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DPWH vetting C3 elevated expressway proposal

DEPARTMENT of Public Works and Highways (DPWH) Secretary Mark A. Villar said the agency is studying the unsolicited proposal of AC Infrastructure Holdings Corp. and SM Investments Corporations (SMIC) to build a C3 Elevated Expressway (C3EX) Project.

Mark-Villar
DPWH Secretary Mark Villar (3rd from left) and MPTC President Rodrigo Franco lead the laying of the time capsule during the groundbreaking ceremony of the R10 Section of the NLEx Harbor Link Segment 10. — WWW.MNTC.COM

“There might be some technical [issues]…We’re still reviewing,” Mr. Villar told reporters yesterday on the sidelines of the groundbreaking ceremony of the R-10 section of the North Luzon Expressway (NLEx) Harbor Link Segment 10.

“We’re still studying the effects on our existing projects… there might be some conflicts in alignment,” Mr. Villar said.

“We have our own C3 project going to Makati. We’ll see, [the proposal] is at an early stage, Mr. Villar added.

Mr. Villar also said that the conglomerates still have to submit some requirements related to their proposal.

Ayala-controlled AC Infrastructure and SMIC submitted in March an unsolicited proposal for the financing, design, construction and operations and maintenance of the C3EX.

The project is expected to serve over 50,000 vehicles per day upon completion of construction to relieve congestion in Circumferential Roads 2 (Quirino Ave.) and 4 (Epifanio de los Santos Ave. [EDSA]).

The unsolicited project, to cost an estimated P23.7 billion,  will cover about 8.6 kilometers. It will start from near Skyway Stage 3 in Sta. Mesa, Manila, cross the San Juan and Pasig Rivers through Sta. Ana district within the Circuit development area, and then proceed to the northern end of the Makati central business district before heading west to Diokno Boulevard in Pasay City. — Patrizia Paola C. Marcelo

Japan, US conduct live-fire drill amid regional tension over Pyongyang

ENIWA — Some 300 Japanese and US military personnel on Wednesday carried out live-fire artillery training in northern Japan, officials said, amid high regional tensions over North Korean missile threats.

The drill, part of a 19-day exercise, came after a tense war of words between the United States and North Korea over Pyongyang’s threats to fire missiles towards the Pacific island of Guam.

Troops from Japan’s Ground Self-Defense Force (GSDF) and US Marines fired live ammunition from armed vehicles at a maneuver area on the northern island of Hokkaido.

The two forces began the Northern Viper 2017 exercise on August 10, involving a total of 1,300 GSDF troops and 2,000 Marines.

“It is the first joint exercise between the GSDF and US Marines in Hokkaido,” a defense ministry spokesman said.

The spokesman denied any link between the drill and recent regional tension over North Korea.

“This is not conducted with a particular country or region in mind,” he said.

North Korean leader Kim Jong-Un said Tuesday he would hold off on a plan to fire four ballistic missiles towards Guam, a US Pacific island territory.

The threat had come after US President Donald J. Trump warned Pyongyang of “fire and fury” over intercontinental ballistic missile development.

Japan has deployed the Patriot Advanced Capability-3 (PAC-3) missile defense system in Shimane, Hiroshima and Kochi prefectures in western Japan, which North Korea had warned could be along its missiles’ flight path.

It also deployed the system in nearby Ehime prefecture.

Meanwhile, the defense ministry said US Osprey tilt-rotor aircraft will join the Northern Viper drills starting on Friday despite growing concerns after a fatal crash off Australia earlier this month.

The MV-22 — a hybrid helicopter-turboprop — has two engines positioned on fixed wingtips that allow it to land and take off vertically.

The aircraft, which can travel much faster than a helicopter, has been involved in a series of deadly incidents, mostly in the United States. — AFP

Complaining can be a habit

The world can be divided between those who complain about everything and those who have to listen to them. (Can you pass the toothpick, please?) Run-of-the-mill gripers torment only those close to them like spouses and significant others who eventually get used to whining as a form of small talk. Patient listeners (yes, Hon) retain the ability to take their French fries, while being verbally overpowered by their chatty partner. Perhaps, they tune out and listen instead to the barking of the neighbor’s dog while maintaining a respectful silence.

