P-Noy’s De Lima Dilemma

July 10, 2012

PerryScope

By Perry Diaz

In a dramatic entry into the Chief Justice selection derby, Secretary of Justice Leila de Lima claimed that she’s a strong candidate for the Supreme Court’s much-coveted top position.  Claiming experience and independence, De Lima sought guidance from the Lady of Manaoag, who she believes gave Her blessings.

De Lima said that she struggled whether or not to accept the nomination to the highest post in the Judiciary, even claiming that the job was not to her liking because it wouldn’t fit her persona.  No way would she take a job that would demand that she abandon her “love affair” with the media.  No way would she keep her mouth shut in telling her audience — the whole world — of what’s in her mind. Uh, uh, no way, Jose, that’s not the Leila De Lima you know. Never was and never will be.

But in the end, just like the ousted Chief Justice before her, it is a lawyer’s dream to reach the pinnacle of judicial power that finally made her seize the once-in-a-lifetime opportunity to be Chief Justice for the next 18 years, which nobody had ever achieved before.

But don’t get me wrong, I am not saying that De Lima should never be appointed to the Supreme Court (SC).  She’s qualified under the Constitution to sit in the collegial body of 15 legal minds as an Associate Justice, not as the Chief Justice.  For how can someone    who had not written a ponencia — or ruling — lead 14 experienced magistrates.  Yes, that would be like a captain leading 14 generals.

So, why would President Beningo “P-Noy” Aquino III appoint De Lima?

P-Noy’s options

P-Noy has only two options — to appoint or not to appoint De Lima.  It sounds simple and easy.  But a misstep could cause irreparable damage to the judicial system.

His first option is to appoint her.  That’s easy to make, after all De Lima is one of his favorite alter egos, whom many believe would be obedient to P-Noy.  But that’s going to cause public uproar.  She’s perceived to be a “tuta”– lapdog — of P-Noy.

But there is also a perception that P-Noy wants to appoint an outsider to get even with the “Coronarroyo” court that had repeatedly dealt him a bad hand when it ruled against the executive order that created the Truth Commission and several other executive orders.  As a source has said, P-Noy felt that his administration and his own family were, in his own words, “inapi” — harshly treated — by the high court.

His second option is not to appoint her.  If P-Noy had to appoint an outsider it would be De Lima since she’s the closest outsider to him among the 15  outsiders vying for the position.  Appointing her would exact revenge on the “Arroyo justices.”  But with the ouster of Renato Corona as Chief Justice, P-Noy might no longer feel the need to appoint an outsider.  And with Bureau of Internal Revenue Commissioner Kim Henares — another favorite of P-Noy — no longer in contention after she declined her nomination, De Lima remains the top outsider nominee for the job.

Defiance

But recently, presidential spokesman Edwin Lacierda reiterated that P-Noy prefers De Lima to stay at the Department of Justice.  So it came as a surprise that after consulting with P-Noy last June 29 and going on a pilgrimage to the miraculous Our Lady of Manaoag in Pangasinan last July 1, De Lima decided to accept the nomination to the high court.  Did P-Noy encourage her to accept it?  Lacierda said that P-Noy merely told her that he’d respect her decision if she accepted the nomination.  However, Lacierda had stuck to his line that P-Noy wants De Lima to stay as DOJ secretary.  If so, then De Lima appears to have defied P-Noy’s wish.

If that were the case, then it would seem to indicate that she is prone to defy anyone who would stand on her way in pursuit her agenda.  Her defiance of the Supreme Court’s Temporary Restraining Oder (TRO) on the DOJ’s ban for the Arroyos to travel outside the country demonstrates what some people perceive De Lima to be: a disaster waiting to happen — or as some people would call it, a “loose cannon.”  If so, would P-Noy still want her to be calling the shots in the court of last resort for the next 18 years?

But it is interesting to note that it was also because of her defiant streak that finally brought Corona before an impeachment court, which resulted in his conviction for betrayal of public trust. Ironically, if De Lima did not defy the TRO, ex-president Gloria Macapagal Arroyo and her husband Mike would have flown out to exile to avoid prosecution.

The question is: If De Lima were appointed Chief Justice, would she defy the will of the majority in cases where she strongly believes in opposite dissenting views?   If so, then a De Lima court would be no different from the “Coronarroyo” court where Corona seemingly had a strong influence over the majority and swayed them his way.

Dilemma

And this is where P-Noy would have a dilemma. On the one hand, if he appointed her, it might create a maelstrom of controversy that could destabilize his administration and hamper his ability to institute reforms and fight corruption.  On the other hand, if P-Noy did not appoint her, he could lose De Lima — or, worse, De Lima stay at DOJ but wouldn’t lift a finger in prosecuting corrupt officials. Either way would cause a detour in P-Noy’s “daang matuwid” (straight path).

But P-Noy might be spared the agony of making a decision in appointing De Lima.  Recently, the Judicial and Bar Council (JBC) announced that it has decided “to keep all nominees with pending disbarment cases until the council makes its final vote on the shortlist to be submitted to the President.”  De Lima has two pending disbarment cases filed by lawyers Agustin Sundiam and Ricardo Rivera.  JBC gave De Lima and all others who are facing disbarment to clear their cases before July 30.

