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Raonic tramples Troicki on return in Japan Open

TOKYO — Canada’s Milos Raonic looked sharp on his return from wrist surgery Tuesday as he battered Serbian Viktor Troicki 6-3, 6-4 in the first round of the Japan Open.

The third seed, who was forced to sit out the US Open due to a persistent problem with his left wrist, displayed very few signs of rust after a seven-week absence, taking just 71 minutes to blast his way into the last 16.

A right-hander with a double-fisted backhand, Raonic tore through the opening set in bright Tokyo sunshine and secured the key break early in the second with a cleverly disguised drop shot.

Troicki fought gamely but when a Raonic volley clipped the net and trickled over, the Serb slammed his racquet to the ground in disgust and bellowed furiously at the Japanese crowd.

Raonic, a former world number three and winner of eight ATP Tour singles titles, rifled 16 aces to pile the misery on Troicki, completing victory with a kicking serve that his opponent could only waft into the net.

Currently ranked 12th, Raonic finished runner-up at the Japan Open three years running from 2012-2014, twice to local favorite Kei Nishikori.

The former Wimbledon finalist faces either 2015 Tokyo runner-up Benoit Paire of France or Japan’s Yuichi Sugita.

Elsewhere, Frenchman Richard Gasquet, another former Japan Open finalist, upset American sixth seed Sam Querrey 6-4, 7-6 after clinically winning the second-set breaker 7-2.

Croatian Marin Cilic heads the Tokyo field this year at a tournament whose list of former champions includes tennis greats Ken Rosewall, John McEnroe, Pete Sampras, Roger Federer and Rafael Nadal. — AFP

BSP loan program for MSMEs opened in Cauayan City

THE CREDIT Surety Fund (CSF) — a program developed by the Bangko Sentral ng Pilipinas (BSP) to help increase the credit-worthiness of micro, small and medium-scale enterprises (MSMEs) and give them access to loans — was launched in Cauayan City, Isabela on Oct. 2, the 50th nationwide. The CSF is established by pooling the contributions of cooperatives, nongovernment organizations, local government units and partner institutions such as Development Bank of the Philippines, Land Bank of the Philippines, Industrial Guarantee and Loan Fund, as well as other interested parties. An MSME member can then submit a loan proposal for evaluation. Seven cooperatives were qualified to join the Cauayan CSF, contributing a total of P3 million, the BSP said in a statement. The Cauayan City government pledged another P3 million, while the partner government financial institutions are also expected to put up counterpart contributions. The CSF, established in 2008, operates in 31 provinces and 19 cities nationwide, with total loans reaching P3.8 billion as of Sept. 15 this year for more than 16,000 beneficiaries.

Heartland rocker Tom Petty, 66

NEW YORK – Tom Petty, the heartland rocker whose classic melodies but dark storytelling created a string of hits over four decades, died Monday of cardiac arrest, his family said. He was 66.

His family confirmed that Petty passed away Monday evening surrounded by loved ones after a confusing day in which several media outlets reported and then retracted premature news of his death.

“On behalf of the Tom Petty family we are devastated to announce the untimely death of our father, husband, brother, leader and friend Tom Petty,” a family statement said.

Petty early Monday suffered cardiac arrest at his home in Malibu, just a week after he closed his career in a triumphant fashion.

The rocker had played three sold-out shows at the iconic Hollywood Bowl to wrap up a tour celebrating 40 years of his band the Heartbreakers.

He closed the encore with one of his earliest and best-known songs – “American Girl,” which tells of an ambitious girl “raised on promises” now contemplating suicide, set to guitar harmonies from the golden age of rock ‘n’ roll.

The song was one of many by Petty about struggling to overcome long odds. “I Won’t Back Down,” perhaps his best-known song, took on a second life as a US patriotic anthem after the Sept. 11, 2001 attacks.

The singer and guitarist – recognizable for his shoulder-length blonde hair – delivered his vocals in short punches that let on an underlying anger, such as on “You Don’t Know How It Feels.”

The rocker’s characters – small-town Americans full of aspirations but running into a wall of setbacks – reflected the hardscrabble early life of Petty.

His grandfather was a logger from Georgia rumored to have fled south to Florida after axing a man to death in an argument. Petty was born in Gainesville, the university town in northern Florida, to a belligerently drunk father who sold wholesale tobacco and candy.