Whiners soon get tired of their regular audience and try out blogs and tweets using big fonts, and all caps if they feel like screaming. They have negative opinions on most things, like politics, garbage disposal, traffic, and the impending tax reform. (I like sugared drinks.) Note that economic topics may require charts and a knowledgeable audience, so this last category is usually dropped for more pedestrian fare like 35 passbooks with a small bank, discovered while looking for torn stockings that need attention — the universe does not mend stockings.

While seemingly detailed with analysis and criticism on what ails society, bellyachers seldom offer workable solutions — exile them all to a leper colony. They point out that it is not their job to solve problems. Other people are paid to right the wrongs. Their task is just to wrong the rights.

For whatever motives they have, some gripers can achieve a high profile and may be appointed to powerful positions as a result. But seldom do they succeed in fixing things that they loudly complained about. There’s always a conspiracy wanting them to fail. Solving problems anyway takes perseverance and patience which complainers by their nature are not equipped with.

Because of the griper’s concern for the littlest problem in the community like parking cars on the street (why don’t they provide garages for their cars?) or the proliferation of street peddlers when traffic is at a standstill, the complainant assumes the unlikely role of a champion against the powerful, who are of course defending the status quo. This crusading role is parlayed into a regular advocacy whose sole intent is to look for what’s wrong and bash people’s heads against the wall with it.

In the daily hunt for life’s potholes, the critic’s view of the world becomes warped. It is populated by the unprincipled, the corrupt, and the venal. It has no room for sincerity and goodwill, the virtuous monopoly of the griper.

Gripers can be ordinary people one meets socially who have a view on everything under discussion and express this in a loud and angry speech that does not brook any interruption. It is one’s misfortune at a wedding, cocktails for an organization’s anniversary, or a wake, to be thrown in with strangers. Because of unfamiliarity with certain characters in such events, one does not naturally steer clear of whiners, already well-known in their own social circles and on the lookout for new victims.

No complaint is too petty (fast food meals are served cold) or jejune (offices should allow working from home). It’s now just too easy to have a blog (although now you have to be registered and screened for improper thoughts, whatever that means) or get into a radio chat program, or television talk show, even only as a resource person. (We have with us the foremost authority on money laundering.) This invited resource does not limit himself to his declared area of expertise, even when this acquired knowledge itself is doubtful. (I just read up on the subject this morning.)

Being unhappy and vocal about things can be a full-time occupation. Psychologists acknowledge its healing power: isn’t venting a form of catharsis? One needs only to be looking out for any misdemeanor, wrong behavior, anomaly, and impropriety encountered in the course of the day. Like an examination of conscience, griping needs to be second nature, a pharisaic habit that invokes divine guidance — Lord, make me vigilant over the imperfections of others, including this lump beside me.

It is perhaps a heavy sin in a past life to be reincarnated into a dog whose owner is a whiner. The attempt to flee the diatribe is held back by a leash… even while being walked in the park.

A. R. Samson is chair and CEO of Touch DDB.

ar.samson@yahoo.com

Sweet Canadian victory

WHO WOULD have thought that one of Europe’s most well-kept wine secrets, the ice wine (also written as one word, icewine), would also be Canada’s biggest contribution to the world of wine?

Canada's-Icewine-081717
THE AUTHOR in Inniskillin winery, Niagara Peninsula, Ontario, Canada.

It was in the late 1700s that the process of making ice wine was accidentally discovered in Franconia, Germany. It was then that the idea of pressing juice out of frozen grapes arose. At the height of winter, with temperatures dropping below -10° C, grapes are frozen on the vine, with the inside pulp showing extremely high sugar concentration. The natural water portion of the juice turns into ice crystals, and only the rich pulp of the grape is extracted to be made into this luscious wine. With ice wines, the freezing happens in the vineyard before fermentation, not in the winery. The process is extremely different from that of other sweet dessert-like wines like French Sauternes or Hungarian Tokaji, as ice wine grapes are not influenced by the noble rot (Botrytis Cinerea).

