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Educators in uncharted waters with return to classroom still uncertain

By Gillian M. Cortez, Reporter

THE APPROACH of the new school year while the pandemic remains uncontained is filling many with dread, including the students who may have to spend large parts of it cooped up at home, staring at screens, away from their friends.

Karla Martinez, an incoming university freshman, said the thought of another unusual school experience is “devastating.”

“It’s depressing to think (that) you can’t do anything about it. You have to follow the rules,” she said. COVID-19 has already caused her to miss milestones like her Senior High School graduation. It also denied her the opportunity to experience things will serve her well at the next level of her education, like working with a group to put together a thesis, as well as the pressure cooker of the thesis defense itself.

“We had school requirements we weren’t able to pass. We had to pass our thesis unfinished,” Ms. Martinez said.

When President Rodrigo R. Duterte first ordered the Luzon lockdown in mid-March, Ms. Martinez lost the remainder of her school year, which had a few unexpected consequences — like losing a sense of purpose “because it affected my education.”

The education sector consists of nearly a million teachers and millions more students. The lockdown first announced in Luzon was followed by similar lockdowns in other areas. Where possible, educators and students worked out their lessons remotely. Some schools made the difficult decision to cut the school year short.

The old reliance on traditional classroom learning, and the growing realization that the old ways may no longer be workable, have sent educators scrambling for new ways of doing things — while absorbing the cost and toughing out the transition to the new methods.

The Department of Education (DepEd) and the Commission on Higher Education (CHEd) have said that distance learning requires special preparation and investment. Some private schools have upgraded their systems or launched online portals, which allow students who own computers and devices to keep up.

Graduate student Noah Shen Datinginoo is no stranger to alternative pathways to learning, including online portals and apps. While her remote pursuit of Biology studies is facilitated by computers, her constraint is the reliability of her internet connection. She also notes that non-classroom channels may not work out for everyone.

“We have different styles of learning. Some can keep up via online classes but there are a lot of factors (that can interfere) especially internet quality. It’s difficult. I would say distance learning effectiveness is 50/50. I’m not 100% sold on it,” she said. When her connection failed, Ms. Datinginoo found herself asking her professor to repeat what they just said.

“It’s a good thing they are patient.”

Private-school teacher Rodney De Leon, who handles grade school and high school students, has found the pandemic learning experience manageable, though the biggest downside of the new reality is a diminished ability to monitor what his students are actually absorbing. He regrets his inability to personally judge whether the student has succeeded in taking in the lessons.

“Student supervision is a challenge because in a face-to-face setting you can see who is cheating or who’s doing their work honestly. (Online), you’ll never know if someone is copying the answer from the internet or is asking for help. Some teachers overlook that,” he said.

Classes will resume in August for K-12 schools, while tertiary institutions have the option to open, depending on the delivery systems for teaching. Schools are scrambling to prepare curricula with an eye towards selecting appropriate subject matter and adjusting for the many ways in which pupils learn.

Teachers Dignity Coalition National Chairman Benjo Basas said in the case of K-12 teachers, the sudden shift to learning outside the classroom has raised the issue of inequality in accessing the online classes.

“We do not oppose the opening of classes on Aug. 24. What we are saying is the government should assure the system won’t leave behind any learner or family in this new modality of learning,” Mr. Basas said.

University of the Philippines (UP) College of Education Dean Jerome T. Buenviaje said the Philippines has a relatively young population, with a student population of 32 million, and the outcomes largely depend on two things: the teacher, and the student’s learning environment.

“Which is better, face-to-face or remote learning? I would say it depends. Quality education is not assured if you have face-to-face classes that you get quality education. It depends on the teacher and it depends on the learning environment you provide.”

Both the DepEd and CHEd have been trying to ensure the continuity of learning and the safety of all involved. Both agencies are pushing for blended learning, which combines traditional learning with out-of-classroom alternatives. While online learning is an option, blended learning will also employ printed modules, radio, and television.

As early as February, CHEd released guidelines for higher education institutions (HEIs), discouraging large crowds, prescibing hygiene and health standards, and establishing screening protocols. Some HEIs suspended classes when the first cases of community-transmitted COVID-19 emerged in March while others sought to complete the semester online. Others decided to suspend their school year.

In May, the Inter-Agency Task Force for the Management of Emerging Infectious Diseases (IATF-EID) issued its Omnibus Quarantine Guidelines, which permit HEIs operating under modified general community quarantine (MGCQ) to conduct face-to-face classes when the school year begins, but with capacity restrictions.

HEIs that opt for online classes are permitted to conduct classes any time while those planning to implement flexible learning can open in August. Those opting for face-to-face instruction are not allowed to start before September.

Meanwhile, the DepEd is making its own tweaks to ensure learning is effective.

Undersecretary for Curriculum and Instruction Diosdado M. San Antonio said the game plan is basically to supplement online classes with printed self-learning modules.

“There are materials that are almost ready to be shared with our own field officials for reproduction and contextualization but some have yet to be submitted because they are in the process of quality-assuring the learning resources that have been prepared,” he said.

Mr. San Antonio said modules have been around for some time as a contingency against emergencies and natural disasters. But the scale of the requirements during the pandemic is unprecedented.

“What we are doing now is really scaling up. In the past, we only prepared a few alternative delivery modules.”

The DepEd is also working to train teachers to deal with the sudden shift, and noted that parents can play a part — but not all of them.

Mr. Basas said, “Not all parents are able to help out… Can they teach their kids? Also, after the pandemic and the lockdowns, the main focus of families, especially poor families, is earning a living. Maybe parents won’t be able to juggle this.”

Mr. San Antonio acknowledged that not all parents will be there to supervise their children’s lessons, and to fill the gap, the department will enlist volunteer tutors among college graduates, teacher applicants, or displaced workers who can be trained. DepEd said such volunteers could help parents unable to home-school, especially if the children are in the lower grades.

Mr. Basas said the shift to online learning will stress the internet infrastructure and may leave students in far-flung areas behind.

The Department of Information and Communications Technology (DICT) is currently in talks with both the DepEd and CHEd to provide free wi-fi in schools.

Mr. San Antonio said students in areas with weak connectivity will not be left behind if they are provided modules. He added, “traditional printed learning modules have also been found to be effective.”

For the long haul, everything is up in the air until the availability of a vaccine — the one prerequisite President Rodrigo R. Duterte has cited before ordering students back to school.

Ms. Datinginoo, the biology graduate student, said hands-on laboratory experiments and fieldwork might be where online learning hits a wall. She has had to defer these aspects of her eductaion.

Ms. Martinez, the incoming college freshman, said the new environment will require a major adjustment as she has known only classroom teaching.

Mr. De Leon said his default preference is also the classroom.

“There are pros and cons but I will always prefer the traditional classroom setting because as a teacher, it’s not just lecturing. That’s part of it, but I can also get to relate to my students personally and… can adjust my lessons because I can see how they work, how they react, how they perform,” he said.

Mr. Basas said that while the new environment will require learners to adapt to other modalities, it should not go on indefinitely. “It is not normal, and what is not normal will never be sustainable especially if you’re talking about the long term, and you’re talking about education.”

Nevertheless, Mr. Basas said delaying education may do more harm than good, as many students were falling behind even before the COVID-19 crisis.

“We have to be prepared given the limited time and resources. We have to make the most out of it,” Mr. Basas said. He added the government and private schools should also ensure the security of teachers, since blended learning will require them to leave their homes and increase their exposure.

Mr. Buenviaje said remote learning should only be resorted to in order to mitigate the risk of COVID-19 and “should be all temporary in nature.”

He added that the suspension of face-to-face classes could offer opportunities to innovate. “It is also a chance for us to fight for the right of the Filipino children now in this time of emergency and that is non-negotiable.”

Mr. San Antonio added the key is to keep students motivated, adding that DepEd is ready to adapt and adjust to any problems.

“I think if we do it well the first time, we should not be worried about how it’s going to be done in the future. We assure everybody that even if we are doing new things on a massive scale, we are ready to reconfigure the strategy if needed,” Mr. San Antonio said.

Indonesia’s V-shaped recovery looks elusive as cases spike

INDONESIA is struggling to contain a surge in coronavirus cases in the world’s fourth-most populous nation, casting doubts on the likelihood of a V-shaped recovery for the economy.

For more than a month, hundreds of thousands soldiers and police have been busy enforcing social distancing rules to contain the outbreak in Indonesia. But new cases have continued to spike, more than doubling to over 55,000 since then. Evidence is also fast emerging of the wide spread of the virus outside the main Java island, the nation’s epicenter of commerce and industrial activities.

The spike in infections may prompt businesses to delay reopening and weigh even more on consumer sentiment, deepening a slump in Southeast Asia’s biggest economy and forcing the cash-strapped government to add to its stimulus measures.

Nomura Holdings, Inc. is forecasting a 3.2% contraction in the economy, with the fiscal deficit ballooning to 7.5% of gross domestic product this year. That’s far worse than the government’s projection of growth in a range of -0.4% to 1% and a budget gap of 6.34%.

