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Q3 ends with ‘subdued’ factory growth

By Elijah Joseph C. Tubayan
Reporter

THE PHILIPPINES last month managed to land second place in Southeast Asia behind Vietnam in terms of growth of manufacturing activity, but the improvement was its second weakest since its inclusion in January last year in the survey IHS Markit conducts for Nikkei, Inc.

Q3 ends with ‘subdued’ factory growth

The seasonally adjusted Nikkei Philippines Manufacturing Purchasing Managers’ Index (PMI) picked up to 50.8 in September from August’s record-low 50.6, ending the quarter on a “subdued” note.

“Subdued growth of the Philippines manufacturing economy persisted at the end of the third quarter, as output expansion slowed further,” the report read.

“Order book gains continued to underwhelm relative to the historical trend — even as exports returned to growth — which weighed on hiring.”

The manufacturing PMI consists of five sub-indices, with new orders having the biggest weight at 30%, followed by output (25%), employment (20%), suppliers’ delivery times (15%) and stocks of purchases (10%).

Readings above 50 denote expansion while those below that mark point to contraction.

Compared to its peers in the Association of Southeast Asian Nations (ASEAN), the Philippines jumped over Indonesia and Singapore to land second as the performance of those other two countries worsened from August. Indonesia and Singapore saw their readings slip to 50.4 and 48.6, respectively, from 50.7 and 51.0 in the past two months.

The headline Nikkei ASEAN Manufacturing Purchasing Managers’ Index itself eased to 50.3 in September from August’s 50.4.

“The Philippines’ manufacturing economy ended the third quarter on a weak note, with the PMI signalling a second consecutive month of subdued growth,” the report quoted IHS Markit Principal Economist Bernard Aw as saying.

“The survey data pointed to further slowing in output growth and a modest sales trend while employment shrank again as firms indicated sufficient manpower to meet production demand,” he added.

“Despite the decrease in payroll numbers, capacity continues to be in abundance, which would weigh on hiring in the near future.”

The report noted that “September data showed that output volumes rose at the weakest rate since the survey started in January 2016,” blaming “a softening sales trend,” reduced overtime work, input shortages and rising cost of raw materials.

After declining in August, export orders increased last month even as “the degree of expansion was the mildest since the survey started in January last year.”

“The weak peso continued to pose a problem for manufacturers,” Mr. Aw added, referring to the peso’s persistent weakness against the greenback.

The local currency has depreciated 2.7% year-to-date to P51.08 to the dollar as of yesterday, surpassing the P48- to P50-to-the-dollar rate state economic managers have assumed for 2017.

“Not only did the cheaper currency fail to provide a boost to exports, it raised the cost of imports,” the report read.

“Coupled with supply shortages due to bad weather, costs for manufacturing inputs, especially in industrial metal and paper, increased further. There were also reports of rising cost inflation affecting production levels.”

The Bangko Sentral ng Pilipinas (BSP) on Friday last week estimated that inflation likely clocked 2.8-3.6% in September from August’s 3.1%, while BusinessWorld’s poll of 13 economists yielded a 3.2% median.

Production input costs rose at their fastest pace in five months, the report read.

Guian Angelo S. Dumalagan, Land Bank of the Philippines market economist, noted that “[o]ne thing surprising about the report though is that exports provided minimal boost to the overall manufacturing sector, despite depreciation of the peso and the general improvement in economic conditions abroad.”

“In part, this might be attributed to the fact that many of our exports are just re-shipments of imported products, which have become more expensive in local currency terms due to the peso’s weakening,” he said in an e-mail yesterday.

Ruben Carlo O. Asuncion, chief economist at Union Bank of the Philippines, said in an e-mail that the Philippine index’s “increase, though marginal, may signal an eventual recovery comparable to growth in 2016 with increasing domestic demand due to the fast approaching holiday season.”

“I still expect Philippine manufacturing to grow in 2017, especially as more and more investments are anticipated from the government’s thrust of increasing infrastructure spending plus the impact of further tax reform when corporate taxes are eventually adjusted to be comparable regionally,” added Mr. Asuncion.

Survey data showed that a majority of respondents expected production to increase in the next 12 months on the back of new product launches, an improving economic climate, marketing activity and business expansion.

“[O]ptimism regarding output remained high, encouraging firms to increase purchases of inputs,” Mr. Aw said.

Gov’t wants to open retail trade further

THE GOVERNMENT is moving to open up the country’s retail sector further to foreign brands by reducing the paid-up capital threshold for enterprises to be reserved exclusively for Filipinos.

Socioeconomic Planning Secretary Ernesto M. Pernia told reporters yesterday that economic managers are looking to reduce the paid-up capital threshold to just $200,000 from the prevailing $2.5 million under Republic Act No. 8762, or the Retail Trade Liberalization Act of 2000.

Rule III Section 1 of RA 8762 provides that “[e]nterprises with paid-up capital of the equivalent in Philippine pesos of less than US$2,500,000 shall be reserved exclusively for Filipino citizens and corporations wholly owned by Filipino citizens.”

“We’ll make them more competitive and they will be forced to be internationally competitive. The purpose is to make consumers happier,” Mr. Pernia told reporters on the sidelines of an event in Mandaluyong City.

“It used to be $2.5 million. We are using $200,000.”