Limited commercial production and release of ice wine (in German “Eiswein”) started in the mid to late 1800s, at Rheingau, Southwestern Germany.

Almost a century later, in 1978, Canadian Walter Hainle through his Hainle Vineyards made the first commercially available Canadian ice wine in Okanagan, British Columbia (BC). In 2002, the Hainle Vineyards were bought by the Huber family. While Okanagan is known as the original home of ice wine in Canada, the Niagara Peninsula in Ontario is actually the largest area producer of ice wine (accounting for 75% of total ice wine production in Canada). Also, Canada produces the most ice wines in the world and is a far bigger producer than second placed Germany. Due to Canada’s freezing winters, ice wines are grown in all of the country’s wine growing areas, from Ontario and British Columbia, to Quebec and Nova Scotia. Ice wines are also made in European countries such as Austria, Croatia, the Czech Republic, Denmark, Georgia, Hungary, Luxembourg, Poland, Romania, Slovakia, Slovenia, Sweden, and Switzerland – but in really miniscule quantities.

LIQUID GOLD
Ice wine is known as liquid gold because of the very expensive price tag on normally a half size bottle of 375 ml. The price may range in retail from $40/bottle to as much as five times more. To realize how precious this type of wine is and to justify its sinful price tag, one has to first understand that there is high mortality of grapes in winter – roughly only 10% of the grapes remain attached to their vines at the height of ice wine harvest season. In addition, the pulp that is used in ice wine fermentation is around 60% of the total juice of the grape, making actual harvest extremely small, and a resulting wine that is only 5-6% of original volume.

In Canada, ice wine wine-making process must follow regulations set by the Vintners Quality Alliance (VQA) – this is roughly equivalent to the Appellation Origen Controlee (or AOC) classification in France. With Canadian ice wine, the rules are extremely strict. At the height of winter, the grapes for ice wine are handpicked in their frozen stage. The frozen grapes are then immediately pressed. The frozen water crystals in the juice are then segregated from the concentrated pulp. And the concentrated pulp is then used for slow fermentation covering several months. No artificial freezing is allowed. The final wine is one of a golden hue, with luscious sweetness, good viscosity, and unbelievable depth.

Typical grapes used in Canadian ice wines are riesling, vidal, and, for a pink or red version, cabernet franc. Other grapes also used for ice wines, but to a lesser degree, are pinot gris and chardonnay. While riesling is the most popular varietal for German eiswein, vidal is the grape most identified with Canadian ice wine. The vidal varietal is a hybrid crossed from the French ugni blanc grape (the same grape used for Cognac in France) and another grape, seibel. The vidal varietal was named after its original breeder, Frenchman Jean Louis Vidal.

In 1991, after just a little over 12 years of commercial production, Canadian ice wine got its biggest recognition when the Inniskillin 1989 Niagara Peninsula Ice Wine won the most coveted and highest bestowed title of Le Grand Prix d’Honneur at the Bordeaux Vinexpo Fair in France – considered the world’s best wine fair and judged by distinguished international panel of wine experts.

So, maybe next time in any intelligent discussion on the best wine producing countries, perhaps a mention of Canada will not be scoffed at. After all, we all like sweets, and what other wine can you pair with a delectable cheesecake or scrumptious tiramisu than Canadian liquid gold?

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

Landbank net income up in 1st half

STATE-OWNED Land Bank of the Philippines (Landbank) saw its bottom line rise in the first half of the year, surpassing its mid-year projections, with the lender bullish on hitting its year-end net income target.

In a statement e-mailed to reporters on Wednesday, Landbank reported its net profit reached P7.43 billion in the first six months, climbing by 3% from the P7.2 billion recorded in the same period a year ago.

Last semester’s figure was also 8% above its from its mid-year income target of P6.88 billion, which the bank said puts it on track to meet its end-2017 earnings guidance of P13.75 billion.

