GREECE reached a deal with its European creditors on Monday that avoids an exit

from the euro and the global finan-cial chaos that prospect had raised. The deal calls for Greece, already reeling from harsh austerity mea-sures, to cut back even further in exchange for more loans, without which its financial system would surely collapse. French President François Hollande said the Greek par-liament would convene within hours to adopt the reforms called for in the plan, and he celebrated Greece’s continued membership in the euro. For the euro zone to have lost Greece, Hollande said, would have been to lose “the heart of our civilization.” The agreement came after months of often bitter negotia-tions and a summit that stretched from Sunday afternoon well into Monday morning. Greek Prime Minister Alexis Tsipras had been holding out for a better deal to sell to his reluctant legislature in Athens this week, even as financial

collapse grew closer by the day. A breakthrough came in a meet-ing between Tsipras, Hollande, Ger-man Chancellor Angela Merkel and European Union President Donald Tusk, after the threat of expulsion from the euro put intense pressure on Tsipras to swallow politically unpalatable austerity measures in exchange for the country’s third bailout in five years. “We took the responsibility of the decision to be able to avert the harshest outcome,” Tsipras said. “We managed to avert the demand to transfer Greek assets abroad, to avert the collapse of the banking system.”

The deal includes commit-ments from Tsipras to push a dras-tic austerity program, including pension, market and privatiza-tion reforms through parliament by Wednesday. In return, the 18 other euro-zone leaders commit-ted to start talks on a new bailout program that should stave off the imminent collapse of the Greek financial system.

www.businessmirror.com.ph n�Saturday 18, 2014 Vol. 10 No. 40 P. | | 7 DAYS A WEEKn�Tuesday, July 14, 2015 Vol. 10 No. 278

A broader look at today’s businessBusinessMirrorBusinessMirrorTHREETIME

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PESO EXCHANGE RATES n US 45.1540 n JAPAN 0.3679 n UK 70.0609 n HK 5.8256 n CHINA 7.2721 n SINGAPORE 33.4276 n AUSTRALIA 33.5169 n EU 50.3648 n SAUDI ARABIA 12.0404 Source: BSP (13 July 2015)

INSIDE

Life Tuesday, July 14, 2015 D1

Life BusinessMirror

Life •

DDEAR Lord, on a bit of humor, may we EAR Lord, on a bit of humor, may we EAR Lord, on a bit of humor, may we pray and sail a ship with You? We know that a ship is designed to take

us to places. May we ask You, Lord, to bless the friendship we have developed with many ship we have developed with many shippeople of different races. May You inspire the partnership we have formed with associates? ship we have formed with associates? shipMay You grant as we nurture our companionshipshiptogether with someone very special. May our relationship with others be strengthened by faith with others be strengthened by faith ship with others be strengthened by faith shipand grace. We pray for a ship that would carry us and grace. We pray for a ship that would carry us soon to Your abode. Amen!

A ship

YETTA L. CRUZ AND LOUIE M. LACSONYETTA L. CRUZ AND LOUIE M. LACSONWord&Life Publications • teacherlouie1965@yahoo.comteacherlouie1965@yahoo.com

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B B BChicago Tribune

FOR years, paint has been touted as the go-to way to freshen walls and ceilings affordably and quickly.

Wallpaper was typically typecast as a more expensive treatment because of the cost

to produce and purchase rolls. And it came with all sorts of caveats: Patience to hang and match patterns, coping with sometimes nasty adhesives, VOC inks and paints, and difficulty removing it without damaging walls. And it tended to age: Wallpaper that hung around awhile might start to tell a tale of outdated style—and tell it loudly.

But wallpaper’s making a big comeback, in part because enough time has elapsed from the late 1990s—and certainly its prior peak in the 1970s—when it generated buzz. Today’s over-arching trend is greater personalization, a direction that’s informing many other areas of design.

“When people buy wallpaper today, they’re less likely to walk into a showroom or store and buy rolls readily available,” says Sean Samet, executive director of the

Wallcoverings Association, the nonprofit, Chicago-based trade organization representing manufacturers and distributors. They’re also less likely to follow old rules—use no more than one pattern in the same space, or apply to all four walls.

“The reemergence of wallpaper is very much part of the trend of allowing people to tell their story through color and print,” says Charlotte Cosby, creative head of London-based Farrow & Ball.

Here are six other trends inspiring its resurgence:n Bolder colors. Colors have shifted from d ainty

pastels to more vibrant hues, such as blue, gold, orange and green reflecting. As part of the color boldness has come interest in metallic and other shiny papers. And neutrals, while not new, retain a hold, but often through stronger variations of what’s considered neutral such as grays, says Jack Ovadia, a designer whose Ovadia Design Group is based in New York.

n Bigger patterns. While you can still easily find sweet stripes and florals, the latest designs reflect larger scale and more hip inspiration, such as oversized, retro-inspired trellises and geometric chevrons, says Jason Lowe, director of design professionals for the Decoration & Design Building in New York. Flavor

Paper, a manufacturer based in Brooklyn, has licensed several Andy Warhol motifs, including his oversized florals, which transform the paper into art that attracts attention rather than simply serving as background, says company owner Jon Sherman. Natural materials are yet another muse, ranging from charred wood to rough stone and concrete. “People like the idea of taking a modern house without much charm and adding some grime and grit,” Sherman says.

n More tactile. Don’t think of wallpaper as just one-dimensional. Three dimensional designs incorporate everything from feathers to crystals, felt and powders, Samet says. Grass cloth has returned, but now it may be lacquered for a more novel look, Lowe says. Maya Romanoff’s papers, known for years for upping the ante in this way, also include such fanciful elements as seashells, glass beads and threads woven into hand-painted paper, to name a few possibilities.

n Photo real. Improvements in digital photography have helped inspire another trend—enlarging and repeating images with higher quality representation. Some wallpaper manufacturers secure their own photos; others license them from artists and other sources; and some use those sent in by designers or homeowners for highly personalized solutions. The end result is the same: a paper that nobody else may have, Samet says. Flavor Paper stepped into this niche with a selection of readily available images that can be sized to fit specific dimensions, or it will take buyers’ high-res digital images and turn them into full-scale wall murals.

n Novel placement. Wallpapers used to be installed primarily on four walls of a room, sometimes a ceiling. It’s also becoming commonplace to see papers on a single wall as a focal point, or even filling in as furnishings, such as a faux headboard installed behind a bed, Samet says. Cosby recommends papering the backs of cupboards or bookshelves and within the panels of doors as a nice touch.

n Technological advances. Best of all may be that wallpapers no longer need to be considered a choice for forever. Papers from Tempaper are made with a self-adhesive backing that makes installation and removal easy. The caveat with this New Jersey company’s product is that it needs to be installed atop well primed-and-painted walls. Designer Sayeh Pezeshki, founder of The Office Stylist, who likes Art.com as a resource, sees these removable papers as great options for renters, or folks like her, who “need to frequently update their space. To be able to wallpaper a wall or piece of furniture and just peel it off without damage is a design miracle,” she says. n

NEW design elements and a natural feel are some of the highlights of the newly renovated Kultura store at SM Megamall. This new look has strengthened its niche as a distinctive showcase of Filipino creativity and innovation, and as a source of everything uniquely Filipino.

The 1,157-square-meter store’s modern interiors and special lighting capture the philosophy of Kultura’s merchandise. A mix of metal and wood in natural, earth tones are used intermittently to achieve a natural feel. All these provide multiple textures that add charm and character to the store.

The natural elements of the store bring special attention to the merchandising, with new display setups and the emphasis of lighting at the store’s focal points. This way, items from different categories and collections—from Fashion, Home, Souvenir, Crafts for a Cause and Delicacies—are exquisitely enhanced.

At its new store, Kultura remains true to form in combining Filipino ingenuity with world-class materials and artisanal designs for a discriminating market. It is where traditional materials and contemporary fashion merge to create a contemporary Filipino look.

There is wide selection of modern and classic Filipiniana fashion, fashion accessories, as well as elegant collections that celebrate the National Gem—the South Sea Pearl. Here one can find uniquely Filipino home accessories, Filipino delicacies, and a souvenir section all in one shop.

Scheduled at Kultura’s new store in SM Megamall is the Jewelry Trunk Show from July 17 to 19, which showcases a wide range of elegant jewelry pieces that stand out with their premium quality and uniquely Filipino design.

WALLPAPERTHAT MAKES YOU SAY ‘WOW’WALLPAPERTHAT MAKES YOU SAY ‘WOW’WALLPAPER

WEITZNER Magnetism wallpaper turns walls into a memo board. ANTONIS ACHILLEOS SCHUMACHER’S Nest Collection Cascadia wallpaper in Peacock is made of real peacock feathers. SCHUMACHER

DESIGNTEXCharlie Harper Animals wallpaper features a pixelated rendition of the famous illustrator’s work. TODD OLDHA/

DESIGNTEX

The new lookfor Kultura

COLORFUL banig mats, pillow cases and other uniquely Filipino home banig mats, pillow cases and other uniquely Filipino home banigaccessories.

WOODEN wonders from carved photo frames to wood-burned bowls.

THE new Kultura store at SM Megamall features a warmer ambiance and specialized lighting to highlight the products.

BusinessMirror

World CompaniesTuesday, July 14, 2015 B2-3Editor: Dionisio L. Pelayo• corp@businessmirror.com.ph

THE merger creating the world’s largest airline is ex-pected to complete a key step

on October 17, when all flight res-ervations for US Airways are trans-ferred to the computer systems for American Airlines.

The airlines announced on Fri-day that, over a three-month period starting  July 17, all reservations made for US Airways flights will be gradually transferred to the Ameri-can Airlines system. The conversion is due to be completed by October 17.

When the transfer is complete, the US Airways web site will disap-pear and the last flight under the US Airways name will depart from San Francisco, landing in Philadelphia the morning of  Oct. 18. The two airlines have already merged their loyalty rewards programs.

Steps remaining in the merger, include the union of several labor

groups, the selection of a common uniform for all employees and the painting of US Airways planes with American Airlines logos and colors. That work is expected to be com-pleted by the end of 2016.

American Airlines officials said they chose to transfer reservations over three months to avoid techni-cal glitches that have plagued United Airlines since it merged with Conti-nental Airlines in 2012.

In the latest mishap to hit United, hundreds of flights were grounded for about two hours on Wednesday-because of a malfunctioning com-puter network router.

During a press call with report-ers, Maya Leibman, American’s chief information officer, said American’s reservation computers were designed with redundant sys-tems to reduce the chances of such failures. TNS

Now some companies are devis-ing ways to help people profit from their vehicles. Start-ups like Relay-Rides and Getaround help people rent out their cars during down time. Uber, Lyft and Sidecar con-nect car owners with people willing to pay for a ride. The rapid growth of these start-ups is transforming transportation—making it easier than ever before to get around with-out owning a car—and forcing au-tomakers to devise new strategies to lure prospective buyers.

In June Ford launched a car-sharing program that offers buy-ers a new way to offset the pains of ownership by tapping into what is essentially an Airbnb on wheels.

And in Germany, General Mo-tors launched a CarUnity app that lets owners of any brand rent their vehicles to Facebook friends or people in the app’s network.

“This is a big bang moment for the auto industry,” said Thilo Ko-slowski, vice president at research firm Gartner Inc., who estimates that by 2025, 20 percent of the vehicles in urban centers will be dedicated to shared use.

“Imagine all of a sudden 20 per-cent of your vehicles sales in the classic sense—to individuals who

will be the only user of that car—go away,” he said.

Each vehicle that goes into a full-time car-sharing service, such as short-time rental company Zipcar, supplants four to six new car sales and postpones the pur-chase of up to seven more, said Susan Shaheen, a transportation expert and professor of civil and environmental engineering at the University of California, Berkeley.

As people share vehicles, cars be-come “less sexy and more just trans-portation tools,” Koslowski said.

The ultimate effect on car sales is unclear. Population growth and a burgeoning middle class in devel-oping countries are creating new customers at a steady clip. But sales could take a serious hit if people decide it’s cheaper to forgo own-ing a car in favor of renting or ride sharing for the occasional errand.

Mark Fields, chief executive of Ford Motor Co., said the automaker needs to start “thinking like a mo-bility company,” as well as a manu-facturer.

In its six-month test program, Ford’s auto financing arm is invit-ing customers in six US cities—Berkeley; Oakland, California; San Francisco; Portland, Oregon;

Chicago; and Washington, DC—and London to sign up to rent out their vehicles for short-term use.

The San Francisco car-sharing company Getaround will manage the program by screening drivers, collecting funds and providing a $1-million insurance policy. Ge-taround suggests a rental rate based on the make, model and location of the vehicle, but owners can set their own prices.

Rates are typically $7 to $12 an hour, and include customer support and roadside assistance. Getaround takes a 40-percent cut.

In Bangalore, India, Ford is testing a fractional car owner-ship program with the car-sharing vendor Zoomcar. The companies have identified several three-per-son groups with complementary schedules, allowing each pod to share a single vehicle.

For some owners, the business can cover their car expenses.

Damien Breen, 38, rents his 2015 Audi A3 out 10 to 14 days a month, charging $59 a day through RelayRides. The Hollywood busi-nessman works out of his house and uses ride-share services Uber and Lyft to get around if the car is out.

