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Small-farmer insurance bill filed in Senate

JCOMP-FREEPIK

A BILL seeking to expand the coverage of the crop insurance program to include small farmers has been filed at the Senate.

The Philippines’ “vulnerability to disasters and (their) disastrous effect on agricultural productivity calls for a more permanent and long-term solution that will ensure that the agricultural sector, especially small farmers, are protected and given support to sustain their production,” Senator Joseph Victor G. Ejercito, author of Senate bill No. 390, said in a statement Monday.

The measure would require the DA to develop a comprehensive insurance scheme for small farmers in coordination with the Philippine Crop Insurance Corp. (PCIC) and the Insurance Commission (IC).

The bill calls for subsidized premiums for farmers tilling five hectares or less, Mr. Ejercito noted.

As of the afternoon of Oct. 30, the Department of Agriculture (DA) estimated agricultural damage caused by Severe Tropical Storm Paeng (international name: Nalgae) at P285.28 million affecting 8,608 farmers and fisherfolk.

Last month, Super Typhoo Karding (international name: Noru) inflicted P3.12 billion worth of crop damage, according to the DA.

“The government has provided subsidies to support the crop insurance program and has been shouldering shares of insurance premiums of insured farmers,” Mr. Ejercito said.

“However, this has not resulted in better outcomes in terms of alleviating the financial burden of farmers,” he added. — John Victor D. Ordonez

Meat industry says agri PPPs, more support for farmers to ensure food security

FREEPIK

By Justine Irish D. Tabile

AGRICULTURAL public-private partnerships (PPPs) and investing in farmers will help ensure food security and counter the trend of younger people being discouraged from taking up unrewarding careers in agriculture, a senior meat industry executive said.

“If we want food security, we have to make sure we have farmer security. Because if we do not plant our own, if we do not grow our own, crops, livestock etc., we will always have food insecurity,” North Star Meat Merchants, Inc. Chief Executive Officer Anthony Ng said in an interview with BusinessWorld.

According to Mr. Ng,  farmers don’t want to pass on their trade to their children because farming is difficult and not financially rewarding.

“I hope there will be a push to…entice our farmers to stay (and provide encouragement to) their sons and daughters,” Mr. Ng added.

The government can help by offering more PPPs in agriculture “in partnership with food companies” and fund the Department of Agriculture (DA) adequately.

“It’s really the synergy, the working together of the government and the private (sector) that will solve this … Private cannot just be completely reliant on government. Government cannot do it alone,” Mr. Ng added.

He added that the private sector “should do its job” by maximizing whatever policies the government comes up with to support agriculture.

Mr. Ng noted that there has been a push to give the DA an adequate budget to effect the recovery in the supply crop and livestock subsector.

Crops and livestock “have been severely hit” by natural disasters and the African Swine Fever (ASF) outbreak, “Kailangan lang talaga nila ituloy (The government just needs to follow through),” Mr. Ng said.

“There is no commercially available vaccine yet (for ASF). There have supposedly been trials in Vietnam together with a US company… until that comes into play, this situation will persist,” Mr. Ng said.

The poultry supply has also been affected by avian flu, raising the prospect of increased imports. Overall, inflation is also raising production costs, making farming less lucrative.

“Farmers are losing money; therefore, they are producing less,” he added.

ADB restructuring to streamline work with member-countries

BW FILE PHOTO

THE ASIAN Development Bank (ADB) said a “new operating model” will streamline the way it works with member-countries in order to achieve its goal of becoming the region’s main source of climate financing and development solutions.

“The new operating model will enable ADB to increase its capacity as the region’s climate bank; strengthen its work to develop the private sector and mobilize private investments in the region; provide a larger range of high-quality development solutions for its developing member countries; and modernize ways of working to make it more responsive, agile and closer to clients,” according to a press release.

Under the new model, ADB’s five regional departments and resident missions will become a single window for all ADB products and services.

“Staff and expertise from the sectors, themes, and other specializations in which ADB operates will be consolidated, with increased deployment to regions and countries to offer a better range and quality of solutions, resulting in more staff working in the field, closer to clients,” the bank added.

ADB President Masatsugu Asakawa said the restructuring will position the institution to “better respond to the complex development challenges now faced by Asia and the Pacific.”

“It builds on ADB’s core strength, our staff, to help us deliver solutions with the greatest development impact for the region,” he added.

The new operating model will be implemented by the second quarter of 2023. The ADB said it will phase in its rollout to minimize disruptions. — Luisa Maria Jacinta C. Jocson

2023 tax trends and ends: The sequel

In our earlier article “2022 Tax Trends and Ends,” I presented updates on taxation to provide taxpayers with the necessary tools to begin the year right. Exactly two months from now, taxpayers are once more expected to embrace new sets of tax rules that are bound to be implemented as we welcome the 2023.