“We are confident about meeting our full-year target of P13.75 billion, as income from loans and investments remain strong,” Landbank President and Chief Executive Officer Alex V. Buenaventura said.

Landbank’s revenues from loans jumped 7% year-on-year after its lending book expanded to P587.1 billion in the first half of the year, 20% higher than the P490.6 billion recorded in the comparable period a year ago.

Meanwhile, its income from investments likewise rose 9% to P9.2 billion in the first six months from P8.4 billion in the same period in 2016. This translated to return on equity of 14.55% at end-June, while its net interest margin was at 3.03%.

The government-owned bank’s net assets posted a double-digit increase of 15% to P1.5 trillion in the January to June period from P1.3 trillion in the first half of the previous year.

Total deposits also climbed by 17% to P1.32 trillion in the six months ended June from  P1.13 trillion last year. Its total capital reached P97.4 billion, up 9% year-on-year.

The bank is planning to put up 10 new branches this year situated across the country to bring the bank’s network to almost 400 offices nationwide.

Landbank said the new offices will help boost its lending business and deposit base. — Janine Marie D. Soliman

How technology may be getting out of control

By Mark Buchanan
Bloomberg

HUMANITY has a method for trying to prevent new technologies from getting out of hand: explore the possible negative consequences, involving all parties affected, and come to some agreement on ways to mitigate them. New research, though, suggests that the accelerating pace of change could soon render this approach ineffective.

People use laws, social norms and international agreements to reap the benefits of technology while minimizing undesirable things like environmental damage. In aiming to find such rules of behavior, we often take inspiration from what game theorists call a Nash equilibrium, named after the mathematician and economist John Nash. In game theory, a Nash equilibrium is a set of strategies that, once discovered by a set of players, provides a stable fixed point at which no one has an incentive to depart from their current strategy.

To reach such an equilibrium, the players need to understand the consequences of their own and others’ potential actions. During the Cold War, for example, peace among nuclear powers depended on the understanding the any attack would ensure everyone’s destruction. Similarly, from local regulations to international law, negotiations can be seen as a gradual exploration of all possible moves to find a stable framework of rules acceptable to everyone, and giving no one an incentive to cheat — because doing so would leave them worse off.

But what if technology becomes so complex and starts evolving so rapidly that humans can’t imagine the consequences of some new action? This is the question that a pair of scientists — Dimitri Kusnezov of the National Nuclear Security Administration and Wendell Jones, recently retired from Sandia National Labs — explore in a recent paper. Their unsettling conclusion: The concept of strategic equilibrium as an organizing principle may be nearly obsolete.

Kusnezov and Jones derive insight from recent mathematical studies of games with many players and many possible choices of action. One basic finding is a sharp division into two types, stable and unstable. Below a certain level of complexity, the Nash equilibrium is useful in describing the likely outcomes. Beyond that lies a chaotic zone where players never manage to find stable and reliable strategies, but cope only by perpetually shifting their behaviors in a highly irregular way. What happens is essentially random and unpredictable.

The authors argue that emerging technologies — especially computing, software and biotechnology such as gene editing — are much more likely to fall into the unstable category. In these areas, disruptions are becoming bigger and more frequent as costs fall and sharing platforms enable open innovation. Hence, such technologies will evolve faster than regulatory frameworks — at least as traditionally conceived — can respond.

What can we do? Kusnezov and Jones don’t have an easy answer. One clear implication is that it’s probably a mistake to copy techniques used for the more slowly evolving and less widely available technologies of the past. This is often the default approach, as illustrated by proposals to regulate gene editing techniques. Such efforts are probably doomed in a world where technologies develop thanks to the parallel efforts of a global population with diverse aims and interests. Perhaps future regulation will itself have to rely on emerging technologies, as some are already exploring for finance.

We may be approaching a profound moment in history, when the guiding idea of strategic equilibrium on which we’ve relied for 75 years will run up against its limits. If so, regulation will become an entirely different game.

This article does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.

