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Driverless ride-hailing cars to debut at CES 2018

RIDE-HAILING start-up Lyft, Inc. and self-driving software company Aptiv Plc will show off a fully automated ride-hailing service at the Consumer Electronics Show (CES) in Las Vegas later this month.

The “point-to-point” ride-hailing system will incorporate Lyft’s app with Aptiv’s automated driving platform, offering rides to attendees of the annual show, the companies said in a statement. Operating in complex areas like the Las Vegas Strip will “accelerate the availability of automated driving platforms for commercial applications,” the companies said.

Lyft and its larger US rival, Uber Technologies, Inc., see autonomous vehicles as pivotal to their longer-term business prospects. Lyft last year announced plans to enable self-driving developers and car makers to plug into its network of nearly 1 million rides per day as it looks to bolster the nascent technology. Meanwhile, Aptiv — formed in December when supplier Delphi Automotive Plc split into two companies — is seeking to capitalize on the changing dynamics of the car sector, where parts makers with expertise in self-driving technology and electrification have become hot commodities.

The former Delphi bought self-driving start-up NuTonomy, Inc. for $450 million in October, speeding up its plans to supply car makers with autonomous vehicle systems.

Apart from forging partnerships, Lyft is opening a self-driving vehicle development facility in Palo Alto, California, called “Level 5,” a nod to the designation of fully autonomous vehicles that don’t require human supervision. The self-driving Vegas rides available during CES will be staffed by a safety driver in the front seat, the companies said. — Bloomberg

Cotton was 2017’s star crop; funds bullish in 2018

THE longest winning streak in two decades propelled cotton to 2017’s biggest increase among crop commodities, and hedge funds are ready for more gains in 2018.

Of the nine components tracked by the Bloomberg Agriculture Subindex, only cotton and wheat contracts posted gains last year. The fiber lead the way with an 11% advance as demand grew for US exports. Prices capped 2017 with 10 straight weekly gains, the best streak since 1998.

Cotton was also one of the few crops that hedge funds got more positive on during the course of the year. Money managers held a net-long position, or the difference between bets on a price increase and wagers on a decline, of 102,402 futures and options as of Dec. 26, according to US Commodity Futures Trading Commission (CFTC) data released Friday. That’s up from 76,052 at the end of 2016.

Cotton’s stellar performance came as crop woes in Pakistan and India, two of the world’s biggest growers, raised prospects for American shipments. In the 2017-2018 season, commitments for US cotton exports are running 29% higher than a year earlier, government data show.

The investors also added to their bullish outlook in soybean meal in 2017, the CFTC show. By contrast, the funds lowered their net-long holdings in soybean oil, while turning bearish on coffee, sugar and soybeans during the year.

Cotton’s gains are especially notable in a year that was dismal for most other crops amid large global gluts. Combined wagers on benchmark corn, wheat and soybean contracts reached a net-short position of 421,450 contracts as of Dec. 26. That’s the most-bearish ever in data that starts in 2006.

While both varieties of winter wheat posted gains in 2017, they were pretty small, coming in at less than 5%. The other members of the Bloomberg Agriculture Subindex — corn, soybeans, soybean meal, soybean oil, sugar and coffee — finished the year with losses. The gauge reached a record low in December, data going back to 1991 show. — Bloomberg

World Rapid Championship

World Rapid Chess Championship
Riyadh, Kingdom of Saudi Arabia
Dec. 25-30, 2017

Final Top Standings

1-3. Viswanathan Anand IND 2758, Vladimir Fedoseev RUS 2771, Ian Nepomniachtchi RUS 2780, 10.5/15

4-9. Bu Xiangzhi CHN 2654, Magnus Carlsen NOR 2908, Alexander Grischuk RUS 2813, Boris Savchenko RUS 2685, Rauf Mamedov AZE 2695, Gadir Guseinov AZE 2714, 10.0/15

10-18. Peter Svidler RUS 2743, Wang Hao CHN 2770, Yu Yangyi CHN 2752, Vladimir Onischuk UKR 2748, Vladislav Artemiev RUS 2687, Ding Liren CHN 2734, Penteala Harikrishna IND 2687, Sergey Grigoriants RUS 2572, Zhao Jun CHN 2600, 9.5/15

Total of 134 participants

Time Control: 15 minutes play-to-finish with 10 seconds added after every move starting move 1.

This year’s world rapid and blitz championships were hosted in Riyadh, the capital city of the Kingdom of Saudi Arabia. The tournaments were renamed the ‘King Salman World Rapid & Blitz Championship’, and had a record $2 million prize fund with $250,000 going to the winner.

There were no preliminary qualifying events – the rules simply state that you may join so long as your rating is 2600 and above.

There were some misgivings on the choice of Saudi Arabia for the championships. On the safety and security front Saudi Arabia has several disputes with its neighbor Yemen which has the potential to escalate to a full-blown war. I am sure our BW readers had seen in the papers that Yemen had launched 2 missiles against Saudi. Although they were both intercepted before hitting their targets you can imagine how nerve-wracking this can be!

