PIDS in the News Archived (March 2015)

The Philippines should join the UK and Japan in calling for a more focused development agenda. Otherwise, we may not able to prioritize actions to ensure that 'no one is left behind.'

This September, leaders from across the world will gather at the United Nations (UN) to put forward a new development agenda called the Sustainable Development Goals (SDGs), the successor to the Millennium Development Goals (MDGs).

The SDGs put forward a shared vision of where we want to see the world to be in 2030, in terms of economic, social, environmental, and governance conditions, with statistics to be produced by member states in 2015 to serve as baselines for monitoring progress.
At the close of the millennium 15 years ago, 189 UN members adopted the Millennium Declaration which committed humanity to poverty reduction and related goals. The following year, the UN Secretary Generals Road Map for implementing the Millennium Declaration formally defined eight goals, supported by 18 quantified and time-bound targets by 2015, and 48 statistical indicators, which subsequently became known as the MDGs.

The MDGs set forth a framework for global aid discussions, and provided an agenda not only for the world and its member states, but also within countries. Across the world, progress has been observed in many of the MDGs, especially in reducing extreme poverty, and in improving access to education and health services.

The first of the MDGs on poverty reduction has been achieved ahead of the 2015 deadline: the proportion of people with incomes less than $1.25 a day (in 2005 prices) in 2010 (18 percent) was already half the 1990 proportion (36 percent). Despite population growth, 700 million fewer people lived in conditions of extreme poverty in 2010 than in 1990. Still, over a billion (1.2 billion) people are living in extreme poverty.

The UN, in its MDG Report 2014, noted that aside from achieving the extreme poverty reduction target ahead of the 2015 deadline, the world has also already met its targets on access to safe drinking water and improving the lives of at least 100 million slum dwellers. In addition, the targets on gender equality in primary and secondary education and the incidence of malaria are projected to be met by 2015, although gender disparity was noted to be still prevalent in higher levels of education. In addition, results have been observed in the fight against malaria and tuberculosis globally.

Hunger, child undernutrition, and child mortality also have continued to decline. Across the world, the political participation of women has continued to rise. Primary school participation and access to improved sanitation has also risen.

For instance, for poverty reduction, the goal was to reduce by half the proportion of people in extreme poverty from 1990 to 2015, with one of the indicators for measuring this poverty reduction goal and this specific target as the percentage of the population with incomes less than $1 a day (in 1990 prices, or $1.25 in 2005 prices).

The number of targets and indicators for monitoring the MDGS were subsequently further expanded to 21 targets and 60 indicators (see Table 1).

But while much progress on the MDGs has been achieved, the rate of progress has been very uneven across regions, across countries, and across the Goals.

Sub-Saharan Africa bears the brunt of development challenges with continuing food insecurity, very high child and maternal mortality, a large number of people living in informal settlements, an increase in extreme poverty, and an overall shortfall in attaining a majority of the MDGs.

Latin America, the transition economies, as well as the Middle East and North Africa, have shown slow or no progress on some of the MDGs,with persistent (and even rising) inequalities preventing progress on attaining other MDGs. Asia has yielded the fastest progress in reducing poverty and improving access to social services, and yet, even in Asia, the number of people living in extreme poverty are in the hundreds of millions of people.

In the Association of Southeast Asian Nations (ASEAN), many member states have either had low poverty headcount rates since the 1990s, or reduced rates of the proportion of people in extreme poverty.

From the mid-1990s to 2010, Vietnam, Indonesia and Cambodia have shown dramatic improvements in welfare conditions, especially as these countries have been experiencing considerable economic growth as well as implementing a number of successful pro-poor programs.

Indonesia, in particular, has implemented both a conditional cash transfer (CCT) and an unconditional cash transfer.
In contrast, the proportion of people in extreme poverty has been at a practical standstill in the Philippines.

Trends in the lack of changes in poverty headcounts from 2006-2012, whether using the countrys official poverty lines or the international poverty lines ($1.25 per person per day), have actually been quite similar. Thus achieving the first of the MDG targets on reducing extreme poverty and hunger by this year 2015 to half their levels in 1990 is close to impossible for the Philippines.

More recent poverty data from another survey instrument for the first semesters of 2013 and 2014 suggest reportedly a rise in poverty, but actually, a more careful reading of the press release of the Philippine Statistics Authority (PSA) suggests that there was no change in the poverty rate. But because the 2014 survey did not include respondents in the province of Leyte (which was hit hardest by supertyphoon Yolanda), the national poverty rate is likely to be even higher than was estimated by the PSA.
Thus, the Philippines has yet to ensure that its recent economic growth benefits everyone. The wealthiest Filipinos whose wealth continues to rise will need to make more investments in the country that will ultimately assure sustained growth and progress.
Unfinished agenda

In the Philippines, there is evidence that some poor actually manage to exit from poverty, but for every poor who does exit poverty, there is about one non-poor who falls into poverty (likely from shocks of impacts of natural calamities, rising prices of food, loss of jobs, etc.), so the challenge is to set up social protection not only for the poor, but also for the nearly poor who can easily fall into poverty.

Although a fast-growing country like the Philippines will very likely not achieve its MDG targets on poverty reduction, and also on malnutrition, maternal mortality, reducing HIV/AIDS, but it will achieve some MDG targets on primary education for all, gender equality, sanitation and infant mortality.

Improvements in school participation appear to have been result of the governments investments in addressing input deficits (classrooms, teachers, tables, chairs) with increases in budgets for the Department of Education (DepED), as well as in Pantawid Pamilya (our CCT) appear to be paying off with far fewer children of school going age who are out of school. With improved education attainments of children from poor families, it is expected that when these children join the labor market, incomes will likely be higher than what they would have had with less education.

In this end year for the MDGs, while much has been achieved, there is an unfinished development agenda even for the MDG targets that have been met.

Thus discussion on the SDGs has taken shape, with the UN Open Working Group on SDGs proposing double the number of Goals tin the MDGs (17 goals). Within the 17 proposed goals (see Table 2), there would be even much more targets (169) than the MDG targets, and likely there will be at least 300 statistical indicators to monitor for the SDGs.

Table 2. Proposed Sustainable Development Goals
1) End poverty in all its forms everywhere
2) End hunger, achieve food security and improved nutrition, and promote sustainable agriculture
3) Ensure healthy lives and promote wellbeing for all at all ages
4) Ensure inclusive and equitable quality education and promote lifelong learning opportunities for all
5) Achieve gender equality and empower all women and girls
6) Ensure availability and sustainable management of water and sanitation for all
7) Ensure access to affordable, reliable, sustainable and modern energy for all
8) Promote sustained, inclusive and sustainable economic growth, full and productive employment, and decent work for all
9) Build resilient infrastructure, promote inclusive and sustainable industrialisation, and foster innovation
10) Reduce inequality within and among countries
11) Make cities and human settlements inclusive, safe, resilient and sustainable
12) Ensure sustainable consumption and production patterns
13) Take urgent action to combat climate change and its impacts
14) Conserve and sustainably use the oceans, seas and marine resources for sustainable development
15) Protect, restore and promote sustainable use of terrestrial ecosystems, sustainably manage forests, combat desertification and halt and reverse land degradation, and halt biodiversity loss
16) Promote peaceful and inclusive societies for sustainable development, provide access to justice for all and build effective, accountable and inclusive institutions at all levels
17) Strengthen the means of implementation and revitalise the global partnership for sustainable development
Source: United Nations Sustainable Development Knowledge Platform

While undoubtedly, the MDGs was limited in scope, e.g., it did not cover targets on inequality and it was more concerned about poverty issues than a much broader framework, the current proposal on the SDGs is going overboard with too many goals that will likely undermine a clear focus for a development agenda, whether at the global, regional or country level.

The MDGs suffered from the lack of consensus on the targets and indicators, with a mere expert group from international organizations defining all the targets and goals. In contrast, the UN conducted many global conversations, which included 11 thematic and 83 national consultations, and even door-to-door surveys. It also conducted an online My World survey asking people to prioritize the areas theyd like to see addressed in the SDGs.
In 2013, the Open Working Group on SDG even invited official statisticians (that then included myself) to an informal meeting regarding measuring progress, which opened the doors for further discussions with official statisticians. Still, official statisticians have not managed to influence the Open Working Group into keeping things simple.

Setting priorities

The current proposal on the SDGs may have been spoiled by too many cooks, as it does not provide guidance to prioritize targets, but leaves it to regions and countries to to have a roadmap for prioritizing and attaining the SDGs according to context.
Past experience on MDG targeting, however, suggests that country capacities to identify targets are weak.
For instance, the Philippines defined a target to halve poverty rates from 1990, when this was very aspirational and did not take account of historical trends that would have suggested that this is going to be an extra challenge. In Myanmar, baseline indicators on poverty were from 2005, rather than 1990, and yet the government adopted a target to reduce poverty rates in 2015 to half the baselines, when the whole world used 1990 baselines, again making this more an aspirational than a realistic target.
It can also be observed that many of the proposed SDG targets are more of political statements than measureable achievements. Beyond the goals and targets for the SDGs, statistics will need to be identified, and more importantly, there will be a need to provide funds to sustain statistics for the SDGs, whether by governments or donors.

Sadly, even for the 60 MDG indicators, between half to two thirds of these statistics have been produced in ASEAN member states, and likely, for countries with less development and less statistical capacity, the availability of MDG statistics is not as good as in ASEAN (see Table 3). How then can we monitor what we do not measure, especially for countries in more need of development?

Table 3. Total MDG Indicators Produced in Selected ASEAN member nations

Country MDG Indicators
Total Indicators Total produced by NSO Total produced by others
Cambodia 32 20 12
Indonesia 48 28 20
Malaysia 33 15 18
Myanmar 49 3 46
Philippines 42 18 24
Thailand 54 6 48
Vietnam 32 19 13
Sources: National Statistics Offices (NSOs) of Select ASEAN Countries

The UK Prime Minister David Cameron, who co-chaired a High Level Panel, that authored a report to discuss a post 2015 Development Agenda, has suggested trimming down the SDG targets to around ten.

Japan also is not happy about the current proposal. It will be important that the Philippines joins the UK and Japan in calling for a more focused development agenda. Otherwise, we may not able to prioritize actions to ensure that no one is left behind." Rappler.com









Author: Jose Ramon Albert
Date: March 25, 2015
Source: Rappler.com

MANILA, March 21 -- Filipino women engaged in livelihood-related activities should be assisted more by the government and the business sector tofurther realize their full economic potential, state think-tank Philippine Institute for Development Studies (PIDS) said in a recently-published two policy notes.

As part of the countrys observance of Womens Month this, the PIDS has released two papers on women entrepreneurs as outputs of the APEC 2015 Research Project commissioned by the Department of Foreign Affairs.

The author and concurrent PIDS consultant, Lucita Lazo, explored the difficulties women entrepreneurs face in the Philippines, and offered recommendations, to help women entrepreneurs scale up their business ventures as the ASEAN integration and freer trade are becoming more a reality than a concept.

Although the Philippines has repeatedly been commended for its womens empowerment efforts which resulted in good reviews from several international gender indices and local literacy rate surveys, which in fact shows that Filipino women outperform Filipino men, experts say that translating these capabilities into business and leadership opportunities is still a work in progress, the author said.

There are more educated Filipino women, yet mens employment still exceeds womens significantly, and the country boasts of having the highest ratio of female-to-male business leaders, yet, the papers said, opportunities for women continue to be held back by oppressive conditions, and most of all, by persistent economic inequality.

In her first paper, Challenges in the economic participation of women as entrepreneurs, Lazo cited a survey by the Department of Trade and Industry (DTI) in 2009 showing that women make up 54 percent of small and medium enterprises (SMEs), which are known to be the foremost economic vehicle for generating employment.

The Global Entrepreneurship Monitor Survey in 2006-2007, Lazo also noted has ranked the Philippines second highest for having entrepreneurially active women.

However, according to Lazo, these positive recognitions are endangered limited access to resources; the sustainability of their businesses; lack of a business discipline, preparation and readiness for changing economic outlooks; lack of women representatives on decision making levels; lack of access to health and socio-legal protection; and a simple lack of information for a nuanced understanding on the part of leaders and policymakers.

Although the government projects were designed to provide information, service facilities, technology, and innovation to women in SMEs and microenterprises, access [to all of these] is weakened by a network of problems, she said.

Women are most vulnerable to cultural and economic hindrances that often force them to choose their families over their businesses, Lazo said, adding that their [women] independent access to finance is restricted without their husbands consent, as indicated by the Family Code.

The author also cited DTI document which shows that more women register businesses, but more men renew licenses. Womens decision are affected the most by health risks, economic instabilities and catastrophes, making them altogether less able to sustain their businesses, the policy note also said.

The author explained that the lack of organization and representation of women entrepreneurs and bureaucratic firewalls only exacerbate the situation.

Lazos second policy note actually contains the policy recommendations for both the national and regional level, titled Promoting womens participation in the APEC economies: some recommendations.


In it, she argued that the merit often predominates all other judgment, and purveyors don a blind attitude toward gender issues.

Where agency heads perceive gender as inconsequential or unrelated to their respective agency mandates, the talk of gender will not walk far enough to reach the frontlines where it matters, Lazo said, explaining further that if policymakers see the link between gender and national productivity and wealth creation, the case for gender will become a more attractive position.

She identified three goals for policymaking at the national level which include empowerment, enhancing competitiveness, and ensuring sustainability and resilience.

According to her, leaders can empower women entrepreneurs by eliminating barriers to accessing resources, skills, protection, and other opportunities that allow women to build up the readiness, sustainability, and competitiveness of their businesses.

On the other hand, local leaders play an important role if they can provide services such as financial services, counseling, and strengthening linkages through trade fairs and training seminars, Lazo also said.

She specifically recommends incentivizing business registration with access to the supply chain of government procurement programs.

On enhancing competitiveness, leaders must also tap information and communication technologies as part of a comprehensive capacity development, Lazo said, adding the need to instill business discipline, ingenuity, and creativity in women entrepreneurs, the very values essential to remain competitive.

For her final recommendation, Lazo said that national policymakers have to create social safety nets, such as improving access to credit and healthcare, to encourage women to sustain their business ventures and withstand threats of instability and catastrophes.

In her conclusion, the author asserts that the economic contributions of Filipino women are not being harnessed to the fullest because of cultural and economic setbacks.

The rate of women who leave the country seeking better jobs for their family offsets the notion that the Philippines is a progressively equal opportunities country, Lazo said. (ASD/MnB/OpCen)


Author:
Date: March 30, 2015
Source: PIA

There are those who look at things the way they are, and ask why... I dream of things that never were, and ask why not? " Robert Kennedy
The most obvious downside to contract farming is the potential for the buyer/contractor to take advantage of the growers and impose lopsided conditions in the contract. Without competition from other buyers, without alternative land uses, and farmers always not having enough information, this is bound to happen.
However, contract growing is an established business arrangement in Europe and North America. Therefore the polemic of big business exploiting the small must not be entirely true. Otherwise, this manner of doing business would not have lasted. In these more mature farming environments, the biased power relations against the growers have been tempered by the realities of the market as well as the long-term self-interest of the contractors.
For example food giant Del Monte in the United States does not own farms. All of its tomatoes, green beans, sweet corn, peaches, apricot, pears and many others, are supplied by contract growers. In theory, the farmers can sell to other buyers/processors and/or switch to other crops. But they dont because Del Monte makes sure the contract terms are attractive to make the growers loyal to the company. So much so that among the contract growers in California are third-generation tomato suppliers.
There are many examples as well of successful contract growing schemes in developing countries involving a wide range of commodities and many variations of contract terms. Case studies have been conducted on these contract growing schemes and the broad conclusion had been that contract farmers attained higher levels of productivity per hectare or per unit of effort, got better prices for their produce, and hence higher net incomes compared with their independent grower counterparts.
Thus, the bugaboo of exploitation by big business of small farmers is exaggerated and could be managed.
Exclusion of Small Marginal Farmers
The second downside to contract growing is the tendency of buyers/contractors to prefer the bigger, better endowed farmers as suppliers, to the exclusion of small marginal farmers. This is generally true but not always.
Farm size is an important factor in the selection of growers but there are other considerations: 1) farm location i.e. nearness to the processing plant; 2) easy access by way of farm-to-market roads; 3) agro-climatic specificities like soil type, elevation, availability of irrigation; and 4) competence/training of individual farmers; 5) availability of other farm assets, and 6) membership in a cooperative. The fact that the farmers are already organized is a big plus factor since the transaction costs to the contractor will be much less.
In a recent study by Roehlano Briones of the Philippine Institute for Development Studies (PIDS) on tobacco contract growing in Ilocos, participation was positively correlated with farm assets and negatively correlated with farm size. This observation refutes the common apprehension that small farmers will be discriminated against. In fact in certain kinds of farm operations requiring intensive day-to-day management, small farms using family labor may have an advantage over bigger farms using hired labor.
Side-selling or pole vaulting
The third downside to contract growing is side-selling by farmers of committed produce to third parties, referred to locally as pole vaulting. A number of contract growing schemes have failed because of these contract breaches. And this had been a deterrent to many companies entering into long-term contracts.
There are applicable laws on the enforcement of contracts but many corporations find them impractical because very often the cost of litigation is far more than the value of products lost. Likewise, the public perception of the corporation bullying small farmers weigh heavily against the use of legal enforcement measures. Thus, the offending growers are usually just blacklisted and quietly dropped from the roster of cooperators.
On the other hand, many contractors have learned to live with the usually tolerable levels of side-selling and simply treated the losses as part of the cost of doing business.
Some proactive contractors realizing that the most common reasons for pole vaulting are higher prices and immediate need for cash, have resorted to daily adjustment of buying prices especially during periods when supply is scarce and immediate cash payments.
Many contractors find that social pressure and informal sanctions work better than legal measures. Hence, the preference to deal with cooperatives and organized groups of farmers who have ways of exacting discipline on their members. Non-government organizations (NGOs) who help organize and lead farmers groups are very useful as mediators/intercessors in discouraging misbehavior among their members.
Contract farming as a component of integrated rural development strategy
We know what farmers need to become more productive, more competitive in the marketplace and earn more income for their families. Obviously, we are nowhere close to providing the desired enabling conditions since many of our farmers remain unproductive and poor.
In the rural development agenda of many developing countries, contract farming is being increasingly recognized as one way of providing small farmers access to credit, to inputs and to technical knowhow but most importantly access to markets, particularly to the more profitable but stringent modern trade and export markets.
Among our neighbors Thailand is far ahead in exploiting the benefits of contract farming. And they have demonstrated that contract farming could be made to apply over practically all tradable commodities.
We do have some notable success ourselves with banana, pineapple, papaya, broilers and tobacco.
If many more of our farmers were to benefit from this business model, government must take a deliberate decision to promote contract farming and take proactive measures to move the process along. Crucial would be persuading agribusiness to secure their supply chains by contracting small growers not only to comply with their corporate social responsibility commitments but also steeling them for the intense regional competition ahead.
***
Dr. Emil Q. Javier is a Member of the National Academy of Science and Technology (NAST) and also Chair of the Coalition for Agriculture Modernization in the Philippines (CAMP). For any feedback, email eqjavier@yahoo.com.


