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BoC to expand data-sharing efforts with other agencies

THE BUREAU of Customs (BoC) said it is hoping to implement a data-sharing system with other law enforcement agencies to aid anti-smuggling efforts.
In a statement from the Department of Finance (DoF), Customs Commissioner Isidro S. Lapeña recommended the establishment of a data sharing systems between the BoC and the Bureau of Internal Revenue (BIR), the Philippine Coast Guard (PCG) and the Armed Forces of the Philippines (AFP).
“[The task force is] a joint undertaking. The signing of a Memorandum of Agreement is with the BIR also, and the Philippine Coast Guard, AFP and other law enforcement agencies that we will be needing assistance from,” Mr. Lapeña said.
He added that it hopes to harness the capabilities of the patrol vessels of the PCG to monitor smuggling activities.
“We will be assigning people who will be trained [by the PCG] until such time that they are capable of operating the vessels themselves,” he said.
Mr. Lapeña was referring to the patrol vessels that were acquired through loans from European banking institutions under the Philippine Port and Coast Guard Capability Development Project (PCG Vessels Project).
Finance Secretary Carlos G. Dominguez III requested last year that the vessels be transferred from the Department of Transportation to the BoC.
The BoC is in the process of signing a memorandum of agreement with the BIR on information sharing and coordination to help combat smuggling, amid the proliferation of counterfeit cigarettes.
Tax effort in the first quarter grew to 14.3% of gross domestic product from 13.4% a year earlier.
Both the BoC and the BIR are exceeding their collection targets as of mid-year, with the government attributing their performance to the enactment of the Tax Reform for Acceleration and Inclusion law. — Elijah Joseph C. Tubayan

Business groups lobby PAL for Davao-Japan flights

DAVAO CITY — Filipino and Japanese business groups have asked flag carrier Philippine Airlines (PAL) to open direct flights between Davao City and Japan to boost tourism and trade links.
“We must not wait for them (Japanese) to come, let us come up with key initiatives to attract them,” Arturo M. Milan, president of the Davao City Chamber of Commerce and Industry, Inc. (DCCCII), told BusinessWorld last week.
The letter has 18 signatories, including Davao-based Japanese Consul General Yoshiaki Miwa and representatives of the Japanese Chamber of Commerce in Mindanao.
The letter was submitted earlier this month to PAL President Jaime J. Bautista through Victor D. Suarez, area head for Mindanao Sales and Services.
Mr. Milan said interest in Davao from Japanese investors has been on the rise while several government projects undertaken with Japanese cooperation are in the works.
“Japanese government and some private organizations have signed joint venture agreements with the local government of Davao on solid waste management, a biodiesel plant and the Mindanao Railway System,” the letter pointed out.
The city government, through the Davao City Investment Promotion Center (DCIPC), also expressed support for the request and noted that Filipino tourists to Japan have also been increasing.
DCIPC “welcomes this initiative as recent data shows the viability of the route as evidenced by the number of Filipinos traveling to and living in Japan, as well as Japanese residents who want to travel to Davao City,” said the agency’s head, Lemuel G. Ortonio.
“The proposed connectivity between Davao City and Japan will open opportunities for boosting economic growth, facilitating convenient movement of goods and people, and increasing the tourism activities and business exchanges in both destinations,” Mr. Ortonio added.
The letter also cited the “increasing (Japanese) tourist arrivals” and the plan of the city government, with the help of the Tourism and Infrastructure Enterprise Authority, to rehabilitate and develop the ‘Little Tokyo’ in Mintal, an old Japanese settlement pre-dating World War II where a Japanese cemetery is located.
Alexander D. Divinagracia, president of the Davao Travel Agencies Association (DTAA) and general manager of Globalwings Travel and Tours, said August is a particularly good period for attracting Japanese tourists with Davao’s Kadayawan Festival and the Japanese-Buddhist Obon Festival of honoring ancestors.
“We can revive this (Obon Festival). Most of the participants are elderly and the direct flight would be of big help,” he said.
Aside from tourists on both sides, Mr. Divinagracia said there is a significant number of overseas Filipino workers in Japan.
“I will support this move to open a direct flight. Let’s see. It’s always a joint effort of everybody to sustain this route,” he said. — Carmelito Q. Francisco and Maya M. Padillo