Sought for comment, European Chamber of Commerce of the Philippines (ECCP) President Guenter Taus replied in an e-mail: “ECCP feels very positive about the potential reduction of the paid-in capital requirement for the entry of foreign retailers in the Philippines.”

“Let us not forget that this requirement is one of the major causes of the low level of foreign direct investments in the country,” Mr. Taus said.

“If the paid-in capital requirement is eliminated or reduced, the competitiveness of the Philippines will surely increase, thus favouring foreign investments,” he added.

“It goes without saying that the elimination of barriers to market access for foreign retailers will have a positive spill-over effect on the economy, stimulating economic growth, creating more jobs, increasing competition, providing Filipino consumers with better choices and higher quality goods at lower prices.”

John D. Forbes, senior adviser of the American Chamber of Commerce of the Philippines, noted separately that “[t]he limit in the 2000 law was set too high and has resulted in few investments over 17 years.”

“It makes sense to reduce to the same minimum capital requirement of other domestic enterprises in the Foreign Investment Act (of 1991, or RA 7042),” Mr. Forbes said in a mobile phone message.

The government is also reviewing the draft 11th Foreign Investment Negative List to free up industries for foreign ownership without having to go through time-consuming legislation.

Mr. Pernia said the National Economic and Development Authority (NEDA) Board — chaired by President Rodrigo R. Duterte — will review the FINL “[h]opefully in our next NEDA Board meeting.”

“We haven’t yet set a date, but there would definitely be one before the end of the year,” said Mr. Pernia, who had earlier cited professions, public utilities and foreign contracting for government projects as other fields to be opened to foreign participation. — Elijah Joseph C. Tubayan

Not resting on his laurels

The Entrepreneur Of The Year Philippines 2017 has concluded its search for the country’s most inspiring entrepreneurs. Entrepreneur Of The Year Philippines is a program of the SGV Foundation, Inc., with the participation of co-presenters Department of Trade and Industry, the Philippine Business for Social Progress, and the Philippine Stock Exchange. In the next few weeks, BusinessWorld will feature each finalist for the Entrepreneur Of The Year Philippines 2017.

The Entrepreneur Of The Year Philippines 2017

Dr. Peter Laurel
President
Lyceum of the Philippines
University — Laguna and Batangas Campus

LYCEUM of the Philippines University (LPU) has always been committed to providing quality education and developing leaders, lifelong learners and globally competitive professionals.

Dr. Peter Laurel, 60, has continued this vision. From a small provincial school, LPU has become the first private, non-sectarian, autonomous university in the country.

Mr. Laurel was asked by his family to help out with LPU, the school founded by his grandfather, former Philippine President Jose P. Laurel, in Intramuros, Manila.

After the success of the Manila campus, his father set up the Batangas branch in 1966, followed by the Laguna campus in 2000 and Cavite campus in 2008. Mr. Laurel presently runs the Batangas and Laguna campuses.

“The vision that has been propelling all of us is that you don’t need to go to Manila to get a good education,“ he explains.

“So right where you are — like Batangas and Laguna — you can have an education that is as good as, if not better, than what you can get from many of the Manila schools.”

Mr. Laurel states that his grandfather was very focused on nationalism.

“There’s a saying here ‘No one can love the Filipino more than Filipinos themselves’,” he said.

As a distinct part of the curriculum, LPU runs courses on Jose P. Laurel’s teachings, including values and philosophy.

According to Mr. Laurel, the people of LPU is one their biggest strengths.

They focus on training and mentorship to put their people in the position to succeed.

Most of the members of the LPU Management Committee are homegrown and they are the ones who are most dedicated to the growth of the universities.

“The spirit of oneness is the moving force behind our success,” he explains.

LPU follows a system of meritocracy.

As a general rule, even family members have to meet certain requirements, such as graduate degrees, before they are allowed to join the business. This helps them professionalize the school and maintain a high level of competence and quality in its management team.

Innovation is one of the factors that drives LPU’s strategic direction.

FOCUS ON RELEVANCE
Mr. Laurel says that all program offerings should be relevant and responsive to the needs of future students.

Three years ago, his team set up a high school in preparation for the K-12 program and established a culinary institute and offer several TESDA courses.

LPU not only provides regular academic offerings, but also education for maritime professionals, lifestyle and short courses, as well as English language proficiency training for foreign students.

LPU will be opening a College of Medicine and College of Optometry, the first in Batangas.

LPU also houses the College of Allied Medical Professions, College of Business Administration, College of Computer Studies, College Of Criminal Justice, College of Dentistry, College of Education, Arts and Sciences, College of Engineering, College of International Tourism and Hospitality Management, and the College of Nursing.

LPU’s next objective is to internationalize the school and be recognized in the Asia-Pacific region.

LPU is the first Private Non-Sectarian University to achieve a QS (rating system) three-star rating.

Mr. Laurel also initiated LPU’s internationalization by forging partnerships with academic institutions and companies worldwide. An example of this is its hospitality school, which is co-operated with the Dusit Thani Group.

Online classes is the next challenge LPU will take on.

“We expect that, over time, there will be less people in our classrooms,” expresses Dr. Laurel.

“So right now we’re developing our management systems. In the next three years 30-50% of the courses must be online through the Learning Management System platform.”

EXPANSION
For the next few years, LPU will be focusing on expansion. It plans to open campuses in the Clark Freeport and Special Economic Zone and in Davao City.