The changes in the tax rules are a mix of good and bad news. Rules on lowering income tax rates and decreasing the number of VAT returns to be filed are good news. However, some reliefs offered by the Corporate Recovery and Tax Incentives for Enterprises (CREATE) Act are set to expire by the middle of 2023. Here are some of the changes that will take effect next year.

LOWERED GRADUATED INCOME TAX RATES
Individual taxpayers have something to look forward to in the coming year as income tax rates are set to be reduced. With the objective of rectifying deficiencies and promoting a simpler and more efficient tax system, the Tax Reform for Acceleration and Inclusion (TRAIN) Act, which took effect in 2018, introduced an amendment that decreased the tax rates for middle-income earners on a staggered basis. In 2023, individual taxpayers with annual taxable income amounting to P250,000 or below will continue to be exempted from paying income tax. Taxpayers affected by the further decrease in tax rates are those earning more than P250,000 but not over P8 million. They used to be subject to the graduated rates of 20% to 32%. Starting Jan. 1, 2023, they will be subject to lower income tax rates ranging from 15% to 30%. High-income earners who have taxable income in excess of P8 million will continue to be subjected to a 35% rate.

Note, however, that the present administration through the Department of Finance (DoF) has proposed changes in taxation. The proposals include the deferment of the reduction of the abovementioned income tax rates from 2023 to 2025. This proposal is still subject to ongoing discussion and approval.

QUARTERLY REPORTING OF VAT RETURNS
The TRAIN Act also introduced relief to VAT-registered persons from filing numerous tax returns within a taxable year. Beginning 2023, BIR Form No. 2550-M (Monthly Value-Added Tax Declaration) is no longer required to be filed and paid. The filing and payment shall be done within 25 days following the close of each taxable quarter, or on a quarterly basis using BIR Form No. 2550-Q (Quarterly Value-Added Tax Return).

The change will only require taxpayers to file a total of four VAT returns as compared to the normal 12 filings within the taxable year. This will also provide ample time to gather all necessary supporting documents for the taxpayer’s claim of input VAT.

REVERSION TO ORIGINAL RATES OF THE PREVIOUSLY LOWERED TAX RATES
The implementation of the CREATE Act in 2021 provides tax relief to address the fluctuating needs of the business affected by the COVID-19 pandemic. These include a reduction in the tax rates for a specific period. As time progresses and with the expected recovery from the pandemic, it is also anticipated that some of the tax reliefs offered by the government will eventually cease to be implemented, and reversion to original tax rates will take place. Some of the updates in the tax rates that will be affected by the gradual recovery of the country from the pandemic are as follows:

a. 2% Minimum Corporate Income Tax (MCIT)

Under the CREATE Act and per Revenue Regulations (RR) No. 5-2021, the MCIT was lowered to 1%, effective July 1, 2020 to June 30, 2023. Starting July 1, 2023, corporations (except non-profit proprietary educational institutions and hospitals, and non-resident foreign corporations) will now be subject to the original 2% MCIT rate based on their gross income.

a. 10% Special income tax rate for non-profit proprietary educational institutions (PEIs) and hospitals

The CREATE Act also brought with it a lowered special income tax rate of 1% for PEIs and hospitals, beginning July 1, 2020 until June 30, 2023. On July 1, 2023, these corporations will be subject again to a higher rate of 10%. However, if the gross income from “unrelated trade, business or other activity” exceeds 50% of the total gross income derived from all sources by such educational institutions or hospitals, their entire taxable income will be subject to the regular income tax rate.

a. 3% Percentage tax for non-VAT taxpayers

Under Section 116 of the Tax Code, any person whose sales or receipts are exempt under Section 109 (CC) of the Code from the payment of Value-Added Tax and who is not a VAT-registered person must pay a tax equivalent to 3% of gross quarterly sales or receipts, with cooperatives exempt from the 3% gross receipts tax herein imposed.

With the amendment in the CREATE Act, the 3% percentage tax was lowered to 1% beginning July 1, 2020 until June 30, 2023. After that period, effective July 1, 2023, the percentage tax rate will revert to 3%.

Work from home (WFH) arrangement for Philippine Economic Zone Authority (PEZA) — registered Information Technology (IT) — Business Process Management (BPM) entities

The Fiscal Incentives Review Board (FIRB) issued FIRB Resolution No. 026-02 allowing IT-BPM entities to continue adopting the WFH arrangement not exceeding 30% of the total workforce, without adversely affecting their income tax incentives, until Dec. 31. Furthermore, IT-BPM entities may transfer their registration to the Board of Investments (BoI) from the Investment Promotion Agencies (IPA) administering an economic zone or freeport zone where the project is located, until Dec. 31.