If the Supreme Court fails to rule on De Lima’s disbarment cases by that time, she will be disqualified.  But time is something that De Lima doesn’t have.  First, the Integrated Bar of the Philippines (IBP) will investigate her disbarment cases; and then it will make its recommendations to the Supreme Court, which would then make its final ruling.  The entire process would take at least 30 days, which would be past July 30 by the time the high court issues its ruling… unless De Lima could pull some strings at the SC.  But who among the SC justices would lift a finger to help her?  And does she think that there are eight justices who would rule to dismiss her disbarment cases?

But given the obvious, why is De Lima still clinging to her hope that the Lady of Manaoag would grant her wish?  It would take more than a miracle to become the top magistrate of the land.  The reality is it takes experience.

(PerryDiaz@gmail.com)

'With great power comes huge electricity bill'

COMMONSENSE

By Marichu A. Villanueva

(The Philippine Star)

July 09, 2012  

Before we could see any signs of immediate relief from rising electricity rates, we should brace for more increases in power prices in the next four years. In a public notice issued last week by the Energy Regulatory Commission (ERC), we were alerted about a rate increase petition filed by the National Power Corp. (Napocor).

The state-owned Napocor seeks to collect from consumers rate increases of 19.62 to 22.56 centavos per kilowatt-hour (kWh) for the Universal Charge for Missionary Electrification (UCME) spread over a period from 2012 to 2016.

Specifically, Napocor asked the ERC to approve UCME of 19.62 centavos per kWh for 2012; 22.62 centavos per kWh for 2013; 32.93 centavos per kWh for 2014; 33.18 centavos per kWh for 2015, and 22.56 centavos per kWh for 2016.

Furthermore, Napocor applied for the UCME subsidy adjustment of 8.51 centavos per kWh recoverable for 12 months that will be collected on top of the existing and proposed UCME subsidy to all consumers. This will allow Napocor to recover the shortfall in the UCME subsidy for 2011.

Specifically, total UCME subsidy requirement for 2011 was at P8.454 billion. The ERC though approved only P2.763 billion for Napocor to pass on its subsidy charges to us end-users of power. In 2010, the ERC reduced UCME level to 4.54 centavos per kWh from 9.78 centavos per kWh.

In its petition, Napocor stated the higher charges would enable it to “continue its present operations in the off-grid areas and prevent the repeat of shortage of fuel and the consequent reduction of operating hours.” In layman’s language, this simply meant we consumers have to pay for investments of government, through Napocor, if we don’t want the recurrence of long hours of rotating blackouts.

“There is an urgent need for the issuance of a provisional authority to ensure sufficient funding for Napocor-Small Power Utilities Group (SPUG) operations and sufficient funding for new power producers’ subsidy,” it added.

The application for higher rates of Napocor falls under the recovery schemes allowed under the Electric Power Industry Reform Act (EPIRA) of 2001 and is supposed to bankroll the government’s electrification services to reach far-flung areas.


The Napocor UCME hike petition is on top of the P10.59 centavos per kWh rate increase petition earlier filed before the ERC by the Power Sector Assets and Liabilities Management Corp.(PSALM), which is among the spin-off companies created out of Napocor.

Napocor earlier estimated P16 billion as the amount they need to collect to continue the construction of new power generation facilities and transmission assets for the next 10 years in far-flung provinces. Napocor was left with the function of operating the SPUG and the remaining power plants left unsold up to now by the state-run PSALM.

According to Napocor, there are 14 areas under SPUG that operate in off-grid areas. These include parts of Catanduanes, Romblon, Siquijor, Sulu, Tawi-Tawi, Basilan and Palawan.

These are the so-called “missionary” areas where no investors dare put up base-load power plant because of small market. So how can private entities recoup their investments over a reasonable period of time if the demand for electricity is low because there are not enough consumers?

This is where the government steps in to provide electricity service to these “missionary” areas. But where would the government source its funds? Of course, the government dips from the budget (taxes) or borrow funds locally or from abroad.

Speaking of Palawan, the local legislative council of Puerto Princesa City declared last Friday a state of emergency all over their chartered city due to acute power supply shortage. Ironically, for the province where the rich Malampaya natural gas comes from, Palawan folks have to live with at most eight hours of electricity service and suffer rotating blackouts everyday.

As if this were not enough, the ERC approved last week the petition of the Manila Electric Co. (Meralco) for increases in its maximum average price (MAP) of P1.6303 per kWh for distribution, supply and metering charges to its different customer classes.

Households consuming 201-300 kWh per month will shoulder a 12-percent increase to P1.5535 per kWh from P1.3851 per kWh, while those with an average consumption of 301-400 kWh will have to bear a 9.8-percent increase to P1.8907 per kWh from P1.7223 per kWh. As approved by the ERC, the higher rates take effect from July 1, 2012 up to June 30, 2013.

Only last March, the ERC approved as much as four centavos per kWh in additional charge for Meralco’s local franchise tax payments.

I have said it before and I’m saying it again, why the hell do we have to pay the value added tax (VAT) on lifeline rate subsidy, cross subsidy charge, and senior citizen subsidy? This is aside from the “missionary” electric service for the so-called marginalized sector of the consumers under the “universal charges” we pay in our Meralco monthly bill.

