PIDS in the News Archived (June 2014)

THE PHILIPPINE strategy for developing small and medium enterprises (SMEs) has been implemented with moderate success, a report from the Philippine Institute of Development Studies (PIDS) said.

Using the Association of Southeast Asian Nations Small and Medium Enterprises (ASEAN SME) Policy Index, the paper Toward Competitive and Innovative ASEAN SMEs: Philippine SME Policy Index 2012 by PIDS senior research fellow Rafaelita M. Aldaba and economics professor Fernando T. Aldaba, posted on the PIDS Web site on Monday, rated the Philippines SME policy development and implementation in eight policy areas.

On a six-point scale with 1 as the lowest and 6 as the highest, the country was rated:

3.7 in institutional framework,
3.79 in access to support services,
2.96 in cheaper and faster start-up and better legislation and regulation for SMEs,
3.6 for technology and technology transfer,
4.4 in international market expansion,
3.7 in promotion of entrepreneurial education, and
4.67 in more effective representation of SMEs interest.

The countrys average score was 3.8.

The study noted the achievements of SME development in the Philippines such as the streamlining of business registration requirements in 100 cities and municipalities in Central Luzon, the creation of 6.5 million direct and indirect jobs, and the creation of a magna carta for MSMEs.

The study recommended that concerned government agencies strengthen and deepen their coordination, simplify the overall business registration process, and formulate a framework for the promotion of entrepreneurial learning.

The government must also provide adequate budget and effective monitoring and evaluation system for these specific programs promoting entrepreneurial learning, the study said. --

Author: Benise Chiara P. Balaoing
Date: June 30, 2014
Source: BusinessWorld

Acting grains chief Francis Pangilinan is to import 200,000 tons more rice this year. This is on top of 800,000 tons that the National Food Authority ordered from Vietnam last Apr., for delivery in May-Aug.
Pangilinan also is to stop the NFAs imposing on foreign suppliers its sole favored cargo handler. He told The STAR this yesterday in reply to exposs that the imposition was for P1.08-billion kickback to the NFA brass (Gotcha, 21 and 23 May 2014).
Flooding the market with a million tons is Pangilinans solution to recent price surges of the Filipino staple. In effect the NFAs rice supply projections and consequent import orders were short.
Ending the NFAs favoring of a monopolistic cargo handler is seen as his intolerance of the agencys entrenched grafters. How far he will go in cleaning it up has yet to be seen.
Pangilinan couches his moves tactfully. He calls the added imports and the end to favored-cargo-handler status renegotiation. That is, new terms are to be worked out with Vietnams two state grains suppliers, Vinafood-1 and -2.
Talks are ongoing for the two to add 25 percent, or 200,000 tons, to the original 800,000-ton indent, which Pangilinan says is allowed in the contract. His weeklong new NFA administrator Arthur Juan is to find legal ways to rescind the NFAs anomalous imposition of a Makati-based cargo handler on the Vinafood contract.
Pangilinan is barely two months in the job of Presidential Adviser on Food Security and Agricultural Modernization. The person in whose turf he is treading, Agriculture Sec. Proceso Alcala, is his and President Noynoy Aquinos Liberal Party mate. Interviewed soon after his presidential appointment, Pangilinan had told The STAR he would be replacing Alcala as chairman of the NFA and three other key agri-agencies transferred to him.
Alcala and political sidekick Orlan Calayag, erstwhile NFA head, have been criticized for messing up the countrys rice supply and food security. Their much-ballyhooed rice self-sufficiency by 2013 had flopped.
Worse, in June that year retail prices of NFA subsidized rice spiked from P26 a kilo to an unprecedented P38, and has since stayed at P36. The dry-season harvest of Apr. had just been dried in mills, a big bulk bought up by the NFA. Too, the first 205,200 tons of the total 705,200 that NFA ordered from Vietnam had just arrived in May.
Alcala and Calayag blamed the NFA rice price surge on price manipulating smugglers-hoarders. How outsiders supposedly got control of NFA stocks and selling prices, they didnt explain. In the confusion, they managed to make senators subpoena the NFAs erstwhile accredited rice importers and shamed as smugglers. One of them was Davidson Bangayan, alias David Tan, who in 2010-2012 had cornered via alleged bribery the bulk of NFA imports, using farmers cooperatives as fronts.
Last May the state think tank Philippine Institute for Developmental Studies (PIDS) said that blaming smugglers was only a ruse. In truth, Alcala and Calayag blindly had over-estimated the domestic harvest and so under-estimated the imports, due to their self-sufficiency daydream. And that import was overpriced by P3.4 billion, for which militant groups have charged the duo with plunder.
Alcala repeatedly claims to already have achieved 96 percent targeted sufficiency then, but fell short by a mere four percent due to one early typhoon. It only goes to show, however, that his calculations were frazzled, given that 16 or so typhoons strike the Philippines each year.
High officials dont believed Alcalas self-sufficiency this year either. Pangilinans one-million-ton import from Vietnam is proof of it.
Compounding the supply problem are onerous insertions by NFA crooks in the Vinafood contracts. Aside from the single cargo handler, for which P1.08 billion in kickbacks will come, there is also a redefinition of the indented well-milled long grain white rice, 15 percent broken. By international standards, this means grains 6.1-6.9 mm long. But during the bidding the NFA said it would accept only 6.5-6.9 mm. The stringent requirement turned off the Thai and Cambodian bidders, leaving only Vinafood, which is accustomed to the commissions that NFA crooks expect.
The redefinition has made it difficult for Vinafood to consolidate the 800,000 tons from Vietnamese farmers. Websites that track global rice trading, like oryza.com, have reported that the farmers cannot meet Vinafoods quality demand, and the latter has threatened sanctions.
Complicating the issue for Pangilinan are conflicting statistics. He says the figures of rice consumption and harvests from Alcalas Dept. of Agriculture are much lower than those of PIDS and the National Economic and Development Authority (NEDA) that consists of cabinet members.
Going by DA figures, the countrys rice consumption per capita (per person per year) is 114 kg. With a population of 100 million, that means a need for 1.14 million tons. Yet the country produces only 1.2 million tons of palay, milled into 600,000 tons of rice, thus necessitating imports to cover the shortfall, plus some as buffer during lean months leading to the wet-season harvest (Sept.) and against disasters.
PIDS and NEDA estimate the annual harvests at 1.85 million. Yet both say this is still not enough to feed the population.
Pangilinan needs to reconcile the conflicting numbers. He says the Bureau of Agricultural Statistics, once under the DA, has been moved to a new Philippine Statistics Authority, under the NEDA.
Pangilinan says the administration will continue the ban on private rice imports that Alcala and Calayag began in 2013. This is against the recommendation of PIDS and NEDA.
The two agencies have been saying that the government should let the private sector do the importing. The DA-NFA can then use the 50-percent import duty to improve rice varieties, irrigation, fertilizers, harvests, and post-harvest facilities and techniques " eventually to achieve self-sufficiency.//
* * *
Catch Sapol radio show, Saturdays, 8-10 a.m., DWIZ, (882-AM).
Gotcha archives on Facebook: https://www.facebook.com/pages/Jarius-Bondoc/1376602159218459, or The STAR website http://www.philstar.com/author/Jarius%20Bondoc/GOTCHA
E-mail: jariusbondoc@gmail.com

Author: Jairus Bondoc
Date: June 30, 2014
Source: Philippine Star

The governments active labor market programs (ALMPs) have provided short-term job opportunities to disadvantaged sectors, but the country must map out programs and policies that will promote private investments to generate more employment.

According to a study released by the state-owned think tank Philippine Institute for Development Studies (PIDS), there is a need to boost growth of small and medium enterprises (SMEs) which have crucial roles in employment generation.

The study said constraints faced by SMEs must be addressed, including the lack of access to additional capital, unavailability /inaccessibility of raw materials and difficulty to comply with Food and Drug Administration (FDA) requirements to penetrate larger markets.

These constraints are consistent with the macro studies on the reasons for the low private investments in the country, PIDS noted.

The study suggested that the country develop policies that will address these identified constraints to SME development. It said it is also imperative to undertake programs linked to the overall industrial policy of government.

The government has established ALMPs to address persistent unemployment and underemployment despite high economic growth.

The community-based employment program (CBEP) is among the governments priority ALMP that aims to contribute to the national goal of inclusive growth, poverty reduction and job creation, particularly in the countryside or the local community.

Components of CBEP are government or public

c-private partnership infrastructure projects, social infrastructure such as livelihood and self-employment undertakings/projects, and emergency response income support projects.

Further, the study said the Philippine economic growth has yet to translate into higher investments specifically in the agriculture and manufacturing sector to have significant increase in jobs. //

Author: Ed Velasco
Date: June 29, 2014
Source: The Daily Tribune

LOS BA'OS, Philippines " The coconut trees are dying and the industry is under threat.
The Philippine coconut industry is an export-oriented sector, according to the Philippine Coconut Authority (PCA). It has about 3.5 million coconut farmers and 26% of the countrys agricultural land is devoted to coconut farming alone.
This industry also contributes an annual average of 5.97% to the countrys gross value added (GVA) and 1.14% to gross domestic product (GDP), PCA statistics showed.
Coconut regions " though one of the most productive industries " host the largest number of rural poor.
Around 60% of the sectors farmers and workers live below the poverty line, according to CODE-NGO, a coalition of Philippine development civil society organizations.
Problems vary from poor farm management practices, natural calamities, land conversion, as well as pest and diseases, the Philippine Institute for Development Studies stressed.
Super Typhoon Yolanda (Haiyan) which devastated several islands in the Visayas in 2013 damaged around 15 million coconut trees.
In 2014, another calamity hit the industry " a pest breakout almost wiped out the coconut trees in Region IV-A.

Cocolisap
The Coconut Scale Insect (CSI) " commonly known as Cocolisap " infested coconut trees around Central Luzon.
Cocolisap is a common coconut pest. It was first detected in 2010 and experts identified it as a local species.
Preventive measures have been applied after its identification, but the insects thrived and more than a million coconut trees were infested. Researchers started to re-investigate the situation.
Cocolisap looks like fish scales and has the ability to reproduce every 9 days for a month. It is commonly found under coconut leaves.
Local species usually thrive during the dry season and die during the rainy period. This, on the other hand, is no ordinary species.
Early this year, a researcher from the University of the Philippines Los Baos went to Indonesia to get Cocolisap samples and validated the pests identity through DNA testing.
The results were positive. Hence, a different approach was developed to manage the pest.
Fighting pest
The university has been the source of scientific information that has guided the PCA on its operations against Cocolisap.
In 2012, UPLBs College of Agriculture proposed an action project for Batangas to control its Cocolisap infestation.
In 2013, Agriculture Secretary Proceso Alcala granted the university a P2-million research fund research on mitigation measures.

UPLB then came up with a method of conducting delimiting survey which helped the PCA to rapidly identify Cocolisap infestations at an early stage while the leaves are still green.
Samples are transported and analyzed at UPLB, and results are then forwarded to PCA, which then sends a quick response team if results prove to be positive.
Mapping the infestation also led to the identification of 3 zones:
Outbreak areas where infestations need massive control
Non-outbreak areas where infestation is starting
High risk areas
Farmer empowerment
The massive treatment of Cocolisap in Region IV-A began on June 20, 2014.
Simultaneous pruning and trunk injection was done in highly affected provinces of Quezon, Batangas, Cavite and Laguna.
The treatment will last for 6 months until all infected areas are covered.
The pesticide will stay in the coconuts system for 55-60 days. Beyond that, the nuts can be safely harvested, Dr Celia Medina, head of the ULBC Crop Protection Cluster, explained.
Local farmers were also briefed about the treatment.

Agricultural competitiveness is not just about the number of developed technologies or methods; it should be stakeholder-oriented too, Dr Susan Bacud, an expert in community pest management, said.
Technology is very important, but the farmers themselves who will use the technology should also be highlighted, Bacud added.
Farmers should be prepared in terms of calamities and pest outbreaks. They can be empowered to conduct their own pest management strategies. They need to be constantly informed.
She suggested that an important scheme to control pests is hasty reporting.
Once a pest species is noticed, farmers should be able to easily communicate with agriculture technicians and researchers. Reporting is one way to prevent outbreaks and farmers should be able to do that.
The end goal of agricultural technology, according to Bacud, should be farmer empowerment. "Rappler.com
Maribeth Jadina works at UPLB.
How can we help fight hunger? Report what your LGUs or schools are doing, recommend NGOs, and suggest creative solutions. Send your stories and ideas to move@rappler.com. Be part of the#HungerProject.




Author: Maribeth Jadina
Date: June 25, 2014
Source: Rappler.com

AS the Philippines battled stronger typhoons and other disasters, the national governments calamity and quick- response funds have at least doubled over a period of only five years, according to a study released by state-owned think tank Philippine Institute for Development Studies (PIDS).

In the study, titled Quick Response Funds (QRF) and DRRM (Disaster Risk Reduction Management) Resources in the Department of National Defense and Various Departments, PIDS Supervising Research Specialist Sonny Domingo said the countrys calamity funds increased to P7.5 billion in 2012 from P3.75 billion in 2010.

Domingo added that QRF levels increased to P2.6 billion in 2012 from P597.5 million in 2009.

