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On the proposed lifting of the constitutional foreign ownership restrictions

The lifting of constitutional limits on foreign ownership proposed by Resolution 2 of both Houses has now been approved by the Lower House committee on constitutional change. Resolution 2 proposes to add the phrase “unless otherwise provided by law” to every restrictive provision.

It has two separate parts:

a.) Substance — will the lifting raise foreign investment inflow and by how much?

b.) Process — could it be implemented in a fashion that keeps political provisions out?

I agree with the substance of Resolution 2 that the lifting of the constitutional limit on foreign ownership will make the Philippines more foreign investment-friendly; but “more” should be understood with caution. The evidence on the response of foreign investment to the lifting of restrictive ownership provisions is still largely cross-country and directional (positive) but not on how much. There is however evidence that for one particular case, the restriction has proven very costly (case below).

By itself alone, the lifting will not create a tsunami of inward foreign investment as often vehemently but gratuitously asserted. The reason is that attracting foreign investment is like attracting hotel clientele: clients are always comparing packages of offerings. If your package is multiply inferior, say, “dirty toilets” on top of “bad air conditioning” on top of “poor safety,” solving just “dirty toilets” will not bring about a flocking of clients. It is only one among the many steps toward a competitive package of features. Advocates of the lifting sometimes treat the public like they were born yesterday by unfounded overselling.

One observation is highly relevant. The investment rate of the country is and has been very low in the past two decades (at best 22% of GDP (gross domestic product) vs. 25-35% among our neighbors). And the Government Capital Outlay (GCO) is lowest in the region (2-4% of GDP vs. 7-10% of GDP among our neighbors). If we are not investing more in our own country, it’s hard to see why foreign investors will do so. That local investors are not “gung ho” though unhampered by the restrictive provisions suggests that other hurdles are as, or even more, important.

The problem of being bottom of mind as an FDI (foreign direct investment) destination in the region has many fathers — foremost among them being: the high cost of power, the high cost of logistics, the number of signatures required and time delays in applications, the uncertainty of the regulatory environment, the weakness in the judicial system and the unsettled peace and order — no question but these concerns come higher in the minds of investors than foreign ownership restrictions. These hurdles will not go away with the lifting.

Furthermore, in the Philippines, the problem of mixed messaging is acute: first, the Corporate Recovery and Tax Incentives for Enterprises (CREATE) bill as approved by Congress will increase the effective income tax on foreign investment because the 5% gross income tax (GIT) to be displaced is equivalent to 17% corporate income tax (CIT) by Department of Finance (DoF) calculation while CREATE proposes a shift to 25% CIT and further on perhaps to 20% CIT. By the way, 17% CIT is the offering to foreign investors in Vietnam.

The appreciating peso (10% in 2020) hit Philippine manufacturers and exporters in 2020 which starkly contrasts with the stability of the Vietnamese Dong to the delight of its export locators. Imposing price controls on pork speaks of the knee-jerk anti-market tendency of the government. Mixed messaging is very damaging to our cause.

That said and to follow up on item 2(a), I will instance, following R. Landingin’s (2007) narration of facts, the cost of Article XII, Section 11 limiting foreign capital of firms to minority status. Arguably the most insidious of red flags about the Philippines as a foreign investment destination in the last two decades starting in 2002 was the PIATCO (Philippine International Air Terminals Co., Inc.) fiasco involving the contract to build Terminal 3 of NAIA (Ninoy Aquino International Airport).

Fraport, the foreign partner in PIATCO, allegedly ponied up most of the money but was relegated by the constitution to minority ownership. For decades after its 2002 delivery, NAIA Terminal 3 was a spanking new $370-million facility lying idle, gathering dust, and earning zilch because it was embroiled in a lawsuit involving the ownership of the facility. No matter who owned the facility, the Coasean bargain would have been to run the facility and focus the legal dispute on its earnings, precisely the recommendation of the Canlas ad hoc committee headed by then-National Economic and Development Authority (NEDA) Secretary Dante Canlas. But then-President Gloria Macapagal Arroyo decided to nullify the contract, handing the matter over to the lawyers. The protracted dispute between the Philippine government and Fraport effectively red-flagged the Philippines as a foreign investment quagmire. Had Section 11 Article XII not been there, Fraport would have had controlling interest and the PIATCO fiasco would not have arisen. In 2013 the Court of Appeals awarded PIATCO $371,426,688 as just compensation. In 2015, the Philippine Supreme Court affirmed the Court of Appeals award which, with interest, had ballooned to P24 billion by 2016. The known cost of Article XII Section 11 on PIATCO alone is staggering. Somebody should have gone to jail.

On Article XII, Section 3 proscribes foreign ownership of land. My personal belief is “To him who can make the land flower best belongs the land.” Citizenship alone does not equip one to make the land flower. Worse, the rape of our national patrimony is the handiwork not only of foreign but also of local passport holders. But foreign investors are not that interested in land ownership; a secure long-term lease is just as good.

Resolution 2 introducing the phrase “unless otherwise provided by law” into specific restrictive provisions makes Congress the final arbiter! This modality is thus contingent on action by Congress which may or may not act. Rep. Edcel Lagman also raised a valid issue on the signaling value of Resolution 2 modality and I paraphrase: This seems a signal of frailty rather than one of resolve. For a stronger signaling, for one more apropos foreign investment and very much less politically contentious (note, no mention of “land”), the Philippines’s cause may be better served by a one-line amendment: Section 11 of Article XII is hereby deleted.

