OFWs urged: Come home more often, join FB, invite all

Rob Schneider- Hollywood Actor said: To be a Filipino, It's just fun anywhere 

Add a few more Facebook friends and earn the title "new tourism ambassadors" in the process.

The catchy campaign come-on was pitched by Tourism Secretary Ramon Jimenez Jr., who urged more than 9 million overseas Filipinos to "go into the social network and begin to connect with everyone else in the world."

"No matter how many kinds of Filipinos are in the world today—Filipino-Americans, Filipino-Chinese, Filipino-Italians, Filipino-Japanese, Filipino-Singaporeans, Filipino-French, Filipino-Arabs, Filipino-Germans, Filipino-Canadians and Filipino-Swedes, among others—there will always be only one type of fun. It's called Filipino fun," Jimenez said in a speech during the closing program of the Second Global Summit of Filipinos in the Diaspora on Feb. 27 in a Makati City hotel.

He said that kind of fun comes from an openness, which happens to be a common Filipino trait.

"To build a nation, one can only begin with the most basic of all ingredients—national pride. Your self-esteem, your confidence is what will make people sit up and take notice. They will praise you for your hard work, your perseverance, your intelligence, your discipline," he said.

"But if you are great fun, if you are confident in yourself, they will follow you in the Philippines," he added.

Come home

In his remarks, Jimenez also urged overseas Filipinos to come home to the Philippines more often.

Last year, a record 4.27 million tourists visited the country, a 9.07-percent increase over the 3.92 million visitors in 2011.

Jimenez expressed confidence that the 2012 figures could be surpassed this year with the help of the Filipino diaspora, which he said was "not just a spreading out of Filipinos."

"Because if all we did was to spread out, it could be the beginning of a separation, which is what makes this gathering very crucial, some important and so necessary," he said.

Common view

Jimenez said the tourism slogan "It's more fun in the Philippines" is an invitation to the world that Filipinos share more than a language.

"We share a common view of our world. We remind each other of the things that matter most—family, friendship and God," he added.

For his part, Foreign Secretary Albert del Rosario said the government was encouraging the active participation of overseas Filipinos and their involvement in national issues.

"Our foreign service posts are partners of the Commission on Filipinos Overseas  in communicating with and mobilizing overseas Filipinos to participate in various programs," including, among others, the Business Advisory Circle, which assists Philippine nationals abroad in setting up business partnerships in the country; the Alay Dunong program, which systematizes the skills and technology exchange between overseas Filipinos and the Philippines; and the Return and Reintegration Program, which assists balikbayans to successfully reintegrate into local life.

Proactive approach

Del Rosario said the country's embassies and consulates abroad were also taking a proactive approach to urge overseas Filipinos to join the country's overseas absentee voting and dual citizenship programs.

The government also puts the welfare and protection of the rights of Filipinos abroad in its top priorities, he added.

"In cooperation with other government agencies and international organizations, the DFA (Department of Foreign Affairs) has repatriated a total of 14,203 OFWs (overseas Filipino workers) from areas affected by civil strife or natural disasters, from 2011 up to the present. In particular, a total of 3,457 Filipinos were repatriated from war-torn Syria since the uprising began in 2011. Despite the ongoing crisis in the middle eastern country, the Philippine Embassy in Damascus continues its operations in order to evacuate the OFWs who remain there and ensure their safety and well-being," he reported.

Del Rosario said during the past eight years, 746 Filipino seafarers who fell victims to piracy had been released and repatriated through the joint efforts of the country's embassies abroad, manning agencies and the sailors' principals.

Last year, 122 Filipino victims of human trafficking and illegal recruitment were assisted by the DFA, he said.

In 2011, a total of 28 OFWs facing the death penalty were provided legal assistance by the agency. Last year, at least 40 of 130 OFWs with death penalty cases were commuted to life or fixed imprisonment, he said.

To further intensify efforts to promote and protect the rights of Filipino migrant workers, the DFA head said the Philippines had adopted a new qualification framework containing sets of training regulations for Filipinos that prescribe competency standards for various qualifications.

"The country also ratified in August 2012 the International Labor Convention (ILO) No. 189 on decent work for household service workers," said Del Rosario, noting the Philippines was the "first Asian nation to commit itself to the respect and implementation of the new ILO labor standard that was adopted on June 16, 2011, during the ILO conference in Geneva."

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ICAO lifted ban for Philippines planes flying to European Airspace?

International Civil Aviation Organization (ICAO)

After more than 5 years, local airlines may soon be allowed to fly again to Europe and to expand their operations in the United States after the government successfully passed a safety audit by the world's aviation regulatory body.

Transportation Secretary Joseph Abaya on Saturday said the findings of the one-week audit by the International Civil Aviation Organization (ICAO) were "positive," contrary to earlier reports.

"The ICAO Coordinated Validation Mission (ICVM) team was satisfied with their observations/findings on the [Civil Aviation Authority of the Philippines's] efforts to comply with international safety standards," Abaya said in a text message.

