Philippines Update: Dept. of Agriculture to Put SRA Order on HFCS Imports on Hold

Philippines Update | March 27, 2017
Authors: Riley Smith, Elizabeth Magsaysay-Crébassa, and Evelyn Mariano
 
LOOKING AHEAD
 
 

March 28: Roundtable with PEZA Director-General Charito Plaza

March 29-30: PROTECT 2017: Doing Business Amidst New Threats

April 5-7: Mission to the 2017 ASEAN Finance Ministers and Central Bank Governors Meeting

 
THE COUNCIL'S TAKE
 
 

Department of Agriculture to Put Sugar Regulatory Administration Order on HFCS Imports on Hold
On March 24, Secretary of Agriculture Emmanuel Piñol announced that an order giving the Sugar Regulatory Administration (SRA) the authority to regulate imports of high-fructose corn syrup (HFCS) would be suspended for six months to give food and beverage companies time to make the necessary adjustments to their production lines.  However, as of March 27, the suspension order had yet to be signed and put into effect.  Secretary Piñol’s announcement came after several major companies in the agriculture and food and beverage sectors raised concerns that, if enacted immediately, the order would cause severe disruptions to supply chains and operations.  The SRA issued the order, officially designated Sugar Order No. 3 (SO 3), on February 17.  SO 3 requires that importers and cosignees of imported HFCS and chemically pure fructose be duly registered as an international trader with the regulatory body at the time of applying for the clearance or release of imported HFCS, and that importers and cosignees also meet other requirements even before having their applications accepted for processing.  On March 17, the Council sent a letter to Secretary Piñol warning that implementation of SO 3 risked disrupting supply chains and raising prices in the food and beverage sectors.  The letter also recommended that greater stakeholder consultation be undertaken for future orders.  A copy of the Council's letter can be found here.

SRA administrator Anna Rosario Paner cited cane sugar’s loss of market share to cheaper high-fructose corn syrup (HFCS), especially within the last year, as the reason for SO 3.  According to the agency, cane sugar has suffered a 33% loss of market share as a result of the importation of almost 800,000 metric tons of HFCS over the last six years.  Last year alone, HFCS imports for industrial use were estimated to be around 373,000 metric tons—an increase of just over 58% from 2015.  The SRA also blames HFCS imports for a significant drop in sugar prices; at the time SO 3 was issued, sugar cost P1,448.68 (US$28.86) per bag, down from an earlier high of over P1,800 (US$35.85) per bag.  The SRA estimated this drop in prices could result in revenue losses of as much as P20 billion (nearly US$400 million) for the current crop year.

SO 3 was met with swift criticism from sugar industry stakeholders.  In addition to criticizing the lack of industry consultation before issuing the order, stakeholders questioned the SRA’s authority to regulate a sugar substitute.  The SRA countered by pointing to the significant drop in the price of sugar and citing Executive Order 18, with gives the agency the authority to maintain a “balanced relation between production and requirement” of sugarcane “at a level profitable to producers and fair to consumers.”  While Secretary Piñol accepted the SRA’s claim that it has the authority to regulatory HFCS, he stated that he believed it was drafted without adequate industry stakeholder consultation.  The six month-suspension, which both Secretary of Finance Carlos Dominguez and Secretary of Trade Ramon Lopez support, is intended to provide extra time for such consultation, in addition to giving industrial users the time to make the necessary adjustments to their production lines.

SO 3 is not the SRA’s only recent attempt to force sugar prices back up, and the SRA is likely to increase its efforts to regulate HFCS in the run up to local elections in October.  With the aim of putting upward pressure on the price of sugar, the SRA announced on March 14 that it would allow traders and millers to export more sugar to the United States.  Sugar Order 4 allows people to export sugar that was originally intended for the domestic market to the United States, though the order only applies to sugar that is sold in crop year 2016-2017.  SO 4 is set to expire on August 31.  As a follow-up to SO 3, the SRA also plans to propose an import duty to HFCS.  Currently, China exports HFCS to the Philippines with zero duty, while sugar has a 5% import duty levied on it under the ASEAN Trade in Goods Agreement (ATIGA).  The SRA has said it would ask for an import levy on HFCS that is at least equal to that of sugar.  The SRA is also reportedly considering capping HFCS imports.  A cap of just over 280,000 metric tons has been floated, though this is just a preliminary figure.  Nevertheless, with barangay and Sangguniang Kabataan elections slated for October, the Philippine sugar industry is likely to want to take advantage of local politicians seeking votes to raise the visibility of depressed sugar prices and high HFCS imports.  Consequently, further attempts by the SRA to make it more difficult to use large volumes of HFCS over domestically-produced sugar are likely to continue.  Copies of SO 3 and SO 4 can be found here and here, respectively.

President Duterte Approves 2017 Investment Priorities Plan Focusing on More Inclusive Economic Growth
At the end of February, President Rodrigo Duterte approved the 2017 Investment Priorities Plan (IPP), the central aim of which is to promote more inclusive growth than under previous administrations by encouraging a greater distribution of investment across the country.  On February 28, President Duterte and Executive Secretary Salvador C. Medialdea signed Memorandum Order (MO) No. 12, which came into effect on March 18 and directs all government departments and agencies to issue in a “synchronized and integrated manner” the regulations required to implement the IPP.  Themed “Scaling Up and Disbursing Opportunities,” the 2017 IPP is essentially a list of investment activities that the Philippine government wants to incentivize over the course of the year.  Initially drafted by the Department of Trade and Industry’s Board of Investments, the IPP is based off of the government’s dual goals of achieving 7-8% GDP growth from 2018 to 2022 and reducing poverty from over 21% in 2015 to 14% in 2022.  The IPP lists the following industries, sectors, areas, and activities as priorities for investment:

  • Manufacturing, including agri-business
  • Agriculture, fishery, and forestry
  • Strategic services
  • Infrastructure and logistics, including local government unit public-private partnerships
  • Health care services, including drug rehabilitation
  • Mass housing
  • Inclusive business models
  • Environment and climate change
  • Innovation drivers
  • Energy
  • Export businesses, including services, and activities that support exporters
  • Activities based on special laws that grant incentives, such as the Philippine Mining Act of 1995 and the Renewable Energy Act of 2008
  • Autonomous Region in Muslim Mindanao

Unsurprisingly, several of these priorities align with major domestic and economic initiatives, most notably the government’s anti-illegal drug crackdown—as seen in the inclusion of drug rehabilitation centers and services—and the government’s 10-Point Socioeconomic Development Agenda—as seen in the inclusion of infrastructure development and rural development via investment in agriculture, agri-business, and the fishery and forestry sectors.  Through the inclusion of manufacturing and support for exporters—particularly the support geared towards micro-, small-, and medium-sized enterprises (MSMEs)—the 2017 IPP is also meant to help facilitate the “manufacturing resurgence” that the Philippine Development Plan (PDP) 2017-2022 aims to foster.  The PDP 2017-2022 was itself approved by the National Economic Development Authority (NEDA) on February 20.  A copy of the 2017 IPP can be found here, a copy of MO No. 12 can be found here, and a copy of the PDP 2017-2022 can be found here.

 
ADVOCACY UPDATE
 
 
On February 17, the Sugar Regulatory Administration (SRA) issued Sugar Order No. 3 (SO 3), which gives the SRA authority to regulate imports of high-fructose corn syrup (HFCS).  The SRA has blamed increasing HFCS imports for depressing the prices and demand for domestically-produced sugar.  In response to SO 3, the Council sent a letter to Secretary of Agriculture Emmanuel Piñol warning him that implementation of SO 3 risked disrupting supply chains and raising prices in the food and beverage sectors. The Council's letter also recommended that greater stakeholder consultation be undertaken for future orders.  More information on SO 3 can be found in the Council's Take above.  A copy of the Council's letter to Secretary Piñol can be found here.  
 
IN THIS UPDATE
 
 
Duterte wraps up southeast Asia tour in Thailand

National Affairs
Philippine President Rodrigo Duterte reignites martial law fears
House to tackle federalism next
Church rallies faithful vs death penalty
Duterte faces first impeachment complaint
CA bypasses Lopez, Ubial, Taguiwalo, Mariano
House purge: GMA ousted
Rody, PDP-Laban push federalism anew
Enrique Manalo: Son of envoys, now father of DFA
Yasay booted out of Foreign Affairs
Duterte appoints a new acting secretary at DFA
Duterte signs 2017 Investment Priorities Plan
Citing lack of proof, Philippine senators end Duterte 'death squad' inquiry
Senate ousts Drilon, LP senators from key posts
Leading critic of Philippine leader Rodrigo Duterte arrested
Duterte Relies on Childhood Hunting Buddy to Fund Drugs War
Philippine power struggle as Duterte battles drugs war claims

Customs
BOC eyes creation of maritime trading district in Manila
Government to create trade representative office
New ro-ro route expected to boost Indonesia, Philippines trade
Customs sets probe on P50-B smuggling
PH Customs closely investigates smuggling in top 3 imports

Defense & Security
US extends $1-M aid for Philippine maritime security
Agency sought to defend, develop Benham Rise
DND mulls more patrols off Benham Rise
Abu Sayyaf kidnaps 13 in Duterte's first months
PH, Malaysia, Indonesia to patrol piracy-prone waters
The Russians are coming—as investors
Japan may offer military trucks to ASEAN-
South China Sea coastguards crucial: academic

Economics
ECOP accepts new contractualization rules
House leader affirms support for tax reform package despite setback
Abolish VAT to plug tax leakage–Alvarez
Labor dep’t spells out contracting curbs
‘Hot money’ flees as gov’t cracks down on mines
BSP finally breaks five-year string of losses
Duterte steps in for tax reform
Duterte’s Asian push boosts PHL investments—Dominguez
Duterte’s tax-reform plan back to the drawing board
All set for the new Philippine Development Plan
Asia's Ugly Duckling of the Year Is the Philippine Peso
DTI, P&G tie up for MSME program

Energy
PNOC gets 27 proposals for LNG terminal project
Energy Logics Philippines eyes additional supply to Luzon Grid
BCPG signs deal to buy stake in Philippines wind power plant
P9.75-B solar power project breaks ground
Mining issues cloud Phl competitiveness
LNG project offers flood PNOC
Villar urges dev’t of downstream mining industry
DoE wants fast track for P3.5-B power projects
Philippines' Duterte wants mining ban, links miners to destabilization plot
CA: Gina acting ‘above the law’
PH, Japan to prioritize RE projects in Mindanao
Philippine minister asks Duterte to halt second mine review she earlier supported
Philippines to get P75-B power plant investment from Japan
Philippines may consider ban on exports of unprocessed minerals
Philippines looking at ban on ore exports in reform push, nickel jumps
Duterte signs Paris deal
BoI approves P1.2-b biomass power plant
BIMP-EAGA tackles Sabah-Palawan energy connectivity
Cusi wants to convert Malaya Thermal Power Plant into LNG plant
Solar firm to debut battery storage
National Transmission Corp. wants bigger role in energy planning
Energy Department, PEZA ink deal on ecozones investment
Speaker Alvarez files bill scrapping ERC, proposes formation of Board of Energy

Financial Services
Philippines starts opening bank sector to Asean peers
House OKs bill regulating online payments
Antimoney laundering rules tightened
House bill on BSP regulation, supervision of payment systems hurdles 2nd reading
Landbank pushes rural bank consolidation
Corporate governance reforms in the Philippines

Food & Agriculture
Coca-Cola Philippines to buy more local sugar: Piñol
Sugar regulator proposes import duty on corn-based sweetener
PCA chief suspended over corruption allegations
SRA defends order regulating entry of imported fructose
Sugar authority’s bid to regulate corn syrup imports hits snag
Senate eyes probe vs ex-B.I.R. chief linked to fake stamps
PHL meat imports rose to record high in 2016
Rice output seen hitting 4.44 MMT in Q1, up 13%
4Ps beneficiaries to receive rice subsidy in March
China to buy $1.7bn worth of Philippine agricultural produce
DA, DILG, MMDA, PNP sign MoU on 'food lane routes'
SRA allows more sugar exports to US
Taiwan-Philippines fishery meeting sees agreement on proposals
SRA asks Trade dep’t to drop retail price of cane sugar
Japan going bananas for Philippine food exports as trade chiefs eye record business at FoodEx show
Land laws need to be harmonized
Australia investment body scouting for Mindanao agri, education opportunities
Duterte mulling halt in conversion of agri lands
Illegal-fishing activities in Negros Occidental down by 90%–official
Sugar industry regulator intervenes to restrict imports of corn syrup
DA 7 to scrap irrigation fees for farmers in Cebu, Bohol
Stakeholders want QR on rice extended
Crop insurance paid to farmers reached P1.6 billion in 2016
Strategic directions for Philippine agriculture
Thailand's biggest agri company to invest $2B in PH within 5 years

Health & Life Sciences
Air ambulance launched for remote Philippine areas
Pioneering ICT-based healthcare solutions at the National Telehealth Center, Philippines
Surgeon to head PhilHealth
Colorectal cancer now Philippines' number 1 cancer
Dineros named Interim PhilHealth President and CEO
Doctor shortage
PH continues work with USAID despite Duterte’s tirades

ICT
Data Processing Systems Registration Due in 6 Months
Smartphone boom driving jump in digital payments in the Philippines
Many PH firms unprepared for cyber attacks – SGV
Duterte to revive NBN; ZTE keen to help again
Duterte approves national broadband plan
Latest Regulatory Changes Give Bitcoin Startups in the Philippines A Chance to Survive
House to summon FB, Twitter execs
Amdocs to expand local market reach | BusinessMirror
Grab extends GrabShare carpooling service to Malaysia and the Philippines

Infrastructure
Closure, redevelopment of Naia pushed
Phl, China sign joint dev’t plan
WHILE BOOSTING BANKING, INSURANCE SECTORS: Big-ticket infra projects to create jobs, fuel economy | Malaya Business Insight
P326 B infra projects on stream
PNOC gets 26 unsolicited offers for LNG hub | Malaya Business Insight
New fund sources open up for PH
Philippines: First Metro Manila Bus Rapid Transit Line to Benefit Thousands of Commuters Daily
DPWH oversees NLEX-Harbor link project | BusinessMirror
Infra spending to hit 7.4% of GDP by 2022–Pernia
Insurers help to pay for Asia's infrastructure needs
LRMC ready to break ground for P30-billion LRT line to Cavite
World Bank approves $64.6M funding for Manila's BRT line
P326-B infrastructure projects start this year
5 regional airport PPP deals attract more honchos
Bundle… unbundle
Gov’t sets infra links for 12 industries | Malaya Business Insight
San Miguel's Ang Offers $14 Billion Airport for Manila

Manufacturing
Foreign investments seen to sustain upsurge
DTI Rejects Car Industry’s Tax Hike Counterproposal
 
ARTICLE CLIPS
 
 
Regional Affairs

Philippine ministers cry foul over China’s island plans Financial Times 22nd Mar 2017
Fears of a Chinese plan to build a radar station on a disputed ocean outcrop have laid bare tensions in the Philippine government over President Rodrigo Duterte’s campaign to woo Beijing. Enrique Manalo, the Philippines’ new foreign secretary, said on Wednesday his country had sought clarification from China over the purported plans. On Tuesday Mr Duterte’s justice minister warned that Manila would launch a formal protest against the proposal, which was announced by a regional Chinese official but has since been denied by Beijing.  The rhetoric from Philippine cabinet ministers is tougher than the president’s own initial comments that his country could not stop China from pressing ahead with plans to build an environmental monitoring station on Scarborough Shoal. Mr Duterte’s diplomatic tilt towards Beijing and away from Manila’s traditional ally Washington has been a key plank of his foreign policy — and has shifted the security balance of Asia’s contested seas. The outcrop has been a source of fierce argument between the Philippines and China since an effort at detente broke down under the previous government in Manila in 2012. Relations between the two countries plunged further when the Philippines mounted a case at an international court in The Hague against Beijing’s sweeping South China Sea claims. The court ruled in Manila’s favour last July. Mr Duterte appeared to distance himself from the judgment during a landmark trip to China in October, when he branded it “just a piece of paper with four corners”. Shortly afterwards, Beijing allowed Filipino fishermen to return to fish around Scarborough Shoal. 

Rody rallies for support in sea code philstar.com 21st Mar 2017
In a bid to avoid tension in disputed areas in the South China Sea, President Duterte called for support for the approval of a Code of Conduct (COC) among members of the Association of Southeast Asian Nations (ASEAN). “It’s very important for China and the rest of the nations, especially the ASEAN, to come up with a Code of Conduct,” Duterte said in a press briefing in Myanmar on Sunday night. The President also pitched for the COC while he was in Myanmar, which was part of the last leg of his introductory tour of Southeast Asia in the run-up to the ASEAN summit this November in Manila. The Declaration on the Code of Conduct of Parties in the South China Sea (DOC) was signed by all members of ASEAN and China on Nov. 4, 2002. It lists the principles of self-restraint and non-militarization. Duterte said he would invoke the arbitral ruling favoring Philippine claims if China starts gathering mineral resources from the disputed areas. But Duterte again admitted that the Philippines cannot stop China from building a radar station at Panatag (Scarborough) Shoal because the Philippine military is no match for Chinese armed forces. And he cannot allow Filipino soldiers to go to disputed areas to avoid casualties. Despite China’s excessive claims, Duterte said he is working to further bolster economic and trade ties between Manila and Beijing. Supreme Court Senior Associate Justice Antonio Carpio reminded Duterte that he has the constitutional duty to defend Panatag Shoal from Chinese incursion.

Foreign Affairs secretary says China needs PHL permit for Benham Rise “research” activities Business World 17th Mar 2017
Acting Foreign Affairs Secretary Enrique A. Manalo could not give confirmation that his department -- similar to the position of the Department of National Defense (DND) -- was informed about the President’s decision allowing Chinese vessels to undertake supposedly research activities at the Benham Rise, but nonetheless said efforts are being undertaken moving forward to protect the Philippine territory. “Of course there are ships passing through, exercising freedom of navigation, but the fact that this is a breach of sovereign rights is another thing. Any ship needs to get permission to do research,” Mr. Manalo said during a press conference yesterday, his first since his appointment to the Department of Foreign Affairs’ (DFA) top post last week. He further explained that requests to conduct research in the country’s exclusive economic zones (EEZ) such as the Benham Rise are granted to ships on a case-to-case basis. Mr. Manalo also downplayed the issue by pointing out that a Chinese official has already acknowledged that Beijing respects the sovereign rights of the Philippines in the area, which has been recognized by the United Nations. Defense Secretary Delfin N. Lorenzana was the first to bring up the matter last week as he described China’s presence at Benham Rise as “very concerning,” noting that the Chinese ships “sometimes” stayed for as long as a month in search of areas there to park their submarines. Mr. Manalo assured that the DFA will keep close tabs on developments in the area and that both he and Mr. Lorenzana have been told by President Rodrigo R. Duterte that there is a need to increase patrols in the Benham Rise.

ASEAN expects significant rise in investments Manila Bulletin Business 16th Mar 2017
ASEAN has agreed to strengthen its focus on action agenda on investments as the 10-member states expect a significant increase in investments into the region, which seeks to become a production hub and single market. This was agreed at the conclusion of the ASEAN Coordinating Committee on Investments (CCI) 69th Meeting here chaired by the Board of Investments (BOI) where the committee agreed to push the Focused and Strategic Action (FAST) Action Agenda on Investment as among the Committee’s priority deliverables for the year. BOI Executive Director Ma. Corazon Halili-Dichosa, who also served as the Philippine Head of Delegation to the CCI, said that investments among the 10 member states of ASEAN is expected to significantly increase, and linkage among ASEAN micro, small, and medium enterprises (MSMEs) with ASEAN and global multinational enterprises (MNEs) to further strengthened.