“It pays for 100 percent of the ex-pense of my leased vehicle, includ-ing insurance, making it a free car for me to use two weeks a month,” Breen said.

Milliennials are leading the trend, looking for wheels to supple-ment an otherwise car-free life-style, researchers say.

“People below the age of 30 are much more likely to identify with their mobile and computing devices than the cars,” said Arun Sundara-rajan, a professor of information, operations and management sci-

ences at New York University. “Au-tos just aren’t the identity-making purchase that they once were.”

Many in the auto industry are skeptical that Americans are go-ing to fully embrace ditching their wheels and start subscribing to car-sharing services anytime in the near future.

“I believe that the American love affair with cars is alive and well,” said Scott Painter, chief executive of TrueCar, the online digital car pricing service. “I think we can grow the pie. I don’t think we will see a decline” in car sales.

One thing is certain: The com-petition will be fierce.

Shaheen, the UC Berkeley pro-fessor, said there are 23 car-shar-ing companies renting 19,115 ve-hicles to service about 1.3 million members in the US. The industry is growing at about 35 percent an-nually, she said. Her data include only companies such as Zipcar, which owns its fleet and rents cars by the hour.

Other companies such as Ge-taround, RelayRides and FlightCar allow people who own their own cars to make peer-to-peer rentals. Although there is overlap, each of the companies targets a slightly different market.

RelayRides, for example, re-quires a minimum full-day rental. FlightCar is airport-based. When people embark on a trip, they leave their car at the airport to be rented by a traveler to that city. Getaround is generally used for hourly access to vehicles.

But all have a common goal.“Our mission as a company is

to make cars less idle,” said Andre Haddad, chief executive of Relay-Rides. TNS

A NAHEIM, California—Anaheim Mayor Tom Tait entered battle this week in

a meditative mood, having helped the Dalai Lama celebrate his 80th birthday in the city.

Tait was doing something that few politicians have done in Or-ange County’s largest city: Pub-licly taking on Disneyland, the community’s biggest employer and tax generator.

At issue was a proposal pushed aggressively by Disney that would exempt the company if Anaheim ever imposed a gate tax on theme parks. Disneyland already has such an exemption, but the plan would extend it by at least 30 years.

In exchange, Disney has prom-ised to spend $1 billion on its Ana-heim parks, building new attrac-tions and a new 5,000-space park-ing lot. Construction is scheduled to start in 2017. If Disney spends an additional $500 million, the agreement would be extended to 45 years.

Many in the city supported the proposal and urged the city to act immediately.

But Tait remained wary, saying he strongly backs Disney, but does not want to deprive voters of their right to institute a new tax if they think it is necessary.

“This just shouldn’t happen,” Tait said during a marathon meet-ing on the proposal.

“I think, down the road, people will rue this day. Other people will look at us and say that we gave away the people’s right to vote.”

Despite the plea, the City Council voted 3 to 2 to grant the extension.

The debate in Anaheim offered a window into the delicate politics of challenging the “Happiest Place on Earth.”

The city has enjoyed a long and mostly prosperous relation-ship with Disney, through park expansions, the establishment of California Adventure in 2001, the opening of Cars Land in 2012 and the entertainment company’s foray into professional sports with the Ducks and the Angels.

Both of those new parks in-volved investments of around $1 billion in Anaheim and the city enthusiastically backed them. And by supporting Disney’s sports dreams, the city received a long-sought reward: Both teams had “Anaheim” added to their official names before Disney eventually sold them.

Today Disney remains a be-hemoth in the city. It employs around 28,000 people, and the city already receives a sizable portion of its tax revenue from the company. In 2014 $56 mil-lion came into the city’s general fund from Disneyland Resort, according to company officials. That represented a third of all taxes generated in Anaheim’s tourism district.

For some on the City Coun-cil, the extension of the exemp-tion is just one more step in this partnership.

“I think this will be remem-bered as a hallmark opportu-nity for economic development,” Councilman Kris Murray said.

Michael Colglazier, president of Disneyland Resort, echoed that view. “Anaheim has a leg-acy of city leaders who chose optimism—leaders who knew that the future could be one of growth and opportunity,” he told council members at the meeting. “And Disney has partnered with those leaders for over six decades to create a vibrant and enduring economic engine for the city.” Mayor Tait said his opposition focused in part on how fast offi-cials had moved on the bill. The measure was introduced nine days earlier, shortly before the Fourth of July holiday weekend.

“This is the people’s right to vote,” Tait said. “It’s ironic that we got nine days notice over the Fourth of July to look at this.”

Tait has served on the City Council for 20 years and was elected mayor in 2010. He owns an engineering and environmen-tal company.

He helped negotiate a similar deal with Disney in 1996, while working as a member of the Ana-heim City Council. At the meet-

ing on Wednesday, he said he re-gretted that decision. Anaheim does not currently have a gate tax. If voters decided to levy one in the future, the terms of the new agree-ment say that the city would have to reimburse the amount Disney pays in said tax.

Tait said the agreement ties the hands of voters. Despite ac-cusations that he wants a tax, he stressed that he does not support any new tax on the corporation.

He said he just does not like that voters do not have the abil-ity to put one in place if they wanted to.

“I don’t know of any other city that gives a company the veto over the vote of the people,” Tait saidThursday. “In that room you had special interests versus the people.”

Anaheim spokesman Mike Lyster said Disney reached out to the city in late May, saying it was mulling expansion plans worldwide. Throughout June the two sides discussed the proposed agreement before a public notice was issued on June 25.

The plan sparked a passionate debate in the city.

Norma Trujillo, a team man-ager in the workers’ compensa-tion department of Disney–and a longtime Anaheim resident–was grateful the exemption passed.

A single mother of two, she has worked at Disney since 2001 and said the company allowed her a more flexible schedule. Her daugh-ter also worked at the park during college and is now studying for her doctorate in molecular biology.

“Disney has always been very special to me,” Trujillo said. “I came out because I wanted to tell my story and how I relate to this issue.” TNS

PALO ALTO, California—Henry Ford put the world on wheels.

A century later, the company he founded is preparing for a world where congestion demands oth-er alternatives, including bikes, apps, public transportation and car sharing.

“It can make a material differ-ence in people’s lives by offering more choices and affordable and accessible mobility even if it is not a car,” said Ken Washington, Ford’s new head of research and advanced engineering.

Much of the work is happen-ing at the new Ford Research and Innovation Center that opened in Silicon Valley in January and already employs about 50 people tackling projects involving au-tonomous vehicles, connectivity and the use of big data.

When Ford opened the center in Palo Alto, it announced 25 global mobility experiments.

In San Francisco last week, Chief Executive Mark Fields said about 16 projects have concluded. Some completed their mission, some shifted their focus. Some have become pilot programs or progressed to the advanced engi-neering phase.

Here are some projects still in the works:

n Infocycle data gathering: Sen-sors attached to 12 bikes in Palo Alto and Dearborn, Michigan, gathered data on cycling patterns and conditions, creating a map of the city for cyclists, showing routes popular for offering shade or to be avoided because of pot-holes and poor lighting. Principal researcher Sudipto Aich is working on smaller, lighter sensor kits to put on 1,000 bikes by year-end. “Bikes are a great way to probe the city,” Aich said. “Bike companies are unlikely to do this research.”

n Electric-assist bikes: From a company-wide contest came three electric-assist bikes, the MoDe:Me personal commuter, MoDe:Flex enthusiast bike and the MoDe:Pro for commercial use like food deliv-ery. The motorized bikes fold and fit into Ford vehicles. The electric assist ensures you don’t get too

sweaty on the trip, can handle hills and safety cross busy inter-sections or roundabouts, said Tom Thompson, a powertrain engineer in the United Kingdom and one of the inventors. They all use an app that integrates driving, parking, public transportation and cycling into a seamless route. As a safety feature, the bike cannot operate without the owner’s smartphone.

n Car swapping, sharing, rent-ing: Ford announced the Peer-2-Peer Car Sharing pilot program for 14,000 Ford Credit customers in six US cities and 12,000 in London.

n Parking made easy: Parking is increasingly a problem, which led to a number of experiments that mine data to help drivers park and pay, and help cities understand parking patterns and needs, said Dave McCreadie, who works on electric vehicle infrastructure and the smart grid. “Parking spotter” uses sensors on cars to find spots and feed the data to a cloud-based system. Another project produced the “painless parking” app that tells you if the spot you find is le-gal—cities like London change the rules for spots over the course of the day—while offering a seamless way to pay for it. A third experi-ment looks at using the cellular network to drive a car by remote control. This virtual valet would drop you off and park itself at an affordable lot farther away.

n Driving-score data: Over 90 percent of people think they are good drivers, Fields said. Data collection helps provide drivers with a score that can be used to decide whether to share your car. Or customers could get better rates if they have better driving scores.

n Wearables: Dave Hatton, global product manager, is work-ing on an update of the MyFord mobile app for release this summer to be used with the smartwatch to monitor a Ford electric vehicle.

Apple or Android watches can use the app to check charge sta-tus, look for available charging stations, trip info, start your car remotely, check tire pressure and alert you to move your fully charged car so you don’t pay a pen-alty for overstaying. TNS

American Airlines, US Airways settarget to merge reservation systems Ride sharing forces automakers

to rethink how they sell cars

Anaheim mayor willing to take on Disney

LOS ANGELES—For at least 22 hours a day, most cars sit parked, sucking up their owners’ money

while waiting to be driven. For most people, it’s one of their most underuti-lized—but most expensive—assets.

Ford of the future: Wearables, car swapping, e-bikes, apps

Sports

‘THE ONE’AND THE OTHER THREE

SportsSportsBusinessMirrorSports

THAT ELUSIVE NO. 8

ROGER FEDERER: Thankfully, I’ve won here in the past, so it does not feel like I’m chasing anything. AP

championships atWimbledon put him even with Pete Sampras and 1880s player William Renshaw at the top of the list.

It’ll take another 52 weeks to get another shot at that record.“That’s why this defeat hurts more,” the 33-year-old Federer said. “You know you have

to wait another year and win six matches. It’s a long way off.”Heading into the final, Federer had been superb. Through six matches at the All

England Club, including a straight-set victory over Andy Murray in the semifinals, Federer’s serve had been broken only once.

And despite the break in the first set against Djokovic that erased his early lead, Federer was looking stellar again through two sets.

“He played amazing tennis throughout the entire tournament. He deserved to be there,” said Djokovic, who beat Federer in five sets in last year’s final. “I knew that he’s not going to drop his level too much. He’s going to make me earn every point. “He’s not going to lose, I’m going to have to win if I want to lift that trophy.” Djokovic did what he needed to in the third set, breaking Federer in the third game after saving a break point in the previous game. And then, with Djokovic up a break and leading

3-2, the rain came and the match was briefly suspended. The roof, however, stayed open when play resumed. In 2012 Federer and Murray

were playing a tight match in the final until the roof was closed. That’s when Federer completely took over and won his seventh title. Not this time. “I think maybe the rain came at a bad time for me. Maybe if it came earlier or much later, it would have been better,” Federer said. “The way it was, I couldn’t take advantage of it, even though I had a [15-30] game shortly after I came back.” In the fourth set, Djokovic again played better on the big points, breaking

Federer twice for the win and his third Wimbledon title. “It would have been nicer to win some than to lose some,” Federer said. “At

the same time, I lost against the world No. 1 at the moment. That’s the kind of guy you probably can lose against.”

Sports

‘THE ONE’AND THE OTHER THREE

C1 | TUESDAY, JULY 14, 2015ULY 14, 2015ULY

mirror_sports@yahoo.com.phsports@businessmirror.com.phEditor: Jun Lomibao

THAT ELUSIVE NO. 8LONDON—Roger Federer was a match away from fulfilling his mission of winning a

record eighth Wimbledon title. Once again, he ran into a seemingly invincible Novak Djokovic.

Federer had been in excellent form throughout this year’s tournament, and he continued to show it in Sunday’s final. He took an early lead in the first set, he came back to win an epic 22-point tiebreaker in the second set, and he matched Djokovic all afternoon with sizzling forehands and slick backhands on the grass of Centre Court.

Still, No. 8 remains elusive.“For me, a finalist trophy is not the same. Everybody knows that,” Federer said after

his 7-6 (1), 6-7 (10), 6-4, 6-3 loss. “Thankfully, I’ve won here in the past, so it does not feel like I’m chasing anything.”

Federer has already made history on the tennis courts, several times. His 17 major titles are the most any man has ever won, and his seven

SUNDAY’S victory takes place on Novak Djokovic’s first wedding anniversary. AP

championships atWimbledon put him even with Pete Sampras and 1880s player William Renshaw at the top of the list.

It’ll take another 52 weeks to get another shot at that record.“That’s why this defeat hurts more,” the 33-year-old Federer said. “You know you have

to wait another year and win six matches. It’s a long way off.”Heading into the final, Federer had been superb. Through six matches at the All

England Club, including a straight-set victory over Andy Murray in the semifinals, Federer’s serve had been broken only once.

And despite the break in the first set against Djokovic that erased his early lead, Federer was looking stellar again through two sets.