On the political side there was a howl of protest from the Israeli Chess federation and the Association of Chess Professionals (the president of ACP is GM Emil Sutovsky, an Israeli Jew) that Israeli players were not given visas to enter Saudi Arabia. Naturally they pointed to the FIDE motto Gens Una Sumus (“we are one people”) and that its Statutes provide that “FIDE events may be hosted only by Federations where free access is generally assured to representatives of all Federations.”

There were a lot of discussion about this and I assume this will continue even after the event. My personal opinion is that the organizers from FIDE and Saudi did the best they could — it was not as if there was a queue of potential hosts and sponsors willing to take over the event.

You will remember that a few months ago Saudi Arabia along with United Arab Emirates, Bahrain and Egypt cut diplomatic ties with Qatar due to its “harboring a multitude of terrorist and sectarian groups that aim to create instability in the region.” Saudi even went so far as to close its border and halted air and sea traffic with Qatar. For the World Rapid Chess event though FIDE managed to negotiate with the Royal Family to extend visas to the Qatari players. Another issue was the government relations between Saudi Arabia and Iran, which have lately been icy. Once again the organizers managed to clear the way for the Iranian players to get visas.

FIDE was also confident that they can get a special dispensation for the Israeli players. Unfortunately though the US President Donald Trump chose this time to escalate tensions between the Arab world and Jews by declaring that Jerusalem is the capital of Israel and announcing that the US embassy would be moving there. This proved to be the straw which broke the camel’s back and the Israeli players had to stay home.

Enough talk about politics! Let’s go to the chess.

The Jordanian player IM Sami Khader (born 1972) is unknown to most of us, but he has some serious skills, for example during the 2016 Baku Olympiad he was the silver medalist on Board 5 with eight wins out of eight games for a performance rating of 2932. Here in Riyadh he came through with a brilliant victory against one of the toughest to beat players, nicknamed “Minister of Defense.”

Khader, Sami (2392) — Karjakin, Sergey (2760) [B94]
WCh Rapid 2017 Riyadh (2.43), 26.12.2017

1.e4 c5 2.Nf3 d6 3.d4 cxd4 4.Nxd4 Nf6 5.Nc3 a6 6.Bg5 Nbd7 7.Qe2 h6 8.Bh4 g6 9.f4 e5 10.fxe5 dxe5 11.Nf3

In Negi’s best-selling book on “1.e4 against the Sicilian” he recommends here 11.0–0–0!. Obviously Black cannot take the knight because of 11…exd4 12.e5 dxc3 13.exf6+. Negi then goes into a very detailed and involved analysis of what happens after 11.0–0–0 Qc7 ending around 10 moves later with the verdict that White is better. Khader does not go full throttle right away and tries to keep control of the complications.

11…Qc7 12.0–0–0 b5 13.Nd5 Nxd5 14.exd5 Bd6 15.Qe3 Bb7 16.Bd3 f5?

Best was either …Nd7–b6xd5, or even 16…0–0! if 17.Qxh6 then 17…e4! (threatening …Bf4+ winning the queen) 18.Ng5 Bf4+ 19.Kb1 Bxg5 20.Bxg5 exd3 21.Rxd3 Qe5 Black is doing very well.

17.Nd4! Qb6?!

Obviously Karjakin was counting on this move.

18.Bxf5! gxf5 19.Qg3 Nf8

[19…exd4 20.Qg6+ Kf8 21.Qxf5+ Kg7 22.Qxd7+ Black’s isolated king will fall]

20.Nxf5 Rh7 21.Rhe1 Kd7 22.Bf6?

An inaccuracy as now Black has 22…Bb4 considerably complicating matters. Once Karjakin lets this possibility slip there is no more salvation.

22…e4? 23.Nxd6 Qxd6 24.Qg4+ Kc7 25.Bh4 Qg6 26.Qf4+ Kd7 27.Rxe4 Rc8 28.c3 h5 29.Re6 Nxe6 30.dxe6+ Ke8 31.Qd6 Qh6+ 32.Kb1 Be4+ 33.Ka1 Bd3 34.Qxd3 Kf8 35.e7+ Kg7 36.Qd4+ Kf7 37.Rf1+ Ke6 38.Rf6+ Qxf6 1–0

This was not Karjakin’s tournament. He later on went down again to a 15-year-old boy (still only an FM but has already fulfilled the requirements for the GM title), Andrey Esipenko, the reigning World Under-16 Champion. The video of the event shows that the two players on the next board, Ponkratov and Grischuk, couldn’t stop looking over their shoulders to see Karjakin being taken down.

Karjakin, Sergey (2760) — Esipenko, Andrey (2564) [B11]
WCh Rapid 2017 Riyadh (8.9), 27.12.2017

1.e4 c6 2.Nf3 d5 3.Nc3 Bg4 4.h3 Bxf3 5.Qxf3 Nf6 6.d3 e6 7.Bd2 Qb6

This is Esipenko’s pet line in the Caro-Kann Two Knights Defense.

8.0–0–0 d4 9.Ne2 c5 10.e5 Nd5 11.Nf4 Nb4 12.Kb1 Nd7 13.Qe4 Nc6 14.Nh5 0–0–0

Black shouldn’t take the proferred pawn. After 14…Ndxe5 15.f4 Nd7 16.f5 e5 17.Be2 followed by Bf3 and g2–g4 White will have a full-blown initiative. Black with his pieces not yet properly coordinated will have to shed one or two pawns to hold the balance.