Mr. Laurel also spoke of other Bayleaf Hotels, run by LPU, in Batangas, Davao and Laguna, to complement its hospitality and tourism programs.

The Commission on Higher Education has awarded LPU Batangas the Center of Excellence for Hotel and Restaurant Management, Tourism and Medical Technology and Center of Development for Business Administration and Information Technology.

It is the first university in the Philippines to be granted full international accreditation for Hotel and Restaurant Management and Tourism by the International Centre of Excellence in Tourism and Hospitality Education.

It was also the first university in Asia to be certified Gold by the Investors in People, a British international standard for human resource training and development.

Mr. Laurel, a recipient of a Go Negosyo award, believes that persistence is what got Lyceum of the Philippines University to where it is today.

“Success is in the small steps one takes every day,” he tells aspiring entrepreneurs, “not the giant leap.”

“I think perseverance in taking those small steps is what counts in the long run.”

The official airline of the Entrepreneur of the Year Philippines 2017 is Philippine Airlines. Media sponsors are BusinessWorld and the ABS-CBN News Channel. Banquet sponsors are Bench; Bounty Fresh Food, Inc.; CDO Foodsphere; Fiori Di Marghi; Global Ferronickel Holdings, Inc.; Hyundai Asia Resources, Inc.; Intermed Marketing Phils., Inc.; Jollibee Foods Corp.; LBC; SteelAsia and Universal Harvester, Inc.

The winners of the Entrepreneur Of The Year Philippines 2017 will be announced in an Oct. 18 awards banquet at the Makati Shangri-La Hotel. The Entrepreneur Of The Year Philippines will represent the country in the World Entrepreneur Of The Year 2018 in Monte Carlo, Monaco in June 2018. The Entrepreneur Of The Year program is produced globally by Ernst & Young.

 

ERRATUM
In the Sept. 29 The Entrepreneur Of The Year Philippines 2017 article, titled: “Pushing boundaries,” HCS Management Corp. President and Chief Executive Officer Charles Streegan’s furniture company should have been identified as Pacific Traders & Manufacturing Corp., which is under HCS, a holding company. The article may be found at http://www.bworldonline.com/pushing-boundaries/.

UnionBank to issue $1B under MTN program

By Melissa Luz T. Lopez, Senior Reporter

UNIONBANK of the Philippines, Inc. (UnionBank) will soon foray into the global market by issuing foreign currency debt papers, as part of its fresh fund-raising exercise to support the bank’s debt management and lending activities.

In a disclosure, the listed lender announced that it will be issuing as much as $1 billion under a euro medium-term note (MTN) program.

A medium-term debt program stands as a flexible facility for corporates to issue notes in the foreign currency in the global capital markets, allowing them to tap a bigger avenue for their fund-raising activities. These debt papers are offered on a continuing basis until such a time when the ceiling amount is reached.

A euro MTN means the borrowings will be issued abroad except in the United States and Canada, and may be offered in a wide range of currencies apart from the greenback.

Apart from this offering, UnionBank will raise another P20 billion by offering long-term negotiable certificates of deposit (LTNCDs) locally.

These debt instruments are similar to regular time deposits which offer higher interest rates, but the difference is that these cannot be pre-terminated. Being “negotiable” means that these can be traded at the secondary market prior to maturity date.

UnionBank President and Chief Operating Officer Edwin R. Bautista said the new borrowing platforms would beef up the bank’s portfolio that will allow them to hand out bigger loans, particularly to finance big-ticket infrastructure projects.

“We have one year to issue the LTNCD. Proceeds will help lengthen our funding maturity profile and allow us to meet our customers need for longer tenor loans,” Mr. Bautista said in a text message.

“This will allow us to extend more term loans to clients with infrastructure projects.”

Earlier this year, Mr. Bautista bared plans to put up a foreign currency-denominated investment product through its new partnership with the Swiss-owned wealth and asset manager Lombard Odier.

The Aboitiz-led lender reported a P2.15-billion net income during the second quarter, which was 6.85% lower than the P2.31 billion recorded a year ago and from the P2.21 billion seen during the first three months of the year.

Earnings totalled P4.4 billion during the first six months, which jumped by 11% from the P3.9 billion booked during the same year-ago period amid steady increases in the bank’s core businesses.

Total assets held by the bank stood at P553 billion as of end-June, the bank previously reported. Total loans reached P265 billion, while deposits also climbed to P434 billion.

UnionBank shares closed at P86.55 each yesterday, down 10 centavos or 0.12% from P86.65 apiece on Friday.

Philippines AirAsia pushes IPO back to mid-2018

By Patrizia Paola C. Marcelo

ILOILO CITY — Philippines AirAsia, Inc. is looking to conduct its initial public offering (IPO) by mid-2018.

“BDO’s working on it, hopefully by the middle of next year, we’ll be able to get it,” Philippines AirAsia Chief Executive Officer Dexter M. Comendador told reporters on Sunday, referring to BDO Capital and Investments Corp. which has been tapped as underwriter for the deal.

Mr. Comendador said the company expects to raise up to $250 million from the public offering, which will be used mainly to expand its facilities.

“We need hangars, we need a new office building,” he said, adding the new office of Philippines AirAsia would be located most likely in Clark, Pampanga.