On the process of lifting, the most asked question is: How do the advocates deliver on its promise to insulate the lifting process from non-economic provisions? Rational distrust is the currency of the land at the foothills of another election. As it is, many vocal advocates of the lifting are also lead ideologues of some constitutional political change.

One way to sidestep rational distrust is to offer a “credible commitment” that this won’t happen. A credible commitment is a pledge that is very costly for the offeror to break. An example of credible commitment is the one required by the Mafia of prospective members: Assure us that you will never rat on this family: commit murder. At any rate, anything less will amount to what game theorists call “cheap talk.” Beware of cheap talkers.

 

Raul V. Fabella is a retired professor of the UP School of Economics, a member of the National Academy of Science and Technology and an honorary professor of the Asian Institute of Management. He gets his dopamine fix from bicycling and tending flowers with wife, Teena.

Does the local oil refinery deserve tax incentives?

When the Corporate Recovery and Tax Incentives for Enterprises (CREATE) Bill was passed in the Senate in November 2020, a bicameral conference committee (bicam) was convened, supposedly to iron out differences between the Senate and House versions of the bill.

But after two months of stealthy discussions, CREATE came out of the bicam with completely new provisions which did not exist in either of the Senate nor the House bills. By the time the public got wind of these insertions, both houses of Congress ratified the bill, bypassing any opportunity for public debate.

One particularly controversial insertion is Section 295 paragraph G, a provision exempting local petroleum refineries from paying taxes and duties on crude oil imports. Another provision in Section 296 inserts crude oil refining in the Strategic Investment Priority Plan (SIPP), which outlines the activities qualified to receive incentives.

The secrecy surrounding the bicam proceedings begs the question — what or who prompted these questionable insertions?

Ultimately, the insertion of tax breaks for crude oil refiners can be linked to the precarious state of the last remaining oil refinery in the Philippines, the Petron refinery in Limay, Bataan. The refinery temporarily shut down in January due to weak refining margins. In late 2020, Petron publicly appealed to the government for tax exemptions, warning that the refinery would shut down otherwise.

In a memorandum sent to President Rodrigo Duterte on Feb. 6, House Ways and Means Chair Representative Joey Salceda justified the insertion of tax exemptions for local refineries in CREATE. He argued that the current tax regime disadvantages domestic refiners, imposing higher costs and administrative burdens on the industry as compared to those who import finished petroleum products. Thus, he said that the CREATE provisions on crude oil are simply leveling the playing field by only taxing refined petroleum products after they are removed from the refinery, similar to international practice.

His main argument was that domestic refining is more economically beneficial than importing finished petroleum products, and that closure of the refinery would lead to import dependency. Losing the Petron refinery, he said, would expose the country to a national security threat, as the Philippines does not yet have a strategic petroleum reserve (SPR) managed by the state in case of a national emergency.

Without first considering the merits of the provisions, the manner by which these were included in the final version of the bill is highly questionable. CREATE is not merely a revision of the tax law, but a structural reform that significantly impacts our country’s industrial policy. This is why, for example, the bill only broadly defines what investments may be considered to be strategic and then outlines the process by which any one of these industries may be included in our national plan later on.

Whichever industries our government may deem as strategic must first be scrutinized. Policy makers may identify and propose certain industries to be prioritized, but these must always undergo public debate and discussion, with participation from as many stakeholders as possible.

One underlying principle of CREATE is that fiscal incentives are made transparent and economically justifiable. Last minute insertions made by politicians result not only in an opaque policy process, but in misguided and inferior policies as well.

Perhaps the reason why these insertions were not included in either version of the two chambers of Congress is that these would not have held up under public scrutiny.

The existing fiscal environment is an easy scapegoat to blame for a refinery’s distress or closure, but the hard truth is that local refineries simply cannot “compete with larger integrated end-to-end refineries with petrochemical complexes,” as Finance Secretary Carlos Dominguez III has articulated.

The Philippines has neither the comparative advantage nor the economies of scale to be competitive in oil refining. The maximum productivity of Shell’s recently-closed refinery was around 110,000 barrels per day (bpd) and Petron’s is at 180,000 bpd. In comparison, Singapore’s refineries produce 500,000 to 700,000 bpd; South Korea’s 700,000 to 800,000 bpd; and India’s 1.3 million bpd.

Further, the real constraint faced by local oil refineries is the Department of Energy’s inventory requirement, not the tax regime. To illustrate, the input value-added tax (VAT) of an oil refinery is lower than that of the importer of refined products. The main constraint of the domestic oil refinery is the requirement of an inventory of 60 days’ worth of product, while an importer of refined petroleum needs to maintain an inventory of only 14 days. (In reality, the inventory for the local oil refiners is around 40 to 45 days.) This is not only a larger cost factor than existing taxes, but also renders oil refineries more vulnerable to price squeezes.

However, a larger inventory cuts both ways. Oil, being a commodity, is subject to price volatility. Unfortunately, at a time of reduced demand and oversupply resulting in lower prices, a large inventory translates into higher costs. On the other hand, when oil prices shoot up, a large inventory results in a windfall for the local oil refinery. Petron wants to have its cake and eat it, too.

The reality is that our local refineries are not economically viable. To repeat what Finance Secretary Dominguez said, crude oil refining in the country is uncompetitive, and hence does not deserve tax incentives.

