Fund (P34.3 billion) and Special Shares of LGUs (P27.3 billion).
Debt burden will comprise 11% of the budget up by 1.2 percentage points from the 9.8% distribution this year due to higher financing requirements, interest, and foreign exchange rates.
By Sector. The allocation by sector is consistent with the administration’s priorities in infrastructure and human capital development. This is reflected by the biggest allocations for the social services and economic services sectors, amounting to P1.377 trillion (36.7% share) and P1.068 trillion (28.4% share), respectively. General Public Services sector will be allocated with P709.4 billion (18.9%), Debt Burden with P414.1 billion (11%) and Defense with P188.2 billion (5%).
In terms of growth of the sectors, the defense sector and public order and safety under the General Public Services will increase by about 16.5% and 19.5% due to the provision of the salary increase of the Military and Uniform Personnel (MUP) including the related pension requirements.
By Department. With the shift to cash-based budgeting, the more appropriate comparison is the 2019 Proposed Cash-Based Budget and the Equivalent 2018 Monthly Disbursement Programs. Education is still considered the administration’s top priority with the combined budget of P659.3 billion.
Public infrastructure is also emphasized through the public works and transport departments at P555.7 billion and P76.1 billion, respectively. It is worth noting that out of all the key departments, the DoTr saw the largest growth at 89.3%.
The promotion of security and peace and order in the country also remains a top priority of the Duterte administration. This is reflected in the 30.9% increase in the budget of the Department of Interior and Local Government, amounting to P225.6 billion in 2019. Similarly, the budget of the Department of National Defense grew by 34.4%, amounting to P183.4 billion in 2019.
Social Welfare, composed of the budget of the Department of Social Welfare and Development (DSWD) and the budget for unconditional cash transfers, is fifth with an allocation of P173.3 billion, higher by P8.9 billion or 5.4%. This will support the poverty-reduction efforts and social protection programs of the government. Further support for social programs is given through a budget of P141.4 billion for the health care programs under the Health department and the PhilHealth to provide affordable and accessible health care to Filipinos.
Rounding out the top 10 are the Department of Agriculture (DA), the Judiciary, and the Autonomous Region in Muslim Mindanao (ARMM).
EXPENDITURE PRIORITIES
Education continues to get the lion’s share of the 2019 budget, with a total funding of P659.3 billion, a 12.3% increase from last year’s P587.1 billion.
Infrastructure is also considered a top priority of this administration and for this purpose, we will propose an amount of about P909.7 billion for FY 2019, equivalent to 4.7% of GDP.
Under the infrastructure program, road networks will receive the largest share of the infrastructure budget at P346.6 billion, equivalent to 38% of the total infrastructure program. Meanwhile, construction of school buildings will have a budget of P37.6 billion in 2019.
Likewise, construction of flood control systems and irrigation systems will be allocated with P132.1 billion, and P26.3 billion, respectively. Railway projects will have a budget of P24.6 billion in 2019.
The administration’s banner social programs — Pantawid Pamilyang Pilipino Program, National Health Insurance Program, Universal Access to Quality Tertiary Education, Free Irrigation for Farmers, Basic Educational Facilities Program and Rice Subsidy for Military and Uniformed Personnel — will receive a total allocation of P283 billion.
The FY 2019 Budget was crafted with the people’s welfare in mind.
After all, the budget is born from the taxes of the people.
This budget guarantees a better and more comfortable life for most Filipinos. It is a budget that will support strong, sustainable, and equitable growth, a budget that will make the Philippines better, fairer, safer, greener and more beautiful than what it was the year before.
 
Benjamin E. Diokno is the Philippines’ Secretary of the Department of Budget and Management.