These subsidies and equivalent VAT charges are passed on to Meralco consumers categorized in the higher level of power usage. We, Meralco consumers in this category, have to pay for these power subsidies and taxes that the government charges us whether we like it or not.

Though grudgingly, we have been shouldering the “take-for-pay” of electricity from the independent power producers (IPPs). But do we have to pay too for the VAT on systems loss of Meralco and the IPPs as charged to our electric bill every month?

When I wrote in my column last week about “Electric shocks,” my nephew tagged me this funny line from 9GAGCOM: “With great power comes huge electricity bill.” Obviously, this was inspired by a popular movie blurb from one of the Spiderman trilogy movies starred in by Hollywood actor Tobey Maguire.

This blurb was actually taken from the dialogue between Peter Parker, a.k.a. Spiderman, and his aunt, telling the reluctant superhero: “With great power comes great responsibility.”

President Benigno “Noynoy” Aquino III will remain in power until he steps down from office in June, 2016. Could we see relief on our power rate burdens any time sooner Mr. President?

Pagcor cuts coffee cost, no charges yet vs suspects

By Maila Ager
INQUIRER.net

PART I

MANILA, Philippines—One of the bombshells dropped by President Benigno Aquino III during his second state of the nation address (SONA) in July 2011 was the P1 billion worth of coffee spent by the previous management of the Philippine Amusement and Gaming Corporation (Pagcor).

Making a quick computation, Aquino told the stunned joint session of Congress: “At P100 per cup, that would be 10 million cups of coffee over the last several years?”

“Where did all that coffee go? Who drank it?” asked the President, wondering if the people behind the coffee scam were “still able to sleep.”

Cristino Naguiat Jr., current chairman of Pagcor, in a statement a day after Aquino’s exposé last year confirmed the coffee tab, which he described as a “scandalous”, “outrageous”, “offensively excessive” misdeed of the previous management.

But a year passed after the nation sniffed the nauseating aroma of the prized drink, no one has yet been brought to court.

When pressed about what Pagcor has done, Naguiat, in an exclusive interview with INQUIRER.net, said that a plunder case, a non-bailable offense, would soon be filed in court against the culprits.

“Yes, I’m definite with that,” Naguiat, a close friend of President Aquino, said over the phone.

He refused to give other details but a statement issued by his office showed Pagcor was preparing a criminal complaint against Promolabels Specialty Shop, which ran a coffee concessionaire in seven casino branches during the term of the gaming firm’s former chairman, Efraim Genuino, an appointee of former president Gloria Macapagal-Arroyo.

Naguiat said he obtained documents showing that from August 2001 to June 2010 the previous management spent P1 billion pesos for coffee, with Promolabels allegedly cornering almost P700 million.

Naguiat also found out that Promolabels, owned by a certain Carlota Cristi Manalo-Tan, was not registered with the Securities and Exchange Commission.

But at the time President Aquino made the exposé, Naguiat admitted that Pagcor had just discovered the procurement of “overpriced coffee” by the previous management.

What was submitted to the President that became the basis of his exposé, Naguiat said in the phone interview, was not an initial report of the agency but “an expense recorded in the book.”

Further investigation by the agency showed,  “There’s solid evidence that they spent P1 billion for coffee.”

Two-in-one

Hurling an accusation is one, but ensuring you have a solid case that can withstand court scrutiny is an entirely different matter. In this case, the process of gathering data has proved to be a grueling task for Pagcor.

“It has taken Pagcor quite a long time to work back on all the documents pertaining to Promolabels transactions because our auditors had to validate and verify every invoice and receipt of Promolabels for the past 10 years,” the government-run gaming agency said.

“So that we can determine the overpricing, we have to look at all receipts. It’s like for every order, there’s one for brewed coffee, for frappe, they are all different, for us to be able to file a case of plunder … you have to look at every receipt,” he said.

“It’s not easy to say, ‘This is the voucher, this is your evidence.’ No. You have to look at all receipts. Do you picture how many those are?”

But to file a plunder case, Naguiat said Pagcor need not have to check all the P1 billion worth  of coffee bills. Plunder is already committed when a public official amasses ill-gotten wealth amounting to P50 million.

“We can no longer file that if we will chase the P1 billion. So we just reached for the threshold. To be safe, I think about P60 million or P70 million of the amount is what they earned,” he said.

Naguiat said he would want to file a case in court backed by solid evidence, and not by mere newspaper clippings.

A cup of prevention

To prevent a repeat, Pagcor said it has instituted various reforms.

First, Pagcor did not ink fresh deals with coffee concessionaires.

“Before, the coffee was given for ‘free’ by the concessionaire to casino customers. But Pagcor in turn had to pay the coffee concessionaire at an average of over P100 per serving,” Pagcor said.

“Moreover, the business given by the previous Pagcor administration to the coffee concessionaire – Promolabels in particular – did not comply with the requirements of government procurement laws.”

“Today, the different Pagcor casinos serve free coffee to all its customers at prices ranging from P9.36 for a cup of brewed coffee to P14.99 for a cup of premium flavored coffee,” it added.

To reduce cost, Naguiat said Pagcor would now buy the local beans, grind them and then serve to casino customers.

As a result, he said, the gaming firm would now spend only about P40 million to P50 million a year for coffee compared to an average of more than P100 million during Genuino’s time.