Author:
Date: March 28, 2015
Source: Manila Bulletin

The country can pursue a policy that will put a cap on capacity of Manila ports in an effort to address the impact of port congestion on businesses and the economy.

Government think tank Philippine Institute for Development Studies (Pids) released a policy note analyzing port congestion and underutilization in the Greater Capital Region composed of the National Capital Region and neighboring Central Luzon and Southern Tagalog.

Among the port traffic development alternatives for Metro Manila and its surrounding areas analyzed by Japan International Cooperation Agency, authors of the Pids study favored an option to limit Manila port to Berth 6 capacity of Manila International Container Terminal (MICT) and no port expansion for South Harbor.

This scenario involves suspending further expansion of MICT beyond its present capacity and the conversion of Pier 9 to a foreign container berth.

Volume restriction is relatively more effective than price incentives in diverting traffic to Batangas and Subic Ports, the Pids study noted.

However, if pursued, the policy notes underscored the need for such effort to be complemented by increasing the number of Bureau of Customs and Philippine Ports Authority personnel at the ports and expand the cargo handling equipment and berth and container yard capacity.

These should commensurate to the volume of cargo and transaction that are targeted to be diverted from the Port of Manila.

Further, the paper proposed that port authorities give instruction that cargoes bound for or coming from the south of Manila should call on the Batangas Port, while those bound for or coming from the north of Manila should call on the Subic Port.

Batangas Port has an annual capacity of 300,000 containers, while Subic Port has an annual capacity of 600,000 containers.

The utilization rates for Batangas Port and Subic Port reached measly 7.8 percent and 6.3 percent, respectively, in 2013.

To address the impact of port congestion, the paper also urged the International Container Terminal Services Inc. to revive the Philippine National Railway (PNR) rail-freight operation to its inland container depot in Calamba, Laguna, during off-peak hours.

The revival of the Philippine National Railway network from Bicol region to La Union can provide a convenient and alternative way to travel and ship cargo in the Luzon area, it said.

The paper said there is also a need for a gradual rehabilitation and improvement of the PNR line so that it can be used to move empty, unclaimed and abandoned containers to an inland container yard.

Further, the paper noted that the problems of port congestion, high trucking cost and surcharge imposed by shipping lines to remove large quantities of empty containers persist even after the city of Manila lifted the truck ban indefinitely in September 2014.

These are compounded by the Department of Public Works and Highwayss ongoing road construction and rehabilitation work near the port area.//


Author:
Date: March 27, 2015
Source: Business Mirror

Any innovation that aims to solve the problems of access by small and medium enterprises (SMEs) to finance must overcome three concerns. First, SMEs are considered opaque firms that are very difficult to assess due to limited verifiable information. Second, the formal banking sector normally rewards account officers who generate returns/profits from big loans. Third, the (high) cost and effort necessary to process a small loan are the same as those needed to process a large loan.




But social inclusion must mean real access to financial services by the underserved -- precisely the SME community. The market per se will not allow the free flow of money to this sector, and the so-called trickle down effect is painstakingly slow. If the vision is to accelerate the flow of funds to SMEs, affirmative action must be taken to avoid a finance/funding gap. Interestingly, aside from the social inclusion goals, there is evidence that increased lending to SMEs can aid financial stability, mainly by reducing the number of non-performing loans and lowering the probability of default by financial institutions.

The SME lending issue can be viewed primarily as a distribution problem. The financial system is so liquid that the Bangko Sentral ng Pilipinas is already starting to introduce policy tools to mop up excess liquidity. And the demand definitely exists. The following are various estimates from different sources of the supply and demand gap: Department of Trade and Industry -- P100 billion; National Economic and Development Authority/Philippine Institute for Development Studies -- P130 billion to 270 billion; International Finance Corporation -- $2.5 billion; and Philippine Exporters Confederation -- P70 billion.

It is necessary is to build a distribution channel that will make funds accessible to the SME market. Access means availability of supply of quality financial services at reasonable costs for the market players. The dimensions of access include the following: a) reliability, or the availability of financing when needed; b) convenience, or the ease of getting to the supplier of funds; c) continuity, or the repeated access to financing based on need; and d) flexibility, or the tailoring of the product to the clients requirements.

UNIQUE TARGET SECTOR

The distribution network needs to address concerns such as transaction costs, fixed costs in intermediation, economies of scale, and regulatory constraints. We need a system that believes in the economic majesty and the financial inclusiveness of lending to SMEs. Banks as fund suppliers must learn to specialize because the SME market is a unique target sector. An all-in-one lending framework for SMEs will only end up being short-handed. There has to be a dedicated organization unit that is set up physically and spatially to reach SMEs where they are. And the processes involved must be suited to the sectors characteristics.

One favored recommendation in international best practice is for separate and probably stand-alone SME units to service this segment. The rationale for an SME unit is for improved operational efficiencies and a targeted and well-defined risk exposure. Efficiencies can be achieved by product standardization and leveraging of information technology across the target clientele. Risk can be managed by streamlining credit assessment and designing credit filters through tools such as a small-business credit scoring system.

Financial institutions have a wide array of options to choose from by way of distribution channels. The more common ones are through branches or dedicated SME business lending centers. These can be complemented with the use of electronic/internet and phone banking to reach clients. Hybrid branch models are possible, with clearly separated space, personnel, and bank office operations dedicated to servicing SMEs within a bank -- an SME bank within a branch model.

The lending process and the turnaround time for loan handling must be closely studied. Which parts of the process should be centralized or decentralized? By their very nature, SMEs must be serviced where they are. Convenience is paramount. Given that SMEs are informal and lack reliable financial information, on-site visits and direct interaction with owners or managers are required. Hence, branch personnel or the business center account officers must be directly involved in delivery and client servicing and possibly some back-office functions. But the bank has other options on where to handle functions such as loan approval, risk analysis, monitoring of credit exposure, and problem management.

Finally, the reward system must be attuned to the desired outcome in SME lending and cannot be as shortsighted to be based solely on the total loan portfolio. The goal of inclusive growth as well as critical parameters in assessing an SMEs performance must be embedded in the formula. These parameters will include, aside from total loans generation, the number of clients categorized by size grouping, market share, cross-sale of other bank products, quality (non-performing loans), jobs generation, and similar impact metrics.

Benel D. Lagua is executive vice-president at the Development Bank of the Philippines. With an AIM-MBM and a Harvard-MPA, he is a part-time faculty of the Ramon V. del Rosario College of Business of De La Salle University.

benellagua@alumni.ksg.harvard.edu


Author: Benel D. Lagua
Date: March 25, 2015
Source: BusinessWorld

The Food and Agriculture Organization (FAO) defines contract farming as agricultural production carried out according to an agreement between a buyer and farmers, which establishes conditions for the production and marketing of a farm product or products.

In this scheme, the farmer agrees to supply agreed quantities of an agricultural product that meets the quality standards and time schedule of the buyer. In turn, the buyer commits to buy the product and, in some cases, supply farm inputs and land preparation services and provide technical advice.

Contract farming is widespread all over Southeast Asia. It is extensively practiced in broiler chicken, dairy, oil palm, vegetable and seeds, and others. In the Philippines, most of the chicken value chain is contract grown by San Miguel and Bounty from day-old-chicks to hatching to growing. Monterey Farms is engaged in contract breeding and fattening of hogs. East-West Seed is active in contracting vegetable seeds.

Several firms are engaged in okra for export to Japan. Cavendish banana exporters, such as Dole Stanfilco, Sumitomo Fruits, Unifrutti, and Lapanday Foods, are mostly supplied by contracted farmers. The same with some companies in pineapple exports, such as Dole and Davco.

SL Agritech, the hybrid rice pioneer, does the outsourcing of rice seeds. Agumil and Kenram are into oil palm. Universal Leaf Philippines deals with small farmers in tobacco.

Many sectors strongly believe in the benefits of contract farming. A 2008 report of Asian Development Bank Institute by Sununtar Sethboonsarng listed these benefits: market access, increased farm incomes, reduced risk of price fluctuations, credit access, timely supply of inputs, reduced production risks for farmers, and introduction of higher value crops.

The same report cited some concerns: buyers monopoly power, shift of labor management to family farms, contract enforcement, bias of firms towards large farms, intensive management needs of growers, and increased risks for the firm.

In addition, pole vaulting, that is, selling by contract farmers to buyers offering higher prices, is a common problem in the Philippines.

Shankar Gopalakrishnan, an Indian political economist (circa 2010) holds negative views about contract farming.

He cited the dangers to small Indian farmers: companies change the standards of the agreement over the years, such as imposing stricter standards; delayed payment by companies; the company demands the use of certain brands of fertilizers; and the company will require the farmer to invest in new facilities, or require workers to work longer hours and at different times, and insist that the crop has to be delivered at a certain exact time.

Further, the company will also tend to ask for the farmers to process the crop, the costs to be borne by the farmer; the cost of supermarket discounts will be imposed on the farmers; farmer who defaults on those loans may be penalized in other ways, and companies may break the contract and fail to buy the crop entirely if it is not profitable for them.

In the Philippines, contract farming has been found to cause a demonstrable and sizable increase in profitability for the tobacco farmers (Roehl Briones, Philippine Institute for Development Studies, 2014). Briones found that contract farming favored smaller farmers, which is contrary to previous findings.

The rigorous study contributes further evidence to confirm that supply/value chains linking agribusiness with small farmers through contract schemes are a viable model of inclusive rural growth, value addition, and economic diversification.

However, transport cost and inadequate physical accessibility tends to undermine profitability as well as the likelihood of contract participation.

Overall, contract farming is a good business model, especially in the Philippines. The model integrates market access, technical assistance, and financing support.

Long-term expansion has been noted in contract grown crops -- both export (banana, pineapple, okra) and domestic (chicken, hogs, vegetable seeds and oil palm).

In the areas studied by Briones, a great majority of tobacco farmers have already switched to contract farming. There were output and profitability increases, but these were mostly for medium to large farmers.

The trailblazing study by Briones further showed that contract farming can also benefit small farmers, just like in tobacco.

In the end, contract farming could be a viable model for inclusive rural growth. It is not the single silver bullet, but an important one. The pre-requisites are good infrastructure (i.e., roads, water supply), contractual commitments by engaged parties and conducive business climate.

Rolando D. Ty is the Vice Chair of the MAP AgriBusiness and Countryside Development Committee, and the Executive Director of the Center for Food and AgriBusiness of the University of Asia and the Pacific.

map@map.org.ph


Author: Rolando T. Dy,
Date: March 25, 2015
Source: BusinessWorld

In the free-trade world, small countries like ours have little economic or geopolitical power. However, the fast-approaching regional economic integration of ASEAN finds the Philippines battle against national inequality stalemated by food-price inflation (http://www.philstar.com:8080/opinion/2015/03/16/1433983/inflation-eating-our-lunch). Despite our best efforts, poverty continues to make gains. The inflationary price pressures of food staples that are widely grown in this country force us to look more closely at food security here at home while free-trade issues are being negotiated with our ASEAN neighbors.
The Food and Agriculture Organization (FAO) simply says that a country has food security when all people, at all times, have physical and economic access to sufficient, safe, and nutritious food to meet their dietary needs and food preferences for an active and healthy life. It says nothing of where the food comes from.
Using this FAO definition, food security can be accomplished in two inter-related ways: through adequate food supplies and, equally important, access to food supply. It is not uncommon for a country to have more than enough supply of food, but because of high prices and low income, people are unable to gain access to food, thus creating a sense of uncertainty.
Our present approach to food security, however, has tended to stress domestic production for the sake of achieving self-sufficiency, which would free us from the need to import additional food. With our colonial agrarian history, the idea of self-sufficiency has great popular appeal and a patina of common sense. But given the recent changes in the world economy, to what extent does this nationalist wisdom still make sense?
Globalization and the imperatives of ASEAN integration have been pushing us forcefully in the direction of agricultural trade liberalization. In what ways does trade liberalization impinge on the problems of food security, understood as supply and access rather than self-sufficiency itself?
According to National Economic Development Authority (NEDA) Secretary Arsenio Balisacan, the problem of food security stems from the policy of Quantitative Restrictions (QRs): the protectionist practice of limiting rice imports beyond a certain amount of tons in order, supposedly, to protect local farmers. Such policies, in fact, produce the opposite effect by limiting access to rice, the single most important food item among Filipinos. As numerous studies have shown, adopting a QR regime on rice has been anti-poor, anti-equity, anti-growth, and anti-development, Balisacan observes.
philstar.com

Indeed, a government think tank, the Philippine Institute for Development Studies (PIDS), has shown that a liberalized trade regime for food security is the more appropriate policy. Consumers would then be able to buy less expensive rice from Thailand and Vietnam. The Institute even recommended that QRs for rice should not be renegotiated for extension; that rice should be fully deregulated. The replacement of QRs with tariffs would bring the government additional revenues.
This sounds fine for the population in general, but what about the nations rice farmers?
The Department of Agriculture (DA) and the National Food Authority (NFA), the two agencies dealing most directly with rice farmers, seem to support instrumental tweaking of present programs rather than the outright abolition of import restrictions and the import monopoly of the NFA. Small farmers, for their part, contend that even present programs dont go far enough toward meeting their real needs. Furthermore, they fear losing the NFA support they currently have.
PARAGOS-Pilipinas"an organization representing small rice producers"questions the proposal to abolish QRs, saying that they stand to lose their livelihoods if this pushes through. Chair Jimmy Tadeo argues, The proposal to abolish restrictions would spell the demise of the local rice industry. As it stands, rice farmers are able to sell their palay at competitive prices without fear of having to compete with highly subsidized cheap rice imports. This is because the NFA has the sole authority to import rice from the global market. The NFA also has the policy of importing rice only during periods of underproduction or shortage. As such, small rice farmers during harvest season do not have to face the deluge of cheaper imported rice.
More importantly, he adds, the palay support price is the only government support that offers direct benefits to small farmers. If this is removed, they will suffer huge losses and become indebted.
Rural women are also raising concerns. Ka Trining Domingo, Katipunan ng Babaeng Pilipina (KABAPA) National President and Pambansang Koalisyon ng Kababaihan sa Kanayunan (PKKK) Honorary President says, Women rice farmers will also lose their livelihoods if the NFA restrictions are abolished. Women farmers continue to benefit from the P17 per kilo price support provided by the NFA. Families also benefit from the low P23 to 27 per kilo selling price of NFA rice. Instead of abolishing the NFA, government must provide more funds for palay procurement to support rice farmers, while at the same time keeping the prices of rice affordable.
If you ask the women farmers, Ka Trining continues, they have very little rice to harvest even without natural calamities because of the lack of government support services such as capital, seeds, irrigation, and technology. For instance, the CARPER Law provides that government will allocate initial cash grants to farmer-beneficiaries for agricultural production. However, the Department of Agrarian Reform has not implemented this provision of the law.
While both these arguments are compelling, they deserve to be looked at in terms of the bigger picture. In the first place, QRs on imports mean that the NFA becomes the single most powerful buyer and seller of rice itself. Its role as rice import monopolist gives us pause as it places enormous power in the hands of a single government agency. In addition, the DAs record of spending and ability to meet deadlines has been fairly problematic in recent years.
But the difficulties of rice farmers also have other sources. Two problems stand out: local rice cartels and smuggling. Cartels continue to profit from the rice trade by manipulating their selling price. They do so by hoarding supplies, thereby triggering price increases. Indeed, economic sabotage can happen at several levels throughout the supply chain by traders, millers, wholesalers and retailers. Cartels, in effect, re-double the QRs on rice, further widening the gap between food supply and access to that supply, especially by the poor squeezed by the rise in prices. Until the cartels are dismantled, rice prices and poverty will remain significant socio-economic problems. The curse of the middleman has held its grip on farmers from time immemorial, and is still one of the most poorly-regulated businesses in the country.
Smuggling is the other big problem. Foreign rice brought in without paying an import tariff creates negative price distortions that undercut local prices, adversely affecting the livelihood of small rice producers. Current law dictates that smuggled rice be disposed of (or returned to) its port of origin. In time of need and high prices, such action can certainly rankle, as seen in 2013 in Davao, where a court ruled against the Bureau of Customs and ordered the release of 4.2 million tons of seized smuggled rice.
Balisacan points out that smuggling is in large part produced by the very policy of quantitative restrictions. Because the QR regime has pushed domestic prices high relative to world market prices, smuggling has become quite attractive. Ironically, without the smuggled rice, domestic rice prices could have actually been higher"food price inflation could have even been higher, poverty could have risen even more.
NEDA agrees, however, that much is to be done for the rice sector to recover from underproduction. While it will take time to repeal the law related to QRs and rice importation, Balisacan said that the government needs to be vigilant in monitoring the supply and demand of rice. We have to find a way to reduce upward price pressures on food.
NEDA also recommends that the government focus on initiatives to increase rice farmers income rather than just increasing their production. Balisacan continues, We must determine if their inputs are expensive. We need to raise farmers productivity. To do so, NEDA advises that irrigation systems be improved, and farmers given access to new agricultural technologies that yield higher harvests.
philst.
Over the last few years, the country has been going through a great deal of reform and restructuring. Through interagency cooperation, weve tackled some big issues, using accurate measurement and proven methods to increase investment and improve anti-poverty and human development. Isnt it time we did the same with agricultural development?
Mindanao"currently among the nations poorest regions"has enormous rice production potential. Elsewhere, proper irrigation could greatly increase production. As important as increased production is to lowering food prices and perhaps even moving toward a day when we might become a competitive rice exporter, Balisacans emphasis on improving the income of our rice farmers is noteworthy. Anti-poverty policies and inclusive economic growth have prospered under an attitude of interagency cooperation and reliance on careful measurement to discern which policies to nurture and which to abandon. Where food security is concerned, policy changes such as the easing of quantitative restrictions to increase greater access to staples like rice would certainly mark an important beginning.//



Author: Lila Ramos Shahani
Date: March 23, 2015
Source: Philippine Star

The country can pursue a policy that will put a cap on capacity of Manila ports in an effort to address the impact of port congestion on businesses and the economy.
Government think tank Philippine Institute for Development Studies (Pids) released a policy note analyzing port congestion and underutilization in the Greater Capital Region composed of the National Capital Region and neighboring Central Luzon and Southern Tagalog.
Among the port traffic development alternatives for Metro Manila and its surrounding areas analyzed by Japan International Cooperation Agency, authors of the Pids study favored an option to limit Manila port to Berth 6 capacity of Manila International Container Terminal (MICT) and no port expansion for South Harbor.
This scenario involves suspending further expansion of MICT beyond its present capacity and the conversion of Pier 9 to a foreign container berth.
Volume restriction is relatively more effective than price incentives in diverting traffic to Batangas and Subic Ports, the Pids study noted.
However, if pursued, the policy notes underscored the need for such effort to be complemented by increasing the number of Bureau of Customs and Philippine Ports Authority personnel at the ports and expand the cargo handling equipment and berth and container yard capacity.
These should commensurate to the volume of cargo and transaction that are targeted to be diverted from the Port of Manila.
Further, the paper proposed that port authorities give instruction that cargoes bound for or coming from the south of Manila should call on the Batangas Port, while those bound for or coming from the north of Manila should call on the Subic Port.
Batangas Port has an annual capacity of 300,000 containers, while Subic Port has an annual capacity of 600,000 containers.
The utilization rates for Batangas Port and Subic Port reached measly 7.8 percent and 6.3 percent, respectively, in 2013.
To address the impact of port congestion, the paper also urged the International Container Terminal Services Inc. to revive the Philippine National Railway (PNR) rail-freight operation to its inland container depot in Calamba, Laguna, during off-peak hours.
The revival of the Philippine National Railway network from Bicol region to La Union can provide a convenient and alternative way to travel and ship cargo in the Luzon area, it said.
The paper said there is also a need for a gradual rehabilitation and improvement of the PNR line so that it can be used to move empty, unclaimed and abandoned containers to an inland container yard.
Further, the paper noted that the problems of port congestion, high trucking cost and surcharge imposed by shipping lines to remove large quantities of empty containers persist even after the city of Manila lifted the truck ban indefinitely in September 2014.
These are compounded by the Department of Public Works and Highwayss ongoing road construction and rehabilitation work near the port area.


