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Senate backs separating measures for financial industry from Bayanihan II legislation

THE SENATE prefers to legislate pandemic relief measures specific to financial institutions separately from the Bayanihan II bill, as opposed to the House of Representatives’ more integrated proposal, Senator Grace S. Poe-Llamanzares said at an online briefing Wednesday.

The Bicameral Conference Committee is now reconciling versions of the Bayanihan to Recover as One Act, also known as Bayanihan II, under House Bill No. 6593 and Senate Bill No. 1564. The bill is a pillar of the government’s stimulus plan.

Provisions that need to be harmonized in conference committee were the inclusion of key features of the Financial Institution Strategic Transfer (FIST) and Government Financial Institutions Unified Initiatives to Distressed Enterprises for Economic Recovery (GUIDE) bills in the House version.

“That is actually a point of contention between some members of the House and the Senate,” Ms. Poe-Llamanzares said.

“This is very bank-specific. What we did instead and this is the suggestion of the Senate… is not to include FIST and ARISE in Bayanihan 2,” she said.

Ms. Poe-Llamanzares noted that the panel will tackle the FIST provision today, adding that she hopes to conclude meetings in time for ratification next week.

The GUIDE bill calls for the creation of an entity to be known as Accelerating Recovery to Intensify Solidarity and Equity, Inc. (ARISE, Inc.) which will assist companies address solvency issues. The FIST bill allows for the transfer of bad loans to asset management companies, in order to keep banks healthy.

Ms. Poe-Llamanzares is  a member of the panel and chairs the Senate Banks and Financial Intermediaries committee.

She added that while the Senate wants a separate bill for financial institutions, the chamber supports an injection of P50 billion to the Land Bank of the Philippines and the Development Bank of the Philippines for lending to micro, small, and medium enterprises.

Asked how the government will fund the other measures, Ms. Llamanzares said “Yesterday, when I was discussing this…, if we’re going to have a separate bill, will we have money for that? The answer of some of our colleagues was the DoF wants this bill to happen, so they will find money for that.”

The panel has also agreed that there will be no jeepney phase out during the pandemic.

Funding will be allocated for the service contracting of public utility vehicles, granting of allowances to  displaced drivers and fuel vouchers to other affected drivers.

Bayanihan II will grant special powers to President Rodrigo R. Duterte to realign items in the 2019 and 2020 national budget for the coronavirus containment effort. — Charmaine A. Tadalan

Pandemic side businesses driving digital banking shift — UnionBank

NEW SIDE businesses that emerged during the pandemic are leading the charge in adopting digital payments, UnionBank said.

“People have now become chefs and bakers and selling on Viber and Facebook groups,” Ana Maria A. Delgado, the bank’s chief customer care experience officer and an executive Vice-President, said in an online briefing Wednesday.

Among more established e-commerce businesses, “We’ve also seen the emergence of livestream selling where you are using videos to explain products further and get people to interact,” she said.

She added these trends are part of a broader shift in consumer behavior during the coronavirus disease 2019 (COVID-19) pandemic.

“For example, you might have held face-to-face events and have a captive audience for an hour. Now on digital, people are more distracted by other things, right? So what you would have said in an hour, you now need to say in maybe 10 minutes,” she said.

People staying at home have been relying more on digital bank transactions.

Ms. Delgado said UnionBank online transactions have since surpassed in-branch dealings by a wide margin, which she quantified as “in the millions.”

She added that a partnership with the 7-Eleven chain of convenience stores which allows cash-in transactions to UnionBank has gained traction not only for personal purposes but also for business transactions. The bank is also exploring allowing cash-out withdrawal transactions through 7-eleven stores.

During the lockdown, UnionBank launched an app to allow money transfers to remittance centers.

UnionBank’s net profit declined 26.9% to P1.86 billion in the second quarter on increased loan provisions. In the first half, net earnings fell 5.6% to P4.5 billion.

UnionBank finished trading at P54 Wednesday, gaining five centavos or 0.09%. — Luz Wendy T. Noble

Increased joblessness expected to pressure insurance premiums

THE INSURANCE industry will likely take a hit from rising unemployment as jobless policyholders direct their money to other needs instead of staying current on their premiums.

The industry is bracing for a wave of clients abandoning their policies after losing their jobs, Singapore Life (Singlife) Philippines President Rien Hermans in an interview last week.

In the Philippines, Mr. Hermans said many Filipinos buy insurance products as a way to save up for future needs such as education and retirement, or to build up investments through variable universal life insurance products.

“You can imagine that if you lose your job, you don’t have money coming in… so people may surrender their policies to get the money, so that will be a big challenge for insurance companies,” Mr. Hermans said.

The unemployment rate rose to 17.7% in April from 5.1% a year earlier, equivalent to 7.25 million out of work, compared with 2.27 million in April 2019.

He said another challenge is that insurance agents cannot hold meetings or attend events and conventions to sell products as mass gatherings are still banned, while clients are still wary of going out because of the virus.