In a span of two to three years, Calamity Fund appropriations doubled and QRF levels more than quadrupled, indicating a shift in the governments fiscal priorities, and a greater urgency for DRRM initiatives given the recent spate of man-made and hydrometeorological-related disasters, Domingo said.

In an e-mail to the BusinessMirror, Domingo clarified that prior to 2012, the QRF was an appropriation under the Calamity Fund. However, starting 2012, the QRFs were released directly to various executive departments under the annual General Appropriations Act (GAA) or the national budget.

Domingo explained further that in previous years, the fund comprised 30 percent of the national calamity fund and was released upon approval by the President when immediate funding was required to address the ill effects of natural calamities, man-made disasters and epidemics (as certified by the Department of Health). Before 2012, the QRF was also used for risk-mitigation activities like disaster training and preparedness.

The QRF constitutes part of the national budget that is appropriated for the relief, aid and rehabilitation of communities or areas affected by man-made and natural calamities. It is designed to normalize the situation and living conditions of affected communities in the shortest possible time, Domingo told the BusinessMirror.

The study stated that the QRF were distributed to agencies like the Departments of National Defense, Social Welfare and Development, Public Works and Highways, Agriculture and the Education (DepEd).

Domingo noted that there were more funds allocated to the DA, particularly for the National Irrigation Administration (NIA), while the funding for the DepEd was consistent at around P500 million to P600 million a year.

The study said, however, that the huge QRF allocation for the DepEd in 2007 worth P2.1 billion was due to Typhoon Reming, which devastated the Bicol region in 2006.

Further, the DAs QRF budget fluctuated and settled at around P500 million for the Central Office with commensurate funds for the DA-NIA. Appropriations for the DSWD and OCD (Office for Civil Defense) fairly increased until they reached the above P500-million level starting fiscal year 2010 to 2011.

However, there were discrepancies in the amounts and availment rates reported by the Department of Budget and Management (DBM) and the line agencies receiving the QRFs after 2012. This prompted Domingo to recommend that policies on the use and availment of the QRFs and the Calamity Fund be streamlined.

Administrative and fund availment processes within the executive departments may have also received a shock with data from the DBM showing a sharp increase in QRF allocation in recent years. This contention, however, should be subject to further scrutiny as line agency budgets reflected high levels of QRF availment prior to 2012. There is a big discrepancy between the figures from the DBM and implementing departments on the level of QRF funding over the years, Domingo said.

Without the shock value of resource infusion, the default explanation for low absorption rate/fund utilization in some of the departments would be the inaccessibility of the fund. Existing policy should therefore be streamlined to remove the possibility of this impediment, he added.

The study also recommended that issues on fund control, monitoring and absorption rate, and sufficiency of DRRM-related assets point out entry points for structural and policy augmentations.

Further, Domingo added that the level of stand-by resources for DRRM and the processes underlying their deployment determine the timely delivery of appropriate support and services to affected communities in times of disaster.//

Author: Cai U. Ordinario
Date: June 25, 2014
Source: BusinessMirror

THE upcoming integration of the Association of Southeast Asian Nations (Asean) Economic Community (AEC) in 2015 provides vast opportunities for the Philippines in terms of trade and industry, but infrastructure bottlenecks in the country must be addressed first.
The government and private sector were urged to fully exploit the immense business opportunities that the AEC offers " a statement underscored in a regional forum on the AEC organized by the National Economic and Development Authority (NEDA) Regional Office 9 with the participation of state think-tank Philippine Institute for Development Studies (PIDS) and the Department of Trade and Industry (DTI) regional office in Zamboanga City,
Stressing the need to do more to take advantage of the opportunities from AEC, PIDS Senior Research Fellow Erlinda Medalla said the AEC does not only reduce tariffs but also promotes trade facilitation.
Medalla said the AEC commits the country to implement reforms on customs modernizations and the establishment of a national single window and an Asean Single Window.
National single window is a single submission and accelerated processing of applications of licenses, permits, and other authorizations required prior to undertaking a trade transaction, while the Asean Single Window is a regional initiative that integrates the national single windows of Asean countries, she said.
Medalla noted that a national single window will speed up data processing and cargo clearance procedures, and will have positive impact on the cost of doing business, not just for large industries but also for micro, small, and medium enterprises.
The PIDS research fellow added the country needs to step up in educating and informing the public about the benefits of the coming integration.
There is a need for greater information and education campaign to help small and
medium enterprises get linked to the supply chain and receive support from all sectors. An agro-industry roadmap would also be a great help, she said.
Meanwhile, Senen Perlada, director of Export Marketing Bureau of DTI, said the Asean integration in 2015 would also create vast trading opportunities for the Philippines.
We should not limit our markets only to 100 million Filipinos considering that Asean has a combined gross domestic product [GDP] of $2.4 trillion as of 2013. About 67 million households in the Asean are now part of the consuming class, he said.
The DTI official also said that the country should also take advantage of the Halal market as well the food, logistics, and banking industry.
Perlada also urged the country to engage in free trade agreements (FTAs) to maintain its competitiveness and promote cross-border complementation, emphasizing that it is necessary to maximize the benefits made available by FTAs to exporters.
However, infrastructure development in the country remains a major hindrance to the countrys development amid the planned regional integration.
According to PIDS Senior Research Fellow Adoracion Navarro, the Philippines is the third lowest in overall quality of infrastructure in the Asean region based on the Global Competitiveness Report 2013-2014.
To fully take advantage of the opportunities of an integrated Asean, investments in infrastructure are needed particularly in the aviation industry.
Critical investments in airport infrastructure facilities and air navigation system are needed to address congestion in airport terminals, Navarro said.
NAIA 1 (Ninoy Aquino International Airport Terminal 1) served 7.5 million passengers in 2012, but its capacity is only 5.5 million passengers, she said, emphasizing that it is necessary to boost infrastructure spending to 5 percent of GDP by 2016.//

Author: Mayvelin U. Caraballo
Date: June 24, 2014
Source: Manila Times

The Aeconomic integration of the Association of Southeast Asian Nations offers immense business opportunities that both the government and the private sector should exploit, according to government think tank Philippine Institute for Development Studies.

PIDS senior research fellow Erlinda Medalla cited the need to take advantage of the opportunities from Asean economic communities during a forum organized by the National Economic and Development Authority.

The AEC does not only reduce tariffs but also promote trade facilitation. It commits the country to implement reforms on customs modernizations and establishment of a national single window and Asean single window, she said. National single window is a single submission and accelerated processing of applications of licenses, permits, and other authorizations required prior to undertaking a trade transaction, while the Asean single

window is a regional initiative that integrates the national single windows of Asean countries, Medalla said.
This would have positive impact on the cost of doing business, not just for large industries, but more importantly for micro, small, and medium enterprises, she said.//

Author: Jennifer Ambanta
Date: June 23, 2014
Source: Manila Standard Today

The ports of Mindanao will play a leading role in facilitating inter-island trade once markets in Southeast Asia Integrate by 2015.

There is the need for discussions and the necessary preparations so that opportunities for the region will be optimized.

The Mindanao Shipping Conference (MSC) underscored the importance of strengthening logistical, as well as legislative support for the sector to maximize potentials for Mindanao both domestically and internationally.

Organized by Port Call and the Phividec Industrial Authority, MSC seeks to modernize and put in place the needed logistics in the seaports, considering that 99.9 percent of trade in Mindanao depends on the water transport. Aside from the need to upgrade infrastructures at our ports we should also strengthen the regulations of maritime operations in consonance with the upcoming Association of Southeast Asian Nations integration, said Adoracion M. Navarro, senior research fellow at the Philippine Institute for Development Studies.

Navarro said Mindanao needs deep seaports that can accommodate or allow big international vessels to dock.

For Mindanao that serves 25 percent of the countrys container traffic, the islands ports must be developed to accommodate big vessels at portside and find ways to decongest existing ports. Navarro said.

Other topics discussed during the conference were the new Bureau of Customs policies under the current administration aimed at rationalizing operations and addressing the corrupt customs and trade practices by lawyer Agaton Uvero, deputy commissioner for Assessment and Operations Coordination Group; Economic Prospects of Mindanao with Dr. Cayetano Paderanga; Logistics Initiatives for Mindanao by Engr. Emmanuel Carpio, Maritime Industry Authority director for Northern Mindanao and Caraga.//

Author: Butch D. Enerio
Date: June 22, 2014
Source: BusinessMirror

MANILA - The ASEAN Economic Integration (AEC) offers immense business opportunities that both the government and the private sector must exploit to fully benefit from its advantages.
This was underscored in a regional forum on the ASEAN Economic Community organized by the National Economic and Development Authority (NEDA) Regional Office 9 with the participation of state think-tank Philippine Institute for Development Studies (PIDS) and the Department of Trade and Industry (DTI) regional office in Zamboanga City.
PIDS Senior Research Fellow Erlinda Medalla stressed the need to do more to take advantage of the opportunities from AEC.
The AEC does not only reduce tariffs but also promote trade facilitation. It commits the country to implement reforms on customs modernizations and establishment of a national single window and an ASEAN Single Window, she said.
Single window
National single window is a single submission and accelerated processing of applications of licenses, permits, and other authorizations required prior to undertaking a trade transaction, while the ASEAN Single Window is a regional initiative that integrates the national single windows of ASEAN countries, she said.
Medalla has been pushing for the implementation of a national single window to speed up data processing and cargo clearance procedures. This would have positive impact on the cost of doing business, not just for large industries, but more importantly for micro, small, and medium enterprises.
She added that the country needs to step up in educating and informing the public about the benefits of the coming integration. There is a need for greater information and education campaign to help small and medium enterprises get linked to the supply chain and receive support from all sectors. An agro-industry roadmap would also be a great help, she said.
DTI Assistant Secretary for Industry Development and Trade Policy Perry Rodolfo said that in 2010, duties for 98.63 percent of Philippine products are already at zero percent. As of 2010, all duties have been eliminated for agricultural and industrial products except for live swine, live chicken, meat of swine, meat of chicken, cassava, sweet potatoes, maize, rice, and sugar, he said.
Senen Perlada, Director of Export Marketing Bureau of DTI, said vast trading opportunities will come with the integration. We should not limit our markets only to 100 million Filipinos considering that ASEAN has a combined GDP of USD 2.4 trillion as of 2013. About 67 million households in the ASEAN are now part of the consuming class, he said.


Available markets
Perlada cited as an example a firm in General Santos City that shifted from exporting tuna to frozen smoked salmon. The firm imports zero-tariff salmon from New Zealand and then processes it for export to free trade agreement (FTA) partners.
Another example is Universal Robinas C2 Green Tea. C2 is now one of the largest in the Vietnamese bottled green tea market, Perlada said.
We should also take advantage of the Halal market, he added. There is an advantage in food, logistics, and banking, he said.
The Philippines has to engage in free trade agreements to maintain its competitiveness and promote cross-border complementation.
Perlada emphasized that it is necessary to maximize the benefits made available by FTAs to our exporters.
Improving the quality of infrastructure in the Philippines was also a key topic in the forum.
According to PIDS Senior Research Fellow Adoracion Navarro, the Philippines is the third lowest in overall quality of infrastructure in the ASEAN region-based on the Global Competitiveness Report 2013-2014.
Critical investments in airport infrastructure facilities and air navigation system are needed to address congestion in airport terminals, Navarro said.
NAIA 1 served 7.5 million passengers in 2012, but its capacity is only 5.5 million passengers.
She emphasized that it is necessary to boost infrastructure spending to five percent of GDP by 2016. //

Author:
Date: June 22, 2014
Source: Interksyon TV5

The right of the Muslims in Mindanao to create an autonomous region is guaranteed by our Constitution. The basis of this right is not only because Muslims have a distinctive history, culture, customs and traditions, but also because the central government has failed them in every way. I, myself, during the administration of former President Gloria Macapagal-Arroyo, would jokingly tell my friends that I had mentally seceded from the Republic and was just a cybercitizen.

If I have just one piece of advice to give to the Bangsamoro Autonomous Government, its this: Dont follow, Manila. Manila, of course, is the unitary government based in Metro Manila. Indeed, the worst thing that the Bangsamoro Autonomous Government can do -- and is a sure formula for failure -- is to replicate the same dysfunctionalities that the national government exhibits. Therefore, the leaders of the Bangsamoro Autonomous Government must be determined at the very start to govern differently from Manila, lest they end up as pathetic caricatures of the corrupt, incompetent and dishonest politicians that we read about every day.

The Bangsamoro Autonomous Government will have the right to formulate laws and exercise broad powers within its region, except those powers that are exclusively reserved for the national government (national defense, foreign affairs, coinage and monetary policy, immigration and citizenship) and those powers that are concurrently exercised with the national government (the administration of civil service, coast guard, social security, and so forth). In other words, the Bangsamoro Autonomous Government will have enough powers to chart its own economic and political course.

Given these powers, allow me to provide these pieces of advice to the future leaders of the Bangsamoro Autonomous Government:

Make the region investment-friendly, especially to foreign investors

What you need are jobs for your people, especially since a number of your armed followers will be demobilized and would need jobs. The key to jobs is investments and, therefore, its important that the environment be investment-friendly. How to do this?