This anomalous coffee deal is the second plunder case and fifth of the complaints that will be filed since the present management assumed office in 2010.

And Pagcor, Naguiat pointed out, was the only government-owned and controlled corporation (GOCC) that has so far filed this number of cases.

“Tell me if there is a GOCC that has filed four cases during the previous administration. We were the only one. Tell me of a GOCC whose percentage of increase in revenue is high. We’re the only one,” he said.

From coffee to water

But even before the issue on the billion-peso coffee could get cold, Pagcor was again linked to another controversy – this time over the purchase of more than P8 million worth of bottled mineral water without public bidding.

On July 3, 2012, INQUIRER.net reported the findings of the Commission on Audit (COA) which showed that Pagcor spent a total of P8.2-million worth of bottled mineral water and another P1.79 million worth of five-gallon water last year for its three casino branches – Pavillion, Heritage, and Paranaque.

“The procurement of bottled mineral water at the three CF (Casino Filipino) branches  was made through shopping notwithstanding the amount involved exceeded the threshold provided under Section 10 of the Revised Implementing Rules and Regulations of Republic Act No. (RA) 9184,” COA said in its 2011 annual audit.

Section 10 of RA 9184 provides that “All procurement shall be done through competitive bidding, except as provided for in Article XVI, which comprises the various alternative methods of procurement…”

“Our audit disclosed that  the casino branches  purchased bottled mineral water and  five gallon water  thru shopping and  thru canvass from three suppliers, while the total cost for these  items  procured during the year reached more than the threshold for small value procurement of P500,000,” the report  added.

For its branch in Pavillion, COA said Pagcor spent P3,850,127.42  for bottled  mineral water  and  P1,289,779.20 for five-gallon water;  P2,818, 636.80 million and P507,343.68  in Heritage for bottled mineral water and  five-gallon water, respectively;  and  P1,577,779.11  million for bottled mineral water for its  branch in Paranaque.

“We are concerned that the current practice of the Branch may have provided undue advantage and competitiveness in the procurement process,” COA said.

The commission then recommended the gaming firm to justify the chosen mode of procurement for drinking water. At the same time, it told Pagcor to include the procurement of bottled water in its Annual Procurement Plan (APP) and comply with Section 10 of RA 9184.

“If the total amount in the APP is more than the threshold amount of P500,000, procurement should be through competitive bidding,”  it said.

On March 22, 2012, COA said Pagcor’s Procurement and Planning Review Committee met and agreed that “since the procurement of bottled drinking water in the casinos exceeds the threshold of P500,000,  public bidding will be conducted.”

“They have requested all branches to submit a report on their 2011 procurement of bottled water and gallons to determine the total quantity and cost of drinking water being consumed in the branches,” COA said.

But the Commission said the centralized procurement of bottled drinking water by the corporate office should only commence after the new design and labels have been approved. In the meantime the bottled water will be procured in the casinos.

COA said Pagcor promised to ensure compliance with the required public bidding if procurement exceeded the threshold of P500,000.00.

“We did not issue Notice of Disallowance or Notice of Suspension because the audit finding and observations pertains to operational matters which do not involve pecuniary loss as provided under Section 5.3 of COA Circular No. 2009-006,” COA added.

Naguiat breaks silence

Almost a week after INQUIRER.net posted its story, Naguiat broke his silence on the issue.

Naguiat clarified that the price of bottled water was not overpriced as claimed by his critics and reported in some newspapers after the controversy broke out.

No less than COA, he said, informed Pagcor that there was no issue of overpricing.

“It’s because they saw the price and the low cost at which it was bought,” Naguiat pointed out.

“I think the price of each bottled water is a little something over P4. How much is that in 7-11?”

Following COA’s findings, Naguiat accepted the commission’s recommendation to bid the purchase of water if the amount exceeded the P500,000 limit  although he warned that if this will be the procedure, the gaming firm has to find a big warehouse to store the items and at the same time make sure that the beverage would not been served to casino customers beyond their expiration date.

Another option, he said, would be, on top of the bidding, to get the water from the supplier only when stocks run low.

“But the problem there is when you bid it out for one year, their prices won’t move. What if the cost of plastic bottle increases? What if the cost increases, what if the cost of electricity increases?” he said.

“That’s why I told COA that they will be my partner, you’d be the one to protect my BAC [Bids and Awards Committee] because I could not see everything…” Naguiat added.

‘Isolated and ongoing practice’

In its reaction that was posted on the INQUIRER.net, Pagcor said in a statement that the multimillion-peso purchases were “isolated” but an “old practice”.
During the annual audit exit briefing conducted by the COA, Pagcor said the concerned branches explained why they resorted to the “shopping method of procurement.”

Pagcor said the procurement of bottled water, among other consumable supplies, had been previously decentralized to the branches for practicality and expediency due to their different locations.

This means that the branches were authorized to undertake their procurement activities independently of the corporate office.

“Consequently, the procurement requirements at the branch level resulted in smaller quantities which did not breach the threshold amounts provided for under the IRR of RA 9184,” Pagcor said.