However, he said companies like the fully-digital Singlife Philippines are in a more favorable position as clients are now becoming more open to the use of technology.

He added that the sector should be “okay” even with some uptick in claims given the nature of the business while investments should still provide some returns as insurers are required by law to hold safe investments like government bonds.

“Looking at the longer term, the challenge would be how quickly is the economy bouncing back,” he said.

“Driven by the demographics, young educated population, and the ambition to make the economy one of the fastest-growing in Asia, I think we will get back (to a growth trajectory) and that also means that people would want more insurance. They will put money away for their kids’ education or set up a business,” he added.

Singlife Philippines hopes to introduce its flagship insurance savings plan, known as “Singlife Account,” by early next year.

Its initial products will be launched this year through the mobile wallet firm GCASH.

It obtained its license from the Insurance Commission in February to become the first fully digital life insurance company in the country. Its target is 500,000 clients in the next five years. — Beatrice M. Laforga

ERC reports more participation in retail power market

THE Energy Regulatory Commission (ERC) said the pandemic’s “silver lining” is that more contestable customers are joining the retail electricity market, where prices are also falling.

In the second quarter, the commission noted a 2% rise in the number of buyers with over 750 kilowatts of consumption in the contestable retail electricity market (CREM), though they contracted less power as the pandemic affected their operations.   

The weighted average price in the market is falling, with June at P3.95 per kilowatt-hour (kWh), down from May’s P3.97/kWh and April’s P4.12/kWh. Over the period, 11 retail electricity suppliers offered lower rates, while seven raised their prices and 14 maintained theirs compared with the previous quarter.

“This positive development stimulates competition among retail electricity suppliers and will entice more contestable customers to shift to these electricity providers”, ERC Chairperson and Chief Executive Officer Agnes VST Devanadera said in a statement Wednesday.

The market posted 4,977.31 MW of electricity demand from all contestable customers between April and June, with 81% being delivered by retail electricity suppliers. The rest was met by distribution utilities.

The market is “slowly breaking the monopoly in the supply of electricity,” which “gives confidence that electricity supply is ensured and that they have the capability to offer competitive or cheaper prices in the CREM.”

Meanwhile, two in 10 market participants operate a generating facility as a separate business, 17.50% are outside the energy industry, and 7.50% are related to distribution utilities.

As of the end of June, there were 2,089 registered contestable customers with contestability certificates. Of these, 70% have entered into retail supply contracts, while the rest are still powered by their respective distribution utilities.

About 1,120 of those with supply contracts from retail electricity suppliers need 1,000 kW or more power.

The ERC, in the second quarter, granted 42 licenses to retail electricity suppliers and authorized 25 suppliers from distribution utilities. Contestable customers can source their power needs from either type of supplier. —  Adam J. Ang

A cure for cross-border COVID pains

COVID-19 is overwhelming world economies with its sickening effect, literally and figuratively. There is yet no known immunity, even for the strong and mighty.

Countries are forced to close their borders to contain transmission and preserve lives. Regrettably, this situation left people stranded in places outside of their residence or place of employment, which raises a number of cross-border tax issues, such as the inadvertent creation of a permanent establishment (“PE”) and which country gets to tax the employment income of the stranded individual.

Recognizing these issues, the Bureau of Internal Revenue (BIR) set its own rules to alleviate the adverse tax consequences involving cross-border scenarios with the issuance of Revenue Memorandum Circular (RMC) No. 83-2020.

INCOME FROM EMPLOYMENT
Generally, a country has the exclusive right to tax the employment income derived by its resident taxpayers except when the employment is exercised in another country, in which case, that other country will also have a right to tax. The RMC reiterates the available tax exemption on such income by residents of states with which the Philippines has tax treaties. The exemption is available upon meeting certain conditions under the applicable treaty.

Conversely, the Philippines will have the taxing right over the employment income of a foreign individual under any of the following cases:

The employee is present for more than 183 days (more than 120 days for residents of Poland; at least 90 days for US residents) in the Philippines; or

The employer is a resident of the Philippines; or

A non-resident employer has a permanent establishment in the Philippines which bears the remuneration.

One particular area of focus here is the first test which highlights the presence in the Philippines of a foreign national employee.  Due to the travel restrictions, a lot of stranded employees have breached the period threshold under the tax treaty.

Fortunately, the BIR will not be strictly applying the treaty provisions. The unintended/stranded days due to COVID-19 travel restrictions will be considered as “force majeure” for purposes of determining the length of stay in the Philippines. Thus, the RMC clarifies that the unintended days that a foreign national spent in the Philippines shall not be counted as “Philippine days,” provided that he or she leaves as soon as the travel restrictions and/or quarantine measures are lifted.