“The daily cases have worryingly continued to accelerate in recent days, suggesting the reopening may have increased the risk of transmission,” Euben Paracuelles and Rangga Cipta, economists at Nomura, wrote in a report last week. “We believe the increase in COVIDd-19 cases could hamper the recovery, as demand remains weak and consumer confidence is low.”

Indonesia didn’t impose a nationwide lockdown like many of its neighbors, and has already begun easing some of the restrictions put in place to contain the pandemic. Shopping malls, places of worship and restaurants were allowed to reopen from early June in the capital Jakarta and some other cities.

RHB Investment Bank, which forecasts a 1% contraction in GDP this year, says rising COVID-19 cases could force the government to maintain some form of restriction on movement, further suppressing growth. It could also prompt Bank Indonesia to continue its easing cycle by cutting interest rates by 25 to 50 basis points, depending on the severity of the crisis, economist Ahmad Nazmi Idrus said.

Indonesia’s virus strategy is muddled by a lack of uniform policy response across its disjointed islands and may warrant a long period to contain the pandemic, according to Panji Fortuna Hadisoemarto, an epidemiologist at Padjadjaran University in Bandung. More than two-thirds of the country had loose social distancing rules such as mandatory use of masks in public and working from home, and they haven’t been very effective, he said.

“We can no longer estimate the peak of the pandemic nationally because policies are different for each region,” Hadisoemarto said. “If we continue with this strategy, then we have to wait a very long time to get through this. It can be years.”

On a visit last week to Surabaya, the country’s second-largest city, President Joko Widodo set a two-week deadline to control the outbreak there. The region has become a hotspot, recording the highest fatalities among 34 provinces. Having earlier this month ended a partial lockdown in the city, Widodo reminded officials of the need to balance the health of the population with pressures to reopen the economy.

The president also ordered officials to accelerate spending on healthcare and social safety nets to put more cash in the hands of beneficiaries. The government has announced almost $50 billion in fiscal stimulus measures to shore up the economy.

Finance Minister Sri Mulyani Indrawati expects the economy to recover in the third quarter after an estimated 3.8% contraction in the current one. Coordinating Minister for Economic Affairs Airlangga Hartarto has said the country is poised for a V-shaped rebound given its less punishing virus containment strategies.

The spike in new cases in recent weeks in East Java, South Sulawesi, South Kalimantan and Jakarta has prompted authorities to abandon forecasts of a June peak and rather focus on measures to stem its spread. Indonesia’s test ratio of 2,750 for every 1 million of the population is below that of Bangladesh and Sri Lanka.

With that kind of backdrop, the outlook for the economy is darkening.

“Given the uncertainties about the health situation in Indonesia, our baseline forecast assumes a more U-shaped profile for the economy’s recovery as opposed to a V-shape,” Sung Eun Jung, an economist at Oxford Economics Ltd. in Singapore, wrote in a report. “Even if consumers and businesses are allowed to move around and operate, they’ll be hesitant to do so if their health concerns persist.” — Bloomberg

LGUs rise above the chaos — and strained relationship with gov’t

By Maya M. Padillo, Correspondent
and Marifi S. Jara, Mindanao Bureau Chief

When the state of emergency was declared on March 8, the President’s proclamation cited the need for a “whole-of-government” response to the pandemic — a term first used in the Duterte administration’s strategy to end the communist armed movement, which had local governments as the lead envoys.

But coronavirus disease 2019 (COVID-19) was a different kind of adversary.

It is an “invisible enemy,” said Mayor Michelle N. Rabat of Mati City, the capital of Davao Oriental which has been recognized as a model province for its reintegration program for former rebels.

“We were fighting blind. And with a weak health system, we had to find ways and be innovative in our approach,” Ms. Rabat said.

One of the innovations launched by the city was a heatmap, a mobile phone application for keeping track of all persons confirmed with COVID-19 as well as those categorized as suspected and under monitoring.

Ms. Rabat said the app was prompted by public clamor for the local government to disclose information on its three confirmed cases, which violates privacy laws.

“So we were in a dilemma as to how to deal with it. Thus, we came up with the heatmap. That way, the public could visualize (where the confirmed and potential patients are)… They would now have the choice which areas to avoid,” she said.

Until May 28, with the province in a more relaxed form of quarantine for almost two weeks, the confirmed cases stayed at three, all of whom recovered.

On May 29, a dozen new cases were recorded. Eight were returning overseas workers and four were residents who were locked out of the province when airports and borders closed.

The 12, all asymptomatic, went straight to isolation facilities across the province, which were set up during the almost three-month lockdown.

“By containing (the returnees), we decrease the chance of local transmission… We did not take chances,” said Reden V. Bersaldo, head of the Davao Oriental Provincial Hospital and lead action officer of the province’s COVID-19 task force.

Local governments around the country have generally taken similar ultra-cautious approaches, driven in part by the knowledge that healthcare facilities will be hard-pressed to handle a surge in cases.

Governors and mayors were often a step ahead of, stricter than, and sometimes in conflict with, the National Government.

They were able to do so as the national health emergency declaration authorized them to issue executive orders, which do not require approval from their councils.

President Rodrigo R. Duterte, in his March 16 speech expanding the Metro Manila lockdown to Luzon, did not spell out what the rest of the country was supposed to do, but granted pretty much blanket authority to local governments.

“Just go ahead and the mayor will do it for us… one line lang ngayon, mayor lang muna (it’s one line for now, just the mayor). And he can come up with any measure to protect public health, public interest, public order, public safety and whatever is needed to make life more livable in your place,” the President said.

The Philippines has 1,634 mayors, leading 146 cities and 1,488 towns.

Of the cities, 38 are highly urbanized or independent while 108 are governed by provinces. All towns are under provincial jurisdiction.

Mayor Oscar S. Moreno of Cagayan de Oro, an independent city, said making the initial decisions and taking the first steps were not easy.

Mr. Moreno noted that it was particularly challenging in his case as he had to take into consideration that the city serves as a regional center and is home to the best-equipped public hospital in Northern Mindanao.

“As the pandemic started, we were totally in the dark… Being in the dark, I decided back on March 13 that we will have our daily briefings… the reason is to inform the people on matters that we feel we need them to know,” he said during a May 15 webinar on Vulnerabilities, Preparedness and Resilience organized by the Ateneo de Manila University’s Institute of Philippine Culture.

The briefings, both internal and open to the public through live streaming on social media, were attended by regional and city health authorities, officials of the Northern Mindanao Medical Center, and the police.

The mayor said this constant communication was important because “public health is very elusive, it is like catching mudfish.”

Mr. Moreno said the city also launched an “intensified surveillance program” with teams deployed on a house-to-house mission to collect data, especially for potential COVID-19 patients among those who recently returned to the city.

The data collected will be used in an app being developed by Xavier University for contact tracing and other emergency situations.

As of June 11, the city managed to keep its COVID-19 cases at 15, with six recoveries and six deaths.

“I think the common factor in cases of success at the local level is decisive action from the local chief executive that is principally driven by a real desire to meet the identified needs of the community,” Michael Henry Ll. Yusingco, senior research fellow at the Ateneo Policy Center, said.

“In fact, I think the chaos at the national level has been a hindrance in some way for some local governments to mobilize efforts to serve their respective constituencies,” he added.

‘NOT AN ENEMY’
One widely reported injured party of the chaotic state of affairs was Marikina City and its initiative early in the outbreak to set up its own testing facility — just as global health experts were starting to stress the value of “test, test, test” to immediately identify and isolate virus carriers.

Marikina’s plan was held hostage by the Department of Health’s inability to expedite the accreditation of facilities in the face of the emergency.

Another instance was when Pasig Mayor Victor N. Sotto wanted to keep tricycles operating in the city to serve frontline workers and those needing medical care, despite the ban on all public transportation. He ended up being threatened by national officials with administrative and criminal charges.

At the same time, a food supply crisis was brewing as local government executives started to impose stringent rules at their borders in an attempt to keep the virus out.

By March 19, Mr. Duterte, who was mayor of Davao City for almost two decades before becoming president, backtracked on his pronouncement three days earlier with a message addressed specifically to local government units (LGUs).

“I know you have the mandate to deal with emergencies affecting your localities. I was a mayor myself, in case you have forgotten. But this is an emergency of national proportions, and therefore it is the National Government that should call the shots,” he said.

“Let us work together to implement this quarantine, and it should all begin with the LGUs making sure that your actions are consistent with the national directives. To do otherwise would sow confusion.”

Things cooled off over the succeeding weeks as LGUs and local health authorities busied themselves attending to the relatively minimal number of COVID-19 cases, contact tracing, preparing isolation facilities and strengthening existing healthcare institutions, ensuring the implementation of quarantine protocols, and distributing aid.