Passing the ICVM audit will likely pave the way for the lifting of ICAO's "significant safety concern (SSC)" tag on the Philippines issued in 2010. Other countries cited with deficiencies in the 2010 report were Angola, Bangladesh, Cambodia, Djibouti, Kazakhstan, Guinea-Bissau, Malawi, Rwanda and Zambia.

The ICAO had cited 89 points of concern in the country's aviation regulatory framework that jeopardized the safety of airline passengers. Among these were the registration of aviation companies and regulations covering the training of pilots and other industry personnel.

Findings sent to Canada

The ICAO audit was used by the European Union (EU) as a basis for the ban on local airlines from flying to any point in the economic bloc. The ban also meant that no Philippine carrier was allowed to even enter EU airspace.

Abaya said the ICVM's findings would be forwarded to the ICAO's headquarters in Canada. "They will recommend to ICAO headquarters the lifting of the significant safety concern issued on the Philippines," Abaya said.

Abaya said the official lifting of the EU's ban should come in two to three weeks.

In a statement, the Department of Transportation and Communications said the ICVM team focused on two "critical elements" during the audit. These were the certification of airlines in the Philippines and the registration of Philippine civil aviation aircraft.

Other areas covered were the legal, organization and licensing aspects which were "satisfactorily addressed" last October, the DOTC said.

"We are confident the ICAO will adopt/approve the recommendation," Abaya added.

The ICVM arrived in the Philippines last week on the invitation of CAAP, headed by retired Gen. William Hotchkiss, who assumed his post in July last year.

Hotchkiss dismissed reports that the ICAO team had given CAAP "failing marks" because it had only passed one of the five major issues looked into by the audit mission.

According to Hotchkiss, the CAAP team headed by Henry Gourdji called the validation mission a "success." The other members of the ICAO team were Amal Hewawasam, Vincent Lambotte, Christopher Dalton, Guseul Kim and Saulo Jose da Silva.

Encouraging, inspiring

"The exit briefing conducted by the ICAO audit team was on the whole very encouraging and inspiring for the CAAP team that had been tirelessly working for the lifting of the SSC tag that had been hounding CAAP for several years," he said.

"The team itself acknowledged during the closing of the review Friday that the present CAAP team was headed in the right direction. They were very satisfied with our efforts to comply with international safety standards," he said.

Hotchkiss said that CAAP was "very optimistic" that the recommendations would be approved and adopted by ICAO in an official announcement in two weeks.

He said that while the ICAO had yet to come out with a final report on the audit, officials who visited the country in the past months had expressed confidence that corrective measures on the remaining concerns shall be totally addressed by CAAP. (http://bit.ly/XwVMvY)

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Philippines: winning Japanese investment at the expense of China

Japan Sumitomo Corp : Sumitomo Corporation Launches Expansion of Industrial Park in the Philippines

The First Philippine Industrial Park, some 50km south of Manila, is already a whopper, accounting for about 3 per cent of the country's total exports. Which is why it is notable that Sumitomo Corporation, the Japanese trading house that owns 30 per cent of it, wants to make it even bigger.

By 2014, the 67 companies that currently call it home – including Honda, Canon, Nestle and Philip Morris – could be joined by 20 more, as Sumitomo spends about Y5bn to expand the 349-hectare site by almost a third.

The plan confirms two things. First, that Japanese companies will continue to steer funds into faster-growing, more dynamic economies – even as the recent depreciation of the yen makes investment back home that little bit more attractive.

The Philippines scores particularly well for its "rich human resources with good levels of English and high hospitality," says Yasushi Fukuda, general manager of Sumitomo's overseas industrial park division, which also runs parks in Vietnam, Indonesia and Thailand.

Japan's total FDI stock in the Philippines stood at just over $10bn at the end of 2011, according to government data, more than five times the level of a decade earlier – a rate of growth exceeded only by investment in India (13x), China (8x) and Thailand (6x) over that period, within Asia.

The second conclusion to be drawn is that a fair amount of this newer investment by Japan Inc is happening at the expense of China, as companies baulk at spiralling labour costs after the blow-up over a tiny chain of islands in the East China Sea.

Osaka-based Funai Electric was hit by wage-hike demands from Chinese workers after anti-Japan demos broke out last year, the Nikkei newspaper reported this week. It is now shifting production to a new site near Manila.

China was getting expensive already. Monthly base salaries for manufacturing workers in China grew by roughly 40 per cent over five years to $328 as of October 2012, according to the Japan External Trade Organization. By contrast, workers get $253 in the Philippines, $145 in Vietnam and $53 in Myanmar.

This year Japanese companies expect to pay Chinese factory workers 10 per cent more than in 2012, says Jetro – double the equivalent rate of increase in the Philippines.

Without naming China in particular, Fukuda of Sumitomo notes that wage hikes and worker shortages are driving many Japanese companies to consider "diversification of production facilities."

And where better than the Philippines, where about 97 per cent of Japanese companies with overseas operations are yet to venture?

Notably, it is not just the Hondas and Canons that Sumitomo is looking to lure. It says it is considering offering factory facilities for lease, with logistics and procurement support, as a way to encourage small and mid-sized Japanese businesses to set up shop.