These misguided insertions for Petron will not make its refinery more efficient or scalable, nor are they likely to keep the refinery open in the long run anyway. In fact, due to our archipelagic geography, it is often much cheaper to import petroleum from Singapore to Mindanao, than it is to ship it from Manila to Mindanao. Our irrational fascination with self-sufficiency often comes at the great expense of forgoing sustainability.

Globalization has led to greater integration and interdependence among economies, making it less worthwhile to try to produce everything ourselves at all costs. Especially for oil, as everyone desires a drastic reduction of the carbon footprint, our country must wean itself away from fossil fuel.

Framing this as an issue of national security is a tired argument. Like it or not, oil is almost absolutely scarce in the Philippines.  Even Petron imports its crude oil. The Philippines imports 99% of its crude oil. In this light, the argument of national security by way of protecting Petron flies in the face of reality.

Keeping our remaining oil refinery is more an emotional reaction than it is a sound economic policy. The general consuming public would actually be better off importing cheaper refined petroleum products.

Besides, we must think long-term and realize that the world is moving away from oil — as it should. Demand for petroleum was significantly weakened due to the COVID-19-induced lockdowns in 2020. But even beyond short-term demand shocks, an increasing number of countries are committing to lower their carbon footprint and shift towards renewable energy.

New Zealand, for example, is pushing for renewables so strongly, that it has disincentivized domestic oil production and refining — rendering it practically completely dependent on imports for any of its oil needs. NZ’s sole oil refinery, which produces 135,000 bpd, is already being converted into an import terminal. This kind of decisive policy is what is needed to encourage the development of alternative energy sources, pushing the country ahead of the curve.

Providing tax breaks for oil refining may benefit one company’s bottom line in the very short term, but it is a futile policy which ultimately contradicts the country’s strategic investment priorities.

 

AJ Montesa is an economic policy analyst and Pia Rodrigo is the communications officer of Action for Economic Reforms.

Russia has been the Sputnik vaccine’s worst enemy

“IT IS GUARANTEED safe and effective,” says a voice with what’s probably meant to be a heavy Russian accent. “How do we know? Because it was tested on a bear, by a scientist who is also a bear.” This is an excerpt from a September edition of The Daily Show, and the subject was the Russian COVID-19 (coronavirus disease 2019) vaccine, Sputnik V. It hasn’t aged well: Now that a peer-reviewed article in The Lancet has established Sputnik as safe and effective, the initial failure of many countries to believe in it looks like a missed opportunity.

The list of countries ordering the Sputnik vaccine is now growing. But given that Russia approved Sputnik back in August, long before any other vaccine got the green light, why didn’t it achieve wider use more quickly? Why didn’t the European Union, which faces a massive vaccine shortage, order it along with other vaccines which also weren’t yet approved when the orders were being made?

There’s a simplistic answer to these questions: Because the West believes its own propaganda. All that bear stuff — can you imagine a 2020 US TV program mocking Chinese or Indians in that way, fake accent and all? As Thomas Friedman recently declared in the New York Times, “The only Russian exports that appeal to Westerners are caviar, vodka, and nesting dolls — and we’re full up on all three.” Such stereotypes — the “gas station masquerading as a country” trope, the notion that progress bypassed post-Soviet Russia and it still subsists on hoary Soviet scientific and technological achievements — make it hard to believe that Russia is capable of producing a genetically engineered vaccine that’s easier to store and transport and cheaper to produce than the universally recognized Pfizer vaccine.

But then, the whole idea of fighting COVID-19 rests on listening to experts. And the experts knew that no bears were involved in Sputnik V’s design. Its chief developer, Denis Logunov, is a much-published, respected microbiologist — and he’s only 42, not a Soviet-era dinosaur. In 2016, he and a team from his research center, the Gamaleya National Center of Epidemiology and Microbiology, were responsible for the development of an Ebola vaccine, which is cleared for use in Russia and has shown a good efficiency level in tests — even as two other Western-developed vaccines have been approved for use in Africa and the Russian one still hasn’t. More recently, the team worked on a vaccine against the Middle East Respiratory Syndrome (MERS), caused, like COVID-19, by a coronavirus. Because of their Ebola and MERS experience, Logunov and his team were ahead of many others when the COVID-19 pandemic broke out. They used the same approach — it was “literally copy and paste,” Logunov explained in a rare interview with the Latvia-based website Meduza last year.

In other words, the right people knew the Russian vaccine effort was as serious as any other. And yet that knowledge didn’t translate into acceptance and orders.

The likely reasons for that go well beyond the stereotypes of Russia as a backward country. It’s not because of what Russian propaganda likes to call “Russophobia” that the Russian Ebola vaccine fell behind others, not because of stereotypes that Sputnik V squandered its development lead, or that the MERS vaccine will likely encounter the same lack of uptake (even though no competing products have been approved for that virus, either).

The main problem has been that the Gamaleya Center is a state-funded, state-owned organization. The Russian state handles everything except the actual vaccine development. Like many Russians, Logunov has decided (and said so in the interview) that his narrow area of expertise is his only concern. But for a state enterprise, business strategy always comes a distant second to political considerations. That is why Sputnik, despite being a development success, has been a production and distribution failure: Russia, the biggest country to have approved it, lags far behind others in doses administered, though since December, it has striven to make the vaccine available to all regardless of age.