Author: Bernie Magkilat
Date: March 22, 2015
Source: Manila Bulletin

The government should continue its efforts to further enhance the utilization of free trade agreements (FTAs) especially by manufacturing and services sector companies, including setting up an FTA portal.
A new discussion paper published by the Philippine Institute for Development Studies (PIDS) lately titled How Are Firms Responding to Philippine Free Trade Agreements, which was emailed to select entities,uding The Daily Tribune, reported that the manufacturing sector is increasing compared with a 2010 study.

The two sectors report that FTA utilization is still hampered by a lack of information which, when available, was rated poorly in terms of quality and volume.

Identified as the main source of information for FTAs, the government needs to increase the efficiency scope, and reach of its promotional and technical training programs and to rely further on technology to deliver results, it said.

The Department of Trade and Industry (DTI) has made considerable efforts to increase FTA awareness through the conduct of Doing Business in FTAs (DBFTA) sessions nationwide, and the publication of a DBFTA Handbook, as well as FTA primers.
To complement these initiatives, the PIDS paper said the government needs to further promote FTAs by setting up a portal where information about the benefits of FTAs, the process of gaining access, the requirements and forms and other relevant information can be easily accessed or downloaded.

This FTA portal, which should be an improvement on what is currently offered on the DTI Web site, will most likely enhance FTA awareness, eventually translating into increased utilization levels, it said.

The paper said the FTA portal is not only cost-effective but also a means to promote transparency in the process of Certificates of Origin (COO) issuance, thus minimizing rent-seeking behavior of the agencies involved in FTA implementation.

It said efforts should include reforms toward electronics COO and self-certification and linkage to the national single window.
This will improve timelines and ease the entry of micro, small and medium enterprises. Regional efforts to harmonize ROOs (rules of origins) can increase FTA utilization across Asean member-countries and pave the way for the forthcoming Regional Comprehensive Economic Partnership, the paper added.//


Author: Ed Velasco
Date: March 19, 2015
Source: The Daily Tribune

The Philippine economy lost an estimated P43.85 billion due to the seven-month truck ban imposed by the city of Manila last year, according to a study released by state-owned think tank Philippine Institute of Development Studies (PIDS).
In a study titled A System-wide Study of the Logistics Industry in the Greater Capital Region, PIDS researchers led by Epictetus E. Patalinghug said the amount included lost Customs revenue, output losses, and vehicle operating costs.
This value includes employment and output losses of manufacturing firms in economic zones net of truck-ban benefits such as reduced emissions and traffic congestion in the restricted areas, the study stated.
The researchers estimated that the Bureau of Customs (BOC) losses cornered the lions share of the amount. The Customs agencys revenue losses reached an estimated P25.55 billion.
This was followed by output losses that reached P18.20 billion during the seven-month period.
The truck ban in the city of Manila also caused other problems such as the doubling of shipping costs for 20 footer and/or 40 footer containers.
Prior to the truck ban, the study noted that shipping costs for these types of containers amounted to P18,000 but after the truck ban, the cost reached P36,000.
Port congestion as a result of the truck ban led to time delay in cargo releasing. For instance, a cargo that took from three to four days to be released before the truck ban took from seven to 10 days to be released after the truck ban, the study added.
To help ease congestion in Metro Manila, the study urged the national government to consider shifting road-based freight transport to rail transport.
The study stated that under a 50- percent, 70-percent, and 100-percent shift of road-based freight transport to rail transport will remove 1 percent to 4 percent of truck traffic from the city streets.
The researchers said that while the shift will not result in a greater contribution to ease congestion in Metro Manila streets, giving shippers alternatives would improve the freight industry.
With traffic congestion going to get worse in Metro Manila, shippers/locators could opt to bypass Metro Manila by using the rail system to transport their goods, while at the same time, truckers can still provide their services when moving the goods from the inland container terminals to the end destination of the goods or the other way around, the researchers said.
The study also urged the government to consider developing new export processing zones near railway lines so that shippers can use rail as an incentive in transporting their products.
The rail system, the study stated, should be able to connect processing zones, ports and airports to improve the transport of goods in and out of Metro Manila.//

Author: Cai Ordinario
Date: March 18, 2015
Source: Business Mirror

ZAMBOANGA CITY -- The Zamboanga Peninsula is banking on the development of its champion products such as mango, abaca and sardines to cash in on the zero tariffs granted under the European Union-Generalized Scheme of Preferences Plus (EU-GSP+), to which the Philippines was admitted in December.

Department of Trade and Industry (DTI) Regional Director Sitti Amina M. Jain said the agency is helping small and medium enterprises (SMEs) develop products to make the region a key exporter to the EU, acknowledging the big gap between market potential and local capacity.

DTI is looking at the opportunities in terms of expansion of businesses, and the industries, therefore expanding opportunities for employment. We are looking at 200,000 jobs (nationwide) to be generated by the (GSP+) scheme, Ms. Jain said.

There are about 30,000 registered SMEs in the region.

Processed mango, for example, which is charged between 5% to 11% tariff under the regular GSP program, is one of the Philippine products that can now enter the EU market at zero tariff.

Zamboanga Peninsula, or Region 9, was the countrys number two producer of fresh mango in 2013, based on data from the Philippine Statistics Authority.

However, the majority of SME mango processors in the Philippines are located in Metro Manila and Cebu, according to a February 2013 study by the Philippine Institute for Development Studies.

Michael Vincent Cajulao, DTI Region 9 information officer, said the agency is cooperating with other government departments such as the Department of Science and Technology and the Food and Drug Administration in product development and standards.

Once we get in, even in just one of the 28 member countries, it will be easier for us to get into other markets, Mr. Cajulao said in a phone interview.

The EU-GSP+ will only be in effect within the next six to 10 years.

For abaca, another GSP+ item that used to be charged a 4.8% tariff, stakeholders in the region met with the DTI in January to consolidate a plan of action for the sectors sustainable growth.

Region 9s abaca production, based on data from the Bureau of Agricultural Statistics, more than doubled in 2011 to 631 metric tons (MT), grew to 675 MT in 2012 at 675 MT, but declined in 2013 to 589 MT.

The Philippines abaca exports, with have the United Kingdom as their biggest importer, enjoyed a 20.7% increase last year in the 11 months to November compared to the same period a year earlier. The Bicol region cornered the biggest share at 41%, followed by Eastern Visayas with 19.4% share and the Autonomous Region in Muslim Mindanao, 10.7%.

Sardines, a major fish catch in the region, is another potential sector for growth with preserved sardines now down to zero tariff from the previous 9%.

However, Roberto A. Baylosis, executive vice-president of the Southern Philippines Deep Sea Fishing Association, Inc. (SOPHIL), said that existing government processes are not conducive to business growth.

My personal opinion of what the commercial fishing industry would need from the government at this point is to eliminate, if not reduce, the burden to the commercial fishing due to too much red tape being enforced by the different government agencies concerned, Mr. Baylosis said in an e-mail interview with BusinessWorld.

Instead, (we must) continue and maintain the science-based study of fisheries for adoption of conservation measures and proper management, including an information campaign for the commercial fishing operators as to the correct period and the appropriate area of the fish stocks suitable for harvest, he added.

The Zamboanga City-based SOPHIL is composed of 12 commercial fishing companies operating within domestic waters and engaged mainly in harvesting only for the local market.

There are fish canning factories operating within the Zamboanga City Special Economic Zone.

Zamboanga Peninsula -- composed of the provinces of Zamboanga del Norte, Zamboanga del Sur, and Zamboanga Sibugay and the chartered city of Zamboanga -- saw a slowdown in its gross regional domestic product growth to 4.3% in 2013 from 12.9% the previous year due in part to power supply shortages and the impact of the three-week siege of Zamboanga City by members of the Moro National Liberation Front in September 2013. -- with a report from Marifi S. Jara

Author: Karel B. Mellanes
Date: March 18, 2015
Source: BusinessWorld

ILOILO CITY, March 18 (PIA6) " Its been about 8 years since leaders of the Association of Southeast Asian Nations (ASEAN) adopted the ASEAN Economic Blueprint in Singapore to serve as a coherent master plan guide for the establishment of the ASEAN Economic Community this year.

Since then too, the Philippines has been exerting efforts to meet its commitments vis--vis the AEC Scorecard, concerns that have been assessed and monitored especially by the National Economic and Development Authority (NEDA) and studied by the Philippine Institute for Development Studies (PIDS).

How the country has been faring in its journey to become an active stakeholder in the community especially in making it become a highly competitive economic region depends in part on the contributions of the different regions

In Western Visayas, in particular, Regional Competitiveness Committee (RCC) was set to look into how Western Visayas is taking the competitiveness challenge vis--vis the AEC.

The action involves local government units and other stakeholders as well including national government agencies and non-government organizations.

RCC co-chairperson and NEDA-6 Regional Director Ro-Ann Bacal said at a recent meeting that the committee will be coming up by end-March with an inventory of NGA and LGU programs and projects that contribute to the competitiveness of the region.

With this, we can identify the competitive areas as well as the things that have to be done to enhance the regions competitiveness, said Bacal.

We should focus on things that we are already good at and to level up, she added.

The ASEAN Economic Community (AEC), according to the ASEAN website, shall be the goal of regional economic integration by this year. AEC envisages the following key characteristics: (a) a single market and production base, (b) a highly competitive economic region, (c) a region of equitable economic development, and (d) a region fully integrated into the global economy.

The AEC areas of cooperation include human resources development and capacity building; recognition of professional qualifications; closer consultation on macroeconomic and financial policies; trade financing measures; enhanced infrastructure and communications connectivity; development of electronic transactions through e-ASEAN; integrating industries across the region to promote regional sourcing; and enhancing private sector involvement for the building of the AEC. In short, the AEC will transform ASEAN into a region with free movement of goods, services, investment, skilled labor, and freer flow of capital.

Bacal shared that the AEC would bring about benefits to member-countries but this also means doing more actions for the region in particular and the country in general to become competitive. (JCM/JSC-PIA6)

- See more at: http://news.pia.gov.ph/article/view/901426652395/competitiveness-for-aec-needs-level-up-actions#sthash.2VkJDOn5.dpuf

Author: Jaime S. Cabag, Jr.
Date: March 18, 2015
Source: PIA

THE government must continue its efforts to enhance the utilization of free trade agreements (FTAs) especially by manufacturing and services sector companies, including setting up an FTA portal.

A new discussion paper published by the Philippine Institute for Development Studies (PIDS) titled "How Are Firms Responding to Philippine Free Trade Agreements?" made the proposal although the utilization rate of FTAs reported by the manufacturing sector is increasing compared with a 2010 study.

The two sectors report that FTA utilization is still hampered by a lack of information which, when available, was rated poorly in terms of quality and volume.

"Identified as the main source of information for FTAs, the government needs to increase the efficiency scope, and reach of its promotional and technical training programs and to rely further on technology to deliver results," it said.

The Department of Trade and Industry (DTI) has been trying to increase FTA awareness through Doing Business in FTAs (DBFTA) sessions nationwide, and the publication of a DBFTA Handbook, as well as FTA primers.

To complement these initiatives, the PIDS paper said the government needs to further promote FTAs by setting up a portal where information about the benefits of FTAs, the process of gaining access, the requirements and forms and other relevant information can be easily accessed or downloaded.

The paper noted that the FTA portal is not only cost-effective but also a means to promote transparency in the process of Certificates of Origin (COO) issuance, thus minimizing rent-seeking behavior of the agencies involved in FTA implementation.
It said efforts should include reforms toward electronics COO and self-certification and linkage to the national single window.//


Author:
Date: March 17, 2015
Source: Sun Star Cebu

THE PHILIPPINES audit agency must formulate rules on how government bodies should return unused funds from the Disbursement Acceleration Program (DAP), a stimulus spending scheme parts of which were later rendered unconstitutional.

Senate finance committee Chairman Francis Chiz G. Escudero made these remarks on Tuesday, directing Commission on Audit (CoA) officials to establish standard procedure after discovering that no single ruling indicated how unused funds from the DAP are to be returned. A program of the Aquino administration, the DAP intended to spur economic growth by quicker spending. Three provisions of the DAP have previously been deemed unconstitutional by the Supreme Court.

Director Rufina S. Laquindanum, Corporate Governance Sector (CGS) 3 of the CoA said that currently, there is an instruction to all auditing leaders to issue auditing observations and that some of those observations include the need to remit unutilized funds. Ms. Laquindanum added that there is an ongoing consolidation of audit findings on DAP and its utilization.

Ms. Laquindanum also made clarifications on an online report that served as the basis for Senator Miriam Defensor-Santiagos resolution to conduct the Senate inquiry, saying that data were not accurately picked up.

The report stated that a total of P2.405 billion were unused by the National Electrification Administration (NEA), Philippine Institute for Development Studies (PIDS), National Dairy Authority (NDA) and the Philippine Fisheries Development Authority (PFDA).

According to Ms. Laquindanum, P2.405 billion refers to the funds received by the four government-owned and -controlled corporations. We are not describing it as unused, said Ms. Laquindanum.

Administrator Sonia B. San Diego, Corporate Resources of the NEA, said that they are targeting to liquidate the remaining P639 million from their agency by the end of 2015.

Director Joseph B. Anacay, CGS Cluster 6 of the CoA said that of the P296-million DAP funds that PIDS released to the Commission on Higher Education (CHEd) and which was subsequently released to state universities and colleges, P260.54 million remain unliquidated. The funds were channeled into research, development and extension programs.

Director Napoleon K. Juanillo, CHEd Office of Planning, Research and Knowledge Management, said that the programs encompassed food production, marine biodiversity and conservation, climate change, disaster preparedness, health systems and education.

Loralie C. Datahan, officer-in-charge of the Office of the Assistant General Manager of the PFDA said that as of January 2015, they have returned all unutilized funds amounting to P189.858 million. --

Author: Elizabeth E. Escao
Date: March 17, 2015
Source: BusinessWorld

THE Senate Committee on Finance on Tuesday asked the Commission on Audit (COA) to issue a uniform ruling for the return of all unused funds by government-owned and -controlled corporations (GOCCs) under the Disbursement Acceleration Program (DAP) in accordance with a Supreme Court (SC) ruling on the unconstitutional spending mechanism.
According to Sen. Francis Escudero, about P2.4 billion in DAP funds is unutilized by
four GOCCs"National Electrification Administration (NEA), Philippine Institute for Development Studies (PIDS), National Dairy Authority (NDA) and the Philippine Fisheries Development Authority (PFDA).
In an interview after the Senate finance committee hearing on unaccounted DAP funds, Escudero said the four GOCCs are obliged to return the unused allocations based on the SC decision declaring the DAP unconstitutional.
He noted that based on the High Court ruling, funds for projects under the DAP that were not implemented before the decision was issued are required to be returned, and only those projects that had been started are allowed to proceed.
The senator said some GOCCs are willing to return their unutilized DAP funds and they are just waiting for guidance from the Commission on Audit (COA).
This is the reason why we asked COA to issue a uniform ruling in order for the GOCCs to return the funds, Escudero added.
Sen. Miriam Defensor-Santiago had filed the resolution asking the proper Senate committee to look into the alleged P3.7 billion unaccounted DAP funds of the four GOCCs.
The senator based her resolution on the 2013 Annual Financial Report on GOCCs released on October 20, 2014 stating that of the P3.787 billion DAP funds released, P2.4 billion was not used by the GOCCs.
Based on the report, NEA has not used P1.58 billion; PIDS, P560 million; NDA, P167.4 million; and PFDA, P98 million.
Escudero asked COA to come up with a clear ruling on liquidation process, especially on funds intended for research.
The senator said the commission should set a deadline for multi-year researches and not allow funds to remain unliquidated.
As for the P2.4-billion unused DAP funds, Escudero added that he was informed that 80 percent of the amount has been utilized and about 60 percent of it has been liquidated.