AirAsia Group Chief Executive Officer Tony Fernandes earlier said the planned IPO of the Philippine and Indonesian units is part of a plan to consolidate its Southeast Asian units under one listed holding company.

“Our first step is to list Philippines and Indonesia for my One AirAsia plan, where we have all the AirAsia units go public. Malaysia and Thailand are public. Not sure which one will come first, Philippines or Indonesia, but both are going to go public very soon,” Mr. Fernandes  said at the sidelines of the International Paris Air Show in June.

Under the One AirAsia plan, Mr. Fernandes said he wants to form an ASEAN (Association of Southeast Asian Nations) community airline by combining its units in Malaysia, Thailand, Philippines and Indonesia under a single holding company. The move is expected to yield economies of scale and help AirAsia establish a dominant position in markets where it operates.

NEW FLIGHTS
On Sunday, AirAsia launched the maiden flight of its Manila-Iloilo route. The low-cost carrier will service the route with three flights daily using its fleet of Airbus A320s that can accommodate up to 180 passengers.

At the same time, AirAsia is also planning to launch new flights from Manila to Indonesia in the first quarter of 2018.

Mr. Comendador told reporters AirAsia will launch direct flights from Manila to Bali and Jakarta by January and February.

The budget carrier will also mount direct flights from Manila to Ho Chi Minh City in Vietnam starting November.

In May, the AirAsia Group reported that the Philippine unit posted an operating profit of P400 million in the first quarter of 2017, attributed to a rise in passenger count by 19% and surge in revenues by 41%.

ALI asks SC to reverse ruling on Las Piñas property

AYALA LAND Inc. (ALI) has asked the Supreme Court (SC) to reconsider its decision nullifying the property giant’s ownership of around 46 hectares of land in Las Piñas City.

In a disclosure to the stock exchange on Monday, ALI said it filed its motion for reconsideration with the SC on Sept. 28.

The SC had granted rightful ownership of the land, located inside Ayala Southvale Subdivision, to petitioners Yu Hwa Ping and Mary Gaw, as well as the heirs of Andres Diaz and Josefa Mia.

The High Court noted irregularities in the process of land registration, citing that the land surveys used for its registration less than 90 years ago were invalid and should in turn be nullified in order to protect the public and the Torrens system.

However, ALI said before it acquired the property in 1998, it had conducted an investigation of the titles.

“(ALI) had no notice of any title or claim that was superior to the titles purchased by ALI. ALI believes its titles are superior to the claims of these adverse claimants,” it noted.

ALI said its motion for reconsideration stressed that its Original Certificates of Titles (OCTs) can be traced back prior to the OCTs of the claimants’ title, specifically in 1950 and 1958, as opposed to the OCTs of claimants which were issued in 1970.

The property developer also noted that predecessors of claimants had initially opposed ALI’s application for the original land registration, but then lost in favor of ALI’s predecessors.

ALI added that its purchase of the properties were made after an examination of its derivative titles, “thereby making ALI an innocent purchaser for value.” 

The disputed land forms part of the company’s total land bank of 9,852 hectares. With the property making up less than 1% of this figure, ALI said the procedures will not have any material effect on its business, operations, and financial conditions. 

ALI booked an 18% increase in its net income for the January to June period to P9.7 billion. The company enjoyed solid sales reports from its residential brands for the period, contributing to an 18% rise in consolidated revenues to P64.5 billion.

Shares in ALI dropped 10 centavos or 0.23% to P43.40 each at the Philippine Stock Exchange on Monday. — Arra B. Francia

Fed eyes rates as asset-price tool in subtle strategy shift

FEDERAL RESERVE policy makers are embarking on a subtle shift in strategy with potentially big implications for investors: using interest rates as a tool to contain the knock-on effects of lofty stock and asset prices on financial stability and the economy.

The sharpened focus on asset values evident in Fed officials’ public and private remarks suggests the central bank will be more inclined to raise interest rates than otherwise, even if inflation is low. It also means that financial markets can no longer expect – in the words of Allianz SE chief economic adviser Mohamed El-Erian – the Fed to be their BFF, or best friend forever, providing them with unstinting support.

“The financial stability argument for tightening is getting more weight,” said Jonathan Wright, an economics professor at Johns Hopkins University in Baltimore and a former Fed economist.

Led by former chairman Alan Greenspan, central bankers had long argued that they were ill-equipped to spot bubbles in the making and the best approach to tackling them was to let them burst and clean up the mess afterwards. But behind the latest shift is a recognition by officials that the last two recessions were at least partly prompted by declines in markets that had gotten too frothy – technology stock prices in 2001 and housing in 2007.

Fed Chair Janet Yellen hinted at the change last week in laying out her argument for further, gradual interest-rate increases.

Not only does “persistently easy monetary policy” raise the risk of an overheated economy, it “might also eventually lead to increased leverage and other developments, with adverse implications for financial stability,” she said in a speech in Cleveland.

Fed research has shown that such buildups in leverage often occur when risk-taking in markets is elevated – as central bank staffers deem is the case now.

New York Fed President William Dudley, a close ally of Yellen’s, has been more explicit in tying policy to market developments, though his focus has been on their impact on the economy, not financial stability.

Even with three rate hikes since December, stock prices have risen by more than 10% and the dollar has fallen by about 8%, contributing to an easing in financial conditions that’s helped spur growth. Dudley has repeatedly argued that strengthens the case for pressing ahead with rate increases to keep the economy in balance.