Although the official sales promotion is yet to begin, "inquiries from prospective customers have been rapidly increasing," says Fukuda. (http://on.ft.com/XKxQHB)

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CNN: Fishermen caught out by politics of West Philippine (South China) Sea

Efren Forones (center) and his fellow fishermen embark on the 38-hour trip to fishing grounds around the disputed Scarborough Shoal.

Luzon, Philippines (CNN) -- A year ago, a fisherman Efren Forones came back from fishing trips with up to three and half tons of fish. In return he was able to buy 15 to 20 kilos of rice for his family every month and was planning to send at least one of his six children to college.

Not any more.

He now returns with just 400 kilos of catch at best, meaning he can only afford one to two kilos of rice a month, while school for his children is an expensive luxury and out of the question.

The reason? He says he can longer fish in the fertile waters around Scarborough Shoal.

A cluster of uninhabitable sand banks and small rocks set in a shallow azure water lagoon about 130 miles (200 km) west from the Philippine island of Luzon, Scarborough Shoal is one of a number of territories at the center of an international dispute in the South China Sea.

Both the Philippines and China lay claim to it.

Tense standoff

The long-term tensions between the two nations escalated last April during a one-month stand off between the two nations, after Manila accused Chinese boats of fishing illegally in the area. When a Philippines navy vessel inspected the boats it found "large amounts of illegally collected corals, giant clams and live sharks" inside one of the boats, according to the Philippine government. Manila then reported that two Chinese surveillance ships had taken up position at the mouth of the lagoon, blocking the way to the fishing boats and "preventing the arrest" of the fishermen. The vessels stretched a cable across the mouth of the lagoon, which also prevented Filipino fishermen from going there, according to the Philippines coast guard.

READ: Why Manila is taking China to tribunal

Earlier this year, the Philippine government took its feud with China to a United Nations tribunal, a move that Beijing has rejected. In an article on state-run CCTV last month, China pointed to a code of conduct it signed in 2002, known as the Declaration on the Conduct of Parties in the South China Sea, with fellow members of the Association of Southeast Asian Nations (ASEAN). It said the declaration expected that relevant disputes be solved through friendly talks and negotiations by sovereign states directly concerned.

That brings little comfort to the struggling fishermen in communities in west Luzon, the nearest region to Scarborough Shoal -- also known as Panatag Shoal here or Huangyan Island to the Chinese. One of them is Masinloc, a municipality of 40,000 people, which relies on the seas for almost 80% of its income, according to the Philippines Bureau of Fisheries and Aquatic Resources. It says thousands of fishermen have lost their regular jobs as catches decline.

Forones is one of them.

The 52 year old has been fishing in the waters off Masinloc for 22 years. He lives with his family in a traditional bamboo house mounted on pillars above the sea. His youngest daughter is four years old. Forones does not own a boat but used to be hired as a fisherman and paid a minimum of $85 dollars for a trip. Nobody is hiring now. He has tried to rent boats on his own and fish with his neighbors, but the little catch they bring back barely covers the rental fee and fuel.

READ: Asia's disputed islands -- who claims what?

He says the Shoal is the most important fishing ground in this region. "They (the Chinese) shoo us away, will not allow Filipinos to come near the area," he says. "They are the only ones that can fish there, not us. We lost Scarborough and it is hard. We earn nothing."

Beijing is unwavering in its claims. As recently as last month, the state-run Xinhua news agency reported that Chinese surveillance vessels were carrying out regular missions in the West Philippine Sea.

The Xinhua report cited Liu Cigui, director of the State Oceanic Administration, as saying that China would continue the patrols "to secure the nation's maritime rights and interests" in areas it claims as its territorial waters.

China's claim on the area dates back to 1279 during the Yuan Dynasty, when Chinese astronomer Guo Shoujing conducted a survey. Then in 1935, China declared sovereignty over 132 islands, reefs and shoals in the South China Sea, with the Scarborough Shoal -- or Huangyan -- included as a part of the Zhongsha Islands, according to Xinhua.

However, Forones is in little doubt who the lagoon, which lies within what the Philippines declares as its Exclusive Economic Zone, belongs to.

"Of course it is ours. We own Scarborough," he insists. "But China is trying to get it from us. Our government should fix that. We should seek help from the United States if the Philippine government cannot handle it alone."

Nowhere else to go

Forones and his wife plan to stay in Masinloc, for now. He will try to start diving for shellfish. By selling clams, mussels and oysters, they can make around $5 a day. Enough to buy rice and other basic food to feed the family. "There is no other place where we can go. I will stay here, get shells from nearby and help my husband to make living," Forones' wife, Gemma, says.

The situation is similar in Subic, a town 55 miles (88 km) south of Masinloc. It used to host one of the biggest American naval bases outside the United States, before it closed in 1991.

Operators of the fishing market on the outskirts of the town of 90,000 say business is down 50% since the fishermen were blocked from fishing where they wanted to at Scarborough. Many fishermen here share a similar story to their counterparts further north.

"When we went there, a Chinese vessel, the Chinese Marine Surveillance blocked our path," says Ronnie Drio, 46-year-old father of eight children. "As we managed to get past through it, it looked like they called another one because a different ship appeared and blocked our way again.