With these issuances, the IT-BPM entities are expected to have registered with the BoI starting Jan. 1 and are entitled to adopt up to 100% WFH arrangement.

Dealing with these continuous changes in taxation can be exhausting and overwhelming. Taxpayers should always have the necessary information to help themselves overcome the unknown. Knowing the correct rules means half the battle is won.

Let’s Talk Tax is a weekly newspaper column of P&A Grant Thornton that aims to keep the public informed of various developments in taxation. This article is not intended to be a substitute for competent professional advice.

 

Mary Grace G. Lualhati is a senior-in charge from the Tax Advisory & Compliance division of P&A Grant Thornton, the Philippine member firm of Grant Thornton International Ltd.

pagrantthornton@ph.gt.com

How to explore ASEAN

FREEPIK

It is important to know about Free Trade Agreements, such as the ASEAN Free Trade Area (better known as AFTA) which covers the ASEAN region. Before we even get into the RCEP (Regional Comprehensive Economic Partnership), ASEAN Plus, and other groupings, it makes sense to know first about ASEAN — the Association of Southeast Asian Nations.

Who are the member states? You will be surprised that some people do not bother to know what countries belong to ASEAN. Ambassador Delia Albert, a staunch advocate of regional cooperation, taught us the basics which are as follows:

1. Learn to say “ASEAN” properly. Say “AS-YAN” not “EY-SIAN.”

2. Know which countries are called member states or AMS — ASEAN Member States.

3. Find out about cultural and religious differences. For example, when entertaining ASEAN delegates, be sensitive about offering halal food. Also serve many vegetarian choices.

4. Consider prayer rooms. While Catholics only look for churches, our Muslim brothers and sisters need a place for quiet prayer, a few times a day.

5. Be punctual even if the others are not. It is best to correct the notion and reputation about Filipino time.

After learning the basics of cultural complexities, know what networks there are:

1. AWEN — Asean Women Entrepreneurs Network. Now headed by Indonesia, it rotates leadership or chairship every two years. It started with Vietnam in 2014-2016, the Philippines in 2016-2018, Thailand in 2018-2020, and now Indonesia until 2023 (there was an exception to extend the term due to the COVID-19 restrictions in 2020).

2. ASEAN-BAC — the ASEAN Business Advisory Council, a private sector led business leaders’ group which also includes Joint Business Councils (JBCs) and AWEN.

3. ASEAN Coffee Federation — a coalition of national coffee organizations across the ASEAN member states. The Philippine Coffee Board, Inc. Has been our country’s representative for the last 10 years now.

4. AMEN — the ASEAN Mentors Network. Established during the Philippines chairship in 2017, it has over 100 mentors that cross geographical boundaries, with senior executives mentoring younger leaders and entrepreneurs.

5. ASEAN Young Entrepreneurs Council (AYEC) — for those younger CEOs, those who are below 40 years old.

These are just some of the many networks for private sector involvement in ASEAN affairs, business cross-matching and optimizing business connections and opportunities, like the Free Trade Agreements, among other regional non-tariff issues.

The ASEAN headquarters is located in Jakarta, Indonesia and is the main office for all the many departments under the political, economic, and social pillars of the regional authority. It is worth looking at the organizational chart of the ASEAN to find out how your business can benefit from cross-border connections.

In the Philippines, Philwen, or the Philippine Women’s Economic Network, representing the concerns of women business organizations, is the AWEN representative organization and has been tasked to implement regional programs such as the grant from OXFAM. Non-profits and grantors find it expedient to deal with coalitions in lieu of single country groups, as the initiative then becomes region-wide. If your sector has a need for policies that can be discussed in ministerial meetings, then the way to go is to band together, so your concern is regional and not just national.

In the case of the ASEAN Coffee Federation, for example, it was recognized by the ASEAN as a vital coalition with coffee being a major export of Vietnam and Indonesia. Vietnam is now the No. 1 producer of Robusta coffee in the world while Indonesia remains one of the top 10 producers of both Arabica and Robusta in the world. Even if the Philippines is currently a net importer of coffee, it bodes well for us to join the ranks of the top producers of ASEAN, having access to important data and opportunities in the coffee sector that we otherwise may not have had.

And this is the same for private business in any industry. For you to optimize opportunities offered to only ASEAN member states, it may be good for you to explore joining an organization which figures well in ASEAN matters.