Start by liberalizing those areas to foreign investors that can be done by law. If the present Constitution prohibits foreign majority ownership in public utilities, for example, then redefine through legislation what public utilities are within your region. If airports, for example, can be defined as serving airlines rather than the public, then the operation of airports can be opened up to foreign investors.

The present law on leasing of land by foreigners is also very restrictive. Foreigners have to seek approval from the Department of Trade and Industry and they must come only from those industries approved by the government. Pass your own law. Instead of leasing, allow for usufruct, which really has the benefits of ownership without the title. This means that foreign investors can mortgage the usufruct if they need to, in contrast to leasing, which they cannot. If you do this and simplify the procedures for obtaining usufruct of land irrespective of industry, you will have foreign investors flocking to your region.

Also, dont follow Manila and impose a high minimum paid-up capital of $2.5 million for the establishment of retail enterprises. The high minimum paid-up capital was meant to protect the retail monopolists based in Manila. Legislate your own retail trade law but make it more liberal. In this way, you will not only attract foreign retailers, but you can also develop your tourism potential because then, assuming a better security situation, shopping can be a reason to go to your region.

ATTRACT LABOR-INTENSIVE INDUSTRIES
If you want to attract labor-intensive industries, formulate your own labor code that does not set unrealistic high minimum wages and labor security regulations. For sure, still establish minimum labor safety standards and social security regulations, but leave wages to market forces or establish an entry-level wage consistent with the productivity of labor.

Apply the lessons in the excellent study by Dr. Vicente Paqueo and the economists of the Philippine Institute of Development Studies (PIDS), which showed a negative correlation between high minimum wages and job creation. You can attract the labor-intensive industries that want to leave Vietnam, Bangladesh and China -- if you have an enlightened and investment-friendly labor code.

To those who say that this policy is anti-labor, I say that a paying job is better than no job at all. In fact, the study by Dr. Paqueo et al. showed that our current unrealistic minimum wages are anti-poor, anti-young, anti-uneducated and anti-women. Besides, with a globalized labor market, if workers are not receiving wages commensurate with their productivity, they can always leave for greener pastures.

ENACT LAWS THAT PROMOTE GREATER SECURITY OF PROPERTY RIGHTS, AND NOT UNDERMINE IT
Again, dont follow Manila. Dont extend the Comprehensive Agrarian Reform Program (CARP) and dont establish a retention limit of five hectares. CARP is the single biggest reason private investments in agriculture and in rural areas have been low. Again, apply the lessons in the excellent paper by Dr. Raul Fabella, National Scientist for Economic Science, titled CARP: Time to Let Go.

Scrap the total log ban and allow the private sector to grow and sustain the forests, as they do in countries like Norway. In mining, adopt international best practices in regulation and taxation, but establish a stable policy regime.

Because of financial constraints, you may have to focus your efforts initially on special economic zones, where you can assure security and a minimum level of infrastructure support. However, you can have your own Public-Private Partnership program and you can go build your infrastructure requirements quickly with the help of the private sector.

INVEST IN INSTITUTIONS
You are starting off correctly by having a parliamentary system, but you need to ensure that the political parties in the Bangsamoro arent dominated by rich clans or family dynasties. Consider public funding of political parties. Consider investing in a competent bureaucracy.

Dont follow Manila. Instead, with the right economic model, you can build the Bangsamoro Autonomous Region into a Taiwan, a Hong Kong, a Singapore, or a Shenzhen. You can show that inclusive development can be done in the Bangsamoro. Who knows? The tail may yet wag the dog.//

Author: Calixto V. Chikiamco
Date: June 22, 2014
Source: BusinessWorld

WITH the perennial problems of supply shortage and price increases in rice, the countrys food staple, and traffic congestion brought about by the huge volume of motor vehicles plying Metro Manilas routes, experts said there is a need to adopt a competition policy to encourage innovation and prevent cartels, particularly in the rice and transport sectors.
For rice, Roehlano Briones, a senior research fellow of the state think tank Philippine Institute for Development Studies (PIDS) said a more flexible policy toward rice imports should be adopted.
Briones, project director for Competition Reforms in Key Markets for Enhancing Social and Economic Welfare in Developing Countries (CREW), said there is a competitive market structure for domestic rice production and marketing, but rice-import quota, which is decided solely by the National Food Authority (NFA) through the National Food Authority Council, could facilitate a cartel-like behavior.
The NFA manages to stabilize retail prices, but keeps domestic prices high by means of an import monopoly, he said.
Citing a study by Beulah de la Pea, Briones noted that the government allows a few big players in the rice industry to import a minimum of 2,000 MT and a maximum of 5,000 MT of rice under the current importation-quota distribution.
He said the study suggests that small players should be allowed to import 10- or 20-ton container load of rice to prevent rice-supply monopoly by a few big players.
Quantitative restrictions on imports to support the countrys rice self-sufficiency objective must be repealed, Briones said.
If quantitative restrictions were eliminated and rice imports were allowed to freely come in the country, total rice imports would have reached 3.68 million MT, Briones said.
Such high level of imports would have brought down the retail price of rice to P21.43 per kg and P19.39 per kg at the wholesale level, added.
Last year the retail price of rice shot up to P36.28 in December from P32.37 in June, he said. It is equivalent to a 12-percent increase in just six months.
Meanwhile, the market inefficiency in the bus-transport sector is manifested by too many operators and buses that result to traffic congestion, PIDS Research Consultant Debbie Gundaya said.
There are 1,122 bus operators and 12,595 buses plying Metro Manila, she said.
The bus-transport sector market operates under a highly complicated regime, where regulation and enforcement are shared by several agencies, resulting in implementation failures and regulatory capture, she said.
Gundaya noted that there is a proliferation of illegal or colorum buses in Manila routes.
Proliferation of kabit system, where a bus operator enters the market through an arrangement with an operator with an established franchise, is also present, Gundaya added.
PIDS Senior Research fellow Adoracion Navarro recommended that competitively tendered service contracts or concessions for defined routes should be explored.
Rene Santiago, a transportation expert, suggested that contracted trips made on predefined routes and headways should be the basis to pool the revenues and pay bus operators.
The observations and policy recommendations were brought up during a national reference group meeting organized by PIDS; Consumer Unity and Trust Society International based in Jaipur, India; and the Action for Economic Reforms, as part of the activities of a three-year project on CREW.
The project aims to assess the level of competition in the rice and passenger-transport sectors to generate broad-based support, especially from policy-makers, for competition reforms.//

Author: Jonathan L. Mayuga,
Date: June 21, 2014
Source: BusinessMirror

THE ports of Mindanao will play a leading role in facilitating inter-island trade once markets in Southeast Asia Integrate by year 2015 thus the need for discussions and the preparations to optimize opportunities that will emerge in the region.
The Mindanao Shipping Conference (MSC) underscored the importance of strengthening logistical as well as legislative support for the sector to maximize potentials for Mindanao to do business within the country and internationally.
Organized by Port Call and the Phividec Industrial Authority, MSC seeks to modernize and put in place the needed logistics in the seaports considering that 99.9 percent of trade in Mindanao depends on the water transport.
Aside from the need to upgrade infrastructures at our ports we should also strengthen the regulations of maritime operations in consonance with the upcoming ASEAN integration, said Adoracion M. Navarro, senior research fellow at the Philippine Institute for Development Studies (PIDS).
Navarro said that Mindanao needs deep seaports that can accommodate or allow big international vessels to dock.
For Mindanao, that serves 25 percent of the countrys container traffic, the islands ports must be develop to accommodate big vessels at portside and find ways to decongest existing ports. Navarro said.
Customs Reform Program
One of the focus discussions at the conference was on the newly implemented ruling on accreditation for importers and custom brokers.
Bureau of Customs has recently released a number of policies to rationalize operations and pinpoint gaps between transparency and corruption in trade and customs.
In 12 months, adoption of the load port survey or the pre-shipment inspection on containerized shipments and the implementation of the plan to fully computerize the bureau and other measures are expected.
According to Atty. Agaton Uvero, Deputy Commissioner for Assessment and Operations Coordinating Group of the Bureau of Customs, all importers are to secure BIR importer clearance certificates. For custom brokers, a BIR customs broker clearance from the head office in Quezon City is required. In addition, accreditation from the Bureau of Customs is required. Without the accreditation, they will not be allowed to perform any transaction with BOC.
ASEAN integration
Other topics tackled during the conference is on the challenge and benefits that will be brought along with the ASEAN integration specifically regarding the industrial sector, the weakness and strengths on the economic aspect of Mindanao and shippers and cargo service providers needs.
Businessmen and entrepreneurs convened to strategize and envision a better Mindanao by 2015.
President Aquino also invited everyone to be more aggressive in opportunities brought in by investors in the region. The shipping industry ensures the continued economic and social development in Mindanao and it accelerates the preparation for the coming ASEAN economic community, the President adds.//


Author: Butch D. Enerio
Date: June 20, 2014
Source: Sun Star Cebu

Investing on disaster response and preparation must become a priority to prevent any negative impact on the countrys economic growth and erosion of development gains, according to the National Economic and Development Authority (Neda).
In a news statement at the recent Extraordinary Summit of Heads of State and Government of the Group of 77 and China (G77+China), Economic Planning Secretary and Neda Director General Arsenio M. Balisacan said that in line with this, G77+China must push for a revitalized global-policy framework in disaster preparedness and response.
Without a doubt, natural calamities have become a major consideration in framing our shared goal of sustainability and development. Likewise, the challenges of climate change demand action from all of us, individually and as a group, toward establishing the well-lived society we all want, Balisacan said.
Balisacan also emphasized that even with the Philippine governments efforts, natural calamities, with magnitude such as that of Supertyphoon Yolanda (international code name Haiyan), have negated some of the progress it has made and even pulled back development, especially in the affected areas.
A recent study by the state-owned think tank Philippine Institute for Development Studies (PIDS), quoting data from the National Disaster Risk Reduction and Management Council, showed that disasters that hit the country between 1990 and 2006 cost P20 billion a year, or about 0.5 percent of the country's gross domestic product (GDP).
Further, the PIDS study said an average of 20 cyclones visit the country annually, and at least five of these cyclones take great toll on lives and properties. The respective average annual casualty and damage to properties from these events were 593 dead and P4.6 billion over the past 30 years.
More recently, Tropical Storm Ondoy and Typhoon Pepeng in 2009 caused substantial damages and losses equivalent to about 2.7 percent of the countrys GDP. In 2012 Typhoon Pablo inflicted massive damages in the Southern Philippines, depleting much of the QRF [quick-response funds] and calamity funds of involved executive departments until the succeeding year, PIDS Supervising Research Specialist Sonny Domingo said in the study titled Quick Response Funds and DRRM Resources in the Department of National Defense and Various Departments.
The G77+China, also celebrating its 50th founding anniversary this year, is the largest intergovernmental organization of developing countries in the United Nations (UN).
The group provides developing countries an avenue to articulate and promote collective economic interests and enhance joint negotiating capacity on all major international economic issues within the UN system.
In September UN Secretary-General Ban Ki-moon will convene a Climate Summit alongside the annual General Assembly meeting. The event is aimed at building on momentum ahead of official talks next year, when world leaders will agree on a legally binding treaty that would cut greenhouse-gas emissions.
We commit to advance the G77+Chinas interest and aspirations in the Post-2015 Development Agenda, particularly in its call to scale up existing commitments to eradicate poverty in all its dimensions, achieve equality of opportunities for all and fight climate change, Balisacan said.
Also later this year, the UN Framework Convention on Climate Change will meet in Peru in its last official high-level meeting before the negotiations in Paris in 2015.//