Preparing for federal government

Finally, after two years on the job, in his third SONA, Rodrigo Roa Duterte has delivered a statesmanlike speech, managing enough discipline for almost an hour with no obscenities. I am almost convinced that he is sincere in some of his intentions, even if we do not agree with his methods. Hopefully, as he goes further into the Presidency, he will also become more law-abiding and civil in his public behavior and statements. Who knows, he might even reverse himself on his challenges for someone to prove to him that God exists. He might even become kinder and more chivalrous toward competent women in leadership positions. Hope springs eternal.
I also got the feeling that despite survey findings indicating that the citizenry are not in favor of such a radical shift in governance, or are ignorant about it, President Duterte is dead set on a shift to a federal form of government. And now, with former President Gloria Macapagal Arroyo in charge of the House, she is likely to push hard for the shift. Apparently not content with her ten years in Malacañang, the new Speaker seems likely to work toward running Parliament; now that, by a sudden miracle, shazam, she no longer needs a neck brace, nor a wheelchair. This, despite no news of her traveling to Germany for her “life-threatening” rare spinal illness, certified to by her cardiologist (!).
A federal government is an appealing concept, and makes sense for an archipelago of people with so many languages and cultural idiosyncrasies. It also makes it possible, if we can get it right, to bring about more equitable access to national resources and opportunities. It also happens that the outlying provinces rightfully complain about what they refer to as “Imperial Manila.” Competition for investments among various autonomous regions might push us toward greater excellence and efficiencies across the country. Federal governments such as those of Malaysia and the United States seem to have fared better than ours. But let us remember that both countries actually united existing independent and self-governing states. We want to create new regional governments from a national government put together by colonialists who mobilized a country out of little island barangays. The colonial governments created municipal and provincial governments from tribal groups and islands, little communities, or really, almost from scratch.
After twenty years under an authoritarian government, President Corazon Aquino shifted swiftly from a revolutionary government under which she could rule by decree, to the new democratic Constitution of 1987 and lost no time in ensuring elections for the Senate and the House; followed by local elections. Four years later, she pushed for greater local political and fiscal autonomy, and signed the Local Government Code of 1991. This certainly energized the provincial areas, and enhanced local capacities in governance. There has been much improvement in the economies of provincial areas, particularly in the cities such as Cebu, Davao, Cagayan de Oro, and Iloilo in the Visayas and Mindanao areas which had erstwhile been languishing in underdevelopment.
However, I think that rather than proceed to a radical shift in governance structures this early in the game, we should take a look at how we can enhance and strengthen local governments. There is still much room for improvement without shaking up the whole system.
The way I see it, there are three things that can help improve governance at the local levels: one is to increase LGU share in national budget appropriations. Why do national agencies have to plan and build barangay roads, health centers and irrigation systems? Second, strengthen and professionalize the civil service all the way down to local governments. The third is to lessen frequency of elections, and lengthen terms of office of local chief executives from the current three years to six years. As it stands now, local chief executives and their key people (who tend to be replaced with each administration) spend their first year learning the job, and the second year getting things done, and the third year campaigning for the next election. If there is a change in governments, the cycle is repeated.
National government agencies get to hire the most competent and well-prepared technocrats. They are paid more and get priority access to overseas training and post-graduate grants. The National Economic and Development Authority (NEDA) which administers foreign-assisted training grants keeps the grants for its own people; which is why NEDA technocrats tend to be more highly trained than ordinary bureaucrats.
Civil service regulations have not been seriously followed so that both national and local governments tend to have shaky and unstable bureaucracies in terms of policy continuity and competence. Civil service professionals should be protected from political instability. Whoever is in political power, the bureaucracy should be stable and dependable. This will help ensure stability and continuity in development initiatives and programs.
As in the case of the Presidency under the current Constitution, local government executives should have six-year terms with no succeeding re-election. They may run for the same posts after a hiatus of one term. And if they have done a decent enough job for their communities, they are likely to get elected once again.
Frequent elections cause instability in policy and governance; they are also expensive and is probably one of the likely causes, if not the number one cause of graft and corruption.
Now that the Bangsamoro Basic Law is about to be signed by the President, we have one model to learn from. We will learn how national and regional governments should work together, and how regional and local governments can coordinate. There are also issues on budget authority and allocation of resources. We will have to see if we can prepare local civil service executives to handle the increased autonomy that regional governments are supposed to get under a federal government. How do we motivate national government civil servants to move to the regional and local governments? How do we make adjustments in pay scales to enable equitableness? If we do not handle this well, we are likely to foment a great deal of restlessness and low morale, making governance and development difficult.
There are too many management issues to be addressed. This is not just a matter of formulating the legal frameworks. This is not just a job for lawyers. Can we make it work? Will things indeed be better for our people?
Again, a federal government seems like a good idea; but if we rush into it headlong, aren’t we risking disaster? Shouldn’t we first prepare our civil service and our politicians for this, under the present Constitution and the Local Government Code of 1991? This will probably mean less time needed for a so-called “transition period” which is a key issue to be tackled when the radical change is resorted to.
 
Teresa S. Abesamis is a former professor at the Asian Institute of Management and an independent development management consultant.
tsabesamis0114@yahoo.com