As an illustration, a non-resident alien who was sent by his Singapore employer to work for a Philippine company for 90 days but due to travel restrictions, was stranded in the Philippines for at least 94 more days, will still be eligible for treaty exemption despite accumulating actual Philippine days of more than 183. Given the exceptional nature of his case, the application of the relevant provisions of the Philippines-Singapore Tax Treaty will not be strictly applied, i.e., by disregarding the 94 days of unintended stay. As a result, he will remain a resident of Singapore despite his temporary dislocation.

As a caveat, the RMC states that the Philippines may still tax the employment income if it will appear that he is employed by a domestic company or if his remuneration is borne by a PE of the Singapore employer in the Philippines.

The same is true for a UK resident who went on vacation to the Philippines before COVID and was stranded and forced to work remotely in the country. In this case, the BIR will likewise disregard such period of unintended stay for purposes of counting his Philippine days, provided that he has no other connections to the Philippines and that he should leave the country as soon as circumstances permit.

The RMC provided another illustration where an Indonesian national who is supposed to be assigned to do fieldwork in the Philippines for seven months beginning March 17, 2020, was unable to travel and therefore, remained in Indonesia. Though not working, she received a wage subsidy from her Indonesian employer equivalent to her monthly remuneration. Under the RMC, the employee’s income, including her paid leave, shall be subject to Philippine tax. In this case, the BIR will look at the circumstances that would have occurred had it not been for the travel restriction, i.e., the employee would have already been working in the Philippines.

What is quite odd in this last illustration is that the employee has not even commenced employment yet and the wage subsidy was paid by the Indonesian employer. Shouldn’t the income then be attributed to Indonesia? It appears though that the BIR may have just applied the force majeure principle uniformly regardless of whether the affected travel is inbound or outbound. Perhaps for practicality, this would be the easy, and maybe fair approach. The taxation of the compensation income of the stranded individuals would thus follow what would have been the case had the travel restrictions not been imposed.

While there may be some wisdom to this, I find this quite onerous at this time when everybody is looking for ways to alleviate additional burdens. Perhaps, this wage subsidy (which I assume is part of government stimulus to keep workers on the payroll during the crisis and is not due to the exercise of employment) may be treated differently than compensation income and simply taxed based on residency.

DOCUMENTARY REQUIREMENTS
In order to prove the extended presence in the Philippines because of COVID-related travel restrictions, the following documents are required to be maintained and submitted to the BIR in support of a taxpayer’s application for tax treaty relief:

Authenticated sworn certification stating the relevant facts and circumstances of the bona fide presence of the employee in the Philippines;

Duly executed contract/s (must be consularized or apostillized if executed/signed in a foreign country);

Certified true copies of the confirmed booking or flight itinerary for the original and re-booked flights; travel advisory on the cancellation of flight issued by the airline company; the employee’s passport, including blank pages thereof; and

Other documents that the BIR shall deem necessary depending on the circumstances.

As the RMC only addresses issues insofar as treaty countries are concerned, the BIR should likewise provide similar guidelines on the application of domestic law thresholds to minimize unduly burdensome compliance requirements in the context of the COVID-19 crisis. This would be for affected individuals who are not residents of treaty countries.

Like a vaccine showing promising results in clinical trials, the RMC is a step closer in addressing the ill effects of travel restrictions on cross-border taxation.

The PE implications of the travel restrictions due to the COVID situation will be covered in next week’s column.

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

 

Raymund M. Gutib is a senior manager at the Tax Services Department of Isla Lipana & Co., the Philippine member firm of the PwC network.

+63 (2) 8845-2728

raymund.m.gutib@pwc.com

The Senate report on Trump and Russia is a triumph for truth

By Timothy L. O’Brien

ONE of Trumpism’s enduring scars will be the social fissures it’s widened by waging war on objective reality and public faith in bedrock institutions. It’s also fostered a cult of personality around Donald Trump, allowing him to posture as the final arbiter of truth and guardian of the downtrodden. But division, chaos and disrepair — and the corruption of the American experiment — are the long-term consequences.

So it’s encouraging when a bipartisan group of federal legislators reminds us that facts matter.

A 966-page Senate report (https://www.intelligence.senate.gov/sites/default/files/documents/report_volume5.pdf) published Tuesday leaves no doubt that an extensive network of Russian operatives with intelligence ties worked with Trump’s operatives to torpedo Hillary Clinton’s campaign four years ago. Russian President Vladimir Putin oversaw the effort, including a successful hack of Democratic Party computer systems. Why? To smear Clinton and hobble her administration if she won, and to gain leverage with Trump if he won.

The Republican-led committee that produced the report said that Trump’s former campaign manager, Paul Manafort, was so steeped in the effort with Russia that he posed a “grave counterintelligence threat.” It said that Donald Trump, Jr., the president’s son, participated in a covert effort by the Russian government to help his father in 2016. It said the president himself may have been a possible target of Russian blackmail. It said that Putin was aware that Trump — during his presidential campaign — was secretly pursuing a deal to build a skyscraper in Moscow.