Author: Jefferson Antiporda
Date: March 17, 2015
Source: Manila Times

MANILA, Philippines - The government should continue its efforts to further enhance the utilization of free trade agreements (FTAs) especially by manufacturing and services sector companies, including setting up an FTA portal.
A new discussion paper published by the Philippine Institute for Development Studies (PIDS) titled How Are Firms Responding to Philippine Free Trade Agreements? made the proposal although the utilization rate of FTAs reported by the manufacturing sector is increasing compared with a 2010 study.
The two sectors report that FTA utilization is still hampered by a lack of information which, when available, was rated poorly in terms of quality and volume.
Identified as the main source of information for FTAs, the government needs to increase the efficiency scope, and reach of its promotional and technical training programs and to rely further on technology to deliver results, it said.
The Department of Trade and Industry (DTI) has made considerable efforts to increase FTA awareness through the conduct of Doing Business in FTAs (DBFTA) sessions nationwide, and the publication of a DBFTA Handbook, as well as FTA primers.
To complement these initiatives, the PIDS paper said the government needs to further promote FTAs by setting up a portal where information about the benefits of FTAs, the process of gaining access, the requirements and forms and other relevant information can be easily accessed or downloaded.
This FTA portal, which should be an improvement on what is currently offered on the DTI website, will most likely enhance FTA awareness, eventually translating into increased utilization levels, it said.
The paper noted that the FTA portal is not only cost-effective but also a means to promote transparency in the process of Certificates of Origin (COO) issuance, thus minimizing rent-seeking behaviour of the agencies involved in FTA implementation.
It said efforts should include reforms toward electronics COO and self-certification and linkage to the national single window.
This will improve timelines and ease the entry of micro, small and medium enterprises. Regional efforts to harmonize ROOs (rules of origins) can increase FTA utilization across ASEAN member-countries and pave the way for the forthcoming Regional Comprehensive Economic Partnership, the paper added.//


Author:
Date: March 16, 2015
Source: Philippine Star

THE national government is crossing its fingers that the impending El Nio will not be as worse as the one the country experienced in 1998 when the country saw a 10-percent contraction in farm sector growth.
Up until now, its still on the 50 percent-to-60 percent probability, so its still low. I think what well have is like a spot El Nio; so hopefully its not going to be as bad as 1998, National Economic and Development Authority (Neda) Assistant Director General Rosemarie Edillion said.
The El Nio weather phenomenon usually hits the production of the countrys staple, rice, a water-loving crop. If there is a reduction in rice production, prices of the staple could escalate.
In 2014 Bureau of Agricultural Statistics (BAS) Head Romeo Recide said the impact of a severe El Nio on agriculture growth could lead to a reduction of 10 percentage points. He said this is what happened in the 1997 and 1998 El Nio phenomenon, when the dry spell not only affected crops, such as palay, but also livestock.
Recide, however, said given that the Pagasa has already revised its predictions on the El Nio and it seems that the dry spell would not be as severe as expected, the impact on agriculture growth could be a reduction of less than a percentage point.
He explained that a dry spell that occurs during harvest season, or during the rainy months, would be beneficial to crops. Recide added that there are crops that thrive during El Nio like mangoes, which could offset the slack in production experienced by other crops such as palay.
Not all El Nios are alike. Some El Nios are actually favorable, some of them become too severe affecting the whole sector as what happened in 1997 and 1998, Recide said.
It can get really, really bad. Agriculture growth went down by as much as 8 to 10 percentage points in 1998. That was huge because all commodities were affected, even livestock was affected. Usually, livestock is robust during El Nio but at that time, rice, alone, went down by 26 percent, so its almost one-fourth. But that was the worst El Nio, he explained.
Meanwhile, Neda Director General and Economic Planning Secretary Arsenio M. Balisacan said the high cost of rice was among the primary reasons for the increase in poverty in the first semester of 2014.
The countrys poverty incidence increased to 25.8 percent in the January-to-June period in 2014, higher than the 24.6 percent. This fell short of the 23-percent to 25-percent target of the government for the period.
Balisacan said food inflation in 2014 averaged 6.5 percent on the back of an 11.9-percent increase in rice inflation and 10.3 percent increase in vegetable prices.
The reduction of poverty incidence in 2013 could have continued in 2014 were it not for the high food price inflation. In particular, for rice, the situation could have been avoided had we been able to take advantage of the favorable world market condition for rice, Balisacan said.
Due to this missed opportunity, Balisacan said the government already learned its lesson and is now undertaking efforts to plan a post-2017 scenario when the extension of the countrys quantitative restriction (QR) on Rice is expected to expire.
When the Philippines acceded to the World Trade Organization (WTO) in 1995, the country agreed to convert QRs into equivalent tariffs (tariffication).
However, the Philippines obtained a special treatment for rice up to 2005, allowing it to maintain its rice QR. The Philippines was, thus far, successful in extending its QR to 2017.
Balisacan said the extension of the QR was also necessary since Republic Act 8178, or the Agriculture Tariffication Act of 1996, provides that rice should be covered by a QR.
[Until the law is amended] de facto QR ang [tariff] natin sa rice. We will study it sowe can recommended something to theCabinet. We have to cure the root of the problem, which is the uncertainty in trade of agricultural commodities, Balisacan said.
Removing the QR, the Neda chief said, will help stabilize prices because there will be a steady flow of rice imports entering the Philippines. This will also reduce rice prices.
Balisacan said the Neda, along with the agriculture and trade departments, will also be drafting proposals to address the QR and prepare for its expiration on 2017.
These proposals will include transparent measures such as tariffication of the rice QR in the post-2017 period. However, Balisacan said the law must first be amended before 2017 to ensure that these measures can be implemented.
A study released by state-owned think tank Philippine Institute for Development Studies estimated that under a free-trade scenario, total rice imports could have reached 4.2 million tons. This will bring down retail prices to P19.8 per kilo and wholesale prices to P17.66 per kilo.
This would result in a consumer surplus of P178.07 billion. However, this would cause a P33.99-billion reduction in producer surplus and a P5.63-billion reduction in importers revenue.
This means the net gain under this scenario would be P138.46 billion on top of the baseline, which is P442.49 billion.//


Author: Cai Ordinario
Date: March 15, 2015
Source: Business Mirror

The Senate and House of Representatives are bent on passing this week two important reform measures that the business sector has long been seeking to improve the investment climate in the country.
The Senate is committed to passing the bill creating the Philippine Trade Representative Office (PTRO), which will coordinate the countrys trade policies in international negotiations, despite previous objections made by the Department of Trade and Industry (DTI), which is of the view that it would only create redundancy and inefficiency in implementing the countrys overall trade-related strategy.
During the Joint Foreign Chambers (JFC) Arangkada Forum 2015 last week, Senate President Franklin M. Drilon pushed for various legislation affecting economic policies and the business community, particularly citing the establishment of the PTRO.
We intend to pass measures to establish institutions that would support our move toward liberalization. We will create two new offices: a Philippine Trade Representative Office, which will serve as the countrys central agency tasked to formulate a cohesive trade strategy and, second, a Department of Information and Communications Technology, to support the development of our ICT systems, Drilon said in his statement.
In the Senate, the creation of such office is supported by Senate Bills 1084, 1149 and 1404 filed by Senators Teofisto Guingona III, Antonio Sonny F. Trillanes and Jinggoy P. Ejercito-Estrada, respectively.
In the House of Representatives, the counterpart measures are House Bills (HB) 02770 and 01690, authored by Rep. Henry A. Teves and Rep. Karlo Nograles.
The lawmakers versions commonly cite the overlapping functions and responsibilities of several agencies to handle trade negotiations and the lack of a central coordinating body to consolidate and study the countrys various trade agreements.
The DTI, however, strongly opposed the measure, writing to House Committee on Government Reorganization last year that the move will overstep the functions and jurisdiction of the department through the Bureau of International Trade Relations, which has already developed expertise in trade negotiations and in forging trade agreements with other countries.
Additionally, the DTI, in its paper, said the implementation of trade policy, whether in the domestic or international setting, is a function conferred by law through Executive Order 133.
Moreover, according to the DTI, in creating the PTRO, the authority to rule on trade matters will be separated from the industry aspect, which, in turn, will cause ineffeciency in both areas.
Trade and industry policies are naturally and inextricably linked, such that industry policy should underpin trade policy and vice versa. Segregating the functions causes ineffectiveness in both areas, thereby, hindering their full potential to serve overall national interest, according to the position paper of the trade office.
On practical terms, the trade office, likewise, cited a previous paper published by the Philippine Institute for Development Studies that states establishing a Cabinet-level agency exclusively handling international trade negotiations is not feasible considering the huge resources that will be needed for the separate department.
Meanwhile, Liberal Party Rep. Antonio Rafael del Rosario of Davao del Norte said the lower chamber is eyeing to pass the proposed Philippine Fair Competition Act, or HB 5286, which consolidates the different House versions of the bill.
He said the members of the lower chamber may approve the measure on second reading this week, after the period of amendments, which is set to start on Monday (today).
Hopefully, this week we will approve it [on second reading], del Rosario said.
Speaker Feliciano Belmonte Jr., one of the authors of the consolidated bill, said the lower house will approve on third reading the fair competition measure, which aims to minimize, if not totally eradicate, unfair competition, monopolies and cartels, before the Congresss March 21 break.
Congress will take a break from March 21 to May 3.
This Philippine Fair Competition law has been repeatedly filed since the 8th Congress but it has never succeeded. But, this time [the 16th Congress], I think, we will succeed because we have actually finished the period of interpellations. This week [we will start] the period of amendments, Belmonte said. That is a piece of legislation that is very much needed and Im hopeful that we can do it on the 18th or 19th of March, or before we adjourn, he added.
The JFC and Philippine business groups have repeatedly urged the leadership of the House of Representatives to prioritize the passage of several economic measures, including the proposed Philippine Fair Competition Act.
The bill heavily penalizes monopoly, anticompetitive mergers and other unfair trade practices.
The measure defines monopoly as a form of market structure in which one entity, having earned a privilege or obtained advantage over the others, accounts for the sales of a good or service.
As defined under the measure, mergers are situations where two or more entities, previously independent of one another, join together. These include transactions whereby: two entities combine into one; one entity takes control of the whole or part of another; two or more entities acquire control over another entity and other transaction, whereby one or more undertakings acquire control over one or more entities.
The bill also proposes to create the Philippine Competition Commission that will prosecute those engaged in unfair and deceptive trade practices and other such practices with the purpose of preventing, restricting, or distorting competition.
Further, the bill provides for a Transitional Clause in order to allow affected parties time to renegotiate agreements or restructure their business to comply with the law.
According to the measure, the PCC is an independent body, which shall have original and exclusive jurisdiction to enforce and implement the competition law.
Likewise, the bill said the PCC is empowered to investigate violations of the competition law, issue subpoena duces tecum and testificandum, cease and desist orders, conduct administrative proceedings, impose administrative fines, issue advisory or legal opinions, and is mandated to submit reports to Congress, including proposed legislation for the regulation of commerce, trade and industry.
The bill said that, in determining whether anticompetitive agreement or conduct has been entered into or committed, the commission shall observe the following guidelines:
Define the relevant market allegedly affected by the anticompetitive agreement or conduct;
Determine if there is actual or potential adverse impact on competition in the relevant market caused by the alleged agreement or conduct, and if such impact is substantial and outweighs the actual or potential efficiency gains that result from the same;
Adopt a broad and forward-looking perspective, recognizing future market developments, but also taking account of past behavior of the parties involved and prevailing market conditions;
Balance the need to ensure that competition is not prevented or substantially restricted and the risk that efficiency may be deterred by overzealous intervention; and
Assess the totality of evidence on whether it is more likely than not that the entity has engaged in anticompetitive agreement or conduct.
Under the bill, any person who fails or neglects to comply with any term or condition of a binding ruling, a cease and desist order or an order for readjustment issued by the commission, shall pay a fine of not less than P50,000 and not more P200,000 for each violation.//

Author: Catherine Pillas
Date: March 08, 2015
Source: Business Mirror

Filipino farmers will soon get big help from Yanmar, an iconic Japanese firm with over 100-year stellar record in manufacturing quality agricultural equipment, as the company prepares to its grand launch in the Philippines.
Set for tomorrow at the Sofitel Hotel, Yanmar Philippines is excited to enter the Philippine agricultural market to help assist Filipino farmers who are estimated to be half of the countrys 42 million labor force.
It is our share in modernizing the Philippine agriculture, said Cristy Rose Eltagon, advertising head of Ropali Group of Companies, the partner of Yanmar Japan in launching Yanmar Philippines.
Ropali Group of Companies is a major shareholder in Yanmar Philippines.
Yanmars entry to the Philippines can be considered a great blessing as it will boost farmers capability to cultivate their lands without the old, slow and unreliable carabaos, now viewed as symbols of the countrys backwardness in agriculture arena.
According to the firm, the Philippines is currently the worlds eighth biggest producer of rice. With the help of the agricultural machinery it builds, Yanmar believes it can help increase the scale of food production in the country in the future.
Continued economic growth and a greater demand for agricultural machinery make the Philippines an important market for Yanmar.
It has also carried out thorough research relating to the Philippines agricultural industry and society.
Yanmar partnered up with Ropali Corp. for the establishment of a joint venture which was registered in February 2015.
Ropali Corp., on the other hand, is involved in industries in the Philippines ranging from the financial industry to the sale of agricultural machinery.
Yanmar also intends to utilize its long heritage in technical innovation to provide agricultural solutions in the Philippines that go well beyond customer expectations.
No less than the Philippine Institute of Development Studies (PIDS) reported that thousands of hectares of lands in Nueva Ecija, Pangasinan, Quezon, Masbate, Ilocos Norte and Laguna are underutilized due to absence of advance and high tech agricultural equipment.
Even Agriculture Secretary Proceso Alcala has been urging farmers to invest in high-tech, advance farm equipment to increase their yields, saying any farmer can get a return of investment in less than two years for a P200,000 he spent in buying a tractor.
A study released by the Department of Agriculture said a smallest tractor can have the workload of four carabaos in just five hours.
The only additional expenses are the diesel and the fee for the operator.
Yanmar Philippines mother company in Japan, Yanmar Co. Ltd., is a very respected name in agricultural equipment production, having able to build machinery that can be used from plain land cultivation to aerial spraying.
The engines are used in a wide range of applications, including seagoing vessels, construction equipment, agricultural equipment and generator sets.
Within the last 20 years, Yanmar has also established a growing presence in the domestic UAV market in Japan and elsewhere, with small helicopter UAVs such as the Yanmar YH300 SL and Yanmar AYH-3, primarily used in agricultural spraying and other forms of aerial application. //


Author: Ed Velasco
Date: March 16, 2015
Source: The Daily Tribune

MANILA, Philippines - The government should continue its efforts to further enhance the utilization of free trade agreements (FTAs) especially by manufacturing and services sector companies, including setting up an FTA portal.
A new discussion paper published by the Philippine Institute for Development Studies (PIDS) titled How Are Firms Responding to Philippine Free Trade Agreements? made the proposal although the utilization rate of FTAs reported by the manufacturing sector is increasing compared with a 2010 study.
The two sectors report that FTA utilization is still hampered by a lack of information which, when available, was rated poorly in terms of quality and volume.
Identified as the main source of information for FTAs, the government needs to increase the efficiency scope, and reach of its promotional and technical training programs and to rely further on technology to deliver results, it said.
The Department of Trade and Industry (DTI) has made considerable efforts to increase FTA awareness through the conduct of Doing Business in FTAs (DBFTA) sessions nationwide, and the publication of a DBFTA Handbook, as well as FTA primers.
To complement these initiatives, the PIDS paper said the government needs to further promote FTAs by setting up a portal where information about the benefits of FTAs, the process of gaining access, the requirements and forms and other relevant information can be easily accessed or downloaded.
This FTA portal, which should be an improvement on what is currently offered on the DTI website, will most likely enhance FTA awareness, eventually translating into increased utilization levels, it said.
The paper noted that the FTA portal is not only cost-effective but also a means to promote transparency in the process of Certificates of Origin (COO) issuance, thus minimizing rent-seeking behaviour of the agencies involved in FTA implementation.
It said efforts should include reforms toward electronics COO and self-certification and linkage to the national single window.
This will improve timelines and ease the entry of micro, small and medium enterprises. Regional efforts to harmonize ROOs (rules of origins) can increase FTA utilization across ASEAN member-countries and pave the way for the forthcoming Regional Comprehensive Economic Partnership, the paper added.//


Author:
Date: March 16, 2015
Source: Philippine Star

ZAMBOANGA CITY -- The Zamboanga Peninsula is banking on the development of its champion products such as mango, abaca and sardines to cash in on the zero tariffs granted under the European Union-Generalized Scheme of Preferences Plus (EU-GSP+), to which the Philippines was admitted in December.

Department of Trade and Industry (DTI) Regional Director Sitti Amina M. Jain said the agency is helping small and medium enterprises (SMEs) develop products to make the region a key exporter to the EU, acknowledging the big gap between market potential and local capacity.

DTI is looking at the opportunities in terms of expansion of businesses, and the industries, therefore expanding opportunities for employment. We are looking at 200,000 jobs (nationwide) to be generated by the (GSP+) scheme, Ms. Jain said.

There are about 30,000 registered SMEs in the region.

Processed mango, for example, which is charged between 5% to 11% tariff under the regular GSP program, is one of the Philippine products that can now enter the EU market at zero tariff.

Zamboanga Peninsula, or Region 9, was the countrys number two producer of fresh mango in 2013, based on data from the Philippine Statistics Authority.

However, the majority of SME mango processors in the Philippines are located in Metro Manila and Cebu, according to a February 2013 study by the Philippine Institute for Development Studies.

Michael Vincent Cajulao, DTI Region 9 information officer, said the agency is cooperating with other government departments such as the Department of Science and Technology and the Food and Drug Administration in product development and standards.

Once we get in, even in just one of the 28 member countries, it will be easier for us to get into other markets, Mr. Cajulao said in a phone interview.

The EU-GSP+ will only be in effect within the next six to 10 years.

For abaca, another GSP+ item that used to be charged a 4.8% tariff, stakeholders in the region met with the DTI in January to consolidate a plan of action for the sectors sustainable growth.

Region 9s abaca production, based on data from the Bureau of Agricultural Statistics, more than doubled in 2011 to 631 metric tons (MT), grew to 675 MT in 2012 at 675 MT, but declined in 2013 to 589 MT.

The Philippines abaca exports, with have the United Kingdom as their biggest importer, enjoyed a 20.7% increase last year in the 11 months to November compared to the same period a year earlier. The Bicol region cornered the biggest share at 41%, followed by Eastern Visayas with 19.4% share and the Autonomous Region in Muslim Mindanao, 10.7%.

Sardines, a major fish catch in the region, is another potential sector for growth with preserved sardines now down to zero tariff from the previous 9%.