Investors turn attention to earnings reports

By Arra B. Francia, Reporter
THE MAIN INDEX eked out last-minute gains on Tuesday after moving within a tight range as investors await the release of corporate earnings results in the coming weeks.
The 30-company Philippine Stock Exchange index (PSEi) climbed 12.24 points or 0.16% to finish at 7,381.68, bouncing back from the previous session’s losses, while the all-shares index added 2.78 points or 0.06% to 4,465.38.
“The Philippine market tried to rebound on opening, but failed to sustain its strength and traded in negative territory until market-on-close orders pushed it to finish 12.24 pts or 0.17% higher at 7,381.68,” RCBC Securities, Inc. noted in its Stock Market Daily Recap.
Timson Securities, Inc. trader Jervin S. de Celis said in a mobile phone message that “[i]nvestors are anticipating the release of second-quarter corporate earnings from some blue-chip companies in the next few weeks, though market participants are being selective.” “Although most of the index stocks have rallied from the past two weeks, our index is still trading below its average volume turnover,” Mr. De Celis added.
For Papa Securities Corp. trader Gabriel Jose F. Perez, PSEi’s performance reflected “hesitation felt all around,” noting in an e-mail that “7,400… remains to be the initial obstacle to overcome, but with the low volume we’ve been seeing and stochastics being overbought it might be best to still exercise caution.”
The six sectoral indices were equally divided between those that advanced and losers.
Those that gained consisted of services (up 14.04 points or 0.98% to 1,443.23), industrials (44.76 points or 0.42% to 10,515.49) and property (7.04 points or 0.19% to 3,596.15), while those that lost were holding firms (down 19.5 points or 0.26% to 7,230.25), financials (0.63 point or 0.03% to 1,823.20) and mining and oil (0.01% or 1.03 points to 9,658.62).
Some 456.02 million issues worth P3.59 billion changed hands, compared to Monday’s 919.84 million worth P4.28 billion. Stocks that gained narrowly outnumbered those that lost 91 to 90, while 55 others closed flat.
Net foreign selling persisted, growing 72.23% to P481.06 million from Monday’s P279.31 million. Timson Securities’ Mr. De Celis attributed this to investors’ anticipation of retail sales report and jobless claims in the United States this week that may persuade the US Federal Reserve to remain hawkish. “This may trigger further net foreign selling in that case,” Mr. De Celis said.
Half of Tuesday’s 20 most active stocks gained, led by Metropolitan Bank & Trust Co. (up 0.29% to P70 each); Ayala Land, Inc. (0.81% to P37.40); BDO Unibank, Inc. (0.86% to P129) and Universal Robina Corp. (1.63% to P130.80).
The same list showed eight that lost, including Security Bank Corp. (down 0.19% to P211.60), Megawide Construction Corp. (4.41% to P18.20) and Bank of the Philippine Islands (1.14% to P95.50 apiece).

Peso up ahead of Powell speech

peso dollar bills
THE PESO rebounded ahead of the US Federal Reserve chief’s testimony.

THE PESO bounced back on Tuesday as the dollar weakened across major currencies ahead of the testimony of US Federal Reserve Chairman Jerome Powell and following the stronger remittance data released Monday.
The local unit ended Tuesday’s session at P53.39 against the greenback, 14 centavos stronger than the P53.53-per-dollar finish on Monday.
The peso strengthened a tad immediately on Tuesday as it opened the session at P53.50 versus the dollar. Its intraday low stood at P53.53, while its best showing was at P53.38 against the greenback.
Dollars traded climbed to $504.59 million from the $290.75 million that exchanged hands the previous session.
A foreign exchange trader said the peso finally moved stronger against the greenback as investors wait for the testimony of Mr. Powell at the Capitol Hill.
“Finally, the peso moved stronger on Tuesday ahead of the Powell Senate committee hearing,” the trader said in a phone interview Tuesday.
Mr. Powell will testify before the Senate Banking Committee as he will discuss the monetary policy of the Fed, with the market anticipating for two more rate hikes amid the continued expansion of the American economy.
“The dollar weakened across the board against all major currencies, including the peso, ahead of that hearing,” the trader said.
Meanwhile, Michael L. Ricafort, economist at Rizal Commercial Banking Corp., attributed strengthening of the peso to the good remittances data released on Monday.
Money sent home by Filipinos abroad amounted to $2.469 billion in May, the biggest since December 2017’s record-high $2.741 billion, according to central bank data.
For Wednesday, the first trader expects the peso to move between P53.25 and P53.45, while the other gave a P53.40-P53.60 range amid likely hawkish cues Mr. Powell’s testimony. — Karl Angelo N. Vidal

Filipinos clamor to uphold the Arbitral ruling

As we commemorate the second anniversary of our nation’s victory in the Arbitral Tribunal, we reflect on how the Philippine government has used this landmark ruling to generate support from the international community and to uphold our claims over the West Philippine Sea.
The Stratbase ADR Institute gathered local and international experts from reputable think tanks, universities, representatives from the government and private sectors and other stakeholders to share their views and insights on the consequences of the policy of appeasement of the administration and the threats to the international rules-based order.
One of the guest speakers, Dr. Go Ito from the Meiji University, warned that China’s assertive attitude has been jeopardizing the safety and freedom of navigation in the South China Sea. He emphasized that nothing has changed in the behavior of China despite the historic ruling.
Given this context, he suggested that we have to work with like-minded partners including the United States and Japan to generate support for the arbitral decision.
Natalie Sambhi, Ph.D. candidate from Australia National University, for her part, explained that the Philippines does not want to push back too hard on China because it is one of its biggest trading partners. Even so, she recommended that it is still imperative to resolve territorial disputes through peaceful means and urge other states to refrain from coercive behavior.
For the past two years, the Duterte administration has maintained that China has not breached its “good faith commitment” in the South China Sea despite reports of continued militarization in many of the islands in the area.
Contrary to the administration’s thrusts, the latest national surveys show that majority of the Filipinos want the government to be more assertive in enforcing the 2016 decision of the Permanent Court of Arbitration.
The latest Pulse Asia survey revealed that 73% of Filipinos think that the Philippine government should assert our rights and protect our territorial sovereignty in the West Philippine Sea. According to the same survey, 36% of the Filipinos want our government to file a protest against China in connection to militarization reports and the ruling. On the other hand, 22% want to strengthen our military alliance with other countries, like the US, Japan, and Australia.
A similar nationwide study by the Social Weather Stations revealed an even higher figure of 81% or “four out of five adult Filipinos repudiate the government’s policy of doing nothing about China’s intrusion in the West Philippine Sea.”