Peso slips ahead of GDP report

THE PESO ended almost flat versus the dollar on Wednesday but still logged another near 11-year low due to domestic corporate demand and ahead of the release of local economic growth data and minutes of the US Federal Reserve’s latest meeting.

The peso closed at P51.35 against the dollar yesterday, nearly unchanged from Tuesday’s finish of P51.34-to-the-dollar. Still, it was the local unit’s weakest close in almost 11 years or since it ended at P51.38 a dollar on Aug. 25, 2006.

The peso opened the session at P50.45 against the dollar. Its best showing was at P50.30, while its weakest intraday level was at P51.60 versus the greenback.

Trading volume was at $824.7 million, higher from the $659 million that changed hands in the previous session.

Traders attributed the peso’s performance to strong dollar demand from corporates, with investors also on a wait-and-see mode for local gross domestic product (GDP) data and the Federal Open Market Committee (FOMC) minutes.

The trader also noted they saw the Bangko Sentral ng Pilipinas (BSP) step in during the morning session.

“The movement was generally higher mainly because of higher US retail sales but the profit taking was capped because of investors waiting for GDP data and FOMC minutes,” another trader said.

Official second-quarter GDP data will be released today by the Philippine Statistics Authority, while the Fed’s July meeting minutes was scheduled for release overnight.

“Both reports might be an event and will dictate what the exchange rate will be,” the other trader said.

For today, both traders said the exchange rate could settle within P51.20 to P51.60 range.

CYCLICAL TREND
BSP officials on Wednesday downplayed perceived weakness in the peso-dollar exchange rate, noting that currency movements simply follow a cyclical trend at a time of rising imports and changing market conditions.

“There is justifiable reason for the peso to be where it is right now,” Assistant Governor Johnny Noe E. Ravalo said in a media briefing yesterday at the BSP headquarters in Manila.

“Experience tells us that it is rather a good thing to let the peso move so that it reflects the changing market conditions, the demand and supply.”

However, the BSP official said such figures should also be viewed in the context of “changing” market dynamics.

“The BSP does not target a particular exchange rate number, so there is no magical number beyond which there is a panic button either upwards or downwards,” Mr. Ravalo added. He clarified that the exchange rate adjustments have become “consistent” with the country’s robust economic growth story and price movements, which makes it a lesser cause of concern for the monetary authority.

At the Senate, BSP Governor Nestor A. Espenilla, Jr. stressed that the depreciation of the peso “reflects market concerns” on the country’s current account deficit, and as the currency normalizes after previously gaining strength.

“However, it should be emphasized that the current account position signals the country’s higher propensity to import as the country gears up for higher growth momentum,” Mr. Espenilla told members of the Senate Committee on Finance during a briefing on the P3.767-trillion national budget for 2018.

The Philippines posted a $318-million current account deficit during the first quarter, equivalent to 0.4% of gross domestic product. This compares to a $600-million deficit expected by the central bank for the full year, and shows a turnaround from the $601-million surplus posted in 2016.

Mr. Ravalo added that the pass-through impact of the peso in terms of headline inflation has gone down to 0.14% for every P1, versus a share of 0.48% before the BSP adopted an inflation targeting framework in 2002.

Should the exchange rate see extreme swings, the BSP is ready to intervene by selling units in order to calm the volatility by using the country’s hefty reserve stash to be an active player and rate influencer. — Melissa Luz T. Lopez and Janine Marie D. Soliman

How PSEi member stocks performed — August 16, 2017

Here’s a quick glance at how PSEi stocks fared on Wednesday, August 16, 2017.

PSEi_081717

Employment of PWDs

Republic Act (RA) No. 10524, An Act Expanding the Positions Reserved for PWDs, amending for the purpose RA No.7277 (Magna Carta for Persons with Disability) in April 2013, expanded employment opportunities for PWDs. Its Implementing Rules and Regulations (IRR) were published on Aug. 15, 2016, the full text of which the Bureau of Internal Revenue (BIR) circulated through Revenue Memorandum Circular No. 48-2017 dated 30 June 2017.