SONA’s health care agenda missed integrated cancer control

During the President’s third State of the Nation Address (SONA), he raised a number of issues, that span political and economic reforms.
The SONA seemed to be a hodge-podge report of events already well known to the Filipino people instead of a more strategic summary of his achievements and plans in the coming years.
Among the political issues raised that are not new including the government’s war on drugs; passage of the Ease of Doing Business Act; due signing of the enrolled bill of the Bangsamoro Basic Law; and Philippines’ independent foreign policy, among others.
On environmental issues, the President maintained the administration’s agenda in attaining a holistic and sustainable management of land resources.
On socioeconomic issues, President mentioned his campaign to end contractualization; entry of a third major player in the telecommunications industry; increase of salary of the military and police force; and passage of the Tax Reform for Acceleration and Inclusion Law, among others.
Disappointingly, the President failed to substantiate these so-called accomplishments if only to put some new spice into it. Equally so, the President only passed through the gut issue of inflation now affecting all Filipino consumers. Disturbing is his twit on human rights versus human life to further rationalize the violence of his relentless war on drugs.
One of the few points that the President laid out was the health care system. President Duterte emphasized the need to protect its citizens from financial health risks. He had promised to provide affordable health care to every Filipino.
In what seemed to be a fresh take on the issue, he had asked the agencies to streamline processes for financial assistance. More than financial assistance, access to affordable and quality health care can only be achieved through the joint efforts of the public and private sectors.
Aside from institutionalizing the unified implementation of the No Balance Billing Policy, the President has urged the Congress for its speedy passage of the Universal Health Care Bill. As it is now, delivery of health care has indeed been fragmented, as observed by the President. While a number of investors has ventured into health systems, there remains resource gaps.
The President likewise talked about institutionalizing primary health care as a prerequisite to accessing a higher level of health care. While the Universal Health Care Bill is aimed at providing primary, preventive, curative, palliative and rehabilitative care, patients of debilitating illnesses deserve a higher level of health care. One such debilitating illness is cancer, which has alarmingly affecting more and more Filipinos and is now the third highest cause of death in the country.
In addition to the Universal Health Care Bill, the President and his health policy advisers overlooked a landmark legislation now pending in Congress. Since the President is already mindful of the urgency and importance of providing holistic approach to health care, a big and very positive surprise would have been to prioritize a long neglected health issue that cuts through the whole political and economic spectrum of Philippine society. The bill already has the support of more than 200 members of the House of Representatives and a majority of the Senate and will soon be up for second reading.
At one point, the President stated that actions will be taken that are of “greatest good” to the “greatest number of people.” Health care reform including an integrated response to cancer control is certainly a legacy that will directly benefit all Filipinos and if implemented well, will be remembered for generations.
 
Kaye Clemente-Lua is the Executive Director, Stratbase ADR Institute.