There also are programs like ASEAN Access, which allows business people to find other important connections vital to their business sector, company, or organization. There are many initiatives and all you need to do is get invited. But for you to get that precious invitation, your business must be open to collaborations, even partnerships, across the member states.

We started by visiting each of the member states. It is not expensive when you think of the distance of each country from Manila. You can visit all nine other member states on a mission to find your business opportunity. The other way is to join the delegation to ASEAN conferences. It may be your most economical investment to get to meet other business people from nine other states, and explore opportunities.

There are many examples of regional players who have made it big from the Philippines — Universal Robina, Oishi, Penshoppe, to name a few. But one need not be as big as they are to find your potential ASEAN partner. All you need to do is be present at the events and establish your network of like-minded potential business partners.

The next event is in Cambodia this October and the handover in November. Check out the website of the ASEAN for more information but go ahead and start learning about the ASEAN.

Again, learn how to say it: it’s AS-YAN, not EY-SIAN.

This article reflects the personal opinion of the author and does not reflect the official stand of the Management Association of the Philippines or MAP.

 

Chit U. Juan is a member of the MAP Diversity & Inclusion Committee, and the MAP Agribusiness Committee. She is Chair of the Philippine Coffee Board, and Councilor of Slow Food for Southeast Asia.

map@map.org.ph

pujuan29@gmail.com

It’s better to mine the world’s rainforests than farm them

JUSTIN CLARK-UNSPLASH

AS IF THE WORLD’s rainforests didn’t have enough problems to contend with, even the transition to zero-carbon power is threatening to level them.

Industrial mining ate up 3,265 square kilometers (1,260 square miles) of tropical forest between 2002 and 2019, according to a recent study in the Proceedings of the National Academy of Sciences. Some 80% of that total happened in just four countries: Indonesia, Brazil, Ghana, and Suriname.

With the COP27 climate conference in the Egyptian resort of Sharm El Sheikh next week expected to increase the focus on the climate needs of developing countries, that’s raised concerns that there isn’t enough land to manage a shift away from fossil fuels. Much of the world’s reserves of nickel, an essential metal for making electric-vehicle batteries, lie under the rainforests of Southeast Asia. Some 6,732 sq km of Indonesian forest has been granted to nickel mining concessions, a coalition of environmental groups wrote in a July letter to Tesla, Inc.

An “honest and comprehensive evaluation of the entire life cycle of clean energy” cars would show a “negative societal and environmental impact” on land, Michael Heberling, an academic at Michigan’s Baker College, noted this year.

Mining certainly involves destruction of the land that surrounds it. Even where minerals are extracted from underground rather than surface mines, the tailings, processing facilities, and transport infrastructure that surround them consume many hectares of countryside.

Still, the challenges of preserving the world’s ecosystems are so vast that we risk looking only at one small part of the elephant, rather than the whole beast. Almost every economic activity carries some sort of environmental cost. The question isn’t about finding activities that are cost-free, but identifying the ones that maximize the associated social and economic benefits.

At the outset, it’s worth considering that the sheer amounts of commodities that we use each year vary greatly: about 8.2 billion tons of coal and 4.2 billion tons of oil; 1.2 billion tons of corn and 780 million tons of wheat; 25 million tons of copper and 2.7 million tons of nickel; 3,000 tons of gold and 180 tons of platinum.

That doesn’t give the whole story, though. Nickel ores contain about a thousand times more metal per ton than gold ores, so the far smaller output of the gold industry results in a roughly similar volume of waste rock. Then there’s the question of surface disturbance: commodities extracted from open-cut mines such as iron ore have a far bigger footprint than those like platinum that are mostly mined from deep underground. Oil and gas tapped from the ocean floor don’t take up a single hectare of land, except for what’s used for onshore transport and processing.

Looked at in terms of land intensity — the number of hectares needed to supply humanity’s needs — it’s clear that minerals are still a highly efficient use of space. All the world’s mines cover just 101,583 square kilometers, according to a study this year based on satellite observations — a smaller area than we use to grow oats, and equivalent to less than 0.2% of the world’s agricultural land.

Another consideration is how often the commodity gets re-used. The 50kg of nickel in an electric car battery will get used again and again over the tens of thousands of kilometers the vehicle is driven, and then may well be recycled for other uses when the vehicle is scrapped. The 50 liters of gasoline in your fuel tank, on the other hand, will need to be refilled several thousand times before the car is taken to the junkyard. Farmland, for all the vast areas that it consumes, can produce the same volumes year after year, even increasing over time with improvements in agricultural yields.