Author: Cai U. Ordinario
Date: June 19, 2014
Source: BusinessMirror

As I handed my payment to the jeepney driver on my way to work, his remark to several of passengers (including me) of Singkwenta pa, singkwenta pa initially confused me. It dawned on me that he was asking us an additional of fifty centavos on top of the usual eight-peso fare instead of fifty more passengers. Jeepney rates have increased! After fumbling around for two twenty five centavos to add to my fare, I sat down thinking silently how prices have risen for the past few years.
It is not just transport prices that have increased but also that of electricity, education and food. Rice prices have been steadily increasing since the start of the year. Looking back at the prices since the start of the Aquino government, regular milled rice prices have soared by at least 20 percent as of April this year when compared to that of July 2010 (according to data from the Bureau of Agricultural Statistics). Since mid-year last year, rice prices have increased by an average of 1.2 percent per month as compared to less than a tenth of a percent (0.04 %) for the same period a year before. Prices have reportedly increased recently by another 2 pesos compared to the said April prices (at 30 pesos per kilo, current prices of regular milled rice is 30 percent greater than that of 2010 prices).
What is worrisome is the still undeclared (but expected by many) El Nio cycle this year. Despite the advent of the rainy season, an El Nino event is expected to reduce the amount of rainfall in general to the country.
The El Nio that transpired more than a decade ago affected Western Luzon, Western Visayas, Northern Samar, and the southern part of Western Mindanao as they experienced less than 40 percent of normal rainfall. The Bureau of Agricultural Statistics (BAS) estimated a decrease of 7.5 percent in agricultural growth during that event. Rice and corn production decreased by almost 24.1percent and 26.6 percent, respectively and damaged 292,000 hectares of corn and rice farm lands in our country.
Around 70 percent of the archipelago suffered from severe drought and the water supply crisis during that time left 27,000 hectares of rice and corn paddies severely damaged. This is equivalent to an estimated loss of 100,000 million metric tons (MMT) of rice and has affected 15,000 farmer households.
Engr. Ronald Garcia, agricultural engineer at AGHAM"Advocates of Science and Technology for the People"estimates that at least 27 percent of rain-fed agricultural lands will be severely affected without irrigation systems in place. In 2000 to 2010, 73 percent or 314,115 MT of the production increase came from irrigated areas while only 27 percent or 113,815 MT came from non-irrigated areas. Productivity of rain-fed upland areas was reported to be declining by around 8000 tons per year since 2000.
Garcia pointed out that we must brace ourselves from the possibility of rice production shortage once the worst of the dry spell hits the country. Prices of rice and corn and other agricultural products are expected to go up due to lower production. He added that a strategic irrigation action plan is one immediate measure that must be in place for the government to prepare for the El Nio event since water will be the outmost concern during that time. During the dry period, irrigation for food production is a critical farm infrastructure that should be prepared for and managed by the government.
What makes things worse for the upcoming El Nino is that our dependence on rice imports severely puts our food security into question. A study by the Philippine Institute for Development Studies (PIDS) by Dr. Roehlano Briones and Ivory Myka Galang blames the mid-2013 rice price increase to the reduction in imports by the government that caused a decrease in supply.
Despite the Department of Agricultures Food Staples Sufficiency Program (FSSP), which aimed to raise domestic rice production, the increase in palay production had not been enough to offset the reduction in imports. The country already imports 1.2 million tons in 2014 according to the UNs Food and Agricultural Organization (FAO) while the US Department of Agriculture estimates this to be more than 2 million tons.
While the PIDS study points to more dependence on rice imports by lifting the quantitative restriction (QR) policy as a solution, a more basic solution would be to implement a thoroughgoing agrarian reform that would include land redistribution (unlike the CARPER system) to tillers, agricultural modernization and integration of the agricultural sector to a domestic industrial regime. Both of these are yet to be realized in our country.
Garcia notes that it should be a lesson to the government that food security and self-sufficiency cannot be realized overnight unless there is necessary support for the farmers such as their own land, subsidies, policies to support to enhance agricultural productivity and upgrade our post-harvest facilities and ways to ensure a market for their produce.
The total wasted funds from the PDAF scam, the fertilizer fund scam, and misuse of the Agricultural Competitiveness Enhancement Fund is a staggering P10.744 billion. This is more than 12 times than the allocation for El Nio contingencies. Such funds should be made available to farmers to allow them to cope with climate variability instead of going into the pockets of those enmeshed in the web of corruption that pervades our government today.//

Author: Giovanni Tapang
Date: June 18, 2014
Source: Manila Times

The price of rice, the Filipino staple food, has soared to P42.50 per kilo, a level seen only during periods of crisis for global rice and other commodities.
The P40/kilo level was last breached in 2008-2009 and earlier, in 1972-1973. But that was because of a global commodity crisis not only for rice, but all agricultural products. It was in turn caused by an oil price surge and the ensuing market panic. No government in the world would dare risk shortfalls in their countrys staple food, so they worsened the situation then by restricting their rice exports.
In the present case, though, it is sheer bungling by the administration of President Aquino. He has claimed, and the yellow media has duly reported, that the Philippines has achieved self-sufficiency in rice.
Aquinos favorite punching bag, former President Arroyo saw rice prices increase in 2008-2009 because of the global commodity crisis. However, prices of the staple during President Arroyos term averaged P34.20 per kilo. The P42.50 per kilo of rice under Aquino today means a huge 25 percent increase.
Aquinos appointee, National Food Authority administrator Lito Banayo in 2011 had even claimed that the previous government had foolishly imported so much rice and made allegations of corruption that he couldnt prove.
The price of rice, the Filipino staple food, has soared to P42.50 per kilo, a level seen only during periods of crisis for global rice and other commodities.
The P40/kilo level was last breached in 2008-2009 and earlier, in 1972-1973. But that was because of a global commodity crisis not only for rice, but all agricultural products. It was in turn caused by an oil price surge and the ensuing market panic. No government in the world would dare risk shortfalls in their countrys staple food, so they worsened the situation then by restricting their rice exports.
In the present case, though, it is sheer bungling by the administration of President Aquino. He has claimed, and the yellow media has duly reported, that the Philippines has achieved self-sufficiency in rice.
Aquinos favorite punching bag, former President Arroyo saw rice prices increase in 2008-2009 because of the global commodity crisis. However, prices of the staple during President Arroyos term averaged P34.20 per kilo. The P42.50 per kilo of rice under Aquino today means a huge 25 percent increase.
Aquinos appointee, National Food Authority administrator Lito Banayo in 2011 had even claimed that the previous government had foolishly imported so much rice and made allegations of corruption that he couldnt prove.


Author: Rigoberto D. Tiglao
Date: June 17, 2014
Source: Manila Times

Philippines and Japanese governments will hold an Industrial Cooperation Dialogue today to boost Japans move to make the Philippines its manufacturing hub in the region.
Trade and Industry Assistant Secretary Rodolfo Severino told reporters that the dialogue aims to advance the existing cooperation between the two countries in three areas.
Foremost is the goal to make the Philippines an investment destination for Japan Industrial Foreign Direct Investments, human development, and to enhance competitiveness of small and medium enterprises.
DTI Undersecretary Adrian S. Cristobal Jr. will spearhead the Philippine side while the Japanese side will be led by Toshiyuki Sakamoto, Deputy Director-General for Trade Policy, Ministry of Economy, Trade and Industry (METI) and Kazumi Nishikawa, Executive Director, JETRO Singapore and Special Advisor to the Minister of METI.
Companies attending the dialogue include Toyota Motors Philippines, Mitsubishi Motors Philippines Corp., Philippine Automotive Federation Inc., IDE-JETRO, Research Institute of Economy, Trade and Industry (REITI), and National Graduate Institute for Policy Studies (GRIPS) of Japan.
There will also be representatives from various Philippine government agencies, including the Philippine Institute for Development Studies, National Economic and Development Authority, Department of Finance, Development Academy of the Philippines, Department of Labor and Employment, Department of Science and Technology, Technical Education and Skills Development Authority, the Automotive-Technical Working Group, Senate, and Congress.//

Author: Bernie Magkilat
Date: June 16, 2014
Source: Manila Bulletin

MANILA, Philippines - The Philippine services sector needs an articulated and comprehensive national strategy to maximize its potentials as a growth engine for the economy.

In the National Workshop on Services organized by state think tank Philippine Institute for Development Studies (PIDS) and the Department of Foreign Affairs (DFA), experts and stakeholders from the private and public sectors underscored the need for a more focused national strategy for services.

The Philippines can be a hub for services trade in Asia Pacific because of its pool of skilled, semiskilled, and low-skilled workers, PIDS Research Consultant Dr. Ramonette Serafica said. The estimated 10.4 million Filipinos abroad are a natural market for Philippine services, she added.

According to Serafica, the country can tap opportunities in maritime, outsourcing, franchising, medical, and educational services. The Philippines can be a home to world-class brands with the internationalization of Philippine franchise brands, she said.

There is a need, however, to boost government support such as in strengthening Philippine participation in international shows, trade missions, and business matching sessions, she said.

Alegria Bing Sibal-Limjoco, vice-chairman of the Philippine Franchise Association, lamented: In last years Philippine participation in international franchise held in Singapore, the country had only a booth while other ASEAN countries had pavilions.

For Doris Magsaysay-Ho, president and CEO of A. Magsaysay Inc., the countrys high-quality talent pool is a competitive services proposition for the global maritime industry. Knowledge of the maritime field using experienced people offers opportunity to develop business outsourcing services for shipping companies, insurance companies, and others, she said.

The Philippine Information Technology - Business Processing Management (IT-BPM) industry, meanwhile, is not only competitive in voice services, said Ana Maria Bongato, executive director for talent development at the IT Business Process Association of the Philippines (IBPAP). A wide range of services such as IT application, engineering, animation, data analytics, and other business process services are offered by the Philippines, she said.

The Philippine IT-BPM industry is ranked second as a global outsourcing destination and is the countrys largest private sector job creator with 900,000 jobs created last year, said Bongato.

Former Health Secretary Dr. Jaime Galvez-Tan said the country can be an international and medical retirement zone. The country can be retirement havens for Northeast Asians, OFWs, and expats, Galvez-Tan said. We can offer spa tourism, alternative, and Filipino traditional medicine to them, he said.

Also, trade in educational services can make an important contribution in enhancing Philippine higher education, said Prof. Tereso Tullao Jr. of De La Salle University. It can lead to harmonization of academic standards and open avenues for regional cooperation in higher education, he said.

Tullao called for higher standards in educational services, noting the small number of accredited programs and lack of faculty qualifications of Philippine higher education institutions (HEIs). Only 21.5 percent of the more than 2,200 HEIs have some form of accreditation and a miniscule 12.7 percent of around 130,000 faculty members have doctoral degrees, he said.

To harness services trade, former PIDS president Dr. Josef Yap stressed the need to have an institutional framework to address cross-cutting issues in services trade such as smuggling, transportation and logistics, skills mismatch, and power.

There is a need to create an institutional setting to coordinate policies required to develop the countrys services capacity through infrastructure development, skills upgrade, support policies and incentives, Yap said.

In relation to this, PIDS president Gilberto Llanto said there is a need for a deeper understanding of the services sector for effective policy measures considering that the sector contributes significantly to the economy. Philippine growth is driven by an expanding services sector which accounts for 57 percent of total GDP, Llanto noted.

It is thus important to guide the direction of the services sector since it contributes positively to the countrys development and job generation agenda, said Laura del Rosario, Foreign Affairs undersecretary for international economic relations.

At the close of the workshop, del Rosario announced the revival of the Philippine Services Coalition, a multi-stakeholder group to be led by the private sector that will campaign for reforms to boost the services sector. The coalition will soon meet to map out its strategic initiatives, she said.

The National Workshop on Services was held in preparation for the Philippines chairmanship of the Asia-Pacific Economic Cooperation (APEC) forum next year, del Rosario said.

The workshop brought together local and international experts and other stakeholders to discuss opportunities in services trade. The output of the workshop will serve as an input toward a comprehensive strategy on services.//

Author:
Date: June 16, 2014
Source: Philippine Star

MANILA, Philippines"Japanese companies are looking to make the Philippines their manufacturing hub in the Asean given the continued robust performance of the Philippine economy, the Department of Trade and Industry said Friday.
Trade Assistant Secretary Ceferino S. Rodolfo told reporters that the Industrial Cooperation Dialogue between the Philippines and Japan, which is being held Monday, is meant to advance the existing cooperation and further boost trade and investment ties between the two countries.
The meeting will look into how the Philippines can be a further viable destination for industrial foreign investments by Japanese firms, for human development, and for enhancing competitiveness of the small- and medium-sized enterprises (SMEs).
High-level trade officials are also expected to discuss how the two countries could synchronize their respective policies to realize that vision of establishing a manufacturing hub in the country.
According to Rodolfo, the Japanese delegation is being led by Toshiyuki Sakamoto, deputy director general for trade policy at the Japanese Ministry of Economy, Trade and Industry (Meti). Also part of the delegation, which would comprise mostly the small and medium enterprises in Japan, is Kazumi Nishikawa, special adviser to the minister at Meti and executive director at the Japan External Trade Organization (Jetro) Singapore.
Representatives from Toyota Japan are also expected to be at the dialogue to share their experiences as to what is really happening in the global automotive industry and how the Philippines can position itself as a development hub in Asean. There is a huge interest in the country right now, Rodolfo added.
The dialogue will be attended by representatives from state-run agencies such as the Philippine Institute for Development Studies, National Economic and Development Authority, Department of Finance, Development Academy of the Philippines, Department of Labor and Employment, Department of Science and Technology, Technical Education and Skills Development Authority, and both houses of Congress.
Also attending the meeting are officials of the Philippine Automotive Federation Inc., Toyota Motor Philippines Co., Mitsubishi Motors Philippines, as well as IDE-Jetro, Research Institute of Economy, Trade and Industry, and the National Graduate Institute for Policy Studies from Japan. //

Author: Amy R. Remo
Date: June 16, 2014
Source: Philippine Daily Inquirer

MANILA, Philippines - Trade officials from Japan and the Philippines are holding a meeting today as part of a series of dialogues to enhance cooperation in making the latter the preferred hub of Japanese firms in Southeast Asia.

Trade assistant secretary Ceferino Rodolfo told reporters the industrial cooperation dialogue between Japan and the Philippines aims to advance the existing cooperation between the two countries specifically on making the latter the preferred destination of Japanese industrial foreign direct investments.

What Japan wants is to really make the Philippines its manufacturing hub in the ASEAN (Association of Southeast Asian Nations), he said.

Rodolfo acknowledged that while there are already many Japanese firms operating in the country, there are still those interested in checking out opportunities here.

The meeting is also expected to help position the Philippines a human development hub in the region as well as enhance the competitiveness of small and medium enterprises.