The marketing fiasco began when Russia rushed Sputnik’s approval. Most countries have cut bureaucratic corners and taken risks when it came to adopting anti-COVID medications, but the Russian announcement — the first in the world! — came when even the experts familiar with Logunov’s work couldn’t help but doubt that the vaccine was safe to use. Questions ensued that only further testing and peer review could eliminate; by the time the definitive Lancet article came out, it was already February 2021.

While the private pharmaceutical companies also involved in the vaccine race were quietly applying for the necessary approvals in major markets, getting regulators to speed up the process and talking behind the scenes to government customers about prices and supplies, the Russian government was busy trumpeting its world-beating success — and hurting Sputnik’s chances of access to major markets. With their enormous lobbying resources, companies such as Pfizer and AstraZeneca knew exactly what to do to get results; the Russian propaganda apparatus was more interested in making noise, and possibly, dare I suggest it, in getting rejected: The Russophobia narrative is the air it breathes.

Another big error was to involve Russian President Vladimir Putin in the marketing. It’s not just that he has dissembled so much that few people are willing to take his word for anything; it’s not that Western governments are reluctant to grant him any kind of victory; while trumpeting Sputnik’s supremacy, he has not been seen receiving a jab himself, and that would have disqualified him as a salesman under any circumstances.

So, time was wasted on undermining Sputnik’s credibility instead of raising it. That, in turn, made it harder to ramp up production. Gamaleya has its own manufacturing, and a couple of Russian companies have been allowed to make Sputnik under license, but broad international distribution is only possible if local production partners are found in the countries that approve the vaccine for use. Few such deals were approved ahead of the Feb. 2 Lancet article, and it’s unclear whether the Russian Direct Investment Fund (RDIF), which handles Sputnik V as a business project, used the time it had to make sure the supply chain was scalable; its head, Kirill Dmitriev, warned of possible delays in the planned ramp-up because of supply complexities.

The RDIF is supposedly business-oriented, but it’s a sovereign fund that’s an arm of the Russian government. Instead of opening doors to the vaccine, it closes them except in the most anti-Western or the neediest of countries such as Iran or Nicaragua. It’s one thing to buy a Russian-developed product, but another to deal directly with the Putin regime. Dmitriev said earlier this month that getting approval in big Western markets is “not a priority” because of the “obvious political constraints of working with Russia.” But if the difficulties were that obvious, why wasn’t the international distribution farmed out to a private entity as far removed from the government as possible — unless, again, the goal was not to achieve widespread success, but to create a distribution map that would illustrate how the West shuns Russia even as the rest of the world is willing to deal with it?

In other words, even as the Russian government funded the development of a highly effective, highly competitive vaccine by the first-class brains that, pace Thomas Friedman, are not rare in Russian research institutions, its heavy-handed politicized bungling of marketing and distribution has, in effect, held back its global success. As a resident of Germany, I’m angry at the German government for its failure to secure an adequate supply of COVID vaccines — but I’m not angry at it for missing its chance to sign up for Sputnik: Russia’s “sales effort” made it an easy proposition to refuse.

BLOOMBERG OPINION

Senate’s acquittal fails to erase Capitol riot from Donald Trump’s legacy

EVEN after winning acquittal in his second Senate impeachment trial, former President Donald Trump’s legacy will remain scarred by the deadly attack that his loyalists waged on the US Capitol.

Democrats used vivid, previously unreleased footage to cement Mr. Trump’s role in sparking the riot to ensure the insurrection hangs over Mr. Trump’s political future. Seven Republicans voted to convict him, but the former president is reveling in the enduring loyalty of the Republican Party, which showed it isn’t ready to quit him.

Mr. Trump celebrated the result, saying he is charting his political future, but it’s unclear how Republicans will approach him in the coming months. The GOP remains leery of alienating his many fervent supporters and state parties are fiercely defending him, but polls show that more than half of Americans think Mr. Trump should be barred from serving in office again.

“While the final vote did not lead to a conviction, the substance of the charge is not in dispute,” President Joseph R. Biden said in a statement late Saturday. “This sad chapter in our history has reminded us that democracy is fragile. That it must always be defended.”

Few of the 43 Republicans who voted to acquit Mr. Trump on Saturday defended his actions, and Senate Republican Leader Mitch McConnell delivered an extraordinary rebuke of the most popular figure in his own party, seeking to ensure Mr. Trump will be inextricably tied to the riot.

“A mob was assaulting the Capitol in his name. These criminals were carrying his banners, hanging his flags, and screaming their loyalty to him. It was obvious that only President Trump could end this. He was the only one who could,” Mr. McConnell said on the Senate floor. Yet he didn’t, even though Mr. McConnell noted Mr. Trump knew Vice President Mike Pence was in danger.

He also noted Mr. Trump faces potential ongoing legal scrutiny. “He didn’t get away with anything yet. Yet,” Mr. McConnell said. “We have a criminal justice system in this country. We have civil litigation.”

Senate Majority Leader Chuck Schumer also hammered home the idea that Mr, Trump will forever be remembered for the events of Jan. 6 that left five people dead.

“Let it live on in infamy, a stain on Donald John Trump that can never, never be washed away,” the New York Democrat said.

TRUMP ‘SUPERPOWERS’
But Mr. Trump made it clear minutes after the vote that he plans to waste no time turning the acquittal to his political advantage.