Petty once recalled that his father, intoxicated and unimpressed by his son’s passion for music, once smashed up the boy’s record collection.

The future rocker said he told him, “Dad, if you’ll just leave me alone, I’ll be a millionaire by the time I’m 35.” It was a prediction that proved prophetic.

ROCK AS EARLY ESCAPE
Petty, speaking in 2015 to Men’s Journal, credited his mother Kitty with saving him by making sure “to show us there was more to life than rednecks.”

“She read to me a lot. And she liked music: She had a record player and would play Nat King Cole and the West Side Story soundtrack. I think of her every time I hear those songs,” he said.

But he remained consumed by inner rage.

“Any authority I didn’t agree with could just make me go crazy,” he said of his early life haunted by his father.

He struggled with depression most of his life and formed an addiction to heroin, although later in his life his only vice was marijuana and he instead embraced transcendental meditation to calm himself.

Petty embraced the country influences of the South, especially when he crafted the 1985 concept album Southern Accents.

Touring the United States, he flew a Confederate flag on stage – a decision he later regretted, telling Rolling Stone that “people just need to think about how it looks to a black person” as he likened the controversial symbol to a Nazi swastika.

In a speech in February as he was presented a lifetime award at the Grammys, Petty said he owed a debt to African Americans such as Chuck Berry whom he credited as the creators of rock ‘n’ roll.

But like so many music fans of his generation, he discovered rock ‘n’ roll via Britain when he saw The Beatles perform on The Ed Sullivan Show in 1964.

“I had my eyes opened like so many others and I joined the conspiracy to put black music on the popular white radio,” Petty said.

CAMPAIGNER FOR ARTISTS
Petty in the late 1980s joined one of The Beatles, George Harrison, in a supergroup, the Traveling Wilburys, that also featured Bob Dylan. The project was short-lived after the death of another member, Roy Orbison.

Fresh from the glory of the Wilburys, Petty – long backed by the Heartbreakers – in 1989 released his first solo album, Full Moon Fever, which featured the wistful “Free Fallin’” and “Runnin’ Down a Dream” as well as “I Won’t Back Down.”

Other major hits by Petty included “Don’t Come Around Here No More,” written with David A. Stewart of New Wave duo The Eurythmics. The track’s playful video, themed around Alice in Wonderland, cemented Petty’s reputation as a favorite among stoners.

The three-time Grammy winner was steadfast on artistic control and had a reputation for battling with the music industry – most memorably with the 1981 album Hard Promises after he was angered by his label’s plan to put the store price higher than usual.

More recently, English singer Sam Smith agreed to credit Petty as a songwriter on his worldwide hit ballad “Stay With Me” due to the similarities – coincidental, by all accounts – in the chorus to worldwide hit “I Won’t Back Down.” – AFP

KTM adds 250 F to Freeride range

IT’S the “ultimate all-rounder for run trails, trials and enduro,” KTM bills its freshly released Freeride 250 F.

The latest addition to KTM’s Freeride range packs a new 250cc, DOHC, four-stroke engine within a reworked and lighter composite frame that’s mounted on an Xplor suspension. Because the engine itself is smaller and lighter than the previous 250cc units, the bike tips the scales at less than 99 kilograms. This, according to KTM, makes the Freeride 250 F a “great choice for riders looking for an alternative to traditional trials or enduro machines, or those new to the sport of off-road motorcycling.”

Announcing the bike’s new hardware is a slim bodywork marked by new front fender, headlight mask, low seat and other updated pieces. Along with these, also offered by KTM are its PowerParts and PowerWear kits, which are basically an array of apparel and other riding gear, as well as performance parts and accessories.

KTM has launched the Freeride 250 F as a 2018 model in Europe, with deliveries to other markets following soon.

A PSA on the Public Services Act

The World Economic Forum (WEF) released its 2017-2018 edition of the Global Competitiveness Index last week, and the results are hardly surprising. The Philippines’ overall ranking stagnated at 56th place, trailing — as usual — most of the ASEAN-6. Unfortunately, the country fared much worse, at 97th, on the WEF indicator that measures the extent to which rules and regulations impact foreign direct investment or FDI. This puts the Philippines in the second-to-last spot among other ASEAN-6 countries. Vietnam had the 105th spot.