"That's when we got trapped. Then a Chinese man stepped out. He looked like their highest officer. He flashed a sign that we had to leave immediately. We were kicked out like pigs."

A number of fishermen have already left Subic and Masinloc and many more are considering it. One of them, 58-year-old Tolomeo "Lomi" Forones, is Efren's cousin. He's been a fisherman for 30 years but now makes a living as a motorbike taxi driver. He makes around $2 on a good day.

"Our income was higher when we used to fish at Scarborough. I even used to save money. But now we earn just enough for daily consumption and sometimes what we earn is not even enough to provide food."

Dangerous waters

He still does occasional fishing trips but against his wife's wish. Janet Forones wants to leave Masinloc and their low income is not the only reason: "Who would not get worried when they are out there? What if they get shot?" She was referring to the presence of the Chinese boats.

What puzzles the fishermen here most is the speed the whole situation has changed. Although the Philippine and Chinese governments have disputed each other's claim to the lagoon for many years, they could fish at Scarborough alongside Chinese fishermen up until a few months ago.

"I do not know why they don't like us or why they do not want us within that area. If Americans were still in the region, the Chinese would have never came to Scarborough because they would be scared. If our government allows the U.S. to come back over here, its OK with me," she says, referring to Washington's commitment to its mutual defense treaty with the Philippines that former Secretary of State Hillary Clinton reaffirmed last year.

But the solution to the dispute is as distant as ever. Litigation at the United Nations could last years. Most of the local fishermen do not have so much time. So while the governments squabble, many of these fishermen and their families will have to leave the only life they have known and start from scratch somewhere else. (http://bit.ly/ZpDToT)

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Philippines Approves Xstrata $5.9 Billion Mine Environmental Permit

The Philippines environmental regulator has given a unit of Xstrata PLC (XTA.LN) conditional approval to develop what will be Philippines' largest gold and copper mine.

Environmental approval at the $5.9 billion Tampakan mine, which the company has said will produce around 375,000 tons of copper and 360,000 ounces of gold a year over a 17-year period, has been complicated by a ban on open-pit mines in South Cotabato province. The mine, which covers nearly 100 square kilometers, also straddles Sarangani, Sultan Kudarat and Davao del Sur provinces on the southern island of Mindanao.

Xstrata Copper subsidiary Sagittarius Mines Inc. will still need approval from the local government and other state agencies, Environment and Natural Resources Secretary Ramon Paje said in a statement.

Sagittarius Mines said Tuesday in a statement that it has received the permit and is "reviewing the terms and conditions contained in the document."

Construction at the mine "could potentially commence in 2015, enabling commercial production in 2019," Sagittarius Mines President Peter Forrestal said in December.

Sagittarius Mines took control as operator of Tampakan in 2007. The project is a joint venture among the Tampakan Group, Xstrata and Australia-listed Indophil Resources NL (IRN.AU). The Tampakan Group--composed of local businesses--owns 60% of Sagittarius Mines, with the balance shared by Xstrata and Indophil, which in turn is partly owned by Philippine conglomerate San Miguel Corp. (SMC.PH).

The Chamber of Mines of the Philippines, a mining industry group, welcomed the environmental permit's issuance.

"It's an encouraging sign from the government, which has[said] that the Philippines needs at least $3 billion in investments to create jobs," the chamber said.

The government cut its investment target for mining last year to $509 million from $2.27 billion due to delays in some projects. The investment target this year was also reduced, to $718.5 million from $2 billion previously. The mining industry had pointed to uncertainty in the government's mining policy, permitting challenges and a moratorium on the grant of new mining licenses as reasons for project delays.

Although the Philippines is the world's third-largest nickel producer and contributes to the global trade in other metals, the value of mining exports has slipped from more than 20% of the country's total exports four decades ago to less than 6% in 2011. (http://fxn.ws/UCwxvt)

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DOST’ S&T Led “Smarter Philippines” 2018 Pinoy Innovation

Disaster Risk Exposure Assessment for Mitigation – Light Detection and Ranging (DREAM-LIDAR) Project

'Smarter Philippines' DOST's new program

Science Secretary Mario Montejo has a new catchphrase for the various information and communications technology-driven, Filipino-developed technological innovations that his department has initiated and will initiate in the next five years.

"The 'Smarter Philippines' program is the Department of Science and Technology (DOST) trademark for the next five years," Montejo said in his first news conference for the year.

"It is anchored tightly on the DOST's goal of using S&T (science and technology) to improve the quality and productivity of every Filipino's life," he said.

He said Smarter Philippines is the umbrella program that will encompass the DOST's S&T initiatives on various fronts such as disaster mitigation, governance, health care, agriculture and transportation.

The DOST will formally launch the program in Davao City to showcase some of its ongoing projects for the following:

1. Project Noah (Nationwide Operational Assessment of Hazards) disaster warning system and its biggest component
2. The Disaster Risk Exposure and Assessment for Mitigation-Light Detection and Ranging (Dream-Lidar) flood forecasting system
3. The Integrated Government Philippine (iGovPhil) project, which was rolled out in June and which seeks to integrate and interconnect the government's ICT systems
4. Smarter Farms
5. Smarter Healthcare.