Energy is an important and related consideration. If your electric car is charged up with power produced by burning coal, it’s likely to have a far more substantial land footprint than with electricity from nuclear, wind, or gas — both because coal is profligate in terms of its demands for land, and because its supplies must be constantly renewed by digging yet more coal. Solar power, for all its advantages in terms of carbon emissions, also chews up a great deal of land.

A final consideration is to think about the cost of land use as well as its benefits. All land is not created equal. Some 60% of the world’s carbon biomass is stored in forests, with another 22% in grasslands and savannah. Keeping that carbon locked up in living tissues rather than venting it into the atmosphere is a burden that falls particularly hard on lower-income tropical countries, which have some of the largest reserves of forest and some of the greatest needs to consume land as an input into economic growth.

That’s where the rest of the world has a part to play. Economic development requires not just land, but labor, capital, and productivity improvements. Most emerging countries have no shortage of labor, but the capital required to develop land efficiently and drive their economies up the productivity value chain is far too scarce. Pledges that rich nations made a decade ago to provide $100 billion in annual investments to the rest of the world to decarbonize and adapt to the effects of climate change have still not been met.

If wealthy countries want the tropical forest lands that have already been cleared to be used more efficiently — and, where possible, returned to their natural state — then they’re going to need more, not less capital-intensive activity. Mining isn’t devoid of environmental impacts. But it’s a lot better than most of the alternatives.

BLOOMBERG OPINION

This week: Growth, commodities inflation, and births deflation

With a generally bad economic environment globally, especially in Europe and China, it is important that the Philippines should do more investment promotion roadshows abroad and institute business-friendly domestic policies. The goal is to attract many companies leaving Europe, China, and even the US, while keeping investors that are already here.

There were four Philippine Economic Briefings (PEB) done already by the economic team — in Jakarta and Singapore on Sept. 6 and 7, New York City in Sept. 22, and Washington D.C. in Oct. 15. These are good initiatives, with the economic team talking face to face with big potential investors in big financial centers like Singapore and New York.

Last week, on Oct. 26, Budget Secretary Amenah Pangandaman and Finance Secretary Benjamin Diokno met with business leaders of the US-ASEAN Business Council (US-ABC) and reiterated the recent market-oriented reforms that are conducive to foreign investors.

Then, on Oct. 28, the National Economic and Development Authority (NEDA) Board’s Investment Coordination Committee-Cabinet Committee (ICC-CabCom) met on various project proposals submitted by agencies and government bodies, and on the approval of the updated NEDA-ICC guidelines for PPP (private public partnerships) projects. The Finance and NEDA Secretaries are co-chairs of the ICC while members include the Executive Secretary, the Governor of the Bangko Sentral, and the Secretaries of Budget and Trade.

GROWTH IN Q3 2022
I mentioned the bad economic environment in Europe and China as shown by their GDP growth in the third quarter (Q3) of 2022. Germany grew only 1.2%, France 1%, Spain 3.8%, China 3.9%, and the US 1.8%. Other major economies like the UK, Italy, and Japan have not released Q3 results yet.

Economies in East Asia seem to be the medium-size growth drivers in the world. Their GDP growth in Q3 2022: Vietnam 13.7%, Singapore 4.4%, Taiwan 4.1%, South Korea 3.1%. Vietnam and Taiwan were among the very few economies that did not contract in 2020, then they continued their momentum in 2021 and 2022.

The “high” growth of Spain and France in 2021 and 2022 was mainly due to “base effect” — they had very deep economic contractions in 2020, a very low base that year, and even a mild increase in economic activities in the succeeding years would constitute “high” growth already. The Philippines’ Q3 will be released on Nov. 10 but so far, we grew 7.8% in Q1-Q2 already.

One reason why Vietnam and Taiwan were able to sustain their growth momentum in 2022 is because they did not follow the US Fed’s huge interest rate hikes that penalize businesses in the name of fighting high inflation (Table 1).

I retain my growth projection for the Philippines of 7-7.5% in Q3, Q4, and full year 2022. One proxy I use is energy sales growth, then I add other considerations. For instance, in 2021, Meralco energy sales growth over 2020 was 5.7%, exactly the same GDP growth in 2021. For 2022 first half (Q1 and Q2), Meralco energy sales growth was 5.7% but Q3 sales growth was 7.1%, which is a good indicator that households and businesses are humming stronger. I have personally observed this too in many provinces.

COMMODITIES INFLATION
This column has discussed comparative inflation rates in many countries before — see for instance “The ERC, NGCP, inflation and public debt” (Oct. 10). Today we will discuss important commodities and their price hikes over the past two years. I use the latest data, that of Oct. 28, and compare the prices on the same date in 2021 and 2020.