“He played amazing tennis throughout the entire tournament. He deserved to be there,” said Djokovic, who beat Federer in five sets in last year’s final. “I knew that he’s not going to drop his level too much. He’s going to make me earn every point. “He’s not going to lose, I’m going to have to win if I want to lift that trophy.” Djokovic did what he needed to in the third set, breaking Federer in the third game after saving a break point in the previous game. And then, with Djokovic up a break and leading

3-2, the rain came and the match was briefly suspended. The roof, however, stayed open when play resumed. In 2012 Federer and Murray

were playing a tight match in the final until the roof was closed. That’s when Federer completely took over and won his seventh title. Not this time. “I think maybe the rain came at a bad time for me. Maybe if it came earlier or much later, it would have been better,” Federer said. “The way it was, I couldn’t take advantage of it, even though I had a [15-30] game shortly after I came back.” In the fourth set, Djokovic again played better on the big points, breaking

Federer twice for the win and his third Wimbledon title. “It would have been nicer to win some than to lose some,” Federer said. “At

the same time, I lost against the world No. 1 at the moment. That’s the kind of guy you probably can lose against.”

B B DLos Angeles Times

L ONDON—It is increasingly obvious that Father Time is not messing with Roger Federer. Novak Djokovic is. In the aftermath of Djokovic’s

7-6 (1), 6-7 (10), 6-4, 6-3 victory in the Wimbledon men’s final here Sunday, much will be written about how old Federer is. Instead, much should be written about how good Djokovic has become. Federer will be 34 on August 8. He has won 17 major titles, most by any men’s player, but none since Wimbledon 2012. So the critics line up with wheelchairs. He remains the second-best player in the world. His No. 2 ranking says that. So do his results this year. He’s won four titles and was 40-6 coming into Sunday’s match. Rest-home applications will have to wait. “I’m right there. My game is good,” he said afterward. “I played on my terms. Things are all right.” Actually, things would be a lot better for Federer if Djokovic weren’t around. At one time, he was a solid part of the Big Four of men’s tennis—along with Federer, Andy Murray and Rafael

Nadal. Suddenly, it is beginning to look like there is The One and The

Other Three. This was Djokovic’s

second straight Wimbledon title, his third overall, and second straight Wimbledon title, his third overall, and second straight over Federer in the final. It was his second straight over Federer in the final. It was his ninth Grand Slam title, which puts him one behind ninth Grand Slam title, which puts him one behind Bill Tilden and one ahead of some legendary names: Bill Tilden and one ahead of some legendary names: Andre Agassi, Ken Rosewall, Fred Perry, Ivan Lendl and Andre Agassi, Ken Rosewall, Fred Perry, Ivan Lendl and Jimmy Connors.

Federer was asked afterward about where he thought Federer was asked afterward about where he thought Djokovic’s tennis legacy stood at the moment.Djokovic’s tennis legacy stood at the moment.

“Moving up,” he said.Had he not lost the French Open final to Stan Had he not lost the French Open final to Stan

Wawrinka, Djokovic, 28, would be heading to New Wawrinka, Djokovic, 28, would be heading to New York and the US Open with the same goal as Serena York and the US Open with the same goal as Serena Williams—a calendar-year Grand Slam. In January he Williams—a calendar-year Grand Slam. In January he won his fifth Australian Open.

Sunday’s victory took place on his first wedding Sunday’s victory took place on his first wedding anniversary.

“Ever since I got married, and became a father,” “Ever since I got married, and became a father,” he said, “I haven’t lost many matches, I won many he said, “I haven’t lost many matches, I won many tournaments. I suggest that to every player. Get married, tournaments. I suggest that to every player. Get married, have kids, enjoy this.”

That will work, as long as you add an incredible That will work, as long as you add an incredible baseline and service-return game that neither Federer baseline and service-return game that neither Federer nor anyone else on the tour can seem to counteract.nor anyone else on the tour can seem to counteract.

Djokovic won the first set after being down a break Djokovic won the first set after being down a break and then engaging Federer in baseline rallies in the and then engaging Federer in baseline rallies in the tiebreaker. Federer is sensational off the ground. Djokovic tiebreaker. Federer is sensational off the ground. Djokovic is better. He can bend, stretch, run and reach better than is better. He can bend, stretch, run and reach better than anyone in the game. He is the sport’s Gumby. If Federer’s anyone in the game. He is the sport’s Gumby. If Federer’s ground strokes were landing three 3 from the baseline, ground strokes were landing three 3 from the baseline, Djokovic’s were two 2 closer to it.

He can, and does, produce angles with his two-He can, and does, produce angles with his two-handed backhand that appear impossible. In his next handed backhand that appear impossible. In his next life, he will star in Cirque du Soleil. He gets to the ball life, he will star in Cirque du Soleil. He gets to the ball faster and hits it deeper and harder than anybody in faster and hits it deeper and harder than anybody in the game.

Federer, to his credit—and with ultimate net-rusher Federer, to his credit—and with ultimate net-rusher Stefan Edberg in his coaching box—did his best not to Stefan Edberg in his coaching box—did his best not to get involved in trading baseline shots. He served and get involved in trading baseline shots. He served and volleyed 32 times, Djokovic zero. He approached off a volleyed 32 times, Djokovic zero. He approached off a ground stroke 58 times, Djokovic 34. Federer had 58 ground stroke 58 times, Djokovic 34. Federer had 58 winners, 25 of them at the net. Djokovic won 72 points winners, 25 of them at the net. Djokovic won 72 points from the baseline, Federer 50.

Statistics will be far less remembered by the packed Statistics will be far less remembered by the packed house of 15,000 at Centre Court, where the fans love house of 15,000 at Centre Court, where the fans love Federer and his seven titles here, and were sent into a Federer and his seven titles here, and were sent into a frenzy in the second-set tiebreaker.frenzy in the second-set tiebreaker.

Djokovic got it to 6-3 and Federer saved all three set points. Then he saved four more while losing one himself at 8-7. Finally, Federer served and volleyed successfully at 11-10 and the place shook. Djokovic whacked at the bottom of his shoes with his racket, as if bad traction were the culprit.

“Very frustrating on the changeover,” Djokovic said, “[because] I knew I cannot let this happen against Roger in the finals of Wimbledon....”

Hardly. The second set took 65 minutes. The next two would take a total of 66.

When Federer missed a sitter at the net to be broken and go down, 1-2, in the third set, the end was in sight. On his first set point at 5-4, Djokovic closed it out with a routine overhead.

Djokovic’s service break again came early in the fourth set, and was yet another confirmation of what Richard Gasquet said of Djokovic’s game after losing to him in the semifinals.

“Returns, returns,” he said. “You serve and there is the ball, back on your side of the net.”

With Federer serving at 2-2, Djokovic took a deep first serve and returned it off the chalk on the baseline. Federer, caught flat-footed, could only try to flick it back, and it went into the net.

On his first match point, Djokovic hit a massive inside-out forehand that Federer couldn’t touch. He threw his hands into the air, pounded his chest, pointed to his coach, Boris Becker, and his team box and eventually knelt on the grass, picked a piece and chewed it. He said that was something he envisioned himself doing when he dreamed of winning Wimbledon as a youngster.

“It’s gluten free,” he said.Another title by Federer would have been a record eighth

here. He and Pete Sampras remain tied for now at seven.Djokovic won about $3 million (depending on the

British pound’s conversion rate). Federer had to make do with about $1.5 million.

But that financial shortfall wasn’t the worst news for the Swiss tennis legend. That came in Djokovic’s post-match news conference.

“I’m 28,” he said. “I feel good. I don’t feel old. I have, hopefully, many more years in front of me. I’m going to try to push my own limits and see how far I can really go with titles, and with myself playing in this high level.”

Sorry, Roger.

In the aftermathof Novak Djokovic’s 7-6 (1), 6-7 (10), 6-4, 6-3 victoryin the Wimbledon men’s final on Sunday, much will be written about how old Roger Federer is. Instead, much should be written abouthow good Djokovic has become.

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DOJ-OFC: Imposition of SRP has to stop‘DE FACTO’ PRICE CONTROL RESTRICTS COMPETITION AND HURTS FILIPINO CONSUMERS IN THE END

In a 23-page report issued by the DOJ-Office for Competition (OFC), headed by Justice Assis-tant Secretary Geronimo L. Sy, the agency said there are no adequate rules or guidelines covering the im-position of SRP.

It noted that there is no pre-scribed period, process, stan-dards, bases or conditions to guide an agency in determining SRP and defining reasonable price increase or decrease that is acceptable to the agency.  “The study finds that, while public welfare justifies govern-ment intervention against deceit-ful business practices, the misap-plication of the SRP creates unin-

tended consequences. As a form of price-regulating mechanism by some government agencies, the SRP amounts to undue interference in the market and restricts competi-tion,” the DOJ-OFC said.  It added that, in the case of the Department of Trade and Industry (DTI), there is an enforcement pro-cedure against noncompliance with SRP, such as the 30-day advance notice to the agency to increase prices, denial or modification of the proposed price increase and the is-suance of a notice to explain that is served to business establishments with prices above the government-recommended rates.

C A

Greece reaches deal with EUcreditors to avoid euro exit

B J R. S J

THE Department of Justice (DOJ) on Monday called on concerned government agencies to review

their policy of imposing “suggested retail price” (SRP),  as “it restricts competition and improvement in the quality of products, to the detriment of the buying public.”

C A

THE FEARED POWER SHORTAGE:

WHY IT DID NOT HAPPEN

B L L

Second of three parts

IT has been a year now since the looming power crisis was sounded off and yet not a single brown-out due to supply shortage occurred in Luzon.

As it turned out, an old pump-storage power fa-cility in Laguna proved to still be useful. While the debate on emergency powers went on, the Senate—Sen. Sergio Osmeña III in particular—wanted the 727-megawatt (MW) Caliraya-Botocan-Kalayaan (CBK) to run at its full capacity. Due to line constraints and other issues, the CBK is only able to deliver around 300 MW. “I personally went there to ask why CBK is not running at its full capacity. The answer I got was because, aside from the transmission line, the re-sorts nearby would complain if water level would rise. So we talked to the resort owners and owners of small houses there, and told them they will be compensated if they will relocate. CBK was cre-ated as a pump storage and not as a resort lake,” Osmeña said.

Likewise, the line constraint was addressed. “The NGCP [National Grid Corp. of the Philippines] has energized the Lumban line. So CBK will now give us 720 MW, not only for three months in summer but forever,” Osmeña said.

CBK to the rescueTHE Senate pushed for the declaration of the CBK plants as “must-run units” during peak hours to

achieve the desired water elevation of the Cali-raya Lake and optimize the existing output of the said units.

It urged the Department of Energy (DOE) to declare all CBK pump-storage power plant units as “must-load units” from 8 p.m. to 8 a.m. from Mon-day to Saturday, and even on Sunday, if and when requested by the Power Sector Assets and Liabilities Management Corp. (PSALM); and as must-run units during peak period hours to achieve the desired wa-ter elevation of the Caliraya Lake and optimize the existing output of the said units. PSALM is the agency mandated by Republic Act 9136, or the Electric Power Industry Reform Act (Epira) of 2001, to handle the sale of the remaining state power assets and financial obligations of the National Power Corp. (Napocor).

Napocor President Gladys Cruz-Sta. Maria said her office also played an important role in running the CBK at its full capacity. In an interview, she said there was a study con-ducted by Napocor to optimize CBK’s operation. “I think the study initiated by Napocor was instrumen-tal to averting the projected power-supply deficiency in Luzon,” she commented.

“Napocor, in coordination with the DOE and the office of Senator Osmeña, implemented in-creasing the water elevation of Caliraya Lake to 288.5 meters above sea level [masl]. Historically, the maximum elevation was only at 287.1 masl,” Sta. Maria said.