The committee also found that Roger Stone, Trump’s longtime political hatchet man, made elaborate efforts to learn about Russian leaks of confidential Democratic e-mails through Julian Assange’s hacking collective, Wikileaks. And in the course of that discovery, the committee learned that Trump “did, in fact, speak with Stone about Wikileaks and with members of his campaign about Stone’s access to Wikileaks on multiple occasions.” That’s interesting, because the president himself, in written testimony to former Special Counsel Robert Mueller, said he couldn’t recall those conversations.

Mueller concluded his work last year by saying he hadn’t found enough evidence to charge Team Trump with a criminal conspiracy. He clearly found evidence that the Trump camp tried to obstruct justice, however, and he left it to Congress to hash out the matter. For its part, the Senate report said that the Trump campaign’s intersection with Putin’s underlings didn’t amount to a coordinated conspiracy — and that in some cases the sheer dimwittedness of the people working for Trump exposed them to manipulation.

You may remember that Trump and his GOP backers tried to spin Mueller’s findings by saying that “no collusion” meant that Trump and those around him did nothing wrong. Republicans on Tuesday resurrected the “no collusion” mantra, working hard to convey the idea that the Senate report somehow meant that everything’s all right, everything’s fine, and we want you to sleep well tonight.

But, of course, everything isn’t alright. The Russia scandal wasn’t a hoax. It was reality.

Even if the skullduggery the Senate documented didn’t amount to a formal conspiracy, sabotage and malfeasance took place. Russia got its hooks into a presidential election, Trump used his campaign to try to make business deals in Moscow, the people around Trump invited foreign influence into an election, and the president apparently lied to Mueller. It’s not a mystery why Trump has cultivated and coddled Putin throughout his presidency, even if the Senate didn’t chart the money trail all the way to Russia. The president, who spent his business career consorting with mobsters, has always had an affinity with grifters and those, like Putin, who he thinks might help him grift.

Trump’s supporters have worked overtime focusing on tangential aspects of the Russia scandal to keep Trump’s presidency in play, confirm their own biases or soften any guilt they might feel for looking the other way in the face of overt corruption. Right-wing media and Republican apologists have argued that a minor piece of evidence used by federal investigators — an unreliable dossier about Trump’s Russia ties prepared by a former British intelligence agent, Christopher Steele — meant that the entire Russian probe was improper.

As I noted at greater length last year, the Steele dossier wasn’t the reason the Russia probe began, and its shortcomings simply weren’t pivotal enough to demonstrate that the probe was ill-considered. The Senate report points out that the Federal Bureau of Investigation mishandled the Steele dossier and gave it too much credence. More important, however, the report doesn’t dismiss the far greater weight of all the other evidence of Trump’s corrosive and dangerous game of patty-cake with Russia.

Russia’s threats to American elections and national security are ongoing, and that’s another reason the Senate report is valuable. Because facts are fundamental, and it’s impossible to make good decisions without them. Mother Nature has reminded us of this truth with the coronavirus pandemic. The Senate’s report teaches the same lesson in its assessment of Russia, the Trump administration and White House propaganda.

BLOOMBERG OPINION

Calibrated response

To calibrate means to adjust, or to take into account all factors and to compare all available results data. At this point in our fight against COVID-19, it is not too late for our leaders to reassess our situation and to fine-tune the medical interventions deemed necessary. But this also means listening to all resource people and accepting assistance from all willing to help.

Policy makers should consider the findings of the staff of UP-Philippine General Hospital, which have been reported on in recent days. Please allow me to devote more space for the conclusions of the Aug. 10 paper authored by doctors Regina Berba, Eric Berberabe, Bill Veloso, Rodney Dofitas, Lilibeth Genuino, and Gap Legaspi on behalf of the PGH COVID Crisis Team.

The big challenge now, as we “reopen” the economy, is how hospitals and workplaces can be made safer from COVID-19. This is also to help stop the rising number of COVID cases. I believe this is where the UP-PGH experience thus far can make a difference. Despite having plenty of COVID-19 patients, UP-PGH initially managed to keep itself relatively safe from the virus.

Early on, despite the number of COVID-19 patients they accepted and cared for, only a relatively small number of hospital staff were infected in the course of their work. Of almost 5,000 workers tested in June, only 99 tested positive for COVID, or roughly 2%. Of hospital workers directly dealing or who were in contact with COVID-19 patients, the infection rate was an even lower 1.4%.

How did they do this? They rezoned the entire hospital; installed controlled ventilation systems, air purifying equipment, and UV light and automated hand hygiene dispensers; used Personal Protective Equipment (PPE) even in non-COVID areas; fit-tested N95 and KN95 masks for staff; put up unified donning and doffing areas with safety officers; ran a workplace clinic for staff consultations and testing; released information and educational materials; made housing and transport arrangements for frontliners; and ensured on-site access to RT-PCR testing.

“In PGH, the testing has been markedly simplified so the turnaround time (TAT) of the PCR testing at the PGH Molecular Laboratory has gone down from a previous of five days to 24 hours. There is also a fast lane for emergency cases where the test takes only three hours for the results to be released,” the doctors noted in their Aug. 10 paper.