If Duterte had ad-libbed his SONA

President Rodrigo Duterte has just delivered the traditional State of the Nation Address and folks are amazed that, (1) it was relatively short, (2) he stuck to the written speech and, (3) he did not ad-lib or swear.
While his supporters may be happy about this, they really should have cause to worry, because the President of the Philippines was not himself — we mean, his usually profane, barumbado, bastos, funny, and memorable self (this SONA may go down in the books as forgettable).
It’s like seeing a usually rambunctious and noisy child suddenly becoming quiet and well-mannered. A parent usually worries when something like that happens.
Was Duterte sick or something? Or has he finally gotten tired of being head of the nation and longs to go back to his comfort zone in Davao?
At any rate, those of us who have been following Duterte’s speeches and public pronouncements are convinced that he may have been finally intimidated by Mayor Sara Duterte (“You better behave or I’ll send you back to Davao, you hear???”) and had agreed to act presidential.
But what we can’t help speculating on is what he would have ad-libbed, if Duterte had not been muzzled and virtually locked into his prepared speech.
Here are a few excerpts, based strictly and purely on speculation and on past experience (the ad-libs are in parenthesis):
STATE OF THE NATION ADDRESS BY PRESIDENT DUTERTE
Kindly sit down. Thank you for your courtesy. (Daghang salamat sa inyong tanan.)
Senate President Vicente Sotto III and the members of the Senate (Uyyy, Tito I saw you on Eat Bulaga, ang galing mong comedian…mag-comedy ka na lang); House Ex-Speaker Pantaleon Alvarez (Sinabi na sa iyo, huwag mong babanggain si Sara) and the members of the House of Representatives; Ex-Vice President Maria Leonor Robredo (Nasa’n si Bongbong?); Former Presidents Fidel V. Ramos, Joseph Ejercito Estrada, and Speaker Gloria Macapagal-Arroyo (Sabi nga ni MacArthur, “I shall return!”); His Excellency Gabriele Caccia and the esteemed members of the diplomatic corps; Executive Secretary Salvador Medialdea and the members of the Cabinet; Acting Chief Justice Antonio Carpio and the justices of the Supreme Court; my fellow workers in government; mga kababayan.
About two years ago, I solemnly took my oath as a worker of the national government. I was as inspired to institute real changes for the greater good of the Filipino people, as I was greatly overwhelmed then by the daunting challenges that lay ahead. (Tanong ko sa sarili ko…putang ina, kaya ko ba ito? Aaah, basta bahala na si Batman!)
Two years later, my solid commitment to directly and decisively address our nation’s collective challenges remains (Sumulong ng kaunti, pero umurong din…putang ina, mahirap palang maging president). It has not wavered. In truth, it has even gotten stronger through adversity and the desire to give the people the most we can, within my term in this government (Pero, sa tutoo lang…kulang talaga ang six-year term para ma-solve ang mga putang inang problema ng bayan!).
Let me begin by putting it bluntly: the war against illegal drugs is far from over (Akala ko makakayanan ng six months…iyon pala maski six years, hindi pa rin kaya!). Where before, the war resulted in the seizure of illegal drugs worth millions of pesos, today, they run [into] billions in peso value. I can only shudder at the harm that those drugs could have caused had they reached the streets of every province, city, municipality, barangay and community throughout the country.
This is why the illegal drugs war will not be sidelined. Instead, it will be as relentless and chilling, if you will, as on the day it began. These drug dealers know fully well that their business is against the law. They know the consequences of their criminal acts, especially when caught in flagrante delicto and they violently resist arrest. They know that illegal drugs waste away lives, dysfunctionalize families (Ooppps…mabigat yatang terminology iyan…pinahihirapan ako ng putang inang speech writer) and ruin relationships. They know that once hooked, addicts will die slowly — slow deaths. And yet, they persist in doing what they do, oblivious to the terrible harm that they cause to the people and communities.
And when illegal drug operations turn nasty and bloody, advocates of human rights lash at — and pillory — our law enforcers and this administration to no end. Sadly, I have yet to hear really howls of protest from the human rights advocates and church leaders against drug-lordism, drug dealing and drug pushing as forceful and vociferous as the ones directed against the alleged errant [law] enforcers in the fight against this social scourge (Gusto niyo, kayo ang mag-take over…tingnan natin kung hindi rin kayo pumatay ng tao!).
If you think that I can be dissuaded from continuing this fight because of [your] demonstrations, your protests, which I find, by the way, misdirected, then you got it all wrong (Putang ina!). [applause]
Your concern is human rights, mine is human lives. [applause] The lives of our youth are being wasted and families are destroyed, and all because of the chemicals called shabu, cocaine, cannabis, and heroine (At saka, Fentanyl at opioid, pero huwag na nating pag-usapan iyan).
Human rights to me means giving Filipinos, especially those at the society’s fringes, a decent and dignified future through the social and physical infrastructures necessary to better their lives. The lives and freedoms and the hard-earned property of every Filipino whose condition we wish to improve shall be protected from criminals, terrorists, corrupt officials, and traffickers [of] contrabands.(Haaa? Okay ba?)
You worry about the present; I am concerned [about] both the present and the future. [applause] I worry about the future because I know what crimes can do to the youth of this country. If not stopped, crimes can make human cesspools of succeeding generations. I will not allow it to happen. Not during my term (Putang ina nilang lahat!). [applause]
Time and again, I have stressed that corruption must stop. [applause] Corruption is like a leech that it bleeds the government of funds programmed for its infrastructure and other social development projects. It saps the morale or the morale of dedicated and honest government workers (Pero, anak ng tinapay, kung ang mga botante, hingi nang hingi ng pampalibing pang-matrikula, pang-ospital, pampakasal, na akala mo bangko ang politiko, paanong hindi mapipilitang magnakaw???).
Corruption destroys those who succumb to its temptation and eventually it is the innocent who will suffer and bear its horrible consequences (Haaa?? Okay ba??? Ang galing ng speech writer…parang tutoo!).
The love of money is corrosive. And sadly, the desire to make the easy kind by being imaginative and manipulative, corrupts absolutely. Stolen wealth does not make the thief respectable. Neither will the trappings of wealth mask [nor] cap the stink that thievery exudes. One day, justice will catch up with those who steal government funds. And when that day comes, it will be the public who will have its retribution (Overacting na yata ang putang inang speech writer… pambobola na ito!).
(I better stop reading this speech. Ipa-distribute ko na lamang sa inyo ang kopya. Nandiyan ang detalye na mga economic programs at iba pa. Basahin niyo na lang. Pero ang speech na ito…parang hindi ako ito. Hindi mukhang sincere at halatang gawa-gawa lamang nina Roque at Andanar.)
(Daghang salamat sa inyong tanan!)
 
Greg B. Macabenta is an advertising and communications man shuttling between San Francisco and Manila and providing unique insights on issues from both perspectives.
gregmacabenta@hotmail.com

Peso climbs on easing tensions

THE PESO rose on the back of improved risk sentiment.