Mr. Trump issued a statement vowing that the “historic, patriotic and beautiful movement to Make America Great Again has only just begun.” He said he will “have much to share” in the months ahead and decried the latest attempt to punish him as “yet another phase of the greatest witch hunt in the history of our country.”

Mr. Trump is dangling the possibility that he will seek office again in 2024 and help Republicans retake control of Congress in 2022 by challenging any GOP candidates he believes were disloyal to him in the impeachment process or the election aftermath. He will likely also support primary challenges against the 10 House members who voted to impeach him and the seven senators who voted to convict him.

His oldest son, Donald Trump Jr., tweeted after the verdict, “Let’s impeach RINOs from the Republican Party,” a reference to the term Republicans In Name Only.

There is ample evidence that his messaging strategy — that he survived three “witch hunts,” including the Russia investigation and his first impeachment for seeking election help from the Ukrainian president — will bolster his standing with core supporters who relish seeing him beat the establishment.

The leaders of the Republican National Committee and many state parties remain loyal to him and support candidates like him even though the trial showed stunning acts of disloyalty to lieutenants like Pence and House Minority leader Kevin McCarthy. After Saturday’s vote, the Louisiana state GOP executive committee voted to censure GOP Senator Bill Cassidy for his vote to convict Mr. Trump.

The acquittal means that Democrats have now made Mr. Trump a martyr, said Brad Parscale, Mr. Trump’s former campaign manager.

“They are about to give him superpowers,” Mr. Parscale tweeted on Feb. 6 before the start of the Senate impeachment trial.

Some Republican strategists say Mr. Trump’s efforts to overturn the results of the Nov. 3 election and the ensuing Capitol attack will overshadow his stunning rise to power and his achievements such as the 2017 tax law or reshaping the federal judiciary, including three new Supreme Court justices.

Ed Rollins, a veteran GOP strategist who runs the pro-Trump Great America Political Action Committee, likened it to Lyndon Johnson passing landmark civil rights legislation but being defined by Vietnam, or Richard Nixon opening diplomatic relations with China but being remembered for Watergate.

“Certainly it’s going to be the first paragraph or two in his obituary and the historical annals,” Mr. Rollins said of the riot. “Historically, it’s going to be very damaging. And obviously as someone who supported him, I’m saddened by all that, but it’s real.”

Mr. Trump ended his term with the lowest job approval of his presidency, 29%, amid a surge in negative sentiment about his post-election conduct, according to a January survey by the Pew Research Center. And 68% of Americans don’t want him to remain a major political figure, according to the January 8-12 survey of 5,360 US adults.

Yet a full 57% of Republican or Republican-leaning voters in the same survey said he should continue to be a major political figure for years to come, and 64% of those voters say he either definitely or probably won the 2020 election he falsely claimed was stolen.

Charlie Cook, editor and publisher of the nonpartisan Cook Political Report, said he doesn’t expect the riot and impeachment will matter to Trump loyalists because what happened at the Capitol was consistent with the former president’s past behavior.

“It was an unbelievable event, but we’ve been seeing unbelievable events ever since the man came down the escalator at Trump Tower,” Mr. Cook said, referring to Trump’s 2015 campaign kick-off when the country got the first taste of his rhetoric, with him saying Mexico was sending rapists and criminals as immigrants to the US.

Mr. Trump still enjoys an intensely loyal base and the vote to acquit highlighted elected officials’ fear of angering them. A NBC News poll after the insurrection showed that Republican voters were evenly split — 46% to 46% on whether their loyalty was first with Mr. Trump, or the GOP.

The Jan. 6 insurrection should have allowed the Republican Party to break from the former president, said Evan McMullin, a former chief policy director to the Republican Conference who has been trying to engineer a breakup between the party and Mr. Trump since running against him as an independent in 2016.

Mr. McMullin and 120 Republican leaders and disaffected voters have discussed forming a new party or faction to change the direction of the GOP. He said while the insurrection would ordinarily spell the end of any Democratic leader, it’s clear that a strong majority of the Republican Party still backs Mr. Trump.

Mr. Trump’s statement Saturday made clear he plans to use that support.

“We have so much work ahead of us, and soon we will emerge with a vision for a bright, radiant, and limitless American future.” — Bloomberg

EU to speed approval of variant-modified coronavirus vaccines

FRANKFURT — The European Union (EU) will fast track approvals of coronavirus vaccines adapted to combat mutations, the bloc’s Health Commissioner Stella Kyriakides said in a newspaper interview on Sunday.

“We have now decided that a vaccine that has been improved by the manufacturer on the basis of the previous vaccine to combat new mutations no longer has to go through the entire approval process,” she told Bavaria’s Augsburger Allgemeine.

“So it will be faster to have suitable vaccines available without compromising on safety.”

The European Commission has come under fire from EU member states over delays to deliveries of vaccines which has seen the bloc lag behind countries such as Britain, a former member, and the United States.

Ms. Kyriakides is a member of a new task force, led by Industry Commissioner Thierry Breton, to eliminate bottlenecks in production plants and adjust output to new variants.

While vaccinations in the first quarter of 2021 have started slowly, the second quarter would see a pick-up and by the end of September the EU expects to have received sufficient doses from licensed producers to cover over 70% of its population, Ms. Kyriakides said.

She also reiterated the Commission view that closing borders was not an effective weapon against infections.

“I think it is wrong for us to return to a Europe with closed borders, as in March 2020,” she said.