And this was made possible only because UP-PGH now has additional resources to swab test more patients as well as staff. Private businesses like First Gen of First Philippine Holdings Corp. are supporting it with new RT-PCR testing machines and lab equipment that helped expand the hospital’s testing capacity from 150 to 1,500 tests per shift.

But there was another lesson to be learned as well from its COVID-19 experience, UP-PGH noted, and that was that PCR Tests were only point-in-time tests. “The assurance it provides is brief and lasts only up to the point a person was tested. COVID-19 is so efficiently contagious that the only true guarantee that any institution is safe is when our entire community works together to get infection rates as low as possible.

“As the government started to lift quarantine restrictions, we were not able to control the contribution of human movement anymore. These variables were not part of our initial formula. Weeks into the General Community Quarantine, our COVID rates among the HCWs rapidly rose,” it added. Even those who never went close to the COVID areas were getting infected, it said.

Recognizing that the hospital system was not isolated from the rest of the community, UP-PGH said that “to keep our infection rates down in PGH and in all other health facilities and workplaces, cooperation from all inside and outside PGH is needed. Our efforts need to extend beyond our hospital systems and we must work with the community.”

As for mass testing, UP-PGH also noted that “the economics of COVID testing if done routinely does not support an efficient use of resources.” For one, periodic mass testing in places with many workers can be expensive, and the “massive manpower requirement if done routinely will be taxing to a system with competing needs. Instead these huge resources can be channeled to proven and cost-efficient preventive measures.”

Instead of routine mass testing, as what the government seems to be now pushing at the workplace, UP-PGH is advocating for “targeted testing.” In the case of the hospital, it said, it is opting now to test healthcare works “whenever they need to be tested such as when a staff member has symptoms; been unduly exposed to a COVID patient; been exposed without the benefit of adequate PPEs; and, whenever they feel they need to be tested.”

UP-PGH also points to the need for better contract tracing and the urgency of quarantine and isolation. “To cut the transmission, persons with High Risk Exposure need to be identified, alerted and voluntarily go for strict isolation as soon as [they have] symptoms. COVID patients are most infectious from one day before and up to the first three days of start of symptoms. The only way our numbers will go down is to do immediate quarantine as in as soon as exposed; immediate test, and isolate once with symptoms.”

They added, “All of society must know that when they get High Risk Exposures they need to start quarantine, not next week but right away. For instance, living in the same household of a COVID positive case is a high-risk exposure. All household contacts should go on quarantine starting on the same day the positive result is released.”

The UP-PGH doctors also noted that for COVID-19, “the window of best opportunity to intervene and make a difference is very narrow. The time one is exposed to the time one starts becoming symptomatic occurs mostly from Days 1 to 7, averages 4-6 days in most series, and can extend up to 14 days.”

In releasing their findings, based on their experience since the start of the pandemic, UP-PGH doctors are offering a constructive assessment that could serve as a lesson for others. In my view, these lessons should be considered in strategizing a calibrated response to the needs arising from the COVID fight. The UP-PGH paper also conveyed a message of hope particularly  for those who have gotten weary or live in fear.

They wrote, “The COVID-19 pandemic is here to stay for a few more months. Let us gather our best practices and continue to learn from each other. We are one with the WHO when it states what we need to get through this pandemic are: SCIENCE, SOLUTIONS, and SOLIDARITY. Most of all, if there is one thing we learned from the hard work of the UP-PGH community, from the support of the greater community around us: there is hope. We can do this!”

 

Marvin Tort is a former managing editor of BusinessWorld, and a former chairman of the Philippines Press Council

matort@yahoo.com

Energy reserves and security

During the media briefing by the Independent Electricity Market Operator Philippines (IEMOP) last week, Aug. 11, data on electricity supply, demand, reserves and prices for the Luzon-Visayas grids from March to early August this year were shown, covering the various  COVID-19 lockdown periods (ECQ, MECQ, GCQ).

I compared the year-on-year (yoy) data and the good news is: One, while average demand in April-June declined by -14.7% (which correlates with the -16.5% GDP in the second quarter), the decline in July was only -3.5%. Two, average prices at the Wholesale Electricity Spot Market (WESM) in April-June declined by -70.8% and continued with a July decline of -58%.

The bad news, however, is that electricity demand in July (10,135 MW) was lower than June (10,174 MW), meaning the month-on-month (mom) economic activities are still flat or negative. The -58% decline in the July price was due to increased power supply compared to both July 2019 and June 2020.

And that is why we should have an ever-rising power supply, to stabilize if not reduce electricity prices, and ensure more power stability and predictability. Not restricting or killing some power supply to promote energy cronyism.

I refer to the endless lobbying to promote the intermittent, unstable, unreliable renewables especially wind and solar. The lobbyists promote more use of batteries to solve intermittency problems — fine, but this will lead to higher prices because those huge batteries are not cheap.