15.f4 c4!

One moment White is trying to break through in the center and the next it is Black who has a strong offensive against the opposing King.

16.dxc4 Ba3 17.Bc1

[17.b3 Nc5 18.Qf3 d3 19.Bxd3 Rxd3 20.cxd3 Nxb3 Black mates]

17…Nc5 18.Qf3 d3! 19.cxd3

[19.Bxd3 Bxb2! 20.Bxb2 Na4 21.Kc1 Qxb2+ 22.Kd2 Rxd3+ 23.Qxd3 Rd8 Black is clearly winning]

19…Na4 20.Rd2 Nd4 21.Qf2 Nc3+ 22.Ka1 <D>

Position after 22.Ka1

Now for the nice finish.

22…Qb3! 23.bxc3

[23.axb3 Nxb3#]

23…Qxc3+ 24.Bb2 Bxb2+ 25.Rxb2 Qc1+ 26.Rb1 Nc2+ 27.Qxc2 Qxc2 28.g3 b5 29.cxb5 Rd4 0–1

The Tbilisi KO World Cup held last September had 7 rounds of mini-matches involving 128 of the top players of the world. Who would have thought that the reigning world champion Magnus Carlsen would only last up to the 3rd round? It was Bu Xiangzhi who brought him down with a sudden kingside attack. Here in Riyadh Bu Xiangzhi prevented any thoughts about “revenge being a dish best served cold” by upsetting Carlsen again with yet another kingside assault.

Carlsen, Magnus (2837) — Bu, Xiangzhi (2730) [A28]
WCh Rapid 2017 Riyadh (1.1), 26.12.2017

1.c4 Nf6 2.Nc3 e5 3.e3 Nc6 4.a3 d5 5.cxd5 Nxd5 6.Qc2 Be7 7.Nf3 0–0 8.b4 Nxc3 9.dxc3 Qd6 10.Bd3 f5 11.e4 f4 12.h3 a5 13.Bb2 Bf6 14.Rd1 Qe7 15.0–0 Be6 16.Qe2 Qf7 17.Rd2 g5 18.b5 Ne7 19.c4 Ng6

The follow-up will be 20…g4 21.hxg4 Bxg4 and the pin will be hard to break.

20.Nh2 Rad8 21.Rfd1 Qe7 22.Qh5 Rd7 23.Ng4 Rfd8 24.Nh6+

[24.c5 Bg7 25.c6 bxc6 26.bxc6 Rd6 27.a4 The coming Ba3 is awkward to meet]

24…Kh8 25.Nf5 Qc5 26.Qe2 Nh4 27.Nxh4 gxh4 28.Qh5 Rg8 29.Bf1 Rdg7 30.Kh1 Qe7 31.Qf3 Rg5 32.a4 Bf7 33.Rd7 Qe6 34.Qe2?

GM Yermolinsky pointed out here that the correct move for White is 34.Qa3! so that Black’s …Qb6 anytime can be met by c4–c5.

34…Bh5 35.f3 Rg3

Threatening 36…Bxf3.37.gxf3 Rxh3+ 38.Bxh3 Qxh3+ 39.Qh2 Qf3+ 40.Qg2 Qxg2 checkmate.

36.Kh2 Qb6! 37.c5 Qxc5 38.Kh1 0–1

Here Carlsen lost on time, but it does not matter since it is mate in 2: 38…Rxh3+ 39.gxh3 Qg1 checkmate.

This was a really exciting event. Rapid chess, if you ask me, is the way to go for the coming years.

 

Bobby Ang is a founding member of the National Chess Federation of the Philippines (NCFP) and its first Executive Director. A Certified Public Accountant (CPA), he taught accounting in the University of Santo Tomas (UST) for 25 years and is currently Chief Audit Executive of the Equicom Group of Companies.

bobby@cpamd.net

Solar’s bright future is further away than it seems

By Tyler Cowen

THERE is now a doctrine of what I call “solar triumphalism”: the price of panels has been falling exponentially, the technology makes good practical sense, and only a few further nudges are needed for solar to become a major energy source. Unfortunately, this view seems to be wrong. Solar energy could be a boon to mankind and the environment, but it’s going to need a lot more support and entrepreneurial and policy dynamism.

Varun Sivaram, in his forthcoming Taming the Sun: Innovations to Harness Solar Energy and Power the Planet lays out this case in what may be the first important policy book of 2018. To be clear, Sivaram, who holds a doctorate in physics, is a solar expert and an energy adviser — he’s no enemy of alternative energy sources. He thinks government should increase its support for energy research and development, aiming at diverse pathways, applied at various stages of technology development, and targeting game-changing breakthroughs. In other words, we need to recognize the limitations of today’s solar power if we are going to make it really work.

The first disquieting sign is that solar companies are spending only about 1% of their revenue on research and development, well below average for a potentially major industry. You might think that’s because things are going so great, but some major solar users may have already maxed out their technology. According to Sivaram’s estimates, four of the five most significant country users — Italy, Greece, Germany, and Spain — have already seen solar energy flatten out in the range of 5% to 10% of total energy use. The fifth country, Japan, is only at 5%.