The irrational “war on fossil fuels” has produced irrational and unwanted results: high energy prices, from gasoline and diesel to electricity; high fertilizer prices, like that of ammonium nitrate because the main raw materials to produce ammonia and urea are natgas and oil; high industrial prices for items like bitumen, asphalt, and paints because their main raw material is crude oil; high agricultural prices because of high fertilizer prices, and high livestock prices because feeds — from corn, soybeans, etc. — have high prices.

The big jump in energy prices started in 2021, even before the Ukraine war. See the column on year-on-year (Yoy) 1% changes, much higher than Yoy2% changes (Table 2).

It is wrong, it is dishonest, to keep blaming the Ukraine war for the high inflation experienced in many countries around the world. Three factors produce the current high inflation situation. One, the war on fossil fuels. Two, the economic sanctions against energy and industrial exports of Russia by countries which have no territorial dispute with Russia in the first place. And, three, the huge money printing, public spending, and borrowings.

BIRTHS DEFLATION
The Philippine Statistics Authority (PSA) released an update of vital statistics last week, with data until Aug. 31. Since June-July data are still incomplete, I used only data for January-May. The trend of declining births continues and I think this is troubling (Table 3).

Decline in births in 2020 was mainly due to strict lockdown by the Duterte administration — few parties and big gatherings, few marriages. These continued until about mid-2021. Then mass vaccination started in March 2021. Many reports and studies since then have supposedly established a link between the mRNA vaccines and women’s menstruation and men’s lower sperm count.

See these recent articles by my friend and fellow columnist in BusinessWorld, Jemy Gatdula:

1. “Of vaccines, heart attacks, menstruation and others” (July 28),

2. “COVID, the CDC, and the CHED’s continuing discrimination against the unvaccinated” (Aug. 18),

3. “Sanity, for now, returns to higher education” (Sept. 1),

4. “COVID vaccines may be harming our young” (Sept. 22),

5. “Are COVID vaccines harming our young?” (Oct. 13), and

6. “If vaccines couldn’t stop COVID transmission, then why were they almost made mandatory?” (Oct. 27).

All major economies in the world now have big populations. China, India, the US, Brazil, Japan, Indonesia, Russia, etc. A big population means a large number of workers and entrepreneurs, a large number of producers and consumers.

President Marcos Jr. should order a pause in mass vaccination and booster shots in the country pending deep investigations on the long-term effects of those COVID vaccines. Especially as pertaining to heart diseases (myocarditis, pericarditis, etc.) and people’s reproductive health.

 

Bienvenido S. Oplas, Jr. is the president of Minimal Government Thinkers.

minimalgovernment@gmail.com

Lula narrowly beats Bolsonaro to win Brazil presidency again

LUIZ INACIO LULA DA SILVA gestures at an election night gathering on the day of the Brazilian presidential election run-off in Sao Paulo, Brazil, Oct. 30. — REUTERS

SAO PAULO/BRASILIA — Brazilian leftist leader Luiz Inacio Lula da Silva narrowly defeated President Jair Bolsonaro in a runoff election, but the far-right incumbent did not concede defeat on Sunday night, raising concerns that he might contest the result.

The Supreme Electoral Court (TSE) declared Mr. Da Silva the next president, with 50.9% of votes against 49.1% for Mr. Bolsonaro. The 77-year-old Mr. Da Silva’s inauguration is scheduled for Jan. 1.

It was a stunning comeback for the leftist former president and a punishing blow to Mr. Bolsonaro, the first Brazilian incumbent to lose a presidential election.

“So far, Bolsonaro has not called me to recognize my victory, and I don’t know if he will call or if he will recognize my victory,” Mr. Da Silva told tens of thousands of jubilant supporters celebrating his win on Sao Paulo’s Paulista Ave.

A source in the Bolsonaro campaign told Reuters the president would not make public remarks until Monday. The Bolsonaro campaign did not respond to a request for comment.

Mr. Bolsonaro last year openly discussed refusing to accept the results of the vote, making baseless claims that Brazil’s electronic voting system was vulnerable to fraud.

One close Bolsonaro ally, lawmaker Carla Zambelli, in an apparent nod to the results, wrote on Twitter, “I PROMISE you, I will be the greatest opposition that Lula has ever imagined.”

Financial markets might be in for a volatile week, with investors gauging speculation about Mr. Da Silva’s cabinet and the risk of Mr. Bolsonaro questioning results.

The vote was a rebuke for the fiery far-right populism of Mr. Bolsonaro, who emerged from the back benches of Congress to forge a novel conservative coalition but lost support as Brazil ran up one of the worst death tolls of the coronavirus pandemic.