For the first half of the year, FDI inflows sank by 14%. Total inflows amounted to around $3.6 Billion. The central bank explained the decline to a steep drop in net equity capital, or foreign companies’ stakes in local businesses. Total approved foreign investment (prospective investments from foreigners) also contracted, by an even worse rate of 36.4% during the same period. If this decline is not surprising, it’s because the writing was on the wall at around this time last year, when a Standard Chartered Bank survey reportedly revealed that investors looking at Southeast Asia preferred to locate in Vietnam and Cambodia over the Philippines. In that survey, only 3% of executives had said they were interested in the Philippines. Needless to say, the country’s FDI inflows still lag behind our counterparts in the ASEAN-6.

AMENDING THE PSA IS TAKING A LARGER STEP FORWARD
In line with the administration’s 10-point socioeconomic agenda, the country’s economic managers have sought to relax restrictions on foreign ownership in an effort to increase our attractiveness to investors. Currently, the final draft of the 11th Regular Foreign Investment Negative List (RFINL), which lists the sectors that are off-limits to investors, is under review.

In the last two decades, notable changes to the list have usually been limited. To date, major reforms include allowing foreign investments in retail trade with a minimum capital above $2.5 million and permitting 100% foreign equity in banking and insurance.

In contrast to the conservative changes to the RFINL in the previous administrations, Cabinet secretaries under the Duterte government have already pledged that they will relax the RFINL as much as possible. Finance Secretary Sonny Dominguez promised a “very liberal” RFINL. Economic Planning Secretary Ernesto Pernia pushed for further revisions to an earlier draft of the RFINL as he wanted it to be “more aggressive.” As reported in the regional press, both Secretary Dominguez and Secretary Pernia reiterated their preference for further liberalizing the investment environment during their recent visit to China.

However, while these statements are encouraging, the executive branch can only do so much. Certain items on the negative list can only be relaxed by Congress.

The RFINL, for example, still limits foreign investments to 40% on the operation of public utilities, as indicated in the 1987 Constitution. However, the constitution does not have a statutory definition of a public utility. The Public Services Act (PSA), crafted during the Commonwealth era, defines public services, but not public utility, failing to distinguish the two terms.

Under the archaic law, public services broadly include transport, power and water supply, and telecommunications. Both terms have been used interchangeably since, prohibiting foreign participation in sectors such as transportation and telecommunications.

Capital and technological infusions for transport and telecommunications are particularly crucial. Ride-sharing services, for example, have proliferated due to the inadequacies of the public transport system. As colleagues from the Foundation for Economic Freedom have argued, there is a need to account for this wave of technology-enabled transport services in order to serve and protect the public better.

PROSPECTS FOR THE PSA
The PSA was crafted in 1936 — it’s older than our Republic! — and may have served the purposes of its time. However, the law must be amended to cater to the demands of the present. This calls for an amendment of the Public Services Act to update the definition of public utilities to allow for more foreign participation in key sectors.

In August, the Legislative-Executive Development Advisory Council (LEDAC) included the amendment of the PSA as one of its 28 priority measures. So far, the bill has made progress in Congress. Thankfully, House Bill 5828 recently hurdled the third hearing in the House of Representatives.

Under the proposed bill, public utilities are defined and limited to the distribution and transmission of electricity, as well as the distribution of water and sewerage. Hopefully the Senate can take this up soon.

Our country’s rapid economic expansion has failed to convert into faster investment inflows. To be sure, our dismal FDI performance is also rooted in long-standing concerns including inefficiency in the bureaucracy, corruption and red tape, and poor infrastructure quality. Taking on these reforms and reaping its benefits will take years.

In the meantime, pushing for legislative amendments is a relatively faster remedy to our restrictive FDI environment. The simple act of defining public utilities allow for greater competition in the market by opening it to more players. This will result to an improved quality of services and lower prices. Local firms will not lose out, they will simply be more incentivized to innovate continuously in the face of stiffer competition, ultimately making them more competitive in the global arena.

 

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.

Major League Baseball: Indians, Dodgers teams to beat as playoffs begin

WASHINGTON — The Cleveland Indians, seeking their first crown since 1948, and the Los Angeles Dodgers, whose title drought only dates to 1988, are the clubs to beat as the Major League Baseball playoffs begin.

Only last year, the Chicago Cubs ended the longest title drought in North American sports history, winning their first World Series crown since 1908 by defeating Cleveland in a dramatic seventh-game showdown.

