Why Gloria’s P330-B “Stimulus Package” Will Fail: A Critique of the Economic Resiliency Plan (ERP)

Part 1 of a two-part series

Publicized as a “stimulus package”, the Economic Resiliency Plan (ERP) is criticized even by neoliberal economists as severely lacking in funds to stimulate economic activity amid the global downturn. Aggravating these funding problems is the perennial shortfall in government revenues to support its expenditures thus, government will further increase its borrowing and impose new taxes. Even the social security programs under the ERP are extremely limited both in funding and scope.

BY ARNOLD PADILLA
Contributor
Bulatlat

The Economic Resiliency Plan (ERP) is a package of programs put together by the Arroyo administration in response to the global financial and economic crisis. Its stated objectives include the mitigation of the crisis’ impact and the invigoration of the domestic economy through a mix of accelerated government spending, tax cuts and public-private sector investments in infrastructure projects.

For the Filipino workers, the ERP aims to save and create as many jobs as possible and to protect the returning overseas Filipino workers (OFWs) and workers in export industries. The whole package costs P330 billion, of which almost half would be funded by the increase in the 2009 national budget. (See Table)

Funding issues

Publicized as a “stimulus package”, the ERP is criticized even by neoliberal economists as severely lacking in funds to stimulate economic activity amid the global downturn. According to them, a real stimulus package needs significant additional resources on top of what the government has already planned to spend. But it is estimated that of the P330 billion (US $6.92 billion based on current exchange rate of USD 1 = PhP47.672) allocated for the ERP, only P50 billion ($1.85 billion) can be considered as new funds. The said amount represents the sum realigned from the P252 billion allotted for servicing debt interest payments in the P1.41-trillion ($ 29.58 billion) national budget for 2009.

The P50 billion ($1.85 billion) forms part of the P160 billion ($3.35 billion) allocated for the ERP from a total P188-billion ($3.94 billion) increase in the 2009 budget. Thus, P110 billion ($2.3 billion) of the said amount could not be considered a stimulus fund because it was already a planned increase without accounting the global crunch. If we compute the P50 billion as a portion of the gross domestic product (GDP), it is equivalent to only 0.67 percent, said economist Winnie Monsod. Compare it with, say China’s stimulus package, which is about 18 percent of its GDP. In a briefing paper, think tank IBON Foundation pointed out that the 2009 national budget is equal to only 16 percent of the GDP – the lowest since 1986! It confirmed that the current budget was not designed to respond to the global crisis.

Meanwhile, the P100 billion ($2.09 billion) of which a portion would be bankrolled by government financial institutions and social security institutions is facing serious uncertainty. A counterpart fund is supposed to come from private investors to raise the amount needed to fund large infrastructure projects. But as of this writing, administration officials have yet to clinch a definite commitment from private business. They have been negotiating with the Philippine Chamber of Commerce and Industries (PCCI) but the said group threatened to back out in February if they will not get guarantees from government and if the projects will not start in the first half of the year. A portion of the P100 billion ($2.09 billion) will be also sourced from the Social Security System (SSS), which proposed to shell out P12.5 billion ($26 million) for the ERP. However, it is facing uncertainty as well due to strong resistance from SSS members and some lawmakers.

The P40 billion ($839 million) in tax cuts under the ERP are of course not fresh funds provided by government. They represent the estimated additional savings for low- and middle-income earners and corporations accruing from the Reformed Value Added Tax (RVAT) Law enacted in 2005. Finally, the P30 billion ($629 million) in additional benefits to members of social security institutions like the SSS and Government Service Insurance System (GSIS) are also unsure. They will depend on the viability of the said institutions’ investments. Arroyo’s own economic adviser, Albay Governor Joey Salceda, doubted such viability and pointed to the “paper losses” of the SSS and GSIS in their stock market investments, a consequence of the global economic turmoil.