Germany and the state of California have experienced operational problems as solar has grown as an energy source. Because the sun isn’t continuously available, solar power at large scale doesn’t integrate well with the electric grid, which favor steady sources such as fossil fuels or nuclear. Solar power creates an expense for the whole system, even if the panels themselves are cheaper.

Silicon technologies dominate the panel market today, but Sivaram sees greater dynamic potential in perovskite, organic and quantum dot solar cells, and possibly orbital solar power satellites. Breakthroughs in those areas might lower costs and increase solar potency, making the calculus more favorable to green energy.

A common view is that solar power will come into its own once batteries and other storage technologies make steady improvements. Yet Sivaram notes that lithium-ion batteries in particular are not well-designed for storage across days, weeks and months. Also note that about 95% of global energy storage capacity is from hydroelectric power, a discouraging sign for the notion that solar energy storage is on a satisfactory track.

solar panel

Promoting solar energy also isn’t in the interest of regulated utilities. They fear a scenario where many users deploy solar power to detach from the energy grid, either wholly or in part. Other customers’ bills would have to rise to cover the costs of the grid, and that in turn would encourage even more secession into solar and alternate energy sources. Because that scenario is a financial loser for the utilities, regulatory institutions discourage utilities from integrating solar power into the grid, which limits competition.

Solar energy has great potential for emerging economies, but some very basic preconditions are not in place.

India, for instance, would need to end its kerosene and electricity subsidies. Freer trade in solar technologies is found in Tanzania and Rwanda but not always in West Africa.

In sum, just improving silicon panel solar technologies may not be enough. Sivaram calls for “systemic innovation,” based on “refashioning entire energy systems — including physical infrastructure, economic markets, and public policies — to enable a high penetration of solar energy.” I would add that we should reconsider the abandonment of nuclear energy, a topic that Sivaram touches upon but does not emphasize.

One lesson is that marginal improvements aren’t always enough, and economic dynamism is more important than we have been realizing. A whole series of integrated breakthroughs may be required to move significantly closer to a green energy future. I do think the US will eventually get there, but after reading Taming the Sun, I have to wonder if we are up to the challenge now.

 

BLOOMBERG

Alvarez: Sereno’s impeachment ready by March

HOUSE SPEAKER Pantaleon D. Alvarez, in an interview with ANC on Wednesday, said impeachment proceedings against Chief Justice Maria Lourdes P.A. Sereno may be finished “before the House adjourns for the Holy Week break” in March. “Oo, palagay ko naman tapos na ang (impeachment) committee nun. In fact nag-umpisa na rin kami na i-consolidate ’yung lahat ng mga ebidensya at yung mga testimonies na nakalap namin,” Mr. Alvarez said. (Yes, I think the committee would be done by then. In fact, we’ve already started consolidating all the evidence and testimonies we’ve gathered.) For his part, Oriental Mindoro Representative Reynaldo V. Umali, who chairs the House impeachment committee, said he is set to meet with the secretariat to finalize the list of resource persons who will be invited when hearing resumes on Jan. 15. — Minde Nyl R. dela Cruz

Organic Champagne making a slow fizz into glasses

REIMS, FRANCE — A bubble it is not: the organic movement is only slowly taking root in France’s Champagne region, although its proponents believe environmentally friendly techniques can help the sparkling wine express even finer subtleties.

Organic farming has experienced a boom in recent years, in France, too, where the wine industry has been keen to adopt practices that shun synthetic chemicals and fertilizers.

If 5% of all agricultural land in France was being organically farmed or in the process of conversion in 2015, the figure was 8.7% for the wine sector, according to data from the public-private agency that promotes “green” farming in France.

But there are regional disparities, and the Champagne region is trailing with just 1.9% under organic production, even if the amount of land there carrying an “Agence Bio” (or AB) certification increased by 14% between 2015 and 2017.

Organic farming is not for those looking to make a quick buck or jump on the latest bandwagon.

“If you’re just looking to put a pretty seal on your label, you’ll be disappointed very quickly,” said Pascal Doquet, president of the association of organic Champagnes.

Doquet said he spent “six years between the beginning of the conversion process and the first sale of bottles” bearing the AB seal.

The slow maturation of Champagne, an element of its quality and the cachet which allows the wines to command premium prices, is a disadvantage when going green.

Converting the land to organic farming is a three-year process. Then, there is the requirement that Champagne must mature in bottles for at least 15 months, with many makers leaving it even longer.

Another crucial element is climate, which needs to be cool with little sunshine to help the grapes mature slowly.

And dampness is also a challenge, especially as organic farming sharply limits which treatments can be used.

For many practitioners, organic is as much a philosophy as a process.

Doquet said he has had to become a “real farmer,” cultivating the vine’s “capacity for resistance,” while other wine makers were mere “technicians.”

TERROIR IN A BOTTLE
The respect for the environment that underpins the organic movement’s philosophy fits in with the French concept of terroir, where soil, topography and climate all combine to influence the taste of the wine.

Less invasive farming techniques can therefore help produce wines that better reflect the nuances of their environment, or “make the terroir sing,” as Eric Rodez, head of a family winery at Ambonnay in the Marne Valley, puts it.