protesters
AFP

Clearly, majority of Filipinos want the Philippine government to defend what is ours. Our people deserve a government that is willing to fight for their citizens’ future and not a government that is helpless and weak.
While the government continues to put so much trust on China as an economic partner especially in the areas of infrastructure development and tourism, only 17% of the Filipinos trust China. This is also despite the almost two million Filipino Chinese in the Philippines.
ALL IS NOT LOST
The Philippine victory in the Arbitral Tribunal is concrete proof that small nations like ours can make our voices heard in a rules-based regime.
While the Philippines is not as powerful as China, all is not lost. If we really want to safeguard our interests and protect our rights, we should work with others, bilaterally and multilaterally, to ensure the freedom of navigation that underpins the safety of all our oceangoing trade. All diplomatic avenues need to be exhausted.
The Philippines can engage the members of the Quadrilateral Security Dialogue, also known as the Quad, a loose informal security association of naval powers that can potentially contain China’s expansionist behavior.
Sambhi added that the Philippines doesn’t have to be alone in confronting issues like those facing the fishermen. Australia, for one, can be a partner in upholding the rules-based global order.
Japan, on the other hand, according to Dr. Makoto Seta from Waseda University, has consistently advocated the importance of the rule of law and the use of peaceful means, in settling maritime disputes.
Now more than ever, we have to rally the international community to help enforce the tribunal ruling. More than our legal responsibility, it has become our moral obligation to the Filipino people to protect the victory that we have won and to promote international law in a rules-based regime.
The government needs to reassess which options can better serve the interests of our fellow Filipinos. They can start by listening to the voices of the Filipinos.
 
Prof. Victor Andres “Dindo” C. Manhit is the founder and managing director of the Stratbase Group and president of its policy think tank, Albert del Rosario Institute for Strategic and International Studies (ADRi). Prof. Manhit is a former chair and retired associate professor of Political Science of De La Salle University. He has authored numerous papers on governance, political, and electoral reforms.

The PCC’s draft joint venture guidelines

Just recently, the Philippine Competition Commission (PCC) published the draft Joint Venture Guidelines (Draft Guidelines) aimed to help businesses determine when a joint venture shall be subject to compulsory notification pursuant to its power to issue guidelines on competition matters for the effective enforcement of the Philippine Competition Act (PCA).
Under Philippine setting, a joint venture (JV) may be formed through any of the following schemes, among others: a) incorporation of a new company; b) entering into a contractual JV or; c) acquiring shares in an existing JV entity. The Draft Guidelines provided the basis for computation of the notification thresholds for JV transactions and declared that a transaction is notifiable when parties to a JV meet both the size of party test and size of transaction test.
Pursuant to the Draft Guidelines, the size of party test is met when the aggregate annual gross revenues in, into, or from the Philippines, or value of assets in the Philippines of the ultimate parent entity (UPE) of at least one of the acquiring or acquired entities, including that of all entities that the UPE directly or indirectly controls, exceeds P5 billion.
Meanwhile, under the size of transaction test, the JV is subject to compulsory notification when the aggregate value of the combined assets of the JV partners in the Philippines or contributed into the proposed JV exceed P2 billion, or the gross revenues generated in the Philippines by assets combined or contributed into the JV exceed P2 billion. In the case of the acquisition of shares in an existing JV entity, the Draft Guidelines provide that the assets or gross revenues generated by such assets of the existing JV entity shall be included in determining the threshold.
It is worth noting that, under the Draft Guidelines, a JV is considered as a merger or acquisition when it performs on a lasting basis the functions of an autonomous economic entity, and is expected to bring about a substantial change in the competitive conditions of any market in the Philippines. However, the Draft Guidelines fail to clarify what is meant by “a lasting basis.” The PCC should take this into consideration when finalizing the Draft Guidelines to avoid confusion in its implementation later on.
The Draft Guidelines also mandates that if joint control exists after completion of the transaction, the parties need to make a merger notification. Joint control, which may be established on a de jure or de facto basis, is the ability of the JV partners to substantially influence or direct the actions or decisions of the JV, and exists when an entity has the ability to determine the strategic commercial decisions of the JV (positive joint control), or to veto such strategic decisions (negative joint control), except for ordinary veto rights. A joint control may manifest in different forms such as equality in voting rights or appointment to decision-making bodies, veto rights, joint exercise of voting rights.
However, equity ownership alone does not establish the presence or absence of joint control.
The Draft Guidelines recognize that although a JV Partner may hold a minority stake in the JV, he may still exercise substantial influence on the JV.
Furthermore, the JV arrangement shall be notifiable under the Draft Guidelines once the JV is expected to perform on a lasting basis all the functions of an autonomous economic entity, and to bring substantial change in the competitive conditions of the market in the Philippines. The Draft Guidelines does not consider if the JV is established as a ‘greenfield operation’ or already a previously existing entity. It is likewise provided that a JV created to carry out one or some specific functions of the ultimate parent entity without an independent access to or significant presence in the market may not be considered sufficient to be considered an autonomous economic entity. This may become problematic later on since the fact that a JV is autonomous from an operational perspective does not mean that it enjoys autonomy as regards the adoption of its decisions from its parent companies. In finalizing the draft, the PCC should further clarify the definition of an “autonomous economic entity.”
In the end, the PCC must strive to strike a balance — it must be encouraging and permissive enough to allow the emergence of pro-competitive JVs, while continuing to be the vanguard against activities and transactions that would stifle competition and harm consumer welfare.
The views and opinions expressed in this article are those of the author. This article is for general informational and educational purposes, and not offered as, and does not constitute, legal advice or legal opinion.
 