China recognizes PH rights over Benham Rise Malaya Business Insight 16th Mar 2017
Acting Foreign Affairs Secretary Enrique Manalo yesterday said China has sent word recognizing Philippine sovereignty over the 13-million hectare Benham Rise and it is not going to claim ownership of the undersea region off the coast of eastern Luzon. He said China has yet to officially respond to the DFA’s note verbale regarding the sighting of its research vessel in the area last year, but Beijing has informed the Philippines it recognizes Philippine sovereign rights over Benham Rise. “China has already informed us that they do recognize our sovereignty rights and they are not disputing Benham Rise,” Manalo said in an interview over TV station GMA News. He also said “China never sought permission” for its research vessel to stay in the area and that is why the DFA asked China for an explanation on the issue. Defense Secretary Delfin Lorenzana, on March 9, reported that for three months last year, government forces monitored a Chinese survey ship in the area. On March 13, Duterte said he allowed the Chinese surveillance ships as part of an “agreement” and that no incursion will take place. The President said he did not want to fight over Benham Rise because he wants economic help from China.

RCEP to give PHL better market access than existing trade deals BusinessMirror 16th Mar 2017
The Philippines should push for the conclusion of negotiations for the Regional Comprehensive Economic Partnership (RCEP) in this year’s annual Asean Meeting, as the deal could translate to better market access for its exporters than its existing free-trade agreements (FTA), the Asian Development Bank (ADB) said. ADB Advisor at the Office of the Chief economist Ganeshan Wignaraja said the RCEP would not be like the usual trade pacts—especially for the Philippines—where the utilization rate of market-access agreements is only 22 percent. He explained that because the RCEP covers many countries, including those that the Philippines does not have bilateral FTAs with, firms would have greater incentive to use the RCEP and benefit from it. “When you get bigger agreements, bigger parties, such as [in the case of] RCEP, my expectation is utilization will rise because there’s more benefit to the firm to want to undergo the rules of origin,” Wignaraja told the BusinessMirror. However, the gains to be made in the RCEP, particularly where the Philippines is concerned, will not be immediate. Along with efforts to push the conclusion of the RCEP, Wignaraja said the Philippines must implement domestic reforms to make it more competitive should the RCEP be signed.  These reforms include improving infrastructure and social-safety nets, as well as technical and financial support for small and medium enterprises (SMEs). Recent developments in the region, such as the warming of relations between China and the Philippines, could encourage some manufacturers to locate in the country. In this way, the Philippines stands to benefit from the windfall of Chinese investments, and this is always good for a country whose foreign direct investments have not been that high. Wignaraja said the conclusion of the RCEP would also make even the United States take a pause on its “America First” policy.

Wary of China, Duterte tells navy to build 'structures' east of Philippines Reuters 13th Mar 2017
Philippine President Rodrigo Duterte has ordered the navy to put up "structures" to assert sovereignty over a stretch of water east of the country, where Manila has reported a Chinese survey ship was casing the area last year. The Philippines has lodged a diplomatic protest with Beijing after the vessel was tracked moving back and forth over Benham Rise, a vast area east of the country declared by the United Nations in 2012 as part of the Philippines' continental shelf. The Philippines says Benham Rise is rich in biodiversity and fish stocks. China's foreign ministry on Friday said the ship was engaged in "normal freedom of navigation and right of innocent passage", and nothing more. Defense Secretary Delfin Lorenzana said Duterte's instruction was to increase naval patrols in that area and put up structures "that says this is ours". He did not specify what structures would be erected. "We are concerned, they have no business going there," Lorenzana told reporters late on Sunday. Lorenzana last week said he was suspicious of China's activities near Benham Rise and suggested they might be part of surveys to test water depths for submarine routes to the Pacific. Asked during a news conference what his instruction was to the navy concerning Benham Rise, Duterte said the Philippines had to assert itself, but gently.

China ships in PH-owned Benham Rise, scouting for subs' parking sites - DND InterAksyon.com 9th Mar 2017
China may be casting a covetous eye on Benham Rise, over which the Philippines has undisputed claim in the United Nations, with a possible agenda: scouting for sites to park its submarines, the Department of National Defense (DND) hinted Thursday. If unchecked, said DND, this foray could become another source of conflict between the Asian neighbors, who had already tangled earlier in the UN Permanent Court of Arbitration (PCA) where Manila complained against Beijing's "excessive" claims in the South China Sea with its nine-dash line claim. Defense Secretary Delfin Lorenzana made the revelation on China's forays in the Benham Rise area at a threat assessment forum in Camp Aguinaldo on Thursday. According to him, Chinese ships have been spotted in the area located in Northeastern Luzon. Lorenzana said satellite photos and incident reports provided the basis for his alert.While the motivations for the reported Chinese survey have yet to be confirmed, Lorenzana said reports reaching him showed the Chinese could be scouting for a spot to place their submarines.

Duterte wraps up southeast Asia tour in Thailand philstar.com 22nd Mar 2017
Philippine President Rodrigo Duterte met Tuesday with Thai Prime Minister Prayuth Chan-ocha, completing a series of get-acquainted visits with the members of the 10-country Association of Southeast Asian Nations, which the Philippines is chairing this year. During Duterte's visit, the Philippines and Thailand signed agreements on cooperation in agriculture, tourism, and science and technology. It was Duterte's second trip to Thailand since becoming president last year. He visited Bangkok last November to pay respects to Thailand's late King Bhumibol Adulyadej, who died at age 88 after a 70-year reign.

National Affairs

Philippine President Rodrigo Duterte reignites martial law fears The Straits Times 23rd Mar 2017
Philippine President Rodrigo Duterte warned on Thursday (March 23) he may impose martial law and suspend elections for tens of thousands of local posts, fuelling concerns about democracy under his rule. Duterte said he's considering both measures as part of his controversial campaign to eradicate illegal drugs in society, and that martial law would solve a range of other security threats. "If I declare martial law, I will finish all the problems, not just drugs," he told reporters in a pre-dawn briefing after returning from neighbouring Thailand, which is under military rule. Duterte said that as part of martial law, he may create military courts to hear cases against terrorists. Since easily winning presidential elections last year and taking office nine months ago, Duterte has given conflicting statements on whether he intended to impose military rule. The issue is highly sensitive in the Philippines, which is still trying to build a strong democracy three decades after a famous "People Power" revolution ended Ferdinand Marcos's dictatorship. Duterte has previously warned he would be prepared to defy constitutional safeguards and restrictions on martial law, although he and his aides have later sought to downplay those threats. Duterte also said he was planning to appoint leaders of more than 42,000 districts, known as barangays, across the nation instead of having them elected in polls that were scheduled for October. The elections, which by law should be held every three years, are important to the Philippines' democracy because the barangays are the smallest government unit responsible for a wide range of local services.

House to tackle federalism next philstar.com 20th Mar 2017
Federalism will be the next order of business at the House of Representatives after tackling the death penalty.  Speaker Pantaleon Alvarez hopes President Duterte will soon appoint the members of the constitutional commission – which may be led by retired chief justice Reynato Puno – for purposes of shifting to a federal system of government.  The 25-man body will be tasked to revise the 1987 Constitution leading to replacement of a highly centralized presidential government with that of a federal and parliamentary system where Congress will be converted into a unicameral body.  Camarines Sur Rep. Luis Raymund Villafuerte says it is about time Congress intensifies its deliberations on Charter change to propel the country’s economic growth by ensuring equal distribution of government resources nationwide. 

Church rallies faithful vs death penalty philstar.com 20th Mar 2017
The Catholic Bishops’ Conference of the Philippines (CBCP) yesterday called on the Filipino faithful to stand up against the imminent restoration of the death penalty. For the first time collegially, the CBCP slammed members of the House of Representatives for approving House Bill 4727 last March 7. Meanwhile, Swedish Ambassador Harald Fries has conveyed his country’s disapproval of the reinstatement of the death penalty in the Philippines. He cited three reasons the death penalty is facing opposition: it goes against the right of all people to life, that is a human right for everyone regardless of what one has done; it does not decrease heinous crime, as research have shown, “so it doesn’t help in fighting crime”; and it has the terrible risk of killing someone who might be innocent, as shown in many countries that have strong judicial system. – With Ding Cervantes, Pia Lee-Brago

Duterte faces first impeachment complaint Business World 17th Mar 2017
President Rodrigo R. Duterte on Thursday, March 16, faced his first impeachment complaint, some nine months after assuming the presidency following his runaway victory in the 2016 presidential election. As Congress went on recess, the complaint was filed at the Office of the Secretary-General of the House of Representatives by Magdalo party-list Rep. Gary C. Alejano, a mutineer in the Magdalo group of then Navy officer Antonio F. Trillanes IV during the Arroyo administration. The 17-page complaint held Mr. Duterte liable for impeachment for violation of the Constitution, bribery, betrayal of public trust, graft and corruption and commission of other high crimes. Mr. Alejano said Mr. Duterte betrayed the public trust when he adopted a “state policy of inducing policemen, other law enforcement officers and/or members of ‘vigilante groups’ into Extra-Judicial Killings (EJKs) of more than 8,000 persons” suspected of being drug personalities. In a press conference after filing the complaint, Mr. Alejano said he was aware of the “uphill battle” he faced in terms of Mr. Duterte and his allies having the numbers in Congress, but still expressed confidence the complaint can gain support, with his colleagues having the time now to rethink their position. There are 267 in the House who are aligned with the “super-majority” coalition of Mr. Duterte. The complaint needs at least one-third of the chamber’s 292 members to transmit the Articles of Impeachment to the Senate, which will then hold a trial.

CA bypasses Lopez, Ubial, Taguiwalo, Mariano Rappler 16th Mar 2017
The Commission on Appointments (CA) bypassed on Wednesday, March 15, the last 4 Cabinet members needing confirmation by the powerful body. Environment Secretary Gina Lopez, Health Secretary Paulyn Ubial, Social Welfare and Development Secretary Judy Taguiwalo, and Agrarian Reform Secretary Rafael Mariano failed to get the nod of the CA on the last day of session before Congress goes on break. Lopez is facing heightened scrutiny following the filing of at least 20 oppositions against her, mostly over her closure and suspension of mining operations. Ubial is facing opposition for her stand on condom distribution. Senate Majority Leader and CA member Vicente Sotto III earlier warned that he would block her confirmation if she pushes through with her condom distribution program in schools. As for Taguiwalo and Mariano, there had been calls for the two left-leaning secretaries to resign after the peace talks between the government and communist rebels earlier collapsed. Both parties, however, said the negotiations are set to resume. Whether this would create a positive development for their confirmation remains to be seen in May when Congress resumes session. Senate President Aquilino Pimentel III, CA chairman, denied there is politics involved in the bypassing of the secretaries, saying the issue lies with scheduling. Of the 4, only Lopez has so far faced the appointments body. Malacañang said President Rodrigo Duterte would reappoint the 4 Cabinet members. In particular, Duterte has repeatedly declared his support for Lopez, even threatening to impose a total mining ban due to its harmful effects on the environment. The body has only rejected one appointment thus far: former foreign secretary Perfecto Yasay Jr, for lying under oath about his US citizenship.

House purge: GMA ousted philstar.com 16th Mar 2017
Speaker Pantaleon Alvarez and members of the super majority coalition last night made good their threat to remove former president and now Pampanga Rep. Gloria Macapagal-Arroyo as deputy speaker, along with 11 other committee chairmen of the House of Representatives who voted against the return of the death penalty. House Majority Leader Rodolfo Fariñas moved to declare the seat of Arroyo as deputy speaker for Central Luzon vacant, along with the panel headed by former actress Vilma Santos-Recto of Lipa City, Batangas – the civil service committee in the House. Among the other committees declared vacant were those of Reps. Henedina Abad (government reorganization), Sitti Djalia Hataman (Muslim affairs), Carlos Isagani Zarate (natural resources) and Mariano Michael Velarde (overseas workers affairs); Reps. Jose Christopher Belmonte (land use), Kaka Bag-ao (people’s participation), Emmi de Jesus (poverty alleviation), Emmeline Aglipay-Villar (women and gender equality) and Antonio Tinio (public information). Alvarez earlier said that aside from Arroyo, those to be replaced include Mindoro Occidental Rep. Josephine Sato, who sits in the Commission on Appointments (CA). Earlier, Sato said she would not leave her CA post even if Alvarez or Fariñas tells her to because she represents the Liberal Party (LP) in the commission. The House overwhelmingly voted to approve the death penalty bill. At least 10 of the 54 who voted against the measure hold leadership and committee assignments. There were reports that Arroyo is being groomed as the next Speaker to replace Alvarez who will be appointed as executive secretary as part of a Cabinet revamp, according to sources. The STAR source – a Cabinet official – said yesterday that Arroyo is expected to be elected Speaker when Congress convenes in May while Alvarez would be appointed executive secretary. The source said current Executive Secretary Salvador Medialdea would be appointed to a “very sensitive post” in the government.

Rody, PDP-Laban push federalism anew philstar.com 15th Mar 2017
President Duterte and his party mates in the PDP-Laban have pressed again for a shift to a federal form of government. “We are running for federalism…We are not beholden to any lobby money. Despite pressures…we stand our ground and we join the clarion call for the preservation of the Filipino,” Duterte said during a meeting with Senate President Aquilino Pimentel III and Speaker Pantaleon Alvarez at Malacañang on Monday. “Federalism is really an issue. We have no choice, we know the stakes. We know the dangers. We can project more or less what will happen if something goes awfully wrong. I don’t make dire predictions, but if we fail in my time...for sure it would tear this country apart,” the President said. Meanwhile, Pimentel urged mayors to support federalism to decentralize power from Metro Manila. He said the federal form of government that their party is espousing is uniquely Filipino because it involves a semi-presidential, executive-legislative setup that would lead to the creation of 11 regional governments. PDP-Laban is pushing for a setup wherein the president, who will remain head of state, will be elected by the people. The national assembly will elect the prime minister, who will be the head of government and have powers over matters concerning domestic policy. He said federalism would help erase the two faces of Philippine society under a unicameral government that has a highly centralized structure by allowing the neglected areas to catch up with the more affluent ones.

Enrique Manalo: Son of envoys, now father of DFA Rappler 11th Mar 2017
Foreign Secretary Enrique Manalo, who grew up in a household of ambassadors, now leads the department that his parents served. Enrique Manalo, 64, learned diplomacy at home. Manalo, the Philippines' new top diplomat, is the son of two ambassadors. Manalo, a University of the Philippines economics graduate who joined the DFA in 1979, has a compact 4-page list of credentials. This includes at least 12 long assignments abroad, and nearly two dozen international meetings, most of which he chaired. Manalo served as the DFA's undersecretary for policy from August 2007 to February 2010, under then president Gloria Macapagal Arroyo. He got the same position from April 2016 to March 2017, which covered the administrations of then president Benigno Aquino III and current President Rodrigo Duterte. He, too, served as Philippine ambassador to the United Kingdom and head of the Philippine Mission to the European Union, among others. On Thursday, March 9, Manalo took his post as acting DFA secretary after his predecessor, lawyer Perfecto Yasay Jr, was rejected by the Commission on Appointments over citizenship issues. On the West Philippine Sea (South China Sea) dispute, Manalo stressed the need "to avoid measures that would escalate tensions" in the disputed waters. On an independent foreign policy, he said, "The whole idea of this is that we are not dependent on any single country or any group of countries, but we will deal with countries on the basis of our interests, and also not at the expense of other partners."

Yasay booted out of Foreign Affairs Manila Standard 9th Mar 2017
President Rodrigo Duterte will appoint an acting Foreign Affairs secretary to replace the outgoing Perfecto Yasay Jr., who was rejected by the Commission on Appointments Wednesday for lying about his American citizenship, Presidential Spokesman Ernesto Abella said. “We respect the decision of the CA and will await the President’s appointment of a new secretary of Foreign Affairs,” Jose said in a statement shortly after the CA unanimously rejected Yasay’s confirmation for failing to disclose his American citizenship during an earlier hearing. A day after that hearing, Yasay insisted that he was a Filipino citizen. On Wednesday, Yasay maintained that he did not lie about his citizenship, saying that he merely failed to disclose some information because he was nervous. Jose said Yasay’s failure to win confirmation would have no effect on the country’s foreign relations. “The Philippines’ conduct of foreign relations will continue,” he said. “And our foreign policy remains unchanged under the leadership and direction of our President.” Jose also said any documents signed by Yasay would remain valid because he was effectively the secretary of Foreign Affairs at the time as a result of his ad interim appointment from the President. Yasay’s rejection was the first time that a nominee for the position of DFA chief failed to get the CA’s nod. He is also the first Cabinet member appointed by Duterte to be rejected by the bicameral body. Duterte has already announced that he will replace Yasay and appoint his running mate in last year’s elections, Senator Alan Peter Cayetano as the DFA chief.

Duterte appoints a new acting secretary at DFA Manila Standard 9th Mar 2017
President Rodrigo Duterte has designated Foreign Affairs Undersecretary for Policy Enrique Manalo the Acting Secretary of Foreign Affairs. This comes, following the Commission of Appointment’s rejection of the nomination of Foreign Affairs Secretary Perfecto Yasay Jr. Manalo had served as Ambassador to the United Kingdom and Belgium. He had also been the country’s Permanent Representative to the United Nations in Geneva and PH Deputy Permanent Representative to the UN in New York. He played a major role in securing the Philippines’ chairmanship of the Association of Southeast Asian Nations (ASEAN). Manalo may hold the cabinet position until May. Senator Alan Peter Cayetano may be named DFA secretary in June, when the ban for the appointment of losing candidates in the 2016 elections ends. 

Duterte signs 2017 Investment Priorities Plan Business World 7th Mar 2017
President Rodrigo R. Duterte has approved the 2017 Investment Priorities Plan (IPP), which is intended to make development more inclusive by providing incentives to better distribute investment across the regions. Signed by Mr. Duterte and Executive Secretary Salvador C. Medialdea on Feb. 28, Memorandum Order (MO) No. 12 directs all agencies to issue the necessary regulations to ensure the IPP’s implementation in a “synchronized and integrated manner,” with the order due to take effect on March 18. With the theme Scaling Up and Disbursing Opportunities, the new IPP, which is a list of priority investment activities that may be given incentives, was submitted to Mr. Duterte by the Board of Investments (BoI) on Dec. 29. The administration’s economic blueprint calls for GDP growth of 7-8% from 2018 to 2022 from 6.5-7.5% this year, with the incidence of poverty falling to 16% in 2022 from 21.6% in 2015. IPP’s foreword, signed by Trade Secretary Ramon M. Lopez, who also heads the BoI as chairman, indicated departures from the 2014 IPP “with the inclusion of more MSME (micro-, small- and medium-scale enterprises)-oriented, innovation-driven, health- and environment-conscious activities that look at expanding job opportunities for more segments of the population and bringing more firms into the local and global value chains.” Moreover, the foreword read, “there is a deliberate policy to shift investments to the countryside.” The 2017 IPP will count as “preferred” investment areas: manufacturing including agri-processing; agriculture, fishery and forestry; strategic services; infrastructure and logistics including local government unit public-private partnerships; health care services including drug rehabilitation; mass housing; inclusive business models; environment and climate change; innovation drivers; energy.

Citing lack of proof, Philippine senators end Duterte 'death squad' inquiry Reuters 6th Mar 2017
Philippine senators abruptly ended a hearing on Monday into allegations by a retired policeman that a "death squad" operated under President Rodrigo Duterte when he was mayor of Davao City, citing no proof that it even existed. Arturo Lascanas admitted to lying in October during another Senate inquiry into alleged extrajudicial killings by a hit squad linked to Duterte, but said he did so for his family's safety and because police had warned him to "deny everything". He said on Monday he had personally killed 300 people, about 200 as a member of a "Davao death squad" of which Duterte had full knowledge. But few fresh claims emerged in Monday's proceedings and the senators, several of whom are Duterte loyalists, challenged his credibility and demanded proof. "We don't see any point of pursuing the investigation," Senator Panfilo Lacson, head of the Senate panel, told reporters. "There's no independent evidence other than what he had already testified on." Human rights groups documented about 1,400 suspicious killings in Davao while Duterte was mayor and critics say the war on drugs he unleashed as president has the same hallmarks. More than 8,000 people have been killed since Duterte took office eight months ago, mostly drug users killed by mysterious gunmen in incidents authorities attribute to vigilantes, gang members silencing informants, or unrelated murders. Police reject activists' allegations that they are behind most killings and say they are responsible for 2,555 of the deaths, when suspects had resisted arrest. On Monday, dela Rosa announced the re-launch of police anti-narcotics operations after a month-long suspension of police involvement in the campaign.