“Although admittedly, if the quantities were consolidated Pagcor-wide, the resulting amounts would breach the above-mentioned threshold amounts,” it added.
But Pagcor pointed out that the procurement of bottled water through “shopping” or canvassing of prices “had been the ongoing practice since the last decade.”

Out of 13 casino branches, the gaming firm also noted that only three were mentioned in the COA findings.

“The deviation was therefore isolated. In fact, COA has commended Pagcor’s current management for exercising fiscal responsibility particularly in the area of procurement,” it said.

‘No sanction’
Pagcor was quick to find an ally in Malacañang.

At a press briefing also on July 4, presidential spokesman Edwin Lacierda came to the rescue of Pagcor, saying the gaming firm had stopped the procurement after its attention was called by the COA.

“Pagcor is not in the water business. But it has to provide services to its patrons so these things will have to be ironed out and fixed. So they are now making a mechanism by which we comply with the procurement, at the same time, making sure that the water will be safe—because water has an expiration,” Lacierda said.

This is why Lacierda believes that there is no need to impose sanctions on Pagcor.

“There’s no sanction,” he said.

“Number one, the amount to purchase was less than 500,000 because you cannot buy the bulk. What COA did was to audit the entire amount in an annual basis. All the purchases detailed in retail purchases were less than 500,000.”

Critics’ favorite

With the twin controversies hanging over his head after only two years of being at the helm of Pagcor, Naguiat wonders why he has been the favorite target of critics.

“Why are you so angry with me . . . it’s as if I’m the only one in government. But that’s life. That’s why I’m here so I’ll accept it.”

“Tell me who among those in government have the most number of scandals in the newspaper, just me.”

Even before the scandals on the alleged overpriced coffee and water broke out, Naguiat, a former classmate of Aquino at the Ateneo de Manila University, had been embroiled in a controversy when he was named in a US lawsuit as among Pagcor executives who allegedly accepted $110,000 worth of hotel accommodations in Macau and illegal payments from Japanese businessman Kazuo Okada.

The accommodations and other perks that  he and his family (wife, children and their nanny) and other Pagcor officials allegedly received from Okada was  meant to ensure the implementation of the businessman’s plan to push for a $2-billion casino in Manila.

The Pagcor chief vehemently denied the allegation.

And Malacañang also defended Naguiat’s pricey trip, saying the Macau accommodation was “standard industry practice.”

Death by exaggeration

CTALK

By Cito Beltran (The Philippine Star)

July 09, 2012

When Mark Twain learned about news reports claiming he had died, the American icon replied with the famous line: “The reports of my death are greatly exaggerated”.

In like manner, representatives of the textile and garments industry have recently come together to state for the record that the industry may be struggling but it is far from dead and gone. In fact, many industry players have been spending time together and taking stock of the situation in order to put their house in order and revitalize what was once one of the country’s principal money maker in terms of exports and job generation.

Leaders of the various industry associations representing remnants of the textile millers, garments exporters, garment manufacturers, foreign buyers representatives, the Department of Trade, theDepartment of Labor as well as from the academe have taken bold and basic steps to correct mistakes or oversights in the past.

As their first act, a select group of industry representatives earnestly sought out DTI Secretary Greg Domingo not only to pay a courtesy visit but also to sincerely clear the air concerning disagreements and misunderstandings in the past. What was suppose to be a brief visit turned into a full blown but productive meeting with each side making suggestions, setting goals and initial commitments.

Secretary Domingo stated for the record that the DTI under his leadership was committed to supporting the entire Garments industry from the ethnic weavers, designers, schools, local manufacturers and local retailers, all the way to the exporters. Domingo did stress his vision where Filipinos will not merely be a production unit for foreign companies but would evolve to designing and producing their own brand for the international market. Industry representatives on the other hand shared their plans to revive the industry, promote and produce local brands in cooperation with the DTI.

As a result of reaching out, the industry now has a number of DTI officers assigned to work with the association leaders concerning various programs and concerns. True to his word, Secretary Domingo as well as Undersecretary Panlilio participated in 8 meetings with several US Senators and Congressmen to gain support for a US congressional bill that would give Philippine garment manufacturers special concessions.

With the US – SAVE ACT still up in air in Capitol Hill, leaders of the garments and textiles industry have also begun to engage members of media as well as private sector groups to share their story as well as their plans to revitalize the industry. Over the weekend, they set a record when almost all sectors of the industry participated in the first of two SWOTS session to pin down the true Strengths, Weaknesses, Opportunities, Threats, Solutions of the garments and textile industry. Only by doing so, could the industry members begin to understand and come to terms with how such a successful and profitable industry end up being branded as a “sunset industry” or “Dead and Gone”.

Initial analysis points out that the industry took a lot of hits primarily because the key players were too busy doing business and left government in the past to make decisions on their own. When preferential quotas for exports were removed, government officials decided that the Garments Textile Exports Board (GTEB) which was the primary go to agency for the industry, was no longer necessary and all its remaining functions outside of quotas was spread out to the Bureau of Customs and the DTI.


As a result, the industry’s representation, access, as well as relationship with government rapidly deteriorated and eventually soured. This realization now has industry players back tracking and eager to correct situations as well as policies that have been detrimental to the industry. In their historic workshop, even representatives of DTI-CITEM, DOLE and UST (representing academe) actively participated and gave crucial inputs.