More debts, more onerous taxes

Aggravating these funding problems is the perennial shortfall in government revenues to support its expenditures. The budget deficit this year is expected to jump to P177.2 billion ($3.71 billion) up to as much as P257 billion ($5.39 billion), which some analysts predicted as not even the worst case scenario. Such high budget deficit is not entirely due to government’s pump priming efforts, which as already discussed, could not even be considered real pump priming. Revenues will surely fall this year as corporate incomes drop and the number of wage earners decline because of the global crisis, adding to the already significant number of businesses that have been folding up and displacing workers even before the recession of the world economy. Already, the Bureau of Internal Revenue (BIR) and the Bureau of Customs (BOC) have both lowered their collection targets for this year by P44.4 billion ($923 million) and P39.8 billion ($834 million), respectively.

The Arroyo administration then will have to further increase its borrowing. This year, it plans to increase its foreign debt by $500 million and its domestic debt by P55.45 billion ($1.16 billion). But borrowing from domestic banks will further worsen the situation for local businesses scrambling for much needed capital as they will need to compete with government for loans and raise interest rates in the process. Government thus would have to turn more to foreign creditors. But the question is will the foreign loans be available? According to the Institute of International Finance (IIF), net bank lending to emerging economies this year will see a negative swing of $227 billion (i.e. more outflows than inflows) as investors become more risk averse amid the deepening global crisis. With a tight supply of credit from foreign sources, government would be forced to accept even more onerous terms, including more burdensome conditionalities such as liberalization, deregulation and privatization, tied to these foreign loans.

To fund these debts, government is pushing for more onerous taxes on consumers already heavily burdened by the regressive VAT. Proposals to impose a tax on text messaging have been revived in Congress aside from plans to enforce new taxes on so-called sin products, soft drinks, and other consumer items. These additional taxes on ordinary consumers amid massive displacements become more outrageous considering that at the same time, proposals to provide new tax perks for big business are also being pushed in Congress while fresh liberalization commitments – reducing or eliminating tariffs on imports – through free trade deals are in the offing.

They include House Bill (HB) 6073 of Speaker Prospero Nograles which intends to attract more agribusiness firms in the country by giving them a host of tax incentives, implementation of new liberalization commitments under the ASEAN Free Trade Area (AFTA) and the Japan-Philippines Economic Partnership Agreement (JPEPA), as well as negotiations for new deals such as the Partnership Cooperation Agreement (PCA) with the European Union (EU). All these will deprive the country of billions of pesos in potential revenues, which the Arroyo administration plans to compensate as usual by burdening consumers and ordinary income earners with more taxes.

Social (in) security

Aside from paying for the additional debt that government will surely incur to fund the ERP, ordinary income earners and taxpayers will also directly shoulder a significant amount of the Arroyo administration’s stimulus package. The supposed added benefits to members of social security institutions apparently would come from their extra contributions, and not from government funds. NEDA, for instance, is proposing to extend P10, 000 ($209) in so-called “unemployment benefits” to SSS members affected by the global economic turmoil. The said agency did not specify where it intends to source the money for this, but SSS raised the option of increasing the contributions from its members to bankroll the unemployment benefits.

As part of expanding the benefits of members of social security institutions, the SSS has already approved a P500-million ($10.48 million) fund to allow its members hit by the global crunch to avail of a maximum P15, 000 ($314) in emergency loans. But because the scheme involves loans instead of grants, it only threatens to bury in deeper debts the jobless SSS members who face a worsening uncertainty of finding a job soon, if at all. The said social security institution has also set strict and highly restrictive guidelines for those who can avail of the emergency loan. To illustrate, only SSS members who were retrenched from work starting January 1 are eligible, must have updated contributions and updated loan amortization. In other words, the SSS is further milking the workers dry instead of making available to them funds, which come from the workers themselves through their contributions, to help them cope with the raging crisis.