US President Joseph R. Biden congratulated Mr. Da Silva for winning “free, fair and credible elections,” joining a chorus of compliments from European and Latin American leaders.

International election observers said Sunday’s election was conducted efficiently. One observer told Reuters that military auditors did not find any flaws in integrity tests they did of the voting system.

Truck drivers believed to be Mr. Bolsonaro’s supporters on Sunday blocked a highway in four places in the state of Mato Grosso, a major grains producer, according to the highway operator.

In one video circulating online, a man said truckers planned to block the country’s main highways, calling for a military coup to prevent Lula from taking office.

PINK TIDE RISING
Mr. Da Silva’s win consolidates a new “pink tide” in Latin America, after landmark leftist victories in Colombia and Chile’s elections, echoing a regional political shift two decades ago that introduced Mr. Da Silva to the world stage.

He has vowed a return to state-driven economic growth and social policies that helped lift millions out of poverty during two terms as president from 2003 to 2010. He also promises to combat destruction of the Amazon rainforest, now at a 15-year high, and make Brazil a leader in global climate talks.

“These were four years of hatred, of negation of science,” Ana Valeria Doria, 60, a doctor in Rio de Janeiro who celebrated with a drink. “It won’t be easy for Mr. Da Silva to manage the division in this country. But for now it’s pure happiness.”

A former union leader born into poverty, Mr. Da Silva organized strikes against Brazil’s military government in the 1970s. His two-term presidency was marked by a commodity-driven economic boom and he left office with record popularity.

However, his Workers Party was later tarred by a deep recession and a record-breaking corruption scandal that jailed him for 19 months on bribery convictions, which were overturned by the Supreme Court last year. — Reuters

World food supplies at risk as Russia withdraws from Black Sea deal

REUTERS

SINGAPORE — Russia’s weekend backtrack from a United Nations (UN)-brokered deal to export Black Sea grains is likely to hit shipments to import-dependent countries, deepening a global food crisis and sparking gains in prices.

Hundreds of thousands of tons of wheat booked for delivery to Africa and the Middle East are at risk following Russia’s withdrawal, while Ukrainian corn exports to Europe will take a hit, two Singapore-based traders said.

Russia on Saturday suspended participation in the UN grain deal for an “indefinite term,” after what it said was a major Ukrainian drone attack on its Black Sea fleet in Crimea.

“If I have to replace a vessel which was due to come from Ukraine, what are the options? Not much really,” said one Singapore-based grains trader who supplies wheat to buyers in Asia and the Middle East.

Earlier this year global wheat prices Wv1 jumped to an all-time high and corn hit a 10-year top as Russia’s invasion of Ukraine added fuel to a rally set off by adverse weather and coronavirus supply disruptions.

Australia, a key wheat supplier to Asia, is unlikely to be able to fill any supply gap, with shipping slots booked right up to February, traders said.

No ships moved through the established maritime humanitarian corridor on Sunday. The UN, Turkey and Ukraine, however, pressed ahead to implement the Black Sea grain deal and agreed on a transit plan for Monday for 16 vessels to move forward, despite the withdrawal of Russia.

“We have to see how the situation unfolds. It is not clear if Ukraine will continue to ship grains and what happens to Russian exports,” said the Singapore-based grains trader.

Chicago wheat futures on Monday jumped more than 5% and corn rose over 2%.

Asian buyers recently booking Ukrainian wheat cargoes include Indonesia, the world’s second-largest importer of the grain, although the region typically relies on Australia and North America.

In recent deals, Indonesian millers bought four cargoes or around 200,000 tons of Ukrainian wheat for November shipment in deals signed over the last few weeks, traders said.

Last week, a government agency in Pakistan bought about 385,000 tons of wheat in a tender likely to be sourced from Russia and Ukraine.

“We are not sure if Russia will continue to export wheat or it will be safe for vessels carrying Russian wheat to ship from the Black Sea even as Ukrainian exports remain blocked,” said a second Singapore-based trader at an international company.

Under the UN-brokered grains deal, a Joint Coordination Centre (JCC) made up of UN, Turkish, Russian and Ukrainian officials agree on the movement of ships and inspects the vessels. More than 9.5 million tons of corn, wheat, sunflower products, barley, rapeseed and soy have been exported from the Black Sea since July. — Reuters

Death toll from India’s bridge collapse rises to 132

STOCK PHOTO | Image by jorono from Pixabay

AHMEDABAD — The death toll from a bridge collapse in Gujarat in India rose to 132, a local government official told Reuters on Monday.