Senate ousts Drilon, LP senators from key posts Rappler 27th Feb 2017
The Senate on Monday, February 27, stripped 3 Liberal Party senators and their ally of committee chairmanships, following the arrest of their party mate Senator Leila de Lima. The revamp prompted the LP senators to shift to the minority bloc. It was neophyte senator Manny Pacquiao, a key administration ally, who motioned to remove from key positions LP senators Franklin Drilon, Francis Pangilinan, Paolo Benigno Aquino IV, as well as Akbayan Senator Risa Hontiveros. Akbayan is allied with the LP. Drilon was removed as Senate President Pro-Tempore, Pangilinan was relieved as agriculture committee chairman, and Aquino was sacked as education committee chairman. Akbayan's Hontiveros was also removed as health committee head. As Senate President Pro-Tempore, Drilon was the 2nd highest Senate official and an ex-officio member of all standing committees in the chamber and in the powerful Commission on Appointments. Replacing Drilon as Senate President Pro-Tempore is Senator Ralph Recto, who used to be the Senate Minority Leader. Drilon, however, remains to be the chair of the Senate committee on constitutional amendments. Senator Francis Escudero also left the minority bloc as he replaced Aquino as the new education committee chairperson. Aquino is still the head of the committee on Science and Technology. President Rodrigo Duterte's close allies, Senator Cynthia Villar and Senator Joseph Victor Ejercito, are the new agriculture and health committee chairpersons, respectively. Villar replaced Pangilinan while Ejercito replaced Hontiveros. The revamp came after De Lima's arrestlast Friday, February 24, and the 31st anniversary celebration of the EDSA People Power Revolution last Saturday, February 25, which was attended by the ousted senators all clad in black.

Leading critic of Philippine leader Rodrigo Duterte arrested Financial Times 24th Feb 2017
A Philippine senator who has led opposition to President Rodrigo Duterte’s bloody war on drugs has been arrested in a case she claims has been trumped up to silence her. Leila de Lima was led away from her office by law enforcement agents on Friday after a court ordered her detained on charges that she received pay-offs from jailed drug dealers. Ms de Lima, who was justice secretary in the previous government, is the highest-profile critic of Mr Duterte to be targeted since he took power in June. Authorities maintain their case against the senator is credible and not politically motivated. A court ordered Ms de Lima’s arrest on charges filed by the Department of Justice that she had received 5m pesos ($99,000) from jailed drug lords through a former prison official. The official and a man who was Ms de Lima’s former driver, bodyguard and lover have also been indicted. Ms de Lima is a long-time foe of Mr Duterte, who has previously accused her of taking money from drug dealers. She led inquiries into drug wars he launched first as mayor of the southern city of Davao and then nationally after he become president. More than 7,000 people are estimated to have died in his latest anti-narcotics campaign in less than eight months, thousands of them at the hands of vigilantes and other unknown killers.

Duterte Relies on Childhood Hunting Buddy to Fund Drugs War Bloomberg.com 23rd Feb 2017
Before his childhood friend Rodrigo Duterte decided to run for president of the Philippines, Carlos “Sonny” Dominguez used to spend his days hunting a white-tailed deer in Idaho and watching episodes of “Narcos” on Netflix. Now, instead of following the escapades of narcotics kingpin Pablo Escobar on TV, he has a drug war at home to pay for. As Duterte’s finance minister since last year, it’s Dominguez’s job to ensure his old companion can afford to implement election promises to wipe out drug dealers and boost police pay, while cutting income tax and finding billions for infrastructure projects. To raise the money, Dominguez is pushing for a package that will raise levies on automobiles and fuel to boost annual revenue ultimately by 162.5 billion pesos ($3.2 billion). Politicians want only the populist measures passed. “You have to have an agenda, finish it, then go,” said Dominguez, who, like Duterte, is 71. It’s a mantra that he’s repeated many times in a career that spans half a century and includes top jobs at some 20 companies, including banking, real estate, hotels, agriculture and mining. He was once at the helm of Philippine Airlines Inc., Philippine Associated Smelting and Refining Corp. and BPI Agricultural Bank before focusing on his own businesses.

Philippine power struggle as Duterte battles drugs war claims Financial Times 21st Feb 2017
Philippine Senator Antonio Trillanes IV was detained for more than seven years for helping lead an uprising of fellow military officers to protest against alleged corruption under a previous president. Now the former Navy lieutenant has launched a campaign to impeach President Rodrigo Duterte over claims of graft and complicity in killings in a deadly drugs war Mr Duterte oversaw as a provincial mayor. “We are just waiting for the people to see the light,” Mr Trillanes told the Financial Times in an interview at the Senate building by the waters of Manila Bay. “Once they do, and I certainly hope they do, things will change.” The claims have intensified what Mr Duterte’s supporters brand as a conspiracy to hound the president from the office he has held for fewer than eight months. In an echo of the polarised US response to President Donald Trump’s first weeks in office, Mr Duterte’s allies say his electoral mandate must be honoured, while his opponents counter that his actions in power are autocratic and make him unfit to rule. The dispute has particular resonance in a country that has known martial law and dictatorship in living memory. This weekend marks the 31st anniversary of the fall of president Ferdinand Marcos, after the “People Power” protests against his repressive 20-year rule.

Customs

BOC eyes creation of maritime trading district in Manila Port Calls Asia 13th Feb 2017
The Bureau of Customs is making a big push for the creation of the Port of Manila Maritime Trading District (PMTD), which the agency hopes to start by 2018. The project, according to Customs commissioner Nicanor Faeldon, will generate revenues of at least P150 billion a year.

Government to create trade representative office BusinessMirror 19th Mar 2017
The Duterte administration is reviving plans to establish an agency similar to the United States Trade Representative (USTR) Office in its bid to boost the country’s export revenues. According to the Philippine Development Plan (PDP) 2017-2022, the trade representative office will focus on the country’s efforts in meeting its regional and global trade commitments. This effort will also be accompanied by measures that seek to build the capacity of Philippine trade negotiators in assessing and crafting the country’s trade positions. The plan to create a dedicated trade office comes at a time when the Philippines and its regional and other trade partners are faced with “inward-looking policies and protectionism”. These, the PDP stated, could make the conclusion of preferential or multilateral trade agreements “increasingly difficult”. Currently, the Philippines has no dedicated trade agency. The de facto representative of the country in trade negotiations is the Department of Trade and Industry (DTI). Philippine trade policy is formulated by the Committee on Tariff and Related Matters (CTRM), which is chaired by the DTI secretary and cochaired by the National Economic and Development Authority. The Philippines acceded to the World Trade Organization   in 1995 and has since steadily treaded the path of liberalization by cutting tariffs and scrapping nontariff trade barriers. The country is also a signatory to various bilateral and regional trade agreements, including the Japan-Philippines Economic Partnership Agreement and a regional agreement with China through the Asean. Despite these, the utilization rate of free trade agreements in the country by businesses is only at 22 percent.

New ro-ro route expected to boost Indonesia, Philippines trade The Jakarta Post 15th Mar 2017
The opening of the Davao-General Santos-Bitung route for roll-on/roll-off (ro-ro) vessels is expected to boost trade between Indonesia and the Philippines in the long run. The route is set to be launched on April 30 by Indonesian President Joko “Jokowi” Widodo and Philippine President Rodrigo Duterte during the 2017 ASEAN Summit in the Davao City, the Philippines. It is one of the priorities within the ASEAN RO-RO Network initiative, which is projected to improve connectivity in sea channels among Southeast Asian countries as it will reduce shipping time by over 50 percent.

Customs sets probe on P50-B smuggling PhilStar Global 12th Feb 2017
The Bureau of Customs (BOC) is set to probe deeper into reports of rampant vehicle, oil and cigarette smuggling in the country, which has resulted in more than P50 billion in lost revenues for the government. In a statement, the BOC said motor vehicle, oil and cigarette smuggling post the highest tax leakages, accounting for almost 11 percent of the agency’s 2017 collection target of P467.9 billion.

PH Customs closely investigates smuggling in top 3 imports Port Calls Asia 12th Feb 2017
Philippine Customs Commissioner Nicanor Faeldon has directed his agency’s intelligence and investigation service to look into reports of rampant smuggling of the country’s top three import products – oil, luxury vehicles and cigarettes – in many parts of the country.

Defense & Security

US extends $1-M aid for Philippine maritime security philstar.com 17th Mar 2017
The US government has agreed to extend $1 million in aid for the establishment of a maritime facility in southern Mindanao to help combat piracy and terrorism. US Ambassador Sung Kim made the commitment during a courtesy call on city Mayor Maria Isabelle Climaco-Salazar and security officials yesterday. The financial assistance will be used for the establishment of the main headquarters of the Philippine National Police (PNP) Maritime in the eastern coast of the city. The Armed Forces of the Philippines (AFP) has intensified security in the border near Tawi-Tawi to address the spate of cross-border kidnappings staged by the Abu Sayyaf. Defense Secretary Delfin Lorenzana in his visit last week to Sulu said additional naval assets and even drones will be deployed to ensure security in the vast sea lanes where the Abu Sayyaf carried out their kidnapping and high sea attacks. Lorenzana said additional marines and military helicopters were also deployed in Tawi-Tawi. It was the first visit of Kim to this city and to the southern Philippines. He also visited US troops stationed inside Western Mindanao Command (Westmincom).

Agency sought to defend, develop Benham Rise Inquirer.net 17th Mar 2017
Sen. Sherwin Gatchalian has called for the establishment of a Benham Rise Development Authority (BRDA) to allow the Philippines to systematically explore the 13-million hectare underwater plateau off Aurora province and to signal the country’s assertion of sovereign rights over it. In Senate Bill No. 312, Gatchalian said the BRDA would oversee the defense and development of Benham Rise, which a Chinese survey ship visited for extended periods last year. The Department of Foreign Affairs (DFA) on Thursday said the country had no policy allowing China to conduct research on Benham Rise, noting that any foreign vessel wishing to undertake explorations on the undersea landmass should seek permission from the Philippines.

DND mulls more patrols off Benham Rise BusinessMirror 14th Mar 2017
To demonstrate Philippine sovereignty and control over Benham Rise, Defense Secretary Delfin N. Lorenzana is eyeing the increase of patrols in the area. The maritime feature is located off the coast of Aurora and Isabela provinces. Lorenzana added that the increase of Philippine patrols in the area would demonstrate to everyone that the area is under Filipino jurisdiction. Earlier, China claimed that its ships were only exercising the right of innocent passage when the Department of National Defense announced that several Chinese survey ships were spotted in the area last year. Lorenzana disputed the Chinese claim and said ships exercising the right to innocent passage steam on a definite course and speed and do not constantly change course and speed. The 13-million-hectare Benham Rise is believed to be a mineral-rich area and awarded to the Philippines by the United Nations in 2012. Previously, Chinese survey ships were also seen off Scarborough Shoal and Reed Bank surveying the sea bed for possible mineral deposits, he added. The Chinese have gained total control of Scarborough Shoal (also known as Panatag) after a standoff with the Philippine Navy in April 2012. On Monday the Department of Foreign Affairs (DFA) said the government will protect the country’s sovereign rights to areas, like the Benham Rise, on east of Luzon. China’s Foreign Ministry Spokesman Geng Shuang had acknowledged the 2012 ruling of the UN, but said “it does not mean that the Philippines can take it as its own territory.” Geng confirmed that Chinese vessels for “marine research” passed through Benham Rise, but insisted this was only in exercise of the principle of “freedom of navigation” and “right to innocent passage”.

Abu Sayyaf kidnaps 13 in Duterte's first months Rappler 10th Mar 2017
Defense Secretary Delfin Lorenzana said there are plans to transfer an entire military division to Sulu, one of the options mulled as the government works to meet a self-imposed deadline to crush local terrorist group Abu Sayyaf. The kidnapping has gotten worse in the first months of President Rodrigo Duterte. There were 18 hostages when he assumed office on June 30. Now there are 31, mostly foreigners. There are 25 foreigners among the 31 hostages including the7 Vietnamese crewmen abducted in February. A German hostage was also beheaded last February.nResidents are asking for a more permanent military presence in Sulu, Lorenzana said. The Joint Sulu Task Force has been responsible for the island that hosts the terrorist group that has established links with Islamic State. Because it is a task force, the number soldiers deployed to serve it varies depending on instructions from headquarters. After Duterte assumed power in June 2016, the military has sent 8,000 men – more than the average number of a Philippine armed forces division – to the task force. The transfer of an entire division there, however, would provide a less ad hoc structure and tighter command and control from headquarters. A military division in the Philippines usually consists of 5,000 men. Lorenzana said a task force may also be established in Bongao in Tawi-Taiwi, the country's southermost island which has reportedly become a transit point for the terrorist group. Lorenzana said he believes the military is dealing with about 400 Abu Sayyaf armed men. The Duterte administration is also working with neighboring countries Malaysia and Indonesia to conduct joint patrols in the piracy-plagued waters.

PH, Malaysia, Indonesia to patrol piracy-prone waters ABS-CBN News 9th Mar 2017
The Philippines, Malaysia and Indonesia will launch joint patrols in piracy-plagued waters, Manila's defense secretary said Thursday, after a wave of attacks that saw Islamic militants kidnapping and murdering foreigners. The Abu Sayyaf, a kidnap-for-ransom network that has pledged allegiance to the Islamic State group, has been kidnapping sailors on fishing vessels and cargo barges including an elderly German whom it beheaded last month after ransom demands were not met. Defense Secretary Delfin Lorenzana said he and his counterparts from Malaysia and Indonesia had agreed to patrol a sea lane where commercial vessels could pass with protection from the three nations' navies. "We are inaugurating some time in April or May a joint patrol of the three nations in that area," Lorenzana said in a news conference. The waters between the three nations have become increasingly dangerous in recent years, with maritime officials warning of a "Somalia-type" situation if the attacks are not addressed. The Abu Sayyaf are holding 31 foreign and local hostages including six Vietnamese seamen attacked on their cargo ship off the southern Philippines last month, according to Lorenzana. He added President Rodrigo Duterte was "very interested" in ending the kidnapping problem. Duterte had asked China to help patrol the waters, citing Beijing's dispatch of a naval convoy to the Gulf of Aden in 2009 to protect Chinese ships from Somali pirates. Lorenzana said equipment to help fight the Abu Sayyaf like fast boats, drones and radars would be acquired as part of a military modernization program.

The Russians are coming—as investors The Manila Times 19th Feb 2017
A GROUP of Russian officials and businessmen are coming to Manila next month to look into probable economic investments in Subic Bay and Clark Field, two former huge American military bases here. This comes from my unimpeachable source who had a direct hand in convincing Pampanga local government officials to meet and talk with them. For a quick historical flashback, Clark Field in Pampanga was home of the 5th U.S. Air Force that patrolled the international air space in the South China Sea and Southeast Asia against “unfriendly war planes” since the end of the Second World War up to 1991.

Japan may offer military trucks to ASEAN- Nikkei Asian Review 19th Feb 2017
TOKYO -- Japan, trying to enhance defense cooperation with Southeast Asia, wants to offer ASEAN nations second-hand transport vehicles from its Ground Self Defense Force. Japan wants to talk with recipient countries -- such as the Philippines, Vietnam, Thailand, Malaysia and Indonesia -- as early as this summer.

South China Sea coastguards crucial: academic The Nation 13th Feb 2017
It would be a mistake to use naval power to handle the disputed areas, as that could trigger misunderstanding and further conflict, Akihiko Tanaka, a professor of international politics with the Institute for Advanced Studies on Asia at the University of Tokyo, said. “If the coastal countries have capable coastguards, they could manage the situation in a more civilised manner,” Tanaka said.  The professor gave the example of a mistake in 2012 when the Philippines, which does not have a coastguard, dispatched ships to confront the Chinese coastguard at Scarborough Shoal. The Filipino military presence ignited a tough reaction from China, he said.  Countries in Southeast Asia that are at odds with China over territorial disputes have less capable coastguards than the Chinese, Tanaka said. However, Japan could offer both financial and technical assistance to countries in the region to build up their coastguard capabilities, he said. 

Economics

ECOP accepts new contractualization rules Manila Bulletin Business 20th Mar 2017
Employers yesterday said they will try to comply with the new rules on contractualization issued by the Department of Labor and Employment (DOLE) giving the new law six months to one year to prove whether it is tenable or not. Edgar B. Lacson, Chairman of the Employers Confederation of the Philippines (ECOP), said following the issuance on Thursday a new Department Order 174 on job contractualization by DOLE Secretary Silvestre Bello III. “The new DO is more restrictive than the previous, but we employers will try to comply,” said Lacson. The new DO on contractualization is meant to end the illegal “endo” or “5-5-5’’ wherein companies terminate an employee after five months only to be rehired a few months by the same company. The DO, however, allows contractualization for seasonal projects and project-based jobs. Ending contractualization was one of the campaign promises of the then presidential candidate and now President Duterte.

House leader affirms support for tax reform package despite setback Business World 20th Mar 2017
A House of Representatives leader has affirmed congressional support for the Department of Finance’s (DoF) comprehensive tax reform package despite its setback in his own committee.

Abolish VAT to plug tax leakage–Alvarez Business Mirror 19th Mar 2017
The leader of the House of Representatives is keen on replacing the value-added tax (VAT) with the goods and services tax (GST) being implemented in a number of Asian countries to improve revenue collection. Speaker Pantaleon D. Alvarez said the GST will increase the Bureau of Internal Revenue’s (BIR) VAT collection, which currently stands at 4.3 percent of GDP. “My proposal, actually, is to remove the [current] VAT and change it with the GST that is currently being implemented in Singapore, Hong Kong and other countries,” Alvarez said in a recent radio interview. The GST in Singapore and Hong Kong is the counterpart of the country’s VAT. However, the GST is a broad-based VAT levied on import of goods, supplies of goods and services. Under the GST system all indirect taxes will be abolished and only GST would be levied. Alvarez said a GST system is needed to address tax leakages in the country. “The VAT collection rate is at 4.3 percent. That’s very low. It did not even reach half of our 12-percent target. This happens because there are leakages in our VAT system. The VAT system is not being enforced as designed because of deceitful VAT input,” he said.

Labor dep’t spells out contracting curbs Business World 17th Mar 2017
The Department of Labor and Employment (DoLE) yesterday issued an order that spelled out the rights of both employers and workers in a contractual hiring arrangement, ending nearly a year of speculation over the Duterte government’s labor policy. Labor Secretary Silvestre H. Bello III says he had to make a decision on the contentious issue of contractualization, even as positions of business and labor remained poles apart. On Thursday, in a 12-page order signed by Labor Secretary Silvestre H. Bello III and e-mailed to journalists, the DoLE imposed a complete ban on “labor-only” contracting or the so-called “endo,” a Filipino-coined term for “end-of-contract” where a worker is hired for up to five months to skirt a labor law that requires grant of permanent tenure on the sixth month of service. Department Order No. 174-Series of 2017 did not completely eradicate job contracting -- an arrangement where an employer, known as the principal, farms out jobs to a third-party contractor who then hires workers of its own. Putting an end to job contractualization was a central plank of Rodrigo R. Duterte’s campaign for presidency, so that the new directive was met by criticism anew by a labor group but was described by businessmen as a compromise that cleared uncertainties over the President’s policy. “[T]he Secretary of Labor has no power to prohibit all forms of contractualization and fixed term employment. This matter is a function of legislation,” the DoLE chief, who was former Justice secretary, added. DO 174 supersedes DO 18-A, which “was oftentimes circumvented to allow various forms of contractual arrangements and end-of-contract schemes,” a separate DoLE statement read.