However, Roberto A. Baylosis, executive vice-president of the Southern Philippines Deep Sea Fishing Association, Inc. (SOPHIL), said that existing government processes are not conducive to business growth.

My personal opinion of what the commercial fishing industry would need from the government at this point is to eliminate, if not reduce, the burden to the commercial fishing due to too much red tape being enforced by the different government agencies concerned, Mr. Baylosis said in an e-mail interview with BusinessWorld.

Instead, (we must) continue and maintain the science-based study of fisheries for adoption of conservation measures and proper management, including an information campaign for the commercial fishing operators as to the correct period and the appropriate area of the fish stocks suitable for harvest, he added.

The Zamboanga City-based SOPHIL is composed of 12 commercial fishing companies operating within domestic waters and engaged mainly in harvesting only for the local market.

There are fish canning factories operating within the Zamboanga City Special Economic Zone.

Zamboanga Peninsula -- composed of the provinces of Zamboanga del Norte, Zamboanga del Sur, and Zamboanga Sibugay and the chartered city of Zamboanga -- saw a slowdown in its gross regional domestic product growth to 4.3% in 2013 from 12.9% the previous year due in part to power supply shortages and the impact of the three-week siege of Zamboanga City by members of the Moro National Liberation Front in September 2013. -- with a report from Marifi S. Jara

Author: Karel B. Mellanes
Date: March 16, 2015
Source: BusinessWorld

MANILA, Philippines"State-run corporations received a total of P80.44 billion in subsidies from the government last year, the highest annual amount to date and up 21.3 percent from P66.33 billion in 2013, latest documents from the Bureau of the Treasury showed.
Subsidies to government-owned and -controlled corporations (GOCCs) in 2014 exceeded those given during the previous year even as the amount distributed in December worth P14.12 billion was just more than half of the P27.22 billion distributed during the last month of 2013.
Subsidies from the national government cover operational expenses not being supported by corporate revenues and may as well be spent on specific projects and programs of GOCCs. Besides the grant of subsidies, the national government also extends financial support to GOCCs through equity as well as net lending.
Last year, the recipient of the biggest chunk of government subsidies was Philippine Health Insurance Corp. (PhilHealth), which got P35.33 billion or 43.9 percent of the total. The tax-exempt GOCC is being allocated funding in a bid to provide health insurance coverage as well as accessible and affordable healthcare services to all Filipinos. According to its website, PhilHealth covered 81.5 million beneficiaries (members and their dependents) as of mid-2014.
The other state-run corporations that received subsidies last year were Aurora Pacific Economic Zone and Freeport Authority (P48 million), Cultural Center of the Philippines (P245 million), Cottage Industry Technology Center (P22 million), Center for International Trade Expositions and Missions (P186 million), Development Academy of the Philippines (P138 million), Local Waterworks and Utilities Administration (P265 million) and Lung Center of the Philippines (P203 million).
Also infused with subsidies were National Dairy Authority (P299 million), National Electrification Administration (P5.64 billion), National Food Authority (P4.25 billion), National Housing Authority or NHA (P19.06 billion), National Home Mortgage and Finance Corp. (P500 million), National Irrigation Administration (P1.07 billion), National Kidney and Transplant Institute (P228 million) and National Power Corp. (P960 million).
The following GOCCs likewise were granted subsidies in 2014: Philippine Coconut Authority (P1.97 billion), Philippine Center for Economic Development (P21 million), Peoples Credit and Finance Corp. (P900 million), Philippine Crop Insurance Corp. (P1.16 billion), Philippine Childrens Medical Center (P365 million), Philippine Deposit Insurance Corp. (P2.79 billion), Philippine Heart Center (P280 million), Philippine Institute for Development Studies (P348 million), Philippine Institute of Traditional and Alternative Health Care (P49 million), Philippine National Railways (P138 million), Philippine Postal Corp. (P968 million) and Philippine Rice Research Institute (P547 million).//


Author: Ben de Vera
Date: March 16, 2015
Source: Philippine Daily Inquirer

Many of us take for granted the simple privileges of electricity, water, and food, without realizing that there are many of our countrymen who arent so lucky. According to the Philippine Institute for Development Studies, 16 million families didnt have electricity in 2013. This is what inspired Aisa Mijeno, an engineer and social worker, to invent a lamp that doesnt need electricity, batteries, or kerosene. It only needs salt and water.
Aisa was inspired to create this lamp on an immersion trip in 2011 to the Kalinga highlands, where she stayed with the Butbut tribe in Buscalan. Life in the mountains halts to a stop during sunset, because locals dont have access to electricity. They either have to make fire or walk for hours to the nearest town to buy fuel for their lamps.

A sample of SALt
Mijenos invention, called SALt, or Sustainable Alternative Lighting, is created by dissolving two tablespoons of salt in a glass of water. The lamp is equivalent to seven candles or the brightness of a low-LED bulb, and can last up to eight hours. According to Mijeno:

If you did the lemon-battery experiment, thats basically it. Two different metals submerged in electrolytes will produce electricity. For us, we used saltwater. It is an open science so I will not be surprised if there are existing similar technologies developed out there.

Aside from lighting up, SALt can charge devices through a USB port, but it cant do both at the same time.

The idea has been on Mijenos mind for a while, but she didnt have the resources to try it out. Luckily, a technopreneur bootcamp in De La Salle Lipa hosted by Ideaspace Foundation called for entries in its yearly startup competition. She pitched her idea and was accepted. The incubator provided funding and soft support, which led to SALt.

According to Mijeno, SALt can prevent families from turning to dangerous and expensive alternatives like kerosene. Seventy percent of the earths surface is saltwater, a crucial ingredient in her invention.

Just last year, Mijeno won the Peoples Choice Award at Startup Nations Summit 2014 held in Seoul, South Korea.//




Author: Koji Arsua
Date: March 15, 2015
Source: When in Manila

FUNDS for the construction and upkeep of the countrys health infrastructure, as well as for the housing requirements of millions of Filipinos, accounted for the bulk of subsidy money spent on the sectors, data from the Department of Finance (DOF) show.

Total government subsidies extended by the national government to government-owned and -controlled corporations (GOCCs) surged by 21 percent in 2014.
Data from the DOF show total subsidies in 2014 amounting to P80.44 billion.
This was P14.11 billion higher than subsidies granted in 2013 totaling only P66.33 billion and an increased from the past three years as the subsidies spent in 2012 amounted only to P42.64 billion.
The Philippine Health Insurance Corp. remained the biggest recipient, getting a total of P35.33 billion in 2014, followed by the National Housing Authority, which received P19.06 billion in subsidies.
The Philippines has a rather grave housing backlog, the deficiency of which has ballooned over the past 10 years from some 2 million units to more or less 5.5 million, based on private-sector estimates.
The other GOCCs, which received at least a billion in government subsidies, are National Electrification Administration (P5.65 billion); National Food Authority (P4.25 billion); Philippine Deposit Insurance Corp. (P2.79 billion); Philippine Coconut Authority (P1.97 billion); Philippine Crop Insurance Corp. (P1.15 billion); and National Irrigation Administration (P1.07 billion).
Some of the other GOCCs, which received big subsidies from the national government, include Philippine Postal Corp. (P968 million); National Power Corp. (P960 million); Peoples Credit and Finance Corp. (P900 million); Social Housing Finance Corp. (P799 million); Social Security System (P772 million); Philippine Rice Research Institute (P547 million); National Home Mortgage Finance Corp. (P500 million); Tourism Promotions Board (P500 million); Philippine Childrens Medical Center (P365 million); and Philippine Institute for Development Studies (P348 million).//


Author: David Cagahastian
Date: March 15, 2015
Source: Business Mirror

In September 2000, leaders from across the world gathered at the United Nations for the Millennium Summit, and adopted the Millennium Declaration, which committed humanity to achieving the Millennium Development Goals (MDGs) by 2015.

The MDGs consist of eight goals, on reducing poverty and other related aspirations, such as achieving universal primary education (i.e. ensuring that every child, regardless of sex, goes to primary school and completes primary education).

This effort brought about concerted efforts by governments, the development community, and various stakeholders to meet the MDGs, and to accelerate progress in meeting them. Examinations by the development community, such as the Asian Development Banks Independent Evaluation Department, and the United Nations Childrens Fund, have indicated considerable progress particularly on education-MDGs, although progress has been very uneven not only across countries, but within countries.

Globally, an estimated 25 million children, 15 million girls and 10 millions boys, are likely never to go to school. In addition, older children appear to be more likely to be out-of-school than their younger counterparts. Further, a bigger share of primary- and secondary-aged children from poor families do not go to school compared to children from the higher income distribution.

Children residing in rural areas are also far more likely to be out of school (and even engaged in economic activities) than those from the urban areas. The disparities between rural folk and urban folk, as well as between the poor and non-poor, ultimately suggest that a primary reason for the lack of participation of children is economic.
Social programs

In the Philippines, the government decided to spend much more on social programs (than its predecessors), including increasing the budget of the Department of Education (DepED) to address input deficits, i.e., building more schools and classrooms, purchasing more chairs, hiring more teachers, among others, as well as providing resources to address demand-side issues.

For 2015 alone, the DepED budget in this case totals P361.7 billion, representing an increase of 18.6% from the previous year, which included a P53.9-billion allocation for Basic Education Facilities, sufficient to build 9,500 classrooms, repair over 31 thousand classrooms, develop over 13,000 water and sanitation facilities, and purchase 1.3 million chairs.

Governments interventions on the demand side include a massive investment inPantawid Pamilya, the conditional cash transfer program implemented by the Department of Social Welfare and Development (DSWD), aside from more attention to feeding severely wasted children in schools and in day care centers.

The CCT Program has been extensively scrutinized, with the increased resources provided to Pantawid. Rightfully, every program involving public funds should undergo careful examination, but examinations must be fair.

It has been suggested that the CCT is ineffective since official poverty rates from the Family Income Expenditure Survey (FIES) of the Philippine Statistics Authority (PSA) have remain unchanged from 2006 to 2012 despite the huge cost for implementingPantawid.
In a previous article, we pointed out that the main purpose of the CCT is to increase school participation of children from poor families, and that poverty rates would not be expected to change considerably in the short term since the maximum cash support given to beneficiary households is far less than what they would require to cross the poverty line. Effects on income poverty would be expected when the children beneficiaries join the labor market with improved education attainments.
Education indicators

Both the first wave and second wave of impact evaluation studies by the World Bank as well as an analytical report at the Philippine Institute for Development Studies suggest that Pantawid Pamilya has resulted in improved school participation for beneficiary households, compared to households who are not beneficiaries ofPantawid.

In the following table, we show education indicators from 2007 to 2013 sourced from the Annual Poverty Indicator Survey (APIS), a yearly survey conducted by the Philippine Statistics Authority (PSA) on years when the PSA does not conduct the triennial FIES.

We see that while about 90% of children aged five to fifteen were in school from 2007 to 2010, the proportion of five-to-fifteen year old children that were in school has gone up to about 95 percent by 2013. In addition, while in 2007, there were an estimated 3.01 million out-of-school children (OOSC) between five to fifteen years old, the magnitude of OOSC has gone down to 1.2 million by 2013.
Table 1.
Selected Education Indicators on School Participation and Out-of-School Children among Children Aged Five to Fifteen years Old


Education Indicator 2013 2011 2010 2008 2007
School Participation Rates 94.79 92.00 89.58 90.73 89.97
Adjusted Net Attendance Rates 85.86 83.91 80.39 79.62 78.99
Number of Out of School Children (OOSC) in millions 1.20 2.01 2.60 2.33 3.01
Note: Authors calculations from APIS 2007, 2008 and 2010, 2011, and 2013 (conducted by PSA).
Whether we examine school participation rates, or adjusted net attendance rates (which refer to the ratio of the number of children in an age range that attends the proper education tier or higher relative to the number of children of the school-age range) from the APIS for the periods 2007 up to 2013, we find clear evidence that governments investments in Pantawid and in higher budgets for DepED have paid off. These investments have contributed to remarkably improved participation of children in basic education.

The big improvements between 2010 and 2013 (see Figure 1) come after government through DepED officially started to make Kindergarten mandatory for incoming primary school students, and DSWD was provided more investments for the CCT to encourage children from poor families to send their children to school.


Figure 1. School Participation of Children Aged Five to Fifteeen Years old, 2010 and 2013
Note: Authors calculations from APIS 2007, 2008 and 2010, 2011, and 2013 (conducted by PSA).

Years ago, we pointed out in a PIDS policy note that in the Philippines, there are also gender disparities in school attendance, but with reversed trends from that of the world: girls are becoming more educated than boys.

Even recent data from APIS 2013 (as indicated in Figure 1) still shows that not only are school participation rates lower among older children among the five to fifteen year old group, but in particular, teen-aged boys are more likely to be out of school than their girl counterparts.

Opportunity costs for keeping teen-aged boys in school are higher. Uniform education cash grants of 300 pesos per child beneficiary in Pantawid does not address the disparities in school participation, especially between older secondary age children (and younger ones), and between boys and girls.

This school year, the DSWD started to implement an Expanded CCT (ECCT) to allow child beneficiaries to complete their secondary school education, with P500 being provided to each ECCT high school beneficiary.

Differentiated grants that account for sex and age though may have to be implemented by DWSD if it were to address the clear difference in school participation between older versus younger aged children, and between boys and girls.

In addition, as the following Table shows, the proportion of secondary-aged children that are OOSC appear to be highest among the poor, and among very poorest regions (such as ARMM, and Bicol), which suggests that economic reasons still prevent children from exercising their right to basic education.

Table 2
Percentage of secondary school age children that are out-of-school, by age, sex and other characteristics
MALE FEMALE BOTH SEXES
OOSC rate No. of children OOSC rate No. of children OOSC rate No. of children
TOTAL 9.37 403,626 4.29 178,619 6.88 582,245
Age (in Years)
12 2.70 29,812 1.68 17,404 2.20 47,215
13 6.44 72,139 3.21 34,773 4.85 106,912
14 10.09 98,428 3.48 34,204 6.78 132,631
15 18.38 203,248 8.74 92,238 13.67 295,487
Per Capital Income Quintile
Poorest 15.03 168,157 7.74 80,206 11.52 248,362
Second 12.28 113,449 4.09 39,621 8.09 153,071
Middle 8.62 78,989 3.99 32,805 6.43 111,794
Fourth 3.36 24,305 2.62 19,118 2.99 43,423
Richest 3.01 18,726 1.14 6,868 2.09 25,595
Region
Region I - Ilocos Region 11.52 26,279 3.87 7,171 8.09 33,450
Region II - Cagayan Valley 9.09 13,272 2.33 3,096 5.87 16,368
Region III - Central Luzon 9.74 43,113 4.25 19,926 6.91 63,040
Region V- Bicol 12.17 34,008 6.56 18,447 9.36 52,454
Region VI - Western Visayas 7.28 25,464 0.95 3,218 4.16 28,682
Region VII - Central Visayas 12.14 37,036 2.73 7,481 7.69 44,517
Region VIII - Eastern Visayas 9.00 20,910 6.00 12,448 7.59 33,358
Region IX - Zamboanga Peninsula 9.46 16,071 4.49 7,408 7.01 23,479
Region X - Northern Mindanao 10.25 20,047 5.93 12,797 7.99 32,843
Region XI " Davao 9.04 18,116 2.44 3,822 6.15 21,938
Region XII - SOCCSKSARGEN 10.31 22,061 5.79 12,502 8.04 34,563
National Capital Region 5.50 25,475 1.24 5,851 3.34 31,326
Cordillera Administrative Region 17.59 12,535 3.84 2,709 10.75 15,245
Autonomous Region in Muslim Mindanao 15.41 30,986 15.02 28,343 15.22 59,329
Region XIII - Caraga 6.73 8,571 3.25 4,283 4.96 12,854
Region IVA - CALABARZON 7.30 38,407 4.18 21,446 5.76 59,853
Region IVB - MIMAROPA 7.36 11,275 5.53 7,669 6.49 18,945
OOSC among five to fifteen-year-old children remains a challenge, especially in ARMM, as security issues may also be preventing families from sending their kids to schools, thus giving another reason why government must exert more efforts in ensuring lasting peace, aside from working on a more inclusive development.
Table 3. Percentage of OOSC aged 5 to 15 to Tal Number of 5 to 15 Year-Old Children in 2013, by Sex and by Region
Source: Authors' calculations from APIS 2013, PSA

Reassess uniform grants
REGION MALE FEMALE BOTH SEXES
Region I - Ilocos Region 6.63 4.39 5.56
Region II - Cagayan Valley 5.81 2.26 4.12
Region III - Central Luzon 6.79 4.27 5.56
Region V- Bicol 5.66 4.84 5.27
Region VI - Western Visayas 4.20 0.65 2.47
Region VII - Central Visayas 6.92 2.68 4.87
Region VIII - Eastern Visayas 5.76 3.80 4.81
Region IX - Zamboanga Peninsula 7.21 4.06 5.66
Region X - Northern Mindanao 6.28 3.69 5.01
Region XI " Davao 5.65 2.91 4.33
Region XII " SOCCSKSARGEN 9.00 5.79 7.42
National Capital Region 4.80 2.43 3.64
Cordillera Administrative Region 10.65 4.63 7.72
Autonomous Region in Muslim Mindanao 17.09 16.35 16.73
Region XIII " Caraga 4.85 3.48 4.18
Region IVA " CALABARZON 4.96 1.94 3.50
Region IVB " MIMAROPA 5.27 5.80 5.53
TOTAL 6.44 3.90 5.21
In conclusion, recent data from 2013 (in comparison with data from 2007 and 2010) sourced from results of the APIS show that governments investments in basic education are working.

It will be important though to re-assess the uniform grants given in Pantawid, although the current cash incentive for high school beneficiaries is much higher (500 pesos) than for pre-primary and primary school beneficiaries (300 pesos). Provision for higher than usual Pantawid cash incentives should be similarly provided, for boys to address the disparities between older boy children whose opportunity costs for going to school and staying in school are higher.

A graduation gift may be an extra incentive to complete schooling. In Mexicos CCT, additional cash provisions for females were provided a decade ago, when girls were at a disadvantage in school participation, and for children nearing the last stage of the education cycle, which led to a considerable bridging of the gender divide in Mexico, and improvements in school completion.

The extension of support to high school beneficiaries in Pantawid is welcome but further deepening of the impact of the CCT could result by increasing support for older children to encourage school completion, and for boys to address gender disparities in school outcomes currently in favor of girls.

In isolation, Pantawid will not be enough to reduce poverty in the short term, but they help to incentivize the poor to make investments in their human capital.