But in the last week of May, tensions between national agencies and local governments again erupted as some 24,000 overseas Filipino workers — who were displaced by the pandemic, with most returning via Manila where they were quarantined for 14 days and then became “locally-stranded individuals” (LSIs) — were suddenly being loaded on to planes and buses bound for the provinces without sufficient notice to local authorities.

The rush was prompted by a directive from Mr. Duterte to various departments to sort out the situation within a week.

“Surprise flights from the National Government” that did not always arrive on schedule was how the South Cotabato provincial government described the repatriation, with teams suddenly needed to be deployed in the wee hours to process and provide further transport to the returnees.

Mayor Richard I. Gomez of Ormoc, an independent city that managed to stay COVID-free prior to the reopening of its borders, unwittingly became the poster boy of the LGUs’ frustration.

Mr. Gomez, a former actor and national athlete, stood up to the President’s chief legal counsel and interior secretary when they accused him of having gone into panic mode by blocking returnees.

“The point being, we are honest enough to disclose kung ilan lang ’yung (what is our) capacity… and we will not pretend to be heroes by accommodating more than that at any given time. Because the system cannot collapse. It will be disastrous,” he said.

The mayor said local governments are ready to follow the President’s orders “because we are the soldiers on the ground,” but the implementation has to be coordinated and organized.

“Hindi po kami kalaban (We are not the enemy),” he said.

Cebu Governor Gwendolyn F. Garcia, who locked horns with national officials over such issues as the airport’s closure and the ban on motorcycle back-riding, said in a June 9 briefing, “Sometimes, it is so difficult if there is a national policy that does not seem to consider the realities on the ground and what the people need.”

Mr. Yusingco said while “obviously, the central government must play a robust role in a national emergency,” a more “cooperative and collaborative approach would be a welcome change.”

RECOVERY
Such collaboration will be even more crucial as the country navigates the road to economic recovery with COVID-19 remaining a serious threat.

One National Government initiative — the Balik Probinsya, Bagong Pag-asa Program — could put pressure on areas outside the capital as urban migrants take up the offer to start again in their home provinces with promises of decent housing and livelihood prospects.

The government is expecting at least a million people to sign up, according to National Housing Authority General Manager Marcelino P. Escalada, Jr.

These Balik Probinsya beneficiaries will be joining displaced overseas workers who have come home as well as local residents who lost their jobs or closed their businesses.

The program intends to achieve countryside development by supporting micro, small and medium enterprises and rationalizing fiscal incentives to “encourage the transfer of medium and large businesses to provincial economic hubs.”

Economist Cielito F. Habito, a former socioeconomic planning secretary, said attracting investors to trigger job creation in rural areas would require not just the usual tax breaks and other financial stimulus but infrastructure.

Mr. Habito noted that the current lineup of the administration’s “Build, Build, Build” (BBB) program is still dominated by “mega projects” in Metro Manila and Luzon.

“So are we really putting our money where our mouth is in terms of Balik Probinsya and dispersing economic activity when our BBB program is still inordinately focused on Metro Manila and Luzon,” he said during a May 29 webinar on the Mindanao economy organized by the European Chamber of Commerce and Industry and the Davao City Chamber of Commerce and Industry.

In the 10 years to 2018, Luzon accounted for an average of 73% of the country’s economic output as measured by gross domestic product (GDP).

Of this, 63% was generated by the National Capital Region and the surrounding regions — Calabarzon (Cavite-Laguna-Batangas-Rizal-Quezon provinces) and Central Luzon.

The central islands comprising the Visayas account for 12.5% of GDP while Mindanao generates 14.5%.

Mr. Habito noted that infrastructure development does not just involve roads, bridges and transportation, but online connectivity — an asset that has become even more valuable in the COVID era.

“These are the important magnets for investment and unless we put these in place, it will not be easy attracting investors,” he said.

Philippine Chamber of Commerce and Industry Vice-President for Mindanao Ma. Teresa R. Alegrio, in the same webinar, said apart from infrastructure, local governments should be ready to market their areas with “hard facts.”

“We should be able to give hard facts like the availability of land or special economic zones, and apart from the incentives that they will get is the cost and ease of doing business itself,” Ms. Alegrio said.

She added that the private sector must also strengthen collaboration with LGUs and provide inputs to create a fertile business environment.

“The private sector must have a very active role in ensuring that it gives the right perspective and context as to how we can do business in a better, organized and systematic way.”

The Mindanao Development Authority (MinDA), designated the coordinating body for the Balik Probinsya implementation in the south, has come up with a formula.

A MinDA team led by its chairman, Secretary Emmanuel F. Piñol, has been going around the Mindanao mainland to connect directly with local officials, and he has received commitments from at least three for the establishment of pilot sites.

In the discussions, they identified land for resettlement areas and agricultural ventures, including a complete value chain that will also involve residents outside the returnees’ new village.

“With the needed funding and support in place… the first resettlement area will be ready by September this year,” Mr. Piñol said in May.

As of June 11, clearing was ongoing at a 6.3-hectare site in Kauswagan, Lanao del Norte where an initial 200 returnees from Manila will resettle and produce organic broiler chickens and vegetables.

Mr. Piñol said the land was donated by GNPower Kauswagan Ltd. Co., a subsidiary of the Ayala Group’s AC Energy.

A project management office is also being organized, with Kauswagan Mayor Rommel C. Arnado in the lead and representatives from MinDA and national agencies involved in the program.

“MinDA, under my leadership, will see to it that it (Balik Probinsya program) will succeed in Mindanao and we hope that by doing this, we will be able to provide a template for Balik Probinsya communities in other parts of the country,” Mr. Piñol said.

The COVID-19 economic recovery plan and its immediate implementation are in the hands of current leaders as local and national elections won’t be happening until May 2022.

What they do in the next 24 months will determine how fast the country emerges from the crisis, and whether the recovery heads in the direction of a more equitable development nationwide.

“It is very difficult to identify particular strengths and weaknesses exhibited by local executives in this crisis. Some have risen to the occasion for sure. And I’m sure there are a lot more local officials who are performing well but are not getting media coverage. But I think it is pretty clear that the success or failure of a local government unit depends highly on who is the local executive,” said Mr. Yusingco, “Pretty much the same way the country’s success or failure depends on the person holding the office of President.”

Bangsamoro project confronts threats, old and new, during the pandemic

JUDGING by the numbers, the Bangsamoro Autonomous Region in Muslim Mindanao (BARMM) has done well in responding to the coronavirus public health crisis.

As of June 12, the region had 54 confirmed cases of coronavirus disease 2019 (COVID-19), one of the lowest among the 17 regions in the country. And of the total, 80% were returning residents or overseas workers who were immediately placed in prepared isolation facilities as they started to arrive in late May.

From the initial 11 cases, a potential surge in local transmission did not happen and the four deaths recorded were mainly from among the first patients who contracted the virus.

Another threat in March that was contained involved some 200 Islamic preachers from various parts of the country, but with a majority from BARMM, who attended a gathering at the Jamek Sri Petaling Mosque in Kuala Lumpur, a meeting to which many of Malaysia’s COVID-19 cases were linked.

BARMM Health Minister Saffrullah M. Dipatuan said at the time that the region’s inter-agency task force immediately organized a contact-tracing effort with local governments, the National Commission for Muslim Filipinos, other national agencies, and the Malaysian government.

“The Bangsamoro Government has been doing great with minimum tallied cases… Even if BARMM has been operating for merely almost a year, the response has been commendable,” Secretary Carlito G. Galvez, Jr., chief implementer of the national COVID-19 task force, said during a visit to the region in early June.

Having a government in transition means challenges in governance, manpower recruitment, and budget access and coordination with the National Government, among other areas.

On top of this, BARMM is also contending with the region’s longstanding problems: poverty, with 54% of households having insufficient income to buy minimum basic needs, violent extremism, clan disputes, and the physical — and corresponding psychosocial — rehabilitation of Marawi City.

BARMM Cabinet Secretary Mohd Asnin Pendatun, designated spokesperson of the regional inter-agency task force (IATF), said the effective response may be attributed to the regional government serving as “consolidator” for the health emergency measures.

He noted that BARMM used existing disaster management structures such as the Incident Command System and its management teams down to the provincial level.

“Our role really was to be the regional consolidator… to synchronize our approach and responses to COVID-19,” he said in a May 20 webinar organized by the Institute for Autonomy and Governance.

AUTONOMY
On the other hand, Francisco Lara, Jr., senior peace and conflict adviser for Asia of the independent organization International Alert, flagged how the regional government and the Bangsamoro Transition Authority (BTA) allowed the National Government to take back “most of its devolved and autonomous powers and authority” in response to the crisis.

Mr. Pendatun said local government units (LGUs) were initially “given much power… room to implement community quarantine rules in their localities,” but this was withdrawn in what the national IATF called a “streamlining” of the response structure.

“So beginning May 16, no LGU, be it province, city, or municipality, can implement its own version or add or subtract to the guidelines without approval from the national IATF and endorsement from the regional IATF,” he said.