Mara Kristina O. Recto is an Associate of the Corporate and Special Projects Department of the Angara Abello Concepcion Regala & Cruz Law Offices (ACCRALAW).
morecto@accralaw.com
(632) 830-8000.

Are the Philippines and the US DUI?

DUI is a dreaded term among vehicle drivers in the US. It means Driving Under the Influence of alcohol or drugs.
Being arrested for DUI, at its most benign, means a brief stay in jail, a hefty fine and penalties, suspension of your driver’s license for several months, several weeks of lectures on traffic safety, and an increase in your car insurance premium. All that, in addition to the embarrassment that comes with this infraction.
It could be worse, of course.
DUI could mean loss of lives and property and more severe financial and criminal damages.
It has become almost routine to compare the governance of President Rodrigo Duterte and President Donald Trump and characterizing them as DUI, both in the political and economic sense. Both heads of state have certainly demonstrated a tendency to be reckless — like drunk drivers — and to be insensitive to criticism (if you’re boozed, you feel no shame).
But I believe there is a significant difference between the motivations of the two. I believe that Duterte, for all of his profanity and crassness, sincerely wants to do a good job as president and leave a positive legacy when he vacates the office.
Duterte’s logic is that of a street toughie who thinks that the solution to every problem is santong paspasan, and when he runs out of viable reasons, he resorts to invectives. But his loyal supporters insist that he means well, like the barumbado (trouble-maker) heroes of Filipino movies.
And mind you, not all of Duterte’s supporters belong to the bakya crowd. I know of one relatively young and reasonably intelligent publisher of a provincial paper who instinctively applies his slippery logic to rationalize Duterte’s antics (like calling God “stupid”). His constant presence on social media is surely being appreciated by Malacañang but I doubt that he is on Martin Andanar’s payroll. He simply is convinced that Duterte is good for the country (at least, better than Noynoy Aquino).
Donald Trump also has die-hard supporters and they are probably as sincere in their appreciation of what Trump represents and what he holds for America. Of course, many of these supporters are neo-Nazis and white supremacists, but many more are average folk who feel that the American dream has slipped through their fingers and anyone who promises to recover it for them is worth believing.
However, I am convinced that Trump himself — unlike Duterte — is not sincere about being of service to his country. I believe that Donald Trump’s principal concern is Donald Trump and his survival as president of the United States.
More and more, that survival is becoming tenuous and doubtful.
But one should never underestimate a man who claims to have amassed $10 billion in wealth while declaring corporate bankruptcies six times. His sleazy logic: He used the loopholes in the law.
Trump has shown himself to be a person who will make a deal with the devil in order to survive. I think that, unlike Duterte who is concerned about his legacy, Trump is only concerned about hanging on to a presidency that he originally did not expect to win, in the first place, but which he has since insisted that he won by an “unprecedented margin.” That’s why he has rejected any suggestion that he was aided by outside forces like Russia.
About Trump’s legacy — he has already decreed that he is the most popular president of the US, more popular than Abraham Lincoln, and that he has achieved more in his brief stay in the White House than all past presidents combined.
Trump is a certified megalomaniac. He is also impervious to shame, epitomizing that rock-faced character who declares, “Lumilipas din ang hiya!” (Shame passes).
The fact that he is considered the world’s most insulted head of state alive (Uganda’s Idi Amin is dead) may, in fact, be a source of demented pride for him.
But things may soon be coming to a head.
Trump may have pushed his luck too far with his recent “summit” with Russia’s Vladimir Putin in Helsinki, and his subsequent statements on such serious issues as Russian meddling in the last presidential elections. This meddling has been confirmed and reported by the US intelligence community, and has been followed by indictments handed down by the US Department of Justice against specifically named Russian agents.
Over the past months, while Republican leaders have grudgingly acknowledged that Trump’s economic and foreign affairs forays (such as the trade war and his verbal attacks on NATO allies) have been similar to that of a drunk driver careening on a zigzag road, they have avoided criticizing Trump publicly because of the latter’s popularity with Republican voters.
Gallup polls have shown Trump’s approval rating among self-identified Republicans at above 80%. And in recent Republican primaries, preparatory to the 2018 midterm elections, candidates who have bucked Trump have lost to out-and-out Trump surrogates.
Only the Democrats have criticized Trump loudly, but both houses of Congress are controlled by the Republicans. Because the latter want to avoid losing that control in the coming elections, the Republican leaders have studiously avoided offending Trump.
But in the wake of Trump’s statements at the joint press conference with Putin, the dam may have been breached.
On the subject of allegations of Russian interference in the elections, Trump was quoted in media as follows, “My people came to me, Dan Coats came to me and some others, and said that we think it’s Russia. I have President Putin; he just said it’s not Russia. I will say this. I don’t see any reason why it should be.”
At this, Coats, a former Republican senator who is now the Director of National Intelligence and is, in effect, America’s top spy, issued the following official statement, directly contradicting Trump:
“The role of the Intelligence Community is to provide the best information and fact-based assessments possible for the President and policy makers. We have been clear in our assessments of Russian meddling in the 2016 elections and their ongoing, pervasive efforts to undermine our democracy, and we will continue to provide unvarnished and objective intelligence in support of our national security.”
Significantly, Coats did not clear his statement with the White House.
Top Republicans in the Senate and the House have also openly rebuked Trump, while declaring full support for the report of the US intelligence community.
Speaker Paul Ryan, who has always managed to pad his comments on Trump with soft gloves, displayed his bare fists this time:
“There is no question that Russia interfered in our election and continues attempts to undermine democracy here and around the world. That is not just the finding of the American intelligence community but also the House Committee on Intelligence.”
Senate Majority Leader Mitch McConnell, who has also been shy about criticizing Trump, told reporters:
“I’ve said a number of times and I say it again, the Russians are not our friends and I entirely believe the assessment of our intelligence community.”
However, the Republican Senate head, like a typical politician, avoided answering the question on whether he would frontally tell Trump of his disagreement with the latter.
On the other hand, maverick Sen. John McCain, who has been consistently critical of Trump and his policies, characterized Trump’s comments as “one of the most disgraceful performances by an American president in memory.”
Mitt Romney, a former Republican presidential candidate who is currently running for the Senate, called Trump’s statements, “disgraceful.”
Former CIA director John Brennan, a national security analyst for NBC News and MSNBC called Trump’s actuations, “nothing sort of treasonous.”
Texas Republican Rep. Will Hurd, a former CIA officer, had choice words to say about Trump: “I’ve seen Russian intelligence manipulate many people in my career, and I never would have thought the US President would be one of them.”
Which brings me to the question: If Donald is DUI (driving under the influence), is he DUIP (driving under the influence of Putin)? Perhaps because of Russian prostitutes peeing on Trump?
 
