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Tourism industry understaffed for ‘revenge travel’

Back to almost normal. Fans who waited for the arrival of K-pop act Super Junior at the Suvarnabhumi International Airport begin to disperse after midnight. On the whole, Thais displayed mask discipline — perhaps equal or even better than our own. — PHOTO BY KAP MACEDA AGUILA

By Luisa Maria Jacinta C. Jocson, Reporter

THE tourism industry is struggling to staff up for the wave of “revenge travel,” with many employees from businesses that shut down having moved on to other jobs, the travel agency industry association said.

“The biggest problem is we lack frontliners. The travel agencies that closed (saw their) employees look for other jobs. Now that the business is back because of revenge travel, it’s not easy for them to get their old employees back,” Philippine Travel Agencies Association (PTAA) President Michelle G. Taylan said during a press conference on Friday.

“We are now getting back to where we used to be… We are in need of tourism frontliners so that means jobs in the tourism industry are coming back,” she added.

Ms. Taylan said that the industry is hoping to promote destinations in Mindanao and others that are less well known or commercial.

“Mostly we will be promoting provinces, especially those not widely visited,” she said.

“We have to promote the entire Philippines, not just popular destinations like Boracay,” she added.

According to the PTAA, the top travel destinations this year are Boracay, Palawan, Siargao, and Cebu.

Ms. Taylan said many PTAA members are urging the government to establish a tourist police force and reduce fees for business permit applications.

“Our board members keep mentioning tourist police in order to clean out all the illegal travel agencies,” she said.

“As we are at the peak of the recovery, we are asking for business permits for travel agencies and discounts on taxes from local government units, especially for those not able to renew their permits during the pandemic. If they are going to renew next year, the penalty will be very big,” she added.

Tourism Secretary Maria Esperanza Christina G. Frasco said in speech on Friday that the pace of the industry’s recovery is “promising.”

“As of today, we have over 1.3 million arrivals (since borders reopened). We welcome the recovery of the tourism sector with optimism and hope. The industry is a major economic pillar for our nation’s recovery,” she added.

For 2023, Ms. Taylan projected arrivals to double or triple.

“I am just basing it off the number of bookings. Based on the experience of our members, they are overflowing with bookings,” she added.

Air quality worst in Benguet, Rizal, Metro Manila, Greenpeace says

DOT.GOV.PH

BENGUET, Rizal, and Metro Manila are at the bottom of the air quality standings, with over 97% of their population exposed to some of the highest particulate matter (PM) concentrations in the entire country, Greenpeace said in a report.

All Filipinos are exposed to air that fails to meet World Health Organization (WHO) guidelines, Greenpeace said. The WHO considers air of acceptable quality to contain no more than 5 micrograms of PM per cubic meter of air (5 µg/m3), it said in a report issued on Sept. 2.

However, Benguet, Rizal, and Metro Manila average 25 µg/m3, the non-government organization said.

PM refers to fine inhalable particles. Particles of about 2.5 micrometers are referred to as PM2.5, the industry standard for airborne pollutants.

To address the air quality problem, Greenpeace supports a phaseout of fossil-based energy projects and a reliable energy source that does not depend on imports.

Greenpeace Campaigner Khevin Yu told BusinessWorld by phone over the weekend that the argument against imported fuel is also economic because “Right now, in terms of fossil gas prices here and globally, it is expensive.”

“Improving air quality is not only a matter of ensuring health and justice, but also of addressing the climate crisis and eliminating the common denominator — our country’s dependence on dirty energy,” Mr. Yu said in a statement released earlier.

A separate report issued by the Global Wind Energy Council (GWEC) and the Global Solar Council (GSC) highlighted the dangers of fossil fuel dependence, as reflected in the current energy crisis.   

GWEC and GSC said governments need to encourage public and private investment in clean energy.

Michael O. Sinocruz, director of the Energy Policy Planning Bureau at the Department of Energy (DoE), said in an e-mail on Sept. 1 that net-zero goals imply a 100% share of renewable energy (RE) in the power generation mix, or an effort to “blend renewable energy with other emerging clean energy technologies.”

Currently, the DoE is targeting an RE share of 30% in the energy mix by 2030 and 50% by 2040. — Ashley Erika O. Jose

GOCC subsidies rise 398.78% in July

SUBSIDIES provided to government-owned and -controlled corporations (GOCCs) rose 398.78% year on year to P30.321 billion in July, the Bureau of the Treasury (BTr) reported.