The cabinet secretary also noted the difficulty of distributing cash aid from the National Government.

Mr. Lara cautioned that, “If unchecked, the public health crisis may undermine the agenda of devolution, decentralization, and autonomy embedded in the Bangsamoro project.”

Finance Secretary Carlos G. Dominguez III, who co-chairs the Inter-Governmental Relations Body with BARMM Education Minister Mohagher Iqbal, is aware of such concerns and has given reassurance that the national government is committed to achieving a genuinely autonomous Bangamoro.

One of the key issues is the Bangsamoro government’s push to be lead implementer of nationally funded programs in the region.

“I assure you that the agencies of the National Government serving as counter-parties in these coordination mechanisms are as fully committed to move forward with this bold initiative in autonomy,” Mr. Dominguez was quoted as saying during a May 29 online meeting with BARMM officials.

Asserting BARMM’s wider autonomy is important as it pursues recovery, said International Alert Country Manager Nikki Philline C. de la Rosa, because it is in the best position to build on the gains of the peace process and deliver sustainable economic and social reforms — especially in the face of the continuing COVID-19 crisis and reemerging threats.

“The inability of state actors to respond in a timely and effective manner to reduce people’s vulnerabilities in the face of a pandemic has caused new tensions, pressures, and horizontal conflicts. Criminal groups, violent extremists, and warring clans are showing renewed activity as security forces remain focused on the implementation of the enhanced community quarantine. The pandemic has caused further delays in the Marawi rehabilitation process, and this also contributed to the mounting social unrest,” Ms. Dela Rosa said.

Moving forward, Michael Henry Ll. Yusingco, senior research fellow at the Ateneo Policy Center, said the Bangsamoro transition administration, which will be in place until 2022, “should build on the dynamics of cooperation and coordination amongst the different LGUs and national government agencies within the BARMM fostered during this national health emergency.”

Ms. Dela Rosa also said the region should tap “evidence-based and data-driven tools” to ensure that “plans and responses are sensitive to the new context and conflict dynamics.”

She said, “Utilizing local capacities in monitoring tensions and conflict and coordinating appropriate response before they erupt into violence would make economic recovery easier.”

Mr. Pendatun acknowledged that the coronavirus is undeniably “an added burden” to what the region needs to accomplish for the transition phase by 2022, but he said “the Bangsamoro government will be up to the challenge.”— Marifi S. Jara

Hazmat suits for air travel are here

AFTER THE Centers for Disease Control and Prevention officially recommended widespread use of face masks to help slow the spread of the COVID-19 (coronavirus disease 2019), the minimalist medical mask quickly got reimagined as a fashion accessory. Then model Naomi Campbell — a famous germaphobe — and musician Erykah Badu stepped it up a notch, sporting custom hazmat suits for stylish social distancing. Now, with the novel coronavirus pandemic showing no sign of slowing, travelers are taking note.

Yezin Al-Qaysi says haute hazmats are just the thing to make flying feel safe again. In mid-April the co-founder of VYZR Technologies, a Toronto-based company specializing in personal protective gear, launched a new product called the BioVYZR via crowdfunding site Indiegogo. The $250, futuristic-looking outer layer resembles the top half of an astronaut’s uniform, with anti-fogging “windows” and a built-in hospital-grade air-purifying device. Paranoid flyers were quick to scoop it up, pre-ordering about 50,000 suits and raising $400,000 for the nascent company. The first batch is set to be delivered by the end of July.

Nobody, not even Al-Qaysi, knows how TSA officials or airline staff will react to the suit, but that hasn’t dissuaded such early adopters as Ginny Maxwell, a talent manager based in Nashville. The mother of two children aged 10 and four had been on the fence about returning this fall to her childhood home of St. Thomas in the US Virgin Islands to see her parents. “I was especially concerned about our four-year-old not being able to keep a mask on for a flight,” she says.

After learning about BioVYZR through an e-mail from Indiegogo, she and her husband decided that being laughed at for looking like Teletubbies would be worth a degree of safety; $1,000 later, the family of four feels better prepared to travel.

“They give us a lot of peace of mind,” says Maxwell. “And the kids are excited to wear their ‘space helmets.’ If nothing else, they will be a strange souvenir of this crazy time.”

THE BACKSTORY
Al-Qaysi says the suit is an adaptation of his company’s first invention, a solar visor meant to provide hands-free shade in desert environments.

“When the [COVID-19] outbreak happened, we realized that in a perfect world, everyone would have access to a Powered Air Purifying Respirator,” he says, referring to a respirator device that provides clean, filtered air from a lithium battery-operated blower. PAPRs provide more protection than a face mask but aren’t as extreme as a full hazmat suit, ordinarily taking the form of a loose-fitting hood or helmet. They’re commonly used by firefighters, medical workers, and people in pharmaceutical and chemical labs.

“We’ve taken a product usually limited to healthcare and industrial settings that’s typically priced around $1,800 and adapted it to be accessible to the public,” says Al-Qaysi.

He declined to give the name or affiliation of the infectious-disease doctor who consulted on the design, raising questions as to how legitimately the product has been tested.

THE SPECS
Constructed from silicone, neoprene, and vinyl, the BioVYZR weighs less than three pounds and is easy to disinfect and pack away between uses. A chest harness, currently available only in a general adult size and a general child size, sits on the shoulders; two adjustable side straps with buckles can be cinched around the waist, similar to those of a life jacket.

An upgrade from the standard face shield, the suit’s tightly sealed, anti-fogging helmet has two peripheral windows for optimal visibility. While the suit looks as if it could stifle the wearer, Al-Qaysi says it is only 1 degree to 2 degrees F warmer than without the suit. Less comfortable, perhaps, is the fact that it adds four to five inches of height, which would make tall travelers fit even more awkwardly into the cramped quarters of an airline coach seat.

The BioVYZR fits snugly below the shoulders, so it shouldn’t interfere with your neighbor’s space aloft. It will, however, cripple any attempt at making small talk with you. In addition to blocking airborne contaminants, the BioVYZR dampens outside sound; a seat mate or flight attendant can hear a user clearly but cannot be heard.

The helmet’s lithium-ion batteries last up to 12 hours on a single charge, keeping them within approved TSA guidelines. (While lithium-ion batteries are not allowed in checked luggage, they’re generally allowed in carry-ons.)

WHO’S BUYING — AND WHO’S NOT
So far, customers have included doctors, dentists, hairstylists, and long-haul travelers, though Al-Qaysi has seen a recent surge in interest from teachers and school administrators looking for a way to keep staff safe as schools look to reopen.

The design isn’t perfect. Based on feedback and insights from the crowdfunding community, VYZR Technologies has already made tweaks that will appear in its already sold-out second batch of shipments. These include a rear pocket for a hydration pack, a slit for a stethoscope, an additional fan for added circulation, and a replaceable power bank. The company also plans to launch new color patterns and additional sizes.

Brooke Berlin, founder of Karoo Consulting, which focuses on business development for African travel companies, spends a lot of time in the air but isn’t sold on the BioVYZR. “I’ve been 1K with United for the past five years,” she says. “I will always wear a mask in public, but I have no interest in spending money — which could otherwise be used to support conservation and community efforts — on a protective suit, or playing into the fear of being around people or traveling by wearing something so extreme.”

Hillary France, founder of Brand Assembly, a business platform built to accelerate fashion and lifestyle brands, believes the fancy hazmat suit will have a moment and then fade quickly. “I don’t think this will replace the face mask as the garment we will put into the COVID-19 time capsule, but it is nice to be able to see someone’s smile,” she says.

The celebrity buy-in of stylish protective suits has others thinking that this hazmat suit is more than a fashion fad. Meredith Del Bello Zec, a mother of two young children who works as a New York-based buyer for Erica Wilson, a fashion boutique in Nantucket, Mass., says she’d invest in a BioVYZR.

“We’re in a moment where supermodels are traveling in full hazmat suits, so function and safety are, thankfully, the focus over all else — aesthetics included,” she explains. “That said, fashion will embrace this as it did with masks, and we will likely start to see versions of this type of gear evolve from designers at every level. I personally would look forward to a version that would be easy to wear when wrangling children on airplanes and through airports.” — Bloomberg

PSE screens brokers for first REIT trade

By Denise A. Valdez, Reporter

THE Philippine Stock Exchange, Inc. (PSE) has started accepting applications for eligible brokers to trade real estate investment trust (REIT) securities ahead of Ayala Land, Inc.’s (ALI) REIT offering.

In a July 15 memorandum on its website, the PSE said it would accept applications for eligible brokers at least one day before the price setting of a REIT initial public offering (IPO).

ALI’s approved REIT offering has its price setting scheduled on July 22, based on the PSE’s disclosure at the PSE EDGE website on Friday. The offer period will begin on July 27 and end on Aug. 3, and the listing date is tentatively set on Aug. 13.

Interested participants in the offering must tap eligible brokers approved by the PSE. Like in trading dollar-denominated securities, trading REITs may only be done through eligible brokers.