Policy makers have penciled in one more rate hike for 2017 and three more for 2018, according to the median projection in forecasts released last month.

There are dangers to the Fed’s approach. With inflation at 1.4% in August, continuing to raise rates would risk cementing expectations that price gains will stay permanently below the central bank’s 2% target.

Officials generally agree that the first line of defense against financial instability is so-called macro-prudential tools, such as changes in bank capital requirements or warnings to lenders about risky practices. Monetary policy is to be kept in reserve, only used to, in economists’ parlance, “lean against the wind” to avert imbalances when other measures haven’t worked.

EXCESS CREDIT
With only four rate hikes in the past 22 months, the Fed is far from leaning against the wind with a tight monetary stance. Instead, as flagged by Yellen, it risks fanning excess credit creation by keeping policy easy.

Together with a taut labor market, some policy makers see that as a reason to return policy to a neutral setting that neither spurs nor inhibits economic growth. Yellen has suggested that such a stance would be consistent with a federal funds rate around 2%, above the bank’s current 1% to 1.25% target range.

“Elevated stock prices contribute to easy financial conditions and as such may accelerate the convergence of the funds rate to neutral, but won’t push the funds rate above that,” said former Fed official Roberto Perli, now a partner at consultant Cornerstone Macro LLC.

Of course, there’s no guarantee that Yellen will be around next year to gradually hike rates. Her four-year term atop the Fed expires on Feb. 3, and while President Donald Trump has said she could retain the job, he’s also looking at other candidates.

The emerging Fed strategy, though, does bear some resemblance to the approach advocated by the man that economists see as Yellen’s main rival – former Fed Governor Kevin Warsh. In a January presentation to the American Economic Association, the Hoover Institution fellow urged the central bank to stop trying to fine-tune inflation and instead focus more on developments in finance, money and credit.

Boston Fed President Eric Rosengren has been a leading voice in advocating that policy makers put more weight on asset prices. Speaking in New York last week, Rosengren said the Fed should raise rates in a “regular and gradual” way despite low inflation – to guard against risks that the economy will overheat, “raising the probability of higher asset prices” or inflation well above target.

It’s not just the hawkish central bankers who see potential financial risks ahead.

PRIMARY CONCERN
“In the last two episodes when unemployment reached very low levels, it was in fact financial imbalances that were the primary concern, rather than accelerating inflation,” Fed Governor Lael Brainard said Sept. 5.

While she’s argued that macro-prudential measures should be the first response to such dangers, she’s also acknowledged that they’re “incomplete” – a point that departing Vice-Chairman Stanley Fischer also makes.

“A major concern of mine is that the US macro-prudential toolkit is not large and not yet battle tested,” he said in a speech last week.

To be sure, policy makers aren’t warning that a crisis is imminent. Indeed, Yellen has described the overall risks to financial stability as moderate.

But just as the Fed must anticipate the ups and the downs of the economy in running monetary policy, it also must be forward-looking when it comes to dealing with potential financial imbalances.

And in that regard, “elevated asset valuation pressures today may be indicative of rising vulnerabilities tomorrow,” Fischer said in June. — Bloomberg

Amaia pours P1.5 billion into Novaliches project

AYALA LAND, Inc.’s economic housing unit has invested P1.5 billion to develop townhouses, mid-rise condominium buildings, and a shophouse district on a 20-hectare property in Novaliches.

“Our project is actually located in the heart of Novaliches. This is about 5 kilometers away from (SM Fairview). We have our thriving neighborhood… All of these are integrated into one community,” Ayla Reyes, Amaia Land Corp. Associate for Project Development, said in a press briefing in Quezon City on Monday.

Amaia Nova Estate is a mixed-use community composed of Amaia Square Nova, Amaia Steps and Amaia Series.

The P150-million Amaia Square Nova features 41 shophouses in either two- or three-storey units with the general rule that the ground floor for each unit will be allotted for retail space. Owners have the option to turn the second and third floors into retail spaces or as a residential area.

Launched in 2014, the company is now turning over Amaia Square units to buyers. A two-storey unit with 69 square meters (sq.m.) of space is priced at P5.9 million each, while a three-storey unit with floor space of 89.1 sq.m. is sold for P6.9 million.

“What we want to do here is they no longer have the desire to need to go as far as SM Fairview or Fairview Terraces by having within themselves Amaia Square Nova… We realized that our project was not located in a prime location. So what we decided to do is prime up the location and make their lives easier and more convenient for them by putting the shophouse,” Ms. Reyes said.

Ms. Reyes noted that the demand for shophouses is coming from well-established business owners in the Novaliches area, investors who want to lease out the unit, as well as entrepreneurs who want to take advantage of the growing community.

Amaia has already completed over 300 units for Sector 1 of Amaia Series, its townhouse development in the estate. Of this, Amaia has already turned over 100 houses. This forms part of the six out of 10 hectares Amaia has developed under the brand. Once completed, Amaia will have a total of 836 townhouse units.

“With the high take-up rate of Amaia Series, we’ve already launched Sector 2 last December of 2016, and we’re preparing the launch of Sector 3 within the year,” Ms. Reyes said.