Budgetary support to GOCCs also rose 145.95% compared to the June total. Subsidies amounted to P75.01 billion in the first seven months, according to preliminary data from the BTr.

Subsidies are extended to GOCCs to cover operational expenses not supported by their revenue.

The Philippine Health Insurance Corp. (PhilHealth) was the top recipient, taking in P22.462 billion or 74.08% of all subsidies in July. It did not receive subsidies prior to July.

The National Irrigation Administration (NIA) received P5.872 billion in July, with its seven months to July total at P24.218 billion to lead all GOCCs.

The National Privacy Commission received P400 million, against zero the preceding month.

Other top recipients in July were the Development Academy of the Philippines (P214 million), the Light Rail Transit Authority (P162 million), the Sugar Regulatory Administration (P157 million), the Philippine Heart Center (P153 million), and the National Food Authority (P137 million).

Other GOCCs that were given at least P50 million were the National Kidney and Transplant Institute (P107 million), the Philippine Children’s Medical Center (P105 million), the Philippine Coconut Authority (P100 million), the Philippine Rubber Research Institute (P74 million), the Lung Center of the Philippines (P58 million), and the National Tobacco Administration (P50 million).

The Local Water Utilities Administration, the National Electrification Administration, and the National Housing Authority (NHA) were among the major nonfinancial GOCCs that did not receive subsidies.

Other GOCCs that received no subsidies during the month were the Bases Conversion and Development Authority, the Civil Aviation Authority of the Philippines, the Philippine Crop Insurance Corp., the Philippine Fisheries Development Authority, the Small Business Corp., the Subic Bay Metropolitan Authority, and the Social Housing Finance Corp.

In the seven months to July, subsidies fell 20.51% from a year earlier.

The NIA accounted for 32.29% of the total, followed by PhilHealth and the NHA, which got P22.462 billion and P8.941 billion respectively.

Government subsidies to GOCCs totaled P184.77 billion in 2021, a 19.3% decline from the previous year. In 2021, the PhilHealth received P80.98 billion, nearly 44% of the total. — Diego Gabriel C. Robles

Napocor sees 2 hybrid facilities operational this year

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THE National Power Corp. (Napocor) said it hopes to complete two hybrid facilities in Cuaming, Bohol and Palumbanes Island, Catanduanes province, by the end of 2022.

“Apart from hybridization, Napocor included solar home systems, photovoltaic (PV) mainstreaming, and wind resource assessment (WRA) in its programs,” Melchor P. Ridulme, Napocor officer-in-charge, said in an e-mail on Sept. 1.

Mr. Ridulme said that Napocor’s programs are in line with policies outlined by Energy Secretary Raphael P.M. Lotilla seeking to increase the share of renewable energy in the power mix.

Off-grid areas are typically oil-fired or run-on diesel, to which the industry is attaching renewable technologies like solar or wind to make them hybrid systems.

In the context of discussing a facility in Limasawa, Southern Leyte, Mr. Ridulme said hybrids “reduce our dependency on fuel, minimize carbon emissions, and lower generation costs.”

Napocor’s Limasawa photovoltaic power plant, a solar-diesel hybrid facility, started operations in 2018.

“Since the hybrid system began operating, there had been a reduction in the cost of electricity by an average of 97 centavos per kilowatt-hour and recorded fuel savings of about 31,000 liters of diesel with an estimated amount of P970,000,” he said.

Napocor is also targeting to deploy around 933 solar home systems in Maconacon and Divilacan, Isabela and another 1,706 such systems in Masbate, Bohol, Dinagat, Sulu and Basilan.

In August, Mr. Lotilla said that the Department of Energy is looking to expand hybrid systems to end off-grid areas’ dependence on imported fuel.

The National Electrification Administration has ordered power cooperatives to tap more renewable energy to hybridize their generating capacity. — Ashley Erika O. Jose

How tech companies can stay agile in an uncertain world

(Second of two parts)

Technology companies are stepping into a new era of uncertainty as they develop their global operational models. Decisions on sourcing, supply chains, product and service manufacturing, and distribution are impacted by the accelerated changes affecting complex economic, political, and regulatory changes in the larger corporate environment.

To better understand the additional risks and challenges that technology companies must deal with, EY undertook a global research study with 750 technology executives to help consumers comprehend what technology companies must do to flourish in a changing environment. Moreover, the EY Global Technology Sector team supplemented the findings with additional insights and recommendations.