Montejo stressed that all the innovations were developed by Filipino experts.

"We will brandish world-class products and processes that are conceptualized by local talents and experts and developed using local technologies," he said.

Montejo also cited the DOST's most recent innovations, namely, the ₱350-million state-of-the-art Advanced Device and Materials Testing Laboratory (Admatel) for the semiconductor and electronics industries and the Automated Guideway Transit that is currently being tested as an alternative mass transportation system.

In the pipeline, Montejo said, are the dengue diagnostic kit, dengue early warning system, drugs made from local herbs and the RxBox that will connect health professionals in the countryside.

In agriculture, he said the DOST and the Department of Agriculture were designing farm implements for more effective farming. (http://bit.ly/WDhhwM)

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Bloomberg: Philippines Cleanest Government - Trounces Global Stocks in Aquino-Led Rally

The world's biggest equity bull market is propelling Philippine valuations to all-time highs as international investors pile into the country's stocks in an endorsement of President Benigno Aquino's economic policies.

The Philippine Stock Exchange Index has climbed 13 percent this year, bringing gains since October 2008 to 285 percent, at least 124 percentage points more than every other bull market in emerging and developed nations, according to data compiled by Bloomberg. The index turned into Asia's most expensive from the second-cheapest four years ago as rallies in Ayala Land Inc. and Bank of the Philippine Islands lifted the gauge to 19 times estimated profits.

Aquino's efforts to boost spending on government projects and tackle corruption are convincing foreign investors to look past the nation's speculative-grade credit rating and focus on the third-fastest growth in Asia after China and Thailand. While Invesco Ltd. says shares are too expensive, Samsung Asset Management and Religare Capital Markets see further gains of at least 20 percent and an investment-grade ranking this year.

"Funds will remain net buyers," Alan Richardson, who helps oversee about $110 billion as a money manager at Samsung Asset in Singapore, said in a Feb. 6 e-mail. "The focus is on opportunity and growth rather than contraction caused by deleveraging, bank recapitalization, fiscal austerity and increased regulatory oversight in many of the developed economies."

Bull Rally

The benchmark gauge for the nation's $236 billion equity market rose 0.7 percent yesterday to 6,565.23. The bull market, defined as an advance of at least 20 percent from the most recent low without a drop of the same magnitude on a closing basis, is the biggest since Bloomberg began compiling Philippine index data in 1987.

Mexico's IPC Index has climbed about 161 percent since March 2009, making it the second-biggest bull market among 45 emerging and advanced countries, while the Standard & Poor's 500 Index is up 125 percent from a low in the same month. In China, the biggest emerging market, the Shanghai Composite Index has increased 24 percent from its Dec. 3 low.

Philippine shares will probably return about 38 percent by the end of 2014, according to Samsung's Richardson. The benchmark index may rally 20 percent to 30 percent this year, said John Sturmey, head of equity capital markets at Religare Capital Markets, a unit of New Delhi-based Religare Enterprises Ltd.

Foreign Inflows

"We are very bullish on the Philippines for this year and the following years," Sturmey said in a Feb. 5 interview in Manila.

Foreign investors purchased a net $819 million of shares in Asia's 12th-biggest stock market this year, 120 percent more than during the same period a year ago, according to Philippine Stock Exchange data compiled by Bloomberg. The nation of about 100 million people recorded $2.5 billion of inflows last year, the most since Bloomberg began tracking the data in 2000.

Growing confidence in the economy is also boosting the nation's currency and debt. The peso has appreciated 5 percent against the dollar during the past 12 months, the most in emerging markets, and reached the strongest level since 2008 last month at 40.55 to the dollar.

Economic Growth

Yields on local-currency debt, rated BB+ by Standard & Poor's, fell to a record 3.76 percent on Jan. 28, according to the JPMorgan GBI-EM Philippines Index. The cost to insure government bonds, rated one level below investment grade, against non-payment for five years using credit-default swaps was 103 basis points yesterday, data compiled by Bloomberg show. That compares with 121 for Brazil, whose foreign-currency debt is rated two levels above the Philippines.

Philippine gross domestic product increased 6.8 percent from a year earlier in the fourth quarter, compared with 7.9 percent in China. The euro region contracted during the period, while the U.S. expanded 1.5 percent.

Aquino plans to boost spending to a record and seek more than $17 billion of infrastructure investments to spur growth of at least 6 percent this year. Projects to build a toll-road south of Manila and more than 9,300 classrooms have already been announced since he took office in June 2010.

The 53-year-old president has narrowed the budget deficit by cracking down on tax evasion and raising taxes on liquor and tobacco. The gap was probably 2.3 percent of GDP in 2012, Budget Secretary Butch Abad said in a Feb. 14 interview in Manila. That's down from 3.5 percent in 2010, according to Philippine Department of Finance data.

Fighting Corruption

Aquino, who had a 66 percent approval rating in a January survey conducted by Pulse Asia, has also focused on reducing corruption. Renato Corona, the country's top judge, was ousted in May for illegally concealing his wealth.