Coming out of their first session, participants established that there are still several local companies exporting quality, high-end garments abroad. Although, the textile sector will need more than a shot in the arm, the group realized the high potential of indigenous fibers such as abaca, which right now is being used by German automakers for the interior and upholstery requirements. Consequently, the textile group will be looking into renewed marketing and promotions as well as incentives for procuring and developing raw materials. In addition, suggestions were made to acquire mothballed equipment to increase local production.

The big news and big potential in the second life of the industry is that many local manufacturers have begun to create their own brand and now produce these lines for the Philippine market which will eventually compete with the “imported” brands such as Mango, Forever 21 and Uniqlo because of the manufacturers long history of producing quality garments for top brands abroad. By tapping young local designers, new brands and styles would be easy to start up and will be in tune with Filipino buyers.

Another piece of good news is the decision by Members of the European Parliament to create new trade preferences “where 3 countries namely Pakistan, The Philippines and Ukraine will be allowed to apply for zero EU duties to be charged on their exports to the EU under the GSP+ incentive scheme. This will certainly be a “major, major” break for the garments and Textile industry IF Malacanang gives it’s full support and push to the Department of Trade and Industry as well as the Department of Foreign Affairs in the next 9 months.

Judging from what the industry leaders have managed to do in less than two months alongside the positive response of the DTI and DOLE, it only takes a leap of faith to believe that the country can qualify for the GSP+ incentive scheme and that is not an exaggeration.

* * *

Email: Utalk2ctalk@gmail.com

Safety meltdown

Philippine Daily Inquirer

Editorial

July 6, 2012

A panel of experts looking into the Fukushima nuclear crisis last year described the disaster as largely manmade and the result of “collusion” between government, regulator and plant operator. The release of the report should douse cold water on the decision of Prime Minister Yoshihiko Noda to end a two-month shutdown of Japan’s nuclear power plants and reactivate them one by one starting this month. The reactivation is taking place amid fierce public outcry that the government may be paying lip service to safety requirements in the rush to reopen the plants and get industries going. As the expert report suggests, the same blasé attitude appears to have caused the 2011 crisis in the first place.

The report somehow squares with the admission of a Japanese Cabinet minister last month that Japan’s nuclear watchdog and the science and technology ministry failed to disclose US data about the spread of radiation spewing from a crippled nuclear plant last year, so that some evacuees fled in the same direction as the radioactive emissions. Like the panel report, the remarks of Industry Minister Yukio Edano indicated collusion between regulators and the operators of the nuclear power plant.

The panel said it could not rule out that the damage on the Fukushima Daiichi plant was caused mainly by the big earthquake on March 11, and not just by the tsunami that ensued after the temblor. The finding could have serious implications as Japan seeks to reactivate idled reactors. Earlier, all of Japan’s 50 functional reactors had been taken offline one by one for maintenance and safety checks. The last reactor was shut down last May amid widespread public concern over the safety of nuclear plants in the event of another large earthquake and tsunami of the sort that struck Fukushima, which resulted in a meltdown that contaminated a large part of northern Japan with radiation, forcing about 150,000 people from their homes, many of whom can never return.

The panel pointed to problems in the response of plant operator Tokyo Electric Power Co. (Tepco) and Prime Minister Naoto Kan, who resigned last year after criticism of his handling of the crisis. “The Fukushima nuclear power plant accident was the result of collusion between the government, the regulators and Tepco, and the lack of governance by said parties,” the panel said.

Moreover, regulators reportedly did not adopt global safety standards. “Across the board, the commission found ignorance and arrogance unforgivable for anyone or any organization that deals with nuclear power. We found a disregard for global trends and a disregard for public safety,” the panel said. “As a result of inadequate oversight, the SA (severe accident) countermeasures implemented in Japan were practically ineffective compared to the countermeasures in place abroad, and actions were significantly delayed as a result.”

The conclusions of the report are serious and even damning. The finding that seismic damage may well have played a role in the March 11 meltdown should  affect not only the restart of reactors that have been temporarily decommissioned, mostly for maintenance and safety checks, but also the future of nuclear power in Japan. Just as serious is the discovery that Tepco, abetted by law regulators, might have cut corners and costs, thus jettisoning considerations of safety.

Although several other investigations are being carried out, the report should at least compel the Noda government to rethink its decision to reactivate the power plants. Over the long term, it should review Japan’s nuclear future. While Tepco’s own internal investigation issued last month denied responsibility for the disaster, saying the big “unforeseen” tsunami was to blame, the denial was at least self-serving. In any case, admitting that the earthquake caused much of the damage should at least oblige Tepco and the Japanese government to think hard whether nuclear power is really the way to go for a resource-scarce but quake-prone country. Even Tepco admitted that in hindsight, it was insufficiently prepared for the twin disasters, whether by omission or commission it didn’t say. But the admission should at least make everyone think twice whether a country, even presumably as safety-obsessed and disaster-ready as Japan, could ever really be prepared. What the findings really show is that March 11 wasn’t only a nuclear meltdown; it was also a safety meltdown.

Gov’t, MILF vow to forge peace pact but timetable hangs

COTABATO CITY -- The peace panels of the government and Moro Islamic Liberation Front (MILF) at the weekend have vowed to maintain proactive negotiations in a bid to reach a final peace deal, but remained split in setting a time frame to end the process.