‘Hot money’ flees as gov’t cracks down on mines Business World 17th Mar 2017
Short-term foreign funds fled the Philippines in February as a government crackdown on mines and perceived risks from policy shifts in the United States spooked investors, the central bank reported yesterday. Foreign portfolio investments -- also called “hot money” due to the ease by which funds enter and leave markets -- reversed to a $409.01-million outflow last month from net inflows of $301.33 million in January and $57.74 million in February 2016. Gross investments totalled $981.2 million that month, 8.2% less than the year-ago $1.069 billion. This was cancelled out by withdrawals amounting to $1.39 billion, over a third more than $1.011 billion previously. All five weeks of February saw foreign capital headed for the exit, with outflows peaking between Feb. 13-17 at $436.39 million. “[T]he following developments in the domestic and international fronts weighed on investor sentiment: concerns on trade and immigration policies under the Trump administration and the closure order for several mining companies all over the country,” the BSP said in a statement. On Feb. 2, Environment Secretary Regina Paz “Gina” L. Lopez announced that she was ordering the shutdown of 23 of the country’s 41 operating metal mines and suspending operations in five other sites. On Feb. 14, she said she was ordering holders of contracts of 75 projects in pre-operation stage to explain why they should be similarly sanctioned for being located in watersheds. Business groups have warned the government about the crackdown’s negative impact on the country’s overall investment climate. The BSP expects a $900-million net outflow in hot money this year, which if realized will reverse a $404.43-million net inflow actually logged in 2016.

BSP finally breaks five-year string of losses BusinessMirror 16th Mar 2017
At last, the Bangko Sentral ng Pilipinas (BSP) broke a five-year string of losses and in 2016 finally reported net income totaling P17.02 billion. Data released on Thursday showed the central bank finally turning in a profit last year with net income just above P17 billion, representing a turnaround from 2015 operations when it posted net operating losses aggregating P4.45 billion. The year’s net operating income was the highest on available record. This also enabled the central bank to bounce back to profitable operations for the first time since 2009. The BSP has been reporting net losses since 2010, largely because of hefty interest expense and not enough income to make up for them. This corresponded to that period when the country’s banks proved reluctant to lend on account of perceived and escalating lending risks generated in the wake of the global financial crisis. Rather than expose themselves to risks, real or imagined, the banks would rather park funds in the vaults of the central bank where, while the returns were minimal, these were “insulated from” defaulting borrowers.

Duterte steps in for tax reform Business World 16th Mar 2017
Malacañan is pulling out all the stops to smooth away legislative difficulties of its tax reform, after President Rodrigo R. Duterte bared in a press briefing last Monday with both heads of Congress that the bill has met “resistance” and “rough sailing” among lawmakers. Mr. Duterte met with 15 of the 18 senators of the majority bloc over dinner in Malacañan Palace last Tuesday -- a day after meeting with Senate President Aquilino “Koko” L. Pimentel III and Speaker Pantaleon D. Alvarez -- partly to discuss the first of four tax reform packages that has encountered hurdles in the House of Representatives Ways and Means committee and which faces even more questions in the Senate. Mr. Ejercito, who heads the Senate committees on Urban Planning, Housing and Resettlement as well as on Health and Demography, told reporters yesterday that senators aired their apprehensions with the first tax reform package. The four-package tax reform program is designed to shift overall tax burden away from low wage earners towards those who can better afford such levies, while yielding more net revenues to help finance the administration’s infrastructure drive. In its configuration as of Jan. 30, the first package was to result in P139.6 billion in foregone revenues from lower personal income tax, estate tax and donor tax rates as well as raise an additional P302.1 billion from reduced VAT exemptions, as well as increased excise taxes on cars and oil products, yielding P162.5 billion in net revenues in the first year of implementation. The entire program, in turn, is designed to backstop the Duterte administration’s plans to hike infrastructure spending to 7.1% of gross domestic product by 2022 -- the year it steps down -- from a programmed ratios of 5.4% this year and 5.1% in 2016.

Duterte’s Asian push boosts PHL investments—Dominguez BusinessMirror 16th Mar 2017
The Duterte administration’s push for greater integration with Asian economies is seen to lead to substantial investment inflows for the country this year, starting with P326 billion worth of projects, as well as rapid tourism growth and robust exports, according to the Department of Finance (DOF). During the Philippine Chamber of Commerce and Industry (PCCI) general membership meeting held at the Makati Diamond Residence on Wednesday, Finance Secretary Carlos G. Dominguez III pointed out that an estimated P326 billion worth of projects that have begun construction, or will be built starting this year, are among the investments that will lead to the “blossoming of opportunities for Filipino businessmen”. According to the finance chief, as the country shifts its source of growth from consumption to investments-led, one factor that needs to be addressed is improving the country’s low savings rate as 86 percent of Filipinos remain “unbanked”. “To be an investments-led economy, we need to improve our savings rate. The key to this is the deepening of the country’s capital markets and the broadening of access to the formal business sector,” Dominguez said. Intra-Asean trade is expected to significantly increase, and linkage between the regional bloc’s micro, small and medium enterprises (MSMEs) with Asean and global multinational enterprises (MNEs) to further strengthen. An Asean investments committee agreed to push an action agenda to facilitate cross-border trade. The Asean Coordinating Committee on Investments (CCI) met in Manila recently and agreed to make the Focused and Strategic Action (FAST) Agenda on Investment as among the its priorities for the year.

Duterte’s tax-reform plan back to the drawing board BusinessMirror 14th Mar 2017
The Duterte administration’s Comprehensive Tax Reform Package (CTRP) is facing further delays after the House Committee on Ways and Means—instead of approving the measure—opted on Tuesday to create a technical working group (TWG) to further study the proposal. The committee approved the motion of Minority Leader and Lakas Rep. Danilo E. Suarez of Quezon, as seconded by Deputy Speaker and Lakas Rep. Gloria Macapagal-Arroyo, to create a TWG to hear more the concerns of stakeholders. Deputy Speaker and Liberal Party Rep. Romero S. Quimbo of Marikina also said the TWG will consolidate the 45 pending bills seeking to lower personal income-tax rates filed at the lower chamber. House Committee on Ways and Means Chairman and Partido Demokratiko Pilipino-Laban Rep. Dakila Carlo E. Cua of Quirino said “it is worth noting that the members of his committee have already agreed to pass the CTRP as a whole and not by piecemeal. “After the TWG submits a substitute bill to the mother committee, the mother committee will take action appropriately on the proposed substitute bill.” Meanwhile, Cua said he will seek the permission of the House leadership to conduct a TWG during congressional break from March 16 to May 2. The DOF-backed tax-reform package seeks to exempt those earning P250,000 and below from personal income tax. However, the proposal also includes the imposition of excise tax on fuel as compensatory measure for the foregone revenues due to the lowering of income tax. The DOF also proposes a staggered increase of P6 per liter of diesel, kerosene and LPG to be imposed within a three-year period. The current CTRP version also imposes excise tax on vehicles. The bill also includes the relaxation of the Bank Secrecy Act, taxing Philippine Charity Sweepstakes numbers’ game and lotto winnings.

All set for the new Philippine Development Plan BusinessMirror 5th Mar 2017
On February 20 the Neda Board approved the 2017-2022 Philippine Development Plan (PDP), which is based on AmBisyon Natin 2040, the Filipino people’s collective vision and aspirations for themselves and for the country. It is also linked to President Duterte’s 10-point Socioeconomic Agenda. The PDP is the result of integrated efforts from the Neda, Cabinet secretaries and technical working groups from various agencies. It is inspired, too, by ideas and input from different stakeholders and the public, in general. Socioeconomic Planning Secretary Ernesto M. Pernia said, “By the end of 2022, Filipinos will be closer to achieving their long-term aspirations. Through this PDP, the current administration will lay a solid foundation for inclusive growth, a high-trust society, and a globally competitive knowledge economy by grounding its development thrusts on malasakit, pagbabago at patuloy na pag-unlad.” The entire plan has seven parts: Overview of the Economy, Development Challenges, Development Strategies explained in various chapters: Enhancing the Social Fabric, Inequality-Reducing Transformation, Increasing Growth Potential, Enabling and Supportive Economic Environment, and Foundations for Inclusive and Sustainable Development. As far as targets are concerned, it is largely specific, but all leading toward the general goal of making the Philippines an upper-middle class income country by 2022. Some of the specific objectives include (a) GDP growth at 7 percent to 8 percent; (b) decline of poverty rate from 21.6 percent to 14 percent; (c) decreased poverty incidence in rural areas, from 30 percent (2015) to 20 percent by 2022; (d) reduction of unemployment rate from the current 5.5 percent to 3 percent to 5 percent. Included also are difficult-to-measure targets, like higher trust in government and society, more resilient individuals and communities, and a greater drive for innovation.

Asia's Ugly Duckling of the Year Is the Philippine Peso Bloomberg.com 3rd Mar 2017
While other Asian currencies have strengthened against the dollar this year, the peso has hit a more than 10-year low and remains locked out of the party. Some analysts say that’s because investors are spooked by simmering allegations that President Rodrigo Duterte was involved in unlawful killings and corruption in his former post, which he denies. Duterte’s spokesman Ernesto Abella said in a text message Friday that the moves in the exchange rate have been driven by expectations the U.S. Federal Reserve will raise interest rates. The peso is down 1.3 percent this year, while the Korean won leads the pack of Asian currency gainers, rising 4.5 percent. It could get worse for the peso before it gets better. Technical indicators suggest its decline will continue after it breached a support level of 50 versus the dollar last month. The peso touched 50.395 on Friday, its weakest since September 2006. Overseas funds have sold net $122.1 million of Philippine equities this year, wiping out the $83.4 million inflow seen through 2016, exchange data compiled by Bloomberg show. Further pressure could build in the coming days, with the Philippine Senate due on March 6 to open an inquiry into fresh allegations by a retired policeman that Duterte headed a group that carried out extra-judicial killings when he was mayor of the southern city Davao. “There’s clearly some concern,” said Gareth Leather, a senior economist at Capital Economics Ltd. in London, referring to the political developments. The deterioration in the current account over the past year may have undermined the peso as well, he said by phone. “There’s more than just politics at play here.” Bangko Sentral ng Pilipinas Director Zeno Abenoja in December said the current-account surplus is forecast to narrow to $800 million this year from the $2.5 billion estimated for 2016 because imports are growing.

DTI, P&G tie up for MSME program BusinessMirror 21st Feb 2017
The Department of Trade and Industry (DTI) and personal- and household-care manufacturer Procter and Gamble (P&G) Philippines have partnered for a microentrepreneurship development program called “P&G Angat Kita”. In a statement on Monday, the DTI said P&G Angat Kita program aims to reach 20,000 to 30,000 microentrepreneurs nationwide to help them develop their business skills and provide start-up capital. Under the program, the DTI will give trainings and seminars to microentrepreneurs, particularly sari-sari store owners, through its Go Negosyo Centers. To date, there are 448 Go Negosyo Centers in the country. P&G will provide P2,500 worth of products as start-up capital and will provide network linkage to entrepreneurs. “This agreement is a huge lift for our microentrepreneurs, especially that we are targeting those who are at the bottom of the pyramid. We are a step closer to achieving the trabaho at negosyo [jobs and entrepreneurship] agenda of the administration,” DTI Regional Operations Group Undersecretary Zenaida Maglaya said. “This is a welcome agreement for us. After the launching of the Pondo sa Pagbabago at Pag-asenso, or P3, we hope more industry partners link up with the DTI to come up with Business Models, especially for budding microentrepreneurs,” she said. DTI and P&G initially launched the P&G Angat Kita program in Manila, Mandaluyong, Makati, Marikina, and Quezon City.

Energy

PNOC gets 27 proposals for LNG terminal project philstar.com 18th Mar 2017
MANILA, Philippines - State-run Philippine National Oil Co. (PNOC) has received a number of proposals for the development of a liquefied natural gas (LNG) terminal aimed to ensure power supply ahead of the anticipated depletion of the Malampaya gas facility by 2024, its top official said yesterday. Majority of the offers came from foreign companies interested in investing in the country’s LNG sector, PNOC president Reuben Lista said in a briefing yesterday. He said the state-run firm received three offers from firms based in Singapore, two from Korea, seven from China, six from Japan, two from Turkey, one from UAE, two from Spain and one from Australia. Meanwhile, only three offers are from Filipino companies. PNOC has set end-April as deadline to accept offers for the LNG development, Lista said. The government will also provide an emergency source of power when the Luzon grid loses supply due to plant outages. This will be done through PNOC, DOE’s corporate arm.

Energy Logics Philippines eyes additional supply to Luzon Grid Power Philippines 24th Mar 2017
ENERGY LOGICS PHILIPPINES IS EYEING TO BOOST THE SUPPLY IN THE LUZON GRID AT THE END OF THE YEAR AS THE CONSTRUCTION OF ITS 232-MEGAWATT (MW) WIND AND SOLAR PROJECT IN ILOCOS NORTE BEGINS. The construction of the Ilocos – based project will take around 18 months to finish and will start as soon as pre-development work is completed, Lu Min, chairman of the Qingdao Hengsun Zhongsheng Group Co. Ltd. “What we’re trying to strive is, although construction period is 18 months, we want to, by end of this year, have some some windmills and solar panels start contributing to the grid,” Lu said at the project launch in Davao. The project is targeted for completion at the end 2018. The project is a 132 MW wind farm in Burgos, Ilocos Norte and a 100 MW solar power plant in Pasuquin, Ilocos Norte. Construction of the wind and solar components will be built together and its Qingdao’s first project in the Philippines. Lu added that this is the biggest project in its portfolio to-date. The project as and EPC cost of $430 million – majority of the total project cost estimated at $500 million. Qingdao is the engineering, procurement, and construction (EPC) contractor for the wind and solar project.

BCPG signs deal to buy stake in Philippines wind power plant The Nation 20th Mar 2017
Thailand-based BCPG has signed a sale and purchase agreement to acquire an interest in a 50-megawatt wind power project in the Philippines as part of its Asian expansion. BCPG expects the project to be profitable immediately. The company’s president Bundit Sapianchai said BCPG signed the agreement with CAIF III Pte Ltd on Friday to acquire an interest in PetroWind Energy Inc, a “major player in the Philippines’ wind energy business”. BCPG will hold a 40 per cent interest in the project, located in Nabas, Visayas Island. Thirty-six of the megawatts are in operation and 14 are under development. The acquisition will increase BCPG’s global generating capacity to more than 400MW worldwide, which is in line with its mission to invest, develop and operate green power plants globally. The project is expected to have a plant load factor of 35-40 per cent, meaning a generation at maximum capacity of 8.4 to 9.6 hours per day. In addition to solar and wind power energy, the company has been studying various types of renewable energy including geothermal and energy storage systems, mainly in Asia Pacific – not only to expand its business portfolio but to find innovations that will help drive new businesses to create sustainability in the long run, it said.

P9.75-B solar power project breaks ground Philippine Daily Inquirer 18th Mar 2017
Solar Philippines yesterday broke ground for its 150-megawatt project in this town, which would cost at least $195 million (P9.75 billion) and was expected to be able to produce enough energy for the entire province’s needs. Concepcion Solar Farm, expected to be completed by the third quarter this year, is primed to be the country’s biggest solar power producer with 450,000 panels over 150 hectares of what used to be sugarcane farms. Leandro Leviste, Solar president and chief executive, said during the ceremonial kickoff that Concepcion Solar Farm would be the first such project to feature locally made panels and batteries for 24-hour power. “This is [also] the first in the Philippines to [be built] at lower cost than coal and first to demonstrate that renewable energy as baseload (power-generating resource) is already here and not something that will take 10 or 20 more years,” Leviste said. He said the solar farm would offer electricity at about P1 per kilowatt-hour or 10 percent lower than the cost of power generated based on coal. The Concepcion facility will use panels made in the company’s factory in Batangas, which started production this month and where 1,000 jobs are expected to be created. The Concepcion project will initially operate as a merchant supplier, and Solar is engaged in ongoing discussions with distribution utilities and local electric cooperatives for supply off-take contracts. Also this year, Solar plans to start construction of a number of other projects, including 50 MW of new capacity in Batangas and Cavite.

Mining issues cloud Phl competitiveness philstar.com 17th Mar 2017
The Philippines may soon feel the backlash of the ongoing issues surrounding the closure and suspension of mining companies in its global competitiveness rankings, the National Competitiveness Council (NCC) said. NCC private sector co-chairman Guillermo Luz told The STAR the decision of the Department of Environment and Natural Resources (DENR) to close 23 mine sites and suspend five others may affect the country’s standing in some global reports, particularly those that include rule of law, contracts and formation of public policy as indicators.

LNG project offers flood PNOC Business World 17th Mar 2017
State-owned Philippine National Oil Co. (PNOC) has received unsolicited proposals from 26 groups -- three Filipinos and 23 foreigners -- for its plan to put up a liquefied natural gas (LNG) facility in the country that can house a power plant as well as stations for storage, liquefaction and regasification, its president said. “[The facility will be] operational by 2019... ‘yan ang aming [that’s our] optimistic dream,” Reuben S. Lista, PNOC president and chief executive officer, told reporters in a briefing at the company’s main office in Taguig City. “Our pessimistic dream is 2020,” he said, keeping the project’s completion date within the present administration. He gave a breakdown of the proposals as three from Singapore, two from Korea, seven from China, six from Japan, two from Turkey, and one each from the United Arab Emirates, Spain and Australia. Mr. Cusi, who chairs PNOC, has been saying that one of his plans was to build an LNG facility for the country to ensure energy security and to bring down power rates. He said the project would be led by PNOC, the Department of Energy’s (DoE) attached commercial entity. He placed the submission of final proposals by end-April, adding he expects offers be reduced to “maybe seven,” after which the PNOC working group will draw up a short list. Mr. Lista said the integrated LNG facility project could be expanded to include natural gas distribution to power plants or gas stations to benefit vehicles that run on compressed natural gas. The project was floated partly in preparation for the depletion of Malampaya reserves which is expected in 2024, at the earliest, although the consortium that operates the gas platform sought its license to be extended to 2028-2029.

Villar urges dev’t of downstream mining industry philstar.com 14th Mar 2017
Despite the continued crackdown on the mining sector, the country should still develop new domestic mineral processing plants, Sen. Cynthia Villar said. “Mining is an industry that we have to develop provided that they follow responsible mining,” Villar told reporters. Shifting from export to processing is the government’s long-term goal to boost employment and significantly improve the mining industry’s contribution to the economy. The Philippines is currently just exporting raw materials as the industry has yet to be developed. However, Environment Secretary Gina Lopez’s move to close down 23 operations, suspend five others and cancel 75 contracts is scaring industry stakeholders. “It’s very controversial but I don’t think they will stop mining. We just have to follow the law with regard to these industries,” Villar said. The downstream plan is similar to that of the Indonesian government’s, which requires companies to build domestic processing facilities. For its part, the Chamber of Mines of the Philippines (COMP) expressed confidence the results of the review being conducted by the Mining Industry Coordinating Council (MICC) would counter the audit findings of the Department of Environment and Natural Resources.

DoE wants fast track for P3.5-B power projects Business World 13th Mar 2017
The Department of Energy (DoE) is proposing a threshold of P3.5 billion for power generation ventures to be declared as projects of national significance, a status which frees them from tedious permitting and regulatory hurdles. However, the project cost will only be secondary to the department’s goals as laid down in the Philippine Energy Plan (PEP), the long-term industry blueprint annually updated by the DoE as called for under Republic Act 9136 or the Electric Power Industry Reform Act of 2001 (EPIRA). “It’s the PEP and any of the following,” said Energy Undersecretary Felix William B. Fuentebella in a recent interview, as he emphasized the plan’s precedence over the list of qualifications for a project to be declared of national significance. These qualifications are part of a proposed executive order drafted by the Energy department. Mr. Fuentebella said the order has been forwarded to the Office of the President and submitted to the Cabinet. “The PEP is the summary of all the plans that we have,” he said, adding the sub-plans covering power plant development, transmission, distribution, household and missionary electrification as well as plans in securing petroleum products, energy resource development and utilization. The DoE previously announced the other qualifications to include the projects’ contribution to the country’s economic development, consequential economic impacts and positive impact on the environment, which the DoE said should be “significant.” The others are the projects’ potential contribution to the country’s balance of payments, their complex technical processes and engineering designs, and significant infrastructure requirements.