Current investments in the social sector need to be sustained and deepened so government can help ensure that no one, whether poor or non-poor, male or female, is left behind in education attainments as the country pursues a path of growth, prosperity and development. " Rappler.com


Author: Jose Ramon G. Albert and Clarissa David
Date: March 11, 2015
Source: Rappler.com

March 8 " International Womens Day IWD) " was celebrated worldwide with the usual marches, forums, and awards ceremonies, many of which were intended to remind everyone of the importance of recognizing the rights of womenfolk who make up half of the population of the world. Celebrations normally focus on herstory " gains that have been achieved in such areas as education, employment, status at home, and in public life, health and welfare, and the struggles and hurdles along the way.
In a review of the status of womens rights in the country over the past 50 years, Assistant Secretary Lila Ramos Shahani of the Human Development and Poverty Reduction Cabinet Cluster noted that a disparity exists between the fulfillment of their needs and the services and protection afforded them by the state. This continues despite the establishment of mechanisms intended to upgrade the status of women during the past administrations.
Her review cited the establishment of the National Commission on the Role of Filipino Women (now the Philippine Commission on Women) in 1975 during the Marcos administration. The Philippine Development Plan was implemented during the Cory Aquino presidency. It was during the administration of Fidel V. Ramos that the Gender and Development Budget and full representation of women in the Social Service Commission was introduced. The Philippine Agenda for Women Empowerment was the principal contribution of the Estrada administration. And the Framework Plan for Women and Magna Carta for Women, was the primary innovation in the area of promoting womens status during the presidency of Gloria Macapagal Arroyo.
But with the envisioned integration into the APEC economies and with ASEAN integration, the challenges are expected to become even greater. A paper prepared by the Philippine Institute of Development Studies (PIDS) notes that as the country makes this transition, it is important for the gender issue to penetrate hard areas like finance, energy, infrastructure, and the like. Thus, to make these areas more gender-sensitive, gender must not stay enclosed in social development (like health and education) and recommends that women must be prepared to compete in the global marketplace through such means as empowering women enterprises, making women-owned enterprises competitive, and building resilience and sustainability.
While milestones insofar as the integration of women in the area of politics, law enforcement, and security is concerned, the vision of gender equity has been hampered by weak enforcement of the law. Thus, some of the policy issues focus on the need to use quotas to boost the number of woman legislators, support of womens legal organizations, support of one-stop shops to reduce attrition in the justice chain, to put more women on the front line in law enforcement, implement gender-responsive reparations programs, and increase womens access to courts during and after conflict.
Here is also a viewpoint from a feminist. This reflection by 68-year-old Jurgette Honculada, the better half of another human rights leader, Bong Malonzo, is one of the nicest ways of remembering IWD as it celebrates the role of being a nanay and a lola. She describes herself as a mellowed feminist, in fact, a lola feminist. Here, we can empathize and identify with her in this role, feel her sense of wonder at being a lola, and how this has brought her greater balance and equanimity.
Jurgette writes: There still is a fire in the belly, but without the apocalyptic sense of young know-it-all feminists. Let me now greet you with some thought on what this interface of age and gender has brought me. First of all, a deepened sense of wonder. As I say it, it takes at least four miracles of produce an apo: first, you must meet and fall in love with someone; second, you must stay with that someone long enough to make/have a baby; third, the baby must grow up to adulthood and fall in love; and fourth, your son/daughter must stay with the partner long enough to make/ha ve a baby. Any break in that chain can spell disaster. My email is florangel.braid@gmail.com//

Author: Florangel Rosario Braid
Date: March 10, 2015
Source: Manila Bulletin

THE umbrella organization of exporters in Cebu welcomes the Senates promise to fast-track the passage of bills that promote market competition and enhance trade facilitation, saying this will help players become more competitive and secure a solid footing in the Asean global trade.
Senate President Franklin Drilon is eyeing the passage of the Fair Competition Act this June, after the Senate has approved its version of the bill.
This is timely news as we are moving into full integration of Asean. The Philippines has never had a policy on fair competition. That is why we have so many monopolistic institutions, cartels and powerful business blocs, Philippine Exporters Confederation, Inc. (Philexport) Cebu executive director Fred Escalona said Monday.
Once the bill is enacted into law, the measure will promote economic efficiency in trade, industry and commerce through the prohibition of anti-competitive agreements, abuse of dominant positions and anti-competitive mergers.
Policy
The passage of the competition law, which we expect by June of this year, will ultimately bring about a dynamic, sustainable, inclusive economic growth and national progress, said Drilon during the Arangkada Forum held in Manila.
According to Escalona, a competition law and policy has already been drafted by Asean Economic Community, which has provisions to protect the consumer from powerful business blocs and benefit them in terms of better pricing and improved quality of products they buy.
I am excited about the passage of this act. However, the implementing commission should be under the wings of the Department of Trade and Industry and not the Department of Justice, said Escalona.
We must put an end to market price manipulation, market distortions and constriction of operation by smaller players who have no chance against big business and cartels, he added.
Two prominent economists in the country who visited Cebu last year were urging local business players in the Visayas to back the passage of the competition bill.
Lagging
Of the 10 member-countries in the Asean region, countries like the Philippines, Brunei Darussalam, Cambodia, Laos, and Myanmar dont have specific competition legislation yet.
We are lagging behind top Asean countries in terms of having a good and strong competition law. This law is important because it levels the playing field, protects consumers and eliminates monopolies and cartels, said Gilberto Llanto, president of the Philippine Institute of Development Studies (Pids).
Importance
Llanto noted foreign investments in the Philippines will grow if there is a fair business environment. This will also help micro, small and medium enterprises (MSMEs) compete with large enterprises and stay competitive among their Asean peers.
Cielito Habito, also an economist, stressed the importance of having a competition law to attain a more inclusive growth. This will also strengthen the countrys footing in the Asean economic landscape.
This law is important for a country that lacks inclusive growth because it will level the playing field, thus, allowing small players to also attain business growth, said Habito.
Competitiveness
Aside from passing the Competition Bill, Drilon said the Senate also intends to pass other measures that will support the countrys thrust towards increased competitiveness.
These include the creation of two new offices: a Philippine Trade Representative Office which will serve as the countrys central agency tasked to formulate a cohesive trade strategy; and the Department of Information and Communications Technology (DICT) to support the development of ICT systems.//


Author: Katlene O. Cacho
Date: March 10, 2015
Source: Sun Star Cebu

ACCORDING to an Inquirer news article, a group of college professors, school staff and their supporters who call themselves The Coalition for K to 12 Suspension called on President Benigno Aquino 3rd to suspend the K to 12 program.
They vowed to challenge it before the Supreme Court for failing to protect the labor rights of affected teachers.
Under the enhanced basic education program of the Department of Education"called K to 12 or Kindergarten plus Grades 1-12"a student will be required to undergo kindergarten, six years of elementary, four years of junior high school and two years of senior high school.
The implementation of universal kindergarten began in school year 2011-2012, followed by a new curriculum for Grade 7 in school year 2012-2013.
School year 2016-2017 will mark the nationwide implementation of the Grade 11 curriculum, to be followed by the Grade 12 curriculum in school year 2017-2018.
The Coalition for K to 12 Suspension will file in the Supreme Court on March 12 a petition seeking a temporary restraining order or writ of preliminary injunction against the program, according to Rene Tadle, who is also a convenor of the Council of Teachers and Staff of Colleges and Universities in the Philippines.
The group would also hold a mass action on May 9 to voice their opposition to the K to 12 curriculum.
In a press briefing, Tadle said the K to 12 law failed to provide protection for the labor rights of the 56,771 teachers and 22,838 non-teaching personnel who stand to lose their jobs and their hard-won security of tenure as a result of the program.
Because of the additional two years of high school, very few incoming college freshmen are expected in 2016, the start of the transition period for the program, leaving college professors with little to do and opening up the possibility that colleges and universities would lay them off or reduce their teaching load.
The loss of tenure also means the diminution of teachers benefits, which could lead to their underemployment and contractualization, Tadle said.
Even before 2016, teachers and non-teaching staff, together with their families and dependents, have been suffering from undue stress, anxiety and anguish, brought about by the specter of early separation, forced retirement, constructive dismissal, diminution of salaries and benefits, labor contractualization, and general threat to self-organization, Tadle said, reading from the coalition statement.
But teachers cannot be laid off just like that. Indeed, no company is allowed to lay off employees in lieu of anticipatory loss as it would be in violation of Article 283 of the Labor Code.
Teachers who would be laid off because of the K-12 implementation have a legitimate case or grievance.
In a previous column I mentioned how some private colleges and universities are quietly making adjustments to accommodate students who intend to skip Grades 11 and 12 in order to make sure they would have some college students during the crucial transition or the years where there will hardly be any college enrollees.
Schools stand to lose up to P150 billion due to decreased enrollment over five years once senior high school is fully implemented in 2016.
The Coordinating Council of Private Educational Associations (Cocopea) said that with the start of the added two-year senior high school, colleges would have no freshmen enrollees in school years 2016-2017 and 2017-2018.
The decreased enrollment is expected to carry over in the next three years or until school year 2020-2021, Cocopea said.
The Council of Teachers and Staff of Colleges and Universities said that based on their estimates, universities and colleges will lose 500,000 freshman college enrollees and more than 300,000 sophomore college enrollees once the implementation of the senior high school program starts in 2016.
What happens if the Supreme Court finds favor with The Coalition for K to 12 Suspensions petition to stop the K-12 curriculum? As of now, it is already being implemented.
Another important question is whether the government can find the P30 billion a year it needs to spend until 2020 to meet the public classroom and staffing needs for the K to 12 Program.
That is how much it needs according to a recent study released by the Philippine Institute for Development Studies (PIDS).
In a policy note, titled K to 12 reform: Implications of adding Grades 11 and 12 on the higher education sub-sector, PIDS senior research fellow Rosario G. Manasan said the government must add some 23,812 classrooms and 38,708 teachers for school year (SY) 2017 to 2018 period.
The budgetary support needed for the SHS [senior high school]program is estimated to be equal to P27 billion in SY 2015-2016, P37 billion in SY 2016-2017, P28 billion in SY 2017-2018, and an average of P33 billion over the SY 2018 [to] 2020 period, Manasan said.
Obviously, K to 12 cant work without teachers to teach subjects or classrooms to hold classes in.
There are so many kinks to the K to 12 curriculum that the government has to iron out and I hope President Aquino doesnt just kick the can to the next administration.

Author: ERNESTO F. HERRERA
Date: March 09, 2015
Source: Manila Times

State think tank Philippine Institute for Development Studies said Sunday the government must continue to create policies that will empower women.

PIDS consultant Lucita Laz detailed in her study the different obstacles women entrepreneurs face in the Philippines.

The study highlights the challenges of policymakers in helping women entrepreneurs boost their business ventures amid the Asean economic integration and freer trade.

Even with the Philippines coming ahead in international gender indices and local literacy rate surveys, affirming that Filipino women outperform Filipino men, experts say that translating these capabilities into business and leadership opportunities is still a work in progress, Lazo said.

She said more Filipino women are educated but mens employment still exceeded that of womens.

The Philippines boasts of having the highest ratio of female-to-male business leaders, yet experts believe that opportunities for women continue to be held back by oppressive conditions, and most of all, by persistent economic inequality, she said.

Lazo said the challenges in empowering women included lack of access to resources; the sustainability of their businesses; lack of a business discipline, preparation and readiness for changing economic outlooks; lack of women representatives on decision making levels; lack of access to health and socio-legal protection; and a simple lack of information on the part of leaders and policymakers.

Despite all the government projects targeted to provide information, service facilities, technology and innovation to women in SMEs and microenterprises, access is weakened by a network of problems, she said.

Author: Jennifer Ambanta
Date: March 09, 2015
Source: Manila Standard Today

Only one-third of Filipino firms surveyed by the government make use of the countrys free-trade agreements (FTAs), according to a study released by state-owned think tank Philippine Institute for Development Studies (PIDS).

The study, titled How Are Firms Responding to Philippine Free Trade Agreements?, authors led by PIDS Senior Research Fellow and Trade Assistant Secretary Rafaelita M. Aldaba, said that, out of 108 firms surveyed, only 33, or 30.6 percent, are FTA users. This utilization rate may be considered to show a weak inclination to use FTAs in trade transactions, especially since exporters and importers, together, constitute a huge bulk of the sample, the study stated.

Data showed that most of the FTA users were medium-sized firms that employ 51 to 300 workers. Most of the FTA users were also firms with foreign equity.

The study also stated that over 75 percent, or 25 out of the 33 FTA users, are firms fully or partially owned by foreigners, while only 7 of the 26 domestic firms state that they use FTAs.

A majority of firms [70 percent] currently do not use FTAs, the study stated. Topping the list [of reasons for nonuse of FTA among firms] is lack of information, followed closely by using another scheme.

The study stated that small- and medium-sized firms said they lacked information in using FTAs. Large firms, on the other hand, said they are already located in economic zones.

The large firms said the privileges granted to firms in economic zones include duty- and tax-free importation of raw materials, supplies, capital equipment and spare parts.

The study noted that 24 percent of the large firms and 33 percent of the medium-sized sample firms are located in economic zones. Small trade volume and, to some extent, complicated COO [Certificate of Origin] requirements are also identified as constraints to using FTAs, the study stated.

Preparing all the documents entails work that creates fixed costs, so that only those that can afford to cover the costs are inclined to use an FTA scheme. In the Philippines it was noted that, despite the government efforts to streamline customs processes, some procedural lapses persist, it added.

The study recommended the government, through the trade department, to initiate promotional campaigns and technical trainings live and online.

The information to be disseminated must be targeted toward manufacturing firms in export-processing and special-economic zones to educate them on the increased benefits of using FTAs beyond the zone-specific benefits that they already receive.

The study also urged the government to conduct a review of the COO access procedure to simplify the process. This will negate apprehensions that first-time FTA users may have.

Further, computerizing the COO issuances must also be pursued and integrated in the National Single Window.

Author: Cai Ordinario
Date: March 09, 2015
Source: Business Mirror

The Senate is bent on passing a bill creating the Philippine Trade Representative Office (PTRO), which is similar to the US Trade Representative (USTR) but which was opposed by the Department of Trade and Industry, to ensure the country will have a central agency tasked to formulate a cohesive trade strategy.

Senate President Franklin Drilon has made the assurance of the passage of this trade bill during a recent forum of business groups under the Joint Foreign Chambers (JFC).

We intend to pass measures to establish institutions that would

support our move towards liberalization, said Drilon adding this measure is among other bills that are expected to be passed in June this year.

Already, Sen. Bam Aquino, chair of the Senate committee on trade, commerce and entrepreneurship has already conducted the hearing on the proposed bill last February 18.

The PTRO will be tasked to improve and strengthen the negotiating capabilities of the country to ensure that international trade or investor agreements will only be entered into when these are deemed beneficial to the Filipino people.

Essentially, the creation of PTRO will address the alleged lack of one efficient office that formulates and carries out the countrys trade policies to promote and protect domestic products as well as the local market and economy from unfair trade practices.

The said bills are also meant to address the stakeholders needs and the right of the people to participate in economic decision-making. Both goals are aimed at promoting greater accountability of trade negotiators with regard to trade and investment agreements, more coherence and cohesiveness in trade negotiating strategy, and to involve Congress in formulating a negotiating mandate before any negotiations take place.

There have been various versions on the proposed PTRO both in the Senate and House. Senate Bill 1149 was filed by Antonio Trillanes, IV.

As the numbers of our countrys trade and investment agreements with other countries continue to grow, the Philippines, however, lacks a dedicated government agency that consolidates and studies the impact of these agreements vis--vis our development goals and national interest, Trillanes said.

The PTRO will become the central agency responsible for all these trade agreements. It will also serve as the chief trade negotiator of the government.

The proposed bill also seeks to create a Multi-Sectoral Advisory Committee to be composed of representatives from various industries that are broadly representative of key economic sectors and groups affected by trade.

The Trade and Industry has opposed the creation of the PTRO stressing it will just create inefficiency and redundancy in trade negotiations, which are currently undertaken by a competent government body, the Bureau of International Trade Relations.

In its position paper submitted to Rep. Romeo M. Acop, chairperson of the House committee on government reorganization, DTI Secretary Gregory L. Domingo conveyed his strong reservations over House Bill Nos. 1690 and 2770 entitled, An Act Creating the Philippine Trade Representative Office, Appropriating Funds Therefor and For Other Purposes.

The Department puts forward its strong reservations on the passage of the proposed legislative measure because they derogate upon the functions and jurisdiction of the DTI, the agency which has developed expertise in trade negotiations and in forging trade agreements with other countries, Domingo said.

Domingo pointed out that trade policy is a function expressly conferred by law to DTI under Executive Order No. 133.

Given such mandate, Domingo said the DTI has the expertise in formulating and implementing industrial and investment policies as well as domestic trade policies.

Segregating the inextricably-linked trade and industry policies causes ineffectiveness in both areas, thereby hindering their full potential to serve overall national interest.

Splitting international trade from domestic trade and transferring it to the PTRO will cause redundancy and overlapping of work with the DTI.

The bill has proposed to carve out the various line agencies sitting in the Tariff and Related Matters to comprise PTRO, but Domingo said this may result in administrative nightmare not only it will require huge resources but also because this will cause dislocation land demoralization of people. This will also undermine the rationalization undertaken by various industries.

DTI, for instance, is currently implementing its rationalization plan, which may be nipped in the bud should the proposed transfer be carried out, Domingo said.

The DTI position paper further cited a discussion paper prepared by the Philippine Institute for Development Studies (PIDS) which pointed out that the proposed creation of a wholly-separate Cabinet-level agency dedicated solely to international trade negotiations may not be feasible due to budgetary and fiscal constraints and other political distractions.

PIDS instead proposed that a second option is the strengthening of the current TRM system, particularly the role of the Bureau of International Trade Relations (BITR).

Creating another agency with the same functions as an existing institution would create redundancy in powers and a layer of bureaucracy, thus leading to inefficiency, he added.//


Author: Bernie Magkilat
Date: March 08, 2015
Source: Manila Bulletin

The Senate is bent on passing a bill creating the Philippine Trade Representative Office (PTRO), which is similar to the US Trade Representative (USTR) but which was opposed by the Department of Trade and Industry, to ensure the country will have a central agency tasked to formulate a cohesive trade strategy.

Senate President Franklin Drilon has made the assurance of the passage of this trade bill during a recent forum of business groups under the Joint Foreign Chambers (JFC).