WHO ARE PERSONS WITH DISABILITY?
Under RA 10524, Persons with Disability (PWDs) refer to individuals who suffer long-term physical, mental, intellectual or sensory impairments which, upon interaction with various barriers, may hinder their full and effective participation in society on an equal basis with others.

The seven types of disabilities mentioned in RA No. 7277 are psychosocial disability, disability due to chronic illness, learning disability, mental disability, visual disability, orthopedic disability, and communication disability. They are defined in Department of Health A.O. No.2009-0011 as follows:

Psychosocial Disability — any acquired behavioral, cognitive, emotional, social impairment that limits one or more activities necessary for effective interpersonal transactions and other civilizing process or activities for daily living, such as but not limited to deviancy or anti-social behavior.

Chronic Illness — a group of health conditions that last a long time. It may get slowly worse over time or may become permanent or it may lead to death. It may cause permanent change to the body and it will certainly affect the person’s quality of life.

Learning Disability — any disorder in one or more of the basic psychological processes (perception, comprehension, thinking, etc.) involved in understanding or in using spoken or written language.

Mental Disability — disability resulting from organic brain syndrome (i.e., mental retardation, acquired lesions of the central nervous system, or dementia) and/or mental illness (psychotic or non-psychotic disorder).

Visual Disability — impairment of visual functioning even after treatment and/or standard refractive correction, with visual acuity in the better eye of less than 6/18 for low vision and 3/60 for blind, or a visual field of less than 10 degrees from the point of fixation. A certain level of visual impairment is defined as legal blindness. One is legally blind when the best corrected central visual acuity in the better eye is 6/60 or worse or side vision of 20 degrees or less in the better eye.

Orthopedic Disability — disability in the normal functioning of the joints, muscles or limbs.

Communication Disability — an impairment in the process of speech, language or hearing, further broken down into two types: (a) Hearing Impairment is a total or partial loss of hearing function which impede the communication process essential to language, educational, social and/or cultural interaction; and (b) Speech and Language Impairment means one or more speech/language disorders of voice, articulation, rhythm and/or the receptive or and expressive processes of language.

PWDs can further be classified as a Qualified Person with Disability, which includes an individual with disability who, with reasonable accommodations, can perform the essential functions of employment position that such individual holds or desires.

For accreditation purposes, PWDs with non-obvious disabilities such as psychosocial, learning, mental/intellectual, visual and hearing disabilities should secure a certification from the Department of Health through its regional hospitals, medical centers, and specialty hospitals attesting to the individual’s impairment.

As provided in the law, equal employment opportunity shall be given to PWDs in the selection process based on qualification standards for an appointment to a position in government and requirements set by employers in private corporations. They shall also be subject to the same terms and conditions of employment, compensation, privileges, benefits, incentives, or allowances as an able-bodied person.

EMPLOYMENT RATIO OF PWDS
Government agencies shall reserve at least 1% of their regular and non-regular positions for PWDs.

Private corporations, on the other hand, who employ at least 100 employees are encouraged to reserve at least 1% of all positions for PWDs. Those who employ less than 100 employees are encouraged to hire PWDs.

INCENTIVES FOR EMPLOYING PWDS
To promote active participation, private corporations that hire PWDs are entitled to the following incentives under the IRR:

1. 25% additional deduction from the private corporation’s gross income of the total amount paid as salaries and wages to PWDs.

To avail of this incentive, private corporations are required to present proof that they are employing PWDs who are accredited or registered with the Department of Labor and Employment and Department of Health as to their disability, skills, and qualifications.

2. Private entities that improve or modify their physical facilities in order to provide reasonable accommodation for PWDs shall be entitled to an additional deduction from their net income, equivalent to 50% of direct costs of the improvements or modifications.

Facility improvement under this incentive should be different from the requirement of Batas Pambansa (BP) Blg, 344 otherwise known as an Act to Enhance the Mobility of Disabled Persons by requiring certain buildings, institutions, establishments, and public utilities to install facilities and other devices. Under BP Blg. 344, buildings, institutions, establishments, and public utilities are required to install facilities and other devices to allow the mobility of disabled persons.