In the first part of this article, we discussed how technology companies need to withstand uncertainty, address critical regulatory issues, optimize their supply chains, and choose the right operating model.

In this second part, we continue by discussing rethinking the workplace, focusing on continuous change, ensuring worldwide compliance and reporting, and adopting ESG commitments.

RETHINKING THE WORKPLACE
Inertia and uncertainty are frequent obstacles to change. In a recent EY return-to-work study, roughly 54% of employees worldwide shared that if they were not given sufficient flexibility in where and when they work, they would think about leaving their jobs after COVID-19.

Because of this, executives in almost all of the surveyed industry sub-sectors regarded employee satisfaction and well-being as the most crucial factor. Tax and other statutory requirements were ranked as having the highest priority by FinTech executives, followed by the capacity to access or manage labor and skills and employee satisfaction and well-being.

When redesigning work, important factors to keep in mind include:

• Examine what new opportunities will arise as a result of the new, more collaborative ways of working and how roles may alter as a result.

• Check to see if the organization’s new working methods complement its mission, culture, productivity, and performance.

• Determine how much space is needed and how it will be used, while making accommodations for at-home workplaces and technological enablement.

• Consider the ramifications for payroll, regulations, corporate taxes, international employment taxes, and cybersecurity before making decisions.

Technology businesses claimed they are also taking steps to address the evolving nature of work. Talent is an essential resource for the sector, with key performance indicators that include the availability of talent, employee happiness, and attrition rate.

As a result of COVID-19, 87% of executives from technology businesses reported that their organizations had reduced the number of physical workspaces they occupy, and 66% intend to expand their employees’ alternatives for working from home during the next three years. In the post-pandemic context, new operating models and modes of working should successfully combine people, place, and technology, changing how people operate across numerous working environments while keeping essential values and cultural characteristics.

FOCUSING ON CONTINUOUS CHANGE
Technology firms will need a comprehensive and holistic global trade strategy through an agile operating model to thrive and accelerate growth in this continuously changing business environment. It must be able to adapt to changes in international compliance regulations, rethink its staff, and make a commitment to environmental, social and governance (ESG) needs. Every C-suite executive will have to ask themselves if their operating model is prepared to support new initiatives and propel future success in the face of an unpredictable future.

Two out of three technology executives emphasized the need to be flexible and agile, as well as the need for plans to change their operating model over the next three years to serve both current and changing business needs. However, the question of whether they have the tools and systems in place to make changes in real time while considering the overall effects each discrete change will have on the financial conditions and operational effectiveness of the business remains to be answered.

Overall, the executives surveyed indicated that the most important areas they will invest in as enablers to improve their operating models over the next three years are technologies and tools related to customer transactions, relations, and support (58%); supply chain optimization (53%); and supply chain transparency (45%). Majority at 64% intend to alter the organizational structure to enhance tax planning and financial reporting. Due to the increasingly complicated compliance and reporting requirements everywhere in the world, there is a demand for global visibility and risk management.

ENSURING WORLDWIDE COMPLIANCE AND REPORTING
Companies can use combined tax and financial operating systems to support their complicated requirements, which can be easier said than done and expensive for businesses that must continually adjust their own capabilities. To reduce risk and improve both visibility and efficiency, finance functions can utilize standardized methodologies and advanced analytics to stay ahead of the digital curve.

Technology companies will have to keep these key considerations in mind to ensure effective worldwide compliance and reporting:

• Adopt a coordinated strategy for adjusting global tariffs.

• Reduce trade network costs, risks, and delays.

• Create a solid data foundation to increase the effectiveness of reporting and compliance.

• Leverage the proper technologies.

Over the next three years, technology companies will restructure their operational models, prioritizing the commitment to a sustainable future. Nearly two-thirds of the IT leaders who participated in the EY survey agreed that ESG considerations were important when developing their operating model. Reduced shipping costs and energy consumption will also be crucial considerations in operating model design. Long-term sustainability and ESG value can be created by applying the appropriate strategy and optimizing the supply chain, capital allocation, and portfolio, as well as by developing assessment frameworks to measure both financial and non-financial outcomes.