It was a much more “demanding” way of wine-making, “living life by the rhythm of nature, not the clock of the world,” he argues.

But his family winery, which consists of six hectares and produces around 50,000 bottles per year, now produced “liberated wines” with more “expressive” scents and flavors, Rodez says.

The idea has caught the attention of at least one of the leading Champagne houses — Louis Roederer Champagne.

Unusual among large houses in that it grows its own grapes, 10 of Louis Roederer’s 240 hectares are certified as organic. And it plans to gradually convert all of its land in future.

“For me, organic is an obvious choice, because it is the terroir that makes wines unique,” said the house’s cellar master, Jean-Baptiste Lecaillon. “That uniqueness can’t come from a massive blanket of chemicals that neutralize flavors.”

‘ECONOMIC SHORT-TERMISM’
Even if the Champagne region doesn’t yet embrace organic farming widely, it has been reducing its use of chemicals.

Over the past 15 years, the region has cut the use of nitrogen fertilizers and pesticides by half, according to the Comite Champagne, the trade association for the 300 Champagne houses and 15,000 wine makers.

And in 2014, it launched its own certification of “sustainable viticulture,” specially tailored to the Champagne region.

So far, more than 4,000 hectares out of the region’s 34,000 hectares have received the certification.

Nevertheless, few of the big Champagne houses appear to be in any rush to go organic.

Lecaillon said those who did must be ready to accept that “in certain years, they could lose 10, 20 or even 30% of the harvest,” without the help of chemical fertilizers and treatments.

But it’s not just a question of “economic short-termism” that is preventing Champagne houses from going green, Lecaillon said.

Since most large Champagne houses buy much of their grapes from growers, those growers would be required to go organic, too.

Consumers, too, have little leverage to pressure producers into going green, because organic Champagnes are still a niche market and are rarely seen on supermarket shelves. — AFP

Across eastern half of the US: First comes the bone-rattling cold, then comes the snow bomb

BOSTON — As if the deep freeze that’s sent temperatures plunging to all-time lows across the eastern half of the US weren’t enough, the region may get hit with a snow bomb.

Now that Boston has tied a 100-year-old record with seven days of highs below 20˚ Fahrenheit, New York’s airports have registered new lows and Chicago has enjoyed its coldest New Year’s Day ever, a storm is set to race up the US East Coast on Thursday and dump snow along the way. Boston may see as much as 11 inches (28 centimeters), Manhattan could get 3, and Brooklyn and Queens are set for 4.

This storm may end up being worse than your average nor’easter. It could turn into a bomb, short for bombogenesis, a phenomenon that occurs when a system’s central pressure drops steeply — 24 millibars or more — in 24 hours. If current computer models hold, that’ll start to happen somewhere off Cape Hatteras, North Carolina, and continue as the storm moves north. Hurricane-force wind warnings have been posted off the coast where ships could encounter winds of 80 miles (130 kilometers) an hour and waves as high as 26 feet on Thursday.

“The real apex, the peak of the storm, will be Cape Cod to Nova Scotia,” said Gregg Gallina, a forecaster at the US Weather Prediction Center in College Park, Maryland.

On its current track, the storm will scrape the East Coast and dump snow from South Carolina to Maine and into Canada, with Boston and parts of Maine bearing the brunt. Georgia Governor Nathan Deal has already declared a state of emergency for 28 counties. The weather stands to wreak havoc on markets for longer, as electricity prices have already surged to the highest level in years and natural gas demand hit a record high.

“On Long Island, out by the Hamptons and Montauk, it could be four to six inches, then we start talking about the really big numbers,” Mr. Gallina said. “The main action is the eastern third of Massachusetts.”

There’s a silver lining: The storm will offer some respite from the bone-rattling cold that triggered wind chill advisories and freeze warnings across the central US and winter storm watches from Massachusetts to Florida on Tuesday.

But the relief will only be temporary as the Arctic chill is set to make a comeback by the end of the week. Temperatures will rise out of the teens and single digits from Philadelphia to Boston before slipping back again by Friday and Saturday.

“This is only the appetizer — the main meal comes over the weekend,” said Judah Cohen, director of seasonal forecasting for Atmospheric and Environmental Research, a Verisk Analytics, Inc. business in Lexington, Massachusetts. “This is about as intense a cold as I can remember.”

The storm will probably cause blizzard conditions in New England and eastern Long Island as high winds accompany the snow, said Paul Walker, a meteorologist with AccuWeather, Inc.

And that’s not where the bad news stops: Another round of bitterly cold air is forecast to blast across the US by the middle of next week. The chill could linger through Jan. 16. — Bloomberg

China’s most awarded wine is now here

The 17th edition of the Grand Wine Experience, subtitled “Degustation,” took place at the Marriott Hotel Grand Ballroom on Nov. 24. Once more the country’s biggest wine aficionados flooded Resorts World Manila Newport City to be part of the country’s largest wine event of its kind. This year — as in the last two to three years — I noticed the increased presence of spirits, notably whiskies and gins. I guess the successful staging of Whisky Live also helped this cause.