Eligible brokers are trading participants that have attended a PSE-organized REIT seminar and have a sworn certification of operational readiness.

To qualify for the 20% broker allocation, a trading participant must submit its application to the PSE at least one day before the price setting of a REIT IPO.

To participate in the 10% allocation for local small investors via the PSE EASy website, a trading participant must submit its application at least one day before the end of the offer period of a REIT IPO.

But the PSE said it “highly recommends that (trading participants) submit their applications as early as possible to be able to participate in a REIT IPO.”

The PSE will upload a list of all confirmed REIT eligible brokers as reference for the investing public. All related REIT information may be found on https://pse.com.ph/REITS/REITS.htm.

ALI’s REIT is set to be the Philippines’ first REIT offering in history, to be done through AREIT, Inc. The company will be offering 456.88 million shares with an overallotment option of 45.69 million shares.

The offer’s indicative price is up to P30.05 per share, which would generate about P15.1 billion in proceeds for the company.

In a statement over the weekend, PSE President and CEO Ramon S. Monzon said the bourse operator is optimistic that ALI’s REIT offering will have a “positive multiplier effect on the economy.”

“We are pleased that AREIT has decided to pursue its IPO even under the present economic challenges… We are optimistic that the company’s IPO will pave the way for other property firms, even those that are not yet listed in the PSE, to consider listing REITs,” Mr. Monzon said.

Aside from ALI, DoubleDragon Properties Corp. earlier announced plans to do a P16.97-billion REIT offering in the fourth quarter.

Imagining a ‘better normal’ for PHL innovation

By Santiago J. Arnaiz, Mariel Alison L. Aguinaldo,
and Patricia B. Mirasol

THE FIRST CALLS for volunteers went out in early March. As local government units scrambled to respond to the spread of COVID-19 in their municipalities, nonprofit Developers Connect (DevCon) decided to mine its nearly 40,000 Facebook followers for tech developers willing to help it “hack the pandemic.”

March 15 saw President Rodrigo R. Duterte formalizing a partial lockdown for Metro Manila. Classes were suspended. Non-essential businesses were asked to close shop. Checkpoints quickly became chokepoints, throttling the government’s ability to mobilize resources through the capital. On March 16, DevCon announced that its thousand-strong global army of volunteers was hacking together four initiatives. The flagship project was RapidPass, a QR code-based mobile system for quickly processing frontliners moving through Metro Manila’s checkpoints, enabling the distribution of vital goods to those who need it.

RapidPass was formally launched on April 3, backed by the Department of Science and Technology (DoST), as well as by the Inter- Agency Task Force Against Emerging Infectious Diseases (IATF). “Hundreds of DevCon volunteers made this possible just three weeks after the quarantine,” said Information and Communications Technology Secretary Gregorio B. Honasan during the platform’s launch. “This proves to the world the triumph of the indomitable Filipino spirit.”

The system had over 300,000 users in less than a month, streamlining movement through Metro Manila’s 48 quarantine control points so effectively that Defense Secretary Delfin N. Lorenzana said he expects the security forces to deploy the system even beyond the pandemic.

RapidPass is one of the tech solutions that cropped up across the country these last few months. Another IATF-backed system, StaySafe.ph, was developed by software engineering solutions firm Multisys as the nation’s official app-based contact tracing platform. Futuristic Aviation and Maritime Entreprise, or FAME, received funding from the DoST to fabricate specimen collection booths, producing and distributing 132 units in Department of Health (DoH)-designated facilities. Thinking Machines, a data science consultancy firm, was similarly tapped by both the DoH and DoST to “deliver quality insights to government agencies and the public to best respond to the pandemic.”

These collaborations don’t stop at the national level. Medical imaging firm Lifetrack Medical Systems has begun working with local government units, offering its CT scan analysis services for free, promising to expedite the process of identifying potential COVID cases. As pressure mounts on the education sector to digitize, startups like DCLA, a gamified e-learning platform, have begun offering their digital solutions for struggling schools — allowing them to manage enrollment and payment systems online, digitize their curricula, and even access comprehensive training and certification programs on online teaching for their staff.

Across industries, startups and tech firms have taken the initiative to address the nation’s most pressing issues. The glaring gaps that COVID-19 has exposed span not only our healthcare systems, but also our infrastructure, logistics, and financial systems. In response, the innovation community has mobilized, partnering with the public sector to plug the gaps and reconnect a socially distanced nation. While the long-term impact of these initiatives remains to be seen, some experts believe that, should the embracing of these tech community-led efforts be sustained, it may trigger an innovation renaissance.

INNOVATING THROUGH CRISIS
In its Global Ecosystem Report 2020, research center StartupBlink analyzed the startup ecosystems of 1,000 cities across 100 countries, and found that in the efforts to develop innovative solutions around COVID-19, Manila ranked 64th. Among the hundred countries analyzed, the Philippines ranked 29th. While cross-sectoral projects like RapidPass, StaySafe.ph, and the like contributed greatly to those rankings, the study highlights a number of factors that make the Philippines such a hotbed for innovation — many of which predate the pandemic.

Whether it’s embracing fintechs like PearlPay or UnionBank to raise financial inclusivity, or looking to digital platforms like PayMaya to streamline LGU operations, the Philippines has a long track record of turning to the innovation community for tech-driven solutions. But it isn’t only partnership opportunities being extended to these startups. Over the years, government agencies have built a robust support system to help them grow.

“The first thing is just the formal recognition that startups need to be nurtured, prioritized, and separated from the traditional MSME,” said Katrina Chan, executive director of QBO Innovation Hub. “They’ve put in resources, funding, mentorship — all of these activities are very much supported by the government.”

QBO itself was one of the first examples of collaboration between the government and the private sector, being one among a number of groups supported by the DoST’s Technology Business Incubation (TBI) program. Since 2009, 30 of these industry-based TBIs have been established all over the country. Through collaborations with higher learning institutions and global startup incubators, the DoST has directly invested over P413 million in the innovation community, helping the 556 startups it has incubated create a total of 1,960 jobs, secure P506 million in private investment, and generate P423 million in revenue.

According to Ms. Chan, even through the current crisis, the government has continued to bank on this community. “Across-the-board, in order to be able to fund the coronavirus (response), the government has had to cut its budget on literally everything,” she said. “But even in IATF meetings, it’s been recognized… that supporting startups and our innovative technology companies are going to be a priority, and so the funding for these programs wasn’t touched.”

Rowena L. Guevara, Science and Technology undersecretary for research and development, affirmed this policy, saying, “the startup community will be the main movers in the new normal since they are agile and fast. Startups may provide solutions to problems in logistics, supply chains, work-from-home challenges, etc. and they are assured of government support through the implementation of the Innovative Startup Act where the DoST, the Department of Trade and Industry (DTI), and the Department of Information and Communications Technology (DICT) were tasked to provide programs, benefits, and incentives for startups.”

Signed on Nov. 22, the implementing rules and regulations of the Innovative Startup Act promise to incentivize and empower the proliferation of innovative tech firms across the country, with a goal of generating 1,000 startups by 2022.

As with most developing nations, the Philippines suffers from a wealth of interlocking problems. But these present opportunities for innovative companies to enter the fray.

In Rwanda, a lack of infrastructure (e.g. power lines, airspace control, commercial flights) has made the nation a hotspot for the global drone industry. A Red Cross study published by Cambridge University Press in 2017 described African airspace as “less cluttered with flights that have slowed the adoption of commercial drones in North America and Europe.” There, drones are deployed not only as a means for monitoring and data collection, but also as the primary logistics channels for humanitarian efforts, bridging the last mile to bring blood and other medical supplies to remote communities.

By leveraging this relationship between humanitarian crises and solution-driven innovation, Rwanda has managed to establish itself as Africa’s drone capital, incentivizing the adoption of these technologies through legislation and tech-friendly regulations.

Keller Rinaudo, CEO and founder of Zipline, one of the firms spearheading drone-based logistics to solve Rwanda’s health gaps, told BusinessWorld that “it is precisely the countries that embrace innovation that will end up leapfrogging even developed nations.” Looking to find new applications for its innovations, Zipline has recently expanded into the Philippines, recognizing its potential as a base of operations for Southeast Asia.

CO-CREATING A ‘BETTER NORMAL’
But adopting new technologies simply for the sake of innovation poses its own set of risks as well. The “fail fast, fail early, and fail often” mentality that drives much of the global tech community stands in direct contrast to the slow, deliberate pace of governance. Where failure might present opportunities to learn for a lean startup, it takes on a different weight when it comes to government projects.

In a lengthy post shared on his personal Facebook page, former DICT undersecretary for operations Eliseo M. Rio, Jr. warned of the wasted resources and potential harm the IATF’s adoption of StaySafe.ph might cause. Echoing IT experts wary of the data privacy concerns surrounding the contact tracing platform, he said that in their haste to put out and endorse a tech solution to the pandemic, the task force failed to allot enough time to complete the comprehensive tests needed to ensure its security and compliance with data-privacy regulations.