ADOPTING ESG COMMITMENTS
The relevance of ESG, agility, speed, and flexibility are also high on the agenda in specific areas of change and focus over the next three years. ESG emerges as a factor in changes to the supply chain and operations. By implementing the following actions, technology companies can achieve high sustainability performance while giving shareholders profitable returns:

• Recognize the development and efficacy of the present ESG strategy.

• Examine ESG opportunities, impacts, and risks.

• Include ESG in your organization’s overall strategy.

• Communicate with stakeholders and provide performance reports on ESG.

ADAPTING TO HANDLE CONSTANT CHANGE
The one constant in the world economy and the technology sector is the unrelenting and accelerating rate of change. Even the most adaptable firms are finding it difficult to keep one step ahead in this era of extraordinary change, whether it be a game-changing breakthrough or a once in a thousand-year black swan occurrence.

The EY survey discovered that technology company executives are frequently attempting to respond to concerns that impact their functional issues while continuously reviewing their business and operating models. Addressing the immediate problem instead of realizing that there will always be problems requires a comprehensive, holistic strategy to handle ongoing change and expand the company.

The study also notes that changing the operating model to increase company resilience and concentrating on issues like ESG are not separate initiatives. Instead, in the search for technology businesses to become truly adaptive, these become guiding principles that influence practically all upcoming organizational change initiatives. These changes progressively extend into the connections between the key stakeholders of a technology enterprise, from suppliers to consumers.

This article is for general information only and is not a substitute for professional advice where the facts and circumstances warrant. The views and opinions expressed above are those of the author and do not necessarily represent the views of SGV & Co.

 

Rossana A. Fajardo is the EY ASEAN business consulting leader and the consulting service line leader of SGV & Co.

Pressure to end media deal ‘threatens’ freedom

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By Kyle Aristophere T. Atienza, Reporter

POLITICAL pressure that led to the termination of a landmark investment deal between ABS-CBN Corp. and TV5 Network, Inc. poses threats to free enterprise and press freedom, according to analysts.

“This has implications for both freedoms: enterprise and press,” said Terry L. Ridon, a public investment analyst, said in a Facebook Messenger chat at the weekend. “Only now have contracts been terminated due to objections from those in power.”

Pressure from congressmen critical of ABS-CBN, whose franchise renewal application was rejected by allies of ex-President Rodrigo R. Duterte at the House of Representatives in July 2020, sets a bad precedent for governance in the Philippines, he said.

“This creates a chilling effect on the media and its owners, as two of the country’s most respected media institutions have terminated a well-intentioned transaction that would have pushed the envelope of reportage and public service,” he added. 

“If it can happen to the biggest media entities, it can happen to the smallest ones.”

“We generally do not interfere in the Legislature’s exercise of its own powers,” Press Secretary Trixie Cruz-Angeles said in a Viber message.

ABS-CBN was supposed to acquire 34.99% of TV5 for P2.16 billion ($38 million), which could have allowed to show its content to a wider audience through TV5’s free channels.

Under the deal, TV5’s Cignal Cable Corp. was also supposed to acquire 38.88% of ABS-CBN’s Sky Cable Corp. for P2.86 billion.

The termination came days after lawmakers filed resolutions seeking to investigate the deal, which they said could jeopardize the future of TV5, which is owned by Manuel V. Pangilinan-led MediaQuest Holdings, Inc.

Party-list Rep. Rodante A. Marcoleta, who voted to deny ABS-CBN’s franchise renewal two years ago, said TV5 is owned by a foreign national.

ABS-CBN, which was forced off air during the Martial Law regime of the late dictator Ferdinand E. Marcos, was critical of the Duterte government’s deadly war on drugs. The tough-talking leader had accused it of unfair reporting.

Analysts said the attack against a private deal was nothing new because the previous government and its allies had done the same to other companies, including water concessionaires Manila Water Co. and Maynilad Water Services, Inc.

The termination serves as “a warning that free enterprise will only be free if businesses align,” Mr. Ridon said. “This shows how extraneous factors can terminate initiatives which could have raised our standards of public service, culture and innovation.”

“It’s undue interference in the affairs of the business community and sends the wrong message to its innovative initiatives,” Luis V. Teodoro, former dean of the University of the Philippines (UP)  College of Mass Communication, said in a text message.

The deal could have made more information available to Filipinos, he said. “Again, the losers are the citizens and their right to know, which is aided by multiple sources of information.”

Danilo A. Arao, who teaches journalism at UP, said the termination of the deal “perpetuates the existing monopoly of Philippine media.”