(Making) the Philippines a human development hub in ASEAN, we also have a big interest in that, Rodolfo said.

The dialogue would be attended by Toshiyuki Sakamoto, Japans Ministry of Economy, Trade and Industry deputy director general for trade policy and Trade undersecretary Adrian Cristobal Jr. as well as Trade assistant secretary Rafaelita Aldaba.

Other Japanese representatives from the Institute of Developing Economies - Japan External Trade Organization, Research Institute of Economy, Trade and Industry, and National Graduate Institute for Policy Studies are expected to be part of the meeting.

Representatives from the Philippine Institute for Development Studies, National Economic and Development Authority, Department of Finance, Development Academy of the Philippines, Department of Labor and Employment, Department of Science and Technology, Technical Education and Skills Development Authority, Senate and the Congress would also be there.//

Author: Louella D. Desiderio
Date: June 16, 2014
Source: Philippine Star

The Philippine Institute of Development Studies (PIDS) has stressed the need for a competition policy for the rice and passenger transport sector to encourage innovation and prevent cartels.
In a recent national reference group meeting, PIDS senior research fellow and Competition Reforms in Key Markets for Enhancing Social and Economic Welfare in Developing Countries (CREW) Project Director Dr. Roehlano Briones cited the importance of adopting a more flexible policy toward rice imports.
There is a competitive market structure for domestic rice production and marketing, but rice import quota which is decided solely by the National Food Authority through the National Food Authority Council could facilitate a cartel-like behavior, Briones said. NFA manages to stabilize retail prices, but keeps domestic prices high by means of an import monopoly.
Briones cited a study by Beulah de la Pea that a few big players in the rice industry are allowed to import a minimum of 2,000 metric tons and a maximum of 5,000 metric tons of rice under the current importation quota distribution.
The study suggests that small players should be allowed to import 10- or 20-ton container load of rice to prevent rice supply monopoly by a few big players.
Quantitative restrictions on imports to support the countrys rice self-sufficiency objective must be repealed, Briones said.
If quantitative restrictions were eliminated and rice imports were allowed to freely come in the country, total rice imports would have reached 3.68 million metric tons, Briones said. Such high level of imports would have brought down the retail price of rice to P21.43 per kilogram and P19.39 per kilogram at the wholesale level.
Last year, the retail price of rice shot up to P36.28 in December from P32.37 in June, he said. It is equivalent to a 12-percent increase in just six months.
Meanwhile, PIDS Research Consultant Debbie Gundaya revealed the market inefficiency in the bus transport sector.
Market inefficiency manifests in too many operators and buses resulting in traffic congestion, she said. There are 1,122 bus operators and 12,595 buses in Manila routes, she said.
Gundaya noted that the bus transport sector market operates under a highly complicated regime where regulation and enforcement is shared by several agencies resulting in implementation failures and regulatory capture.
There is an operation of illegal colorum buses in Manila routes, Gundaya said. Proliferation of kabit system where a bus operator enters the market through an arrangement with an operator with an established franchise is also present.
In reaction to the consultants recommendation to consolidate bus operations in Metro Manila, PIDS Senior Research Fellow Dr. Adoracion Navarro recommended that competitively tendered service contracts or concessions for defined routes be explored.
International transport expert Rene Santiago suggested that contracted trips made on predefined routes and headways should be the basis to pool the revenues and pay bus operators.
The meeting was part of the activities of the three-year project of PIDS, CUTS, and AER on Competition Reforms in Key Markets for Enhancing Social and Economic Welfare in Developing Countries.
The project aims to assess the level of competition in the rice and passenger transport sectors to generate broad-based support, especially from policymakers, for competition reforms.//


Author: Edu Lopez
Date: June 14, 2014
Source: Manila Bulletin

Manila, Philippines " The Commission on Higher Education (CHEd) announced that 287 Private Higher Education Institutions (PHEIs) have been given the go-signal to increase their tuition and other fees this year. The increase will be an average of P35.66 per unit for academic year 2014-2015.

But CHEd said, that the number of schools allowed to implement an increase in tuition fees have actually decreased by four percent. Last year, the petition of tuition fee increases of 354 PHEIs were approved, according to the Office of Student Services and Development of CHEd.

The number of PHEIs that filed for a tuition fee increase this year is also lower " only 345 schools, from 451 in 2013.

The data also showed that only 20 percent of the countrys 1,683 PHEIs filed a petition to increase fees. Only 17 percent (or 287 schools) were approved.

Of the 287 schools, 64 of the PHEIs are in the National Capital Region, 30 in Region XI, and 26 in Region III. The average per unit tuition fee increase in the said regions are 6.05 percent in NCR, or P66.24; 9.33 percent in Region XI, or P36.22; and 9.30 percent in Region III, or P39.42.

The average per unit increase in the three largest regions are: NCR P66.24 (6 percent), IV-A P51.04 (7.35 percent) and III P39.42 (9.3 percent).

For this school year, the nationwide average tuition fee increase per unit is P35.66 (8.13 percent) while the nationwide average increase in other school fees is P141.55 (7.97 percent).

IN YOLANDA AREA

Meanwhile, HEIs in Region VIII " which bore the brunt of Super-Typhoon Yolanda last year " posted no tuition and other fees increase. However, some schools in other Yolanda-affected regions including Region VI and VII were allowed to implement increase in fees.

In Region VI, 24 out of the 25 HEIs that applied for tuition increase were approved, while in Region VII, 13 out of 15 HEIs were also given approval.

CHEd said that there are around 3.43 million students at the tertiary level with 41 percent of 1.40 million are in public HEIs while 59 percent or 2.03 million are in private HEIs.

Earlier, CHEd Chairperson Patricia Licuanan said the HEIs that have been approved to increase tuition complied with the requirements. Tuition increase, she explained, is a balancing act where the interests of both parties " schools and students " are carefully weighed.

Since tuition increase might be inevitable due to changing factors that affect the education sector, Licuanan advised students and parents to become good consumers of higher education. Students and parents should try to have a better understanding about the cost of education for them to be informed and come up with real choices, she said.

With the help of the Philippine Institute for Development Studies, Licuanan said that CHEd has started developing a systematic, data-based, broadly acceptable framework for TOSF to guide the agency in deciding on a reasonable rate of increase each year.//

Author: Ina Hernando Malipot
Date: June 13, 2014
Source: Manila Bulletin

MANILA, Philippines - Almost 300 private tertiary schools nationwide, excluding those in the Autonomous Region in Muslim Mindanao, will increase their tuition and other fees for academic year 2014-2015, the Commission on Higher Education (CHED) said in its latest report.

Of the 345 higher education institutions (HEIs) that applied for a hike in tuition and other school fees, 287 or 17 percent were approved by CHED.

The body, however, said the number of private HEIs raising their tuition and other school fees was lower by four percent (67 HEIs) than last school year.

There are a total of 1,683 private HEIs nationwide. The National Capital Region (NCR) and Regions 4A (Calabarzon) and 3 (Central Luzon) have the most number of HEIs with 308, 230 and 202, respectively.

The nationwide average tuition increase per unit for this school year is P35.66 or 8.13 percent, while the nationwide average increase in other school fees is P141.55 or 7.97 percent.

Out of 69 HEIs that applied for tuition increase in NCR, 64 were cleared while CHED allowed 25 out of 46 schools in Region 4A and 26 out of 39 in Region 3 to raise fees.

CHED said the average per unit tuition increase in the three largest regions are as follows: NCR, P66.24 (six percent); Region 4A, P51.04 (7.35 percent); and Region 3, P39.42 (9.3 percent).

The highest average tuition increases were posted in Regions 4B (Mimaropa), 2 (Cagayan Valley) and 1 (Ilocos) with P55.60 (13.90 percent), P39.41 (13.53 percent) and P37.28 (12.99 percent), respectively.

CHED said there are no colleges and universities in Region 8 (Eastern Visayas), which was hardest-hit by Super Typhoon Yolanda last November, that will raise tuition this year.

CHED, in collaboration with the Philippine Institute for Development Studies, has started developing a systematic, data-based, broadly acceptable framework for tuition and other school fees to guide the agency in deciding on a reasonable rate of increase each year.

CHED website hacked

The website of CHED, meanwhile, was inaccessible yesterday after it was apparently hacked on Wednesday night by a group that pointed out security vulnerabilities.

Admin please strengthen your security. Your site is not secure You need to secure it, read the message that was posted on the agencys home page before it was taken down.

The CHED website remained inaccessible as of yesterday afternoon.

The hackers claimed to have come from Turkey, and are part of the group behind the website antisecurityteam.com.

The attack appears to be unrelated to the protest action launched yesterday in connection with the pork barrel scam.

Hacker group Anonymous Philippines, which defaced a number of websites during the Million People March in August last year, has not issued any statement regarding defacement of government websites.

During the Million People March, Anonymous claimed that more than 30 websites " including that of the Optical Media Board, Komisyon sa Wikang Filipino and the National Historical Commission of the Philippines " were defaced.

Roy Espiritu of the Information and Communications Technology Office earlier said they were working hard to keep the sites operational.

He said government websites are currently in the process of migrating into more secure servers as mandated by Administrative Order 39, signed by the President last year, which establishes a government web hosting service.

The service seeks to ensure the governments Internet presence 24 hours a day, 7 days a week under all foreseeable conditions.//


Author: Janvic Mateo
Date: June 13, 2014
Source: Philippine Star

A new study that addresses jobs expansion and development strategy was recently completed at the government think tank, the Philippine Institute for Development Studies (PIDS ).
The authors (Vicente Paqueo, Aniceto Orbeta, Leonardo Lanzona and Dean Dulay) of the study are all Filipino economists who have worked on labor market issues for prolonged periods. Dr. Paqueo, who used to teach with the U.P. Economics faculty had a career at the World Bank. Dr. Orbeta is a fellow at PIDS, and Dr. Lanzona is with the Ateneo Economics faculty.

The PIDS study. The major purpose of the study is to find ways to improve the expansion of jobs in the Philippine economy. The subject has many dimensions. The roots of the problem has to be investigated and sound evidence has to be provided.

Labor laws and regulations have been devised to protect labor from abuses by employers and to improve the power of labor to bargain for decent wages and working conditions.

Practices and regulations in the labor market are focused on minimum wage mandates, labor regulations concerning hiring and firing of workers.

Such practices have their costs. They render the labor market less flexible. For instance, long conflict resolution processes raise the cost of employment. Potential negative effects of these policies could defeat the objectives of improving labor welfare.

In other economies where the minimum wage has been adopted, the level of the government orders on the minimum wage did not impinge on the employment objective because their wage orders were minimal and not high.

Not so with us. Philippine minimum wage policy has been the object of a lot of attention because, from the very start, government minimum wage mandates have been high. They were made to carry the burden of raising wages for workers.

Because of the critical role played by minimum wage policy in setting wages for workers in the country, the first order of business of the study was to focus on the evidence concerning minimum wages.

Last week, a seminar on this study was organized at the AIM (Asian Institute of Management) Business Policy Center in Makati. I agreed to react to the study and here below are some of the comments I made.

Minimum wage and employment: the overall effects. The studys findings support many of the points that I have been saying for ages about the ill effects on employment and on our development performance!
Their findings reinforce the conclusions of economic analysis based on the countrys large labor supply. Aggressive minimum wage rates increases have led to reduction in employment, making households dependent on wage incomes suffer significant drops in their welfare, some falling into poverty.

Such detailed findings are now possible because there is much more body of statistical data available. The statistics include labor force surveys; surveys of business enterprises; and more specific household income and poverty incidence panel data.

Research methodologies have also improved. Imaginative ways to link demographic characteristics with other wage variables have led to micro studies that focus on the impact of employment on firms and on household welfare.

Minimum wage and business enterprises. The first major finding is that when minimum wages are raised, business enterprises reduce their hiring of labor. (The rise in minimum wages has often meant significant increases in the daily wage rates and/or in wage benefits as mandated by government orders.)

The study finds a significant negative relationship between minimum wage and the number of production workers employed. Thus, minimum wage changes reduce employment.

In addition, further investigation on the impact on production workers have shown that the most vulnerable groups " the young, less educated and inexperienced workers " suffer most from these observed relationships.

Minimum wage and increasing household poverty. Another quite important finding is that minimum wages have aggravated the adverse income shocks to poor families and have contributed to the increase in poverty among the already poor.

This outcome is true for families dependent on industrial incomes and also for those on agricultural wage incomes. The study finds that rapid increases in either industrial or agricultural minimum wage leads to a reduction of household income.

Links to early studies of low employment impact of economic growth. The results of the study validate many early findings associated with high minimum wage policy on employment and on labor welfare. These have been stated more or less in terms of other policy issues affecting employment and incomes.

Low employment creation is associated with Philippine economic growth. This poor performance is related to economic policies that promoted protection and import substitution in the past. Past industrial policies led to uncompetitive industries and to the allocation of labor and capital in highly protected policies with low productivity.

One way of interpreting such an outcome is through poor total factor productivity of Philippine growth performance compared to those of many East Asian neighbors. Jobless growth is also as much a description of this poor quality of performance in which growth was accompanied by low creation of quality jobs.