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

Priority must be non-tertiary education

By Benjamin R. Punongbayan
FOR AS LONG as I can remember, greater attention has been given to tertiary education, as compared to elementary and high school education, in both public policy and private scholarship activities. This tendency is clearly apparent in the current development of providing free tuition to students in state universities. Given the current state of scarce financial resources, I feel that such priority is misplaced. Not only that, such a policy is arbitrarily selective and, therefore, unfair. But that is a different matter and I’ll leave it at that for the time being.
There is a lot of talk about the widespread poverty in the country; everyone tries to express their own view on how to reduce it. If one examines this problem, a clear picture emerges: poor parents almost always did not complete high school or even elementary school. These parents tend to have more children, and the common resulting condition is that these children will also not finish high school. Thus, the poverty cycle goes on and on, and simply cannot be broken.
The government, of course, has an adult education program, but it cannot achieve its full potential due to budgetary constraints. It also needs more effective marketing.
Then there is the Technical Education and Skills Development Authority (TESDA); its full potential, however, could also not be realized, because of inadequate budget allocation. My observation and experience with TESDA is that acquiring technical skills through them requires a significant cost outlay on the part of the trainees. In welding and dressmaking courses, for example, the trainees themselves need to buy the materials needed for training, such as shoes, eye protection gear, and iron blocks. In dressmaking, the cloth and thread needed for teaching sewing have to be bought by the trainees. The same is true for other TESDA courses. Moreover, the trainees are required to wear uniforms that they buy themselves. When the trainees finish the program, they have to pay fees to get their National Certificate (NC) 1 and 2. The training centers are usually in cities and large towns, so potential trainees in other smaller towns cannot access the TESDA, because of lack of money for transportation and meals. All told, TESDA training courses are generally not accessible to people who badly need them.
The government recently established the new K-12 non-tertiary curriculum, which is a very commendable step. However, there is also the problem of inadequate budget, especially for vocational courses in Grades 11 and 12. My high school alma mater in Tondo circulated to some of its alumni a wish list to acquire various equipment, among which are for teaching vocational courses. The equipment for vocational courses on the wish list reach a total cost of about ₱300,000. And that is only one public high school in the entire country.
It is no wonder that we cannot make a big dent in reducing widespread poverty in the country. The poor continue to lack the skills required for them to find reasonably paying and stable employment. While non-tertiary schools are tuition-free, the poor could not make use of them fully, as they lack money for meals, transportation, and school projects. TESDA vocational courses also require significant cost outlay on the part of the trainees; there is also the barrier-to-entry factor for the costs of meals and transportation while undergoing training.
The poor will forever remain poor if they cannot acquire skills better than what they presently possess. Most of these poor Filipinos reside in rural areas and do not own land that they can till. As such, they can only find agricultural and construction jobs that are seasonal and low-paying. The mix of the existing manufacturing sector is such that it cannot employ a large number of unskilled and semi-skilled labor, more so in the services sector, where much of the economic activities presently reside.
For the past several years, the drivers of the Philippine economy are in two areas: the Philippine work force that gets employed overseas and foreign jobs that are outsourced to Philippine shores. It appears that this will be the case for many more years. In both these sectors, the minimum qualification to get employed is a high school education or some vocational skills. Clearly, the poor cannot access these employment opportunities. Other economic activities do not provide good prospects to them either. Agriculture has never been a factor in recent years. We have lost low-skill manufacturing to low-cost countries, such as China, and there is no prospect of recovering them. Moreover, the historical trend is for the services industry to get an incrementally greater share in the total economic pie, but employment in this sector requires higher education and skills.