SPECIAL REPORT

AN elementary student from Tinajeros, Malabon, is forced to work on her assignment by candlelight as electricity in their house was cut off due to nonpayment of bills. KEVIN DE LA CRUZ

news@businessmirror.com.ph BusinessMirrorTuesday, July 14, 2015 A2

BMReportsContinued from A1

The feared power shortage: Why it did not happen She further said the increased elevation prepared Kalayaan for dis-patch at 720 MW for six hours a day, Mondays to Fridays. “This precluded declaration of yellow or red alerts, in-cluding brownouts, which could have otherwise occurred with Kalayaan on status quo. This effectively provided additional capacity of 400 MW on top of the usual 320 MW.”  Moreover, the Napocor official said her office was on top of the relocation of informal settlers that could have been affected by the water elevation. CBK, however, is up for privatiza-tion next year. Before former Energy Secretary Carlos Jericho L. Petilla stepped down as energy chief, he asked PSALM to hold off the auc-tion. Petilla strongly believes that the CBK should remain as a regu-lating power reserve. “I feel that it should not be priva-tized because it is the only asset left in this  country that serves as regu-lating reserve. It’s the best defense

this country has to regulate the grid,” Petilla said. In earlier presentations PSALM intends to privatize the CBK hydro-power facility in the second half of 2016. Likewise, the state firm has set the indicative turnover of the administrator of the CBK contracts by the first semester of 2017. If Petilla, who also served as vice chairman of the PSALM board, would have his way, he said, “I would defer” the auction. He said it was because of CBK that Luzon was able to avert a power outage. “We did not have brownouts because of that. CBK remains the only regulating asset in this country [and] that its main use is for security,” Petilla added. When sought for comment, PSALM Officer in Charge Lourdes Alzona said Kalayaan of the CBK plant complex acts both as regulat-ing and contingency reserve. There is no board approval yet if the auc-tion will proceed. “As to the privatization of the CBK, we defer to our board. All

privatization terms and conditions are subject to board approval. Target privatization for CBK is still 2016. It is not yet in the agenda of board meetings in the coming months,” she said in an interview. Cooler summerANOTHEr reason Luzon was spared from brownouts was because of manageable demand for electric-ity, mainly on account of cooler tem-perature last summer. “This is the only summer I can remember that it was still raining in March and there’s a typhoon in April. Basically, it is unusual. This is good because our hydropower plants are not getting dried up. They are sup-posed to dry up during summer.  The temperature is also not that high, so demand is not yet at its very peak,” the resigned energy chief said. Based on the DOE’s weekly fore-cast, Petilla said there is “plenty of reserve now.” “We are still going to be okay at this point. The hydropower plants are performing well. We have

a good weather. All these things are coming into play,” he added. DOE Officer in Charge Zenaida Monsada said current power sup-ply is able to meet the demand. “We hope that there will be no unsched-uled shutdown of power plants because that will have an impact on our reserves. We have enough supply and reserves, provided that no power plants conk out all at the same time,” Monsada said when sought for comment. The top officials of Napocor and PSALM both agreed that the DOE played a very important role in avert-ing a power crisis. “Apart from the weather con-dition that led to a peak demand lower than the projection, several measures were implemented by all sectors in the industry. The DOE played a vital role in coordinating the government’s initiatives to stabilize power supply, as well as the support of the legislators,” Alzona said. Sta. Maria, for her part, said the demand side management, vigor-

ously campaigned by the DOE, helped reduce the actual peak de-mand during the summer months, as well as reduce forced outages of major facilities. “For this reason, it was not necessary to tap the Inter-ruptible Load Program prepared by the distribution utilities and electric cooperatives.” Effective campaignTHE DOE also launched a cam-paign to encourage the public to conserve energy. The “Energy Sense, Saves Cents” campaign is aimed at promoting en-ergy conservation in residential and commercial areas. The DOE launched a series of TV, radio and print com-mercials highlighting the campaign. In one of the commercials, Petilla promotes that putting the thermo-stat of cooling systems to 25 degrees Celsius would not only save on costs, but also eases demand for electricity.  “Everybody cooperated. We were able to make people conscious of their energy consumption. People

are cooperating by saving power. CBK, of course, was very helpful. It also helped that there was an early warning of what may happen in summer, which, fortunately, did not happen. But most important, the consumers cooperated as demand was manageable,” Petilla said. Energy Utilization Management Bureau Director Patrick Aquino said each household can really save on energy. “We are highlighting things that each household can do to be more efficient in their energy use... apart from making our household appliances more efficient, is our quest for savings,” he said. To date the DOE continues to spread awareness on the importance of energy efficiency through com-mon examples that citizens can ap-ply quickly in their homes and even share to others, Aquino said. Additional tips and more informa-tion are available at the wattmatters.org.ph web site—the DOE web site for energy efficiency and conservation—the DOE also said. To be continued

Greece reaches deal with EU creditors to avoid euro exit. . . Continued from A1

A Cypriot official said the credi-tors would look into bridge-financ-ing for Greece later Monday, sug-gesting that the political decision could pave the way for the European Central Bank to extend emergency liquidity assistance to Greek banks. Without it, they risk running out of cash this week. The official spoke only on condition of anonymity

because he was not authorized to discuss the deal publicly. If the talks had failed, Greece could have faced bankruptcy and a possible exit from the euro, the European single currency that the country has been a part of since 2002. No country has ever left the joint currency, which launched in 1999, and there is no mechanism

in place for one to do so. Greece had requested a three-year, €53.5-billion ($59.5-billion) financial package, but that number grew larger by tens of billions as the negotiations dragged on and the leaders calculated how much Greece will need to stay solvent. A discussion paper put to euro zone leaders on Sunday and obtained

by the Associated Press spoke of a po-tential “timeout from the euro area” for Greece if no agreement could be found. Greece has received two previous bailouts, totaling €240 billion ($268 billion), in return for deep spending cuts, tax increases and reforms from successive governments. Although the country’s annual

budget deficit has come down dra-matically, Greece’s debt burden has increased as the economy has shrunk by a quarter. The Greek government has made getting some form of debt relief a priority, and hopes that a comprehensive solution will in-volve European creditors at least agreeing to delayed repayments

or lower interest rates. Greek debt stands at around €320 billion ($357 billion), a stag-gering 180 percent or so of the country’s annual gross domestic product. Few economists think that debt will ever be fully repaid. Last week the International Mon-etary Fund said Greece’s debt will need to be restructured. AP

briefsespina bids good-bye

DEPUTY Director General Leonardo Espina, National Police officer in charge (OIC), called on members of the police force on Monday to support his successor upon his retirement before the weekend. Espina, however, did not identify his successor, but reports said that two of the contenders to lead the 155,000-strong force are Deputy Director General Danilo Constantino, chief of the directorial staff, and the directorate for operations chief, Director Ricardo Marquez. In his brief message, Espina thanked the National Police officers corps and rank and file for their support during his seven months as OIC. “I will be retiring on Thursday. I will be handing over the command leadership to the next National Police chief. Tuloy-tuloy ang ating trabaho at serbisyo,” Espina concluded. Rene Acosta

By Joel R. San Juan

THE bid of Aquino administra-tion supporters to have Vice President Jejomar C. Binay

impeached over the alleged overpric-ing of several projects in Makati City has no leg to stand on. This was the opinion of lawyers Tranquil Salvador, a defense lawyer in the impeachment case against former Chief Justice Renato Corona in 2012, and former Integrated Bar of the Philippines National President Vicente Joyas. Salvador and Joyas stressed that the alleged illegal acts were commit-ted when he was still the Makati City mayor, thus, cannot be used as a valid ground to impeach Binay. “I don’t think the overpricing charges can be used to impeach Binay as vice president. It should be grounds arising out of, or in connection with, his present office,” Salvador said. Joyas, on the other hand, said the charges connected to the supposed overpricing of several government buildings in Makati City does not even fall under the grounds for impeachment. “The grounds for impeachment are betrayal of public trust and cul-pable violation of the Constitution, among others,” Joyas pointed out. “That [charge over Makati over-pricing deals] is not betrayal of public trust because he was reelected sev-eral times and the reelection and election of his son, daughters and wife negated whatever betrayal may be alluded to,” Joyas said.

news@businessmirror.com.ph Editor: Dionisio L. Pelayo • Tuesday, July 14, 2015 A3BusinessMirrorThe Nation

police outposts at petron stationsPETRON Corp. has partnered with the National Police to establish police outposts in 10 selected stations along major roads and highways for increased police visibility and crime-prevention awareness. The partnership, dubbed “Lakbay Ligtas,” is a first-of-its-kind partnership that enables police to immediately respond to emergencies through a dedicated patrol area in key Petron service stations in Mega Manila. A memorandum of agreement (MOA) was recently signed between the two. The MOA also coincides with the police’s Community Relations Month. These outposts will be manned by policemen a few hours daily and will be also be used by the police when attending to complaints and other concerns. Morever, these will be used for posting and distribution of crime-prevention leaflets, as well as drop-off points for relief goods during calamities. Lenie Lectura

manila dad hits nhc officialsMANILA Councilor DJ Bagatsing on Monday called for the resignation of the National Historical Commission’s (NHC) top officials for having signed the original permit to construct the 49-story-high Torre de Manila. Maria Serena I. Diokno is the chairman, while Ludovico D. Badoy is the executive director of the NHC. “We have a copy of the permit that the NHC gave to DMCI to proceed with the construction,” Bagatsing said. He said Torre de Manila’s construction started in 2012 and was first opposed by Carlos Celdran, a Filipino tour guide and cultural activist. The National Commission for Culture and the Arts and various critics are calling for the demolition of Torre de Manila for having marred the previously unobstructed background of the Rizal Monument at the Luneta. Recto Mercene

‘Impeach Binay move has no leg to stand on’

lacierda denies misuse of govtfunds to boost roxas campaign

Palace Spokesman Edwin Lacier-da issued the clarification after for-mer Sen. Panfilo Lacson questioned the huge 2015 allocations placed under the disposal of  Department of the Interior and Local Government (DILG) headed by Roxas, including the P1.2-billion housing budget and P3.1 billion in local projects, said to include roads and bridges, or a total of P4.3 billion. “ The 2015 budget is there [for all to see] in the Official Ga-zette,” Lacierda said, adding that the huge allocations reportedly placed under Roxas disposal fall under the so-called special provi-sions of the 2015 General Appro-priations Act (GAA). In a Palace briefing on Monday, Lacierda explained at length the justification for putting P1.2-billion housing budget under the Roxas-

led DILG, say-ing it included funding for the government’s housing pro-gram to relo-cate Informal Settler Families (ISF) residing in danger zones.

“Let me just go first to the

housing,” he said, then proceeded to quote from the GAA. “Housing program for ISF—the one-point-something billion amount that you mentioned is in Special Provision 5: Housing Program for Informal Settler Families Residing in Danger Areas within Metro Manila. ‘The amount of P1,244,606,000 appropri-ated herein for the Housing Program for ISF Residing in Danger Areas

MALACAÑANG on Monday denied misallocating billions of pesos of  government funds

provided in the 2015 national budget to boost the presidential bid of Interior Secretary Manuel Roxas II, presumptive standard bearer of the ruling Liberal Party in the 2016 elections.

within Metro Manila shall be used exclusively for the following projects with the corresponding amounts: a) Construction of Micro-Medium-Rise Buildings P700 million; b) Interim Shelter Fund for 26,367 Target Fami-lies P474,606,000; c) Administrative Cost P70 million.” Lacierda said this was the pro-vision being questioned by Lacson. “So, ito po iyong sinasabi dito na iyong budget sa housing ni Sen. Ping Lac-son. Ito ang nasa ISF. Remember there was a situation before where the informal settler families were situated in danger zones, iyong mga nasa creek, nasa river.” Lacierda pointed to President Aquino as one who approved the huge funding, saying, “So the Presi-dent made emphasis on the point that this is not acceptable for them and this is not acceptable for this government to put them [ISF] al-ways in harm’s way. Every time that there’s a storm, every time that there’s a flood, these people are put in harm’s way, so we have to take them out of these danger zones. And for that particular instruction, [Budget] Secretary Florencio B. Abad provided a budget for that. Nandoon po iyan sa budget.” Lacierda then proceeded to ex-plain the bigger P3.1-billion alloca-tion for local projects in so-called conflict areas identified by the Of-fice of the Presidential Adviser on the Peace Process but placed under the Roxas-led DILG.

By Butch Fernandez

roxas

BusinessMirror news@businessmirror.com.ph A4

Economy

The Trade Union Congress of the Philip-pines (TUCP) has lauded the local govern-ments of Quezon City and Makati City

for their efforts in promoting small-scale vermi-culture as a means to provide a new livelihood opportunity for the unemployed, including idle housewives and persons with disabilities (PWDs). TUCP President ernesto herrera, in a news statement, said public investments in vermicul-ture will provide supplemental income to mar-ginal households. “The facility has helped in a big way to raise public awareness of vermiculture, and the fact that there’s good money to be made in cultivating earthworms in urban settings,” herrera said. “Vermiculture works even in slums. The ac-tivity requires little space or maintenance. It is fairly easy and can be done by anybody—even by PWDs—at home,” he added. Vermiculture refers to the growing of earth-worms in containers. It has two high-value prod-ucts: earthworms that sell for around P1,000 per kilo, and vermicompost that fetches roughly P800 per 50-kilo sack, according to the earth-worm Sanctuary, which has been providing free training to would-be vermiculturists. Buyers of earthworms and vermicompost in the city setting include commercial growers of decorative plants and flowers, the ornamental fish sector and other worm breeders. herrera, citing a Department of Budget and

Management report on “grassroots participa-tory budgeting,” said organic-fertilizer produc-tion using earthworms and urban gardening are now regarded as poverty-reduction strategies by many local governments in Metro Manila. “Growing earthworms can be quite gain-ful, considering that a kilo of live worms can easily multiply into 32 kilos within a month,” said herrera, former chairman of the Senate Committee on Labor, employment and human Resources Development. Also called nature’s best organic fertilizer, vermicompost is the black, earthy-smelling, nutrient-rich humus generated by earthworms, after they consume and “recycle” kitchen or food waste, or decaying yard litter. Commercial gardeners of ornamental plants and flowers prefer vermicompost, which is more potent, environment-friendly and also cheaper compared to chemical fertilizers that cost any-where from P1,800 to P2,500 per 50-kilo sack, herrera said. “Ideally, local governments should be pro-moting vermiculture alongside the backyard growing of ornamental plants and flowers, or even the container gardening of high-value vegetables to supplement household food con-sumption, especially now that [food] prices have skyrocketed,” he said. As economic activities, herrera said vermi-culture and urban gardening actually reinforce each other. Jovee Marie N. dela Cruz

By Jovee Marie N. dela Cruz

AnAT IonA L consumer- rights group on Monday filed a graft case and ad-

ministrative charges before the

office of the ombudsman against members of the Bids and Awards Committee (BAC) of the Light Rail Transit Authority (LRTA) for “fa-voring” a prospective new mainte-nance service provider of the Light