Mr. Rio said it was this stance on the StaySafe.ph project that ultimately lost him his post at DICT, though these allegations have been denied.

For all the traction and support structures already in place, the innovation community is still young by global standards. Just as COVID-19 has revealed the glaring gaps in our nation’s infrastructure, so has it revealed the gaps in its ability to support the firms innovating at the grassroots.

According to James Lette, executive director of the Manila Angel Investors Network (MAIN), these gaps are most evident in the funding opportunities currently available to our nation’s startups. On the long list of priorities the government needs to address in its COVID-19 response, Mr. Lette says that startups rightfully trail behind the health and livelihoods of the Filipino people. But that doesn’t mean that startups are going to keel over and die.

“I’ve been told of one startup that had an annualized revenue of over $1 million per year, but following lockdown, it saw revenue collapse to almost zero overnight,” Mr. Lette said. “This global health crisis that this pandemic has wrought is now not simply a health crisis, it’s become this economic calamity.”

Mr. Lette said these kinds of dramatic crashes not only lead to staff layoffs, but also flow-on effects throughout the ecosystem, such as other companies reliant on them no longer being able to use their services. While the IATF has outlined at least 19 public-sector programs tailored towards assisting MSMEs through COVID-19, Mr. Lette believes that they just don’t meet the needs of startups.

“Startups take large risks with new and experimental business models,” he said, pointing out that there simply is no way for programs designed for traditional MSMEs to properly service them. “These 19 programs provide fantastic and much-needed assistance to the backbone of the Philippine economy, but through their targeting, they exclude the majority of startups.”

While the government has recognized this and begun taking strides towards plugging these gaps through legislation like the Innovative Startup Act, the clock is ticking for grassroots innovators. Immediate action is needed, and the slow, deliberate pace of the public sector may not get the job done in time.

As the executive director of MAIN, Mr. Lette has proposed establishing a government-partnered facility to issue bridge financing for tech startups. In these high-risk times, he argues that the government can do a lot to help mitigate those risks and allow private investors to step in where they can’t towards supporting the nation’s fledgling startups.

“People know that startups have a high chance of failure under normal conditions, so it’s a fair question to ask why we should save them, and why we shouldn’t just let them fail,” he said. “But startups are more than just businesses. They are a driver of economic innovation. If nothing is done and the startups are left to fend themselves, our greatest concern is that the startup economy of the Philippines will be severely weakened. The number of years and the level of investment that has gone into building the community to the point where it is now is going to be lost.”

Times of crisis are a powerful motivator for innovation, and these last few months have seen the local community rising to meet the pandemic head-on.

“You can look back at the last global financial crisis and see that there’s opportunity in this moment,” Mr. Lette said. “It was during the last recession that some of the world’s unicorns (companies valued at over $1 billion) were founded. What survives through this process proves the grit of its founders.”

While the government has shown a clear interest in embracing these initiatives, only time will tell if these firms will live long enough to see the fruit of their efforts. Today, the innovation community stands at a crossroads. Will COVID-19 be the final curtain call on a generation of startup enterprises, or will it be the dawn of a new era for innovative entrepreneurship?

Your flight will not be boarding soon

By Arjay L. Balinbin, Reporter

On June 6, a healthy baby boy named Pali was born on a Philippine Airlines (PAL) flight between Dubai and Manila.

“The name combines PAL and Ali, which means ‘most esteemed’ in Arabic,” PAL Spokesperson Cielo C. Villaluna said on her Facebook page.

It’s a rare bit of good news for airlines everywhere, which have been devastated by the pandemic as borders close and fearful travelers cancel their plans. The lockdown in the Philippines also focused on Luzon, which had most of the country’s international gateways and its largest pool of travelers — devastating domestic tourism as well.

The list of international industry titans that required bailouts is sobering, led by Singapore Airlines Ltd.’s $13 billion. Deutsche Lufthansa AG’s package from the German government is about $10.1 billion. Hong Kong’s Cathay Pacific Airways Ltd. secured a $5 billion bailout.

It’s not yet clear how much the airline industry in the Philippines will receive, but the size of the ask is staggering — P8.6 billion a month, according to an industry proposal before Congress.

Air Carriers Association of the Philippines Executive Director Roberto C. O. Lim told the Senate in May that the industry could lose up to $4.9 billion in 2020, with 500,000 workers at risk of displacement, he added, citing estimates from the International Air Transport Association (IATA).

ACAP’s members are PAL, Cebu Air, Inc. (Cebu Pacific), Philippines AirAsia, Inc., Air Philippines Corp. (PAL Express), and Cebgo, Inc.

“This is unprecedented for the commercial aviation industry. Its impact will last until an effective vaccine is discovered,” Avelino D.L. Zapanta, a Philippine aviation industry expert, said.

He noted the industry had survived crises before but the current one is a perfect storm, and estimated that it may take about five years for passenger demand to return to 50% of pre-pandemic levels, assuming a vaccine is available within the next two years.

ASSISTANCE
ACAP’s Mr. Lim said the industry’s bailout proposal breaks down into P1.3 billion for wage subsidies, P500 million for fees to be foregone by the government, and P6.8 billion for working capital.

He noted that airlines might be able to sustain 20-30% of their pre-outbreak network due to “lack of consumer confidence” and restrictions on domestic travel set by local government units.

Mr. Zapanta added that as it is with schools, the key to restoring confidence in air travel is a vaccine.

“Remember, that is also the apprehension of parents in allowing their children back to school. Some are saying no vaccine, no school,” he said.

Airlines started operating commercial flights in early June after quarantine restrictions were eased.

On June 4, the House of Representatives approved on third and final reading a P1.3-trillion stimulus package called ARISE (Accelerated Recovery and Investments Stimulus for the Economy) bill, the new name for what had been called the proposed Philippine Economic Stimulus Act (PESA).

Under the measure, this year the transportation industry will receive P70 billion this year, while the tourism sector will receive P58 billion.

The Transportation department said the transportation industry’s share of the package “will cover the needed assistance in the recovery of the aviation sector” including wages, fees due to governments, and working capital.

Is the rescue package enough? Mr. Zapanta said: “Any industry is dependent on demand. If the demand is not there, the rescue package will be for naught.”

He noted that the government’s intention over the short term is “to keep the industry alive by coming up with measures to protect the airlines from bankruptcy.”

Airlines also sought government credit guarantees, access to emergency lines of credit for six months of operations, and long-term facilities at below-market rates or guarantees to allow them to restructure their debt and obtain better terms from aircraft leasing companies and creditors.

They likewise sought a full waiver on all navigational and airport charges, which include airport office rentals and land leases, until the end of 2020.

Mr. Zapanta said substantial financial assistance “will be needed and more meaningful” in the medium term. “That’s five to seven years from now, when demand will return and heavy re-investment in fleet expansion is needed,” he added.

STRONGEST
Mr. Zapanta noted that both PAL and Cebu Pacific are exposed because of recent fleet expansion, suggesting they were carrying “huge liabilities” when the pandemic hit.

“Both have equity holders with deep pockets based on popular perceptions. Cebu Pacific is reported to have unloaded some aircraft already,” Mr. Zapanta said.

In a disclosure to the stock exchange on May 18, Cebu Pacific said it was undertaking an overall review of its long-term fleet plan, “notwithstanding that it already has a very conservative fleet growth plan compared to other low-cost carriers in the industry, with a five-year estimated growth of only 8-9%.”

“Cebu Pacific has begun discussions with suppliers on this overall fleet plan and schedule, to establish flexibility to adapt to current events,” the budget carrier said.

As for Philippines AirAsia, Mr. Zapanta said the low-cost airline’s future will depend on the mood of the minority shareholders, the founders of AirAsia Bhd. of Malaysia, which first developed the AirAsia brand. The Philippine arm is majority-owned by the family of Representative Michael L. Romero.

He believes PAL will have the “strongest staying power based on experience and ownership commitment.”

Asked whether low-cost product offerings can be sustained, Mr. Zapanta said: “The low-cost business model will be one of the biggest victims of the pandemic. The ability to offer low fares was based on reduced operating costs, sustained by huge demand generated by low fares. Without the demand, the low-cost carrier (LCC) equation is drastically skewed. The LCC cannot sustain low fares without low operating costs. Absence of demand makes low fares unsustainable.”

He added: “The yield per passenger from very few passengers must be able to sustain the operating cost. That means increased fares. The full-service airlines will be in better position after the pandemic.”

Mr. Zapanta said operations over the short term will be some form of full service, focused on safety.

“Once conditions normalize, the LCC might stage a comeback,” he said.

RIGHT-SIZING
PAL cut about 300 jobs in February to help it recover from its 2019 losses, which worsened in the first two months of 2020 due to the coronavirus outbreak.

PAL Holdings, Inc., the listed operator of PAL, reported a net loss of P10.31 billion last year, more than double the year-earlier loss.