TESDA trainees
Trainees assemble electronic parts of a solar lantern at a workshop inside the Technical Education and Skills Development Authority (TESDA) headquarters in Manila. — AFP

Based on the 2010 census released in 2013, the magnitude of the existing pool of unemployable and underemployed labor is huge. That census showed a total population of 82 million, of which 57 million were 17 years old and older. Of this age group, the highest educational attainment of 24 million Filipinos or 41% of this age group was high school undergraduate, which means they did not finish high school. While this age group included those who were 60 years old and above, the total of which I was not able to extricate from the reference that I was able to access, these statistics indicate a huge number of unemployable and underemployed Filipinos in 2010. With the continuous rapid growth in population since 2010, the total number of this labor pool would have increased to the present time, although the proportion to the total population might have somewhat decreased. Indeed, it is no wonder why poverty persists in our country.
If we really want to reduce widespread poverty, we need to get the greatest number of Filipinos to at least finish high school, and then open the way for the high school graduates to acquire vocational skills. The basic structures already exist. All that is needed is to put more money in activities that will effectively achieve this objective and improve the effectiveness of the organization and administration devoted to this endeavor.
The basic problem of the poor is lack of money to support their children throughout their elementary, secondary, and vocational education. I do not see any reason why the government cannot provide free meals to all those who need them. Such a public policy is being implemented in many countries. Providing free transportation to poor students in elementary and high schools should not be too expensive; schools are not far from the residences of the schoolers. Providing free-fare buses roving around school routes or giving free transportation vouchers to poor students should do it.
The equipment and teaching needs for vocational courses for Grades 11 and 12 in public high schools must be fully funded. Another option would be to integrate such courses with TESDA’s. TESDA training should be made totally free at the very least. To solve the problem of cost of trainee meals and transportation, roving training facilities should be extensively expanded to cover town clusters within the entire country until the objective has been substantially met.
The barangay system should be used to get all school-age children and youth to remain in schools and finish their education. Solutions to specific problems must be found with the help of the town government.
Getting these things done is not rocket science. What are needed are clear focus, effective administration, persistence and, most importantly, having the government prioritize funding for all necessary activities.
If we cannot make the poor sustainably employable under the current economic structure and conditions, I do not think we can break the cycle of poverty in any meaningful way, despite what our economic managers are saying about driving for high economic growth to reduce poverty as a result. The focus should be the other way around.
 
Benjamin R. Punongbayan (ben.buklod@yahoo.com) is the founder of Punongbayan & Araullo, one of the Philippines’ leading auditing firms.

Beermen try to close out Alaska Aces in Game Three

By Michael Angelo S. Murillo
Senior Reporter
JUST a win away from returning to the finals of the Philippine Basketball Association (PBA) Commissioner’s Cup, defending champions San Miguel Beermen go for the clincher when they collide with the Alaska Aces in Game Three of their best-of-five semifinal series today at the Smart Araneta Coliseum.
Went 2-0 up in the series after repeating over the Aces in Game Two, 105-94, on Monday, the Beermen said that they would make full use of the position of advantage they are now in, beginning in their scheduled 7 p.m. joust at hand.
“With this victory (Game Two) we put Alaska in a difficult position. It’s hard going down 0-2 in a best-of-five series. But we are not counting them out yet. They have a good coaching staff led by coach Alex Compton and they will continue to fight it out. We have to continue playing hard and be ready,” said San Miguel coach Leo Austria in the postgame press conference following Game Two.
In moving on the verge of another finals appearance, San Miguel used a strong second half to turn the tables on Alaska en route to the victory.
Import Renaldo Balkman led the way for the Beermen with 31 points and 10 rebounds with June Mar Fajardo, named player of the game, adding 21 points and 18 rebounds.
Guards Chris Ross and Alex Cabagnot, for their part, added 16 and 14 points, respectively.
Diamon Simpson, meanwhile, paced the Aces with 19 points and 15 boards.
Simon Enciso also had 19 while Vic Manuel finished with 15 for Alaska, which continued to play sans Chris Banchero (personal emergency) and Calvin Abueva (team suspension).
“Credit Alaska for making it tough for us in the first half. We’re fortunate to have been able to come back in the second half on the strength of our defense,” said Mr. Austria of their win.
While recognizing they have an uphill battle ahead of them down 0-2, Alaska coach Compton, meanwhile, refused to give up and vowed that his team will continue fighting.
“We are not giving up. Yes we are down in the series and we are missing some key players. But we will not use those as an excuse not to play our best. As long as there are still games to be played we will continue fighting,” said Mr. Compton following Game Two.