A persistent narrative why countries should go for quick energy transition from fossil fuels and nuclear is the fear of “imported fuel supply insecurity” and hence, the need to rely on domestic, indigenous renewables. For the Philippines in particular, the scare mongering centers on “supply insecurity of imported coal” as we have indigenous natural gas (but this will soon be depleted).

Is imported coal supply insecure and dangerous?

If one uses emotion and climate alarmism, the answer is “yes.” But if one uses reason and hard facts, the answer is “no.”

I checked the proven reserves worldwide for coal, gas and oil, and the computed Reserves-to-Production (R/P) ratio. This ratio shows the number of years that those remaining reserves would last if yearly production were to continue flat. The proven reserves of coal is nearly three times the reserves for gas and oil, and two countries with huge coal reserves are not far from the Philippines — Indonesia and Australia (see the table).


Other major producers are: a.) Natural gas: Qatar with 12.4% share, R/P 139 years; and Turkmenistan, 9.8% share, R/P 308 years; b.) Oil: Iraq with 8.4% share, R/P 83 years; Kuwait, 5.9% share, R/P 93 years. Countries in the table with 500+ R/P ratio means they have very small production and consumption relative to their reserves.

The Philippines in 2019 has a total installed power capacity of 25.5 gigawatts (GW), of which 41% comes from coal, 17% is oil-based, 15% hydro, 13.5% natural gas, 7% geothermal, and 7% variable renewable energy (VREs, solar+wind+biomass).

But in actual electricity generation, out of 106.0 terawatt hours (TWH) in 2019, 55% came from coal, 21% from natural gas, 10% geothermal, 11% from hydro and oil-based, and only 3% from VREs (source: DoE Power Statistics 2019).

So while the pro-VREs and anti-coal lobbyists want to kill coal as soon as possible, they enjoy 24/7 electricity mainly from coal power plants because their beloved wind-solar can contribute only about 2% of total power generation.

The VREs lobby also silently promotes natural gas. They are silent about the fact that global gas reserves and security are much lower than coal reserves as shown in the table above. And while they are loud in opposing carbon emission of coal plants, they are silent about methane emission of gas plants. Both CO2 and CH4 (methane) are greenhouse gases (GHGs) but the latter has a bigger, about 28 times, potential as GHG.

California currently has continuing power instability with actual blackouts. It has the US’s biggest concentration of solar-wind farms, which explains why it has the US’ highest incidence of blackouts. In 2008-2017, California had 4,297, Texas 1,603, New York 1,528, Michigan 1,369…

The Philippines should never follow the example of California. The Philippines should have market- and customers-based power generation mix, not environmentalists- and politics-based power development.

 

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

minimalgovernment@gmail.com

Is hitting a punching bag a good exercise?

AS FITNESS EXERCISES go, a punching bag (maybe with the painted face of a hate object) can get you nice and sweaty. The object of the fitness program is to just hit this heavy object, usually swinging from a hook and having the rough dimension of the human torso or a sack of rice, and just dance around it. Loud music helps hype up the adrenaline for the swinging of the fists. It’s a bit more aggressive than yoga.

Maybe you can wear boxing gloves so you don’t hurt your fists as they smash into a heavy swinging object. (Never mind the expression “taking the gloves off” to imply administering a savage attack.) A trainer can assist you and hold the bag still, so you don’t miss it with your swings. He may be absorbing the blows too, but that’s his job. The bag after all is swinging around with each punch, no matter how weak. What if it swings back and seems to fight back. Still, it’s not a real boxing match. Only one side is raining blows. The object just takes them.

This simple fitness regime sheds calories faster than just jumping to conclusions or stretching the truth. It can also describe a leadership style. This is not limited to a particular boxer who had not completely turned in his gloves when he jumped into the political ring. In fact he is still keeping in shape for the next booking. Of course, this pandemic is not helpful in fixing a pairing, or a date.

In managing a crisis, the “punching bag” approach suggests lashing out with a flurry of fists and grunts at a heavy target not expected to retaliate in any way whatsoever. A bag swinging from a hook is expected to just hang in there. It’s the nature of the beast. It’s there to absorb blows.

The war freak or bully can work off his aggression on a punching bag. He doesn’t need to feel guilty that his blows, even if accompanied by invectives and shouts, are doing anybody any harm. Of course neighbors or others socially distanced from him at the gym, when they are allowed to open again, may be put off by the noise. But with the other grunting gym rats working on stationary bikes or lifting weights, who really pays attention to the shouting?

Hitting the bag is not intended to be a spectator sport. Where’s the thrill for the sports fan?  There is no contest between a man throwing punches and a target that does not even duck or wince. It’s too one-sided and predictable. But who can account for tastes? The fitness buff is enjoying himself and maybe his friends like to applaud his effort. And they may even join in with sticks and hammers.