Germany will enforce entry bans on travelers from the Czech Republic and Austria’s Tyrol region from Sunday to prevent the spread of new variants. — Reuters

Gilas Pilipinas set to add players to its pool from PBA rookie draft

By Michael Angelo S. Murillo, Senior Reporter

THE Philippine national men’s basketball team is set to add players to its pool from the rookie draft of the local professional league set for March.

Following its meeting with the Philippine Basketball Association (PBA) last week, the Samahang Basketbol ng Pilipinas (SBP) submitted a list of players it is interested in tapping to be part of the national team program in preparation for future international competitions.

The local basketball federation said it will be picking Jordan Heading, Tzaddy Rangel and Jaydee Tungcab from the special PBA rookie draft for Gilas on March 14.

The three players will join Isaac Go (Terrafirma), Matt Nieto (NLEX), Mike Nieto (Rain or Shine), Rey Suerte (Blackwater), and Allyn Bulanadi (Alaska), Gilas draftees in 2019, as full-time members of the Gilas Pilipinas pool.

The pool is part of the long-term plan of the SBP to ready the national team for international competitions, particularly the 2023 FIBA World Cup where the Philippines is one of the hosts along with Japan and Indonesia.

Mr. Heading is a 6-foot-2 guard from the California Baptist University and a product of the Batang Gilas program, while Mr. Rangel is a 6-foot-8 bruiser from the National University.

The two were teammates under San Miguel Alab Pilipinas in the ASEAN Basketball League.

Mr. Tungcab is a 6-foot-3 guard from the University of the Philippines (UP), who was supposed to play as an Asian import in the Japanese B. League before new strains of the coronavirus derailed it.

He is no longer a stranger to Gilas being part of the cadet squad that saw action in the second window of the International Basketball Federation (FIBA) Asia Cup Qualifiers last year.

The three are among the record of 97 players who have applied in the PBA rookie draft.

“We thank the three for their trust and commitment to the program. Over a short span, we’ve seen the development of the program and of the players’ individual talents as well and we’re confident that the upcoming Gilas draftees will benefit greatly under Program Director Tab Baldwin and his outstanding staff of coaches,” said SBP President Al Panlilio in a statement.

FIBA ACQ WINDOW BACK IN CLARK
Meanwhile, Clark City in Angeles, Pampanga, is back as host of the FIBA Asia Cup Qualifier third window.

Following the decision of FIBA last week to cancel the event in Doha, Qatar, because of the rising cases of the coronavirus there, the SBP stepped up anew and offered the Philippines as venue for the qualifying leg of the regional tournament.

It is actually a re-hosting for the country as it was originally set to host the third and final window this week until SBP decided to pull the plug late last month over concerns on the new strains of the coronavirus and heightened restrictions by the government because of them.

Qatar offered itself as host until the country, too, decided to drop out.

In Doha, three groups were set to play, namely A, B and E, from Feb. 17 to 23.

“The Qatar Basketball Federation was there to help out when we could not push through with our hosting and it’s just right for the SBP to be here for them and for FIBA as well,” said Mr. Panlilio in a separate statement.

“What we have to remember during these difficult times that the entire international basketball community is part of one team. We must do our best to help each other as much as we can. We know that our great fans from all over Asia draw a lot of inspiration from their respective national teams and this is why hosting these games holds a lot of value even during a pandemic,” he added.

In communication with FIBA, the SBP said it was decided that two groups will be playing in the Philippines and one group in Lebanon.

The schedule and logistics are currently being finalized.

Gilas Pilipinas currently leads Group A with a 3-0 record. Other teams part of the grouping are Korea (2-0), Indonesia (1-2), and Thailand (0-4).

Chot Reyes makes PBA coaching comeback with TNT

EIGHT-TIME Philippine Basketball Association (PBA) champion coach Chot Reyes is back in the league with the TNT Tropang GIGA.

Mr. Reyes, 57, was announced at the weekend to take the head coaching duties for Smart Communications’ pro basketball team when the new PBA season unfurls later this year.

It will be a homecoming for the five-time PBA coach of the year and former Gilas Pilipinas bench tactician with the franchise, which he helped win four league titles, the last one in the 2011-2012 season (Philippine Cup). “It’s like a homecoming for Chot. He is a coach that gave us four championships. We look forward to a successful relationship with Coach Chot,” said Ricky Vargas, team governor and chairman of PBA Board of Governors, in a statement.

Mr. Reyes takes over from TNT active consultant Mark Dickel, who ran the team along with coach Bong Ravena for the last couple of years.

Mr. Dickel was asked to stay with the team, but declined the offer to look for new opportunities elsewhere.

In making a return to the PBA, Mr. Reyes, who was TV5’s top executive until 2019, expressed his excitement to be doing something he is truly passionate about.

“Throughout my career, I have always tried to live according to my passion and purpose. My passion has always been coaching and building teams, whether in sports or business. And my purpose is to further the advancement of Filipino coaches, so we can, in turn, help develop the next generation of Filipino leaders,” said Mr. Reyes.

“Coaching again in the PBA provides me an excellent platform to advance this advocacy. I have spent the best years of my career as a ka-Tropa, and I look forward to this new challenge,” he added.

With TNT, Mr. Reyes will lead a team bannered by veteran Jayson Castro, Roger Pogoy, Ray Parks Jr., Troy Rosario, and JP Erram.