Bad weather forces cancellation of PBA, NCAA games

BAD weather triggered by tropical storm Henry forced the cancellation of games in the Philippine Basketball Association (PBA) and National Collegiate Athletic Association (NCAA) on Tuesday.
Citing the safety of fans, players and officials amid floods and strong rains brought by the storm, both the PBA and NCAA said they had no recourse but to call off the scheduled matches.
In a statement, PBA Commissioner Willie Marcial said the league was canceling Game Two of the best-of-five Commissioner’s Cup semifinal series between the Barangay Ginebra San Miguel Kings and Rain or Shine Elasto Painters “due to floods and the continuing inclement weather.”
“The safety and security of fans, players and officials are always of utmost importance,” Mr. Marcial underscored in his statement.
The statement went on to say that Game Two will push through on Thursday, July 19, still at the Smart Araneta Coliseum and at 7 p.m.
Barangay Ginebra leads the series, 1-0.
Over at the NCAA, the league decided to suspend the scheduled six matches yesterday at the FilOil Flying V Centre in San Juan City but not after allowing the opening game to get under way first.
After careful assessment, the NCAA eventually decided to suspend the game between the juniors teams of University of Perpertual Help and Arellano University after the first quarter and those slated for the rest of the day.
When play was halted, the Junior Altas were ahead of the Braves, 21-19.
NCAA Management Committee Chairman Frank Gusi of Perpetual Help said the halted game along with the others that were postponed will be re-played and rescheduled at the end of the first round of eliminations.
Other games slated yesterday were juniors games between Colegio de San Juan de Letran and Mapua Institute of Technology and San Beda University and Jose Rizal University as well seniors matches between the Altas and Chiefs, Knights versus Cardinals, and Red Lions against Heavy Bombers.
Yesterday’s cancellation was the second early in NCAA season 94 after games on July 17 were also postponed because of bad weather as well. — Michael Angelo S. Murillo

Postscript to Fight of Champions: Left uppercut and Buboy Fernandez

By Michael Angelo S. Murillo
Senior Reporter
IN a rather surprising performance on Sunday at the “Fight of Champions” in Kuala Lumpur, Malaysia, Filipino boxing legend Manny “Pacman” Pacquiao became a world champion anew at the age of 39 years old after defeating Argentinean Lucas “La Maquina” Matthysse via a seventh-round technical knockout to seize the World Boxing Association world welterweight title.
Showing power and speed that many thought he no longer had, Mr. Pacquiao dominated the erstwhile champion right from the opening bell, knocking Mr. Matthysse down three times, the last one in the seventh round that forced referee Kenny Bayless to signal off the fight and eventually proclaim the Filipino superstar as the new champion.
For local combat sports analyst Nissi Icasiano, two things stood out for Mr. Pacquiao in Fight of Champions — a key piece in his arsenal in the left uppercut and the good job trainer and friend Buboy Fernandez did in preparing him for the fight.
“Manny Pacquiao surprised everyone with a spectacular performance against Lucas Matthysse. He did show shades of his vintage form. I believe his drubbing of Matthysse is his best performance since 2011. Although he was active in throwing his best shots from rounds one to seven, you would notice that he remained patient and calculated,” said Mr. Icasiano in an interview with BusinessWorld following the fight on Sunday.
“I also noticed that he found another key piece in his arsenal, which was the left uppercut that brought down the Argentinean twice in the fight. Now it makes me wonder why Pacquiao did not throw his uppercut as much throughout his career. I will give Buboy Fernandez a pat on the back for this. Got to give credit where it’s due,” he added.
Performing the way he did against Matthysse, Mr. Icasiano said perhaps Mr. Pacquiao is signaling that he is not about done in boxing even as he said that if it were up to him he would suggest for the Pacman to call it a career now on a high and good note.
“After a sensational victory over Matthysse, I believe Manny eyes a super-fight against Vasyl Lomachenko. He also wants a date with Amir Khan. But for me, it’s time for him to call it a career. He is back on top of his game. He earned his 12th world title in eight different weight classes. Not everyone gets a glorious exit from the sport, and he deserves a storybook ending,” Mr. Icasiano said.
As for Mr. Fernandez, the dynamic between him and Mr. Pacquiao, honed by longtime friendship and partnership, could not be denied, Mr. Icasiano said, and that if the Pacman decides to go with him the rest of his career it would be fine.
The analyst, however, said that he is not ruling out the return of American Freddie Roach, who trained Mr. Pacquiao for much of his storied career, more so if the fighter still seeks to take on the best in the game right now.
“Buboy did wonders for Manny Pacquiao in this (Matthysse) fight. He made Manny look great again. However, if he seeks to duke it out with Lomachenko or the other champions of the division such as Terrence Crawford, Errol Spence and Keith Thurman, he will need a great mind such as Freddie Roach in his corner to devise a great game plan,” Mr. Icasiano said.
The Matthysse win was the 60th for Mr. Pacquiao as opposed to seven losses and two draws.
It was the first stoppage victory for him in nine years. The last time he won in such a fashion was in November 2009 when he defeated Miguel Cotto by technical knockout in the 12th round to win the World Boxing Organization welterweight title.
Mr. Pacquiao said he is going to enjoy his latest victory first and return to work as a senator of the republic before making his decision on his next move in the boxing ring.