“The peace agreement should be one that is simple and meaningful and should be signed within the year,” said government chief negotiator Mario Victor F. Leonen on Saturday at the opening of the three-day Bangsamoro Leaders Assembly at the MILF administrative base in Camp Darapanan in Maguindanao province. The event was attended by close to half-a-million people, mostly Moros.



The government peace panel had failed to meet a March deadline for striking a peace agreement citing major issues that need to be addressed first.



MILF peace panel member Abhoud Syed M. Linga, however, told BusinessWorld it is “impractical” to put a time frame for the peace deal.



“It is okay to say that we want to fast-track the peace agreement, but for me, putting a deadline would [be risky].”



For his part, MILF Chairman Al Haj Murad Ebrahim noted that the recent signing of the 10 decision points “sends a flickering light” to the ongoing negotiations, since “it is the only and first concrete achievement as far as the GPH (government of the Philippines)-MILF negotiation” under the Aquino administration is concerned.



Mr. Ebrahim has noted that the group’s four-point program -- Islamization, strengthening of the organization, military buildup, and self reliance -- has made MILF “one of the biggest liberation organizations in the world today.”



“The MILF political committees exist in practically every village,” he said noting the group has organized 43 provincial committees in all parts of Bangsamoro region.



Presidential Adviser on the Peace Process Teresita Q. Deles, who was at the assembly, cited the MILF’s effort in uniting the Bangsamoro people, while noting the government’s sincerity in ending the decades-old Mindanao conflict.



“Sinsero si PNoy, seryoso si PNoy [The President is sincere, the President is serious,” she said, referring to efforts of President Benigno S. C. Aquino III to push the peace agenda.



Consultations have been conducted with various sectors of society on the peace agreement, said Ms. Deles, noting that the Philippine Development Plan (2011-2016) puts a premium on peace and security.



Bai Sandra A. Sema, 1st district representative of Maguindanao in the Regional Legislative Assembly, called on both parties to fast-track the inking of a peace agreement so Congress could enact the necessary legislation to jack the deal.



Datu V. Dustin Mastura, Maguindanao vice-governor, cited local efforts in supporting the peace process, noting that Maguindanao is the only province that passed a resolution in 2010 that declared full support to the peace talks.



In his opening message, Ghazali Jaafar, MILF vice-chairperson for political affairs, said that Bangsamoro self-rule is seen to end the dispute.



Secretary-General Ekmeleddin Ehsanoglu of the Organization of the Islamic Cooperation, in a statement read by his representative, cited previous efforts of the organization in helping solve the Mindanao conflict.



For his part, Moro National Liberation Front (MNLF) Chairman Muslimin G. Sema, in a statement read by his representative, said that the enabling law that supported the 1996 government-MNLF peace agreement was “crafted defectively,” claiming that the government’s reform agenda is “incongruent” with that of the MNLF’s.



Zainudin M. Malang, executive director of the Mindanao Human Rights Action Center, a member organization of the International Monitoring Team (IMT), told BusinessWorld it is important to monitor the people on the ground to ensure that parties would reach the negotiation before the year ends.



The IMT, led by Malaysia which is acting as facilitator in the talks, monitors the implementation of the truce deal with the MILF



The government has been negotiating with the MILF for 15 years now. Last year, the talks between the two parties almost collapsed due to the Oct. 18 incident in Al-Barka, Basilan that left 19 government soldiers dead.



In April, the government and MILF had agreed to create a new autonomous political entity that will replace the current autonomous Muslim region. -- Amilbahar S. Mawallil

China grabs PH atoll

July 6, 2012 

By Jaime R. Pilapil, Llanesca T. Panti and Bernice Camille V. Bauzon
Manila Times

WHILE the government and the public were focused on the territorial dispute at the Panatag (Scarborough) Shoal, China moved to claim territorial rights over a huge group of reefs and shoals in the middle of the West Philippine Sea (South China Sea) that is touted as the largest atoll in the world—Macclesfield Bank.

The Philippines lays claim to Macclesfield Bank (Zhongsha islands) and administers the atoll through the provincial government of Zambales.

Recently, however, the Chinese State Council placed the Bank, along with its claimed islets and reefs in the Kalayaan (Spratly) and Paracel islands, and their surrounding waters as a prefecture of the City of Sansha.

By upgrading the atoll’s status from county level to prefectural-level of administration, China tightened its grip on the contested territory.

State-run news agency Xinhua previously quoted an official of the Chinese Ministry of Civil Affairs who explained that the upgrade would “further strengthen China’s administration and development” of the three major island groups.

The Manila Times sought Malacañang and the Foreign Affairs department for comment but officials kept mum on the issue, probably to avoid further fuelling tension between Manila and Beijing.

Submerged

Covering an area of 6,500 square kilometers (2,500 square miles), Macclesfield Bank is surrounded by excellent fishing waters that can be dangerous for boats due to the submerged reefs.

It is geographically close to other contested island groups—the Paracel Islands, Spratly Islands, Scarborough Shoal and Pratas Islands.

China and Vietnam are at odds over the Paracels and parts of the Spratlys. Last Sunday, the Chinese government sent four patrol boats to the area when Vietnam declared its sovereign rights over the disputed islands.