Mr. Reyes started his PBA head coaching career with the Purefoods franchise in 1993. He also had stops with Sta. Lucia, Pop Cola, Coca-Cola, and San Miguel. — Michael Angelo S. Murillo

WNBL successfully holds first-ever player draft; Cainglet selected first

THE newly recognized professional association Women’s National Basketball League (WNBL) added another milestone in its development by holding its first-ever player draft at the weekend.

Done virtually last Saturday, 39 players were selected from a pool of 177 aspirants by teams, which are expected to compete this year in the first season as a pro of the WNBL.

Leading the roster of players drafted was former University of the Philippines standout and now-doctor Fille Claudine Cainglet, who was selected first by the Glutagence Glow Boosters in the draft presented by Chooks-to-Go and powered by Smar.

A 5-foot-2 guard, Ms. Cainglet, 32, played for the Fighting Maroons at the University Athletic Association of the Philippines (UAAP) from seasons 69 to 73.

Ms. Cainglet was performing an operation at the University of the East Ramon Magsaysay Hospital in Quezon City as she followed the draft and heard of the news of her selection.

Joining Ms. Cainglet in the Glow Boosters are the “Splash Sisters” Camille Claro and Khate Castillo as they were Glutgence’s back-to-back picks in rounds two and three.

The rest of Glutagence’s picks were 5-foot-10 center Camille Sambile of Far Eastern University, 5-foot-10 big April Lualhati of Lyceum, 5-foot-7 forward Nic Cancio of Ateneo, 5-foot-10 center Carol Sangalang of University of Santo Tomas, 5-foot-6 guard Raiza Palmera-Dy of FEU, 5-foot-2 point guard Nicky Garcia of La Salle, 5-foot-4 forward Samantha Tan of UP, 5-foot-4 guard Ays Hufanda of UP, and 5-foot-1 guard Camille Ramos of La Salle.

STAN Quezon, meanwhile, picked up Dianne Ventura, Kat Araja, Jo Razalo, Angelica De Austria, Karla Manuel, Nikka Tupaz, Jade Valenzuela, Marika Iida, Veronica Lio, and Bienca Ramos.

Despite entering the draft at round three, Pacific Water was still able to nab burly forward Snow Peñaranda. It, too, was able to draft UAAP Season 82 Finals MVP Monique Del Carmen in the ninth round.

The Queens also got Cara Buendia, Elaisa Adriano, Crislyn Mier, Tin Cortizano, Nef Taller, Janella Alba, and Jinky Balasta.

Parañaque, an original from the first season of the WNBL, for its part, was able to make the most of their eight picks, selecting AJ Gloriani, Mary Joy Galicia, Jhenn Angeles, Vanessa Santos, Tanya De La Merced, Jenina Solis, Sthefanie Ventura, and Jaira Baarde.

In the lead-up to the draft, all the teams were given a chance to “protect” at most seven players, who would not go through the draft.

The WNBL was recognized as a pro league last year after getting its license from the Games and Amusements Board (GAB).

The league hopes to provide a platform for women players to showcase their skills and share their passion for basketball long after their collegiate careers are over.

Saturday’s draft was supervised by GAB, with its chairman Baham Mitra gracing the event. — Michael Angelo S. Murillo

Naomi Osaka survives Gabby Muguruza scare

MELBOURNE — Naomi Osaka saved two match points as she battled back from the brink to reach the quarter-finals of the Australian Open with a (4-6, 6-4, 7-5) victory over in-form Garbine Muguruza on Sunday.

The Japanese third seed was chasing the match from the start on Rod Laver Arena and looked defeat square in the face in the third set when the Spanish 14th seed had two opportunities to win the match with a break of serve.

Osaka saved both match points — the first with an ace — to turn the tide in the contest decisively and Muguruza exited the tournament a couple of games later after failing to win a point in her final service. — Reuters

Timberwolves latest NBA partner of Tanduay

ADD the Minnesota Timberwolves to the growing list of National Basketball Association (NBA) teams, which have partnered with Philippine rum maker Tanduay.

In an announcement made last week, Tanduay said the Timberwolves were the latest NBA club it has been privileged to link up with as it takes its brand to more territories.

Tanduay also has existing partnerships with the Golden State Warriors, Brooklyn Nets, and the Milwaukee Bucks.

Under the deal with the Wolves, Tanduay will have TV-visible courtside rotation LED and basket pad LED signage, pole pads, and arena signage bearing its iconic name and logo.

Custom Timberwolves-Tanduay co-brand packaging for rums will also be released in Minnesota.

“As a global brand, we love bringing the world closer together, having fans experience flavors or products they haven’t tried before and offer something we know they’ll love,” said Ryan Tanke, Chief Operating Officer of the Minnesota Timberwolves and the Minnesota Lynx, of their decision to partner with Tanduay, in a statement shared by the Filipino rum manufacturer.

For Tanduay, its touts its partnerships with NBA teams as built on the shared culture of striving for excellence and fostering loyalty in the communities they serve.

“As we expand into new markets, we also create new relationships with organizations that share our commitment to bringing the best to our consumers. We are proud to have found that partner in the Minnesota Timberwolves,” said Tanduay President and COO Lucio Tan III.