The staple wine brands we see annually remained as visible as ever, namely: Montes, Yalumba, Wente, Ramon Bilbao, Concha y Toro, Champagne Henriot, Trapiche, Zonnin, Pirrammima, Jim Barry, Saint Clair, Mont Gras, etc. But what really struck me as an ever-evolving oenophile was the entry of China’s most critically acclaimed winery, Grace Vineyard from Shanxi Province.

Admittedly I have tasted some of its homegrown wines in my travels to China over the last decade or so, but outside of the commercially huge Dynasty (a joint venture with international spirits company Remy Cointreau), Changyu (China’s oldest and largest winery), and Great Wall, other Chinese wine brands I tried were sadly not very good, and I couldn’t even bother trying to remember their names. But over the last few years, the western press has become more gung-ho over Chinese wines, notably the more premium wines from the likes of Ao Yun, owned by the luxury company Louis Vuitton Moët Hennessy or LVMH, and Chateau Rongzi.

And then there is Grace Vineyard.

Grace Vineyard has been extremely visible in VinExpo events, notably the even-numbered years held in Hong Kong, and, while I was not lucky enough to get into the tasting forums at VinExpo, I finally got my chance to taste some Grace Vineyard wines at the last Grand Wine Experience. Philippine Wine Merchant, the top wine importer-retailer in the country (owned by the Joseph brothers) has been appointed as the exclusive Philippine importer of this renowned winery from China.

GRACE VINEYARD Chairman’s Reserve 2012 — A Bordeaux blend and one of China’s most recognized premium wines.

GRACE VINEYARD’S ASCENSION
Grace Vineyard was founded by Chun-Keung Chan, an Indonesian-born Chinese in 1997, with the assistance of French viticulture and enology experts. The winery is located in Taigu, a district 40 kms. south of Taiyuan, capital city of Shanxi Province. Taigu was chosen because of its ideal terroir for viticulture — it has the continental climate, the right topography, and the Bordeaux-like draining sandy soil to make good wines. Just five years into the business in 2002, founder Chun-Keung Chan passed the baton to his American-educated and former Goldman Sachs-employee daughter Judy.

With the young, very active and dynamic Judy Chan at the helm, Grace Vineyards has ascended quite fast. The PR side in particular has been amazing. All the most respectable wine journalists and publications have given Grace Vineyard kudos for quality, dedication and innovation. I even saw a CNN video report on Grace Vineyard.

The winery also participated in many competitions and has done extremely well when it comes to medal hauls. One of its latest victories was the very prestigious Decanter Asia Wine Awards where the Grace Vineyard Tasya Reserve Marselan 2015 (a French crossed-bred varietal) won the “Best Red Single Varietal.” For sure, we will be hearing more of Grace Vineyard even here in the Philippines where we have unfortunate biases against China-made products.

CUSTOMARY TASTING NOTES
There were only three different Grace Vineyard wines that were featured at the Grand Wine Experience, and, sadly, the winning Marselan wine from the Decanter Asia Wine Awards was not included. But the three wines brought in were actually their top range. Here below are my usual tasting notes:

• Grace Vineyard Tasya’s Reserve Chardonnay 2014 — “mineral notes on the nose, capsicum, citrus, almonds, quite complex, and not your typical New World Chardonnay, dry, clean, crisp and flinty at the end; a pleasantly sophisticated white wine”

• Grace Vineyard Deep Blue 2012 — a Bordeaux blend of 68% Cabernet Sauvignon, 22% Merlot, and 10% Cabernet France; “black cherries, rhubarb, fresh ripe fruits, cedary, bitter-sweet tannins, supple on the mouth-feel, long with lingering berries at the end; another very good wine that has a lot of character and flavors”

• Grace Vineyard Chairman’s Reserve 2012 — another Bordeaux blend, but this time with 57% Cabernet Sauvignon, 33% Merlot and 10% Cabernet Franc; “flambé berries, vanilla, creamy, a real fruit bomb, full-bodied, tannins quite fresh/green because of its youth, but on the finish it is a bit short; I was probably expecting a bolder end given its luscious fruits on the nose”

As I was telling Ronnie Joseph and some wine professional colleagues during the time I spent at the Grace Vineyard table at Grand Wine Experience, Grace Vineyard wines really taste closer to Old World than New World wines, and is, quite frankly, unlike other Chinese wines I have tasted (admittedly a very small sample size).

With an abundance of fine Chinese restaurants all over our country, it is perhaps no longer strange to actually enjoy high quality Chinese wines with Chinese cuisines.

I would love to visit their vineyards in the very near future especially due to our proximity to the Mainland, so I can compare them with my experience visiting European, Californian, Australian, South African, and other wine producing regions. China has indeed come a long way, and with good wines now being produced in the Mainland, what can’t China do?

The author has been a member of the Federation Internationale des Journalists et Ecrivains du Vin et des Spiritueux or FIJEV since 2010. For comments, inquiries, wine event coverage, and other wine-related concerns, e-mail the author at protegeinc@yahoo.com. He is also on Twitter at twitter.com/sherwinlao.