A footbridge over the Machhu River in the town of Morbi was packed with sightseers enjoying holiday festivities when it collapsed on Sunday, plunging people into the river below.

“The death toll in the bridge collapse incident has gone up to 132. The search and rescue operations are continuing,” said the senior official, NK Muchhar, adding that the toll could rise further.

Armed forces personnel along with national disaster management and emergency teams from nearby districts were deployed to trace missing people and help with rescue operations, Muchhar said.

Authorities said more than 400 people were on and around the colonial-era suspension bridge at the time of the collapse. The bridge had drawn many sightseers celebrating the Diwali, or festival of lights, and Chhath Puja holidays.

A five-member team was appointed to conduct an investigation into the disaster.

The 230-meter bridge was built during British rule in the 19th century. It had been closed for renovation for six months and was reopened for the public recently. — Reuters

Thunberg says COP27 is just an opportunity for ‘greenwashing and lying’

REUTERS

LONDON — Climate activist Greta Thunberg on Sunday called out next month’s United Nations climate summit in Egypt for being “held in a tourist paradise in a country that violates many basic human rights.”

Speaking at the London Literature Festival at the Southbank Centre where she was promoting her new book, The Climate Book, 19-year-old Ms. Thunberg dismissed the looming climate summit, known as COP27, as an opportunity for “people in power… to [use] greenwashing, lying and cheating.”

While Ms. Thunberg did attend protests in Glasgow last year for COP26, she said she won’t attend COP27, scheduled to be held from Nov. 6 to Nov. 18 in Sharm El Sheikh.

“The space for civil society is going to be extremely limited,” she said. “It’s important to leave space for those who need to be there. It will be difficult for activists to make their voices heard.”

Public demonstration is effectively banned in Egypt and limits on accreditation and attendance badges for activists have been a point of contention at previous UN climate summits.

Thunberg rose to prominence in 2018 at the age of 15 by staging school strikes in her native Sweden, becoming the face of the youth activist climate movement.

During Sunday’s event, she decried the “sustainability crisis” as a “crisis of information not getting through.”

Her book includes explanatory articles from over 100 climate experts, including renowned climate scientists Katharine Hayhoe and Michael Mann, as well as authors including Margaret Atwood.

“I wanted it to be educational, which is a bit ironic since my thing is school strikes,” she said.

Asked to comment on recent protest actions by Just Stop Oil activists which saw them throw soup at Vincent van Gogh’s ‘Sunflowers’ at London’s National Gallery, Ms. Thunberg said, “People are trying to find new methods because we realize that what we have been doing up until now has not done the trick. It’s only reasonable to expect these kinds of different actions.” — Reuters

Macau reimposes tough COVID curbs with casino lockdown as cases rise

BRENDEN BRAIN/CC BY-SA 3.0/WIKIMEDIA COMMONS

HONG KONG — Macau authorities reinstated tough coronavirus disease 2019 (COVID-19) curbs including locking down a major casino over the weekend after a handful of cases were detected, even as China announced a loosening of visa rules for visitors to the world’s biggest gambling hub.

Authorities locked down the MGM Cotai casino resort owned by MGM China on Sunday with staff and guests ordered to stay inside until Nov. 1. All of Macau’s 700,000 residents are mandated to take antigen tests daily during the period, the government said.

The casino closure deals a blow to operators who have already been grappling with China’s “zero COVID” restrictions for more than two and a half years, losing millions of dollars monthly.

Macau has been coronavirus-free for more than three months until last week. The swift return of curbs marks a potential setback for industry executives and investors who were keen for a quick recovery in gambling revenues in the Chinese special administrative region.

The prospects for travel to Macau have improved, however, with China’s immigration bureau saying on Monday that mainland residents would be able to use an online visa system from Nov. 1 to travel to the former Portuguese colony.

In-person applications have been required for the past two and a half years due to COVID-19 restrictions, but the bureau said that as the current COVID situation in Macau was stable and demand to visit the city was increasing, the government had decided to offer e-visas.

Shares in Hong Kong-listed Galaxy Entertainment and Wynn Macau dropped more than 3% early in Monday’s session but later reversed course to trade in positive territory.

Macau casino executives also said a decision on new licenses could come as early as this week.

Macau’s six casino operators — Sands China, Wynn Macau, Galaxy Entertainment, MGM China, Melco Resorts and SJM Holdings — are awaiting a government decision on whether they will be granted new licences that would allow them to continue operating in 2023.

Any operators unable to secure a new license would be required to return their premises to the government. New license terms will be 10 years versus 20 years previously, giving operators a shorter horizon to make back billions of dollars they have to invest under the government’s mandate. — Reuters

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