The Philippines was ranked 105 on Transparency International's 2012 Corruption Perceptions Index, an improvement from 134 in 2010. A lower ranking signals less corruption.

"The macro environment looks very positive and the Philippines probably has the cleanest government in its history," Alistair Thompson, deputy head of Asia Pacific ex- Japan equities at First State Investments in Singapore, said in a Jan. 16 phone interview. "Companies are very optimistic." His firm oversees about $147 billion.

Philippine stock valuations already reflect the good news, according to Paul Chan, the Hong Kong-based chief investment officer for Asia ex-Japan at Invesco, which oversees about $713 billion.

More Expensive

The benchmark index's valuation of 19 times projected 12- month earnings is the highest since Bloomberg began compiling the data in January 2006 and 46 percent more expensive than the MSCI All-Country World Index. The Philippine gauge has the world's second-highest multiple after Greece's ASE Index, which trades at 22 times estimated profits, the data show.

Ayala Land, a Manila-based developer, is valued at 39 times 2013 profit forecasts, more than twice the median multiple for global peers, according to the average of 14 projections compiled by Bloomberg.

Bank of the Philippine Islands, the country's biggest lender by market capitalization, trades for 4 times net assets, versus the 1.6 industry average.

Earnings-per-share in the Philippine index will probably increase 14 percent in the next 12 months, versus 25 percent for the MSCI All-Country gauge, according to analyst estimates compiled by Bloomberg.

Earnings Outlook

"The Philippines is a very crowded market," Chan said in a Feb. 7 phone interview. He cut Philippine positions to less than 1 percent of total holdings from "much higher" levels last year and prefers shares in China and South Korea, where price-earnings ratios are about half the level of the Southeast Asian nation's.

There is "probably room" for Philippine stock valuations to climb as long as growth in earnings and the economy can be sustained, Hans Sicat, president of the country's bourse, said in a Feb. 15 interview in Tokyo.

First State's Thompson said he purchased shares of Manila- based BDO Unibank Inc. after visiting the country in November. The nation's second-biggest bank by market value trades for 2.2 times net assets, about half the multiple of Bank of the Philippine Islands.

Rating Trend

"We remain positive," Douglas Cairns, an investment specialist for Asia and emerging-market equities at Threadneedle Investments in London, which oversees about $122 billion, said in an e-mail on Feb. 7. Cairns said the firm has overweight holdings in Philippine shares, meaning positions exceed the country's representation in benchmark indexes.

An investment-grade credit rating may open Philippine capital markets to pension funds and endowments that have avoided the country, according to Samsung Asset's Richardson.

The rating will probably be upgraded in the first half, central bank Governor Amando Tetangco said in a Bloomberg Television interview on Jan. 25. S&P raised its outlook to positive from stable on Dec. 20, citing the stability of Aquino's administration and economic growth.

GDP will probably increase 6 percent to 7 percent this year and accelerate in 2014, Economic Planning Secretary Arsenio Balisacan said at a forum in Manila on Feb. 13.

Investors should add to their stock holdings on any declines, Christopher Wood, a Hong Kong-based strategist at CLSA Asia-Pacific Markets who recommends a bigger overweight position in the Philippines than any other equity market in Asia excluding Japan, said in a Feb. 7 report. "In such a structural bull market, those investors who focus too much on valuations sell way too early."

To contact the reporter on this story: Ian Sayson in Manila at isayson@bloomberg.net ; Weiyi Lim in Singapore at wlim26@bloomberg.net ; Michael Patterson in Hong Kong at mpatterson10@bloomberg.net (http://bloom.bg/151A34I)

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₱1.83-Billion NIA III upgrade budget release; Clark as the next Asia’s ‘aerotropolis

 

Philippines to spend $45 million for airport upgrade

The Philippine government has released $45 million to spruce up its newest airport terminal in a bid to boost tourism.

Budget Secretary Florencio Abad said Tuesday that the completion and upgrade of Terminal 3 of Ninoy Aquino International Airport will ease traffic on the 32-year-old Terminal 1.

Terminal 3, which opened in 2008, is already operating over its capacity, with 13.8 million passengers last year, more than 800,000 over its capacity. Once it is upgraded, it will handle more international flights, easing the load on Terminal 1, which is solely for international flights.

Originally designed for 4.5 million passengers yearly, Terminal 1 handled 8.2 million passengers last year, up from 7.8 million in 2011. A majority of the passengers at the airport's Terminal 2 are domestic passengers. (http://bit.ly/X1JaQn)

Clark International Airport as Asia's next 'aerotropolis

With the world's economic center of gravity rapidly moving eastward, there is increasing urgency to develop Clark International Airport into an aviation hub, and this is the focus of a two-day conference to be held this month at the Clark Freeport Zone in Pampanga.

"The Case for Asia's Next Aerotropolis" is the theme of the Clark Aviation Conference 2013, a trade gathering that will examine Clark's compelling case as an aerotropolis, an idea in community planning where airports serve as the center for new cities growing around them.