Railway Transit 2 (LRT 2) line that runs from Recto to Santolan. In an eight-page complaint, the national Coalition of Filipino Con-sumers (nCFC), represented by its legal counsel and spokesman law-

yer oliver San Antonio, questioned the one-sided treatment of the pro-ceedings surrounding the tender of services for the maintenance of the 15-year-old rail-transport system and filed criminal and administra-

tive cases against BAC C h a i r m a n Jose Jobel Belarm-ino, BAC members A mador Ca lado Jr., Wilfredo Al-day, Jesus Jimen-ez, nestro Flores, Anita Lomboya, Joseph hagos and Adelo Jandayan, the head of the BAC Secretariat Alwin-ston C. Pillos and secretariat member Michael Cueto. The complainant alleged that the BAC and secretariat members violated the Anti-Graft and Corrupt Practices Act and the Gov-ernment Procure-ment Reform Act

when they reopened the period for accepting bids after already having closed the bidding. “At 9 a.m. on April 22, 2015, the LRT-BAC declared the submission of bids closed, pursuant to the deadline for submission of bids set forth in the ITB [invitation to bid]. however, at around 9:03 a.m., or some three min-utes after the deadline set in the ITB and the actual closure of acceptance of bids, Busan-eDC JV [joint venture] still submitted its bid documents...the BAC reopened the acceptance of bids and accepted the late submission of Busan,” the group alleged. The group added that the reopen-ing of the bids was, likewise, made despite proper and timely objection from the other bidder APT-CB&T-MRAIL JV representative. “The above persons all acted in conspiracy in violation of the above cited laws, thus further adding to the present transportation woes being suffered every day by the Filipino people,” the group said. It added that the BAC accepted the bid submission of the Busan-eDC JV “despite clear and undis-puted noncompliance with the pack-

ing and sealing instructions.” Moreover, the complainant said the BAC declared Busan’s tender as compliant with the requirements on Translated Foreign Documents even if the submission was “clearly wanting in describing the docu-ments as an accurate translation of a foreign document.” “There’s no reason the BAC would allow deviation and noncompliance with procurement rules. Is it because there’s urgent need to project an image of speed and perception of responsiveness to the public’s eve-ryday transport woes? That’s highly doubtful. Most likely, this is another case of the government favoring a contractor, to the detriment of the Filipino commuter,” San Anto-nio said. “We filed these graft [and admin-istrative] cases to inform the general public that these anomalous transac-tions happen and, of course, to make erring public officials criminally and administratively answerable to the law. Corruption is neither advantageous to the government nor to the Filipino peo-ple. It’s only advantageous to the people who commit them,” he said.

Smartmatic-TIM was earlier declared as having the lowest calculated responsive bid for the lease with option to purchase of the oMR machines. The SBAC 1’s recommendation was made after Smartmatic-TIM passed the postqualification evalu-ation where all the documents and statements submitted were verified and validated “In view thereof, the SBAC 1

resolves to recommend to the head of the procuring entity the issu-ance of the notice of award to the joint venture as the bidder with the lowest calculated responsive bid for the lease with option to purchase of the oMR,” the SBAC 1 said in its Resolution 2015-004 issued on July 9. Smartmatic-TIM offered P1.72 billion, or P780 million lower than the approved budget of P2.5 billion

Tuesday, July 14, 2015 • Editors: Vittorio V. Vitug and Max V. de Leon

for the project. The Comelec earlier granted the protest of Smartmatic-TIM Corp. reversing its disqualification dur-ing the postqualification evaluation stage of the public bidding. The Comelec made the deci-sion after the f irm convinced the poll body that their oMR demo machine is compliant with the technical requirements of the project. The SBAC 1, in its resolution, directed Smartmatic-TIM to post the necessary performance secu-rity “in an amount equal to a per-centage of the total contract price” to the Comelec. As soon as the notice of award is issued, the Comelec and Smartmat-ic-TIM can already proceed to the discussions of the contract details. To note, Smartmatic-TIM is also undergoing postqualification evalua-tion before the SBAC 1 for the supply of 70,977 oMR units. Smartmatic-TIM was also de-clared as having the lowest calculated bid for the P7,867,298,140 project. The use of all-new oMR units by combining the 23,000 and the 70,977 units is one of the two remaining op-

Comelec set to award P1.72-BOMR deal to Smartmatic-TIM

By Joel R. San Juan

THE Commission on Elections (Comelec)-Special Bids and Awards Committee (SBAC) 1

has issued a resolution recommending the issuance of the notice of award in favor of Smartmatic-Total Information Management (TIM) Corp. for the provision of 23,000 Optical Mark Reader (OMR) machines to be used in the May 2016 national and local elections.

Group files charges against LRT 2 BAC over ‘rigged’ maintenance deal

Small-scale vermiculture boosts livelihood, generates employment, TUCP’s Herrera says

FISh ShOPPIng A seafood vendor (left) assists a customer, who seems to be having a difficult time in choosing which fresh seafood product to buy, at the Cogeo Market Ventures Corp. (CMVC) in Cogeo, Antipolo City, Rizal, over the weekend. The prices of seafood products went up slightly due to Tropical Storm Egay and Typhoon Falcon which prevented most fishermen from setting out to sea for days. PNA

tions being eyed by the Comelec for the 2016 polls. The other option is for the refurbishment of the old Pre-cinct Count optical Scan (PCoS)

machines to be supplemented by the 23,000 oMR machines. however, the Comelec-SBAC 2 had declared a failure of bid-ding for the repair of the 81,896

old PCoS units after no bids were submitted. It is now mulling over to adjust anew the approved budget for the project which is P2.07 billion.

FFCCCI and ABS PARTYLIST GRANT A TWO-CLASSROOM BUILDING IN SAN MATEO, RIZAL

briefscheaper fuel at the pump

OIL firms reduced the prices of their petroleum products to reflect the continued downward trend of petroleum prices in the international market Eastern Petroleum Corp. was the first to implement a price rollback in gasoline and diesel prices by P0.60 and P1.50, respectively. The downward adjustment took effect at 6 p.m. on Monday. Petron Corp., Pilipinas Shell, Phoenix Petroleum, Seaoil and PTT Philippines implemented the price cut, including P1.60 per liter for kerosene, starting on Tuesday morning. Fernando L. Martinez, Eastern Petroleum chairman and chief executive, said local pump prices have been reduced amid the continuous downtrend of prices in the world oil market due to various geopolitical factors. “If this downtrend in international and local fuel prices continues, this will augur well for the Philippine economy and in meeting the government’s inflation target of below 2 percent for the year,” Martinez said. Last July 7 the price of gasoline went down by P0.70 per liter. Diesel and kerosene prices also declined P0.65 per liter, respectively. Lenie Lectura

news@businessmirror.com.ph Tuesday, July 14, 2015 A5BusinessMirrorEconomy

By Jovee Marie N. dela Cruz

TO stop the abuses committed by some cab drivers on the streets, a technical working

group (TWG) of the House Com-mittee on Transportation is now drafting a substitute bill for six proposals to provide a Bill of Rights for Taxi Passengers. Unang Sigaw Rep. Estrellita Suansing of Nueva Ecija, head of the TWG, said that after the substitute bill is finalized, the TWG would present this to the mother committee for discussion and approval. The measure aims to protect the commuting public, foreign or nation-al, tourist or local, from the discour-teous and unprofessional conduct of some taxi drivers. Suansing said that it a lso hopes to lift the image of the taxi industry by establishing standards addressing the basic rights of the passenger. Among the proposed taxi pas-senger’s rights under Suansing’s bill are the rights to a licensed, properly dressed and courteous taxi driver; see the driver’s ID, stat-ing his name and the taxi opera-tor’s name, the place of business, contact numbers and containing the driver’s picture. The bill said the ID shall be prominently displayed inside the cab; direct the route or expect the most economical route; a duly cali-brated and properly sealed taxi me-ter; pay the fare as exactly posted in the meter and be given the exact amount of change; a printed de-tailed receipt; a clean, smoke-free and in good condition taxi; travel with an assistance, animal or por-table mobility aid; a quiet trip; have the air-conditioning on or off; and a substitute taxi or be assisted to get one in case of mechanical trouble or other similar instances. The bill also proposes a fine for erring taxi drivers, ranging from P500 to P10,000, depending on the violation, and suspension of the taxi driver’s license and/or the Certificate of Public Convenience (CPC). Another proposal is House

Bill (HB) 2346 filed by Liberal Party Rep. Lucy Torres-Gomez of Leyte providing for a regulation of activities of taxi operators and drivers like issuance of receipts, and requiring taxi drivers to wear company-prescribed uniform with name plates. It also prohibits certain prac-tices among them: asking for intended destination without al-lowing the passenger board the taxi; charging a specific amount of fare; and not employing a taxi meter. It proposes a fine of P2,000 to P10,000 for the erring driver or operator and suspension of the driver’s license and operating fran-chise. For the third offense, the penalty shall be P50,000 for the erring company or operator and revocation of the driver’s license and franchise. Mea nwh i le, HB 2669, au-thored by Lakas Reps. Gloria Ma-capagal-Arroyo of Pampanga and her son Diosdado Macapagal Ar-royo of Camarines Sur, requires taxi drivers to give exact change to their passengers. The measure proposes a fine ranging from P1,000 to P5,000, and suspension of the taxi driver and his license. Mea nwh i le, HB 3681, au-thored by Nationalist People’s Coalition (NPC) Rep. Sherwin Gatchalian of Valenzuela City, also proposes a Bill of Rights of Taxi Passengers to protect the public from abusive, itinerant, discourteous taxi drivers and to sanction them for their offenses. Gatcha l ian’s bi l l proposes a f ine amounting to P500 to P10,000 and suspension of the driver’s license and/or CPC, de-pending on the violation commit-ted by the taxi driver. HB 3371, filed by NPC Rep. An-gelina D.L. Tan, MD of Quezon, seeks to require establishments, such as malls and shopping centers, commercial areas, airports and bus terminals to put up designated taxi stands and to issue passenger stubs to provide the necessary informa-tion regarding the taxi vehicles that passengers will hire.

House TWG drafts bill of rights for cab passengers

IBON said this is a better invest-ment compared to the Pantawid Pamilyang Pilipino Program (4Ps) and Universal Kindergarten law (UKL). While the 4Ps and the UKL in-creased primary school enrollment, the commercialization of education and the deterioration of jobs will re-main in the country. “Beyond pursuing the MDG [Mil-lennium Development Goal] targets, the government should undertake

long-term solutions to poverty and lack of education. It can start by in-vesting in domestic agricultural and industrial production and providing efficient and accessible social ser-vices,” IBON said. IBON said the Aquino administra-tion’s recent report to the United Na-tions that the Philippines can meet some of the MDGs in 2015 is not an indicator of progress. It said that the genuine mea-

SEN. Francis “Chiz” Escudero on Sunday said the Senate will look into the safeguard

mechanisms in place at the Philip-pine Health Insurance Corp. (Phil-Health) which receives one of the biggest chunks of public spending for health.

Escudero said this will ensure that government allocation for the health coverage of the poor would not go to scammers.

“We will check the check and balance, safeguard mechanisms of PhilHealth because it happens even in other countries,” Escu-dero said.

In 2014 the government ear-marked P35 billion for PhilHealth premiums to cover 15 million indi-gents in the Philippines, a 179-per-cent increase in government health subsidy for the poor.

For this year, over P36 billion has been set for premium payments of indigents.

“The budget of PhilHealth is being allotted for the payment of premiums of the beneficiaries. It is not for the PhilHealth operation,” the Senate Committee on Finance chairman said.

Out of 90 million Filipinos en-rolled in PhilHealth, 43 million are indigent members, he added.

Escudero said the recent scams uncovered by the PhilHealth should not stop the agency from approving claims for cataract surgeries.

Cataract removal is the fifth most

Ibon to aquino administration: Invest more in agriculture, industrial production

By Cai U. Ordinario

IF the government wants to eradicate poverty and address social ills, Ibon Foundation Inc. said the

administration must invest in agriculture and industrial production.

sures to address underdevelop-ment in the country is still lacking and that efforts exerted to meet the MDG targets were “superficial and shallow.” IBON said the Aquino govern-ment reported to the United Nations Economic and Social Council (Unes-co) that there is a moderate chance that income poverty incidence will be reduced by midyear 2015. The government, IBON added, was optimistic that the Philippines will meet the goal on the universal access to primary education. “Measures which the government took to meet MDG targets, such as poverty reduction and universal ac-cess to primary education, have only been artificial and short-sighted,” IBON said. IBON added that instead of gen-erating secure jobs and support-ing agriculture to raise workers

and farmers’ incomes, the pover-ty methodology was modified to lower living standards, assigning the poverty line to a very low P52 per day. This same poverty methodol-ogy did not count the homeless and street-dwellers of Metro Manila among the poor, for example, thus reducing poverty incidence in the capital region by millions. Using this methodology, offi-cial data reports a family poverty incidence of just 19.7 percent. Yet, based on the same official data, the research group estimates that about 68 percent of the popula-tion live off some P125 or much less per day which is still below the cost of living. IBON ’s May 2015 sur vey, meanwhile, revealed that 67 per-cent of respondents rated them-selves as poor.