There is no punching-bag lobby group, or even a party list representing inanimate objects of assault. (Well, there’s an idea some family might adopt — punch, punch, punch party list?) So, even advocates against domestic violence will find no torch to carry for a mere bag filled with sand, rags, and grains, sometimes some water too. It is designed to take the blows — bring them on.

As an approach to problem-solving, punching bags shows no effectiveness even in defining a problem, much less in providing a meaningful response to a crisis. Its limited appeal is probably to remove stress and work off unresolved aggressions.

More problematical is when the punching bag does not already hang from a hook and is placed there instead for sport. Even worse if the bag has arms and legs, and breathing heavily. This approach shows some similarity to the scapegoat. In biblical times, this animal is made to bear the blame for all catastrophes and is let loose in the wilderness to be devoured by predators. Or sometimes it is tied to a stake and left there for the same purpose.

The punching bag can be made to take the blows for a crisis, if only as a distraction. The mention of the name of the punching bag is a call for others to join in the attack. And then — there they go. It’s time to hit the sack.

 

Tony Samson is Chairman and CEO, TOUCH xda

ar.samson@yahoo.com

Democrats nominate Joe Biden for president

DEMOCRATS formally nominated Joe Biden for president on Tuesday, vowing his election would repair a pandemic-battered America and put an end to the chaos that has defined Republican President Donald Trump’s administration.

The second night of the party’s four-night national convention, under the theme “Leadership Matters,” featured elder statesmen like former presidents Bill Clinton and Jimmy Carter, rising stars of the Democratic Party as well as prominent Republicans, who made the case that Mr. Biden would return integrity to the White House and normalcy to American lives.

Mr. Biden’s wife, Jill, an educator, delivered the headline speech from a Delaware high school where she once taught, offering a deeply personal account of how their love helped him heal after his first wife and infant daughter were killed in a car accident.

“I never imagined at the age of 26 I would be asking myself, ‘How do you make a broken family whole?’” she said. The answer, she said, is the same for a broken nation: “With love and understanding.”

“If we entrust this nation to Joe, he will do for your family what he did for ours: bring us together and make us whole,” she said.

Throughout the evening, Democratic leaders contrasted Mr. Biden’s long experience with what they described as Mr. Trump’s deadly mishandling of the coronavirus outbreak and his willingness to corrupt democratic institutions.

“At a time like this, the Oval Office should be a command center,” Mr. Clinton said in a pre-recorded video. “Instead, it’s a storm center. There’s only chaos. Just one thing never changes — his determination to deny responsibility and shift the blame.”

With the four-day convention largely virtual due to the coronavirus, delegates from around the country cast votes remotely to confirm Mr. Biden as the nominee in a coast-to-coast roll call that drew instant raves on social media.

In clips that showcased the party’s diversity, Democrats explained why they were supporting Mr. Biden while putting their own state-specific spin on the proceedings, from a calamari appetizer in Rhode Island to a herd of cattle in Montana.

After hearing from his home state of Delaware, which went last in his honor, Mr. Biden appeared live alongside Jill Biden to thank the party for nominating him, more than three decades after his first unsuccessful run for the White House.

“Thank you very, very much from the bottom of my heart,” said Mr. Biden, who will deliver his acceptance speech on Thursday. “It means the world to me and my family.”

The program started by showcasing some of the party’s rising politicians. But rather than a single keynote speech that could be a star-making turn, as it was for then-state Senator Barack Obama in 2004, the convention featured 17 Democrats in a video address, including Stacey Abrams, the one-time Georgia gubernatorial nominee whom Mr. Biden considered for a running mate.

“America faces a triple threat: a public health catastrophe, and economic collapse and a reckoning with racial justice and inequality,” Ms. Abrams said. “So our choice is clear: a steady experienced public servant who can lead us out of this crisis just like he’s done before, or a man who only knows how to deny and distract.”

As they did on Monday’s opening night, Democrats featured a handful of Republicans who have crossed party lines to praise Mr. Biden, 77, over Mr. Trump, 74, ahead of the Nov. 3 election.

Republican former Secretary of State Colin Powell, a retired four-star general who endorsed Mr. Biden in June, was one of several national security officials who spoke on the Democrat’s behalf.

“He will trust our diplomats and our intelligence community, not the flattery of dictators and despots,” Mr. Powell said. “He will make it his job to know when anyone dares to threaten us. He will stand up to our adversaries with strength and experience.”

Democratic former Secretary of State John Kerry attacked a Trump foreign policy he called “incoherent.”

“When this president goes overseas, it isn’t a goodwill mission, it’s a blooper reel…. America deserves a president who is looked up to, not laughed at,” Mr. Kerry said.

Without the cheering crowds at the in-person gathering originally planned for Milwaukee, Wisconsin, TV viewership on Monday was down from 2016. But an additional 10.2 million people watched on digital platforms, the Biden campaign said, for a total audience of nearly 30 million.