Now the Indians, who unleashed an American League (AL)-record 22-game win streak, are back in the playoffs and with the AL’s best record at 102-60, the second-most season wins in club history. Now they own baseball’s longest title drought.

The Indians boast one of baseball’s top pitchers in right-hander Corey Kluber, who went 18-4 with a majors-best 2.25 earned-run average and 265 strikeouts this season. And Tribe right-hander Carlos Carrasco of Venezuela went 18-6.

Indians outfielder Jay Bruce, who joined Cleveland at mid-season, could feel the hunger for another chance at the crown the minute he walked into the locker room.

While Cleveland lost the World Series to a team with a championship drought 40 years longer than their own, they could face a team whose title drought is 40 years shorter in the Dodgers, who led the major leagues with a 104-5.

And the Dodgers counter with a mound ace of their own in left-hander Clayton Kershaw, who went 18-4 with a National League (NL)-best 2.31 ERA, second only to Kluber in the majors, and 202 strikeouts. Los Angeles also features right-handed closer Kenley Jansen, whose 41 saves shared the NL best.

The playoffs open with two one-game wildcard showdowns between the best non-division winners — the New York Yankees entertain Minnesota on Tuesday in the American League while Colorado will visit Arizona on Wednesday.

The Yankees-Twins winner gets a best-of-five series against the Indians that opens at Cleveland on Thursday, the same day the Boston Red Sox visit Houston in the other American League semifinal series.

In the National League, the Colorado-Arizona winner visits the Dodgers to open their National League semi-final series while the defending champion Cubs travel to Washington for their opening matchup.

Yankees’ slugger Aaron Judge led the AL with 52 home runs and his powerful hitting could spark the 27-time World Series champions to yet another deep playoff run.

Washington second baseman Daniel Murphy matched Dodgers third baseman Justin Turner at .322 to share third in the NL batting race and the Nationals also a formidable starting rotation of pitchers paced by right-handers Max Scherzer, 16-6 with a 2.51 ERA and 268 strikeouts, and Stephen Strasburg, 15-4 with a 2.52 ERA and 204 strikeouts.

Toss in lefty Gio Gonzalez, 15-9 with a 2.96 ERA, and Washington fans are dreaming of the US capitol’s first World Series berth since 1933 and first crown since 1924.

That includes two Washington clubs that relocated, becoming Minnesota and Texas, and 33 seasons with no team before the Montreal Expos moved to Washington for the 2005 campaign — a franchise that has not played in a World Series in its 48-year history. — AFP

Business group leads campaign to prop up Iloilo’s image

THE ILOILO Economic and Development Foundation, Inc. (ILED) is leading a campaign to prop up the image of the province and the city amid reports of prevalent illegal drug trading and to reaffirm the image of Iloilo following the tagging of the province and the city in the illegal drug trade. At the launch of the public relations campaign dubbed “Proud to be Ilonggo,” ILED Chairman Narzalina Z. Lim said they aim to counteract the bad publicity. “Let’s just go ahead and show the world that it’s business as usual in Iloilo. You know we are so busy with so many events. And we still have to continue bringing the investments in,” she said before an audience of members of the business community, professionals, civil society, youth, academe, women, religious groups, and the media. The launching of the campaign will be followed by the creation of a Facebook account where they will post statistics on the peace and order situation in Iloilo as reported by Chief Superintendent Cesar Hawthorne R. Binag, the regional police chief. Ms. Lim also said that despite the series of tirades of President Rodrigo R. Duterte linking some Iloilo officials to the illegal drug trade, the business climate remains vibrant. “Recent events have put in Iloilo in the spotlight that unfortunately threatened to derail the progress that has been made. As peace-loving as we Ilonggos are, we must ensure that we do what we can to stay on track.” — Louine Hope U. Conserva

Bowl sells for Chinese porcelain record $37.7M – Sotheby’s

HONG KONG – A 1,000-year-old bowl from China’s Song Dynasty sold at auction for $37.7 million on Tuesday, breaking the record for Chinese porcelain, auction house Sotheby’s said.

The small piece – which dates from 960-1127 – broke the previous record of $36.05 million set in 2014 for a Ming Dynasty wine cup which was sold to a Shanghai tycoon.

Bidding started at around $10.2 million and the auction lasted for 20 minutes before the winning offer came from a phone bidder.