The conference, being organized by Clark International Airport Corp (CIAC) in partnership with Global Gateway Logistics City, takes place Feb. 21-22, 2013, at the Widus Convention Center in Clark Freeport Zone. It coincides with the annual Hot Air Balloon Fiesta.

"The event will highlight Clark International Airport's critical role in easing air traffic congestion in Manila and driving economic expansion in Central Luzon. It will also identify infrastructure and policy developments at Clark Freeport Zone that are designed to attract airport-related businesses and investments," said CIAC president and CEO Victor Jose Luciano.

"More importantly, the conference is a call for the full development of Clark International Airport as an aviation nerve center in the light of the economic growth in Asia."

Heads of government agencies—including Tourism Secretary Ramon Jimenez, Bases Conversion and Development Authority president Atty. Arnel Casanova and Trade Assistant Secretary Fe Agoncillo-Reyes—and private-sector representatives will look at Clark's prospects as an aviation and investment destination in Asia, even as they examine pressing aviation and tourism concerns and propose sustainable and long-term solutions.

Keynote speaker is Greg Lindsay, the US-based co-author of the bestselling book, Aerotropolis, The Way We'll Live Next. Other speakers include Tourism Undersecretary Daniel Corpuz, John Forbes of the Joint Foreign Chambers of Commerce, former Tourism Secretary Narzalina Lim, and Capt. Benjamin Solis, adviser of CIAC.

The convention targets international investors, logistics and supply chain executives, tourism stakeholders, airline officials, import and export managers, and members of the academe. They are expected to gain insights into Clark's potentials as an aviation and investment destination in Asia and understand better its increasing role in national and regional development.

To register or make inquiries, call event manager PortCalls at (632) 552-7072, (632) 551-1775, or (0917) 5555273; or email lizaalmonte@portcalls.com. For more details, log on to clarkaviationconference.com. (http://bit.ly/14MPsFK)

INQUIRER Business

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South Korean ratings agency gives Philippines a credit lift

The Philippines got a ratings boost from South Korea's NICE Investors Service Co. Ltd., which took into account various factors, including the country's improved fiscal policy, private consumption and the strong Philippine peso.

In a report distributed to reporters on Tuesday, NICE rated the country's long-term foreign currency at "BB+," with a positive outlook. The Philippines is currently rated one notch below investment grade by the top three credit-rating agencies, with a potential upgrade anticipated within the year.

In its report, NICE said that weak taxes have been holding back improvements in the country's fiscal condition but it noted that the Aquino administration has "advanced its tax administration, increasing overall tax revenue."

"In addition, the government has been committed to fiscal consolidation by taking various measures, like enacting the 'sin' tax law and implementing other fiscal-reform actions," it added.

"As the government has consistently enhanced the business environment to attract more investment, the efforts are expected to begin to deliver visible outcomes in the future," the agency said.

Cited in the report were "solid" private consumption, partly driven by continued growth of money from overseas Filipino workers [OFW], and the rapid expansion of the business process outsourcing (BPO) sector.

"Consumption based on [OFW] remittances is robust enough to absorb external shocks to some extent; on the back of increasing government expenditure and rebounding export, the economic growth rate of 2012 is expected to jump from that of the year before," NICE said.

While the strong peso has been cited as hurting the BPO and export businesses, the debt watcher said the currency's appreciation combined with the global economic slowdown has "largely contributed" to price stabilization.

NICE cautioned that relatively large public debts to gross domestic product have undermined the government's ability for infrastructure investment and that the share of foreign currency-denominated debts is still relatively high.

"But the increasing mid/long-term domestic borrowings may limit default risks that would be triggered by external changes," it said. (http://bit.ly/VW1zuv)

Business Mirror

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Dole Philippines to finally ship bananas to US

Dole Philippines may now ship Cavendish to the United States after the maiden export of the commodity was frustrated by Typhoon Pablo last December, the Bureau of Plant Industry said Monday, noting that the shipment was cleared by the US Department of Agriculture (USDA).

An initial shipment of 3,000 metric tons will be made in the first quarter, said Bureau director Clarito Barron.

The Philippine official said his American counterpart, Kelan Evans of the USDA Animal and Plant Health Inspection Service (APHIS) conveyed the official import ruling that covers the the shipment to the US mainland.

Barron and Evans met on Monday, during which the US official also said that the USDA- APHIS certified mango plantations in Davao Oriental and Samal Island as pest-free. "This means that we may also export mangoes from these areas other than Guimaras," Barron noted.

No volume has yet been specified for mango shipments to the US. "We are still working on the protocols for that," said Barron.

Typhoon Pablo destroyed banana plantation in Davao and Campostela Valley in early December, which compelled the Philippines to postpone the maiden shipment of Cavendish to the US to cover existing export contracts with Japan and South Korea. (http://bit.ly/VKjFl9)

GMA News

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Bangko Sentral biggest Challenge: So much money coming in to the Country

Amando Tetangco, governor of Bangko Sentral ng Pilipinas, seen in this Oct. 8, 2012 photo, said interest rates will remain low this year even as growth will probably meet the government's 6 percent-to-7 percent target. Amando Tetangco, governor of Bangko Sentral ng Pilipinas, seen in this Oct. 8, 2012 photo, said interest rates will remain low this year even as growth will probably meet the government's 6 percent-to-7 percent target. Photographer: Julian Abram Wainwright/Bloomberg

Bloomberg published "Philippines Joins Korea in Weighing Steps to Curb Inflows" also explained how would it affects the country's economy if left uncontrolled.  