Senate to look into PhilHealth’s safety mechanisms against fraudulent claims

sen. revIlla seeks furlough to vIsIt aIlIng fatherDETaInED Sen. Ramon “Bong” Revilla Jr. on Monday filed an urgent motion before the Sandiganbayan First Division for furlough to visit his father, former Sen. Ramon Revilla Sr., after the latter was admitted to the intensive care unit due to bacterial and neurological diseases. In a two-page motion, Revilla asked the court to allow him to leave detention for at least five-hours, from 3 to 8 p.m., preferably on July 14 or 15, to visit his 88-year-old father at St. Luke’s Medical Center at the Bonifacio Global City in Taguig. “Senator Revilla feels distraught and concerned about this unfortunate development involving former Sen. Revilla Sr., especially because of his present detention. He feels it is his obligation to come to the aid of his father, who is very close to him, even by his mere presence, and cannot disregard a son’s natural urge and desire to visit and be with his ailing and weak father, and spend a few moments together, to provide former Senator Revilla Sr. the needed assurance and support,” the motion said. The motion added that on Saturday, he learned that his father was rushed to the hospital and was confined at the hospital’s ICU after being diagnosed with bacterial infection called Gram negative Bacteremia, secondary to Urosepsis, and disorder in the function of brain neurons Septic and Metabolic Encephalopathy. “While former Senator Revilla has already been transferred from the ICU to a private regular room of the hospital, he is still very weak and is in continuous and close monitoring for possible complications,” the motion added. The Sandiganbayan is set to hear Revilla’s motion on Tuesday. Jovee Marie N. dela Cruz

THE Court of Appeals (CA) has upheld the ruling of the Regional Trial Court

(RTC) in Pasig City nullifying an ordinance of the provincial gov-ernment of Rizal slapping tour-ism tax on fast-food restaurants.

In a 19-page ruling written by Associate Justice Priscilla Balta-zar-Padilla, the CA’s Special Fourth Division affirmed the decision of the RTC in Pasig City that declared null and void Rizal Provincial Or-dinance 98-01.

The Sangguniang Panlalawigan of Rizal enacted on January 19, 1998 the ordinance establishing the Rizal Tourism Promotion and Develop-ment Fund.

Under the said ordinance, a 1- percent tourism tax was imposed on the gross sales of hotels, restau-rants, night clubs, disco, and beer houses, and similar establishments in the province.

Jollibee Foods Corp., through its franchisees Lyns Foods Services Inc. and Jabelle Foods Services Inc., filed an action for Protest of Assessments under Local Government Code’s (LGC) Section 195 and for declara-

common procedure reimbursed by PhilHealth in 2014, accounting for 128,331 paid that amounted to P2,056,379,782.

Escudero said PhilHealth just needs to be thorough about vali-

dating claims.Last year the PhilHealth made

a total of P78 billion in benefit payments, 23 percent of which went to private hospitals and clinics.

On July 1 the Senate began its inquiry into the reported P2 billion suspicious claims of hospitals and clinics accredited by PhilHealth, many of them for cataract-removal procedures. PNA

snack tIme A vendor arranges her snack items at her rented stall in Manila. These snack items are all-season gastronomical treats for most Filipinos. StePHanie tumamPoS

CA voids Rizal provincial govt’s ‘tourism tax’ on fast-food chainstion of nullity of the ordinance be-fore the RTC in Pasig City.

The RTC found that the tax ordinance was enacted without complying with the mandatory requirements laid down in Sec-tion 186 of the LGC as it de-clared null and void the same, among others.

It also ordered the provincial government of Rizal to withdraw and cancel the assessment notices

issued to the fast-food chains and to cease and desist from assess-ing and collecting tourism taxes from them.

This prompted the province of Rizal to seek redress with the CA.

In its June 1 ruling, the CA said that the Rizal government “did not comply with the manda-tory requirements of posting and publication, considering that the newspaper they submitted reveals

that the proposed ordinance was published only after the lapse of almost a year after its approval.”

“[The said ordinance] must be declared void. A void and ineffec-tive ordinance could not vest upon respondents-appellants the power to levy the assailed tourism tax,” the CA added.

Concurring with the ruling were Associate Justices Mario Lopez and Socorro Inting. PNA

DraInage rehab Workers of the Department of Public Works and Highways (DPWH)-South Manila District Engineering Office rush the rehabilitation of a drainage system along Roxas Boulevard Center Island from Buendia flyover to Edsa flyover over the weekend to minimize flooding in the area during rainy days ahead. Pna

Tuesday, July 14, 2015

OpinionBusinessMirrorA6

What are the people saying and why

editorial

Listening to some supporters of the potential presiden-tial candidates, opinion surveys are taken seriously; maybe too seriously.

 the reactions usually are, “Look how smart/foolish the people are” to “the polls are biased and completely unreliable.”

the statistical science of polling and surveying is very difficult. Finding a reasonably sized sample of people that represent the other 99.999 percent of the population is a huge challenge. the questions must be unbiased. the en-vironment must be such that honest answers are recorded.

if all of those factors are successfully achieved, then comes the task of interpreting the results. While the polling companies would prefer that we just accept their numbers at face value, it is not that simple.

the administration is pleased, highlighting the results of the latest so-cial Weather stations (sWs) survey taken from June 5 to 8. the sWs survey showed that net public satisfaction with the national government went up by 12 points to a “good” +31 from first quarter’s “moderate” +19.

However, there are some interesting internals with the results.Perception does not always reflect reality. sometimes what we think we

see is not what is really there in front of us. But then again, sometimes a per-son’s perception is closer to the truth than what we say is the reality. Further, it might not even matter what the reality is since what we perceive to be true creates our actions and attitudes.

sWs reported that the Aquino administration, out of 20 issues, received net satisfaction ratings of “good” on six issues, “moderate” on five, “neutral” on another five, “poor” on three, and “very bad” on one issue.

the “very bad” rating of -50 was on the issue of the resolution of the Ma-guindanao massacre case.

the “good” ratings centered on improving public education, the power sup-ply, overseas workers’ welfare, foreign relations, helping the poor and ensur-ing that medicines are available. Defending the country’s territorial rights, restoring peace to Mindanao, giving justice and fighting terrorism rated in the middle of favorably.

it is the “poor” ratings that are most interesting. these were “fighting in-flation,” “ensuring that no family will be hungry,” and “ensuring oil firms do not take advantage of oil prices.”

the trend of Philippine core inflation rate has never been any better, according to official numbers. What is the public seeing that the data is miss-ing? Or is this just the attitude that prices are always high and going higher?

the question on hungry families obviously shows that the government’s message about the success of its programs is either not getting out or not being believed. either way, that is potentially a problem that the government is not properly addressing. While gasoline prices do seem to go up faster than they go down, it is interesting that people are blaming the government.

For all of the potential faults of polling and surveys, ignoring what the public thinks is a serious mistake.

Conclusion 

tHere’s no reason the government cannot accelerate spending. it has adequate funds (financial condition healthy); it enjoys favorable credit rating; and there is no shortage of

important and much-needed projects.

WHen i became a licensed stockbroker/registered representative on the new York stock exchange, one of the old timers pulled me into his office.

High GDP growth: Govt has the ball

The 3 rules for stockbrokers

THE EnTrEprEnEurManny B. Villar

Only this month, the Japan Credit rating Agency raised the Philippines’s credit rating from “BBB” to “BBB+,” just a notch lower than the “A” rating given to singapore, and higher than the “BBB” given to indonesia. the country has also earned invest-ment-grade rating from international credit-rating agencies: Moody’s inves-tor service, Fitch ratings and standard and Poor’s. During sluggish economic periods, governments have to adopt stimulus programs to prep up the private sector. in the Philippines, the private sector is leading economic activities. Almost every week, newspapers carry reports about companies launching multi- billion projects or expanding their capital-expenditure budgets. As i’ve said before, it is the gov-ernment that must follow the private sector’s lead. in other words, it is now

the private sector that is “stimulat-ing” the government to pursue its own projects that will further boost economic activities. the time to launch as many infra-structure projects as possible is now. the country’s investment-grade credit rating makes it attractive to foreign in-vestors, and, in addition, interest rates remain low. Another reason for doing these proj-ects now is that next year, implementing public-works projects will be affected by the 45-day ban before and after the national elections. the government launched the public- private partnership (PPP) in 2010 as its flagship infrastructure program. since that time, nine PPP projects have been awarded, namely, the P2.24-billion Daang Hari-south Luzon expressway Link road; the P3.15-billion integrated transport system-southwest terminal;

He related to me the three rules for successful stockbrokers that you always had to remember. these were: 1) it is only money; 2) it is not my money; and 3) it will not make any difference in 20 years.

At first glance, these rules show the evil underside of the stock market and the people who are involved in it. How could any industry survive and prosper with a belief system like this that they follow as they make recommendations to clients. Worse yet, what about those funds that actually manage client in-vestments following the “three rules”?

Considering the fruits of your hard- earned labor as “only money” is obviously disrespectful to both your time and ef-fort and to you personally. An investor comes to the stock market for the oppor-tunity to increase wealth through letting money work to make more money. that is the only reason for being there, and for stockbrokers to take this attitude

is a disgrace.the second rule shows that the stock-

brokers are in it for only themselves. they are only concerned about the money they can make off your investment. An investor is just a number, one among hundreds—maybe thousands—of cli-ents who are brought to the market to feed its insatiable need and greed for more investors and more investor money.

stock-market investors are in stocks because they are looking toward a long- term brighter future so it will make a difference in 20 years. even those who are seeking shorter-term profits are thinking about what an increase in their wealth will mean for their future and of their families. the investment made today may make it possible to pay for a college education a decade or two down the road. Future family security, even for the grandchildren, is part of the plan. And stockbrokers apparently are

the P34.44-billion Mactan-Cebu inter-national Airport Passenger terminal Building; the P44.65-billion Light rail transit-1 Cavite extension and its opera-tion and maintenance; the P2.24-billion Automatic Fare Collection system; the P23.90-billion ninoy Aquino interna-tional Airport expressway (Phase ii); the P16.28-billion PPP for school in-frastructure Project Phase i; the P3.86-billion PPP for school infrastructure Project Phase ii; and the P5.62-billion Modernization of the Philippine Ortho-pedic Center. early this month, the Department of Public Works and Highways announced that it was inviting foreign and local companies to bid for the proposed P15-billion Central Luzon Link expressway (CLLex), which will connect tarlac to Cabanatuan City in nueva ecija. the 66.4-kilometer CLLex will start at the end of the 94-kilometer subic-Clark-tarlac expressway up to the 88.85-km tarlac-Pangasinan-La Union expressway. the Japan international Cooperation Agency will finance the construction of the toll road, while op-eration and maintenance will be under a concessionaire. the government has also prepared a pipeline of medium-term and long-term infrastructure projects, worth a total of P1.9 trillion. these include road projects estimated to cost P130 billion. Among the biggest road projects is the Cavite-Laguna expressway, which was recently won by the Metro Pacific group. the project will connect the south Luzon expressway to the Cavite expressway. the PPP pipeline also includes the

P390-billion Mega Manila subway, which will cover 74 km from san Jose del Monte in Bulacan to Dasmariñas in Cavite. Of all the long-term projects, the biggest is the Metro rail transit Line 7, which is estimated to cost about P104 billion. this will run from Blumentritt in Manila to Commonwealth Avenue in Quezon City, and end at Banaba in san Mateo, rizal. Airport projects, estimated to cost P475.9 billion, will include the proposed new naia Airport. All these projects will produce wide-ranging benefits in different sectors of the economy. the new toll road to nueva ecija, for example, will create economic hubs in the eastern part of Luzon. in-creased mobility and access to different parts of the country will boost tourism and create opportunities for industries and businesses. Accelerated spending for infrastructure will, hopefully, raise the economy’s growth rate after the slow-down in the first quarter. At the same time, it will also help the government achieve its other target: re-ducing unemployment. infrastructure projects generate a lot of jobs in the construction industry and stimulate other businesses. the country’s unemployment rate, according to the national statistics Of-fice, averaged 6.4 percent in 2014. For this year, the government is targeting an unemployment rate of between 6.6 percent and 6.8 percent. 

For comments, e-mail mbv.secretari-at@gmail.com  or visit www.mannyvil-lar.com.ph.

not concerned in the least for the long-term future of their clients.

As upset as you may be with your stock broker at this point, on closer examina-tion, these rules are almost exactly what personal-finance coaches and gurus give seminars about all the time. You even pay money to hear them say virtually the same thing.

Wrapped up in a moral and religious context, these are the catch phrases of the local personal finance gurus. Here is a selection of their ideas on rule no. 1 us-ing their own words: “Your money should not define who you are.” “While money is important, there are other things that are more important than money.” “How we view money is a reflection of how we view the Lord.” “Money is a great tool, but not the end goal.” “every financial decision is a spiritual decision.”

in other words, “it is only money.” And because it’s only money, we are told that we should “invest in good friends,” “invest in culture and adventure,” “invest in your family at all times,” and “invest in your spirituality.”

the “three rules” are also for stock traders. in very high-stakes poker tour-naments, players use “chips,” not cash money. if you think of your investment as “money” and not simply “chips,” you will make terrible mistakes, like hold-ing losing positions because you do not want to lose money. Money is always emotional; numbers on a page are not.

the personal-finance coaches often

make a strong point about it not being your money. Many speak of your wealth as being a “blessing” from an outside force that you are given stewardship over. that is a very important concept. Hon-orable and ethical people usually take better care of someone else’s property than they do their own. stock traders tend to be more reckless with their own money and show more responsible plan-ning and management of other people’s resources. Further, we become emotional about our own resources. notice that sur-geons rarely would operate on a member of their own family.

if you are making immediate deci-sions while thinking 20 years in the fu-ture, you will make serious short-term errors. We cannot understand all the long-term consequences of our decisions. But we can figure out how those decisions will affect today.  take care of today well and tomorrow will be equally better.

it is only money because we never in-vest an amount that we cannot afford to lose or tie up. We treat our investment without emotion and with the ethics as if it were someone else’s funds. We take care of today and deal with tomor-row when it comes.