The bowl – originally designed to wash brushes – is an example of extremely rare Chinese porcelain from the imperial court of the Northern Song Dynasty and one of only four pieces in private hands, according to Sotheby’s.

Measuring 13 cm. in diameter, the dish features a luminous blue glaze.

The sale broke the “world auction record for any Chinese ceramics,” the auction house announced after the bidding.

It exceeded an earlier record made by a tiny white porcelain cup, decorated with a color painting of a rooster and a hen tending to their chicks, created during the reign of the Chenghua Emperor between 1465 and 1487.

The cup sold in 2014 to taxi-driver-turned-financier Liu Yiqian, one of China’s wealthiest people and among a new class of Chinese super-rich scouring the globe for artwork. – AFP

MRC Allied completes deal for stake in solar farm

MRC ALLIED, Inc. on Tuesday completed its acquisition of a 15% stake in a solar farm in Leyte for $5 million, marking its shift to the energy business.

The former property company told the stock exchange it had signed and executed a deed of assignment with Amled International Systems, Inc., one of the owners of Sulu Electric Power and Light (Phils.), Inc. (Sepalco).

Sepalco owns a 50-megawatt (MW) solar project in Barangay Castilla in Palo, Leyte province. It started operating in March 2016. The plant is connected to the grid via a 69-kilovolt transmission line.

MRC Allied bought 157.5 million shares in Sepalco at P1 each for a total of P157.5 million. Before the deal, Amled holds 45% of Sepalco, while SAS Sunrise Pte Ltd. owns 40%. The rest are held by three individuals.

The listed company said it will source the funds for the acquisition from shareholders’ advances.

MRC Allied President Gladys N. Nalda previously said the company was targeting to put up 1,000 MW of renewable energy capacity by 2022. For this year, the company has 160 MW of solar capacity in the pipeline — 100 MW in Clark Green City, Pampanga and 60 MW in Naga City, Cebu.

On Tuesday, shares in MRC Allied rose 5.8% to P0.365 each. — Victor V. Saulon

Weapons cache uncovered at Las Vegas shooter’s house

LAS VEGAS — Authorities said Monday they had recovered a weapons cache including firearms, explosives and ammunition from a house owned by Las Vegas gunman Stephen Paddock, as they upped the death toll from the attack to 59.

Sheriff Joseph Lombardo said officers searching the house in Mesquite, Nevada recovered “in excess of 18 additional firearms, some explosives and several thousand rounds of ammo, along with some electronic devices we’re evaluating at this point.”

Mr. Lombardo said the death toll from the Sunday night assault on an open-air concert on the Vegas Strip had risen to 59, while 527 people had been injured.

He said law enforcement were working four separate crime scenes: Paddock’s room at the Mandalay Bay hotel, the concert venue, the gunman’s house in Mesquite, and another house he owns in northern Nevada which a SWAT team was poised to raid.

The arsenal uncovered in Mesquite comes on top of at least 16 firearms discovered in the Vegas hotel room, from which Paddock launched the deadly assault before killing himself.

Mr. Lombardo said investigators had discovered several pounds of an explosive called tannerite in the Mesquite home, as well as ammonia nitrate, a type of fertilizer, in the gunman’s car.

Asked if they had discovered anything to bolster the claim of responsibility by the Islamic State group, Lombardo replied:

“Good for them — no, we have no evidence of that.”

‘RAT-A-TAT’
The gunman who fired on Las Vegas concertgoers from more than 1,000 feet away on Sunday may have used fully automatic weapons — or guns legally modified to act like them — that allowed him to spray bullets into the crowd of 22,000 people.

A US law enforcement official, speaking on condition of anonymity, told Reuters authorities, believed 64-year-old Paddock had at least two of such weapons when he fired from his 32nd floor hotel room, killing at least 59 people and injuring more than 500.

The rat-a-tat sound of the Las Vegas shooter’s gunfire prompted police at the scene to report the gunman was using an “automatic” weapon — a term often used to describe a fully automatic gun that can fire as many rounds as its magazine, drum or belt holds by pulling and holding the trigger.

Those weapons have been largely outlawed for three decades, though Paddock could also have used legal or illegal means to alter semi-automatic rifles, which fire a round every time the trigger is pulled.

“From the audio, that is not someone who has a traditional semi-automatic rifle firing it in its normal condition,” said David Chipman, a former Bureau of Alcohol, Tobacco, Firearms and Explosives agent who advises the gun control group Americans for Responsible Solutions. “Either it’s a machine gun or it’s been modified. I don’t believe a human can do that with his finger.”