Philippines' Duterte wants mining ban, links miners to destabilization plot Reuters 13th Mar 2017
Philippine President Rodrigo Duterte on Monday accused some miners of funding efforts to destabilize his government as he talked about a possible plan to impose a ban on mining given the environmental damage producers have caused. Duterte, who has said the Southeast Asian nation can survive without mining, has backed a crackdown on miners by Environment and Natural Resources Secretary Regina Lopez in the world's top supplier of nickel ore. Duterte said he was looking at a total mining ban "and then we'll talk", referring to miners. "I know that some of you are giving funding to the other side to destabilize me," he said, referring to companies in the mining sector he did not name. He did not say how his government was being destabilized, only that there could be efforts to make him "unpopular". The Chamber of Mines of the Philippines, which groups many large-scale miners, said in a statement it was "unaware of any mining company that is supportive of any destabilization efforts against the administration". Duterte has supported Lopez's Feb. 2 order to shut 23 of the country's 41 mines to protect watersheds. She suspended another five for environmental infringements and also canceled 75 contracts for undeveloped mines. The mining sector contributes an estimated 70 billion Philippine pesos ($1.39 billion) a year in revenue. Miners have complained about Lopez's mine closure orders, saying they were baseless, did not follow due process and would affect 1.2 million people who depend on mining for their livelihood. Lopez defended her decisions in Congress last week where lawmakers held a two-day hearing on her appointment. She said her orders were above board and were made to protect functions of watersheds. Lawmakers will meet on Tuesday before they vote on whether to confirm or reject her appointment in June last year when Duterte took office. In the Philippines, confirmation hearings can take place long after ministers start work.

CA: Gina acting ‘above the law’ Manila Standard 10th Mar 2017
Members of the Commission on Appointments on Thursday rebuffed Environment Secretary Lopez for acting as if she were above the law by imposing new standards and changing the rules midstream when she closed 23 mine sites and canceled 75 mineral production sharing agreements. Those who opposed Lopez’s confirmation also complained that Lopez not only changed the rules, but also her mind when she opposed a review of her closure orders shortly after signing the order to push through with it.mThose who opposed her confirmation also said Lopez showed her bias against mining and failed to transcend her advocacy. The lawmakers also rebuked Lopez for claiming that provinces that were hosts to mining companies were among the poorest of the poor. To justify her actions, lawmakers said, Lopez threw out existing standards and imposed her own, based on “social and economic justice.” “That’s where the conflict starts. The mining companies complied with the highest standards but you changed the rules midstream that became subjective and arbitrary. You changed the policy midstream. They were really surprised because they were ISO 14001 compliant but you changed the standards.”

PH, Japan to prioritize RE projects in Mindanao The Manila Times 9th Mar 2017
The Mindanao Development Authority (MinDA) and Japan’s Ministry of Economy, Trade and Industry (METI) have identified priority areas of collaboration in renewable energy in the southern Philippines. Among these projects are the rehabilitation of the Agus-Pulangi Hydropower Complexes, improvement of the disaster resiliency of power distribution networks, the promotion of geothermal and wind power, enhancement of electricity distribution in areas with low electrification rates, such as in the Basilan-Sulu-Tawi-Tawi (BASULTA) area. Japan is prepared to offer two-step loans for such projects while feasibility studies will be offered as grants. A two-step loan is one where funds pass through a commercial bank or other financial institution before being released to the end-beneficiaries. Technical experts will also be made available through the Japan International Cooperation Agency (JICA). The rapid growth of the manufacturing, real estate, services, and agri-business sectors however, resulted to a surge in demand for electricity. Projected demand for 2016 was at least 500 MW. By 2020, there would be a need for another 500MW, and by 2030 an additional 1,600MW. The entry of more fossil-fuel based power plants, particularly coal, is projected to raise the cost of electricity in the island-region. Power generated From this source now accounts for 69 percent in Mindanao, with coal accounting for 40 percent. Shares of hydro, geothermal, solar and biomass accounted for just 31 percent of the total power generated. To promote the use of renewable energy and lower electricity rates, METI proposed the introduction of wind power plants in viable areas in North-Eastern Mindanao, particularly in the province of Surigao including the islands of Dinagat and Siargao. The METI is also proposing for the use of small-sized geothermal power plants in the range of 2-7MW as these can be built faster and at lower cost.

Philippine minister asks Duterte to halt second mine review she earlier supported Reuters 7th Mar 2017
The Philippine environment minister has asked President Rodrigo Duterte to halt a second review of 28 mines that she ordered closed or suspended, challenging its legality despite initially supporting it. The U-turn by Environment and Natural Resources Secretary Regina Lopez comes as she faces pressure to defend her decision to shut more than half the country's mines, a move that prompted an industry outcry and concerns about lost revenue. The government's Mining Industry Coordinating Council (MICC), an inter-agency panel that includes the finance ministry, is conducting a review of the mines following criticism from miners that the original decision was baseless and lacked due process. "The MICC is not mandated to do a review of any mining operation. The only agency that can do a review of mining operations is DENR, and that's what we've done," Lopez told Reuters, referring to her environment agency. Duterte's spokesman, Ernesto Abella, declined to comment on Lopez's latest move, saying it was not discussed in a cabinet meeting. Duterte, who last year warned miners to abide by stricter environmental rules or close down, has so far backed Lopez, a committed environmentalist, in the increasingly contentious dispute. Lopez on Feb. 2 ordered the closure of 23 of 41 mines in the world's top nickel ore supplier and suspended five others to protect watersheds after a months-long review last year by the environment agency. Members of the MICC met a week later and agreed to a second review of the affected mines, issuing a joint resolution signed by Lopez and Finance Secretary Carlos Dominguez who co-chair the mining council.

Philippines to get P75-B power plant investment from Japan Power Philippines 6th Mar 2017
JAPAN’S SEVEN MAJOR TRADING HOUSES IS LOOKING TO INVEST P198.5 BILLION INVESTMENT INTERESTS IN THE COUNTRY, INCLUDING A P75-BILLION COAL-FIRED POWER PLANT, THE DEPARTMENT OF TRADE AND INDUSTRY (DTI) SAID. The Sogo Shosha group, comprised of senior executives from Toyota Tsusho, Mitsubishi Motors, Mitsui & Co. Ltd, Sojitz Corp., Sumitomo Group, Marubeni Corp., and Itochu Corp., expressed interest in the following industries: energy, railway and transportation, water management, and security. The trading houses met with trading secretary Ramon Lopez, and have already committed P20 billion. Other projects include capacity enhancements of Light Rail Transit (LRT) line 1 South extension, LRT-2 East extensions, and North-South Commuter Railway project, developments of the Davao, Cebu, and Clark transit systems, and the Philippine Coast Guard Multi Role response vessels. “We urge Japanese investors to take the chance to invest in the Philippines as it experiences its momentous economic takeoff in the region,” Lopez said. Lopez also secured a biomass fuel project in Mindanao and a 120-hectare ship reuse center in Negros Occidental with Tsuneushi Shipbuilding Co. Ltd. Investments will come until 2018 and is expected to generate P15.2 billion and 32,000 additional jobs in shipbuilding and the biofuel industry. Lopez was in Japan for an investment forum and the 35th Japan – Philippines Economic Cooperation Committee and Philippines – Japan Economic Cooperation Committee meetings.

Philippines may consider ban on exports of unprocessed minerals The Business Times 3rd Mar 2017
The Philippines may consider banning exports of unprocessed minerals in an effort to promote value addition in the mining sector, a senior environment official said on Friday. "It is one of the options that has to be considered not only by the DENR (Department of Environment and Natural Resources) but by the entire government," DENR Undersecretary Maria Paz Luna told reporters. Ms Luna spoke after a meeting with other government officials tasked to conduct a second review of 28 mines ordered closed or suspended by the environment ministry.

Philippines looking at ban on ore exports in reform push, nickel jumps Reuters 3rd Mar 2017
The Philippines may consider banning exports of raw minerals to encourage domestic processing and boost the value of shipments, an environment official said on Friday, as the government looks to extract more from its mining sector after a crackdown. Nickel prices rose more than 1 percent on the potential for supply disruption from the world's top nickel ore exporter, but miners said following in the foosteps of neighbouring Indonesia wouldn't be viable without big governnment incentives. Previous governments in the Philippines have supported calls to spur domestic processing of raw minerals but earlier efforts in Congress to enact appropriate laws have failed to take off. "It's one of the things we're considering for any mine that we think should remain operating," Environment and Natural Resources Undersecretary Maria Paz Luna told reporters. Mining has come into sharp focus in the Philippines in recent months after the country's firebrand environment minister, Regina Lopez, ordered the closure of more than half of the country's mines to protect watersheds, prompting an industry backlash. Her decision is now being reviewed by the government's Mining Industry Coordinating Council amid concerns over its financial impact and criticism that due process was not followed. The Philippines took over as the world's top nickel ore exporter after Indonesia banned exports of unprocessed ore in 2014, aiming to spur development of higher value smelting industries. However, Indonesia relaxed its mining export rules in January, allowing exports of raw ore under certain conditions, after facing a hefty budget deficit and missing its 2016 revenue target by $17.6 billion. "It means that (Indonesia's) experiment has failed," Ronald Recidoro, lawyer from the Chamber of Mines of the Philippines, told Reuters.

Duterte signs Paris deal philstar.com 1st Mar 2017
Despite his objections to some of its provisions, President Rodrigo Duterte has signed the historic Paris climate deal calling for the reduction of carbon emissions that have been linked to natural disasters. Malacañang submitted the agreement to the Senate for ratification last February 28, documents furnished to the media showed on Wednesday. "After examining the text thereof, I find it advisable to accede to the Paris Agreement and seek the Senate's concurrence thereto," the president said in a letter to the Senate. The climate agreement has to be ratified by the Senate before it becomes binding. Climate change, which has been linked to natural disasters and extreme weather conditions, has been blamed on carbon emissions caused by human activities. In 2015, members of the United Nations Framework Convention on Climate Change including the Philippines crafted the Paris agreement, which aims to limit the increase in the global average temperature to “well below” two degrees Celsius above pre-industrial levels. Leaders of the member countries have also vowed step up measures to limit temperature rise to 1.5 degrees Celsius above pre-industrial levels. Developed countries are required to provide financial support to developing countries’ mitigation and adaptation efforts. The deal also requires signatories to set carbon emission targets but is silent on what would happen to parties who would fail to meet them. While not a major emitter, the Philippines promised to reduce carbon emissions by 70 percent by 2030.

BoI approves P1.2-b biomass power plant Manila Standard 28th Feb 2017
The Board of Investments approved the request of Satrap Power Corp. for fiscal incentives as a renewable energy developer for its P1.16-billion biomass energy project under the current Investment Priorities Plan. The power project involves the development, construction and operation of a combined 10-megawatt power facility in Barangay Nagpanaoan, Santa, Ilocos Sur. “This project boosts the Ilocos region as a hub for renewable power and complements the wind power plants already in the region,” Trade Undersecretary and BoI managing head Ceferino Rodolfo said. “The addition of biomass projects will spur further development of renewable energy sources in the area as we continue our march towards reducing our dependence on fossil fuels over time,” he said. Satrap will use municipal solid wastes and agricultural wastes as feedstock to generate 3 megawatts and 7 MW of power, respectively, through a supply agreement with several local government units in the province. Both plants are scheduled to be operational in April 2019 with an estimated 30 employees. Satrap has the option to sell the generated electricity to National Grid Corp. of the Philippines under the feed-in tariff system of the Renewable Energy Act. Ilocos Sur Electric Cooperative Inc. is also being considered as another market. Industry data as of June 2016 showed the Philippines had a total installed power capacity of 20,055 MW with a dependable production of 17,925 MW and an available output 13,877 MW. Peak demand reached 13,197 MW. Newly-installed operational capacity stood at 1,271 MW, while committed projects expected to be operational by the end of 2016 topped 6,179 MW with an indicative capacities of up to 13,853 MW. Renewable energy constituted the largest share of the total installed power capacity in the country with a 34.3-percent share, followed by coal with 33.2 percent and natural gas at 14.3 percent.

BIMP-EAGA tackles Sabah-Palawan energy connectivity The Manila Times 27th Feb 2017
The possible energy interconnection of Sabah to Palawan has gained the support of the sub-regional organization business group from Brunei Darussalam-Indonesia-Malaysia-Philippines East Asean Growth Area (BIMP-EAGA) Power. The BIMP-EAGA Business Council (BEBC) presented to the Philippine delegates the proposed Sabah to Palawan Interconnection project. The BEBC, a private sector group, initiated the partnership with the Provincial Government of Palawan aiming to deliver electric power from Sabah to Palawan. The Department of Energy (DoE) expressed full support for BIMP-EAGA Power and Energy Cluster whose thrusts run parallel to the country’s own agenda of ensuring energy security, promoting a low carbon future, achieving total electrification, and improving energy efficiency and conservation. The key output of the cluster meeting is the formulation of the nine-year (2017-2025) Power and Energy Infrastructure Cluster (PEIC) Roadmap for the different sub-sectors such as: Power Interconnection, Renewable Energy (RE), Rural Electrification and Sub-Regional Energy Efficiency and Conservation (EE&C) rolling pipeline project as input to the final BIMP-EAGA Vision 2017-2025 (BEV2025).

Cusi wants to convert Malaya Thermal Power Plant into LNG plant philstar.com 27th Feb 2017
Energy Secretary Alfonso Cusi wants to convert the 650-megawatt (MW) Malaya Thermal Power Plant (TPP) in Rizal into a liquefied natural gas (LNG) facility as part of plans to ensure the country with reliable power supply in the future. “Part of the condition is to convert it into LNG plant…so we won’t lose capacity of around 600 MW,” he said. The plant’s conversion would allow the country to have a cleaner, more efficient and more reliable power plant, the Energy chief said. “From diesel, which is an inefficient and expensive power source… what we want is the country will still have 600 MW when we convert it into cleaner power and which we can use as a baseload power. As it is, the plant runs on diesel oil, which is only for peaking,” Cusi said. However, converting the diesel power plant into an LNG plant should still be studied since the bidding process for the power facility has already started, he said. Currently, the Malaya TPP is among the state-owned power plants scheduled to be privatized by the Power Sector Assets and Liabilities Management Corp. (PSALM) this year. PSALM, the entity created by the Electric Power Industry Reform Act (EPIRA) to privatize government-owned power assets, has set the auction on March 8. The asset will be sold on an “as is, where is” basis. Meanwhile, the Energy chief is also looking at rehabilitating the 982-megawatt Agus-Pulangi hydroelectric power plants (HEPP) in Mindanao before selling the facilities, especially with an oversupply scenario looming in the region by 2018. Earlier, Finance Secretary Carlos Dominguez, who chairs PSALM, said rehabilitating the Agus-Pulangi HEPP is the top priority before undertaking any privatization process for the facility.

Solar firm to debut battery storage philstar.com 21st Feb 2017
Solar Philippines will showcase the country’s first solar farm equipped with batteries when it completes the first 50 megawatts (MW) of its largest solar project in Tarlac by mid-2017, its top official said yesterday. The company expects batteries to become a game changer in the solar market this year. “Tarlac Phase 1 of 50 MW will be completed by mid-2017 and the total 150 MW are targeted by end of the year,”  Solar Philippines president Leandro Leviste said in a text message yesterday. He said solar-plus-storage projects are already cheaper than expensive diesel and natural gas. Solar Philippines announced yesterday it would integrate batteries into nearly all its upcoming solar farms, to supply reliable 24/7 power starting this year. It is in discussions with battery suppliers including US-based automotive and energy storage firm Tesla, which is doubling the world’s battery manufacturing capacity to accelerate cost decreases, and will soon complete the world’s largest solar-plus-storage project to supply evening power in Hawaii. Red tape remains a barrier to solar-plus-storage, the company said. The Confederation of Solar Developers of the Philippines (CSDP) noted that around 600 signatures are required for permits to develop a solar project resulting in a multi-year process. According to CSDP, this has discouraged investments in renewable energy.  Another barrier is the price of solar panels, which remains the largest cost item. Solar Philippines, however, said it would soon open the first locally-owned solar panel factory, in line with its goal to construct and develop solar farms in-house, to lower costs and bring greater competition into renewable energy.

National Transmission Corp. wants bigger role in energy planning Business World 20th Feb 2017
State-run National Transmission Corp. (TransCo) wants to have an active role in writing the country’s transmission development plan in a move that is expected to expand its role in preparing the broader and long-term Philippine Energy Plan, its president said. Melvin A. Matibag, TransCo president and chief executive officer, said he would be asking Energy Secretary Alfonso G. Cusi for a department order that would include his office in the planning stage of the transmission plan. “I will be asking the secretary if he can issue a department order so that we will be included,” he said in a recent interview. “We want to be included in the planning stage, in the preparation,” he said, adding that in the past this was a role handled largely by privately owned National Grid Corporation of the Philippines (NGCP), which holds the congressional franchise to operate and maintain the country’s power grid. The transmission plan has become crucial in view of a government directive to hasten the interconnection of the Mindanao electricity to the Luzon and Visayas grids. NGCP earlier this month said it was targeting the link to happen by end-2020 and possibly cost around P52 billion. He said the department order he was seeking should give TransCo the power to recommend the plan before this is submitted for approval to the Department of Energy (DoE), which in turn endorses the document to the Energy Regulatory Commission (ERC) and the Grid Management Committee, Inc. (GMC).

Energy Department, PEZA ink deal on ecozones investment Power Philippines 20th Feb 2017
THE DEPARTMENT OF ENERGY (DOE) AND THE PHILIPPINE ECONOMIC ZONE AUTHORITY (PEZA) HAVE SIGNED A DEAL TO ACCELERATE THE DEVELOPMENT OF REGIONAL ECONOMIC ZONES (ECOZONES) IN THE COUNTRY. “The MOU (Memorandum of Understanding) is an initiative consistent with the long-term economic vision of President Rodrigo Duterte known as ‘Ambisyon 2040’ and complements his 10-point socio-economic agenda,” DOE Secretary Alfonso Cusi said. “With the MOU in place, the country can expect the flow of critical investment which in the long-run creates more job opportunities and spurs rural development,” he added. DOE will develop energy policies under the deal that will “facilitate the reduction of the cost of doing business in the country, including the ecozones.” The DOE chief added that energy efficiency programs – like the Energy Management Systems – will be given importance in helping the locator companies to become more efficient in using energy resources. “This will result in lower power costs to sustain the companies’ competitiveness, while also encouraging the establishment of more energy efficient ecozones in the country,” Cusi said. He also emphasized the importance of policies that would streamline the permitting processes for energy projects, to ensure stable and reliable supply of energy to drive the economic activities in the ecozones. According to the 2016 data of the International Energy Consultants (IEC), the Philippine electricity rate – specifically the Manila Electric Co. (Meralco) – is the third highest in Asia, fourth in Asia Pacific and 16th worldwide.

Speaker Alvarez files bill scrapping ERC, proposes formation of Board of Energy Power Philippines 17th Feb 2017
SPEAKER PANTALEON ALVAREZ HAS FILED A HOUSE BILL THAT WILL ABOLISH THE ENERGY REGULATORY COMMISSION (ERC) FOLLOWING CORRUPTION ALLEGATIONS AND THE SUICIDE OF A DIRECTOR OVER ALLEGED COERCION TO APPROVE IRREGULAR CONTRACTS. “The suspicions raised against the integrity of the ERC, which is primarily entrusted with regulating the country’s electric industry and promoting competition in the market, cannot be ignored,” Alvarez said in House Bill no. 5020. Alvarez cited the suicide letters left by ERC Director Francisco Jose Villa Jr., which contain allegations on dubious deals and practices within the agency. Under the bill, the ERC will be replaced with the Board of Energy, which will be an attached agency of the Department of Energy. This means the DOE will control and supervise the board. “This will ensure that the newly created board shall be explicitly within the regulatory arm of the government and specifically, within the direct control and supervision of the President,” Alvarez said. The Board of Energy will be tasked to perform ERC’s roles. It will be composed of a chairperson and two members appointed by the President based on the recommendation of the Energy Secretary. To ensure no conflict of interest, the bill prohibits the chairperson and members of the board or any of their relatives within the fourth civil degree, consanguinity or affinity, legitimate or common law, from holding any interest whatsoever in any company or entity engaged in the energy business.