The army of under-productive and poor workers. At the outset of the study, the authors constructed a table of full-time equivalent low income workers who are either employed or underemployed, who receive very low incomes or who are unemployed. Most of these work in the informal sector of the economy where income is very low.

Such workers constitute what the authors call under-productive workers and they turn out to be very significant.

This under-class of low income workers grew from 13.9 million in 2001 to 20.7 million workers in 2011. I would call this the labor surplus that cannot be absorbed into gainful jobs that support a decent living standard.

What is more significant is that this class of low income workers has been growing at an average of 4.5 percent based on the numbers that they have calculated, even more than twice the growth of the Philippine population (!).

As a percent of the population in 2011 of 93 million, it comes out as more than one-fifth of the countrys population.

The implication of this is massive. The countrys job creation program has been falling behind. The reason is that we are stuck with a wrong policy that fails to promote employment!//

Author: Gerardo P. Sicat
Date: June 11, 2014
Source: Philippine Star

Just as new Palace Assistant on Food Security Francis Pangilinan strives to snuff out the coconut scale-insect infestation, another fire breaks out. The burning issue is Vietnams failure to deliver last May 200,000 tons of rice to the Philippines. Thus looms a repeat of the rice shortage and price surge of June 2013.
Vietnam is renegotiating with the Philippines its delivery deadlines of 800,000 tons that the Philippines purchased in April. Its two state-owned grains enterprises, Vinafood-I and -II, cannot gather enough stocks from farmers. To be moved back are shipments of 200,000 tons per month, May to Aug.
Oryza.com, a website that tracks global grains trade, cites two general reasons for Vietnamese farmers disinterest: the buying price is too low, and the conditions too steep (see http://oryza.com/news/rice-news/vietnam-discuss-change-delivery-dates-ph...).
But sources inside the Philippines National Food Authority detail the problem. The NFA is imposing impossible quality standards " to mask the overpricing of rice imports in 2013. It is also imposing on Vinafood-I and -II a single favored cargo handler " to mask the overpricing of such services at present.
Last March the NFA bid out the supply of 800,000 tons of well-milled, long-grained white rice, 15 percent broken. This was a major departure from the usual imports of ordinary white rice, 25 percent broken. Thats so graft busters will be unable to compare apples and oranges, insiders say. Agriculture Sec. Proceso Alcala and NFA administrator Orlan Calayag have been accused of plunder, in the P3.4-billion overprice of 702,500 tons of Vietnam rice last year.
In the bidding the NFA redefined long-grained, from the global standard of 6.2-6.9 mm to only 6.5-6.9 mm. This drove away private Thai bidders, leaving only Vinafood. It was with Vinafood that a Filipino businessman brokered for the NFA, according to accuser lawyer Argee Guevarra.
On top of all this, the NFA required Vinafood-I and -II to hire its single accredited cargo handler, at $30 per ton more than market rates. This overprice is estimated at P1.08 billion, given the 800,000-ton volume and the P45:$1 exchange rate (see Gotcha, 21 May 2014).
Though the Vietnamese agencies reportedly grumbled, they had no choice. As of mid-May the cargo handler was increasing its service fee (see Gotcha, 23 May 2014). With delivery deadline only two weeks away, they were under the gun.
About that time was Pangilinan appointed presidential assistant, to solve the crises in rice, coconut, irrigation, fertilizers and pesticides.
This month last year NFA rice retail prices zoomed 50 percent from P25 to P38 a kilo, ironically right after the bumper harvest of April-May. Alcala blamed it on cartelists-price manipulators.
But state think tank Philippine Institute for Development Studies traced the problem to NFA underestimation of import needs (see http://oryza.com/news/rice-news/philippines-rice-prices-surge-reduced-im...). PIDS said Alcala mistakenly forecast rice self-sufficiency, a hope dashed by one typhoon in July.
While this years 800,000-ton imports may be more, late delivery could result in domestic shortage.//

Author: Jairus Bondoc
Date: June 11, 2014
Source: Philippine Star

The Philippine services sector needs an articulated and comprehensive national strategy to maximize its potentials as a growth engine for the economy.

In the National Workshop on Services organized by state think tank Philippine Institute for Development Studies (PIDS) and the Department of Foreign Affairs (DFA), experts and stakeholders from the private and public sectors underscored the need for a more focused national strategy for services.

The Philippines can be a hub for services trade in Asia Pacific because of its pool of skilled, semiskilled, and low-skilled workers, PIDS Research Consultant Dr. Ramonette Serafica said. The estimated 10.4 million Filipinos abroad are a natural market for Philippine services, she added.

According to Serafica, the country can tap opportunities in maritime, outsourcing, franchising, medical, and educational services. The Philippines can be a home to world-class brands with the internationalization of Philippine franchise brands, she said.

There is a need, however, to boost government support such as in strengthening Philippine participation in international shows, trade missions, and business matching sessions, she said. Alegria Bing Sibal-Limjoco, vice-chairman of the Philippine Franchise Association, lamented: In last years Philippine participation in international franchise held in Singapore, the country had only a booth while other ASEAN countries had pavilions.

For Doris Magsaysay-Ho, president and CEO of A. Magsaysay, Inc., the countrys high-quality talent pool is a competitive services proposition for the global maritime industry. Knowledge of the maritime field using experienced people offers opportunity to develop business outsourcing services for shipping companies, insurance companies, and others, she said.

The Philippine Information Technology " Business Processing Management (IT-BPM) industry, meanwhile, is not only competitive in voice services, said Ana Maria Bongato, executive director for talent development at the IT Business Process Association of the Philippines (IBPAP). A wide range of services such as IT application, engineering, animation, data analytics, and other business process services are offered by the Philippines, she said.

The Philippine IT-BPM industry is ranked second as a global outsourcing destination and is the countrys largest private sector job creator with 900,000 jobs created last year, said Bongato.

Former health secretary Dr. Jaime Galvez-Tan said the country can be an international and medical retirement zone. The country can be retirement havens for Northeast Asians, OFWs, and expats, Galvez-Tan said. We can offer spa tourism, alternative, and Filipino traditional medicine to them, he said.

Also, trade in educational services can make an important contribution in enhancing Philippine higher education, said Prof. Tereso Tullao Jr. of De La Salle University. It can lead to harmonization of academic standards and open avenues for regional cooperation in higher education, he said.

Tullao called for higher standards in educational services, noting the small number of accredited programs and lack of faculty qualifications of Philippine higher education institutions (HEIs). Only 21.5 percent of the more than 2,200 HEIs have some form of accreditation and a miniscule 12.7 percent of around 130,000 faculty members have doctoral degrees, he said.

To harness services trade, former PIDS president Dr. Josef Yap stressed the need to have an institutional framework to address cross-cutting issues in services trade such as smuggling, transportation and logistics, skills mismatch, and power.

There is a need to create an institutional setting to coordinate policies required to develop the countrys services capacity through infrastructure development, skills upgrade, support policies and incentives, Yap said.

Moreover, the national vision or strategy on promoting the service sector should be anchored on a higher order objective which is the pursuit of inclusive growth for the country, said NEDA deputy director-general Emmanuel Esguerra.

In relation to this, PIDS President Gilberto Llanto said there is a need for a deeper understanding of the services sector for effective policy measures considering that the sector contributes significantly to the economy. Philippine growth is driven by an expanding services sector which accounts for 57 percent of total GDP, Llanto noted.

It is thus important to guide the direction of the services sector since it contributes positively to the countrys development and job generation agenda, said Laura del Rosario, Foreign Affairs undersecretary for international economic relations.

At the close of the workshop, del Rosario announced the revival of the Philippine Services Coalition, a multi-stakeholder group to be led by the private sector that will campaign for reforms to boost the services sector. The coalition will soon meet to map out its strategic initiatives, she said.

The National Workshop on Services was held in preparation for the Philippines chairmanship of the Asia-Pacific Economic Cooperation (APEC) forum next year, del Rosario said.

The workshop brought together local and international experts and other stakeholders to discuss opportunities in services trade. The output of the workshop will serve as an input toward a comprehensive strategy on services.//

Author:
Date: June 10, 2014
Source: PIA

-- A competition policy for the rice and passenger transport sector is needed to encourage innovation and prevent cartels.

This was stressed in a national reference group meeting organized by state think tank Philippine Institute for Development Studies (PIDS) with the Consumer Unity and Trust Society (CUTS) International based in Jaipur, India, and the Action for Economic Reforms (AER) and attended by various sector leaders.

PIDS Senior Research Fellow and Competition Reforms in Key Markets for Enhancing Social and Economic Welfare in Developing Countries (CREW) Project Director Dr. Roehlano Briones stressed that a more flexible policy toward rice imports should be adopted.

There is a competitive market structure for domestic rice production and marketing, but rice import quota which is decided solely by the National Food Authority through the National Food Authority Council could facilitate a cartel-like behavior, Briones said. NFA manages to stabilize retail prices, but keeps domestic prices high by means of an import monopoly.

Briones cited a study by Beulah de la Pea that a few big players in the rice industry are allowed to import a minimum of 2,000 metric tons and a maximum of 5,000 metric tons of rice under the current importation quota distribution. The study suggests that small players should be allowed to import 10- or 20-ton container load of rice to prevent rice supply monopoly by a few big players.

Quantitative restrictions on imports to support the countrys rice self-sufficiency objective must be repealed, Briones said.

If quantitative restrictions were eliminated and rice imports were allowed to freely come in the country, total rice imports would have reached 3.68 million metric tons, Briones said. Such high level of imports would have brought down the retail price of rice to PHP21.43 per kilogram and PHP19.39 per kilogram at the wholesale level.

Last year, the retail price of rice shot up to PHP36.28 in December from PHP32.37 in June, he said. It is equivalent to a 12-percent increase in just six months.

Meanwhile, PIDS Research Consultant Debbie Gundaya revealed the market inefficiency in the bus transport sector.

Market inefficiency manifests in too many operators and buses resulting in traffic congestion, she said. There are 1,122 bus operators and 12,595 buses in Manila routes, she said.

Moreover, Gundaya described that the bus transport sector market operates under a highly complicated regime where regulation and enforcement is shared by several agencies resulting in implementation failures and regulatory capture.

There is an operation of illegal or colorum buses in Manila routes, Gundaya said. Proliferation of kabit system where a bus operator enters the market through an arrangement with an operator with an established franchise is also present.

In reaction to the consultant's recommendation to consolidate bus operations in Metro Manila, PIDS Senior Research Fellow Dr. Adoracion Navarro recommended that competitively tendered service contracts or concessions for defined routes be explored.

Moreover, International transport expert Rene Santiago suggested that contracted trips made on predefined routes and headways should be the basis to pool the revenues and pay bus operators.

The meeting is part of the activities of the three-year project of PIDS, CUTS, and AER on Competition Reforms in Key Markets for Enhancing Social and Economic Welfare in Developing Countries or CREW. The project aims to assess the level of competition in the rice and passenger transport sectors to generate broad-based support, especially from policymakers, for competition reforms.//

Author:
Date: June 10, 2014
Source: PIA

MANILA, June 9 -- The Philippines successfully hosted the first National Workshop on Services: Advancing Philippines Services Sectors in the Asia-Pacific Region and the 21st Century Global Economy from June 2 to 4 at the Asian Institute of Management in Makati.

The Workshop was co-hosted by the Department of Foreign Affairs Office of the Undersecretary for International Economic Relations " APEC National Secretariat and the Philippine Institute for Development Studies (PIDS), in partnership with the International Trade Centre (ITC) in Geneva and the United States Agency for International Development (USAID).

The Workshop brought together local and international experts from multilateral institutions, think-tanks, national agencies, business and other organizations such as the World Trade Organization (WTO), ITC, APEC, ASEAN, ADB, among others to share their views and analysis on the latest developments and opportunities in the trade in services.

In preparation for the Philippines discussion of services during its chairmanship of the Asia-Pacific Economic Cooperation (APEC) Forum in 2015, the Workshop served as a substantive input to the development of a comprehensive and long-term strategy to promote and maximize the potential of the Philippines services sectors in the global economy, including through the revitalization of the Philippine Services Coalition (PSC).

On June 4, public and private stakeholders gathered together to begin the road towards a comprehensive services strategy for the Philippines, The partnership between the Philippines, through the National Competitiveness Council, and the International Trade Centre on the development and promotion of the countrys services agenda was also reaffirmed.

Services trade has long been recognized by APEC member economies as an important driver of global economy. In the Philippines, the services sector expanded by 7.1 percent in 2013, contributing to the overall GDP growth of 7.2 percent. In 2013, services accounted for 57 percent of total GDP.

Recognizing the competitive advantages of the Philippines, particularly its pool of talented and skilled people, including the estimated 10.4 million Filipinos abroad, the Workshop concluded that the Philippines can be the heart of services trade in the Asia Pacific. (DFA)//

Author:
Date: June 09, 2014
Source: PIA

MANILA, June 9 -- TThe Philippines successfully hosted the first National Workshop on Services: Advancing Philippines Services Sectors in the Asia-Pacific Region and the 21st Century Global Economy from June 2 to 4 at the Asian Institute of Management in Makati.

The Workshop was co-hosted by the Department of Foreign Affairs Office of the Undersecretary for International Economic Relations " APEC National Secretariat and the Philippine Institute for Development Studies (PIDS), in partnership with the International Trade Centre (ITC) in Geneva and the United States Agency for International Development (USAID).