THE PESO strengthened further against the dollar on Tuesday amid risk-on market sentiment due to subdued geopolitical noise abroad.
The peso ended the session at P53.42 versus the greenback on Tuesday, six centavos stronger than the P53.48-per-dollar finish on Monday.
The peso opened the session at its intraday low of P53.54 against the dollar. The session’s best, meanwhile, stood at P53.42 versus the greenback.
Dollars traded surged to $668.1 million from the $399.6 million that exchanged hands the previous day.
A foreign currency trader said the peso strengthened anew as the market’s risk appetite improved.
“The peso appreciated [as] risk-on market sentiment prevailed amid optimism on corporate earnings reports,” the trader said in an e-mail.
The trader added that the peso strengthened amid lack of recent geopolitical noise, prompting the market to take profits versus the greenback.
Meanwhile, UnionBank of the Philippines chief economist Ruben Carlo O. Asuncion said Asian markets rallied on China’s spending plan increase to help growth.
Reuters reported that China’s cabinet said the country would adopt a more “vigorous” fiscal policy to support growth amid economic headwinds.
The Chinese central bank also lent $74 billion to financial institutions through one-year medium-term lending facility to support lending.
“Domestically, the market seem unmindful of the recent House leadership change,” Mr. Asuncion added.
Pampanga Rep. Gloria Macapagal-Arroyo yesterday took over as the new speaker of the house, replacing Davao del Norte Rep. Pantaleon D. Alvarez. Prior to President Rodrigo R. Duterte’s State of the Nation Address on Monday, Ms. Arroyo walked up the Speaker’s rostrum and took an oath despite the lack of a formal vote by House members.
For Wednesday, the trader and Mr. Asuncion expect the peso to move between P53.30 and P53.50.
“The local currency is likely to continue gaining strength ahead of possible hawkish cues from European Central Bank policy meeting tomorrow that might be favorable to the euro over the dollar,” the trader noted. — Karl Angelo N. Vidal

Bourse coasts with no surprises in Duterte speech

By Arra B. Francia, Reporter
STOCKS climbed back above the 7,400 mark on Tuesday as investors digested President Rodrigo R. Duterte’s State of the Nation Address (SONA) the day before.
The 30-company Philippine Stock Exchange index (PSEi) increased by 70.22 points or 0.95% to end 7,447.02, while the broader all-shares index added 31.91 points or 0.71% to close 4,505.23.
“Price action looked rather hesitant… early in the morning as the market consolidated post-SONA comments, but later managed to churn out modest gains,” Regina Capital Development Corp. Managing Director Luis A. Limlingan said in a mobile phone message.
In his annual speech to the joint session of Congress on Monday, Mr. Duterte warned of a continued war on drugs and corruption and asked lawmakers to ratify a law that would give Moros greater autonomy in a wider area, as well as approve the remaining three to four tax reform packages, among other reforms. Monday also witnessed the dislodging of Rep. Pantaleon D. Alvarez of Davao Del Norte’s first district from the speakership by former president Pampanga Rep. Gloria M. Arroyo (second district), an economist — a development generally welcomed by business leaders.
Papa Securities Corp. trader Gabriel Jose F. Perez said the president’s SONA may have eased hesitation felt by investors last week, hence, propelling the main index.
Reuters reported that financial stocks fueled the S&P 500 and the Nasdaq Composite Index to gain 5.15 points or 0.18% to 2,806.98 and 21.67 points or 0.28% to 7,841.87, respectively, though the Dow Jones Industrial Average gave up 13.83 points or 0.06% to 25,044.29. Major Asian markets — in Japan, China and Hong Kong — were generally positive.
Back home, financials were the lone sub-index that fell — by 5.13 points or 0.27% to 1,831.18.
The other five sectoral indices gained at the ringing of the closing bell: mining and oil by 2.22% or 217.08 points to 9,959.82, holding firms by 1.73% or 123.86 points to 7,275.78, services by 1.01% or 14.62 points to 1,456.19, property by 0.94% or 34.34 points to 3,666.22 and industrials by 0.11% or 11.76 points to 10,650.42.
Some 2.65 billion shares worth P4.43 billion changed hands, compared to 657.02 million worth P5.08 billion on Monday. Stocks that advanced outnumbered those that declined, 107 to 92, while 43 names were unchanged.
Foreigners recorded net sales of P47.96 million, a reversal of Monday’s P195.99-million net buying.
Fourteen of Tuesday’s 20 most active stocks ended in positive territory, led by a 5.15% increase in stocks of Bloomberry Resorts Corp. to P10 apiece.
Also among those that gained the most were Semirara Mining and Power Corp. (up 4.92% to P33.05); Globe Telecom, Inc. (up 3.39% to P1,799) and SM Investments Corp. (up 3.05% to P912 apiece).