“We need more competition among privately owned media to ensure better quality of news and entertainment,” he said in a Messenger chat. “The erstwhile duopoly was already bad but the current monopoly is much worse.”

Mr. Arao also hit the National Telecommunication Commission’s (NTC) move to restrict blocktime arrangements, calling it an attempt to control media practice.

The NTC order came amid the talks between ABS-CBN and TV5. The agency also released a separate order mandating those with broadcast licenses not to deal “with those who have outstanding obligations” to the National Government.

The  House is “controlled by a supermajority that treats critical media as enemies,” Mr. Arao said. “Only public pressure can compel them to do something that goes against their interests.”

“The terminated agreement reflects certain government officials’ death wish for ABS-CBN, which spells the death knell for press freedom,” he added.

Maria Ela L. Atienza, who teaches political science at UP, said many politicians are fond of using an anti-oligarchy or anti-monopoly line in pursuing their political agenda.

“They use words irresponsibly without accurate information because they think so little of the Filipino public,” she said in a Viber message. “Their goal is to deceive and focus on what appears to be popular but can actually be fact-checked.”

“Populism and pandering to emotions are not only visible in the country but in many countries.”

She urged educators and civic groups to counter populism that is being used to attack critical media by raising public awareness about the importance of the right to information.

Ms. Atienza said the public would be the loser since ABS-CBN was denied a fresh franchise.

“They cannot always access media digitally and are deprived of urgent or relevant information the former reach of ABS-CBN in the regions was able to provide,” she said. “People are also deprived of choices in terms of media providers.”

Meanwhile, Party-list Rep. Rep. France L. Castro said some congressmen would push a fresh franchise for ABS-CBN.

“We will still try to push for a new franchise for ABS-CBN to create more jobs, fight fake news and extend more help to the Filipino people,” she said in a Viber Message.

“As we defend press freedom in the country, the youth shall support the efforts of ABS-CBN and its journalists to reach more Filipinos with their stories for the public good while providing livelihood for displaced media personnel,” Party-list Rep. Raoul Danniel A. Manuel said in a separate Viber message.

Both lawmakers together with Party-list Rep. Arlene D. Brosas have filed House Bill 1218, which seeks to renew the media company’s franchise.

Surigao Del Sur Rep. Johnny T. Pimentel and Cagayan de Oro Rep. Rufus B. Rodriguez have also filed similar bills. — with Matthew Carl L. Montecillo

Marcos vows to get investment deals in two state visits

PHILIPPINE STAR/KRIZ JOHN ROSALES

PHILIPPINE President Ferdinand R. Marcos, Jr. on Sunday promised to secure investment pledges as he left for his state visits to Indonesia and Singapore.

In a speech before his flight, the president said his state visits would “seek to harness the potentials of our vibrant trade and investment relations.”

“An economic briefing, business forums and meetings have been organized to proactively create and attract more investments and buyers for our exports, in order to accelerate the post-pandemic growth of our economy,” he said.

Mr. Marcos and other state officials will stay in Indonesia until Tuesday and will head to Singapore next.

Among those who accompanied him were Trade Secretary Alfredo E. Pascual and Foreign Affairs Secretary Enrique A. Manalo.

Vice-President Sara Duterte-Carpio will serve as officer-in-charge in the president’s absence, according to an order signed by Executive Secretary Victor D. Rodriguez.

The president’s first stop in Indonesia is Jakarta, where he will meet President Joko Widodo to discuss bilateral relations and geopolitics.

They will witness the signing of several agreements, particularly on defense and security, the creative economy and culture.

These include the Philippines-Indonesia Plan of Action for the next five years, which Mr. Marcos said “commits both countries to projects and activities covering the full range of bilateral ties.”

“We will reaffirm our ties with a fellow archipelagic nation and ASEAN co-founder, Indonesia, with whom we share an extensive maritime border in the south of the Philippines.”

The Philippine leader said he would seek partnership with Indonesia for investments in critical areas such as agriculture and energy, his administration’s major priorities.

In his Singapore visit on Sept. 6 and 7, Mr. Marcos will meet both President Halimah Yacob and Prime Minister Lee Hsien Loong to boost trade and investment relations.

He is expected to renew the Philippines’ commitment to bilateral relations and discuss regional and global issues with them.

Singapore has become the Philippines’ top trading partner in the region and the top source of approved investments in 2021, Mr. Marcos said.