The Workshop brought together local and international experts from multilateral institutions, think-tanks, national agencies, business and other organizations such as the World Trade Organization (WTO), ITC, APEC, ASEAN, ADB, among others to share their views and analysis on the latest developments and opportunities in the trade in services.

In preparation for the Philippines discussion of services during its chairmanship of the Asia-Pacific Economic Cooperation (APEC) Forum in 2015, the Workshop served as a substantive input to the development of a comprehensive and long-term strategy to promote and maximize the potential of the Philippines services sectors in the global economy, including through the revitalization of the Philippine Services Coalition (PSC).

On June 4, public and private stakeholders gathered together to begin the road towards a comprehensive services strategy for the Philippines, The partnership between the Philippines, through the National Competitiveness Council, and the International Trade Centre on the development and promotion of the countrys services agenda was also reaffirmed.

Services trade has long been recognized by APEC member economies as an important driver of global economy. In the Philippines, the services sector expanded by 7.1 percent in 2013, contributing to the overall GDP growth of 7.2 percent. In 2013, services accounted for 57 percent of total GDP.

Recognizing the competitive advantages of the Philippines, particularly its pool of talented and skilled people, including the estimated 10.4 million Filipinos abroad, the Workshop concluded that the Philippines can be the heart of services trade in the Asia Pacific. (DFA)//

Author:
Date: June 09, 2014
Source: PIA

THE national government spends an average of over P2 billion a year for the purchase and maintenance of its vehicles, according to a study released by the Philippine Institute for Development Studies (PIDS).

In a study, titled Purchase or Lease of All-Purpose Vehicle for Government Offices, the Department of Budget and Management (DBM) said between 2007 and 2011, the government spent a total of P12.12 billion, or an average of around P2.42 billion, a year for transportation equipment.

During that period, the government spent the most on transportation equipment in 2009, when it spent P4.54 billion to purchase and maintain vehicles. The government spent the least for vehicles in 2007, when it coughed up a total of P1.38 billion. In 2010 the government spent P2.1 billion, and in 2011 it spent P1.58 billion for transportation equipment.

As a percentage share of the national procurement budget and total capital outlays, government purchase of transportation equipment for the years 2007 to 2011 ranges from 0.6 percent to 1.3 percent, and 1 percent to 2.1 percent, respectively. In the last two years, however, this has gone up, accounting for 2.3 percent to 4.4 percent of the total capital outlays, the DBM said.
Add to that is the cost of operating and maintaining the fleet. Available general data on MOOE [Maintenance and Other Operating Expenses] from the DBM, however, do not specifically reflect or indicate the costs of repairing and maintaining transportation equipment, which are likely to jack up over the years as the vehicles age and the warranties lapse, it added.

To maximize the governments spending for vehicles, the DBM study recommended that the government explores leasing for high-end vehicles and purchasing for low-end vehicles. The DBM added that for domestic vehicles, outright purchases would be more beneficial than leasing, regardless of technical specifications.

These were some of the findings of the study, which used the Net Present Value method, an accepted basis for determining the most desirable investment alternative. The positive net present values obtained will ensue if the net salvage value of the assets exceeds the extra operating costs of owning, or the purchase price, less depreciation tax savings, is less than the burden of the lease payments, the study stated. The latter appears to be truer in this case, as accumulated cost of renting in the country has been shown to be much higher than cost of owning a vehicle.

Data showed that the total government fleet, including local government units and government-owned corporations, is composed of 72,204 vehicles as of 2012. This is equivalent to about a percent of the total number of registered motor vehicles in the country. DBM data also showed that government vehicles accounted for less than 2 percent of the total number of motor vehicles in the country from 2000 to 2012. The DBM added that the governments purchase of motor vehicles has remained relatively unchanged. From 6,623 new units in 2000, the purchase of new vehicles in 2012 totaled 6,456, supporting an earlier observation of a somewhat stable purchasing trend. //

Author: cai
Date: June 08, 2014
Source: BusinessMirror

The Philippine Institute of Development Studies (PIDS) has stressed the need to enhance the countrys human capital in order to increase its competitiveness in exporting services. In a presentation during a national workshop on services, PIDS director Josef Yap said that government support can be used to make universities assume a more proactive role in designing curricula that caters to the needs of the growing market. Yap said the government can also collaborate with the private sector to develop skills tailored to the needs of both existing and future businesses. He also pushed for the establishment of sectoral fund and training levy to bolster resources. Yap underscored the need to further improve domestic training institutions, form partnerships with countries which can provide professionals and ensure no discrimination in terms of hiring and remuneration of foreign professionals vis-a-vis local ones. (EHL)

Author:
Date: June 08, 2014
Source: Manila Bulletin

This years winners of the Metrobank Foundation Search for The Outstanding Philippine Soldiers (TOPS) will officially be announced to the public in a press conference to be held at the General Headquarters of the Armed Forces of the Philippines at Camp Aguinaldo on June 16, 2014 highlighting the 116th celebration of the Philippine Independence. The winners will be presented to AFP Chief of Staff General Emmanuel T. Bautista AFP and other members of the AFP during the flag raising ceremony. In partnership with the Rotary Club of Makati Metro (RCMM), the search process culminated with the final interview of the twenty (20) finalists last May 22-23, 2014 with Sen. Juan Edgardo Sonny M. Angara heading the multi-sectoral panel of judges. The other members of the final board are: Hon. Mujiv Sabbihi Hataman, regional governor of ARMM; Atty. Alexander A. Padilla, president and CEO of Philippine Health Insurance Corporation (PhilHealth); Atty. Theodore Te, Assistant Court Administrator and Chief of Public Information Office of the Supreme Court of the Philippines; Therese Gang Badoy Capati, Founder and Executive Director of Rock Ed Philippines; and Ed Lingao, Director for Multimedia of the Philippine Center for Investigative Journalism. The members of the preliminary board of judges for the commissioned officers are Dr. Enrique A. Tayag, Assistant Secretary of the Department of Health; Dr. Gilberto M. Llanto, president of the Philippine Institute of Development Studies (PIDS); Cherie Mercado-Santos, senior anchor of TV5; and Zak Yuson, director of Move.PH of Rappler. Meanwhile, comprising the preliminary board of judges for the enlisted personnel are Hon. Jose Manuel S. Mamauag, Commissioner of the Commission on Human Rights; Conchita Ragragio, executive director of the Corporate Network for Disaster Response, Jose "Jay" R. Taruc III, TV host and reporter of GMA News and Public and Affairs.

Author:
Date: June 06, 2014
Source: Rappler

The National Economic and Development Authority said the government should open up the services sector to achieve its potential for growth and employment generation.
Neda deputy director-general Emmanuel Esguerra said the Philippines was considered as having one of the most restrictive policy regimes for services, with the highest degree in professional services.
Moreover, the services sector is faced with challenges such as low levels of productivity, employment vulnerability in most services subsectors, and continued concentration of the sectors gross value added in certain regions, particularly the National Capital Region and Region IV-A, Esguerra said during the National Workshop on Services at the AIM Conference Center in Makati City on June 2.
He said aside from measures that limited market access, restrictive measures were also present in the nature of balance sheet requirements as in the Retail Trade Law of 2000 or limits in the number of branches or franchises.
Local governments also impose regulations that affect the efficient supply of services, he said. Anti-competitive business practices also occur even with existing regulations, he added.
Esguerra, citing a number of approaches identified in a policy paper titled Formulating the Philippine services strategy for inclusive growth prepared by the Philippine Institute for Development Studies, said the national services roadmap should include domestic policy reforms, innovations, export promotion and trade negotiation strategies.
Among the important domestic policy reforms are the rationalization of the educational system to adapt to the ever changing requirements dictated by the rapidly changing or evolving technologies. Operationally, better government coordination is critical especially among agencies in charge of policy and regulation, he said.
To promote innovation, services providers must be organized into a consortium to realize synergies. Among export promotion strategies, shared service facilities must be provided to serve as vehicles for marketing, networking, market research and client matching, the Neda official said.
Among trade negotiation strategies is the negotiation of Mutual Recognition Arrangements and similar international instruments for accreditation and recognition, he said.//

Author: Julito G. Rada
Date: June 07, 2014
Source: Manila Standard Today

From the National Economic and Development Authority

There is a need for a more decisive, innovative, and strategic approach to further open up the Philippine services sector to realize its potential for growth and employment generation, according to the National Economic and Development Authority (NEDA).

This statement was made by Secretary of Economic Planning Arsenio M. Balisacan, in an opening speech read by NEDA Deputy Director-General Emmanuel F. Esguerra, during the National Workshop on Services at the AIM Conference Center in Makati City on June 2, 2014.

Overall, the fast growing industry sector, the growing middle-income class, the continued strong inflow of Overseas Filipinos (OF) remittances as well as the increasing number of skilled Filipinos boost the demand for services sector and this bodes well for the growth of our economy, said Balisacan.

Balisacan said that a number of strategies have been identified in the Updated Philippine Development Plan 2011-2016 that will further strengthen the services sector. The Updated Plan articulates the Philippine governments pursuit of inclusive growth. Apart from attaining the prerequisites for rapid and sustained growth such as sound macroeconomic fundamentals and capital accumulation, it aims to broaden the basis and spread the benefits of such growth by improving peoples access to opportunities through investments in physical connectivity and human capital.

The government shall remain focused on its policy commitments, and shall constantly engage the private sector to help realize substantial gains from available opportunities, including the fast- approaching ASEAN Economic Community (AEC), the cabinet official reiterated.

In a separate session of the same event, Esguerra noted that the services sector has the potential to contribute to inclusive growth through two channels. First is through employment and export earnings and second is through the economic transformation made possible by the critical inter-sectoral linkages they provide.

Transport and logistics services facilitate movement of people and goods; retail and wholesale trade connects producers to consumers; business services improve product quality and reduce firms operating costs; financial services direct resources from surplus units (savings) to deficit units (investment); telecommunications reduce the cost of sharing information. With respect to the thrust on human capital investment, education and health services raise the productivity of the work force, he explained.

Both officials acknowledged the need for a comprehensive services strategy that will address challenges in the sector. Esguerra emphasized that such a strategy can only emanate from a full appreciation of what the pursuit of inclusive growth in the present context implies for services.

Esguerra said that the strategy needs to address several challenges in the sector to make it competitive, to spur growth in other sectors, and generate quality employment.

The Philippines is considered as having one of the most restrictive policy regimes for services, with the highest degree in professional services. Moreover, the services sector is faced with challenges such as low levels of productivity, employment vulnerability in most services subsectors, and continued concentration of the sectors gross value added (GVA) in certain regions, particularly the National Capital Region and Region IV-A, said Balisacan, who is also NEDA Director-General.

Aside from measures that limit market access, Esguerra added that restrictive measures are also present in the nature of balance sheet requirements as in the Retail Trade Law of 2000 or limits in the number of branches or franchises. Local governments also impose regulations that affect the efficient supply of services. In addition, anti-competitive business practices also occur even with existing regulations.

Citing a number of approaches identified in a policy paper titled Formulating the Philippine services strategy for inclusive growth prepared by the Philippine Institute for Development Studies (PIDS), he said that the national services roadmap must include domestic policy reforms, innovations, export promotion, and trade negotiation strategies.

Among the important domestic policy reforms are the rationalization of the educational system to adapt to the ever changing requirements dictated by the rapidly changing or evolving technologies. Operationally, better government coordination is critical especially among agencies in charge of policy and regulation, he said.

To promote innovation, services providers must be organized into a consortium to realize synergies. Among export promotion strategies, shared service facilities must be provided to serve as vehicles for marketing, networking, market research and client matching. One might also add deliberately engaging the Filipino diaspora and tapping this huge market for Philippine services. Among trade negotiation strategies is the negotiation of Mutual Recognition Arrangements (MRAs) and similar international instruments for accreditation and recognition, he added.

Balisacan and Esguerra reiterated that there must be a demonstrated synergy of efforts among the various stakeholders and government, for the pursuit of a comprehensive services strategy to be realized.//


Author:
Date: June 06, 2014
Source: Philippine Official Gazette

THE GOVERNMENT says a more comprehensive strategy is needed in order to for the Philippine service sector to fulfill its growth potential.

Citing "Formulating the Philippine Services Strategy for Inclusive Growth," a policy paper by the Philippine Institute of Development Studies, National Economic Development Authority (NEDA) Director-General Arsenio M. Balisacan said that domestic policy reforms, innovation, export promotion, and trade negotiation strategies are needed in order to maximize the service sector's growth.

"The Philippines is considered as having one of the most restrictive policy regimes for services," said Mr. Balisacan in a statement from NEDA on Friday, based on his remarks for the National Workshop on Services, held in Makati City on Monday.

The NEDA chief said that the service sector also faces low productivity, employment vulnerability, and concentration of the work force in the National Capital Region and Calabarzon.

NEDA Deputy-Director General Emmanuel F. Esguerra also noted restrictive provisions in Philippine laws and local government regulations as barriers to a continuous and efficient supply of services.