E-mail me at mangun@gmail.com. Visit my web site at www.mangunon-markets.com. Follow me on Twitter @mangunonmarkets. PSE stock-market information and technical analysis tools provided by the COL Financial Group Inc.

OuTSIDE THE BOXJohn Mangun

HOM

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CONTACT NOs.: (075) 522-8209/ 515-4663/ 0922-811-4001

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Ortiz Street, Iloilo City CONTACT NOs.: (033) 337-2698/ 508-8102/ 0922-811-3995

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nDWQJ -95dot1 HOME RADIO NAGA STATION MANAGER: JUSTO MANUEL P. VILLANTE JR. EMAIL ADDRESS: homenaga@yahoo.com ADDRESS: Eternal Garden Compound, Balatas Road, Naga City CONTACT NOs.: (054) 473-3818/ 811-2951/ 0922-811-3993

Since 2005

Tuesday, July 14, 2015

OpinionA7BusinessMirroropinion@businessmirror.com.ph

Democracy in Asia Pacific

The Centrist Democrat International (CDI), the largest alliance of conservative and moderate political parties around the world, concluded last Friday its executive Board Meeting,

which I attended as a member of the board and vice president for Asia Pacific. 

ABOUT TOWNErnesto M. Hilario

Former Colombian President An-dres Pastrana was elected CDI’s new-est president to succeed Italy’s former Chief executive Pietro Casini. I was reelected to CDI’s executive Board and as vice president for Asia Pacific. 

In a Leader’s Summit that coin-cided with the meeting and attended by political party leaders from the european Union, Latin America and Africa, I spoke about emerging new democracies in Asia Pacific.

In general, the region remains a bright spot, despite some analysts saying that democracy around the world is in retreat. The 2014 Democ-racy Index of the economist Intelli-gence Unit (eIU) found that Asia was the best-performing region and has been since 2006, the first time the

index was conducted. The 2015 Free-dom in the World study stated that Asia Pacific has been the only region to record steady gains in political rights and civil liberties in the past five years. 

Breakthrough economic growth has also been raising incomes and living standards at a rate unprec-edented in human history.  A large Asian middle class is growing.  And if historical trends persist, they will act as the lynchpin for, and bulwark of, democratic values. 

A paper on the 2013 Asian Ba-rometer Survey even showed that respondents in more prosperous east Asian countries with per capita GDP in excess of US$20,000 were generally not in favor of au-

thoritarianism (“exhibited more detachment from authoritarian-ism”) and had widespread sup-port for democracy.  even respon-dents from hong Kong and  Sin-gapore (categorized in the survey as “non-democracies”) rejected authoritarian alternatives when asked if they could change or im-prove their respective political systems and governments. 

But as Asia Pacific remains a growth area for democracy and prosperity, the region should not blindly follow Western-style de-mocracy.  As the Economist pointed out in 2014, it was the West’s diffi-culties with their democracies that left them unable to unravel politi-cal gridlock, stave off economic re-cession, and provide much-needed employment. 

A more nuanced and flexible ap-proach must be adopted to keep up with the times, especially where there’s scant respect for politicians and political institutions. Promoting democracy in Asia may have to shift its focus away from individualistic rights and liberties, to collectivistic goals and familial ideals. 

Another paper on the 2013 Asian Barometer Survey revealed that only 19 percent of Asian youth equate de-mocracy with freedom and liberty,

but nearly a third (31 percent) with good governance and 27 percent with social equity.

In other words, nearly 60 percent of Asian youth equate democracy in broad societal goals, rather than norms and procedures or civil lib-erties. They see in democracy the prospects of having better leader-ship and achieving equitable shar-ing of wealth.  

however, this isn’t to bring up the old argument of “Asian values” and their incompatibility with Western-style liberal democracy.  A 2012 University of California-Irvine study on Confucianism and Democratization in east Asia even demonstrated that Confucius’s teachings on familism and com-munitarianism actually promote “democratic citizenship.”

Democracy may be a universal aspiration. But it should be seen as a “culturally rooted practice,” just as The Economist emphasized in 2014. The Asia-Pacific region is in transi-tion, presenting an opportunity for democracy to further consolidate.    Its history should not be taken out of consideration.  Traditions and in-digenous philosophies should not be discounted.  

E-mail: angara.ed@gmail.com.

Edgardo J. Angara

‘SeLeCTIve prosecution” is how lawyer Levi Baligod, one of our resource persons in last Saturday’s Media Forum@Annabel’s, described what appears to be the cherry-picking

by the Aquino administration of who to charge with graft or plunder in connection with anomalous transactions.

AS Bank of Japan (BOJ) Governor haruhiko Kuroda fails to get much traction in his bid to revitalize his country’s economy, he should spare a thought for the man who warned

him this would happen: his predecessor.

Failing on inflation, Japan fudges the numbers

In the first batch of those indicted in connection with the P10-billion pork-barrel scam involving business-woman Janet Lim-Napoles and fake non- governmental organizations, only three senators identified with the opposition are on trial for their alleged participa-tion in the caper. The Office of the Om-budsman has yet to file the appropriate charges against those in the second and third batches of the scam, which include legislators considered as administration allies or supporters. Former Negros Oriental Rep. Jacinto Paras also came to the news forum car-rying documents to prove that same “selective prosecution” is what’s going on in the case of the mess at the Metro Rail Transit (MRT). The Office of the Ombudsman recent-ly filed graft charges against former MRT General Manager Al vitangcol for giving the contract for the operation and main-tenance of the rail system to Ph Trams, where his uncle was said to be among the stockholders. But Paras wondered why Department of Transportation and Com-munications (DOTC) Secretary Joseph emilio A. Abaya and Undersecretary Jose Perpetuo M. Lotilla were not charged as well, when they were the ones who signed the allegedly anomalous contract. even more intriguing, Paras said, is that one of those indicted by the Om-budsman for the contract with Ph Trams, a certain Marlo de la Cruz, said to be an official of the Liberal Party, is also one of those behind the new firm contracted by the DOTC to undertake the MRT 3 operation and maintenance. There’s not only selective prosecu-tion in this particular case, there’s also what appears to be a brazen attempt to make the MRT 3 a milking cow for per-sonal—and perhaps partisan—gain.

World-class roads to attract more investments AMONG the reasons consistently men-tioned by foreign investors for their re-luctance to put in more money in busi-ness ventures here is the sad state of our public infrastructure, such as roads. But with a number of road projects now being built under the Public-Private Partner-ship (PPP) Program, we can entice more foreign investors to come. Leading the charge in building world-class expressways here is Metro Pacific Investments Corp. (MPIC). Its subsidiary, Metro Pacific Tollways Corp. (MPTC), is now the country’s biggest op-erator of toll roads.   Through various subsidiaries, the conglomerate already operates the North Luzon expressway (Nlex), Subic-Clark-Tarlac expressway (SCTex) and Manila-Cavite expressway (Cavitex). It is about to begin construction of the Cavite-La-guna expressway (Calax), and has pro-posed the construction of an Nlex-Slex Connector Road. Apart from these, it has set its sights on other PPP road proj-ects, including the Central Luzon Link expressway that will extend SCTex to Nueva ecija. There’s more. The conglomerate plans to extend Nlex from Bulacan to Caloocan and Manila’s port area through several harbor Link subprojects; another proj-ect will extend Nlex to Commonwealth Avenue in Quezon City; and still another will integrate Nlex and SCTex with the Tarlac-Pangasinan-La Union express-way (TPLex) being built by San Miguel Corp. in the North. Once it is finished, Calax will inte-grate with Cavitex and feature the same modern facilities of MPTC’s existing toll roads. The project will generate more than 3,000 new jobs during construc-tion. Thousands more of new jobs can result from new investments along the Cavite-Laguna corridor due to the im-proved infrastructure.  MPIC’s road projects will also ad-dress another major complaint by the business community: the congestion

at Manila ports, which is estimated to cost foreign businesses $500 million in combined losses from port-congestion surcharges and additional trucking and hauling expenses in 2014 alone.  The Calax project, along with the completion of Cavitex, Nlex and SCTex improvement projects, and the govern-ment’s approval of its own version of the Nlex-Slex Connector Road, would also ease port congestion since these roads would speed up travel to and from the alternative ports in Subic and Zambales and allow businesses to haul their goods out of the congested South harbor and the Manila International Container Terminal.  With the recent approval by the Department of Public Works and high-ways (DPWh) of the revised design for the Nlex-Slex Connector Road and the plan by Cavitex Infrastructure Corp. to start work on its Circumferential Road (C-5) Link expressway connecting its R-1 expressway (Coastal Road) to C-5 Road in Taguig City, motorists can ex-pect smooth travel in Metro Manila. Originally planned as a 13-kilome-ter expressway, the Nlex-Slex Connec-tor Road would link C-3 in Caloocan City to the Polytechnic University of the Philippines main campus in Santa Mesa district in Manila and include a 5-kilometer common alignment with SMC-Citra’s Skyway Stage 3, which is a six-lane, 14.8-km expressway from Slex-Buendia Avenue in Makati City to Nlex-Balintawak in Quezon City. The Nlex-Slex Connector Road is expected to improve transport logistics due to the more efficient movement of cargoes, roll-on, roll-off vessels, and pas-sengers in and out of the ports in Manila. It will also reduce travel time from Nlex to Slex to only 15 to 20 minutes.  Investors would be glad to put their money in business ventures here when this project is completed because it would enhance connectivity between our inter-national airports and seaports, including the Subic Freeport by way of the Nlex-SCTex route, the Batangas Port via Slex, and the Clark International Airport to the Ninoy Aquino International Airport.  This will, in turn, improve linkages between the key growth areas of Metro Manila, Central Luzon, North Luzon and the Clark-Subic corridor.  According to studies, the Nlex-Slex Connector Road would decongest edsa, C-5 and other roads in Metro Manila’s inner cities because these choked arteries would be freed of heavy vehicles travel-ing to and from Manila’s Port Area.  Work on the C-5 Link expressway, on the other hand, will start soon. This project is a P9-billion, 7.6-km express-way connecting C-5 Road in Taguig City to R-1 (Coastal) expressway.  The Toll Regulatory Board (TRB) is required to issue the Notice to Pro-ceed for this project, as soon as an independent consulting firm issues a certification under the toll-operation agreement on the availability of the right of way for the alignment already approved by the DPWh, the approval of a final engineering design now un-dergoing final review, and construction schedules and costs.  Aside from TRB’s approval in prin-ciple, the Cavitex extension project has been endorsed by Parañaque City and its barangays, particularly the residents of Merville, Moonwalk and Multinational subdivisions.   The Department of environment and Natural Resources has already issued the environmental compliance certificate for this project.  Once completed, the project would untangle traffic congestion in Parañaque City, and will provide safe, fast and con-venient expressway travel for users in Cavite, Las Piñas, Parañaque, Taguig, Makati and nearby areas.

E-mail: ernhil@yahoo.com.

Masaaki Shirakawa has been the anti-Alan Greenspan since leaving the BOJ in March 2013. Where the former Federal Reserve governor pops up all over Tv screens to defend his legacy, Shirakawa rarely speaks. even when his nearly five-year term has been maligned by the govern-ment of Prime Minister Shinzo Abe for being too timid in fighting defla-tion, he has stayed remarkably silent.

When he was still in office, Shi-rakawa always claimed the causes of Japan’s deflation were a rigid econo-my and bad demographics, not a lack of money supply. Kuroda has yet to concede the point explicitly, but his bank’s actions essentially do. The slew of cheerleading reports BOJ of-ficials have started issuing are a tacit admission that Kuroda’s efforts at monetary stimulus have failed. The bank has even changed its method-ology for measuring inflation so the data fit the BOJ’s preferred narrative.

To be sure, sustained inflation would give Abe  major bragging rights, and vindicate his decision to ax Shirakawa and take a more aggres-sive tack to end Japan’s lost-decade ordeal. But tweaking data isn’t the way to do it.

India’s credibility is still taking hits from its abrupt recalculation of the country’s 2014 gross domes-tic product, from 4.7 percent to 6.9 percent. At the time, Morgan Stan-ley’s Ruchir Sharma fumed that offi-cials were “smashing India’s credibil-ity and making its statistics bureau a laughingstock in global financial circles.” The stakes are even higher when the world’s third-biggest econ-omy resorts to this kind of creative data crunching.

In a new research paper, BOJ of-ficials, led by Koichiro Kamada, ar-gue that “the price stability target and the quantitative and qualita-tive monetary easing, introduced

by the bank in 2013, contributed to strengthening the anchor of inflation expectations.”  Too bad that neither data nor bond rates jibe with that view. Yields on 10-year government debt are currently around 0.43 percent, lower than 0.54 percent 12 months ago. If anything, the inverse of what the BOJ is arguing is true.