House ratifies Bangsamoro Organic Law

By Charmaine A. Tadalan
THE HOUSE of Representatives (HoR) ratified on Tuesday the Bangsamoro Organic Law (BOL) after one day’s delay by the sudden leadership change in the chamber.
Deputy Speaker Fredenil H. Castro moved to ratify the bicameral committee report on the draft law when session resumed Tuesday afternoon. A day earlier, before President Rodrigo R. Duterte’s scheduled State of the Nation Address, the Senate ratified the BOL.
Former president Rep. Gloria M. Arroyo, the new House Speaker, said Tuesday in an interview with reporters, “I view my role as Speaker with having a primary specific objective that is to carry out the legislative agenda of President Rodrigo Roa Duterte and that means for today, we must get the BOL ratified.”
Senate Majority Leader Juan Miguel F. Zubiri, for his part, welcomed the House ratification of the BOL.
“I am overjoyed at the House of Representatives’ decision to prioritize the ratification of the Bangsamoro Organic Law, making it their first order of business during today’s session despite ongoing concerns in their leadership,” Mr. Zubiri said in a phone message, Tuesday.
“I eagerly await the President’s signature, turning this into law, and it is my hope that this signing will mark a new era of just and dignified peace for our brothers and sisters in Muslim Mindanao,” he added.
Mr. Duterte, in his third report to the Nation, said he needs up to 48 hours to review and sign the BOL.
The BOL establishes the Bangsamoro Autonomous Region in Muslim Mindanao (BARMM), which shall include existing areas under the ARMM.
Voters in the areas concerned will determine in a plebiscite scheduled later this year whether to approve or reject the BARMM, 90 to 150 days after its signing into law.
The 39 barangays in North Cotabato and six municipalities in Lanao del Norte, which have been included in the proposed Bangsamoro region, may also opt to be included.
A Bangsamoro Transition Authority (BTA) will be created with 80 members appointed by the President. Incumbent officials in the regional government shall be included in the BTA until their term ends in June 2019.
The Bangsamoro Government shall be headed by a Chief Minister elected by representatives.
The other half shall be divided into district representatives and sectoral representatives, representing Non-Muslim indigenous peoples, the youth, women, and settler communities, among others.
The Bangsamoro region will also be granted taxation powers with a 75-25 sharing scheme for national taxes collected in the region, in favor of the Bangsamoro.
Further, an annual block grant will automatically be appropriated to the region. The grant is equivalent to 5% of net national revenues collected by the Bureau of Internal Revenue and the Bureau of Customs.

Sotto: Duterte almost walked out of SoNA

THE THIRD State of the Nation Address (SONA) almost didn’t happen after President Rodrigo R. Duterte threatened to walk out of the Batasang Pambansa due to the unexpected change in leadership at the House of Representatives last Monday, Senate President Vicente C. Sotto III said on Tuesday.
Mr. Sotto, who was with Mr. Duterte before he delivered his SONA, said he sensed “displeasure” from the President with what was happening.
“’Wo-walk out na lang ako kapag hindi nila inayos ‘yan (I will just walk out if they don’t settle this matter). ‘Something to that effect,” Mr. Sotto said of Mr. Duterte’s response to the power play at the House between Representative Gloria Macapagal-Arroyo of the 2nd District of Pampanga and House Speaker Pantaleon D. Alvarez, who would thereafter be ousted in an election following Mr. Duterte’s report to the nation.
Asked if Mr. Duterte would have walked out of his own SONA, Mr. Sotto told reporters, “Yes, he gave a threat to that effect.”
House Majority Leader Rodolfo C. Fariñas then reminded Mr. Duterte of his constitutional mandate to deliver his SONA under Article VII, Section 23, of the 1987 Constitution, which states, “The President shall address the Congress at the opening of its regular session. He may also appear before it at any other time.”
The Senate has yet to receive a transmission from the House of any changes of leadership, Mr. Sotto said, adding that the Senate will have a “wait-and-see” attitude toward the new House leadership.
Also asked about Monday’s standoff at the House, Presidential Spokesperson Harry L. Roque, Jr. said in his press briefing Tuesday, “Unfortunately,…pinabalik na ako sa upuan ko ni ES. (I was asked by the Executive Secretary to return to my seat.) So I wouldn’t know.”
”ES…,will be in a better position because ES was right there mediating,” Mr. Roque also said.
Asked about the atmosphere at the House, he said: “Oh my goodness, you better believe it. Tempers were really flaring all over the place. But—they all have to behave, because the President was around, of course.” — Camille A. Aguinaldo and Arjay L. Balinbin