Mr. Balisacan said service providers could organize themselves into a consortium to encourage synergy. He also urged the negotiation of mutual recognition agreements and other international agreements to ease the movement of Filipino migrant workers to other parts of the world.

Improved coordination among government agencies would also help in policy enforcement for the service sector, he said.

Mr. Esguerra noted that the service sector's contribution to the economy comes in two ways: in their employment and export earnings, and in their inter-sectoral linkages that lead to economic transformation.

Mr. Balisacan promised that the government shall remain focused on its policy commitments to improve the economy. "It shall constantly engage the private sector to help realize substantial gains from available opportunities, including the fast- approaching ASEAN Economic Community," he added. --

Author: Benise Chiara P. Balaoing,
Date: June 06, 2014
Source: BusinessWorld

Tourism industry stakeholders are taking advantage of Thailands political crisis to draw attention to the Philippines as an alternative destination for medical care and wellness. "The situation in Thailand will prompt the market to look for alternative destinations," Tourism Congress of the Philippines executive vice president Cesar Mario Mamon told InterAksyon.com. But there is no guarantee that we will be the preferred destination, he said, adding that this is where niche marketing can play a role. "Our areas of expertise are dental, cosmetic, health and wellness and eye care. Hopefully we can capitalize on these distinct areas of medical tourism," Mamon said. Tourism Secretary Ramon Jimenez said the Philippines has enjoyed a spike in surgery for orthopedics because of Thailands strife.

"People who are travelling [to the Philippines] with foreign passports have sought treatment in the Philippines. Now I should qualify that could include Filipino-Americans," Jimenez told a reporters during a recent press conference. According to the Philippine Institute of Development Studies (PIDS), the worlds top destinations for medical tourism are Thailand, Singapore, US, India, Malaysia, Hungary, Poland, Slovenia, Jordan, UK, the Philippines, Germany, South Korea, Taiwan and Belgium. Taiwan, Korea and China are expected to grab a bigger slice of the market in the future, but for now Thailand is the Philippines closest rival.


Author: Likha Cuevas-Miel
Date: June 04, 2014
Source: Interksyon TV5

CONTRACT farming yields significant increase in profitability of tobacco farmers in small-size farms, according to a recent study by the Philippine Institute for Development Studies (Pids).

Linking small farmers to modern markets, whether domestically or for export, increasingly entails participation in modern supply chains coordinated by contract farming, the study by governments economic think tank said.

According to Pids, the case study is based on a survey of smallholders in the tobacco industry, and seems to be the first such application for the Philippines.

The study finds that correcting for endogeneity, participation in contract farming increases farm profitability significantly, and particularly appears to be biased in favor of smaller-farm sizes.

Endogeneity can arise as a result of measurement error, and is only a problem if the researcher wants to recover causal (cause) effects, not only mere correlations. For instance, in a simple supply-and-demand model, when predicting the quantity demanded in equilibrium, the price is endogenous because producers change their price in response to demand and consumers change their demand in response to price and, accordingly, adjustments in calculations are needed.

According to Pids, evidence is also clear that supply chains linking agribusiness with small farmers through contract schemes are a viable model of value addition and inclusive growth in rural areas.

Hence, the institution recommends that policies should be implemented to support an enabling environment for expansion of supply chains.

The study also noted prevailing concerns on possible disadvantages from contract farming to small farmers, but explained that most of the available data and works refute the notion that contract farming tends to exclude the smallest farmers, at least for the case under consideration, but rather point to a positive correlation between participation in contract farming and net farm income.

However, transport cost and inadequate physical accessibility tend to undermine profitability, as well as the likelihood of contract participation, the Pids study said.

The government agency clarified in the study that Pids does not advocate land-reform policies to force further fragmentation of farms.

Coercive reforms aimed at breakdown of farms could be disruptive and inefficient, and that the efficiency of small farms favors supporting the initiative of private agribusiness to increasingly move to a decentralized system involving contract farming with smallholders.

To recall, the Philip Morris Fortune Tobacco Corp. (PMFTC) has established its first Virginia tobacco-experimental farm, covering 10 hectares, in Barangay Ane-i, Claveria, an interior municipality in the eastern part of Misamis Oriental last year.

Initial result of the trial has encouraged the cigarrete company to proceed to the precommercialization phase, according to the National Tobacco Administration (NTA).

With 113 farmers, representing a total area of 58.27 hectares, involved in the second phase, which ended in October last year, PMFTC extended production assistance such as cash, inputs and technical, including tobacco seedlings to the farmers, the tobacco agency said in its statement.

The NTA said the first batch of transplanting for the commercialization phase began in November last year and went on until April of this year, covering a total area of 200 hectares.

Most farmers in Claveria are willing to shift to tobacco farming as they can avail [themselves] production assistance from the cigarette company, the Nta said.

Author: Alladin S. Diega
Date: June 03, 2014
Source: BusinessMirror

PHILIPPINE seafarers are the countrys prime offering for the global maritime industry, a shipping industry official said yesterday.

Speaking at the Philippine Institute for Development Studies (PIDS) seminar, National Workshop on Services: Current Issues and Future Prospects for Philippines Services Sectors in the Asia-Pacific Region and the 21st Century Global Economy, A. Magsaysay Inc. Chief Executive Officer Doris Teresa Magsaysay-Ho said yesterday that the Philippines unique value proposition in the maritime industry is its people.

Ms. Ho -- whose firm has interests in both crewing and shipping, among other sectors -- noted that there are currently 460,000 Filipino seafarers, which is 25% of the global seafarer market. Filipinos have become the seafarer of choice, filling management positions onboard ships and in ancillary services ashore, she said.

She attributed the success of Filipino seafarers to hard work, English proficiency, and the Filipino values they bring with them to the workplace.

Ms. Ho added, however: Successful maritime nations like Germany, Holland, Cyprus and Singapore have a focused government commitment to the industry.

Citing how the Singapore government turned its country into an international maritime center through investment in port infrastructure, she called for development of the same as well as technology in the Philippines.Modern and efficient logistics infrastructure would allow other service sectors to develop, such as ship and chartering brokerage, ship agency, and freight forwarding and logistics services, Ms. Ho said.We must start with stern commitment together with the government to develop the industry in order to build a world-class maritime service proposition, she said. --

Author: B.C.P. Balaoing
Date: June 02, 2014
Source: BusinessWorld

ENSURING a favorable environment for services trade through policy reforms is key to realizing the governments inclusive growth agenda, experts said.
While saying that the Philippine services sector is one of the most competitive in the region and account for 53% of overall employment in the country, National Economic and Development Authority (NEDA) Deputy Director-General Emmanuel F. Esguerra said the industry still has plenty of room to grow.

The country has been able to successfully break into all modes of supply. However, it has one of the most restrictive policy environment for services according to the World Bank, he said at a forum in Makati City yesterday.

Mr. Esguerra said the degree of restrictiveness was highest in the practice of professional services. Foreign ownership in a number of finance-related sectors was limited as well, he added.

Anti-competition business practices also occur even with existing regulations, the official said.

Addressing these issues, therefore, is essential to attaining the desired development outcome, which is inclusive growth, Mr. Esguerra said.

This was echoed by Ramonette B. Serafica, a research consultant at state-run think tank Philippine Institute for Development Studies.

In a policy note, Formulating the Philippine services strategy for inclusive growth, Ms. Serafica said: [I]mproving the competitiveness of all services is essential to transform the economy and achieve broad-based growth. If services are inefficient, costly, of poor quality, and inaccessible especially to the poorer segments of the population, inclusive growth would not be attainable.

Wholesale and retail trade links producers with consumers. Business services improve the efficiency of the firm and enhance product quality. Financial services enable the transformation of savings to investment, she said.

Telecommunications facilitate the dissemination of knowledge. Transport and logistics services move goods and people within and between countries. Education and health services enhance the productivity of the workforce.

Government policy on innovation and human resource development are needed to create an environment conducive for investments in services, Ms. Serafica also said.

Mr. Esguerra said a competition policy is needed, as well as the formation of a consortium of services providers to create synergies.

One might also add deliberately engaging the Filipino diaspora and tapping this market for Filipino services, he said. --

Author: Daryll Edisonn D. Saclag
Date: June 02, 2014
Source: BusinessWorld

Despite the services industrys contribution to the growth of the Philippines economy in recent years, the national government still has no comprehensive strategy in place to further develop the industry, according to the National Economic and Development Authority (Neda).

At the National Workshop on Services on Monday, Neda Deputy Director General Emmanuel Esguerra admitted that the Philippines is still in pursuit of one and that various issues, such as restrictive policies and the lack of institutional memory in government agencies, make crafting a comprehensive strategy a challenge.

It is in fact a very big challenge because services span a wide range of activities and many of these activities have a different government department or regulatory agency on top of it, and, therefore, the challenge is really bringing together these various people in charge of carrying the positions of their own agencies, Esguerra said. Getting institutional memory on hand is already a challenge. How much more the various agencies? But well get there.

Esguerra explained that coordination among and between agencies has become difficult because there was a hiatus in the discussion of the growth of the services sector. This lull, Esguerra said, was also followed by changes in the agencies that handle or regulate certain activities under the services sector.

The Neda official said this is the reason the industry continues to be restrictive. A study released by government think tank Philippine Institute for Development Studies (PIDS) noted the countrys poor performance in the World Banks services trade-restrictiveness index (STRI) which measure the restrictiveness of a countrys policy regime based on policy information.

To improve this, Esguerra said some laws and government policies need to be revised such as the governments policies on the practice of certain professions.

There are more than 20 professions that restrict foreign equity. The list includes all kinds of engineering fields; medical and allied professionals; accountancy, architecture; criminology; chemistry; customs brokerage; environmental planning; forestry; geology; and interior design.

The list also includes landscape architecture; law; librarianship; marine deck officers; marine engine officers; master plumbing; sugar technology; social work; teaching; agriculture; fisheries; and guidance counseling.

Despite being restrictive, PIDS President Gilbert LLanto said the services industry was still able to grow steadily to around 57 percent of the countrys gross domestic product (GDP) in 2013. He added the industry employs around 800,000 Filipinos directly and earned a total revenue of $6 billion.

Llanto also said the IT-Business Process Outsourcing Association of the Philippines (IBPAP) is to account for as much as 10 percent of the Philippine economy by 2016. In that year, the IBPAP expects the services industry will directly employ 1.2 million Filipinos and register revenues worth $85 billion.

As economies develop, the service industries assume a more dominant share of the economy, contributing to growth and the growth potential of the economy. There are estimates showing that services constitute as much as 70 percent of global GDP and that FDI [foreign direct investment] have started shifting toward services which now constitute almost half of total FDI growth to developing countries, Llanto said.

The Philippines is developing a competitive edge in services, but theres need for greater and deeper understanding of this sector for effective policy measures. There are many issues in trade and investments to discuss, he added.

The Philippiness overall score in the SRTI was 53.5, where the higher score indicated a more restrictive policy environment. The countrys score was dragged down by its performance in Professional services, where it scored 80.

The country scored the highest in terms of Transportation, where the Philippines scored 44.2, as well as Financial services, where it scored 45.1. The Philippines scored 50 in both Telecommunications and Retailing, which are not far from the countrys overall score.//

Author: Cai U. Ordinario
Date: June 02, 2014
Source: BusinessMirror

The Mindanao Shipping Conference 2014 on June 18 will tackle Mindanaos shipping and trade prospects and the regions role in sustaining Philippine economic growth.
Key transport and customs officials, economists as well as supply-chain executives expected to attend the one-day conference to be held at the Limketkai Luxe Hotel in Cagayan de Oro City.
Other topics to be discussed at the conference are the government's logistics strategies for Mindanao, the impact of ASEAN economic integration on the transport sector and the Bureau of Customs policies in support of trade facilitation.
Delegates will also get a chance to participate in high-level networking with shipping industry executives, manufacturers, importers and exporters expected to attend the gathering.
Event organizer PortCalls has invited experts to offer their insights into opportunities Mindanao offers to investors, especially in the area of trade and transport.
Heading the list of speakers is Dr. Cayetano Paderanga Jr., former socio-economic planning secretary, who will discuss Philippine macro-economic prospects for the next three years as well as his forecast for Mindanao trade.
Leon M. Dacanay Jr., regional director of the National Economic and Development Authority for Region 10, will speak on growth in Mindanao maritime trade, particularly cargo volumes, direction of trade and how shippers should respond.
The state of preparedness of the Philippine logistics industry as the economies of the Association of Southeast Asian Nations integrate next year will be the focus of Dr. Adora Navarro, a senior research fellow of the Philippine Institute for Development Studies as she discusses the benefits and pitfalls of the regional event.
From the private sector, Augustus Adis, president, PIE-MO Industries Association, will point out the needs of Mindanao shippers and cargo service providers while Jose Manuel de Jesus, president and general manager of Mindanao Container Terminal (MCT), will discuss technological and systems innovations and container throughput at MCT.
Capping the event will be Atty. Agaton Teodoro Uvero, deputy commissioner for the Assessment and Operations Coordinating Group of the Bureau of Customs, who will speak on customs reforms toward greater trade facilitation. Uvero will brief conference delegates on new BOC measures in place to cut red tape, combat corruption and smuggling.

Author: Edu Lopez
Date: June 01, 2014
Source: Manila Bulletin