Financial Services

Philippines starts opening bank sector to Asean peers philstar.com 22nd Mar 2017
The Philippines is set to sign agreements with two more countries as early as next month to open up the banking industry aimed at greater financial integration and economic development among members of the Association of Southeast Asian Nations (ASEAN). Bangko Sentral ng Pilipinas Governor Amando Tetangco Jr. said in a speech during the 29th National Convention of the Bankers Institute of the Philippines (BaiPhil) the Philippines would forge an agreement with two more ASEAN countries after signing a pact with the Bank Negara Malaysia last March. Tetangco and Bank Negara governor Zeti Akhtar Aziz signed the Heads of Agreement (HoA) in Kuala Lumpur last March 14. The pact between the BSP and Bank Negara was one of the first bilateral agreements to be signed under the ASEAN Banking Integration Framework (ABIF).

House OKs bill regulating online payments philstar.com 19th Mar 2017
The House of Representatives has approved on second reading a bill regulating online payments that are believed to amount to billions of pesos a day. Eastern Samar Rep. Ben Evardone, chairman of the committee on banks and financial intermediaries and sponsor of House Bill 5000, said there is no agency authorized to supervise and regulate online payments.  “Congress has to step in, since this is becoming a big sector of the economy. Billions of pesos are transacted everyday, and yet, there is no agency to turn to in case of abuses and malpractices,” he said. Evardone cited as an example money remittance companies. He said banking laws do not empower the Bangko Sentral ng Pilipinas (BSP) to regulate these businesses. He said if the remittance company delays sending the money to its beneficiary or cheats him, the aggrieved party has no specific agency to go to and no law to invoke.

Antimoney laundering rules tightened Philippine Daily Inquirer 18th Mar 2017
The Bangko Sentral ng Pilipinas has further tightened its antimoney laundering rules while still providing flexibility for the unbanked who wanted to open bank accounts. In a statement, the BSP yesterday said the Monetary Board, its highest policymaking body, had approved amendments to regulations governing antimoney laundering and antiterrorist financing efforts. According to the BSP, the Monetary Board-approved amendments include “refinements in the conduct of customer due diligence, more pragmatic definition of ‘official document’ and the use of other reliable, independent source documents, data or information for customer identification and verification.” “The new rules likewise introduced the concept of a ‘restricted account’ to cater to targeted unbanked sector, wherein minimal customer information are required subject to certain conditions, such as constraints in terms of activity. These will provide much greater flexibility in on-boarding unbanked customers, especially in rural areas where official IDs are not prevalent,” the BSP added. Given strides in technology even in the financial and banking system, the amended rules “recognize and allow the use of information and communication technology in the conduct of customer identification subject to implementation of appropriate measures to manage attendant risks,” the BSP said.

House bill on BSP regulation, supervision of payment systems hurdles 2nd reading Business Mirror 16th Mar 2017
The House of Representatives has approved on second reading a measure providing for the regulation and supervision of the payment systems in the Philippines. House Committee on Banks and Financial Intermediaries and PDP-Laban Rep. Ben Evardone of Eastern Samar, one of the authors of the measure, said the House Bill 5000 will provide payment systems, which is a vital part of the economic and financial infrastructure of the country. To ensure proper implementation of this mandate, the bill also requires the BSP to coordinate with other regulators and other concerned agencies to avoid gaps, inefficiencies, duplication and inconsistencies in the regulation of other systems that are related to or interconnected with payment systems; and shall endeavor to coordinate with regulators or overseers of payment systems of other countries to facilitate safe, efficient and reliable cross-border payment transactions.

Landbank pushes rural bank consolidation The Asian Banker 27th Feb 2017
The state-owned Land Bank of the Philippines (Landbank) has proposed to consolidate a critical mass of the country’s small rural banks into one big entity that can rival universal banks in terms of capitalization. Landbank is willing to contribute fresh capital to own 51 percent of the proposed “Apex Rural Bank,” which will have an authorized capital of P5 billion and become the vehicle for consolidation, Landbank president Alex Buenaventura said in an interview with the Inquirer.

Corporate governance reforms in the Philippines Lexology 13th Feb 2017
Senate Bill 2945 foreshadows increased disclosure and transparency, increased director disqualifications, the introduction of the concept of independent directors, allowing attendance at meetings by remote communication and allowing voting in absentia. Curbs on corporate abuse and corruption are also being introduced, along with whistle-blower provisions and a requirement for a code of ethics/standards of conduct in the by-laws of corporations.

Food & Agriculture

Coca-Cola Philippines to buy more local sugar: Piñol Manila Bulletin Business 24th Mar 2017
By Ali G. Macabalang Coca-Cola Femsa Philippines (CCFP) will buy more sugar from Filipino planters who became restive lately over issues of product patronage and marketing, Agriculture Secretary Manny Piñol announced on Friday, March 24. Piñol said lawyers Adel Tamano and Juan Lorenzon Tañada, CCFP vice president for corporate affairs and corporate director, respectively, visited his office Thursday, March 23 to personally convey their company’s win-win option. He said the company’s pledge to buy more local sugar came with a request for a six-month period to be able to install a new “clarification equipment” that could process raw sugar into syrup.

Sugar regulator proposes import duty on corn-based sweetener Business World 22nd Mar 2017
The Sugar Regulatory Administration (SRA) is set to propose to the National Economic and Development Authority (NEDA) this week the imposition of an import duty for high fructose corn syrup (HFCS), the sweetener that has dampened industrial demand for refined sugar. SRA Administrator Anna Rosario V. Paner said that the duty was requested by the sugar industry and that the agency is elevating these concerns to the NEDA. “Industry asked whether the tariff of HFCS can be likened to those for sugar, or higher, but not kept at zero, which leads to their unbridled importation. Under that scenario we might as well close the refineries,” Ms. Paner said in a phone interview on Tuesday. Under the ASEAN Trade in Goods Agreement (ATIGA), sugar is levied an import duty of 5%. Asked whether the move may result in disputes with other World Trade Organization members, Ms. Paner said: “There are exceptions to the rule if foreign products are imported to the detriment of local products. It does not curtail trade but it doesn’t mean you cannot regulate.” Last year, an estimated 373,000 tons of HFCS entered the Philippine market, up 58.72% year on year. HFCS importation has driven down sugar prices from a high of more than P1,800/bag to less than P1,448.68 per bag as of Feb. 12, translating to potential revenue losses of about P20 billion for the current crop year. Last month the SRA issued Sugar Order No. 3 to authorize the regulation of the HFCS imports. However, Agriculture Secretary Emmanuel F. Piñol suspended the implementation of the order, citing the failure to consult stakeholders more widely.

PCA chief suspended over corruption allegations philstar.com 21st Mar 2017
Philippine Coconut Authority (PCA) administrator Avelino Andal is being investigated by the Office of the Cabinet Secretary that recently placed him under preventive suspension following allegations of corruption. Cabinet Secretary Leoncio Evasco Jr. issued the board resolution to suspend Andal “to conduct an unhampered investigation upon deliberation of recent events involving the administrator.” “There’s an alleged illegal collection of P1.50 per board foot of lumber in Basilan by Andal’s trusted employees. We also received sworn statements stating that he is the mastermind of such scheme,” said Cabinet undersecretary Halmen Valdez in a text message. Although the amount sounds small, she pointed out that it would actually amount to P90 million when 400,000 trees would be cut as part of the debris management process of the post cocolisap treatment in Basilan alone. The same scheme is reportedly done in Mindoro, Marinduque and Quezon provinces. Andal denied the charge and vowed to continue his work as administrator. He slammed Valdez, saying she is instituting a grand plan similar to what happened to National Irrigation Administration chief Peter Laviña and National Food Authority head Jason Aquino, who is currently being investigated. He believes that the plot against him is in relation to the nearing release of the P75-billion coconut levy fund. The coconut levy fund amounting to P75 billion is now with Congress and its release is being fast-tracked for the benefit of the industry. It was taken from the taxes imposed on coconut farmers through Presidential Decree 755 issued by dictator Ferdinand Marcos in 1975.

SRA defends order regulating entry of imported fructose BusinessMirror 20th Mar 2017
The Sugar Regulatory Administration (SRA) on Monday said it was not required to consult soft-drink makers before issuing an order that effectively limited the entry of imported high-fructose corn syrup (HFCS) into the country. Agriculture Secretary Emmanuel F. Piñol wanted to suspend the implementation of Sugar Order (SO) 3, which imposed additional requirements on importers of HFCS, saying soft-drink makers were not consulted prior to its issuance. “The SRA’s point was in the exercise of our quasilegislative powers, the agency is not required to have prior consultations before coming up with our rules and regulations,” SRA Administrator Anna Rosario V. Paner told the BusinessMirror. “Even assuming that we are required to do so, we consulted the concerned stakeholders of the SRA, specifically those who have sectoral representatives in the SRA board. Our sectoral representatives include the planters and the millers,” she added. Paner said they also held consultations with labor groups and food companies. “There were consultations conducted. Maybe the difference is the extent of the consultations in terms of the appreciation of the secretary.” The SRA is a government-owned and -controlled corporation attached to the Department of Agriculture (DA). Its administrator is appointed by the President, while the DA chief serves as ex officio chairman of the SRA Board. In February the SRA issued SO 3, after farmers and millers complained they were losing some P10 billion a year due to the unregulated entry of HFCS imports being used by local beverage and food producers. Piñol said he would convene the SRA Board on March 23 to discuss HFCS importation and the possible suspension of SO 3.

Sugar authority’s bid to regulate corn syrup imports hits snag Business World 16th Mar 2017
The Department of Agriculture (DA) will put on hold the implementation of the Sugar Regulatory Administration’s new policy of regulating the entry of high-fructose corn syrup (HFCS), citing the lack of consultations held on the creation of the sugar order and the possible disruption of the soft drink supply. Agriculture Secretary Emmanuel F. Piñol said that the drafting of Sugar Order No. 3 failed to consult stakeholders as claimed by Coca-Cola FEMSA Philippines, Inc.,, which appealed the order with the DA. “They say they were not properly consulted. Any change in the type of sugar that use in production of their soft drinks will involve changing their machinery and equipment because their equipment is designed for HFCS,” Mr. Piñol told reporters. The sugar cane industry prodded the SRA to intervene in the import of HFCS, leading to the drafting of Sugar Order No. 3 issued on Feb. 20 which gave the agency the authority to regulate HFCS in the interest of protecting cane farmers. Data from the agency shows that beverage makers and food processors shipped some 800,000 metric tons of HFCS into the country in 2016, displacing demand for about 20 million 50-kilo bags of locally produced refined sugar. Earlier, SRA Administrator Anna Rosario V. Paner said that volume translates to a 33% lost market share for cane sugar. She added that HFCS importation has driven down sugar prices from a high of more than P1,800/bag to less than P1,448.68 per bag as of Feb. 12, translating to potential revenue losses of about P20 billion for the current crop year.

Senate eyes probe vs ex-B.I.R. chief linked to fake stamps Business Mirror 16th Mar 2017
Senate probers were asked to look into reports about fake cigarette-tax stamps alleged to have proliferated during the tenure of ex-Bureau of Internal Revenue (BIR) Commissioner Kim Jacinto-Henares. In seeking an inquiry in aid of remedial legislation, Sen. Emmanuel D. Pacquiao cited reports that tobacco firms managed to dodge paying the right taxes by resorting to “fake-tax stamps” on cigarette packs. In an interview, Pacquiao told Senate reporters that Henares could be “held accountable” for the proliferation of fake-tax stamps during her watch. Mighty Corp.’s lawyer Sigfrid A. Fortun added the devices used by BIR examiners on the seized cigarette cartons registered a green light, indicating these were genuine stamps, but later registered red or bogus marks for stamps in the same carton.

PHL meat imports rose to record high in 2016 BusinessMirror 16th Mar 2017
The country’s meat imports rose to its highest in 2016 at 646,503.7 metric tons (MT), 10.28 percent higher than 586,263.900 MT imported in 2015, according to the latest data from the Bureau of Animal Industry (BAI). Data obtained by the BusinessMirror from the BAI also showed that meat imports have been steadily growing: 390,519.15 MT in 2010; 408,741.67 MT in 2011; 411,351.07 MT in 2012; 461,343.01 MT in 2013; and 559,887.34 MT in 2014. The Meat Importers and Traders Association (Mita) attributed this to the continuous expansion in the country’s economy, resulting in an increase in the purchasing power of Filipinos. Data from the BAI, an attached agency of the Department of Agriculture (DA), showed that the US and Germany were the two sources of imported meat last year. The US accounted for 20.33 percent of all the meat imports. Purchases from the US reached 131,443.88 MT, 13.28 percent higher than the 116,035.89 MT recorded in 2015. Meat imports from Germany also rose by 22.3 percent to 92,436.274 MT, from 75,583.428 MT posted in 2015.

Rice output seen hitting 4.44 MMT in Q1, up 13% BusinessMirror 16th Mar 2017
Philippine rice output in the first quarter could expand by nearly 13 percent to 4.44 million metric tons (MMT), from 3.93 MMT recorded a year ago, according to the latest report of the Philippine Statistics Authority (PSA). The latest rice production estimate, however, is 2.1 percent lower than the 4.53 MMT initially projected by the PSA in January, as some palay-producing areas is expected to record slight declines in output. In the January round of its survey, titled “Rice and Corn Situation Outlook”, the PSA said the probable increase in first quarter rice output is due to the expansion in harvest area. The availability of irrigation water and the use of high-yielding rice varieties would also boost production. “Probable increments in production are foreseen in all regions, except Calabarzon,” the report read. However, the latest data in the agency’s report titled, “Updates on Palay and Corn Forecasts”, indicated that typhoons and pests would cut rice harvest in some areas. The PSA said harvest area in the January-to-March period may contract to 1.15 million hectares, from 1.16 million hectares, or by 0.3 percent. Also, yield per hectare may decline to 3.85 metric tons (MT), from 3.92 MT.

4Ps beneficiaries to receive rice subsidy in March Rappler 15th Mar 2017
MANILA, Philippines – Beneficiaries of the Pantawid Pamilyang Pilipino Program (4Ps) will receive an additional P600 cash grant this month as a form of rice subsidy. The Department of Social Welfare and Development (DSWD) said the amount will be given in two installments, meaning P300 every payout period. Only members who comply with the education and health conditions of the program will be given cash grants. The country's version of the conditional cash transfer program releases cash grants to member-families who ensure that their kids go to school and mothers have monthly checkups in their barangay health centers. If certain households do not receive a rice subsidy because of an alleged failure to comply with one of the conditions, they may appeal their case and will be paid retroactively once their compliance is proven.

China to buy $1.7bn worth of Philippine agricultural produce Bangkok Post 15th Mar 2017
MANILA - China on Wednesday signed deals committing it to buy US$1.7 billion worth of fruits and other agricultural products from the Philippines, the latest in a series of agreements in an era of cordial ties under President Rodrigo Duterte. Zhao Jianhua, China's ambassador to the Philippines, said purchases of Philippine products by China could further increase as Beijing seeks to balance trade with Manila. China has been enjoying a trade surplus with the Southeast Asian nation.

DA, DILG, MMDA, PNP sign MoU on 'food lane routes' Northbound Philippines News Online 14th Mar 2017
Metro Manila Development Authority Chairman/General Manager Thomas Orbos, Department of Agriculture Secretary Emmanuel Piñol, Department of Interior and Local Government Secretary Ismael Sueño, Philippine National Police represented by PNP chief Director General Ronald Dela Rosa signed a Memorandum of Agreement on the “Foodlane Project” on Monday (March 13, 2017) in Camp Crame, Quezon City. The project will designate “food lane” routes to ensure efficient delivery of Agri-fishery commodities, reduce post-harvest losses and transportation costs through eliminating additional fees and unnecessary checkpoints which add to some agriculture and fishery products.

SRA allows more sugar exports to US BusinessMirror 14th Mar 2017
The Sugar Regulatory Administration (SRA) said it has permitted traders and millers to export more sugar to the US until August 31 this year to stabilize domestic supply and prices. In Sugar Order (SO) 4, the SRA authorized the advance swapping of “B” or domestic sugar to “A” or sugar for the US market in crop year (CY) 2016-2017, which will end on August 31. “An early shipment of US quota sugar will help ease the pressure of high sugar stock inventory in the country, and help stabilize the sugar situation,” SRA Administrator Anna Rosario V. Paner said in SO 4, which was published on the agency’s web site on March 14. The SRA earlier increased the sugar allocation for local consumers and industries via SO 1-A. The allocation for “B” sugar was increased to 94 percent, from 92 percent, while that of “A” sugar was cut to 6 percent, from 8 percent. The agency pegged the domestic sugar demand for the current crop year at 2.15 million metric tons (MMT). The SRA projected that sugar output in the current CY, which started in September 2016, could reach 2.25 MMT, higher than the 2.236 MMT produced in CY 2015-2016. Paner said the advance swapping of domestic sugar to US sugar is open to all sugar producers, millers, traders and holders of outstanding quedan-permit.

Taiwan-Philippines fishery meeting sees agreement on proposals Focus Taiwan 10th Mar 2017
Manila, March 10 (CNA) Taiwan and the Philippines reached agreement on several fishery cooperation proposals during a meeting held Thursday in Manila, according to Taiwan's representative to the Philippines, Gary Lin (林松煥). In the third Taiwan-Philippines technical meeting on fishery affairs, representatives from Manila answered a request by Taipei, promising efforts to push for the legislation of a "sea-land passage bill" that would allow innocent passage by fishing boats from Taiwan or other countries through waterways between Philippines-controlled archipelagos, Lin said Friday. Such a bill would help to reduce fishing disputes, Lin said, adding that the fishery meetings have helped boost relations between Taiwan and the Philippines and their cooperation in law enforcement efforts related to fishing.

SRA asks Trade dep’t to drop retail price of cane sugar Business World 10th Mar 2017
The Sugar Regulatory Administration (SRA) is appealing to the Department of Trade and Industry to review the current retail price of refined sugar to allow consumers to reap the benefit of lower wholesale prices. “The price of sugar has been falling [at the mill]. We’re hoping the consumer gets to enjoy the lower prices. In the end we produce for the consumer,” SRA administrator Anna Rosario V. Paner told reporters late Tuesday in Quezon City. According to the Department of Agriculture’s price watch monitor, the price of refined sugar in Metro Manila markets averaged P56 as of March 9. Ms. Paner is hoping for a P5 decrease in this rice to bring the commodity in line with lower mill prices. Citing consolidated documents from the Bureau of Customs, Ms. Paner noted that high-fructose corn syrup (HFCS) imports in 2016 hit 5.7 million 50-kilo bags, eating into the market for refined sugar. The refined sugar market was 20 million 50-kilo bags last year. On Feb. 17, the SRA issued Sugar Order No. 3 which asserted the SRA’s authority to regulate HFCS imports to protect the interests of cane farmers.

Japan going bananas for Philippine food exports as trade chiefs eye record business at FoodEx show FoodNavigator-Asia.com 8th Mar 2017
The 17-strong delegation of Philippine food firms showcased at FoodEx Japan this week is targetting record total sales topping US$28m from the four-day event – with banana-based products booming in the Far East. The exhibitors have a strong fruit focus, with products featuring banana, coconut, mango and pineapple, taking centre stage. According to Rosvi Gaetos, executive director of the Philippines Center for International Trade Exhibitions and Missions (CITEM), Japan is the country’s largest destination for fresh food, and second only to the US for processed goods, with business boosted by trade agreements.