Meanwhile, the BOJ’s lobbying efforts to tweak official statistics are starting to fall flat. The bank’s economists tried to get government statisticians to take greater account of the deteriorating quality of rented housing over time, which they say would allow the consumer price in-dex to better capture the cost of liv-ing; it would also give investors the sense that inflation is rising faster toward its 2-percent target. But Sei Ueda, director of government price data, says the statistics bureau is con-fident it already accurately measures housing costs.

The truth is, Kuroda’s team has gotten as far as it can with its two huge monetary infusions since April 2013. In addition to buying about $700 billion of government debt annually, the BOJ is also pumping money into everything, from asset-backed securities to exchange-traded funds. The results can be seen in the 56-percent rally in the Nikkei, but not in the areas needed to generate a sustainable recovery, like sizable wages gain

or capital investments by huge companies. In other words, every-thing has gone just as Kuroda’s predecessor Shirakawa predicted.

That has the BOJ resorting to cheerleading. Kuroda’s team contin-ues to churn out report after report insisting reflation efforts are work-ing. The common theme (including last week’s report by Kamada) is that the BOJ’s moves are lifting trend in-flation, stimulating the economy and loosening financial conditions. Yet, the International Monetary Fund seems to have missed the memo. It just downgraded its forecast for Japanese growth this year to 0.8 percent from a prediction of 1 per-cent in April.

If Kuroda wants to motivate any audience, it should be Abe’s Cabi-net. As BOJ governors past warned, ending deflation requires much more than printing yen—or mov-ing the data goalposts. Aside the devaluation of the yen and modest efforts to improve corporate gov-ernance, the government has done little to remake the economy. Plans to encourage start-ups, loosen labor markets, cut red tape and better uti-lize the female work force remain largely on the drawing board. Ku-roda’s monetary bonanza was meant to pave the way for structural shock therapy that has yet to materialize. Kuroda should know that applaud-ing the government’s failures won’t do much to restore his credibility.

Selective prosecution

BLOOMBERG VIEWWilliam Pesek

Two scary charts about ChinaBy Mark Whitehouse | BloombergView

DON’T take too much comfort that China’s stock meltdown didn’t trigger broader panic. There’s still plenty of Chinese debt to worry about.

To maintain the country’s decelerating growth rate at a politically accept-able level, officials have allowed financial institutions to keep pumping credit into the economy. This has made China one of the most indebted developing nations: As of December, the combined debts of households and nonfinancial corporations—with the latter accounting for the majority of the total—stood at 192 percent of gross domestic product, up from 118 percent before the 2008 financial crisis (and that doesn’t include as much as $4 trillion in local-government debt). here’s how that looks:

Much of China’s lending has gone to building excess manufacturing capac-ity and to speculative real-estate investment. It’s hard to know how many of those loans will go bad or which financial institutions will suffer the most. To a large extent, China can absorb losses by recapitalizing state-owned banks that run into trouble. Nonetheless, banks outside China are increasingly ex-posed: As of December, total foreign-bank exposure to the country’s govern-ment, banks and companies stood at $1.3 trillion, according to the Bank for International Settlements. That’s down a bit from September, but still more than five times the precrisis level. here’s a chart:

A Chinese bust could play out in several ways. It could be a long period of stagnation with a banking system paralyzed by bad loans, like Japan in the 1990s. Or, if losses crystallized at a global systemically important bank, it could be more sudden and financially destabilizing. Or both. Whatever hap-pened last week, it’s too early to call.

A8

2ndFront PageBusinessMirror

www.businessmirror.com.phTuesday, July 14, 2015

Low inflation gives BSPchance to cut SDA rates

DTI wants to fast-track PHL-EU FTA

Asia’s largest mall owner unfazed by Chinese stock rout

There is increasing talk among economists and observers for the regulator—the Bangko

Sentral ng Pilipinas (BSP)—to cut the interest it pays on so-called special deposit accounts (SDAs) as inflation has eased and has, in fact, touched a 20-year low in June.

By Catherine N. Pillas

The Department of Trade and Industry (DTI) said on Mon-day that it intends to fast-

track discussions on the european Union (eU)-Philippines Free Trade Agreement (FTA) to spur trade and increase investments. The DTI made the statement after Vietnam moved closer to concluding its FTA with the 28-country bloc, which could put the Philippines at a disadvantage. “We have access to the eU market with the eU-GSP+, we have an ad-vantage. But if Vietnam concludes an FTA with the eU, 90 percent of their products will be at zero duty,” the DTI source said. “Under the eU-GSP+ scheme, only two-thirds of Philippine product lines are at zero duty. We

won’t be immediately put at a dis-advantage, but we have to move fast,” the source added. The eU Generalized System of Preferences Plus (GSP+) allows for the entry of 6,274 Philippine prod-ucts to eU countries at zero tariffs for a maximum of 10 years.  The DTI source hinted that the eU-Philippine FTA is still in the “scoping” stage. “We may be ending the scoping this year, perhaps September.” The scoping paper will spell out the coverage and parameters of the agreement, and if it proves agreeable to both parties, can lead to the first round of negotiations. Specific areas for negotiation in the scoping paper were not disclosed by the source. however, in terms of market access, Philippine garments may become uncompetitive if Viet-nam successfully concludes its FTA

with the eU soon. The local garments industry, however, has continue to depend on imported raw materials, which could be problematic considering that the eU may impose stringent rules of origin requirements on the Philippine exports. Vietnam concluded its 12th round of negotiations with the eU in March, while the Philippines is still at the scoping stage. Aside from being able to pro-duce goods at a lower cost, many foreign investors continue to bet on Vietnam as it is one of the sig-natories to the Trans-Pacific Part-nership agreement. Officials from the eU have said that progress on the scoping have been slow because it is de-pendent on reforms in Manila’s economic policies.

is testament to the influence the BSP has over liquidity levels in the bank-ing system, where excessive levels in money supply quickly leads to unac-ceptable price escalation. Analysts at the Bank of the Phil-ippine Islands have said the record-low inflation of only 1.2 percent in June should finally convince the BSP to make appropriate adjustments on the interest it pays on the special deposits. SDAs, in essence, are anti-infla-tion tools the BSP uses to achieve a desired level of liquidity in the sys-tem and, by this method, also achieve a desired inflation goal. A series of policy adjustments imposed the past many months, in conjunction with appropriate tweaks

in the rate of interest paid on special deposits, allowed the policy-making Monetary Board under the guid-ance of BSP Governor Amando M. Tetangco Jr. to put a lid on inflation thus far this year. From as high as 2.5 percent this year, inflation has since decelerated to 1.6 percent and then to only 1.2 percent in June, in part because the policy initiative the regulators took had the desired impact on the mon-etary landscape, analysts said. The BSP policy initiatives also successfully convinced the vari-ous banks to deploy what deposits they have in lending activities, helping boost the country’s lo-cal output, measured as the gross domestic product. Bianca Cuaresma

The DTI may also require retailers to provide a 30-day advance notice for their proposed price increases in order to moni-tor market prices. But the DOJ-OFC pointed out that the DTI’s requirement for retailers to seek clear-ance for planned price increases negates the recommendatory nature of the SRP. On the part of the Department of Ag-riculture, the DOJ-OFC said it has publicly stated that it may charge producers, sell-ers, distributors and retailers who violate the SRP with profiteering. But the DOF-OFC argued that such warning may discourage small retail-ers, such as sari-sari store owners and ambulant vendors, from determining reasonable prices for their products “The above findings could result in over-regulation of market prices, which prevents natural supply-demand correc-tion, promotes black markets and inhibits industry growth and product develop-ment,” the study showed. Over-regulation and intervention of the government in the market prices, accord-ing to the DOJ-OFC, may lead to “allocative and productive inefficiency.” “When government controls prices and sets the ceiling low, it could increase demand, which may lead to a shortage of supply. Likewise, since retailers cannot set their own prices, they could be tempted to

hoard products, refuse to sell and create an artificial shortage, which could lead to an even higher and prolonged increase in the price of the current supply,” the study showed. It could discourage new investors from venturing into an industry where SRP for a product is imposed, thus, restraining ef-fective competition in the market. The DOJ-OFC said to balance the need for public protection and a more competitive market, price control should be enforced only in emergency situations and that the SRP should re-main a mere recommendation of prices, and without any mandatory require-ments on the producer or seller during nonemergency situations. Sy said the SRP has been applied by the government to cover nonemergency situ-ations and a broader range of products. It noted that price controls were used in certain stringent situations only as an answer to an impending or actual crisis. But a review of the implementation of the SRP shows that “a de facto price control is exercised even in the absence of an imped-ing or actual crisis, calamity, or exigency.” “Suggested retail price should just be a suggestion, not an imposition, by the government. Price control distorts com-petition and does not help the market determine the optimum prices of goods.

It is only in certain cases, like calamities or emergencies, that intervention is essential to prevent abuses by suppliers,” Sy said. The DOJ also explained that even with the SRP in place, cartels in basic commodi-ties, such as rice, garlic and onion, still exist. “We have pending cases against the rice, garlic and onion cartels that the SRP has failed to prevent or deter,” Justice Sec-retary Leila de Lima said in the report. The DOJ-OFC released its recommendation despite opposition from the DTI as con-tained in a two-page position paper sent to Sy on June 11. “Absence of SRP could prompt some manufacturers, distributors, or retailers to take advantage and increase prices at unreasonable levels,” Trade Undersec-retary Victorio Mario A. Dimagiba of the Consumer Protection Group said. He noted that the SRP is being set by the manufacturers, not the DTI. “SRP is used as a tool to ensure that there is no profi-teering, or the sale of any basic necessity or prime commodity at a price grossly in excess of its true worth, which is prohib-ited under the Price Act.” “Well, it [SRP removal] will work both ways. We cannot limit the profit of pro- ducers and retailers. On the other hand, the prices will be volatile for chicken as it has 30 days of growing time only,” Agriculture Un-dersecretary for Livestock Jose Reano said.

DOJ-OFC: Imposition of SRP has to stop. . . Continued from A1

SM Investments Corp., Asia’s largest mall owner by market value, is un-fazed by China’s slowing economic

growth that’s facing a new blow from a stock-market rout. “China will continue to grow, perhaps not at the pace the whole world was used to, but still grow at a pace better than many countries,” Corazon Guidote, the company’s Manila-based head of inves-tor relations, said in an e-mailed response to questions. “The expected slowdown won’t affect the expansion plans” of unit SM Prime Holdings Inc. “nor its operating strategy in China,” she said. The correlation between China’s eq-uity-market performance and consump-tion or production “has weakened since 2011 and almost faded last year,” Nomura Holdings Inc. economists led, by Zhao Yang, said in a July 8 report. China’s stock-

market slump is “very much a sideshow” that “doesn’t reflect on the fundamen-tals” of China’s economy, International Monetary Fund chief economist Olivier Blanchard said last week. SM Prime, which is putting up one mall per year in China, isn’t seeing indications of faltering demand and expects to maintain its occupancy level in Chinese malls “well above” 90 percent, Guidote said. The company is set to open its big-gest shopping mall in China this year and expects to complete a residential project over the next two years, The Standard reported on Monday. In 2014 the China business ac-counted for less than 6 percent of total revenue of SM Prime, Guidote said. For the new malls, such as those in Suzhou and Zibo, their occupancies are likely to improve, she said. Bloomberg News

ADB, PHL loan pipeline worth $1.42B in 2016, 2017

By Cai U. Ordinario

THe national government and the Asian Development Bank (ADB) will be processing as much as

$1.42 billion worth of loans in 2016 and 2017. Projects to be funded by official development assistance (ODA) loans from the Manila-based multilateral de-velopment bank amount to $620 mil-lion in 2016 and $800 million in 2017.

Data obtained from the National economic and Development Authority (Neda) showed that the ODA will cover three projects each year. The three projects for 2016 include the education Sector Improvement De-velopment Program Phase 2, where the ADB is expected to extend some $300 million to cover the entire project. Another project is the $250-mil-lion enhancing Youth School-to-Work Transition Program. The program was

formerly known as the Addressing the Youth employment Challenge Program. The third project for 2016 will be fi-nanced by the ADB and the Opec Fund for International Development (Ofid). It is the $97-million Solid-waste Manage-ment Sector Project. The ADB will finance $50 million of the project through a loan, while the Ofid may take up the balance for the project cost. For 2017, one of the projects is

the $350-million Local Government Finance and Fiscal Decentralization Reform Program Subprogram 2. The ADB will finance $200 million of the amount, while the French Develop-ment Agency will finance the remain-ing $150 million. Also on the list is the $100-million Metro Manila Wastewater Improvement Project, which was formerly known as the Metro Manila Sanitation Improve-ment Project.

The list also includes the $300-mil-lion encouraging Investment through Capital Market Reforms Subprogram 2. The project was formerly known as the Capital Markets and Nonbank Reforms Program Subprogram 2. Meanwhile, grants to be processed by the government and the ADB next year and in 2017 are estimated to reach $111.03 million. Some of the grants will be financed through funds managed by the ADB.

JPMorgan, the largest bank in the US, first raised the likelihood of the BSP reducing the interest it pays on SDAs totaling only

P965.1 billion in June, sharply lower from year-ago deposits to-taling P1.135 trillion. The sharp reduction in SDA rates