WeChat denies it stores user chat histories

HONG KONG — Tencent Holdings’ WeChat, China’s most popular messenger app, on Tuesday denied storing users’ chat histories, after a top businessman was quoted in media reports as saying he believed Tencent was monitoring everyone’s account.

“WeChat does not store any users’ chat history. That is only stored in users’ mobiles, computers and other terminals,” WeChat said in a post on the social media platform.

“WeChat will not use any content from user chats for big data analysis. Because of WeChat’s technical model that does not store or analyze user chats, the rumor that ‘we are watching your WeChat everyday’ is pure misunderstanding.”

Li Shufu, chairman of Geely Holdings, owner of the Volvo car brand, was quoted in Chinese media on Monday as saying Tencent Chairman Ma Huateng “must be watching all our WeChats every day.”

Like all Chinese social media platforms, WeChat is required to censor public posts deemed “illegal” by the Communist Party. WeChat’s privacy policy says it may need to retain and disclose users’ information “in response to a request by a government authority, law enforcement agency or similar body.”

WeChat did not immediately respond to a request for further comment.

According to a report by Amnesty International, Tencent ranked at the bottom of 11 tech firms running the world’s most popular messenger apps for how they use encryption to protect user privacy.

China’s cyber watchdog in September announced a new rule making chat group administrators and companies accountable for breaches of content rules.

In the same month it handed down maximum penalties to tech firms including Tencent, Baidu Inc and Weibo Corp for failing to properly censor online content, and asked them to increase content auditing measures. — Reuters

DoF estimates Dec. inflation moderating to 3.2%

THE Department of Finance (DoF) expects headline inflation to have eased further in December on steady food and power prices.

“Inflation in December of last year is expected to have moderated to 3.2%, down from the previous month’s 3.3%, on the back of more stable food prices and lower power costs,” the DoF said in an economic bulletin yesterday.

If the estimate pans out, December’s inflation rate will be significantly higher than the year-earlier 2.6%.

The DoF’s estimate was lower than the 3.3% median from a poll of 12 economists conducted by BusinessWorld.

The Bangko Sentral ng Pilipinas (BSP) meanwhile gave a 2.9-3.6% range in estimating December inflation last week.

The Philippine Statistics Authority will report official inflation data on Friday.

Food and non-alcoholic beverage price growth is thought to have steadied at 3.2% in December, compared with 3.6% a year earlier, according to DoF’s bulletin.

Price growth in housing, utilities, and fuels meanwhile may have slowed to 3.7% from 4.2% in November. The year-earlier rise was 1.3%.

The rise in transport costs is also thought to have moderated to 2.8% in December from 4.4% a month earlier. The year-earlier price growth level was 1.9%.

The DoF said that the moderating price growth should support continued robust macroeconomic conditions, especially after the enactment of the Tax Reform for Acceleration and Inclusion (TRAIN) law.

“Low inflation is an indication that the country’s macroeconomic fundamentals remain strong. Solid fundamentals backed by TRAIN 1 implementation, rice sector reform and the Build, Build, Build policy will push the country’s growth to seven to 8% this year and sustain manageable inflation,” according to the bulletin.

The tax reform program, which takes effect this year, lowered personal income, estate, and donor’s taxes, removed some value-added tax exemptions, while increasing the excise tax on coal, minerals, fuel, some automobiles, and some passive-income items. It also introduced new levies on cosmetic procedures and sugar-sweetened beverages.

A portion from the incremental revenue from TRAIN will help fund the government’s infrastructure program. — Elijah Joseph C. Tubayan

Pakistan hits back at ‘incomprehensible’ Trump tweet

ISLAMABAD — Pakistan angrily dismissed threats by US President Donald J. Trump to cut off aid as “completely incomprehensible” Tuesday, in the latest diplomatic row to rock the shaky alliance between Washington and Islamabad over militancy.

The “recent statements… by the American leadership were completely incomprehensible as they contradicted facts manifestly,” read a statement issued by the prime minister’s office after a meeting of the National Security Council.

Mr. Trump’s comments “struck with great insensitivity” and “negated the decades of sacrifices made by the Pakistani nation,” it added.

The statement was the first formal comment from Pakistan since Mr. Trump lashed out on Monday, making Islamabad his inaugural Twitter target of 2018.

“The United States has foolishly given Pakistan more than $33 billion in aid over the last 15 years, and they have given us nothing but lies and deceit, thinking of our leaders as fools,” Mr. Trump said.

“They give safe haven to the terrorists we hunt in Afghanistan, with little help. No more!”

Pakistan, which says it has lost more than 62,000 lives and $123 billion since 2003 in its war on extremism, disputed the $33 billion figure in the statement.

“(T)he huge sacrifices made by Pakistan… could not be trivialized so heartlessly by pushing all of it behind a monetary value — and that too an imagined one,” it said.

Foreign minister Khawaja Asif also mocked the figure on Twitter, suggesting Mr. Trump hire a US audit firm to check it “on our expense.”

Mr. Trump first hinted at cutting aid to Pakistan in an August speech charting his Afghan policy, and administration officials including Vice-President Mike Pence have also intimated cuts in recent months.

But the Pakistani statement said recent interaction with US officials had been “useful,” citing visits in recent months by Pentagon chief James Mattis and Secretary of State Rex W. Tillerson as “robust and forward-looking.”