Land laws need to be harmonized Arangkada 3rd Mar 2017
Out of control. This is how Elmer Mercado, a former environment undersecretary, describes the state of land use planning in the country. Food security and housing are two main issues in the tug-of-war over land use and, more recently, in the arguments for or against the Department of Agrarian Reform (DAR) proposal to ban for two years the conversion of farms into nonagricultural uses. ADVERTISEMENT But food and housing are just two pieces in the mosaic of overlapping land uses and “conflicting” laws on natural resources. “[Land use] is not only an agrarian issue. It’s an environmental issue. It’s a human rights issue. And it’s a good governance issue,” said Ifugao Rep. Teodoro Baguilat, former chair of the House committee on agrarian reform. Read more: http://newsinfo.inquirer.net/877053/land-laws-need-to-be-harmonized#ixzz... Follow us: @inquirerdotnet on Twitter | inquirerdotnet on Facebook

Australia investment body scouting for Mindanao agri, education opportunities Business World 2nd Mar 2017
DAVAO CITY -- The Australian Trade and Investment Commission is setting the stage for business and trade partnerships between investors from Australia and the private sector in Davao City and elsewhere in Mindanao, particularly in agribusiness, education and training.

Duterte mulling halt in conversion of agri lands philstar.com 1st Mar 2017
The executive order imposing a moratorium on the acceptance of new applications for the conversion of agricultural lands is still being studied but may be issued “soon,” Malacañang said Wednesday. Presidential spokesman Ernesto Abella said the Offices of the Executive Secretary and the Cabinet Secretary have convened to discuss the draft order, which was intended to promote food security. “The fourth version is already with ES (executive secretary) and that's under study and that should come out soon,” Abella said in a press briefing. In September, agrarian reform secretary Rafael Mariano said his agency has drafted an executive order imposing a two-year moratorium on the conversion of agricultural lands.

Illegal-fishing activities in Negros Occidental down by 90%–official Business Mirror 1st Mar 2017
Illegal-fishing activities within  the Tañon Strait in Negros Occidental declined by 90 percent, after the government launched its intensified campaign against illegal, unreported and unregulated fishing,  and created Task Force Lawod in March 2014. “From an average of 100 fishing vessels, which regularly encroach on the municipal fishing grounds of various coastal towns in the province, the number of  violators dropped to less than 10,” Provincial Environment Management Officer Wilfred Ramon M. Peñalosa said. This as a significant development, especially since Negros Occidental is backing calls to protect the Tañon Strait Protected Seascape (TSPS), one of the largest marine-protected areas (MPAs) in the country.

Sugar industry regulator intervenes to restrict imports of corn syrup Business World 1st Mar 2017
The Sugar Regulatory Administration (SRA) has decided to regulate the importation of high-fructose corn syrup (HFCS), the use of which by industrial users is alleged to have dampened sugarcane demand. In its Sugar Order No. 3 dated Feb. 17 posted on its website, the SRA mandated that an importer or consignee of imported HFCS, and chemically pure fructose, must be an international trader duly registered with the SRA at the time of the application for clearance for release. Applicants for the release of imported HFCS and chemically pure fructose must also submit to SRA various requirements, before the application can be accepted for processing. The SRA further provides that the clearance for the release will indicate the classification of the fructose as either “B” for domestic market, “C” for reserved, and “D” for world market. Non-compliance with the new policies will make the importer or consignee liable to penalties as recommended by law. The SRA order was prompted by complaints from sugar industry stakeholders of the HFCS importation which “negatively affects the balance of production,” “threatens the livelihood of industry workers” and “impedes the growth of the sugar industry.” There was some debate whether the SRA had the authority to intervene since the commodity does not derive from sugarcane, the SRA board acknowledged. To this end, the SRA cited Executive Order 18, empowering the agency to maintain a “balanced relation between production and requirement” of sugarcane “at a level profitable to producers and fair to consumers.” Often used in combination with sugar, HFCS makes up a greater share of ingredients than sugar in soft drinks. The processing of corn products is more industrialized than that of cane sugar, leading to cost efficiencies that make it a preferred product for large-scale food enterprises.

DA 7 to scrap irrigation fees for farmers in Cebu, Bohol SunStar 18th Feb 2017
THE Department of Agriculture (DA) will scrap the fees on irrigation system required of farmers in Cebu and Bohol. DA 7 Director Salvador “Salva” Desputado said that the farmers should be given free water from the government’s irrigation system. He said that right now, President Rodrigo Duterte, through the DA secretary, is working on the food security program of the country, and along this line is the DA program to reformat the agricultural sector.

Stakeholders want QR on rice extended Manila Bulletin Business 16th Feb 2017
Some stakeholders in the rice sector, particularly the poor and small rice farmers, demand that the government proceed with the negotiation to extend the import restrictions on rice. To recall, it is only the Department of Agriculture (DA) that believes the country needs at least two more years to be prepared for the liberalization of rice importation in the country. Quantitative Restriction (QR) is the limit to the volume of goods traded by a country. QR on rice, for instance, protects local farmers from foreign rice imports by imposing a high 35-percent tariff rate on them after hitting certain shipment limit. The World Trade Organization (WTO) granted the Philippines with an initial exemption from the lifting of QR on rice because of its highly sensitive nature but the deadline for the country’s QR has already been extended twice, with the second extension expiring in June of this year.

Crop insurance paid to farmers reached P1.6 billion in 2016 Manila Bulletin Business 14th Feb 2017
The government only granted crop insurance worth P1.6 billion to farmers in 2016, a measly figure compared to the billions worth of damage that the agriculture sector had incurred due to several typhoons that hit the country last year.

Strategic directions for Philippine agriculture Manila Bulletin Business 11th Feb 2017
Fully exploiting the potential of our vast fisheries and aquatic resources rural poverty and lack of productivity of Philippine agriculture trace their roots to many causes. Parts 1 and 2 of this series called attention to three of the most serious shortcomings, namely 1) problems associated with small, fragmented farm holdings, 2) insufficient linkages of primary producers to markets, and 3) lack of product diversification and value adding (processing) especially at the village level. The fourth, and last, shortcoming has to do with our failure to fully exploit the potential of our vast fisheries and aquatic resources.

Thailand's biggest agri company to invest $2B in PH within 5 years ABS-CBN News 25th Mar 2017
Thailand's largest agricultural company is set to pour in $2 billion to expand its pork and chicken production in the Philippines in the next five years, Agriculture secretary Emmanuel Piñol said. Charoen Pokphand Group (CP Group) chairman Dhanin Chearavanont said they decided to invest more in the Philippines because of its distinction as the only country in the whole of Asia which is free from foot and mouth disease (FMD) and avian influenza or bird flu, Piñol said in a statement. The expansion is expected to generate at least 2,000 jobs, and increase the local demand for corn and soybeans that will be used as part of the company's feed production, Piñol said.

Health & Life Sciences

Air ambulance launched for remote Philippine areas GulfNews 22nd Mar 2017
Manila: The Philippine government has launched an air ambulance service for patients requiring immediate medical attention in remote areas of the country. According to the Department of Health, patients in island communities and remote areas of the MIMAROPA region (Oriental/Occidental Mindoro, Marinduque, Romblon and Palawan) can now avail air ambulance services. Regional health director Eduardo Janairo said most areas in MIMAROPA are not accessible to regular ambulance services due to difficult terrain.

Pioneering ICT-based healthcare solutions at the National Telehealth Center, Philippines OpenGov 21st Mar 2017
OpenGov had the opportunity to speak to Dr. Portia Grace Fernandez-Marcelo, Director of the UP (University of Philippines) Manila-National Telehealth Center (NTHC) about using ICT to provide equitable access to quality healthcare for all, specially in isolated and disadvantaged communities. NTHC is one of the pioneers in the Philippines developing cost-effective ICT tools and innovations for improving healthcare and deploying solutions in communities where they are required most urgently. The Center partners with various government and non-government institutions  in the areas of eMedicine, eRecords, eSurveillance, eLearning and eHealth Policy Advocacy, . Today, local governments have better awareness about the need to integrate health systems. It’s a good start. And communities themselves are witnessing success stories and appreciating the potential of these solutions. 

Surgeon to head PhilHealth philstar.com 11th Mar 2017
MANILA, Philippines -  Surgeon Hildegardes Dineros is taking the reins of the Philippine Health Insurance Corp. after President Duterte nominated him to the post and an election by the PhilHealth board last Tuesday. Dineros, a bariatric and metabolic surgeon, plans to achieve universal healthcare coverage (UHC) for Filipinos. He also intends to lay policies that will ensure the coverage “equates with care.”  The 56-year-old doctor also sees the need to “concretize” PhilHealth’s ID system through a “unified registration” to get the needed information even from non-members. Four other doctors have been appointed members of the PhilHealth board: Ma. Jude de la Serna, (overseas Filipino migrant workers); Joan Cristine Reina Liban-Lareza (health care providers); Roy Ferrer (employer sector) and Roberto Salvador Jr. (formal economy).

Colorectal cancer now Philippines' number 1 cancer philstar.com 8th Mar 2017
MANILA, Philippines — Colorectal cancer is the number one gastrointestinal cancer in the Philippines, overtaking liver cancer, an expert said. Just last year, a global research even found out that the Philippines has the highest increase in mortality among the 37 countries surveyed, Dy noted. This means, he said, that CRC patients in the Philippines die faster than those in other countries.

Dineros named Interim PhilHealth President and CEO Philippine Information Agency 22nd Mar 2017
Dr. Hildegardes C. Dineros is the interim President and CEO (PCEO) of the Philippine Health Insurance Corporation (PhilHealth). He was named interim PCEO in the March 10 meeting of the PhilHealth Board of Directors held in Pasig City. A graduate of the University of Santo Tomas, Dineros is a surgeon by profession. He performs basic and advanced laparoscopic procedures, surgical endoscopy and general surgical procedures, and is also into bariatric, metabolic, general and cancer surgery. His scope of interests includes complex wound care, aesthetic and plastic surgery, bariatric medicine, spirituality, health, and medicine, as well as stress and energy management. He is a Fellow of the American College of Surgeons, the Philippine College of Surgeons and the Philippine Society of General Surgeons. He is a Diplomate of the Philippine Board of Surgery and is a Fellow of various Philippine, Asian and American societies of bariatric and metabolic surgery, wound care, laparoscopy and endoscopy surgeons. He has lectured on obesity and bariatric surgery before local and international audiences and has granted various tri-media interviews here and abroad. He is actively involved in community initiatives as President of the Nuestra Senora de Salvacion Charity Hospital Foundation Inc. which holds medical missions in Northern Samar. He is the Founder of Smile Forever Program and is the Past President of Sagip Bayan Foundation of St. Luke’s Medical Center in Quezon City. He is also a member of the Aloha Medical Mission of Hawaii, USA, Tzu Chi Foundation of Taiwan and the Good Samaritan Foundation of media personality Ramon Tulfo.

Doctor shortage philstar.com 19th Mar 2017
Taxpayers spend P2.5 million over four years to produce a graduate of the Philippine Military Academy. Why not make the same investment in producing surgeons and other physicians? The proposal was made by Senate President Pro Tempore Ralph Recto, who noted that the Department of Health already has an existing scholarship program for aspiring doctors. All that’s needed is to expand the program while at the same time making compensation and benefits more attractive for physicians working for the DOH. Unless remuneration is improved, the nation may see its shortage of doctors worsen, especially in rural areas. Recto noted that of the 946 available slots in the government’s Doctor to the Barrios program from 2015 to 2016, only 320 were filled. The program is meant to provide at least one doctor in each low-income municipality, but there were few takers. Those 626 unfilled slots meant that millions were deprived of the services of a doctor in their communities. The medical profession can pay handsomely – but only after many years of grueling studies and substantial financial investment in schooling and specialized training. The cost of medical textbooks alone can be beyond the reach of a low-income household. If the government shoulders the schooling expenses of deserving medical scholars, the nation may be assured of a steady supply of physicians, even if the beneficiaries leave the DOH after a mandatory four-year service. The government may then have at least one doctor for every municipality, with the scholars encouraged to serve in their hometowns. Health experts estimate that the country currently faces a shortage of 60,000 doctors. This means six out of every 10 Filipinos die without seeing a doctor. This need not be the case. The government is recruiting more police and military personnel. Why not boost resources to produce and recruit more doctors?

PH continues work with USAID despite Duterte’s tirades INQUIRER.NET 12th Feb 2017
Despite President Rodrigo Duterte’s public pronouncement that the Philippines could survive without US development assistance, his administration continues to work with the US Agency for International Development (USAID). “We continue to have programs with them and no one has asked us to leave or to discontinue… We continue to work together,” said Gloria Steele, acting assistant administrator for USAID’s Bureau for Asia. In fact, the USAID team in Manila had its first meeting with its Philippine counterparts last January under the two new administrations of Mr. Duterte and US President Donald Trump.

ICT

Data Processing Systems Registration Due in 6 Months Quisumbing Torres 27th Mar 2017
Data controllers and processors operating personal data processing systems in the Philippines should by now, at the very least, have commenced steps to comply with the registration requirement under the Implementing Rules and Regulations (“DPA Implementing Rules”) of the Data Privacy Act of 2012, due on 9 September 2017. Full compliance with the DPA Implementing Rules may not be achieved easily in a day. Failure to comply with the DPA Implementing Rules may mean not only mandatory business closure for the controller and processor, but also payment of damages and of steep fines. For responsible officers and employees, non-compliance by their organizations may even result in imprisonment. Data processing systems operating in the Philippines and processing the sensitive personal information1 of at least 1,000 individuals, whether it be of employees, clients, customers, or contractors, are required to register with the National Privacy Commission (“NPC”).2 The NPC’s rules on said registration, expected to be issued within this March, shall require the following at a minimum: Proof of appointment of a Data Protection Officer (DPO); Privacy Impact Assessment (PIA) for each covered process; Privacy and data protection policies; Proof of data privacy training awareness within the applicant’s organization; Description of each data processing system and of the manner of processing; and Data handling practices within the applicant’s organization.

Smartphone boom driving jump in digital payments in the Philippines The Straits Times 19th Mar 2017
In the Philippines, cash is still king. Just one in 10 Filipinos transact online via their bank accounts, although half the nation's population of 102 million are already using the internet. Out of 2.5 billion bank payments worth US$74 billion (S$105 billion) each month, only 1 per cent, or about US$740 million, are electronic and most payments involve small amounts. This equates to roughly US$60 a month for the 11 million people who make online payments via their bank accounts. The vast majority of bank transactions, by value, are still by cash or cheque. "It's more 'cashlite' than 'cashless' in the Philippines," said Ms Nick Wilwayco, head of communications at e-commerce firm PayMaya. A boom in mobile phone use, though, could soon change things. The Philippines is the fastest-growing smartphone market in South-east Asia. There are currently 40 million Filipinos with smartphones and that number is forecast to hit 90 million by 2021. Banks have long been a hurdle to greater take-up of online payments. Only three in five Filipinos have bank accounts and among these are the 11 million who pay their bills, order takeout and buy plane tickets, gadgets, clothes, and fashion accessories online, using their ATM, credit and debit cards. Many still worry about security and privacy. In a report released in July last year (2016), internet security firm Trend Micro said the Philippines is the third most affected country when it comes to online banking fraud. Which is why smartphone apps have proved so appealing because it frees up people from having to use bank accounts to make payments or indeed even having a bank account.

Many PH firms unprepared for cyber attacks – SGV Rappler 17th Mar 2017
A vast number of Philippine firms are unprepared for cyber attacks, according to a new survey by Professional services firm SGV & Co (SGV). At least 60% of firms surveyed in the Philippines said they do not have a security operation center and have zero or just informal threat intelligence programs, according to the latest Global Information Security Survey released last week by EY Global, SGV’s global parent. SGV said a significant majority of local firms consider careless employees and criminal syndicates to be the most likely source of an attack. In addition, more than 50% of the survey participants said they have not experienced a major attack while 25% of those that have experienced attacks said they were not aware of the extent of the financial damage to their organizations. The survey of 1,735 organizations, including those in the Philippines, globally examines pressing cybersecurity issues facing businesses today in the digital ecosystem. Cybersecurity is particularly relevant given that two high-profile incidents last year, the Bangladesh bank heist and the hacking of the Philippine election data, demonstrated the weakness of the country’s network security infrastructure. Another indication of the heightened threat facing the country is the recent establishment of a new security center by Globe Telecom, which the telco will also offer as a service to other firms.

Duterte to revive NBN; ZTE keen to help again InterAksyon.com 9th Mar 2017
A decade after a plan to interconnect government offices throughout the country via the Internet ended up in a massive corruption scandal that nearly toppled the Arroyo administration, such a plan is now being revived by the Duterte administration. Department of ICT Secretary Rodolfo Salalima confirmed that President Rodrigo Duterte greenlighted their plan to establish a National Broadband Program or NBP. Salalima said his office will undertake stakeholder consultations and submit a more detailed rollout plan to the president afterwards. If things go as planned, the project timeline calls for selection of project proponents by early next year. Aware of the ghosts from the past, Salalima has vowed to make the program as open as possible. Salalima said at least three Chinese firms have expressed interest in the plan. ZTE, the original proponent 10 years ago before the $329 million plan was scrapped, told InterAksyon they are keen to participate. Another Chinese firm, Huawei, is also willing to join. Under the draft program, the NBP will initially provide entry-level speed of two Mbps to government offices and missionary areas, which will then be ramped up to 10 Mbps by 2020. Aside from interconnecting government units, the plan also envisions propagation of government e-services to rural areas, such as distance learning, tele-health, and tele-commuting platforms.

Duterte approves national broadband plan philstar.com 6th Mar 2017
President Rodrigo Duterte on Monday approved the national broadband program, a project that was canceled during the Arroyo administration following corruption allegations, his Agriculture secretary said. The matter was discussed during the Cabinet meeting in Malacañang on Monday, Agriculture Secretary Emmanuel Piñol said in an online post. “President Rody Duterte has approved the establishment of a national government portal and a national broadband plan during the 13th Cabinet meeting in Malacañang today (March 6),” Piñol said. “After a presentation made by Department of Information and Communications Technology Secretary Rodolfo Salalima, President Duterte emphasized the need for faster communications in the country,” he added. Piñol, who is not an official spokesperson but was present during the meeting, said Duterte had wanted “to develop a national broadband plan to accelerate the deployment of fiber optics cables and wireless technologies to improve internet speed.” An executive order is needed to implement the national government portal. In the same meeting, Duterte said he would ask the Budget department to “review and work for the amendment” of the government procurement law, especially on the provision that prefers the lowest bids for state projects. “President Duterte said the lowest bid does not guarantee quality products being procured by government,” Piñol said.

Latest Regulatory Changes Give Bitcoin Startups in the Philippines A Chance to Survive NEWSBTC 28th Feb 2017
Bitcoin startups are often hindered in their efforts by rather strict regulation. Even though cryptocurrency has made an impact in the Philippines already, the regulatory guidelines remain somewhat of a hurdle. That has come to change, as recent changes seemingly favor companies dealing with bitcoin. In the end, this is a positive change that may benefit bitcoin adoption in the Philippines moving forward. The Guidelines for Virtual Currency Exchanges document contains some intriguing information. On the one hand, the Bangko Sentral acknowledges the disruptive success of bitcoin and cryptocurrencies. With faster and more convenient trades and transactions, it is evident cryptocurrency has a leg up over traditional offerings. However, virtual currencies are a systemic risk for money laundering and terrorist financing as well.

House to summon FB, Twitter execs philstar.com 25th Feb 2017
The House of Representatives will soon summon officers of social media networks like Facebook, Twitter and Instagram. Speaker Pantaleon Alvarez said yesterday the officers would be invited to a hearing on his bill that seeks to regulate social media. He said even before the House could conduct a hearing, representatives of some social media networks have conveyed to him their readiness to cooperate in the formulation of a regulatory measure. Alvarez filed Bill 5021, the proposed Social Media Regulation Act. Under the bill, every social media user “must observe a responsible and fair exercise of his right to free expression and opinion.” “He is, however, prohibited from opening an account for his online presence using someone else’s identity and present himself to the online world as that person whom he is not,” the measure provides. It also makes social media networks responsible for ascertaining the veracity of the identity of a user of their platform. Violators would face imprisonment of six years to 12 years and a fine of P30,000 to P50,000. Bill 5021 defines social media as “any electronic medium that allows interaction among people in which they create, share or exchange information and ideas, including but not limited to uploading or downloading videos, still photographs, blogs, video blogs, podcasts, instant messages, electronic mail or Internet website profiles or locations.” Alvarez also filed a resolution asking the House to inquire into why social media networks have failed to check on the identity of their users.