Police said they recovered a total of 42 weapons belonging to Paddock, including 23 from the hotel room and 19 at his home in Mesquite, a small desert town about an hour from Las Vegas. Some were automatic weapons or semi-automatic rifles illegally modified into fully-automatic weapons.

It was not clear when or how Paddock obtained the guns. Chris Sullivan, owner of the Guns & Guitars shop near Paddock’s home in Mesquite, Nevada, confirmed Paddock had legally purchased firearms from the store but did not offer more detail.

The shooting has prompted renewed calls from Democrats for tighter gun laws, though it is unlikely the Republican-controlled Congress will take up such measures.

In 1986, Congress barred civilians from buying or selling fully automatic weapons made after that date, though individuals can legally possess older weapons after passing a background check and obtaining a special permit.

There are about 176,000 pre-1986 machine guns registered with the US government that can be legally transferred, and they typically cost tens of thousands of dollars.

But there are also less expensive legal products that can allow semi-automatic rifles such as the AR-15, which are much more widely available, to fire hundreds of rounds per minute.

A “bump stock,” for example, replaces a semi-automatic rifle’s stock, which rests against the shoulder to provide stability and absorb recoil.

The bump stock causes the gun’s recoil to press against the shooter’s finger after each shot, firing rounds much more quickly than possible by pulling it manually.

The website for one such product, Slide Fire, shows several videos in which shooters launch multiple rounds per second in bursts that sound almost indistinguishable from automatic fire. Reviewers have reported that the product permits a shooter to go through hundreds of rounds every minute.

The company did not return requests for comment.

‘SOUPED-UP SEMI?’
Such devices are not outlawed because the trigger is still pulled for each round, even though the rate is faster than possible using only one’s finger.

“There’s very little difference between a souped-up semi automatic and a fully automatic,” said Mike McLively, a policy expert with Americans for Responsible Solutions.

Paddock could also have illegally converted semi-automatic rifles into fully automatic guns, a process made easier by the presence of guides uploaded to the internet.

Nevada law lets residents own machine guns, if they are permitted under federal law. The state does not require licenses, registration or a waiting period for firearms, including semi-automatic rifles.

Shares in gunmakers American Outdoor Brands and Sturm, Ruger & Co rose 3.21% and 3.48%, respectively, on Monday. Gun stocks often spike following mass shootings on fears of stricter gun control. — AFP and Reuters

Shock value

JAPANESE automotive parts company KYB, known for shock absorbers, has added the New SR Special to its product lineup in the Philippines. The newly introduced shock absorber promises to retain the comfortable ride of stock vehicles even as it improves the damping characteristics of their suspension systems, according to Massiveparts, Inc., KYB distributor in the Philippines.

The company explained the New SR Special, which can replace shock absorbers fitted to vehicles when these leave the factory, has different viscosity levels that are 50% heavier on the compression/bumping stroke and 80% heavier on the rebound/extension stroke when compared against standard shock absorbers. This, Massiveparts said, lead to better handling qualities that do not compromise ride quality in the process.

“The New SR Special shock absorber fits most sedans, hatchbacks, SUVs and tuned cars made by brands like Subaru, Toyota, Mitsubishi, Honda, Ford and Suzuki,” said Gen Leong, marketing manager at Massiveparts. “It is perfect for those who would like to upgrade their daily drive.”

The Philippines and The Trans-Pacific Partnership (TPP)

Immediately after taking his seat in the White House, President Donald Trump signed a presidential memorandum to formally withdraw US participation from the Trans-Pacific Partnership (TPP). In a statement released last Jan. 23, President Trump said he is not supporting the TPP as it will only “undermine the US economy and its independence.” As an alternative, the American Chief Executive introduced alternative strategies which he claims will “put America first and bring jobs back to American shores.”

The TPP was originally planned as the most comprehensive free trade agreement between 12 nations that border the Pacific Ocean. It included Australia, Brunei, Canada, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, the United States, and Vietnam.

With the America’s withdrawal from the trading bloc, many thought that the TPP was dead in the water. Recently, however, the remaining member countries announced that TPP will push through with or without US participation. It is a clear sign of America’s decreasing importance in world trade.