Davide: Duterte can still run as transition president

By Camille A. Aguinaldo, Reporter
RETIRED chief justice Hilario G. Davide, Jr. on Tuesday said the revised transitory provisions of the proposed Federal Constitution still allow President Rodrigo R. Duterte to run as transition president.
At the resumption of the Senate hearing on Charter change, Mr. Davide said the country may have two presidents if the ratification of the new Constitution is done before 2022, the scheduled shift to a federal system. He said this “anomaly” would allow the incumbent president and vice-president to run for the transition elections.
“The catch here is that the incumbent President is not prohibited from running as transition president. To avoid, therefore, the anomaly of having two presidents and vice-presidents during the transition period, the incumbent is allowed to run as transition president, but not for president under the new federal constitution. He will surely win,” Mr. Davide said.
The Senate committee on constitutional amendments and revision of codes, chaired by Senator Francis N. Pangilinan resumed its inquiry into the pending proposals to amend the 1987 Constitution, with the members of the Consultative Committee to review the 1987 Constitution (ConCom) presenting to the Senate its proposed Federal Constitution.
The ConCom released to media on Tuesday its revised federal constitution, consistent with Mr. Duterte’s orders to remove his availability for reelection under the new constitution.
In the revised federal charter, the ConCom indicated that the term of the president and vice-president will end on June 30, 2022 and will not be extended. It also barred the incumbent president from seeking reelection in the 2022 elections.
Within six months from ratification of the new constitution, the consultative body proposed that the President call for an election for the transition president and vice-president in tandem. The two officials will also be ineligible to run for office in the May 2022 elections. The transition president will be tasked to preside over the transition toward federalism. He or she will also exercise all the powers of the president under the federal constitution until June 30, 2022.
For his part, former Senate president and ConCom member Aquilino Q. Pimentel, Jr. maintained that Mr. Duterte does not want to be the transition president.
“President Duterte does not want to give an impression that he wants to stay in power. Even the transitory presidency, he does not like it,” he told reporters.
Malacañang on Tuesday said it hopes the revised federal constitution will address concerns over Mr. Duterte’s “other motives” to shift to federalism.
“This should finally allay fears that PRRD has other motives for wanting to shift to a federal form of government,” Presidential Spokesperson Harry L. Roque, Jr. said in a statement.
‘CHACHA TRAIN CAN NOW STOP’
However, Mr. Davide noted that with the powers of the transition president, “it would still not be unlikely that the transition plan and his power could make (Mr. Duterte) rule beyond” June 30, 2022.
He said proposals to amend the Constitution “may permanently stop,” now that the Supreme Court has ruled on expanding the Internal Revenue Allotment (IRA) of local government units on national taxes.
“As reported, the Supreme Court en banc has effectively delivered a mortal blow — a coup de grace — on federalism, by demolishing or striking down the principal reason given by its proponents for its adoption: removing Imperial Manila and recognizing the right of the LGUs to a genuine share in national funds and resources. The Court ruled that the 40% IRA for the LGUs shall be based on all ‘national taxes,’ not only on ‘internal revenue taxes,’” Mr. Davide said.
“The Chacha train can now permanently stop,” he added.
Nevertheless, the retired chief justice also recommended that the Senate approve a resolution by Senate Minority Leader Franklin M. Drilon calling for a constitutional convention to propose amendments to the Constitution.
University of the Philippines political-science professor Gene L. Pilapil echoed Mr. Davide’s sentiments and noted the lack of a “believable transition plan” toward federalism.
“There is a very high risk of bringing the country not into a dizzying pace of change but, as institutional design literature has warned in terms of unintended consequences, of bringing the country to a near standstill because of the enormity of the tasks needed to create all the new institutions of the ConCom Constitution,” Mr. Pilapil also said.
At the Pandesal Forum in Quezon City on Tuesday, lawyer Jose Martin A. Loon of the ConCom appealed to political leaders “not to politicize the discussions on charter change, because it is for the benefit of all Filipinos and not to favor any political group or faction.”
In his statement, ConCom media and technological officer Conrado I. Generoso said, “It is not correct that fewer people agree to have the constitution changed as may be seen in the same survey of Pulse Asia.”
Mr. Generoso said it was “wrong to lump together” the 30% in the survey who voted “Not now but sometime in the future” and the 37% who voted “Not ever” on charter change.
He said the 30% should be combined with those who voted yes for charter change (18%) because their answer can be seen as a “qualified yes.”
“So in reality 48% favor changing the Constitution,” Mr. Generoso said.
For his part, Magdalo Representative Gary C. Alejano said in a statement Tuesday: “Clearly, there is no public clamor. Worse, the people do not have the capacity and understanding, as of the moment, to engage in the process of charter change. This attempt is premature.” — with reports by Gillian M. Cortez and Charmaine A. Tadalan

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