The IRR further provides that the conditions of hiring and employment of PWDs should be made with the welfare of PWDs in mind. This means that accommodation of PWDs should not impose undue or disproportionate burden, but must ensure the exercise of equal opportunity for PWDs in all fundamental rights. As may be practicable, a work schedule given to a PWD should be modified to favor the employee.

Installation of auxiliary aides and assistive devices in a work place should also be considered to ensure that PWDs are able to perform their assigned task with ease.

RA 10524 and its IRR aim to provide equal work opportunities to PWDs and at the same time incentivizing the private sector for its participation. More than the incentive, integrating PWDs in the work force means rehabilitation, self-development, self-reliance and affirmation of PWDs as productive members of society.

The views or opinions expressed in this article are solely those of the author and do not necessarily represent those of Isla Lipana & Co. The content is for general information purposes only, and should not be used as a substitute for specific advice.

Larissa C. DALISTAN-Levosada is a senior manager at the Tax Services Department of Isla Lipana & Co., the Philippine member firm of the PwC network.

+63 (2) 845-2728

larissa.c.dalistan@ph.pwc.com

Here’s what you need to know about a proposed law for innovative startups

The world is seeing an onslaught of young and promising entrepreneurs, whose success, in large part, is hinged on the revolution of tech.

Social media platform Facebook founded by Mark Zuckerberg in 2004, for example, is already among the largest companies in the world, holding a market cap of $407.3 billion as of May this year. Ride‑hailing platform Uber, online music streaming Spotify, and online marketplace and hospitality service platform Airbnb are also now considered to be Unicorns in the global market.

But building a startup up to that stature is no walk in the park. Beyond the financial struggles, introducing a new enterprise involves a horrendous process of complying with government requirements, not to mention the pressure brought by market validation and constant wooing with investors.

Filipino startups, particularly the tech‑related and innovative ones, may no longer have to struggle in entering the business jungle if Senate Bill No. 1532 or the Innovative Startup Act filed by Sen. Paolo Benigno “Bam” Aquino IV gets enacted.

The bill, filed last Aug. 1, aims to “develop the country’s startup ecosystem” and reduce the barriers to the success of innovative startups by providing development program, tax breaks, and financial and technical assistance.

Under the proposed law, an innovative startup is defined as an enterprise that has been operating for not more than five years and whose gross annual revenue is not over ₱50 million. It should also have a research and development (R&D) budget equivalent to 15% of its total operational cost or a patent or registered software owner.

Here’s what it will bring to the table:

AN ‘INNOVATIVE STARTUP DEVELOPMENT PROGRAM’

The program will support the R&D initiatives of innovative startups and support service providers, promote the participation of innovative startups in international startup events, and link startups to government agencies, academic institutions, or industry partners for product development support.

FREE, EXPEDITED PROCESSES

Free and expedited business permits and certificates processing.

GOVERNMENT AGENCIES’ SERVICES

Free use of equipment, facilities, and services of government agencies, including the Intellectual Property Office of the Philippines.

RESEARCH AND DEVELOPMENT GRANT

R&D grant from the Department of Science and Technology (DOST), Department of Trade and Industry (DTI) or Department of Information and Communications Technology (DICT).

TAX EXEMPTIONS

Exemption from paying income tax, Value Added Tax, creditable withholding tax on income, and expanded withholding tax on its income payment.

VENTURE FUND

Access to “Innovative Startup Venture Fund” worth ₱10 billion, to be administered by DOST.

FIVE‑YEAR VISA

Special visa with five‑year validity to be issued by the Bureau of Immigration.

AIRFARE AND ALLOWANCE FOR INTERNATIONAL TRIPS

Incentives such as free airfare and allowance for startups joining international events or competitions.

The proposed policy also tasks DICT to launch a website that will contain information about statistics, events, programs, and benefits for startups and related enterprises in the country.