Four buildings for Amaia Steps, which is the company’s first mid-rise condominium building, is now ready for occupancy, with more than 280 households already residing in the development. Its amenities include a clubhouse with two function rooms, a basketball court, playground, and swimming pool. Over 2,500 residents are expected to reside inside Amaia Steps. — Arra B. Francia

Poll flags doubts on drug war; cops seek CBCP help

AMID THE increasing controversy over President Rodrigo R. Duterte’s drug war, some law enforcers have turned to the Catholic Church to seek help and “have expressed their desire to come out in the open about their participation in extrajudicial killings and summary executions,” according to a statement by the Archbishop of Lingayen-Dagupan on Monday, Oct. 2.

Meanwhile, the latest results, released on Monday, from the June 23-26 Social Weather Stations (SWS) survey indicate that three out of five Filipinos agree that only poor drug pushers are killed, while three out of four say Mr. Duterte should divulge his list of drug personalities and charge them in court.

‘SANCTUARY’
“Law enforcers have come forward confidentially to us, their spiritual leaders, to seek sanctuary, succor and protection,” Archbishop Socrates B. Villegas said in the statement published in the Web site of the Catholic Bishops Conference of the Philippines (CBCP). “Their consciences are troubling them,” he added.

“We will look prudently into the security of their motives and the veracity of their stories. Within the bounds of Church and civil laws, we express our willingness to grant them accommodation, shelter, and protection (including their families if necessary),” the Archbishop added.

“If such law enforcers wish to testify, then the Catholic Church will see to it they are in no way induced to speak, to disclose nor to make allegations by any member of the clergy of the hierarchy. Statement, especially in the form of affidavits and depositions, must be made with the assistance of competent independent counsel,” Archbishop Villegas said, adding that, “If their preference is to stay with us in the Church, they will not be turned over to the State under its own witness-protection program.”

He also admonished “our priests…to refrain from discussing with “asylum-seekers” the contents of their testimonies and depositions. It is furthermore recommended that volunteer lawyers, preferably those who belong to alternative law groups, assist the witness and also readily affirm that no member of the clergy instructed, directed, and couched the testimonies they give.”

“But when they so decide or opt to identify themselves and to testify, every means must be provided for a fair, accurate and unconstrained or unrestrained testimony that may be used in evidence,” the statement also read.

RICH AND POOR
The latest results of the SWS survey also found that 60% agreed (33% strongly agree, 27% somewhat agree) with the statement: “Hindi pinapatay ang mga mayayaman na drug pusher; ang mga pinapatay ay ang mahihirap lamang [Rich drug pushers are not killed; only the poor ones are killed].”

Twenty-three percent disagreed (12% somewhat disagree, 11% strongly disagree) and 17% were undecided.

The highest proportion of those who agreed that only poor drug pushers were killed came from Metro Manila, with 75% (48% strongly agree, 27% somewhat agree) agreeing.

This is followed by Mindanao with 59% agreeing (34% strongly agree, 25% somewhat agree), Balance Luzon with 58% (29% strongly agree, 30% somewhat agree, correctly rounded), and the Visayas with 53% (31% strongly agree, 22% somewhat agree).

Three out of four said Mr. Duterte should expose his list of drug personalities and charge them in court. 74% agreed (46% strongly agree, 28% somewhat agree) with the statement: “Dapat isiwalat ni Pang. Duterte ang kanyang listahan ng mga taong sangkot sa droga o ‘drug personalities’ sa publiko at sampahan ng kaso sa korte ang mga nakalista. [Pres. Duterte should expose his list of drug personalities to the public and charge those in the list in court],” while 12% disagreed (7% somewhat disagree, 5% strongly disagree) and 14% were undecided.

Meanwhile, opinions were split about the truthfulness of police claim of “nanlaban” — that the suspects killed in the anti-illegal drugs campaign really resisted arrest: 25% said the police are telling the truth, 28% said the police are not telling the truth, and the plurality of 48% were unsure whether the police are telling the truth or not.

TAXI DRIVER’S CLAIM
Meanwhile, in the Senate’s continuing inquiry into the phenomenon of extrajudicial killings (EJKs), taxi driver Tomas Bagcal presented himself for the first time before the Senate committee on public order and dangerous drugs.

According to Mr. Bagcal, Mr. Arnaiz and another teen, presumably 14-year-old Reynaldo de Guzman, hailed and boarded his cab in Pasig City at around 12:30 to 1:00 a.m. of Aug. 18 and asked to be taken to 5th Avenue in Caloocan City.

When they reached their destination, the older of the two announced a robbery. Mr. Arnaiz allegedly held a knife at Mr. Bagcal. But a tricycle driver who happened by managed to help him foil the robbery, and bring the suspects to a precinct in 9th Avenue, Mr. Bagcal said.

While the two were being whisked toward a cell, Mr. Bagcal said he was instructed to go to a room. This was where a certain “Raras Lakay” talked to him.

“At sinabi sa akin na itapon na lang ito sabay senyas na gigilitan ng leeg yung dalawang holdaper pero sinabi ko pa rin na itu-turnover po sir sa inyo itong dalawang holdaper,” he told the committee. (I was told that they were going to be thrown away while he made a sign that they would be killed but I told them that I was just turning them over.)