We intend to pass measures to establish institutions that would

support our move towards liberalization, said Drilon adding this measure is among other bills that are expected to be passed in June this year.

Already, Sen. Bam Aquino, chair of the Senate committee on trade, commerce and entrepreneurship has already conducted the hearing on the proposed bill last February 18.

The PTRO will be tasked to improve and strengthen the negotiating capabilities of the country to ensure that international trade or investor agreements will only be entered into when these are deemed beneficial to the Filipino people.

Essentially, the creation of PTRO will address the alleged lack of one efficient office that formulates and carries out the countrys trade policies to promote and protect domestic products as well as the local market and economy from unfair trade practices.

The said bills are also meant to address the stakeholders needs and the right of the people to participate in economic decision-making. Both goals are aimed at promoting greater accountability of trade negotiators with regard to trade and investment agreements, more coherence and cohesiveness in trade negotiating strategy, and to involve Congress in formulating a negotiating mandate before any negotiations take place.

There have been various versions on the proposed PTRO both in the Senate and House. Senate Bill 1149 was filed by Antonio Trillanes, IV.

As the numbers of our countrys trade and investment agreements with other countries continue to grow, the Philippines, however, lacks a dedicated government agency that consolidates and studies the impact of these agreements vis--vis our development goals and national interest, Trillanes said.

The PTRO will become the central agency responsible for all these trade agreements. It will also serve as the chief trade negotiator of the government.

The proposed bill also seeks to create a Multi-Sectoral Advisory Committee to be composed of representatives from various industries that are broadly representative of key economic sectors and groups affected by trade.

The Trade and Industry has opposed the creation of the PTRO stressing it will just create inefficiency and redundancy in trade negotiations, which are currently undertaken by a competent government body, the Bureau of International Trade Relations.

In its position paper submitted to Rep. Romeo M. Acop, chairperson of the House committee on government reorganization, DTI Secretary Gregory L. Domingo conveyed his strong reservations over House Bill Nos. 1690 and 2770 entitled, An Act Creating the Philippine Trade Representative Office, Appropriating Funds Therefor and For Other Purposes.

The Department puts forward its strong reservations on the passage of the proposed legislative measure because they derogate upon the functions and jurisdiction of the DTI, the agency which has developed expertise in trade negotiations and in forging trade agreements with other countries, Domingo said.

Domingo pointed out that trade policy is a function expressly conferred by law to DTI under Executive Order No. 133.

Given such mandate, Domingo said the DTI has the expertise in formulating and implementing industrial and investment policies as well as domestic trade policies.

Segregating the inextricably-linked trade and industry policies causes ineffectiveness in both areas, thereby hindering their full potential to serve overall national interest.

Splitting international trade from domestic trade and transferring it to the PTRO will cause redundancy and overlapping of work with the DTI.

The bill has proposed to carve out the various line agencies sitting in the Tariff and Related Matters to comprise PTRO, but Domingo said this may result in administrative nightmare not only it will require huge resources but also because this will cause dislocation land demoralization of people. This will also undermine the rationalization undertaken by various industries.

DTI, for instance, is currently implementing its rationalization plan, which may be nipped in the bud should the proposed transfer be carried out, Domingo said.

The DTI position paper further cited a discussion paper prepared by the Philippine Institute for Development Studies (PIDS) which pointed out that the proposed creation of a wholly-separate Cabinet-level agency dedicated solely to international trade negotiations may not be feasible due to budgetary and fiscal constraints and other political distractions.

PIDS instead proposed that a second option is the strengthening of the current TRM system, particularly the role of the Bureau of International Trade Relations (BITR).

Creating another agency with the same functions as an existing institution would create redundancy in powers and a layer of bureaucracy, thus leading to inefficiency, he added.//


Author: Bernie Magkilat
Date: March 08, 2015
Source: Manila Bulletin

The government must spend over P30 billion a year until 2020 to meet the public classroom and staffing needs under the K to 12 Program, according to a study released by the Philippine Institute for Development Studies (PIDS).

In a policy note, titled K to 12 reform: Implications of adding Grades 11 and 12 on the higher education subsector, PIDS senior research fellow Rosario G. Manasan said the government must add some 23,812 classrooms and 38,708 teachers for school year (SY) 2017 to 2018 period.

The budgetary support needed for the SHS [senior high school]program is estimated to be equal to P27 billion in SY 2015-2016, P37 billion in SY 2016-2017, P28 billion in SY 2017-2018, and an average of P33 billion over the SY 2018 [to] 2020 period, Manasan said.

Allowing HEIs [higher education institutions] to offer the SHS program, at least in the interim, is a win-win solution, she added.

Allowing higher education institutions to offer the SHS will enable the Department of Education (DepEd) to construct classrooms on a staggered basis.

The author also stated that it would prevent private HEIs from retrenching faculty members who will have no students in the 2016 to 2019 period.

She also said the current HEI faculty has the teaching expertise to lecture on higher-level subjects required in the new SHS curriculum.

Manasan added that this will ensure that the resources of state universities and colleges are put to optimum use instead of being underutilized.

Note that the K to 12 law allows HEI faculty to teach in the SHS program even if they have not passed the Licensure Examination for Teachers, she said.

Manasan said if the DepEd does not adopt these recommendations, it needs the additional funds to build another 27,000 classrooms in 2016 to 2017, and 23,812 for 2017 to 2018.

This is despite having around 10,000 classrooms in private junior high schools to be available for the SHS program in SY 2016-2017. Despite this, the K to 12 Program will still cause a shortfall of 9,000 classrooms.

The study also stated the DepEd has to hire close to 46,000 new teachers in 2016 and some 38,700 more for the SHS program in SY 2017 to 2018.

In SY 2017-2018, these numbers would have increased to 1.5 million places in public and private HEIs, equivalent to 37,433 classrooms, the study stated.

Manasan said, however, the DepEd can get some reprieve in terms of spending at least for additional classrooms. She said public and private HEIs can provide 21,600 classrooms in SY 2016 to 2017 for use of the SHS program.

If all the available places in HEIs were made available to the SHS program, the total classroom requirement for the SHS program in public schools would drop by 57 percent to 11,572 in SY 2016-2017 from 26,955 with pure DepEd provision.

Manasan said if only 50 percent of the available places in HEIs are made available for the SHS program in the public sector, then the total classroom requirement in public SHS would drop by 35 percent to 17,454 in SY 2016 to 2017.//


Author: Mikhail Franz E. Flores
Date: March 08, 2015
Source: Business Mirror

THE PHILIPPINE government should take key measures to ensure equal opportunities for women and enable them to compete in a global environment, a state think tank said in a policy note.

The Philippine Institute for Development Studies (PIDS), in a policy note titled Promoting womens participation in the APEC economies: some recommendations prepared by Lucita Lazo, suggested three steps to promote womens participation.

Recommendations include empowering women entrepreneurs and preparing them for greater trade liberalization, making women-owned enterprises competitive and building business resilience and sustainability.

At the local level, PIDS said women participation should go beyond social development and should include areas like finance, energy, infrastructures and related fields.

If policymakers see the link between gender and national productivity and wealth creation, the case for gender will become a more attractive proposition, PIDS said.

To empower women, PIDS said access barriers in resources for women should be broken and women micro entrepreneurs in the informal economy should be more organized.

Women entrepreneurs outlook on free trade should likewise be globalized, PIDS said.

They should be made aware of the rapid changes in the regional and global business environments and understand the importance of knowing and complying with regional and global standards of quality, productivity and efficiency, PIDS noted.

To enhance womens competitiveness, trainings for micro entrepreneurs like manufacturing practices and starting a business should be continued, PIDS said.

To ensure sustainability and awareness, local government should assist small businesses in coping with adverse events like a calamity or a financial crisis. --


Author: Mikhail Franz E. Flores
Date: March 08, 2015
Source: BusinessWorld

The International Energy Agency (IEA) has urged Southeast Asian countries to increase the share of natural gas as power supply with the projected surge of electricity demand in the Asean region.
IEA global energy policy office Asia Pacific and Latin America division head Misako Takahasi, during the Natural Gas Summit 2015 at the Intercontinental Hotel in Makati City running from March 5 to 6, said power demand in Southeast Asia is expected to surge by 80 percent in 2035.
The engine of demand growth moves to Asia. Asean energy demand increases by over four-fifth in the period of 2035, or by more than the current energy consumption of Japan, she said.
But Takahashi noted that the 80-percent increase is still a normal rate given the projected growth of Southeast Asian economy supported by the Asean Economic Community (AEC) taking place by end-2015.
The population growth and the number of population without access to power will also drive the increase in demand in the incoming years.
This rate is not surprising given the large population and economic growth of Southeast Asia, the IEA official said.
In the region, only Singapore and Brunei Darussalam have 100 percent of its population have access to electricity, according to a study of Philippine Institute for Development Studies.
In the Philippines, 16 million of the population has no access to electricity. Even higher for Indonesia at 63 million individuals with no access to power; Myanmar with 26 million; Cambodia with 10 million; Thailand with 8.0 million; Laos with 2.2 million; Vietnam with 2.0 million; and Malaysia with 200,000 of its population
The challenge for the region is whether its prepared or not for this demand, Takahashi noted.
She urged that power supply in the region must evolve from coal to natural gas as coal-fired power plants have contributed a lot to climate change which will cause detriments to economic prospects.
But the IEA projected that coal will remain the main source of power in Southeast Asia in the incoming years, followed by renewable, gas, and nuclear energy.
Takahashi, however, noted that volume of liquefied natural gas will double by 2035.
Takahashi also said the IEA supports the Trans Asean Gas Pipeline (TAGP) Project which envisioned to establish interconnecting arrangements of electricity and natural gas among the ten member-states of Asean to ensure greater security and sustainability of energy supply in the region.
According to Asean Council on Petroleum (ASCOPE), the TAGP Project"led by Malaysias PETRONAS"has already established 11 bilateral connections with a total of 3,020 kilometers of pipeline connections making possible the transmission of gas among ASCOPE member countries.//PNA


Author:
Date: March 07, 2015
Source: Manila Times

The so-called inclusive growth which is the lynchpin of President Aquinos economic policy or what the administration calls Aquinomics has been shown as a complete myth based on government figures that showed the poverty level worsening to 25.8 percent in the first half of 2014 from 24.6 percent a year ago.

Poverty worsened despite the 6.1 percent economic growth last year that was said to be the second fastest in Asia after China.
The 2013 figure was frequently used by President Aquino to The claim that poverty incidence improved during his term by comparing this with the 27.9 level in 2012, although the figures were arrived at using different formula that tended to embellish the figure.
The 2013 data used the Annual Poverty Indicators Survey (APIS) formula compared with the 2012 Family Income and Expenditure Survey (FIES).
The 2014 data also used the APIS formula.
Economists said that the poverty levels using the two different formulas are not exactly comparable.
The 25.8 percent poverty level means 26 out of 100 Filipinos are poor and puts the Philippines having the highest poverty incidence among the six biggest Association of Southeast Asian Nations (Asean) members (Indonesia, Malaysia, Philippines, Singapore, Thailand, and Vietnam).

The Philippines poverty record would be comparable to our poorest Asean neighbors Laos (27.6 percent, 2008) and Myanmar (26.5 percent, 2008) and Myanmar (26.5 percent, 2009) rather than our richer counterparts. Even Cambodia, a poor emerging country, has a lower poverty incidence (20.5 percent, 2011) than the Philippines.
The Philippine Statistics Authority (PSA) said in the first semester of 2014, a family of five needed at least P6,125 on the average every month to meet the familys basic food needs and at least P8,778 on the average every month to meet basic needs aside from food.

Both indicate increases of about 9.5 percent in food threshold and 9.4 percent in poverty threshold between 2013 and 2014, according to PSA.

The National Economic and Development Authority (NEDA) blamed the rise in the poverty incidence to government restrictions on rice imports and the lingering effects of a typhoon Yolanda, which happened almost two years ago.

Socio-economic Planning Secretary Arsenio Balisacan said the higher food prices, particularly of the staple rice, and effects of Yolanda that devastated the central Philippines wiped out gains in per capita income.

Baliscan said the increase in poverty could have been avoided by better management of food supplies nationally, particularly rice which accounts for 20 percent of the budget of low income families.

Just at the time when the world price of rice was declining, the domestic price of rice was skyrocketing, Balisacan said.
Rice prices rose 11.9 percent in the first half of 2014 as supplies tightened due to lean harvests and lower imports.
Balisacan said data in 2014 showed the governments income redistribution program and policies to attract investment benefited the poor, but the higher inflation eroded incomes.

Even the state-owned think tank Philippine Institute for Development Studies (PIDS) in a study branded as inaccurate Aquinos claim that the poverty level in the country was on a downtrend using different formulas in arriving at the 2013 and 2012 figures.
Aquino has often used the poverty estimate to prove the economic conditions of Filipinos are improving and even attributed the reduction in poverty to the impact of the governments version of the conditional cash transfer program, Pantawid Pamilyang Pilipino Program.

Even the World Bank, in its August 2014 issue of the Philippine Economic Update, similarly described improving poverty conditions using the data.

In a policy note that PIDS released, its authors argued that while these descriptions of poverty are based on official statistics, the April 2014 press release of the PSA did not actually report a drop in poverty incidence from 2012 to 2013.
PSA mentioned that 24.9 percent of Filipinos were poor in the first semester of 2013, and that in the same period in 2012, poverty incidence among Filipinos based on the 2012 Family Income and Expenditure Survey (FIES), was recorded at 27.9 percent, PIDS Senior Research Fellow Jose Ramon Albert and co-author Arturo Martinez in Is poverty really decreasing? And if not, Why not?

But isnt 24.9 percent a decline from 27.9 percent?

Seemingly, yes, but in this case, no. To compare statistics, their methodologies should be equivalent, Albert explained.
The PSAs technical notes stated that the source of poverty data on the first half of 2013 is the 2013 APIS, a nationwide sample survey designed to provide information on the different indicators related to poverty and uses a different questionnaire from that of the 2012 FIES.

Former Budget Secretary Benjamin Diokno raised the same argument to disprove the Aquinos claim of poverty reduction under his term.

In a Labor Day speech last year, Aquino said the poverty incidence had improved by three percentage points which he claimed to have been the result of his policies using the tuwid na daan dictum.

The figures were compared with the 27.9 poverty incidence based on the 2012 FIES.

The two numbers are not exactly comparable, according to Diokno.

He said the APIS was based on a smaller sample (10,864 respondents) and shorter questionnaire (32 pages, 6 pages on expenditure and 19 pages on income) while the FIES has a sample size of 42,618 and a lengthier questionnaire (78 pages, 47 pages for expenditure and 24 pages on income).

Diokno said since the APIS results are based on a small sample, it does not give the overall poverty picture for the entire country.

It cannot be used to analyze regional and provincial poverty incidence. The FIES results, on the other hand, allows a more detailed poverty picture, down to the provincial level, and hence allows more focused and pinpointed policy intervention, he added.

He added the poverty threshold used in the APIS study appears unreasonably low.
Balisacan noted that per capita income in the first semester of 2014 was higher by 6.4 percent than in 2013.
Among the bottom 30 percent of income-earners, per capita income increased by about 7.3 percent in the same period in the previous year.//


Author:
Date: March 07, 2015
Source: The Daily Tribune

State think tank Philippine Institute for Development Studies (PIDS) underscored the need for the government and the private sector to empower women and woman-entrepreneurs in the country.

PIDS consultant Lucita Lazo, in a policy note released in time for the observance of Womens Month this month, stressed that the economic contributions of Filipino women are not being harnessed to the fullest because of cultural and economic setbacks.
The rate of women who leave the country seeking better jobs for their family offsets the notion that the Philippines is a progressively equal opportunities country. Women often take on the lowest paying jobs with the lowest security, not just in terms of employment continuity but also in terms of health and well-being, she said.

Lazos observation summarizes two policy notes on woman-entrepreneurs as outputs of the Asia Pacific Economic Conference 2015 Research Project commissioned by the Department of Foreign Affairs, which explored the different obstacles woman-entrepreneurs face in the Philippines.

The policy notes outline challenges and opportunities for policy-makers to boost woman- entrepreneurs especially against the backdrop of the Asean integration and freer trade.

Lazo shared experts opinion that even as Filipino women outperform Filipino men, translating their capabilities into business leadership opportunities remains a work in progress.

There are more educated Filipino women, yet mens employment still exceeds womens significantly. The Philippines boasts of having the highest ratio of female-to-male business leaders, yet experts believe that opportunities for women continue to be held back by oppressive conditions, and most of all, by persistent economic inequality, she said.

In her policy note titled Challenges in the Economic Participation of Women as Entrepreneurs, Lazo warned that the sustainability of the positive recognition of Filipino woman-entrepreneurs is hindered by several factors.

These include access to resources, sustainability of their businesses, lack of a business discipline, preparation and readiness for changing economic outlooks, lack of woman representatives on decision-making levels, lack of access to health and socio-legal protection; and a simple lack of information for a nuanced understanding on the part of leaders and policy-makers.

She said that women are most vulnerable to cultural and economic hindrances that often force them to choose their families over their businesses.

Their independent access to finance is restricted without their husbands consent, as indicated by the Family Code. More women register businesses, according to the DTI [Department of Trade and Industry] citation, but more men renew licenses. Womens decision are affected the most by health risks, economic instabilities and catastrophes, making them altogether less able to sustain their businesses, she said.

This, she added, may also be because of the lack of organization and representation of woman-entrepreneurs in the government.
In another policy note, titled Promoting Womens Participation in the Apec Economies: Some Recommendations, Lazo said: Where agency heads perceive gender as inconsequential or unrelated to their respective agency mandates, the talk of gender will not walk far enough to reach the frontlines where it matters.

She said that policy-makers should see the link between gender and national productivity and wealth creation. Lazo identified three goals for policy-making at the national level: empowerment, enhancing competitiveness, and ensuring sustainability and resilience.

She underscored the need to eliminate barriers to accessing resources, promote skills, protection, and other opportunities that allow women to build up the readiness, sustainability, and competitiveness of their businesses.

Lazo said that local leaders play an important role in empowering woman-entrepreneurs, as well.

Getting woman-entrepreneurs organized is essential, not only to help them share the wisdom and knowledge of doing business with other women in their category, but also making it easier to inform each other of the opportunities and challenges affecting them, she said.

Specifically, Lazo recommends incentivizing business registration with access to the supply chain of government procurement programs.