On the other hand, China and the Philippines are in a tug-of-war over some parts of the Spratlys and Macclesfield Bank, which is located in the center of the West Philippine Sea. It is an almost entirely submarine platform measuring 115km in length with a maximum width of about 60km.

The Macclesfield Bank is also the second largest submarine bank of the South China Sea region.

Reminiscent of a sunken atoll, it consists of a broken reef rim that can be up to five kilometers in width and with average depths ranging from 12 meters to 18 meters enclosing a very deep central lagoon.

Old hand

Meanwhile, Palace spokesman Edwin Lacierda said that President Benigno Aquino 3rd has so much trust in the diplomatic skills of Ambassador Sonia Brady to resolve the issues with Beijing.

“Ambassador Sonia Brady is an old hand in Chinese affairs. She was previously our ambassador there so she has her friends, as we call [them], or contacts within the Chinese bureaucracy.

That’s something—that’s the reason why the President chose and the Secretary of Foreign Affairs recommended Sonia Brady to be the ambassador,” he said.

“And right now at least discussions will be made between the Philippine Embassy and the Chinese Foreign Ministry instead of a tete-a-tete between the Chinese Foreign Ministry and the Department of Foreign Affairs,” he added.
Asked to react on an article published in People’s Daily of China, which said that the Philippines was deliberately stirring up tensions in the West Philippine Sea, Lacierda warned the Chinese leadership to be careful of what they are saying.

“Can I say to the Chinese xiao xi ni tien! Be a little careful about your statements. The transcript, as Secretary Carandang said, would show the context by which the statement was made by the President. So there’s no issue to us. We do not view it as a provocative statement,” he said.

Last Tuesday, Strategic Communications Secretary Ramon “Ricky” Carandang disclosed that the government has been planting radars along the country’s coastlines to monitor the sea lanes, under a project he called “Coast Watch.”

This would be apart from a plan by the President to request the US military to help in monitoring its territories by using P3C Orion spy planes.

“We have taken a number of actions that try to enhance our ability to monitor our sea lanes.

I’m sure you’ve heard of Coast Watch. Coast Watch is a series of radars that we’re putting up around our territory with assistance from countries like Australia and the United States. So you have to view these surveillance flights, if they happen, in the context of a general effort to do that. Now, if nobody feels that Coast Watch is provocative, then they should not be viewed as provocative either,” he said.

Carandang said that every country has the right to monitor its territory and to do whatever means it sees necessary.

Bullied

For his part, House Minority Leader Danilo Suarez of Quezon province and Pastor Alcover of the Alliance for Nationalism and Democracy (ANAD) said the Philippines will be perpetually at risk of being bullied by China without United States’ intervention in the Panatag standoff.

“I will welcome any kind of aid that will give us decent protection against intrusions. It is humanly impossible to protect our whole coastline [as an archipelago]. With air surveillance, we can catch them [intruders],” Suarez said in a press conference.

Under the United Nations Convention on the Law of the Seas (Unclos), the Panatag Shoal belongs to the Philippines since it is located within Manila’s 200-nautical-mile exclusive economic zone. Both Philippines and China are signatories to the Unclos.

“If we are not going to come up with a deliberate move, we will get stomped by these people. The security of this country has no tag price. It is non-negotiable. It [President’s decision to seek US] is a just request,” Suarez added.

As it is, Suarez cited that intrusions from foreigners in the Panatag Shoal, as well as in other fishing grounds in the country, remain rampant because the Philippines cannot patrol its vast coastline by itself.

“Even Taiwan exports marine products. How can that be when they do not have fishing ground and we have a lot? That is because they poach our area. That is a problem for a small nation, it is subject to abuse,” Suarez pointed out.

Alcover, for his part, noted that calling for US assistance is a matter of leveling the playing field.

“China is bullying us. There should be balance of power. We are small. We need allies,” Alcover said.

Wrong place

Meanwhile, a key regional security summit between members of the Association of Southeast Asian Nations (Asean) is “not the right place to discuss the South China Sea issue,” a high-ranking official of the Chinese foreign ministry said late Tuesday.

During a regular press briefing, Chinese Foreign Ministry spokesman Liu Weimin said that the Chinese government believes that the Asean foreign ministers meeting, which will take place later this week in Cambodia, “is an important platform for enhancing mutual trust and strengthening cooperation” between Asian neighbors.

But he reiterated that the forum is not the right place to discuss issues concerning territorial disputes in the disputed Shoal.

“The situation of the South China Sea remains stable on the whole. The communication channels between China and other parties are open and effective,” Liu said.

“China is willing to continue to hold dialogues and consultations with countries involved to solve the South China Sea issue with peaceful means,” he added.

In the forum, Liu said that his government will exchange views with various sides on China-Asean relations, East Asia cooperation, Asia Pacific security cooperation and regional and international situations.

China will also discuss in the forum the preparations for the upcoming East Asian Summits in November.

“We hope achievements can be made in enhancing mutual trust between countries in this region and maintaining regional peace, stability and prosperity,” the official said.

Also on Tuesday, a commentary in the Communist Party of China’s mouthpiece, the People’s Daily, said that the Philippines is orchestrating a plot to deliberately stir the tension in the disputed waters.