Philippine central bank Governor Amando Tetangco said he's studying more measures to counter excessive capital inflows lured by growth, joining South Korea and Singapore in warning that policy makers need to consider more steps to reduce the impact of such funds.

"Capital flows and the impact of these on the local economy and local financial markets" would be among the biggest challenges this year, Tetangco said in an interview in his office yesterday. "We continue to study what other measures can be implemented just in case there's a need to adopt more measures in the future."

Monetary easing in developed nations from Japan to the U.S. and Europe has spurred flows to faster growing emerging markets as investors seek higher returns, boosting Asian stocks to the highest in 17 months this week. Bangko Sentral ng Pilipinas can't rule out further reductions on the rate it pays on funds placed in its special deposit accounts after a cut last week, Tetangco said.

"It's becoming challenging to manage inflows with so much of it coming in and increasing liquidity in the system," said Santitarn Sathirathai, a Singapore-based economist at Credit Suisse Group AG. "What the central bank doesn't want is for these funds to go into speculative activities, like to the property sector."

The Philippine economy grew 6.8 percent last quarter from a year earlier, the government said today, beating the median estimate of 6.3 percent in a Bloomberg News survey. Gross domestic product increased 6.6 percent in 2012, it said.

Gradual Appreciation

Singapore central bank Managing Director Ravi Menon said yesterday Asian policy makers should allow a gradual appreciation of their currencies along with other measures to keep inflationary pressures contained as the region faces a "wall of money." South Korea should consider taxes on currency trading and bonds to help limit "speculative" inflows of capital, Deputy Finance Minister Choi Jong Ku said yesterday.

Thailand will set up a team of economists, including central bank Governor Prasarn Trairatvorakul, to study how to respond to short-term capital inflows, Finance Minister Kittiratt Na-Ranong said yesterday. The country won't impose capital controls or tax measures to curb fund flows, he said.

Interest rates will remain low this year even as growth will probably meet the government's 6 percent-to-7 percent target, Tetangco said.

"From our point of view, we do not see signs of overheating in the Philippine economy," the governor said.

New Limits

Bangko Sentral in 2012 announced limits on banks' currency forward positions and banned overseas funds from special deposit accounts. Last week it cut the rate it pays on 1.72 trillion pesos ($42 billion) in its so-called SDAs to 3 percent from more than 3.5 percent. It kept the benchmark overnight borrowing rate unchanged at a record-low 3.5 percent.

"By introducing more macro-prudential measures, they're able to target specific concerns unlike using the main interest rate, which is a blunt tool," Santitarn said.

Philippine outsourcing companies have called on policy makers to curb the peso's gains to sustain competitiveness. Inflows must be managed as currency gains may hurt exporters and low rates may spur asset bubbles, New York University Professor Nouriel Roubini said in a speech in Manila yesterday.

"We don't see evidence of stretched market conditions at this point in time but we continue to monitor," Tetangco said. "We don't target a particular exchange rate. Our policy is the same; we won't go against the fundamental trend but reserve the right to step in the market to smoothen excessive volatilities as may be necessary."

Top Performer

Capital inflows have boosted Philippine stocks and helped make the peso Asia's best-performing currency in the past 12 months.

The peso climbed to 40.55 per dollar on Jan. 14, the strongest level since March 2008. It was little changed at 40.66 as of 10:15 a.m. in Manila, according to Tullett Prebon Plc. The yield on the three-year peso bonds fell to 3.29 percent this week, the lowest since September 2011. The main stock index climbed 0.6 percent today, extending a record high.

The $225 billion economy is on the cusp of an investment- grade rating, President Benigno Aquino said this month. That would attract inflows, Tetangco said yesterday.

The Philippines has the highest junk rating at Moody's Investors Service, Fitch Ratings and Standard & Poor's. S&P raised the outlook to positive last month and said an upgrade is possible in 2013 on improved governance and public finances.

Encourage Outflows

The Philippines may consider further loosening foreign- exchange rules to encourage outflows, Felipe Medalla, a member of the central bank's Monetary Board, told reporters yesterday.

"We're not thinking of imposing holding period for investments in stocks," Medalla said. "If at all, maybe on fixed income, because people who go to fixed income do carry trade. We're studying everything."

South Korea's finance official Choi said yesterday his government may further tighten restrictions on banks' currency forward positions. South Korea on Nov. 27 capped currency forward positions at 150 percent of equity for branches of foreign banks. The limit is 30 percent of equity for domestic banks.

Tools other than interest rates have to be used as emerging-market economies such as the Philippines try to curb volatility, sustain growth and keep prices stable, Tetangco said.

"The policy rate remains the main instrument of monetary policy," he said. "Over the long run, we may develop an interest-rate corridor. What we did last week was an intermediate step towards that. It's a medium-term objective."

Bloomberg 

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