In his sponsorship speech, Mr. Aquino, who leads the Senate Committee on Science and Technology, said there are more than 200,000 startups in the Philippines that have a potential to address the country’s problems and contribute to Filipinos’ lives.

He called on lawmakers to pass the bill to “empower our innovators and entrepreneurs with a heart for nation‑building.”

“Let us pass the Innovative Startup Act and encourage our innovative entrepreneurs to create solutions for our nation,” the senator urged.

A staunch advocate for micro‑entrepreneurship in the country, Mr. Aquino has previously pushed for laws dedicated to micro, small and medium enterprises, including the Go Negosyo Act and Youth Entrepreneurship Act.

What are your thoughts about the proposed Innovative Startup Act? Let us know in the comments and we might just include it in our next story.

Belgian town makes giant omelet

Members of the World Brotherhood of the Huge Omelet create a 6,500 egg omelet within a four meter diameter frying pan on August 15, 2017 in Malmedy, Belgium.
Ten thousand hen’s eggs will be used for the traditional event in the town near the German border despite a scandal sweeping Europe involving eggs tainted with the insecticide fipronil. AFP

omelet
AFP

 

Farm growth fuels Q2 GDP hopes

FARM OUTPUT last quarter turned around from a year-ago decline, growing faster than January-March’s expansion due to the past year’s low base, the Philippine Statistics Authority (PSA) reported on Tuesday ahead of its gross domestic product (GDP) report tomorrow.

PSA said value of agricultural production — which has historically contributed a 10th to GDP and a fourth to the country’s jobs — grew by 6.18% in the second quarter, faster than the preceding three months’ 5.28% pace and turning around from the 2.21% contraction recorded in April-June 2016.

The second quarter took the farm sector’s first-half growth to 5.71%, also a turnaround from the 3.39% contraction recorded in 2016’s first six months.

The Department of Agriculture had earlier given a five-percent growth estimate for second-quarter farm output growth.

Farm sector expansion is now expected to have added impetus to second-quarter GDP growth — which Socioeconomic Planning Secretary Ernesto M. Pernia has estimated to approach seven percent — together with bigger state spending, continued recovery of merchandise exports and strong household consumption.

The crops subsector, which contributed 50.75% to total farm production value last quarter, grew by 11.72%, compared to a 4.98% year-ago drop.

In terms of volume, palay — which contributed about 17.55% to total value of farm output — grew 11.72% annually to 4.15 million metric tons (MT), while corn — which contributed 4.31% — surged 45.97% to 1.33 million MT.

Farm growth fuels Q2 GDP hopes

 

Second-quarter performance made palay and corn output grow by 12.06% to 8.569 million MT and by 30.7% to 3.696 million MT, respectively, last semester.

In a separate July-round Rice and Corn Situation and Outlook report released also yesterday, the PSA said the fourth quarter may see a 3.58% hike in palay output to 7.263 million MT, making production this semester grow 6.76% year-on-year. Palay output is now projected to grow by 9.058% to 19.224 million MT this year from 2016’s 17.627 million MT.

The PSA gave third- and fourth-quarter projections for corn output: a 1.23% dip to 2.63 million MT and 2.04% drop to 1.693 million MT, respectively. Corn output is now expected to fall by 1.55% this semester but still grow 11.08% for the full year. The PSA blamed projected contraction this semester on “frequent rainfall during growth stages” of the grain and “farmers’ apprehension of the peace-and-order situation in the Autonomous Region in Muslim Mindanao”.

Last quarter also saw value of production of fisheries (16.84% of the total), livestock (16.38%) and poultry (16.02%) drop 2.93% and 1.38%, as well as increase by 8.36%, respectively.

Sought for his own projection of farm output performance this semester, Rolando T. Dy, executive director of the University of Asia and the Pacific’s Center for Food and Agri-Business, said in a mobile phone message yesterday that growth will likely slow “to a maximum of four percent”, still building on last year’s low base as the sector recovered from an earlier prolonged El Niño-induced dry spell. — Janina C. Lim

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