The ERP also intends to supposedly expand government’s social protection programs including the so-called Conditional Cash Transfers (CCTs). But this program is also criticized for being extremely limited both in funding and scope. For instance, out of some 4.5 million poor households nationwide, CCTs target only 321,000, mostly in Metro Manila. (See Table)

The CCTs is an old program of the Arroyo administration that is being funded mainly through the so-called “Katas ng VAT”. But since a huge portion of government’s VAT collections comes from the poor and ordinary income earners through their VAT payments for petroleum products, electricity, water and other essential goods and services, the ordinary people themselves are the ones funding the CCTs. Furthermore, CCTs are also meaningless amid skyrocketing cost of living, deteriorating jobs crisis and worsening poverty in the country that remain unaddressed and are even aggravated by wrong economic policies of government.

Meanwhile, the education and health components of the ERP will not have an impact on the social protection needs of the people as long as the overall policy direction of government is to privatize and commercialize the country’s public hospitals and schools such as HB 3287 of Rep. Roque Ablan Jr., which intends to corporatize 68 public hospitals nationwide. ERP’s health and education programs are also lip service in the context of meager and declining national budget for social services. In fact, compared to the Aquino, Ramos and Estrada administrations, the Arroyo administration posts the lowest annual budget allocation for health (1.7 percent of the national budget), education (15.2 percent, second lowest behind Aquino’s 12.3 percent) and housing (0.4 percent). (To be continued)(Bulatlat.com)

Editorial Cartoon: TV Show

Media milage o pampasira ng screen ng tv? 😀

Govt’s stimulus package mere gimmick–IBON

By Rommel C. Lontayao, Reporter

The Palace said the allocation for the economic stimulus package is not an old measure contrary to the statements of the independent think tank Ibon Foundation.

Ibon on Friday said in a statement that the government’s P330-billion stimulus package is a “mere spin” of “existing allocations . . . to create the impression that something is being done to address the crisis.”

“These ‘stimulus’ funds are already there even before the recent descent into crisis . . . There is very little to indicate that . . . government is pouring any substantially new efforts to deal with the economic downturn,” said IBON research head Sonny Africa.

Deputy Presidential Spokesperson Anthony Golez belied the statement, saying the current stimulus package is a genuine allocation intended to finance infrastructure projects and create jobs.

Golez said that besides providing assistance to the marginalized sector, the package is also expected to create three million jobs this year on top of the regular job-generation programs of various government agencies.

The reported stimulus plan, which opposition Bayan Muna Rep. Teddy Casiño calls a “simulation package,” includes the P160-billion increase in the 2009 national budget, the P100-billion off-budget infrastructure fund, the P40-billion corporate and individual tax breaks, and alternative livelihood programs, among others.

Africa said that contrary to what government officials claim, the P1.4-trillion budget for 2009 is not a pump-priming budget, and actually is the smallest share of government spending to the GDP (gross domestic product) since 1986.

“The tepidness of the supposed pump-priming is also apparent if the effects of inflation are taken into consideration. In real terms, total non-debt spending in 2009 is only an 8.6-percent increase from the year before,” he explained.

He further said that the tax relief, which refers to foregone revenues from reducing the corporate income tax to 30 percent from 35 percent, is actually already part of the reformed value-added tax law of 2005 and exemptions from withholding tax for those earning P200,000 or less annually.

The research group head also pointed out that the P100-billion infrastructure stimulus package required the Government Service and Insurance System, Development Bank of the Philippines and LandBank to commit P50 billion with the private sector shouldering the other P50 billion.

“All these imply that the administration is not really taking additional measures in the face of the crisis, and leaves the majority of poor Filipinos on their own,” Africa said.

“If it wants the public to believe that it is taking serious steps to address the crisis, it should at the very least preserve current jobs in the public and private sectors, restore real per capita social services spending to at least 1997 levels, free public resources by stopping debt payments, and remove the value-added tax on petroleum products, among others,” he opined.

The economic resiliency plan was announced by the National Economic and Development Authority (NEDA) early this year.

It is intended to upgrade infrastructure and capital stock and expand social protection. NEDA said the plan aims to save and create jobs, protect the poorest of the poor, returning overseas Filipino workers and workers in export industries, ensure low and stable prices to support consumer spending, and enhance competitiveness in preparation for the rebound of the global market.