National policy-makers, she added, have to create social-safety nets, such as improving access to credit and healthcare, to encourage women to sustain their business ventures and withstand threats of instability and catastrophes.//


Author: Jonathan L. Mayuga
Date: March 07, 2015
Source: Business Mirror

The Philippines should consider the removal of the quantitative restriction (QR) on rice to bring down the price of the staple, the National Economic and Development Authority (Neda) said on Friday.
Economic Planning Secretary Arsenio M. Balisacan said making rice cheaper would help temper inflation, which picked up in the first half of 2014 due to higher food prices. The increase in food prices was cited by the government as a significant factor behind the rise in the countrys poverty incidence.
While we definitely need to support the agriculture sector in general, we should also maximize the gains from trade and globalization, said Balisacan, who is also director general of the Neda.
The private sector should be allowed to take the drivers seat, while government simply facilitates the access to both the import and export markets, he added.
The Neda said rice prices grew by nearly 12 percent in the first semester of 2014 from 1.7 percent in the same period in 2013 due to tight supply caused by lower harvests and less imports.
At a time when the world price of rice was declining, the domestic price of rice was skyrocketing, Balisacan said.
Neda noted that rice is a staple food for low-income and vulnerable families, usually accounting for 20 percent of their budget.
Higher food prices resulted in a huge increase in poverty thresholds, said Balisacan.
The Philippines was allowed by the World Trade Organization to extend the QR on rice until 2017. The QR enabled Manila to limit the entry of cheap-rice imports into the country.
The government said it sought the extension of the QR to protect rice farmers.
The tariffication of the countrys rice QR has also been recommended by state-owned think tank Philippine Institute for Development Studies (Pids). The removal of the QR, the Pids said, will increase rice imports tenfold, but bring down rice prices significantly.
Aside from revisiting the QR policy, Balisacan also stressed the need to update the governments budget for poverty-reduction programs.
The governments social- development programs, particularly the Conditional Cash Transfer, provided through the Pantawid Pamilyang Pilipino program, may have provided additional support to temper the rise in poverty, but could have contributed more toward reducing poverty had the value of the grants increased with inflation, he said.
It is also important to ensure the timely disbursement of the budget to maximize the impact of programs and projects, Balisacan added.//


Author: Cai Ordinario
Date: March 06, 2015
Source: Business Mirror

UPDATED) The youth commission says the Commission on Higher Education should put in place protection mechanisms for students who are denied school services because of unpaid school fees
MANILA, Philippines (UPDATED) " The Commission on Higher Education (CHED) is looking into the suicide of Cagayan State University (CSU) student Rosanna Sanfuego.

Rappler learned on Wednesday, March 4, that Commissioner Alex Brillantes Jr, CHED chair designate of CSU, has been tasked to look into what really happened.

According to police, 16-year-old Sanfuego hanged herself at home in Abulug town in Cagayan. Hours before her body was found on February 25, she texted her brother about her problems: she was not able to pay her school fees, so she didn't take the midterm examinations.

Authorities say depression may have been the probable cause of the suicide.

The incident comes just as the university is studying the reimposition of tuition feesafter observing a "no tuition fee policy" since 2009. But even without a tuition fee, the cost of school fees still range from P2,000 ($45.37)* to P4,000 ($90.74). (READ:'Students cant afford reimposition of CSU tuition fees')

In a separate statement, CHED said CSU has already extended "financial, spiritual, and moral support" to Sanfuego's family. The incident will be taken up as a priority agenda at the CSU board meeting on Friday, March 6.
NYC to CHED: Be more proactive

The National Youth Commission (NYC) on Wednesday slammed CHED for not having in place systems for violations of guidelines on increase in tuition and other school fees.

Youth groups estimated 400 colleges and universities may raise their tuition fees for academic year 2015-2016, but CHED said this is "highly improbable."

"Filipino students need an institution that truly regulates unbridled school fees," NYC Chairperson Gio Tingson said in a statement.

The governments chief policy-making arm for youth concerns also lamented there is no clear mechanism on how students can oppose any increase, and protection when students are denied school services because of unpaid school fees.

For now, Tingson said, students can report violations of student rights towww.strawdesk.com.

NYC will coordinate with CSU to resolve the issue, and with Sanfuegos family to extend assistance. As it begins dialogue on tuition fee guidelines, NYC said Sanfuegos death is a wake-up call to CHED.

"We urge CHED to work more proactively in pushing for the welfare of the students. We need their institution to realize that unbridled tuition and miscellaneous fees destroy the bright future of young Filipinos," Tingson said.

Since 2014, CHED has been developing with the Philippine Institute for Development Studies a framework that can help the commission decide on a reasonable, annual tuition increase rate. " Rappler.com
*US$1 = P44.08


Author: Jee Y. Geronimo
Date: March 04, 2015
Source: Rappler.com

NO SAFE WATER and toilets in homes mostly not powered by electricity. Far fewer doctors and health facilities care for their babies and mothers. They die up to 10 years earlier than most Filipinos across the nation.
Yet still, the people of the Autonomous Region in Muslim Mindanao (ARMM) have had to flee their homes incessantly on account of intermittent clashes between soldiers and armed groups.

ARMM, home to 3,256,140 Filipinos as of the 2010 census, is a stodgy record of ill-starred stats.
As of 2011, of the 455 waterless municipalities in the country, 94 are in the five provinces of ARMM, according to the Philippine Institute for Development Studies repot titled Water Financing Programs in the Philippines: Are We Making Progress?

These 94 waterless towns of ARMM come from the regions five provinces " 36 in Lanao del Sur, 20 in Maguindanao, 16 in Sulu, 11 in Tawi-Tawi, and 11 in Basilan.

More detailed official data as of 2003 showed that 8 of 10 people in Tawi-Tawi, 7 of 10 in Basilan and Sulu, five of 10 in Maguindanao and 4 of 10 in Lanao del Sur did not have access to improved water sources.
The number of households with access to safe water supply as of 2007 revealed that of Marawi Citys 26,009 households, only 5,064 have access to safe water supply (19%), and only 13,400 or half the households have sanitary toilets.

Electricity also remains a scarce public good in ARMM. While 40 percent of Lanao del Surs population had power as of 2007, people located elsewhere in ARMM continue to linger in the dark, literally. Up to 63 percent of the people in Basilan; 76 percent in Maguindanao; and 83 percent in both Sulu and Tawi-Tawi, hade no electricity as of that year.

By another index, the number of rural health units or RHUs in the nation as of 2011, ARMM fares just as poorly. Of the 2,314 RHUs in the Philippines, only 119 are in ARMM " 42 in Lanao del Sur, 33 in Maguindanao, 19 in Sulu, 13 in Basilan, and 12 in Tawi-Tawi, according to the Department of Health.

The number of district and provincial hospitals in ARMM presents a picture just as lean and bad " the Philippines has 584 district hospitals and 89 provincial hospitals. However, the slice of the pie that goes to ARMM is a pithy 24 district hospitals and two provincial hospitals, or one each in Sulu and Tawi-Tawi. None exists as yet for the provinces of Maguindanao, Basilan, and Lanao del Sur.

In terms of the latest infant mortality rate data, the National Statistical Coordination Board reported that in the Philippines, an average 23 babies per 100,000 population die each year before reaching age 5 as of 2006. The figure for ARMM was much more at 33.

The proportion of children under a year old who had been immunized against measles stood at 81 percent across the nation in 2003. The ARMM figure is much lower at 76.9.

When mothers give birth, attendance and care by skilled health personnel would be most safe and ideal, In the Philippines as of 2006, seven in 10 or 70.1 percent of mothers giving birth got this service as of 2006. In ARMM, only 49.1 percent or less than five in 10 got the service.

But the sorriest number of all pertains to the life expectancy of men and women in ARMM. As of the latest 2000 data, across the nation, Filipino males live up to 66.11 years, and Filipino females, up to 71.64 years, according to the Philippine Statistical Authority.

In ARMM, Filipinos die five to 10 years younger, however. Life expectancy among males in the ARMM provinces is much, much shorter. In Maguindanao, life expectancy is at 60.3 years for males, and 61.65 for females; in Sulu, 56.97 and 58.53; in Tawi-Tawi, 56.13 and 57.5; in Lanao del Sur, 61.87 and 62.74; and in Basilan, 61.and 67.43.
As of the 2010 census, the National Statistics Office said ARMMs 3.25-million population consists of 293,322 people in Basilan, 933,260 in Lanao del Sur, 944,718 in Maguindanao, 718,290 in Sulu, and 366,550 in Tawi-Tawi.// " With research and reporting by Fernando Cabigao Jr. and Jaileen F. Jimeno, PCIJ, March 2015


Author: Cabigao, Fernando Jr. and Jaileen F. Jimeno
Date: March 02, 2015
Source: Philippine Center for Investigative Journalism

MANILA, Philippines - Valenzuela City Rep. Sherwin Gatchalian called for the creation of an audit body attached to the Commission on Higher Education (CHED) that will monitor the increase in the salaries of teaching and non-teaching staff, and the improvement of school facilities bankrolled by tuition hikes as provided under CHED Memorandum Order No. 3, series of 2012.
Gatchalian, a member of the House committee on higher and technical education, proposed that auditing bodies could be formed under CHEDs regional offices.
According to the memorandum, 70 percent of the proceeds shall be used to increase salaries, wages, allowances and other benefits of its teaching and non-teaching personnel and other staff, except administrators who are principal stockholders of the HEI (higher educational institutions).
At least 20 percent, meanwhile, shall be used for the improvement or modernization of buildings, equipment, libraries, laboratories, gymnasia and other similar facilities and operation costs.
HEIs only have to submit to CHED a certificate of intended compliance and a certificate of compliance, both certified under oath by the school head to show where the proceeds of school fees hike are going.
Other documents to be given to CHED on or before April 1 are the list of student council officers, certification on the conduct and results of consultation, comparative schedule of tuition and other fees for the current academic year and proposed increases and a letter of advice by the school head informing the agency of the planned tuition hike.
The provisions apply to private HEIs.
Gatchalian said private schools have been increasing their tuition and other fees almost every year and yet there is no mechanism by which CHED can verify if private school owners strictly complied with allocating the proceeds to salary increases and facility improvement.
By assigning auditing teams to monitor how the proceeds of the tuition fee hike was spent, we are actually teaching private higher educational institutions to justify their need to ask parents and students to shell out more for their school fees, and for parents to be more vigilant against tuition fee increases, Gatchalian said.
He said he is set to file a bill that will further amend the Education Act of 1994 to disallow educational institutions that do not comply with the proportion of proceeds from increasing their fees for the next three years.
Based on data from its tuition monitor network, the NUSP revealed that some schools have expressed their intention to raise tuition by up to 13 percent, while other school fees can increase by 20 percent.
CHED reported that in academic year 2014-2015, only 287 private higher education institutions were permitted to increase fees, lower than the 354 private HEIs in the previous year. CHED had said it will provide realistic estimates by April since deadline of intended hikes in tuition and/or other school fees submissions is on April 1.
Reports said CHED is now working with the Philippine Institute for Development Studies (PIDS) to create a systematic database and broadly acceptable framework for tuition and other school fees that will serve as guidelines to the agency in deciding the reasonable rate of increase per year.//

Author: Paolo Romero
Date: March 02, 2015
Source: Philippine Star

Even the state-owned think tank Philippine Institute for Development Studies (PIDS) branded as inaccurate President Aquinos claim that the poverty level in the country is on a downtrend as it noted the change in the formula used for determining the data.
In a study, PIDS noted that the Philippine Statistics Authority (PSA), in its official estimated poverty figures for the first half of 2013, reported 24.9 percent of Filipinos were poor in the first semester of 2013 based on the 2013 Annual Poverty Indicator Survey (APIS).
Aquino had often used the poverty estimate to prove the economic conditions of Filipinos are improving and even attributed the reduction in poverty to the impact of the governments version of the conditional cash transfer program, Pantawid Pamilyang Pilipino Program.
Even the World Bank, in its August 2014 issue of the Philippine Economic Update, similarly described improving poverty conditions using the data.
In a policy note that PIDS

released, its authors argued that while these descriptions of poverty are based on official statistics, the April 2014 press release of the PSA did not actually report a drop in poverty incidence from 2012 to 2013.
PSA mentioned that 24.9 percent of Filipinos were poor in the first semester of 2013, and that in the same period in 2012, poverty incidence among Filipinos based on the 2012 Family Income and Expenditure Survey (FIES), was recorded at 27.9 percent, PIDS Senior Research Fellow Jose Ramon Albert and co-author Arturo Martinez in Is poverty really decreasing? And if not, Why not?
But isnt 24.9 percent a decline from 27.9 percent?
Seemingly, yes, but in this case, no. To compare statistics, their methodologies should be equivalent, Albert explained.
The PSAs technical notes stated that the source of poverty data on the first half of 2013 is the 2013 Annual Poverty Indicator Survey (APIS), a nationwide sample survey designed to provide information on the different indicators related to poverty and uses a different questionnaire from that of the 2012 FIES.
Former budget secretary Benjamin Diokno raised the same argument to disprove the Aquinos claim of poverty reduction under his term.
In a Labor Day speech last year, Aquino said the poverty incidence has improved by three percentage points which he claimed to have been the result of his policies using the tuwid na daan dictum.
The figures were compared with the 27.9 poverty incidence based on the 2012 FIES.
The two numbers are not exactly comparable, according to Diokno.
He said the APIS was based on a smaller sample (10,864 respondents) and shorter questionnaire (32 pages, 6 pages on expenditure and 19 pages on income) while the FIES has a sample size of 42,618 and a lengthier questionnaire (78 pages, 47 pages for expenditure and 24 pages on income).
Diokno said since the APIS results are based on a small sample, it does not give the overall poverty picture for the entire country.
It cannot be used to analyze regional and provincial poverty incidence. The FIES results, on the other hand, allows a more detailed poverty picture, down to the provincial level, and hence allows more focused and pinpointed policy intervention, he added.
He added the poverty threshold used in the APIS study appears unreasonably low.
Based on the state statistics office, in the first semester of 2013, a family of five needed at least P5,590 on the average every month to meet the familys basic food needs and at least P8,022 on the average every month to meet both basic food and non-food needs.
These amounts represent the monthly food threshold and monthly poverty threshold, respectively. They indicate increases of about 2.4 percent in food threshold and 2.6 percent in poverty threshold from the first semester of 2012 to the first semester of 2013, he said
The PIDS study explained that although the 2013 APIS used more questions on income (than it used to) with its 19-page questionnaire, the 2012 FIES income module used 24 pages of questions. And even if APIS 2013 made use of the 24-page income module of FIES 2012, this would still not make poverty data from the APIS and FIES comparable since FIES also asks households detailed information on their expenditures before income questions are asked using a total of 78 pages of questions.
The FIES interview could take an average interview time of five hours.
The APIS 2013 questionnaire had six pages of questions on expenditure, aside from 19 pages of income questions, and several pages of other questions, which, overall, took three hours to accomplish.
We therefore do not have clear evidence to suggest a reduction in poverty from the first half of 2012 to the first semester of 2013. To get definitive recent trends on income poverty, we have to await the results of the 2014 APIS, the PIDS study said.
Historically, however, poverty rates have been unchanged. Based on the latest available figures from FIES, the researchers observed three clear trends on poverty conditions.
First, poverty rates have been unchanged in the first semester periods from 2006 to 2012, since minute differences in estimates are within margins of error. Secondly, poverty rates also have been unchanged in the full year periods from 2006 to 2012, and thirdly, estimates of the proportion of Filipinos who are poor are lower in the full year, compared with first-semester figures, on account of extra income received from thirteenth month wages and bonuses, and other income received in the second semester.
Since poverty rates are unchanged, the number of poor Filipinos is increasing on account of population growth, the researchers noted.
Furthermore, they pointed out a barely changing income inequality, a pattern that could mean that the new opportunities created by economic growth do not allow the income of the poor to catch up with the rest.
They also pointed out that although poor Filipinos were more likely to experience higher income growth, some nonpoor also have been vulnerable to slide into poverty.
Thus, they noted that the government should not only be concerned with the poor, but also with the nonpoor who are plagued by economic risks, in designing the countrys social protection infrastructure.
Policymakers should need to develop policies for risk management such as adequate social insurance and social protection coverage. It is also important to monitor and evaluate the effectiveness of these programs because if left unaddressed, income shocks may hamper the thrust for inclusive growth and for sustained prospects of the countrys development, the PIDS study said.
Even if the figures Aquino used is accurate, a poverty level of 24.9 percent means 25 out of 100 Filipinos are poor which puts the Philippines the only country among the six biggest Association of Southeast Asian Nations (Asean) members (Indonesia, Malaysia, Philippines, Singapore, Thailand, and Vietnam) having the highest poverty incidence, Diokno said.//

Author:
Date: March 01, 2015
Source: The Daily Tribune

MANILA, Philippines - Exporters are opposing calls to implement wage hikes, arguing such would hinder job creation and economic growth.
The Philippine Exporters Confederation Inc. (Philexport), citing the letter of its president Sergio Ortiz-Luis Jr. to Regional Tripartite Wages and Productivity Board chairman Alex Avila, said that another round of wage increase would undermine the viability particularly of small and medium enterprises (SMEs).
Ortiz-Luis said SMEs play a vital role in job generation and livelihood opportunities.
The Trade Union Congress of the Philippines has sought a P136 increase in the daily minimum wage of workers in the National Capital Region (NCR) and the P734 minimum wage hike proposed by the Association of Minimum Wage Earners and Advocates to be implemented in equal tranches of P146.80 over a period of five years.
The wage hike petitions were filed citing inflationary factors, the recent increases in the fares of the Metro Rail Transit and Light Rail Transit, and impending water and electricity rate increases.
We at Philexport remain consistent in our position against barriers to trade competitiveness, especially against our SMEs which will be directly and adversely affected by such increases. We find these petitions ill-timed and irrelevant, Ortiz-Luis said.
He cited a Philippine Institute for Development Studies report which showed that minimum wages are the biggest binding constraints to job creation and economic growth.
Thus, this will again provide a blow on our twin problems of unemployment and poverty, he said.
A wage increase, he added, would also jack up inflation, as manufacturers and service providers would pass on extra costs that could no longer be absorbed by consumers or the workers and other suppliers.
At present, the labor wage in NCR is one of the highest in Southeast Asia.
This clearly makes NCR one of the most expensive regions to do business with, Ortiz-Luis said.
Further, the Philexport concurred with the position of the Employers Confederation of the Philippines that the P734 increase payable in equal tranches over a period of five years has absolutely no basis in law and does not conform to the prescribed standards and criteria for wage fixing.//


Author: Louella D. Desiderio
Date: March 01, 2015
Source: Philippine Star