“I expect that we will be coming back with a harvest of business deals to be signed in my state visits that will further strengthen our economic ties with both Indonesia and Singapore,” he said.

Mr. Marcos said the initiatives are in line with his government’s priorities. These include agriculture, food security, energy and long-term plans for the country’s emergence into the new global economy.

He will also meet with the Filipino community in Singapore, which is home to 200,000 Filipinos, the presidential palace said. — Kyle Aristophere T. Atienza

Calaca now a city of Batangas 

MUNICIPAL GOVERNMENT OF CALACA FACEBOOK PAGE

The town of Calaca, Batangas is now a city after residents voted in favor of a conversion law, the Commission on Elections (Comelec) said on Sunday, paving the way for a bigger share in national taxes. 

In a statement, Comelec said 29,424  of 33,205 voters agreed with Calaca’s cityhood, a 56.39% voter turnout for the plebiscite held on Sept. 3.  

Calaca, about 100 kilometers south of Manila, the capital used to be a first-class municipality with a population of 87,361 as of 2020. It is home to the economic zone Phoenix Petroterminals and Industrial Park.  

Calaca is the fifth city in Batangas province after Lipa, Tanauan, Santo Tomas and Batangas City.  

Cities in the Philippines get a bigger share in internal revenue allotment and are generally more autonomous than municipalities. — John Victor D. Ordoñez 

State allots P1-B for Marawi siege victims 

Damaged properties in the aftermath of the Marawi City siege in 2017. — REUTERS

THE GOVERNMENT has allotted P1 billion in next year’s national budget to pay Marawi residents who lost their homes in the 2017 attack by extremists linked to the Islamic State, a congressman said on Sunday. 

Owners of residential and commercial buildings that were damaged or destroyed by the siege will be paid tax-free, Surigao del Sur Rep. Johnny T. Pimentel said in a statement. 

“We expect the compensation payout to rev up reconstruction activities in Marawi by private property owners,” he said. 

A multiplier effect on the economy through job creation that tends to benefit poor households is expected from private rebuilding activities, he added. 

The fund, which is part of the P31-billion calamity fund, will also cover mosques, schools, colleges, hospitals and other health facilities, he said. Also covered are home appliances, jewelry, machinery, rice mills and other expensive equipment. 

The Marawi siege began on May 23, 2017, when military forces set out to capture Isnilon Hapilon, the head of the Abu Sayyaf group, which had pledged allegiance to the ISIS group. 

The five-month siege, which involved heavy gun battles between government and extremist forces, left the central part of Marawi in ruins.   

Mr. Pimentel said 95% of buildings in 24 villages were damaged or destroyed by aerial and artillery bombardment. More than 200,000 Marawi residents fled. — Kyanna Angela Bulan 

Congress asked to prioritize health, education and jobs 

PHILIPPINE STAR/KRIZ JOHN ROSALES

By Kyanna Angela Bulan 

CONGRESS should pass bills on health, education and labor, as well as ban political dynasties, analysts said at the weekend. 

Lawmakers should prioritize bills that will generate more jobs and income so people would want to work rather than rely on the state for aid, Ronald M. Castillo, a professor and political researcher at the University of Sto. Tomas, said in a Facebook Messenger chat.  

He also cited the need to boost science and health management, including pandemics.  

“People act like the coronavirus is gone but it’s not,” he added. The Department of Health has said infections may rise again as more students attend face-to-face classes.  

Meanwhile, Dennis F. Quilala, a political science professor at the University of the Philippines said the government should revisit the K-12 program, which critics said has caused a job and skill mismatch.  

“Our students are not doing well, according to those who measure academic performance,” he said in an e-mail. “This is not good for a country that relies on its manpower for economic growth.”  

Mr. Quilala said people should expect more from the education sector, which received the biggest budget among departments next year at P852.8 billion.  

He also said Congress should once and for all ban political dynasties.   

“The Legislature is mandated to pass a measure against political dynasties,” the analyst said. “Few people monopolizing power are a threat to democracy. It is more difficult to hold elected public officials to account without such a law.”  

Mr. Quilala said passing the bill might be wishful thinking. “I do not think Malacañang would support this measure.”  

“A good Executive branch wants to improve the capacities of its citizens,” Mr. Castillo said. “But a corrupt one will focus on expenses and infrastructure projects. The succeeding months will show which one is which.” 