The eleven remaining members have a collective GDP of $9.963 trillion, big enough to challenge the economies of China and India. It further boast of 470 million affluent consumers.

The TPP deliberately leaves out China and India since its ultimate objective is to balance the dominance of these two superpowers in international trade. TPP is designed to give other economies a fair chance to secure their fair share of global exports.

At the heart of the TPP is the commitment of each member country to lower trade barriers on 18,000 products, including contentious agricultural crops. In as far as non-trade barriers are concerned, TPP mandates each of its members to install express customs clearing mechanisms for importations coming from fellow-TPP members. It further prohibits them from levying duties for online transactions.

All these make it easier and cheaper to trade among TPP members. They become each other’s preferred trading partners, in effect.

When fully implemented, inter-trade among TPP economies is seem to increase by $146 billion a year. Along with boost in trade comes job creation, enhanced innovation, increased productivity, competitiveness and greater prosperity for all.

Those excluded in TPP, like the Philippines, are seen to lose out on this windfall of economic gains.

NON-TRADE ADVANTAGES OF TPP MEMBERSHIP
Apart from the economic benefits of TPP membership, member countries are also compelled to comply with the basic tenets of good governance.

For one, TPP members are required to join the United Nations Convention Against Corruption (UNCAC). Participation in UNCAC necessitates strict compliance with its anti-corruption code of conduct including the criminalization of government officials involved in bribery and conflicts of interest.

TPP also mandates its members to adhere to strict human rights standards. As such, it imposes stiff consequences for those who utilize child labor and practice discrimination in the workplace.

As far as intellectual property is concerned, members are obliged to adapt advanced policies to guard against of copyright, trademarks, and patent infringements.

Member countries are further committed to establish an “investor-state dispute settlement mechanism.” This gives foreign investors the right to sue its host country for treaty violations. It is meant to provide investors with basic protection from discrimination, uncompensated expropriation of property, denial of justice, and right to transfer capital.

All requisites considered, membership in TPP accelerates nations to become responsible, progressive, and aggressive exporters within the framework of good governance. It is a win-win situation.

PHILIPPINES PARTICIPATION
Although the Philippines was keen to join the TPP even during its conceptualization in 2005, it was not invited (nor considered) to join the group due to the prohibitive provisions of our Constitution relating to foreign investments.

See, embedded in our constitution are protectionist statues that go against the very tenets of a liberalized trading bloc. In particular, the 1987 constitution prevents foreign investors from owning majority stake in businesses relating to agriculture, fisheries, public utilities, education, private practice, and media, among others. On top of this, foreign ownership of land is prohibited.

Exclusion from TPP will be disastrous for our export industries on two counts.

First, since our key trading partners — Japan, Singapore and Canada, are signatory countries of TPP, not being part of the bloc weakens our competitive position in these markets. Second, the Philippines exports practically the same products as Vietnam and Malaysia. These include semiconductors, electronic products, food and beverages, furniture, garments, chemicals, auto and aerospace parts. Not being part of TPP puts Filipino-made products at a price disadvantage considering the duty-free privilege enjoyed by Vietnam and Malaysia. Duties can range anywhere from 2% to 100%, depending on product category.

The 10-point economic agenda of the Duterte administration calls for the amendment of the Constitutional restrictions that relate to foreign investments. While economic Charter change has yet to be earnestly deliberated upon in Congress, many are optimistic that it will come to pass. This should remove the obstacle to our inclusion in TPP.

Last week, DTI Secretary, Mon Lopez announced that he is reviving our application into TPP. It is doing so with the help of Japan, a strong member of the trading bloc, which is endorsing our application.

The initiative was applauded by local business groups as well as foreign chambers of commerce. Not only will our participation in TPP preserve our existing export markets, it will allow the Philippines to gain a stronger foothold in global trade, a scenario that will benefit Filipino manufacturers, traders and consumers alike. More importantly, inclusion in TPP prevents existing manufacturers based in the Philippines from moving to Vietnam.

The Philippines is currently a signatory to ASEAN, APEC, the World Trade Organization and the East Asian Community Trading bloc. Unfortunately, none of these treaties carry the same weight and scope of benefits as the TPP. For the Philippines to remain competitive and for it to sustain is upward trajectory in economic development, membership in TPP is fundamental.

We applaud Sec. Lopez for being forward thinking and taking this initiative.

 

Andrew J. Masigan is an economist.

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