“Dahil sa takot at kaba ko sa sinabing itapon yung mga holdaper, naisip ko na puwede din akong isabay sa mga holdaper na papatayin kasama ko, mga holdaper na i-prinesent ko sa kanila. Higit sa lahat kasi, hindi nila ako ini-logbook, hindi rin nila tinanong kung anong pangalan ko, at ano ang address ko, at ganoon din yung korporasyon ng taxi ko,” he added. (I was scared because of what he told me about getting rid of the robbers. I realized that I could also be killed together with the robbers I handed over. More than that, I was not registered in their log book, nor asked my name and address and the company of the taxicab I drove.)

The suspects were eventually escorted out for a ride in a police car with Mr. Bagcal as driver. He claimed that it was only Mr. Arnaiz who was told to get out, adding that he saw the boy down on his knees with both hands raised.

Mr. Bagcal said he had no idea what happened to the other boy.

When asked to identify the policemen who killed Mr. Arnaiz, Mr. Bagcal pointed at policemen PO1 Jefrey Perez and PO1 Ricky Arquilita. But the driver mistakenly identified PO3 Arnel Oares as Mr. Lakay.

According to another witness who went by the alias Joe Daniel, he was at about the same location — C3 near a gasoline station — when he witnessed Mr. Arnaiz’s killing. But this was between 1:28 and 2:00 a.m., going by Daniel’s account, and not 4:00 a.m., as stated by Mr. Bagcal.

In his sworn affidavit, Mr. Daniel said was looking for a place to eat when he saw the police car. Fearing the he would be apprehended, he hid behind a nearby post. It was there that he saw the policemen take Mr. Arnaiz out of the car and press him against the side of the car before shooting him. But according to Mr. Daniel, Mr. Arnaiz was on his knees and his hands were cuffed.

When the senators asked Messrs. Perez and Arquilita about their alleged involvement in the killing, both of them invoked their right against self-incrimination.

The DNA analysis on Mr. De Guzman’s body also remained a subject of controversy at the Senate hearing, with Public Attorney’s Office Chief Persida V. Rueda-Acosta maintaining that the body found in Gapan, Nueva Ecija, was Mr. Guzman’s, while the police said the DNA test didn’t match with his parents.

For his part, Senator Antonio F. Trillanes IV presented the affidavit of resigned policeman Vincent Masagna Tacorda of Catanduanes province, who said that in July 2016 he was “ordered” to personally “deliver an ‘accomplishment of 5 -10 deaths of drug personalities.’”

However, Philippine National Police (PNP) Director General Ronald M. dela Rosa said Mr. Tacorda had already recanted his allegations in an affidavit on June 29.

AGUIRRE, HONTIVEROS
Also on Monday’s inquiry, Justice Secretary Vitaliano N. Aguirre II figured in an argument with Senator Ana Theresia N. Hontiveros-Baraquel, on the heels of Mr. Aguirre’s filing criminal charges against the senator for alleged violation of Republic Act 4200 or the Anti-Wiretapping Law at the Pasay City Prosecutor’s Office that morning.

At the Senate, Mr. Aquirre called on the senator to present the individual identified as a journalist who had taken the photo, saying she had been in connivance with this person.

In response, Ms Hontiveros said Mr. Aguirre was not refuting the content of the text messages. — with Mario M. Banzon, Rosemarie A. Zamora and interaksyon.com

Peso weakens on Fed rate bets

THE PESO weakened versus the dollar on Monday, moving in sync with regional currencies as higher yields in the United States supported the currency amid continued bets of a December rate hike.

The local unit closed at P51.08 yesterday, tumbling by 26.5 centavos from the P50.815-per-dollar finish logged on Friday. This is the peso’s worst showing in two weeks or since the P51.10 rate logged on Sept. 18.

The peso traded weaker throughout the session as it opened at P50.90, which also happened to be its best showing that day. It hit P51.10 as its intraday low.

Two traders interviewed yesterday said the peso’s performance largely reacted to a continued dollar rally, which came despite mixed results of key economic data released recently.

“The peso depreciated [yesterday] despite weak US reports on personal spending and core PCE (personal consumption expenditures) inflation, due to expectations of some tax cuts in the US. Increased expectations of a rate hike this year also pushed the dollar higher,” one trader said.

US consumer spending – which accounts for more than two-thirds of the economy – rose by a mere 0.1% in August, reeling from the impact of Hurricane Harvey.

Despite this, market players still expect the US Federal Reserve to hike rates by December.

“The short-term trend is dollar strength for the past week or so. We are also seeing higher Treasury yields, which is also helping the dollar rally,” a second trader said.

Higher US Treasury yields helped bolster the greenback, as rates for 10-year papers rose to 2.36% in Asian trading compared to Friday’s US close of 2.326%, Reuters reported.

The second trader noted that the Bangko Sentral ng Pilipinas likely stepped in during trading to smoothen the sharp foreign exchange swing observed yesterday as the local currency moved nearly 30 centavos from Friday’s closing rate – a “very rare” occurrence.

Dollars traded on Monday reached $888 million, higher than the $740.3 million which exchanged hands on Friday. Traders said average daily volumes usually settled within $500-600 million.

For today, the first trader expects the peso to trade within P50.90 to P51.20, noting that the peso could move sideways or likely downward depending on the results of latest manufacturing data in the US. Hawkish statements from Dallas Fed President Robert S. Kaplan could offset the impact of weaker factory data, the trader added. On the other hand, the second trader expects a higher range within P51 to P51.20. — Melissa Luz T. Lopez

NDFP issues outline on social justice for talks with government

By Rosemarie A. Zamora

THE NATIONAL Democratic Front of the Philippines has released an executive summary of the draft of the Comprehensive Agreement on Social Economic Reforms (CASER), completed on Jan. 12, 2017.