Senators, business leaders differ on Arroyo as Speaker

By Camille A. Aguinaldo and
Arjay L. Balinbin Reporters
SENATORS ON Tuesday responded with caution or suspicion toward former president Gloria Macapagal-Arroyo’s assuming the leadership of the House of Representatives, following a power play at the chamber on Monday night.
On the other hand, business leaders sought for comment said they “welcome” or “look forward” to Ms. Arroyo’s new stint, citing her background as an economist.
Ms. Arroyo, the 2nd-district representative of Pampanga, was elected the new Speaker soon after President Rodrigo R. Duterte’s State of the Nation Address, which was delayed by more than an hour in the course of that power play that toppled Pantaleon D. Alvarez of the 1st district of Davao del Norte from the House leadership.
Senator Panfilo M. Lacson in a statement warned the Senate will assert its role in the Duterte administration’s legislative agenda of constitutional amendments.
“Regardless of whether it was Rep. Arroyo or somebody else replacing the ousted Speaker, what happened yesterday is a strong argument against a parliamentary form of government where patronage politics plays a major, if not the only, role in selecting our country’s top leader,” Mr. Lacson said.
He added: “If GMA’s (referring to Ms. Arroyo) ascension to the speakership is a prelude to becoming Prime Minister, they better think twice because the Senate, both majority and minority, have agreed to close ranks to defend and assert our role under the 1987 Constitution in revising or amending the same. That, I can say with certainty and conviction.”
Senator Grace S. Poe-Llamanzares said she also opposes Ms. Arroyo’s election to the Speakership, citing the country’s political situation under her presidency. The senator’s father, the late movie actor and presidential candidate Fernando Poe Jr., lost to Ms. Arroyo in the highly controversial 2004 presidential elections, which was hounded by allegations of poll fraud.
“Let us wait if the leaders of Congress railroad this Cha-cha and make it a parliamentary form. We can wake up (to) either the President elected ha(ving) equal powers or (Ms. Arroyo) tak(ing) over as Prime Minister,” Ms. Llamanzares said in an interview with reporters.
“The President was elected because the people want change. I, too, want change, but the change that will be good for all of us, not the change that will pull us to a desperate situation,” she added.
Senator Joseph Victor G. Ejercito for his part told reporters: “It doesn’t look good that the President mentioned that he will be relentless with the war against drugs and corruption. While there are ongoing cases, GMA assumed Speakership.”
Mr. Ejercito’s father, former president and now Manila Mayor Joseph Ejercito Estrada, was ousted by a populist movement that catapulted Ms. Arroyo to the presidency. “We can forgive but we will never forget the sins of the past,” Mr. Ejercito also said.
Opposition Senator Francis N. Pangilinan said in a statement: “The maneuverings show the underbelly of politics that turn good people off from serving in government. The battle for House speakership is political infighting among those in the administration. The Liberal Party does not wish to be part of this spectacle.”
Among the business leaders sought for comment, president Danilo C. Lachica of the Semiconductor and Electronics Industries in the Philippines Foundation, Inc. (SEIPI), said, “From our perspective, we don’t see any major concerns in terms of the industry. Ang advantage lang with (The advantage is that) GMA is familiar with the electronics industry because as president she’s been invited to our fora. She’s familiar with that. We did meet once with GMA about the TRAIN (Tax Reform Acceleration and Inclusion) (law), but it was a positive thing….She’s an economist and she’s familiar with the industry.”
Acting president Sergio Ortiz-Luis of the Employers Confederation Of The Philippines (ECOP) said, “Expected na yun, matagal na balita na yun. Ang alam lang namin, ayaw ni GMA noong una.” (That was expected, it’s [old] news. What we knew was that she didn’t want [the Speakership post] at first.)
With Ms. Arroyo at the helm of the House, “I guess some of those crazy proposed laws, mag-iisip isip ([lawmakers] will think first). Marami kasi roon kung ano-anong klaseng law pinagpapasa eh (They’ve been passing all kinds of laws). And then being economist, I think magfofocus na roon sa magagandang bills (they will focus on better bills).”
“We welcome her, definitely,” Mr. Ortiz said when asked.
Executive director Ronald S. Recidoro of the Chamber of Mines of the Philippines said of Ms. Arroyo: “She has better appreciation for business for investments, but we would like to see what the legislative agenda will be.
He added: “We had concerns with Speaker Alvarez. He was pushing for a mining franchise bill, and we were really concerned about that. It’s an unnecessary imposition on a highly regulated industry and we were really against that. We hope that under Speaker Arroyo, that bill will be reconsidered.”
“When she was President, she took on a more positive view of the mining industry. We had a lot of promotional roadshows under her term. So, government actively promoted the mining industry, not just within the country but internationally,” Mr. Recidoro also said.
Also sought for comment, chairman Chris Nelson of the British Chamber of Commerce of the Philippines said, “We obviously worked with her before. We wish her all the best, and we look forward to the discussions on the tax reform in the Congress.”
“We welcome that we will work together. We look forward to working with the House and the Senate on the economic plans and the TRAIN,” he added.
President George T. Barcelon of the Philippine Chamber of Commerce and Industry said: “I would think the emphasis would be more on the economic issues. She’s an economist. We have known GMA as an economist, and she knows at this point in time how we should do it. Sa tingin ko mas focused ngayon (I think there would be be more focus) on some of these issues.”
He added: “Despite the issues, I think Congress will do its role to ensure that the budget will be spent properly and yung mga (those) project(s) (in the) pipeline will be done on time and cost-effectively.”
Mr. Barcelon also said, “I think we will take our eyes off federalism kasi parang na-sidetrack yung mga main issues. (because the main issues seem to have been sidetracked). So I think with the new speaker, I think she is going to focus on these pressing issues kasama na ang (including) peace and order and benefits sa tao (to the people).”
He said further that “(s)he (Ms. Arroyo) would be a good team with the President. I would think there would be more teamwork.”
For its part, the Communist Party of the Philippines said in a statement Tuesday: “With the rise of Arroyo in Congress, the ruling Duterte regime becomes even more isolated from the Filipino people. Aware of the grave crimes of corruption, plunder, extrajudicial killings, political repression and rampant military and police abuses committed by the Marcos dictatorship, Arroyo and Duterte regimes, the broad masses of the Filipino people are now even more determined to carry out mass struggles and revolutionary resistance.”