Amdocs to expand local market reach | BusinessMirror Business Mirror 18th Feb 2017
SOFTWARE solutions developer Amdocs Ltd. said it is now time to push further to promote the brand in the Philippines. “Amdocs is not a fast-moving consumer good [FMCG]. The consumer world does not need to know us,” Alita Wong, Amdocs Asia Pacific head of marketing, told reporters. “Within the service provider, local system integrator and the local solutions in the Philippine industry environment, we want to go up more.”

Grab extends GrabShare carpooling service to Malaysia and the Philippines Tech in Asia 16th Feb 2017
Southeast Asian ride-hailing app Grab is expanding its GrabShare service to Malaysia and the Philippines, it announced today. GrabShare is Grab’s version of UberPool, its competitor’s multiple-passenger ferrying service.

Infrastructure

Closure, redevelopment of Naia pushed Inquirer.net 20th Mar 2017
The Philippines could realize massive investments to the tune of P5.4 trillion by closing and redeveloping Manila’s Ninoy Aquino International Airport, the Philippines’s main air gateway. This was according to conglomerate San Miguel Corp., which made an unsolicited offer to build a subsidy-free P700 billion international airport and city complex in Bulakan, Bulacan within six years. A document, prepared by SMC’s infrastructure arm, also detailed the heavy cost associated with capacity limitations at Naia, which was surrounded by dense residential and commercial areas, thus limiting expansion options. ADVERTISEMENT SMC said delays had been costing airlines P1.1 billion yearly, and this would increase to P3.8 billion by 2020 if the situation would not change. For passengers, productivity losses also carry a hefty price tag: P2.8 billion today and P11 billion by 2020. SMC, a food and beverage giant that is continuing its diversification into infrastructure, said the solution was to build an entirely new airport, in this case, on a 2,500-hectare property along Manila Bay in Bulacan. It rivals another offer from Belle Corp. and the Solar Group to reclaim 2,500 hectares of land in offshore Sangley, Cavite to be redeveloped into an airport, seaport and industrial zone.

Phl, China sign joint dev’t plan philstar.com 19th Mar 2017
MANILA, Philippines - China and the Philippines have signed a six-year economic cooperation plan to boost trade and investments. Socioeconomic Planning Secretary Ernesto Pernia and China International Trade Representative and Vice Minister of Commerce Fu Ziying signed the Six Year Development Program (SYDP) for Trade and Economic Cooperation between the Philippines and China during a meeting in Davao City. Also tackled during the meeting was the possibility of extending support for the conduct of feasibility studies for two infrastructure projects which include the Panay-Guimaras-Negros Bridges and the Davao City Expressway. The two countries likewise discussed general updates on bilateral and financing cooperation, infrastructure, trade, investments, agriculture, fishery, and tourism.

WHILE BOOSTING BANKING, INSURANCE SECTORS: Big-ticket infra projects to create jobs, fuel economy | Malaya Business Insight Malaya Business Insight 17th Mar 2017
Finance secretary Carlos Dominguez III said some P326 billion worth of projects have begun construction or will be built starting this year which would lead to a “blossoming of opportunities” for Filipino businessmen. Dominguez said businesses should expect to be busy starting this year as the Duterte administration rolls out big-ticket infrastructure projects that would, in turn, stimulate the economy, create jobs and generate more financing opportunities for the country’s banking and insurance sectors. He added the stronger linkages forged with development partners and regional neighbors will provide new drivers for the growth of the domestic economy.

P326 B infra projects on stream philstar.com 17th Mar 2017
MANILA, Philippines -  About P326 billion worth of infrastructure projects have been started or are in the pipeline for implementation this year, the Department of Finance (DOF) said.

PNOC gets 26 unsolicited offers for LNG hub | Malaya Business Insight Malaya Business Insight 17th Mar 2017
Philippine National Oil Co. (PNOC) president and chief executive officer, Reuben Lista said that so far, they already received 26 unsolicited offers both from local and abroad for the construction of a liquefied natural gas (LNG) hub in the country. The official noted that from the 26 firms, seven are from China; six from Japan; three from Singapore; three local firms; two from South Korea; two from Turkey; one from United Arab Emirates; one from Spain and another one from Australia. “This will be an LNG integrated systems complete with a power plant, storage, regasification and liquefaction (facilities.) Whether off shore, on shore or near shore it is already (dependent on) their computations,” Lista added during his briefing to reporters in Taguig. PNOC said that they are expecting more proposals to come but noted that they will be open only until the end of April before making a final shortlist which Lista said could end up with seven parties at most.

New fund sources open up for PH Inquirer.net 16th Mar 2017
The Philippines’ pivot to its Asian neighbors is opening up more sources of funds as China and Japan compete for the financing of local infrastructure projects. While the Chinese government is expected to firm up its commitments when China Vice Premier Wang Yang visits the country this week, the Japanese are trying to catch up, such that Philippine economic managers will meet with the Japan International Cooperation Agency (Jica) later this month to identify projects it would finance, Socioeconomic Planning Secretary Ernesto M. Pernia told reporters.

Philippines: First Metro Manila Bus Rapid Transit Line to Benefit Thousands of Commuters Daily World Bank 16th Mar 2017
WASHINGTON, March 16, 2017 – The World Bank’s Board of Executive Directors today approved funding for the first bus rapid transit (BRT) system in Metro Manila which will provide safe, reliable, and comfortable rides for about 300,000 commuters daily along España Boulevard and Quezon Avenue. Like trains, BRTs run on dedicated lanes, carrying passengers in large numbers. Unlike trains that run on rails, however, BRTs deploy buses, making the system simpler and cheaper to construct, operate, and maintain. The Metro Manila BRT Line 1 Project will cost $109.4 million, of which $64.6 million will come from the World Bank and the Clean Technology Fund (CTF). The Philippine government will provide funding equivalent to $44.8 million. Pioneered in Curitiba, Brazil in 1974, BRT systems are growing in popularity throughout the world for efficiency and affordability. From Bogotá to Boston, Cleveland to Curitiba, Hartford to Honolulu, Las Vegas to Los Angeles, Oakland to Ottawa, Pittsburgh to Porto Alegre, and São Paulo to Sydney, Ahmedabad to Jakarta, over 150 cities operate or are developing BRT.

DPWH oversees NLEX-Harbor link project | BusinessMirror Business Mirror 16th Mar 2017
PUBLIC Works Secretary Mark A. Villar recently inspected the ongoing North Luzon Expressway (Nlex)–Harbor link project of Manila North Tollways Corp. (MNTC), which was held at Karuhatan Village in Valenzuela City. The Nlex-Harbor link and Connector Road Projects are expected to bring the following benefits once it is finished, such as decongest Manila, as it provides alternative access to mainline Nlex; bypassing Edsa and Balintawak Toll Plaza; shorten travel distance by establishing direct routes between the North Luzon, Camanava and Northern Manila areas; cut travel time by almost half as it allows an average speed of 80 kilometer per hour; improve movements of cargo trucks, as they will not have to worry anymore on the truck ban; lower incidence of road accidents due to better road pavement; and tighter traffic management. The project is also expected to spur economic activities in the Camanava area and increase land value, as well, improve transport logistics with more efficient movement of trucks in and out of the ports in Manila, stimulate commerce between Port Area, Central and Northern Luzon and, last, it generate about 10,000 jobs during the construction phase. “I am really hoping that the project is finished before December,” Villar said.

Infra spending to hit 7.4% of GDP by 2022–Pernia BusinessMirror 26th Mar 2017
The Duterte administration’s infrastructure spending would reach 7.4 percent of GDP by 2022 with the expected completion of 55 “flagship projects”, according to the chief of the National Economic and Development Authority (Neda). Socioeconomic Planning Secretary Ernesto M. Pernia said the increase in infrastructure spending is in keeping with the government’s goal of cutting poverty incidence by creating more jobs. “So, for the whole term of President Duterte, the cumulative amount spent on infrastructure would be close to P9 trillion,” Pernia said.

Insurers help to pay for Asia's infrastructure needs Nikkei Asian Review 23rd Mar 2017
A recent $150 million refurbishment of two decades-old geothermal power plants on the Philippine island of Luzon may sound like just another project aimed at overcoming the country's severe electricity shortages. But, for Asia's insurance companies, there is more to it. Bonds issued to pay for the upgrades and future operation costs, worth 10.7 billion pesos ($213 million), were backed by the Asian Development Bank -- the first such project bonds issued in Southeast Asia, excluding Malaysia, since the 1997 Asian financial crisis. Investors see infrastructure projects as risky, especially green-field assets that take a long time to bear fruit. But credit enhancement -- backing by a multilateral lender, for example -- helps reduce the risk of default, encouraging institutional investors such as insurance companies and pension funds to put money into them.

LRMC ready to break ground for P30-billion LRT line to Cavite BusinessMirror 20th Mar 2017
Train operator Light Rail Manila Corp. (LRMC) is gearing up for the groundbreaking of the multibillion-peso extension of the Light Rail Transit (LRT) Line 1 to Cavite, albeit a little late from the original target, as it waits for the gosignal from the office of President Duterte. Metro Pacific Investments Corp. President Jose Ma. K. Lim said in an interview his group is ready to break ground for the roughly P30-billion facility, as the first package of the right-of-way has been delivered by the government. “For Phase One, we have received five and a half kilometers [km] or six km of right-of-way. It is complete. We are just waiting for the President to tell us when it is fit to break ground for the extension,” he said. A source familiar with the matter said the groundbreaking is slated for April.  The group was looking at scheduling the groundbreaking ceremony sometime in February or March. Targeted for completion in about four years after the delivery of right-of-way, the 11.7-kilometer Cavite Extension will connect into the existing system immediately south of the Baclaran Station and run in a generally southerly direction to Niyog, Cavite. It will consist of elevated guideways throughout the majority of the alignment, except for the guideway section at Zapote, which will be located at grade. Eight new stations will be provided with three intermodal facilities across Pasay City, Parañaque City, Las Piñas City and Cavite. The new stations are Aseana, MIA, Asia World, Ninoy Aquino, Dr. Santos, Las Piñas, Zapote and Niyog. The intermodal facilities shall be located at Dr. Santos, Zapote and Niyog.

World Bank approves $64.6M funding for Manila's BRT line GMA News Online 17th Mar 2017
The World Bank (WB) on Friday approved the funding for Metro Manila's first bus rapid transit (BRT) system. The Metro Manila BRT Line 1 will cost $109.4 million, of which $64.6 million will come from the WB and the Clean Technology Fund (CTF), the lender said in a statement posted on its website. Managed by the Washington-based WB, the CTF provides developing countries and emerging economies with resources to scale up clean technologies that have strong potential for reducing greenhouse gas emissions. The Philippine government will fund the remaining $44.8 million of the project, the multilateral lender said. “By providing an affordable and convenient public transport option, this project will help make job and education opportunities more accessible, especially for the poor residing around the BRT route,” WB Country Director Mara Warwick said. According to the WB, the BRT project will provide safe, reliable, and comfortable rides for about 300,000 commuters daily along España Boulevard and Quezon Avenue. Like trains, BRTs run on dedicated lanes, carrying passengers in large numbers. Unlike trains that run on rails, however, BRTs deploy buses, making the system simpler and cheaper to construct, operate, and maintain. Expected to be operational by 2020, the project will be implemented by the Department of Transportation in coordination with the local governments of Manila and Quezon City.

P326-B infrastructure projects start this year Business World 17th Mar 2017
The Finance Department said groundbreaking is expected this year on three railway projects outside Metro Manila, as well as new public transport lines along the main Metro Manila artery, Epifanio de los Santos Avenue (EDSA). Among those to start construction this year are the Clark-Subic rail line, the Tutuban-Clark rail line, the 581-kilometer South Line of the North-South Railway Project connecting Tutuban, Calamba, Batangas and Bicol, Finance Secretary Carlos G. Dominguez III said in a speech in Makati City on Wednesday. According to an earlier report from the Finance Department, the Department of Transportation (DoTr) will be the implementing agency of the rail projects, with funding to be a combination of Official Development Assistance, public-private partnership concessions, and government funds. The Finance Secretary also said that projects at Clark International Airport, the Metro Manila Bus Rapid Transit traversing EDSA, and three bridges across the Pasig river will commence construction this year. Moreover, Mr. Dominguez added: “We are also closely working with our Chinese partners to finally start the construction of the Kaliwa Dam and Chico River Dam this year.” The projects are worth a combined P326 billion, according to Mr. Dominguez.

5 regional airport PPP deals attract more honchos Rappler 13th Mar 2017
Ayala Corporation's infrastructure group and Lucio Tan-led Asia's Emerging Dragon Corporation could go head-to-head with other top listed conglomerates for the development, operations, and maintenance of 5 unbundled regional airports in Bacolod, Davao, Iloilo, Laguindingan, and Bohol. These two groups, along with other foreign and local companies, attended the pre-qualification conference on the public-private partnership (PPP) projects in Mandaluyong City on Monday, March 13. If they push through with the bidding, AC Infrastructure Holdings Corporation and Asia's Emerging Dragon will battle with a consortia led by Metro Pacific Investments Corporation (MPIC), Aboitiz InfraCapital Incorporated, San Miguel Holdings Corporation, Filinvest Development Corporation, and Megawide Construction Corporation. Although these big local investors were lured in by the unbundled airports, a couple of them are finding it difficult to partner with global airport operators because of the size of the airports. Previously pre-qualified bidders in the bundled airport project are considered pre-qualified in these unbundled deals, provided that there are no changes in their legal, technical, and financial capacities. Regional airports being auctioned off under the PPP scheme are: the P20.26-billion Bacolod-Silay Airport, the P30.40-billion Iloilo Airport, the P40.57-billion Davao Airport, the P14.62-billion Laguindingan Airport, and the P2.34-billion New Bohol (Panglao) Airport. Both officials of MPIC and Aboitiz have raised concern on the 10% equity requirement of an airport operator to a participating consortium. "I think one of the big considerations really is the equity requirement. The transportation department has set the qualification documents submission deadline on May 11, and the bid proposals submission on December 8. The department plans to award these regional airport projects by January 2018.

Bundle… unbundle philstar.com 3rd Mar 2017
There were two low hanging fruits at DOTr when Sec Art Tugade assumed office. One was the privatization of the operations and management of NAIA which would make the quality of its service more competitive in ASEAN. The other involves the bundling of five domestic airports – Davao, Iloilo, Laguindingan (CDO), Bacolod and Bohol – for the privatization of its operations and management. Both have been cleared by NEDA. The process of bidding out the O and M of the bundled airports was in a very advanced stage compared to the NAIA project. Indeed, the actual bidding should have been done by the Jun Abaya team during the last quarter of their watch. But for some unexplained reason, they got cold feet and stopped the bidding. They had pre-qualified some of the better known local conglomerates, who were bewildered by the decision to delay the bidding. When Sec. Tugade took over, his usec for aviation Bobby Lim told me the bidding would finally be held. The DOTr had just delayed the bidding for a month at the request of some of the bidders who needed more time to finalize their bids. Then, all of a sudden, Sec. Tugade cancelled the bidding altogether and decided to unbundle the airports. The Tugade decision was a surprise. It frustrated the bidders who were raring to go. If the bidding was held as scheduled, it could have been the first important PPP project of the Duterte administration. It could have served notice the DOTr is on the ball and justified our high expectations of a decisive Art Tugade. Unbundling will cause significant delay. That means they must recast the terms of reference and conduct separate bidding for each of the five airports instead of just one. It also means they have to go back to NEDA. There will be considerable delay in implementation.

Gov’t sets infra links for 12 industries | Malaya Business Insight Malaya Business Insight 1st Mar 2017
Twelve priority manufacturing and service industries are set to benefit from an infrastructure convergence program of the Department of Trade and Industry (DTI) and the Department of Public Works and Highways (DPWH). The Roads Leveraging Linkages for Industry and Trade (ROLL IT), which aligns the country’s infrastructure development projects with industry and trade development thrusts, identified these as:electronics manufacturing services, automotive and auto parts, aerospace parts, chemicals, shipbuilding, furniture and garments, tool and die, agribusiness as part of the manufacturing sector, information technology-business process management, transport and logistics, tourism and construction industries. In a recent consultation, the DTI’s industry development arm, Board ofInvestments (BOI), urged industry stakeholders to already prepare their infrastructure project proposals intended to further spur the local industries’ growth, development and competitiveness. ROLL IT is a convergence program between DTI and DPWH to jointly undertake the planning, budgeting, advocacy for legislation, identification, evaluation, prioritization, regulation, supervision, implementation, and monitoring and evaluation of industry development infrastructure projects in priority economic and manufacturing zones in the Philippines. ROLL IT is covered by a memorandum of agreement between the DTI and the DPWH as an offshoot of the Manufacturing Summit in 2016.

San Miguel's Ang Offers $14 Billion Airport for Manila Bloomberg.com 16th Feb 2017
The battle of Philippine tycoons to build a new airport to serve the nation’s capital is heating up as San Miguel Corp. proposed a 700 billion-peso ($14 billion) facility, rivaling an offer from a group led by billionaire Henry Sy. San Miguel shares rose to the highest in more than three years. The conglomerate has submitted a plan to the Department of Transportation with a provision for up to six runways in a 2,500-hectare property in Bulacan province, President Ramon Ang said in a phone interview. It will be built without any guarantee or a subsidy from the government, he said. Philippine President Rodrigo Duterte, who has vowed to boost infrastructure spending to a record, is also counting on private investors to upgrade facilities as Manila struggles to cope with rising flight traffic and road congestion. All-Asia Resources & Reclamation Corp., a venture of Sy’s Belle Corp. and Solar Group, in October said it proposed to spend $20 billion to build an airport and seaport near a naval and air base at Sangley Point, south of Manila. The airport in Sangley could be up and running in four to five years’ time, All-Asia Resources said in a statement Thursday. Air passengers passing through Manila will probably more than double to 140 million by 2035 from about 60 million in 2014, according to the International Air Transport Association. The present airport, with four terminals, is already handling traffic in excess of its capacity of 31 million fliers a year, according to IATA.

Manufacturing

Foreign investments seen to sustain upsurge philstar.com 21st Mar 2017
MANILA, Philippines - Despite external economic challenges, the Philippines continues to see strong inflow of foreign direct investments (FDI), driven by the recovery in the manufacturing sector  and  the sustained growth in the services sector, according to the Bangko Sentral ng Pilipinas (BSP).

DTI Rejects Car Industry’s Tax Hike Counterproposal Carmudi Philippines Journal 16th Mar 2017
In an attempt to convince the Department of Trade and Industry (DTI) to lower the tax rate and ceiling on the impending tax hike set to be implemented in 2018, car brands, dealerships and associations banded together and came up with a counterproposal that justifies their stand. According to the Association of Vehicle Importers and Distributors (AVID) and the Chamber of Automotive Manufacturers of the Philippines Inc. (CAMPI), the proposed automotive excise tax increase is “too heavy” for the local automotive industry to bear. The groups combined to make a joint position paper on House Bill 4774. However, DTI Secretary Ramon M. Lopez said he will not support the groups’ call to lower the tax rate and ceiling on the proposed hike, stating that they have made too many compromises as is. The joint paper suggested lowering the tax from three percent to two percent. The joint paper also mentioned expanding the price brackets indicated in the bill from four to seven. The brackets allow for a tax ceiling that depended on the car’s category. As well, the paper also included a request for a six-month lead time before the government implements its new tax rates. The groups behind the paper also sought to exclude coverage for alternative fuel, electric, and hybrid vehicles. Lopez said that the current version of HB 4774 is already modified and optimized . He adds that he already opposed an earlier version of the bill and requested the alteration of certain provisions. According to Lopez, the earlier version that the Department of Finance (DOF) submitted to Congress last year had a potentially negative impact on the output of the government’s Comprehensive Automotive Resurgence Strategy (CARS) program. The CARS program is an initiative meant to boost the local car manufacturing sector.