The proposed draft aimed to tackle long-standing social justice issues of peasant landlessness and land monopolizations, among others.

In the draft, the NDFP called for real agrarian reform which can correct “historical injustices of the peasantry” by free distribution of lands as a “key to ending rural poverty and the starting point for rapid development of the Philippine countryside.”

“The proposals of the National Democratic Front of the Philippines (NDFP) for a Comprehensive Agreement on Social and Economic Reforms (CASER) are concrete and doable steps towards liberating the Filipino people from poverty, exploitation, and underdevelopment,” the summarized draft reads.

Other key reforms proposed by NDFP are:

• Breaking land monopolies through expropriation and with selective compensation; land should be distributed for free.

• Peasant cooperatives and associations should be set up and farmers should have democratic participation in decision making.

• Domination of key capitalists should be broken and utilities should be nationalized “to ensure electricity, water, telecommunications, and transport services for the people and overall development.”

• Environmental protection policy that restricts large-scale mining and marine wealth extraction. Foreign appropriation should be banned and should be exclusively for Filipinos with preference for collective ownership.

• Policies that protect children, OFWs, women, elderly, and persons with disabilities and upholding people’s rights to basic services by providing free education, healthcare, housing, water, energy, mass transport, and communications.

• Policies to strengthen Filipino culture and promotion of arts, music, literature that would also allow to support freedom of speech, information, and expression.

• Policies to support the indigenous peoples and the Bangsamoro’s rights to self-determination, economic development, and non-discrimination.

• Policy to develop a relatively independent and self-reliant economy such as the regulation of foreign trade and investment to ensure long-term contributions to national development and establishing better ties with East Asia countries.

Sought for comment, University of Santo Tomas professor Edmund S. Tayao said, “the proposal of the NDF are well-meaning. I have to say far-reaching and really very fundamental reforms” that could solve the “elitist social economic frame” of the country, wherein a “slanted” social structure is favoring the elites.

“If you’re going to look at the agenda of the current administration and the proposal of the CPP-NDF, you will notice some convergences in fact, apart from convergences you can see [that] there is some consistency or at the very least (there are) agreements between the priority measures of the administration and the CPP-NDF,” he said in a phone interview.

Also sought for comment, Executive Director of the Institute for Political and Electoral Reform (IPER) Ramon C. Casiple said in a text message that the proposal “reflects their own revolutionary framework” that would require constitutional changes.”

Mr. Tayao, for his part, also said: “[T]here’s no problem with the program priorities of the government and the reform advocacies of the CPP-NDF. In other words, if those were the only basis I’m sure that we could have had already assigned agreement between the two parties. But the problem is more with the people behind the negotiations.”

He then cited, as an example, attacks by the New People’s Army in the countryside despite ongoing peace talks with the government.

“So, in other words, parang ang lumalabas hindi natin alam (it appears we don’t know) if the CPP-NDF and the NPA are still led by one single leadership structure. So doon nagkaproblema (So there, we find problems), essentially,” he added.

The government suspended the fifth formal talk with communist rebels last May, citing continuous attacks by NPA.

“The way I understand the President and the government, they’re waiting for, you know some good faith on the part of the CPP-NDF. In other words, a clear indication that they are really sincere in negotiating,” Mr Tayao said.

Chief Justice, Ombudsman part of ouster plot? Duterte thinks so

PRESIDENT Rodrigo R. Duterte believes the Ombudsman and Chief Justice are being used by political forces to remove him from the presidency, his spokesman said on Monday, Oct. 2. Presidential Spokesperson Ernesto C. Abella said in a press briefing that even though Mr. Duterte respects the Ombudsman as an institution, he emphasized that certain practices of people inside the institution may be the reason why he refuses to submit himself to investigation.“The President believes the Supreme Court Justice and the Ombudsman have allowed themselves to be used by certain political forces to discredit him and his administration in order to spark public outrage and eventually oust him from the Presidency.”

“In other words, he finds them suspect. And it is his prerogative to ask them to resign. He respects the institution. However, the practices of certain people, (that) may be suspect,” Mr. Abella said.

On Saturday, Mr. Duterte dared Ombudsman Conchita Carpio-Morales and Chief Justice Ma. Lourdes P.A. Sereno to resign with him. He vowed anew not to submit himself to the Ombudsman’s investigation, repeating his accusation that the constitutional body has engaged in corrupt activities by accepting bribes from several law enforcers and lawmakers.

In a statement, Chief Presidential Legal Counsel Salvador S. Panelo said “the President is not threatening the Office of the Ombudsman or any of its officers. He is merely reprimanding the body for not following the appropriate procedure for investigation and strongly reminding it to strictly observe the process as mandated by law and its own internal rules.”

Mr. Panelo also said that it is just proper for Mr. Duterte “to refrain from submitting himself to the jurisdiction of the Office of the Ombudsman given that the procedure being undertaken by is flawed at the onset.”

Mr. Abella for his part said Mr. Duterte has documents to back his allegations against Ms. Sereno.

“I’m sure he does. He’s a lawyer. He knows he must speak out of substantial evidence,” Mr. Abella said. — Rosemarie A. Zamora

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