Aiming to draw attention away from Mr. Biden, Mr. Trump, trailing in opinion polls, held a campaign rally in Arizona, a hotly contested battleground state that can swing to either party and play a decisive role in the election.

Mr. Trump called Mr. Biden’s immigration plan “radical” and “extreme,” continuing his effort to portray Mr. Biden as a puppet of left-wing agitators. In a statement on Tuesday night, campaign spokesman Tim Murtaugh said Mr. Biden’s nomination means “his supervisors from the radical left are now formally in charge.”

Mr. Biden’s vice-presidential pick, Senator Kamala Harris, will headline Wednesday night’s program along with Mr. Obama.

The Republican National Convention, also largely virtual, takes place next week. Mr. Trump will give his acceptance speech at the White House, despite criticism he is politicizing the presidential residence. — Reuters

Australia touts deal for COVID-19 vaccine as virus flare-up subsides

SYDNEY/MELBOURNE — A fresh outbreak of infections in Australia’s coronavirus hot zone of Victoria eased further on Wednesday, while the country agreed a deal to secure a potential COVID-19 (coronavirus disease 2019) vaccine that it plans to roll out cost-free to citizens.

Australia has signed a deal with British drug maker AstraZeneca to produce and distribute enough doses of a potential coronavirus vaccine for its population of 25 million, Prime Minister Scott Morrison said late on Tuesday.

“Should we be in a position for the trials to be successful, we would hope that this would be made available early next year. If it can be done sooner than that, great,” Mr. Morrison said on Wednesday.

All Australians will be offered doses but a medical panel will determine the priority list of vaccine recipients.

“Naturally you would be focusing on the most vulnerable, the elderly, health workers, people with disabilities in terms of the speed of rollout,” Health Minister Greg Hunt told Sky News.

Health authorities would also have to take into account where the highest risk of transmission is and how the vaccine works in different age groups when deciding who should get it first, Victoria’s chief health officer Brett Sutton said.

“If it does work and it’s 80% to 90% effective, then absolutely it will be a game-changer,” Mr. Sutton said, although he cautioned that broad testing was still at a preliminary stage. “So we shouldn’t hang our hats on a single vaccine.”

AstraZeneca last month said good data was coming in so far on its vaccine for COVID-19, already in large-scale human trials and widely seen as the front-runner in the race for a shot against the novel coronavirus.

The vaccine, called AZD1222, was developed by Britain’s University of Oxford and licensed to AstraZeneca.

Mr. Morrison said Australia was also looking for other vaccine deals, including with the University of Queensland and its partner, Australian firm CSL Ltd.

CSL estimates first doses of the University of Queensland vaccine will be available for emergency use by the middle of 2021, Chief Executive Paul Perrault told reporters on Wednesday.

CSL said its first priority would be manufacturing the UQ vaccine, but it was also in talks to help AstraZeneca manufacture its vaccine.

Mr. Morrison said Australia is also talking to its Pacific neighbors, including Indonesia, Papua New Guinea and Fiji, about supplying vaccine.

A flare-up in infections in Australia’s second most populous state of Victoria forced authorities two weeks ago to impose a nightly curfew and shut large parts of the state’s economy.

The state has seen a slowdown in new cases in recent days, allaying fears of a nationwide second wave. There were 12 deaths and 216 new infections in the past 24 hours, down from daily increases of more than 700 two weeks ago.

Despite the surge in the past month, Australia has avoided the high casualties of other nations with just under 24,000 infections and 450 deaths from the virus. — Reuters

South Korea warns of nationwide coronavirus spread

SEOUL — South Korea reported on Wednesday its highest daily rise in novel coronavirus cases since early March as outbreaks from churches around the capital spread, prompting a warning of a nationwide wave of infections.

The 297 new infections mark the sixth straight day of triple-digit increases in a country that has managed to blunt several previous outbreaks.

The national tally rose to 16,058 infections with 306 deaths, according to data from the Korea Centers for Disease Control and Prevention (KCDC).

Nearly 90% of the new cases appeared in the capital, Seoul, and surrounding areas, raising concern of the rapid spread of the virus in a metropolitan area of more than 25 million people.

“We’re in a desperately dangerous crisis where infections are spreading in the Seoul metropolitan area and threatening to lead to a massive nationwide transmission,” Vice Health Minister Kim Gang-lip told a briefing.

“The government cannot contain the current spread only with tracing and isolation…. Please stay home unless you must go out.”

At least 140 of the new infections are linked to the Sarang Jeil Church, taking the number of cases from it to nearly 600.

Authorities are trying to trace another 600 members of the church’s congregation, who should be in isolation and would like to test all of its 4,000 members, Mr. Kim said.

More than 8,500 police have been mobilized to track down church members, he said.

Authorities have said some members of the church, which is run by a radical conservative preacher, are reluctant to come forward and get tested, or to self-isolate.

Prime Minister Chung Sye-kyun said the government would take legal action against the church for any attempt to disrupt tracing and testing efforts by failing to provide accurate membership lists. — Reuters

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