PAL President and Chief Operating Officer Gilbert F. Santa Maria said in a television interview in May that the company was not in immediate danger of bankruptcy as its shareholders had injected around P15.2 billion into the flag carrier to keep it afloat.

Mr. Santa Maria said a “good chunk” of the losses last year were caused by the new lease accounting standard, PFRS 16.

Since 2017, PAL has lost a total of P17.6 billion.

In the first quarter , PAL’s net loss was P9.38 billion, more than 10 times the year-earlier level, as travel restrictions caused by the pandemic grounded its aircraft.

In March, budget carrier Cebu Pacific, operated by Cebu Air, Inc., announced that it would let go of its more than 150 cabin crew, as fewer flight staff were needed.

Cebu Pacific senior management officials also took a pay cut that month.

The budget carrier reported a net profit of P9.12 billion in 2019, sharply higher from the 2018 level, mainly driven by the passenger business , which accounted for revenue of P61.68 billion, up 13.7%.

The company registered a net loss of P1.18 billion in the first quarter.

Unlisted low-cost airline Philippines AirAsia, Inc. cut 12% of staff in June, while senior management also took pay cuts.

AirAsia said the moves will help the company ride out a prolonged period of “extremely low travel demand” while minimizing the impact on its employees in junior posts.

ACAP’s Mr. Lim said in April that airlines were losing P7 billion per lockdown month and have had to issue ticket refunds of P4 billion.

“If you aggregate the amounts for the members of ACAP, if you look at the average, the fixed cost that they incur… this is the cost that they have to pay even if they are not flying, around P7 billion a month,” he said.

Milan Fashion Week: Palazzo photoshoot is Gucci’s post-lockdown show; D&G does a live catwalk

MILAN — Gucci abandoned the catwalk for the launch of its new “Epilogue” collection on Friday, opting instead for portraits of its designers modelling their creations and a 12-hour livestream video from its campaign shoot in a resplendent palazzo in Rome.

With social distancing measures and travel restrictions preventing foreign models as well as guests from flying in, the coronavirus pandemic has forced high-end labels to throw out the traditional fashion show format.

Creative director Alessandro Michele, who took the helm at Gucci in 2015, said Friday’s event was the last in a three-part series focusing on the making of clothes and the behind-the-curtains work that goes into a fashion collection.

The livestream video of the photoshoot at the stuccoed 16th century Palazzo began at 8 a.m. (0600 GMT), and showed staff at work styling the brand’s designers as models, many wearing face masks and visors.

In a 20-minute segment to showcase the new collection, Gucci presented portrait pictures of its designers wearing the clothes they created for Epilogue, meant to be both seasonless and genderless and due to enter stores in the autumn.

Michele’s flamboyant, flowery dresses, the use of bold colors and a nod to the 1970s have helped turn Gucci, part of French group Kering, into one of the fastest-growing brands in recent years.

Friday’s show was part of a journey that “wants to generate a questioning about the rules, the roles and the functions that keep the world of fashion going,” Michele said in a statement.

Back in February, just days before the coronavirus pandemic emerged in Europe after first hitting China, Gucci’s women fashion show in Milan had featured guests entering the brand’s headquarters through the backstage area, walking past desks where stylists worked on models’ hair and makeup.

Michele has said the pandemic should trigger a rethink of the fashion calendar and how collections are presented, and announced in May that he would cut the number of yearly shows to two from five.

Months of lockdown have forced high-end fashion houses to shut shops across the globe and idle manufacturing sites, leaving them with piles of unsold stock.

Gucci’s collection was presented on the last day of Milan’s menswear fashion week, which like post-lockdown shows in Paris and London was held in mostly digital-only format, without the usual contingent of foreign buyers, media and influencers.

MASKS AND SOCIAL DISTANCING AT DOLCE & GABBANA
No air kissing and no hugs, a safely distanced front row and face masks were de rigueur as Dolce & Gabbana had to rewrite the rules of high-end fashion engagement with one of the first physical shows of the COVID-19 (coronavirus disease 2019) era on Wednesday.

Part of Milan’s otherwise digital menswear fashion week, the open-air show was attended by guests wearing face masks as models strode down the catwalk and then stood in a garden a meter apart.

It was held on the university campus of the Humanitas medical research foundation, which is trying to develop a vaccine against the novel coronavirus — a project Dolce & Gabbana are helping to fund.

Together with another Italian brand, Etro, which also held a physical show with guests earlier on Wednesday, Dolce & Gabbana’s was the first real-world fashion event by a major luxury label since the easing of lockdown restrictions in much of Europe.

Designers Domenico Dolce and Stefano Gabbana had said in the run-up that it took them a long time to figure out whether organizing such a show would be possible at all, but that they wanted to send a message of optimism and that Italy — one of countries hardest hit by the pandemic — is back in business.

As the health crisis forced luxury houses to shut shops and idle manufacturing sites, brands canceled events or opted for audience-free, digital-only formats, such as the Paris Haute Couture showcase earlier this month.

Fashion weeks are a crucial moment for designers to showcase their creations with media and buyers, and both industry leaders Italy and France hope to hold back-to-normal events in September.

Inspired by the colors of the Amalfi Coast and its sea, Wednesday’s Dolce & Gabbana spring/summer 2021 menswear show in Rozzano, south of Milan, featured 102 pieces of clothing in various shades of blue, some with prints of neoclassical statues.

It was attended by around 200, mostly Italian guests — compared with 500 or more in normal times. The usual front row of A-list foreign celebrities and large Chinese contingent of buyers, media and influencers was kept away by coronavirus restrictions on travel.

Models did not wear masks on the catwalk — the brand recently launched a collection of pajamas with matching face masks — but the two designers did for their traditional end-of-show appearance.

The show, which had suppliers working for free and was aimed at supporting Humanitas’ COVID-19 research, triggered a debate on Twitter about having a public gathering with many countries still under lockdown and lingering fears of a second wave of infections.

London-based veteran fashion journalist Luke Leitch, who made the trip to Milan, had no qualms.

“Milan feels secure, with masks and temperature checks prevalent. Great to see fashion and friends again,” he said on Instagram. — Reuters

Ayala affiliate caps offer to take over Australia’s Infigen

By Adam J. Ang

AN AUSTRALIAN affiliate company of Philippine-listed conglomerate Ayala Corp. will no longer outdo the offer of rival bidder Iberdrola, S.A. to acquire Infigen Energy, Ltd.

UAC Energy Holdings, a 75%-owned firm of Ayala-led AC Energy, Inc., will no longer alter its A$0.86-per-security offer and extend the acceptance period beyond July 24, it told Infigen shareholders via its latest supplementary bidder’s statement sent to the Australian Securities Exchange.

To recall, the company’s present offer price was raised by six cents on June 29, signaling a bidding war with Iberdrola, which immediately responded with a revised bid of A$0.89 per security, topping the former’s offer by 3.5%.

UAC Energy said it still may revise its offer before the end of the acceptance period should it receive 5% more tendered shares from its present 13.72% stake at Infigen.

Separately, Infigen maintained its position to reject the Ayala affiliate’s bid, noting the superiority of Iberdrola’s offer.

The Spanish multinational utility last week waived the minimum acceptance condition for its offer, making it wholly unconditional. It is now holding a 24.06% interest at Infigen.

Compared with UAC Energy’s payment term of 10 business days, Iberdrola will pay shareholders within five days upon their acceptance. Its offer period will end on July 30.

Moreover, the two competing bids are already cleared by Australia’s Foreign Investment Review Board.

Both firms have pounced on the renewable energy company after its security prices dropped with the fall in power prices in the country.

Iberdrola is one of the biggest energy players in the world having over 55 gigawatts (GW) of installed capacity in Spain, the United Kingdom, South America, and the United States. It serves around 34 million power consumers worldwide.

Meanwhile, UAC Energy is 75% owned by AC Energy. The remaining 25% is held by UPC\AC Renewables Australia, a joint venture of the Ayala unit and Hong Kong-based UPC Renewables Group.

Ayala Corp. has said that the Infigen investment is a “crucial move” for AC Energy’s regional expansion as it aims to boost its renewables portfolio, filling half of its target 5 GW by 2025.

Closed borders and strandings are keeping travelers wary: Here’s what the industry needs to do to win them back

By Luz Wendy T. Noble, Reporter

WHEN the border closures were announced, Krysten Mariann Boado was in Kyrgyzstan, two years and 15 countries into her goal of traveling across half the planet.

Up to that point, Ms. Boado had been stuck in the country for eight months, well beyond her original plan of visiting friends briefly, which had been prolonged unexpectedly by ovarian surgery.

With the intention of avoiding visa complications that might derail her plans to travel elsewhere, she faced a mad dash to the Kazakhstan border.

Which was closing in 24 hours.

Her only mode of transport? Hitchhiking.

“This was one uncertainty that I couldn’t prepare for… I could have been be a carrier (of the coronavirus),” Ms. Boado said in a Zoom interview, expressing her dread at having to cut the journey short and head home.