Nationwide Round-Up

Retiring Morales rallies media to

THIS file photo taken on August 23, 2016 shows Ombudsman Conchita Carpio-Morales during an interview at the Office of the Ombudsman in Manila. — AFP

OMBUDSMAN CONCHITA Carpio-Morales, in her farewell press conference Tuesday, advised her office and the media to collaborate in keeping watch on public accountability of the government.
“The Ombudsman and media as entities both discharging watchful functions, should continue to work hand-in-hand in upholding public interest and keeping government resources, systems and personnel less vulnerable to corruption,” Ms. Morales told reporters on the eve of her last day.
Ms. Morales officially steps down as the Ombudsman on July 26.
The Judicial and Bar Council (JBC) last week named Supreme Court Associate Justice Samuel R. Martires, Ombudsman Special Prosecutor Edilberto G. Sandoval, and private lawyer Felito S. Ramirez as among the nominees for her replacement.
Ms. Morales declined to give her successor a word of advice, saying that the next Ombudsman should be able to determine which cases should be given priority.
Further, Ms. Morales also underscored that it is necessary that the Office of the Ombudsman be granted a retirement package “to prevent exodus.”
“If I were the president, I would right away approve the retirement bill, which has already been forwarded to the Malacañang,” she said. — Charmaine A. Tadalan

Bill on Ro-Ro ports with Wi-Fi, clean toilets get Senate OK

THE SENATE on Tuesday approved on third and final reading Senate Bill No. 1749, which seeks to provide free Internet access and improve sanitation facilities in land transportation and roll-on/roll-off (RoRo) terminals nationwide. The proposed law also prohibits the collection of fees from passengers for the use of toilets. It was approved with 18 affirmative votes, no negative vote, and zero abstention. “Seventy-nine percent of domestic travelers in 2016 spent around P476 per trip for land transportation. Let us repay them with transport terminals that have clean toilets free of charge, a decent breastfeeding station and free Wi-Fi or Internet,” said Senator Grace S. Poe-Llamanzares, primary author and sponsor of the bill, in a statement. — Camille A. Aguinaldo

Duterte attack on rights advocates aimed at diverting attention on ‘abusive’ drug war

HUMAN RIGHTS Watch (HRW) said President Rodrigo R. Duterte’s comments against rights advocates in his State of the Nation Address (SONA) on Monday is intended to divert attention away from his “abusive campaign.”
“Duterte’s attack on human rights advocates for being silent on drug dealers is merely an attempt to deflect their criticism of his abusive campaign,” Carlos H. Conde, researcher for the Asia Division of Human Rights Watch (HRW), said in a statement on Tuesday.
The President criticized human rights advocates for not focusing on “drug-lordism, drug dealing and drug pushing.” Mr. Duterte also promised in his SONA that his campaign against drugs will be more “relentless and chilling.”
“(Mr.) Duterte’s promise to relentlessly pursue the war on drugs can only mean more suffering for poor urban Filipinos who account for most of the campaign’s victims. It can only mean the perpetuation of impunity and zero accountability,” HRW said.
The group also urged the International Criminal Court and United Nations Human Rights Council to take this open challenge and ensure that the president and his chief subordinates in the ‘drug war’ are held to account.”
HRW cites that from June 30 2016 to June 30, 2018, some 4,500 were killed due to «awful anti-drug operations, alleging that the suspects fought back during raids by the Philippine National Police (PNP).” It added, “Higher figures were shown to be killed by unidentified assailants throughout the country.”
HRW said their research, along with other human rights organizations, “have shown that police officers and their agents have routinely executed unarmed suspects during these anti-drug operations and, in many instances, planted evidence such as drugs and weapons on the bodies of victims to justify their killing.” — Gillian M. Cortez

It takes a mountain village

WHILE 17 sections of major roads in four regions remained closed to traffic following torrential rains since last week, smaller thoroughfares such as this in the remote Bakung area of the mountain town of Hungduan, Ifugao were also affected. Members of the community and officers of the Ifugao police Provincial Public Safety Company work together to clear out the soil collapse to allow access for vehicles.

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