Last year, despite the challenges presented by the pandemic, Tanduay was declared the World’s Number 1 Rum by Drinks International for the third consecutive year. It was also awarded “Brand of the Year” in the rum category by the Global Advisory Council of the World Branding Forum for the sixth consecutive year. — Michael Angelo S. Murillo

Barcelona rout Alavés to fire warning shot to PSG

BARCELONA — Lionel Messi scored with two scorching strikes as Barcelona hammered Alavés (5-1) on Saturday in La Liga to warm up for their upcoming Champions League clash with Paris St. Germain (PSG) in style.

Portuguese forward Francisco Trincão put Barça in front after a cut-back from 18-year-old debutant midfielder Ilaix Moriba and Messi thought he had doubled the lead later on when knocking in on the rebound, but the goal was ruled out for a marginal offside against Antoine Griezmann.

Messi then took matters in to his own hands from outside the area and thumped the ball off the far post with such venom that it landed just inside the opposite post.

Alavés’s Luis Rioja pounced on a mistake by Ilaix to reduce the deficit in the second half, but Barça came roaring back with a second strike from Trincão, another long-range missile from Messi and then a fifth goal crafted by Messi and Griezmann and finished off by left back Junior Firpo.

A seventh consecutive league win took Barça up to second in the standings on 46 points, eight behind leaders Atletico Madrid.

“Messi is in a fantastic moment of form,” said Barça coach Ronald Koeman.

“We know how decisive he is and right now he is in the mood. With him playing in this form, everything is easier. If we want to beat PSG, we need Leo and everyone else at the top of their game.”

Barça had suffered a painful 2-0 defeat to Sevilla in Wednesday’s Copa del Rey semifinal first leg and Koeman rotated his side to make for fresher legs for Tuesday’s first leg at home to PSG.

He rested Jordi Alba and started without Sergino Dest, Ousmane Dembele and Pedri, but there was no rest for Messi, who unleashed a ferocious shot for his first goal.

He also sparked the move for Barça’s third goal, racing on to a through ball and attempting to round keeper Fernando Pacheco, who succeeded in snuffing out Messi but could only parry the ball into the path of Trincão, who tucked it into the net.

Messi was hungry for a second goal of his own, however, and got one less than 60 seconds later, dribbling past two defenders outside the area and rattling a left-footed shot into the far corner.

Now toying with his prey, he released Griezmann with a delicious chipped pass and the Frenchman sent in a low cross for Firpo to complete the thrashing.

Koeman expressed his satisfaction with the team’s performance after making several changes and said they were feeling confident ahead of Tuesday’s showdown against PSG, who will be without an injured Neymar.

“We believe we can get through the tie. They have some injuries, but so do we, and we’ll have to play very well to knock them out,” added the coach.

“We have to be more efficient than ever in attack and strong in defense. I’m sure it’ll be a marvellous game.” — Reuters

Jordan Spieth expands lead to two shots at Pebble Beach

DESPITE finishing just one under par on the day, Jordan Spieth managed to hold on to his lead and even separate himself slightly from the pack on Saturday at the AT&T Pebble Beach Pro-Am in Pebble Beach, California.

As the tournament moved exclusively to Pebble Beach Golf Links for the weekend, Spieth capitalized on his second hole-out eagle of the tournament — a 160-yard shot from the fairway on the par-4 No. 16 — to shoot 71 and move to 13-under 203, good for a two-shot lead over a five-pack of players.

The players tied for second place at 11 under are Nate Lashley (68 on Saturday), Tom Hoge (68), Patrick Cantlay (70), Daniel Berger (72), and Scotland’s Russell Knox (69).

Hot on their heels at 10 under and tied for seventh place are Australia’s Jason Day (68), Brian Stuard (69), Maverick McNealy (69), and England’s Paul Casey (71).

The 27-year-old Spieth, coming off his best result in nearly a year, tied for fourth place in the Waste Management Phoenix Open last week. It was his first top-10 finish since he tied for ninth at Pebble Beach in 2020 and his first top-20 result since the Memorial last July.

It was a tale of two nines Saturday for Spieth, who won the 2017 Pebble Beach event for one of his 11 career PGA Tour victories, but hasn’t been victorious since claiming the 2017 Open Championship. After a bogey on No. 2, he rebounded with birdies on Nos. 4, 6 and 9 before giving them all back with bogeys at Nos. 10, 12 and 14.

Then came the eagle at No. 16.

Spieth said of his 8-iron shot that landed in the cup, “In the air I thought it was going to be really good, it was one of the only shots I kind of said, ‘Oh, be good.’ And as it landed it was just exactly where I was trying to hit it, certainly a bonus for it to drop… It’s a good lesson to learn for tomorrow: how quickly things can change out here.”

“It’s just Jordan doing Jordan things,” Berger said regarding his reaction to seeing Spieth hole out.

Spieth said of his current mindset, “I’m finally consistently doing things over the last two weeks that I’ve wanted to do for a long time. I think, obviously the more you continue to do that, the bounces go your way, like the hole out did today on 16.

“Someone may do that to me tomorrow or come shoot a 64 or something. I mean, it’s golf, and it’s Pebble Beach, and you can go low, and it can also be really challenging… What I’m asking for is a chance to win the golf tournament on 18.”

Berger was tied with Spieth at 13 under going into No. 18, but dropped two shots with a double bogey and finished even par for the day.

Kevin Streelman shot a bogey-free 67 to record the low round of the day. He started on the back and notched four birdies before posting one more after the turn, and he is tied for 13th place at 8 under.

Defending champion Nick Taylor of Canada posted an even-par 72 and is tied for 34th at 4 under. — Reuters

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