While Ms. Boado’s case is extreme, stories of tourist strandings during the pandemic and desperate attempts to find “sweeper flights” back home have become a staple of traveler horror stories, which are adding an unwanted layer of fear to the already-worrying prospect of crossing an international border, with all that entails — including being turned back or detained in quarantine.

OBSTACLES TO REVIVAL
With tourism hanging by a thread, the Philippines is grappling for a way to resuscitate the visitor trade, and has had to contend with local governments playing by their own rules.

Tourism Secretary Bernadette Romulo-Puyat, in a text message, said: “Local government units (LGUs) are not yet keen on opening their destinations because they are still preparing and implementing the safety protocols and measures for the welfare of both tourists and citizens.”

While the snags are worked out, tourism businesses are waiting for the visitors to return. Some have proved unable to wait any longer.

Maria Monina Atienza-Santos, a Siargao spa operator, had to let go of her staff after a long closure dictated by the lockdown.

“After I gave them financial assistance, I told them to wait until the situation improves,” she said in a Facebook message, adding that she still needs to pay rent despite the closures.

Ms. Santos also operates a cafe, which remains closed, and a laundry, which has reopened.

“Stranded tourists are not much inclined to use laundry service. We have had between two and five clients compared with 20 on a normal day. Residents have used the service much less since the crisis,” she said in Filipino.

Ms. Santos said she has yet to receive aid from the Department of Tourism or the LGU. At the top of her wish list right now is a 50% rent discount.

“We are in danger of losing everything that we worked for… Rather than accumulate debt, we might have to let go of the business,” she said.

IN LINE FOR AID
Tourism, one of the hardest-hit industries worldwide alongside restaurants and airlines, is currently front and center for governments considering massive stimulus packages.

So far, the industry has been aided only indirectly in the form of wage subsidies for all small firms, according to Tourism Congress of the Philippines President Jose C. Clemente III.

In Manila’s walled city, some other workers who depend on the visitor trade have also received relief measures, according to Intramuros Administrator Guiller B. Asido.

“We assisted 190 people (pedicab drivers/vendors/tour guides) through our endorsements to DoLE (the Department of Labor and Employment) and NCCA (National Commission for Culture and the Arts) since March,” Mr. Asido said in an e-mail.

In addition, Mr. Asido said the Intramuros Administration has also been working with government agencies and non-government organizations find alternative sources of income while visitor restrictions are in place.

WAITING FOR VISITORS TO RETURN
But relief measures are no substitute for the return of actual visitors and free-spending, adventurous locals.

The Department of Tourism (DoT) estimates first-quarter tourism revenue at P85 billion, down 25% from a year earlier, with the second quarter, during which most of the hard lockdown on Luzon took place, expected to be even worse.

“Second quarter figures will be worse as they will reflect at least 1.5 months of the Luzon-wide lockdown, with other stay-at-home policies in other provinces and regions. International and domestic tourism has been halted totally,” Asian Institute of Management (AIM) economist John Paolo R. Rivera said in an e-mail.

Mr. Clemente, who is also president of travel agency Rajah Tours Philippines, Inc. said beyond wage subsidies, the travel industry is hoping for the passage of laws that will stimulate actual business recovery.

“We are waiting for the passage of Bayanihan 2 and ARISE (Accelerated Recovery and Investments Stimulus for the Economy) bills for fiscal measures meant to ensure business continuity,” Mr. Clemente said.

Bayanihan 2, the sequel to the initial aid package known as the Bayanihan to Heal as One Act, allocates P10 billion for the tourism industry while ARISE sets aside P58 billion for the sector.

Mr. Clemente said the industry has also asked for tax breaks to help it recover from the lockdowns.

“Most stakeholders are MSMEs (micro-, small, and medium-sized enterprises) so one can imagine the financial burdens at the moment,” he said.

His realistic scenario for a tourism industry bounce-back timeline is 12 to 18 months with a vaccine, and 18-24 months without one.

SAFETY
For outbound travelers, the main issue is how to stay safe — and destinations must figure out how to strike a balance between safety and convenience, though safety currently has the upper hand.

“The number one concern for tourists when traveling in a post-lockdown world would be safety. They believe that stringent health measures are an indication that a country or destination is safe, which will in turn build their confidence when traveling,” Ms. Romulo-Puyat said.

The DoT has released provisional accreditation guidelines for tourism-related enterprises including travel and tour services, transport services, operators of recreational activities connected to tourism, restaurants and shops, to ensure that they will follow safety protocols from the Department of Health.

DoT-accredited restaurants, for one, will only be allowed to operate with a 50% seating capacity in a “new normal” scenario, with their food safety practices, disinfection, and employee health monitored.

Mr. Clemente said such requirements will inevitably impose costs on businesses, and some might not be in a position to comply.

“Companies have to examine how viable their operations are and may need to make very hard decisions whether to continue or fold,” he said.

Mr. Clemente said the industry will have to be more flexible on cancellations, rebookings and refunds to stand out.

AIM’s Mr. Rivera said the new business environment will force the industry to be more agile in dealing with the stricter social distancing and sanitation requirements, but tourists may still stay away regardless of their efforts because travel is expected to become more expensive.

Ms. Romulo-Puyat said according to an industry survey, respondents planning to travel after the lockdown favor beach destinations, followed by road trips. She said the government’s plan is to get domestic tourists to explore nearby destinations to kick-start the industry in the early phases of reopening.

“We are seeing an increasing interest in farm tourism, hiking, and health and wellness. Travel trends are leaning towards private tours and exclusive island getaways, influenced by social distancing measures,” Ms. Romulo-Puyat said.

EMERGING STRATEGIES
The focus on not-too-distant destinations, and the near-miss experience of surviving the pandemic, which will turn travelers’ thoughts towards sustainability, might mean some locations could be in more demand as well.

“One of the best models of sustainable tourism in the Philippines is Masungi Georeserve — they have a limit on the number of tourists they can accommodate, they do tree planting for tourists, and they patronize the community’s produce in the meals they prepare for tourists,” Mr. Rivera said.

Masungi Georeserve in Baras, Rizal, is in a conservation area along the Sierra Madre range and offers trail exploration for groups of up to 14 people.

Another emerging practice might be to limit visitors from countries or regions thought to be safe — the so-called “travel bubble” strategy.

Starting this month, the European Union will open its borders to leisure travelers from countries with low COVID-19 (coronavirus disease 2019) infections, while Australia and New Zealand are making similar plans.

Ms. Romulo-Puyat said the DoT is exploring such bubbles or green corridors within ASEAN “as soon as travel restrictions are relaxed.” “It works for us better because we are an archipelagic nation with quite a number of small island destinations that are easy to manage and contain, such as Boracay, Palawan and Bohol,” she said.

Boracay opened itself to visitors from the Western Visayas starting June 16, after the island moved to a more relaxed form of quarantine on June 1.

THE VIRTUAL VISITOR EXPERIENCE
Ms. Romulo-Puyat said the DoT has also launched a digital campaign, “Wake Up in the Philippines,” which features 360-degree virtual tours of 16 regions, and cooking videos, in a bid to keep the Philippines “top-of-mind” among travelers while physical travel remains out of reach.

Intramuros has also launched a #TravelFromHome campaign featuring photos and artwork of private citizens, as well as online heritage forums.

“The goal is to educate the public about specific topics about Intramuros and the nation, allowing them to “travel” as if doing an actual tour in Intramuros, while they are in the comforts of their homes,” Mr. Asido said.

Brown rice demand from industry buyers declines

DAVAO CITY — Supermarket sales for brown rice increased during the public health emergency, making up for the drop in demand from corporate clients, according to Sun Made Brown Rice producer Mindanao Agri Network Corp. (MANCOR).

Carlo C. Lorenzana, vice-president of MANCOR, said orders from major supermarket chains were higher during the strict lockdown months between mid-March and May.

The company also tapped online shops Pacific Bay and Hometown Grocer for distribution.

“So we were able to partly make up for the dip in (big volume) trade sales, but not completely,” he said in an e-mail interview.

Mr. Lorenzana said the boost in retail demand allowed the company to stay on time with payments to partner farmers, who needed cash as the lockdown coincided with the peak harvest season.

“We are obligated to honor our agreements with them. The core of our social enterprise where we assist farmers in planting premium palay (unmilled rice) for production of Sun Made brown… and we purchase these palay directly from them,” he said.

He added that rice farmers in general did not feel the health and economic blow of the pandemic as rural areas remained largely safe from the outbreak.

“Farmers in other areas were also able to increase the selling price of palay due to the high demand brought about by the municipal ordinances during the lockdown that restricted the selling of goods within their respective areas,” he explained.

MANCOR is currently exploring new revenue streams while adjusting to the health safety protocols in both office and mill operations.

“We view things now as the ‘next normal,’ meaning it’s the next phase of life for the whole world. So for our social enterprise, we need to adapt and evolve for the changing times,” Mr. Lorenzana said. — Maya M. Padillo

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