Duterte’s top envoy named UK ambassador 

DFA.GOV.PH

PRESIDENT Ferdinand R. Marcos, Jr. has appointed the country’s former top envoy as ambassador to the United Kingdom, according to the presidential palace. 

Foreign Affairs Secretary Teodoro L. Locsin, Jr. will also serve as ambassador to Ireland, the Isle of Man, Bailiwick of Jersey and Bailiwick of Guernsey, according to an appointment paper dated Aug. 30.  

Mr. Locsin, who served as Foreign Affairs secretary under ex-President Rodrigo R. Duterte, had spoken against Chinese intrusions in the South China Sea.  

He had cussed at China for failing to reciprocate the Philippines’ goodwill. — Kyle Aristophere T. Atienza 

Senator pushes processing plants for mining 

REUTERS

THE GOVERNMENT should maximize profits from the mining industry by encouraging investors to set up local processing plants, a senator said at the weekend, amid a proposal for a new mining regime.  

“We cannot allow mining companies to just leave the country after the extractive activity is finished,” Senator Maria Imelda “Imee” R. Marcos, who heads the Senate economic affairs committee, said in a Viber message.  

“The mining industry must also invest in local processing plants and be connected to existing local value chains to maximize the return to the local economy,” she added. 

The House of Representatives ways and means committee earlier approved a new fiscal regime that raises the tax rate on the mining sector to 51% from 38%. 

The measure aims to increase government revenue from mining to P37.5 billion in its first full year of implementation.  

Ms. Marcos agreed with the proposal as the country tries to deal with record debt at P12.89 trillion at the end of July.  

“Any move to promote the mining sector and improve revenue generation is crucial given our goal of managing the country’s debt burden while still providing adequate social services,” she said. “Mining is a way to provide employment in the countryside as well.”  

Under the proposal, a royalty of 5% will be imposed on the market value of gross output of large-scale mining operations. 

A minimum government share of 60% of net mining revenue, including all taxes and charges, will also be imposed on all mining operations.  

A 10% export tax will also be levied on the market value of mineral ore exports to encourage domestic ore processing.  

The bill also proposes a government system for the public disclosure of all mining tax and revenue data in the extractive industry value chain.  

“While we understand the need for additional government revenue, our concern is in making sure that we maximize the return to the Filipino people,” Ms. Marcos said. “As such, we would like to ask for a clarification on the application of the 10% export tax of mineral ore, and whether that will be considered part of 60% of net mining revenues.”  

“Such clarification is important to make sure that we provide an incentive for investment in domestic processing plants,” she added. 

Albay Rep. Jose Maria Clemente S. Salceda, who heads the House ways and means committee, said the export tax would be part of the 60% net mining revenues.  

“If they don’t export, then they pay the 60%,” he said by telephone. He expects the incentive to mineral ore exporters to benefit the country because “we’re a major producer of nickel and it’s good for electric vehicles, as well as many conductors.”   

The Philippines boasts the fifth-largest reserves of nickel in the world, according to the US Geological Survey. S&P Global, Inc. said it accounted for a quarter of Asian mined nickel production in 2021.  

The Chamber of Mines of the Philippines has said the bill could set back the revitalization of the industry.  

“We lament the fact that no consultations took place with the industry that would have allowed us to prove that the onerous provisions of the bill would make the Philippine mining industry one of the highest taxed in the world,” it earlier said in a statement.  

“Foreign investors will simply look elsewhere; we are not the only country blessed with mineral resources. If further tax increases are unavoidable, the tax structure should not be onerous as to stop investments from coming in,” it added.  

Mr. Salceda said lawmakers are prepared to discuss the bill with the mining industry and other stakeholders. “We’re just following the pronouncements of the president. The entire driving force for that bill are presidential pronouncements.”  

Finance Secretary Benjamin E. Diokno last month said mining companies could potentially be a key driver of the Philippines’ long-term growth.  

“The mining industry holds the greatest potential to be a key driver in our recovery and long-term growth, especially now that world metal prices are high… We recognize that apart from boosting local development, mining is a strong magnet for investments that can propel our economy into a higher growth trajectory,” he said.  

The Marcos administration is committed to creating an enabling environment that will allow the mining industry to flourish, he added.  

The mining industry should adhere to responsible and sustainable practices, which is a nonnegotiable condition, Mr. Diokno said. — Alyssa Nicole O. Tan 

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