Observers said that without further information the tweet could just be more hot air between the allies, whose often fractious relationship has taken a nosedive under Mr. Trump.

“Trump is in the habit of issuing hardline statements which only spoil the atmosphere and violate diplomatic niceties,” analyst Hasan Askari told AFP, adding that Pakistan should seek more information.

AMBASSADOR SUMMONED
The statement came one day after US Ambassador David Hale was called to the foreign ministry in Islamabad in a rare public rebuke. Neither US nor Pakistani officials have commented on what was said at the meeting.

After the September 11 attacks on the United States, Washington forged a strategic alliance with Islamabad to help in its fight against militancy.

But Washington and Kabul have long accused Islamabad of supporting militant groups including the Taliban, believed to have links to Pakistan’s shadowy military establishment which aims to use them in Afghanistan as a regional bulwark against arch-nemesis India.

Islamabad has repeatedly denied the accusations, lambasting the US for ignoring the thousands who have been killed on Pakistani soil and the billions spent fighting extremists.

On Tuesday China, which has stepped up a multi-billion dollar economic investment in Pakistan, spoke out in its defense, with a foreign ministry spokesman praising its “outstanding contribution to the global cause of counterterrorism.”

Mr. Trump’s August speech, in which he accused Islamabad of harboring “agents of chaos,” triggered a series of high-level diplomatic meetings in the US and Pakistan.

The Trump administration also told Congress it was weighing whether to withhold $255 million in earmarked aid to Islamabad over its failure to crack down more effectively on terror groups.

But though Islamabad said Tuesday that recent meetings had created a “better understanding,” it has given few signs of concessions since August.

Of foremost concern in the US is Islamabad’s attitude toward the powerful Haqqani network, whose leader Sirajuddin Haqqani is the deputy of the Afghan Taliban.

The group, accused of some of the most lethal attacks on US forces in Afghanistan, has been dubbed a “veritable arm” of Pakistani intelligence.

For many years it found safe haven in Pakistan’s tribal areas, however the military launched an operation there in 2014, and now insists it has eradicated all safe havens in the country.

For Pakistan, analyst Imtiaz Gul noted, the assumption is that arch-rival and fellow nuclear power India is fueling Mr. Trump’s hostility towards Islamabad.

India has long vied with Pakistan for influence in Afghanistan, and Mr. Trump and other administration officials have called on new Delhi to become more involved there — an idea that is anathema to Pakistan, which fears encirclement.

“Now Pakistan’s first attempt will be to neutralize India’s narrative of Pakistan,” Mr. Gul said. — AFP

Airlines unlikely to lower fares this year — report

WITH OIL PRICES expected to rise this year, airlines are unlikely to lower fares, which in turn may dent passenger demand, according to an aviation market intelligence provider said.

“Rising oil costs will stall fare decreases, dulling demand in what has become a highly price sensitive market,” CAPA said on its Web site for its outlook for 2018.

CAPA said that 2017 has “arguably been the sweetest spot for combined airline profitability and traffic growth ever experienced,” but this is unlikely to be maintained for 2018.

CAPA said the growth of the aviation industry can be attributed to both the “typical economic forces” and short-term forces.

While typical economic forces like gross domestic product (GDP) growth, business confidence, and trade flows all expectedly impact the aviation industry, these are not enough to determine the growth of the industry.

For the relationship between GDP growth and air traffic for example, a fair expectation would be passenger growth around two times the GDP growth, but growth has been at five times, not just 1.5 or two times GDP growth. Short-term influences particularly affect the aviation industry.

“Most recently, one of the biggest short-term influences has been the large fall in the price of oil. When oil prices were around $80 per barrel and above, airlines had adjusted their models to allow for that input cost. Capacity decisions, including aircraft retirement (or not); route planning; pricing, and staff hiring, were all influenced by the input cost of fuel, when oil prices dropped as low as the mid-$20s per barrel,” CAPA said. 

“Given that aviation fuel costs constitute anything from 20% to 30% — and, for LCCs [low cost carriers], even 40% or more — of total cost, a rapid reduction in the barrel price from $100 to $30 made a massive difference to the shape of the industry; particularly in an industry which typically enjoys such thin profit margins,” the report added.

Airlines which took advantage of very low fuel prices to hedge their future needs for 2018 will feel the impact of higher fuel costs gradually, but the effect will be almost immediate for those who have not hedged and are more fully exposed the price increases. If added by higher interest rates and increasingly suppressed demand, the effect will likely be worsened.

“The bottom line is that we have almost certainly passed the unusual sweet spot of high profitability and high traffic growth experienced in 2017,” CAPA said.

This will mean a greater challenge for the industry to refocus, given the price of fuel and a competitive market.

“As fuel prices rise, the industry will once again be in the mode of refocusing to adjust to a new cost and competitive environment. The more they rise, the greater the challenge, as price sensitive discretionary travelers are deterred,” CAPA said. — P.P.C. Marcelo

BusinessWorld‘s Top 1000 Corporations in the Philippines can be purchased at Fully Booked and National Bookstore outlets. You may also purchase it by calling BusinessWorld at Tel. (632) 535-902 extension 102.

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