Golez said the allocation of P330 billion for the economic stimulus package is intended to blunt the impact of the global economic meltdown on the poor and out-of-school youth.
–With Angelo S. Samonte(ManilaTimes)

200,000 Pinoys face layoffs But government looking to hire 60,500 in 2009

The National Economic and Development Authority (NEDA) on Friday predicted that between 40,000 and 200,000 Filipinos would be laid off from work this year because of the global economic crisis.

“That’s the range for the whole year, a big range. Definitely, it will raise the unemployment rate,” said Dennis Arroyo, the chief of the authority’s national planning and policy staff. He pointed out, though, that the unemployment rate would not reach 10 percent.

No massive job losses face those working in the government, however.

On the contrary, Budget Secretary Rolando Andaya Jr., said also on Friday, the government would hire a total of 60,500 state workers this year.

Arroyo said the expected adverse impact of the job losses in the private sector is already being addressed by the Department of Labor Employment by shifting overseas Filipino workers (OFWs) from host countries with weak demand to those with a strong one.

“The Middle East countries are responding to the crisis by pump-priming and spending on infrastructure projects,” he added. “That would [offset] OFW unemployment in construction. There are also new markets in Guam, New Zealand and Australia.”

Arroyo said he is optimistic that the 2009 gross domestic product (GDP) would not fall below the low-end target of 3.7 percent for 2009. GDP is the total value of goods and services produced in a country in a year.

Last year, the economy grew 4.6 percent from the previous year’s 7.2 percent.

“The crisis began in September and hit hard in October, November and December. Hence, the fourth quarter of 2008 was already in the crisis era. Yet, the economy still grew by 4.5 percent,” Arroyo said.

He added that the 2009 GDP target range of 3.7 percent to 4.7 percent assumed merchandise export growth of 1 percent to 3 percent. Arroyo said that in the fourth quarter of last year, export growth was at negative 9.2 percent.

“One would have expected the economy to post growth lower than 3.7 percent. But what happened was that manufacturing for the domestic market compensated for the drop in exports,” he added. Manufacturing growth accelerated to 3.2 percent in the fourth quarter of 2008, compared with 2.6 percent in the fourth quarter of 2007. It was buoyed by food manufacturing, beverage, chemicals and chemical products.

Winners and losers

Arroyo said that he expects fertilizer and fuel prices to go down, a possibility that would boost agriculture, forestry and fisheries, in particular.

Mining projects would be delayed because of “hesitance to invest” under the global crisis.

Manufacturing, according to Arroyo, would be dragged by exports but eventually would shift to the domestic economy. There also would be a big public-construction push, positive response from private construction, power-sector reforms and expansion of water-service areas.

The services sector, Arroyo said, would see lower fuel prices in 2009 than in 2008 that would spur the transport, communication and storage subsector.

“Lower inflation will boost retail trade but there will be an overhang of weaker consumer confidence because of the crisis,” he added. For the finance subsector, banks would be healthy but the stock market and insurance industry would still be weak.

Funds for mass hiring

In assuring job stability in the government sector, Budget Secretary Andaya pointed to “mass hiring” there and funds “for that purpose have already been earmarked in the 2009 national budget.”

“While the economic crunch had resulted in mass layoffs in the private sector, it is not true in the public sphere,” he said.

Andaya made the assurance in reaction to concerns aired by Courage, a public-sector union, that the rationalization plan of the government would displace a significant number of government workers.

Countering Courage, Andaya cited the budget of the Department of Education that alone allows for the hiring of 10,000 teachers and another 2,000 non-teaching personnel this year.

“This [recruitment] will bring the number of teaching and non-teaching personnel of the department to 506,000,” he said.

Andaya added that funds have been earmarked too for the hiring of 500 jail guards for the Bureau of Jail Management and Penology and the Bureau of Corrections.

Jobs in demand

Also, around 3,000 policemen will also be recruited this year to strengthen the Philippine National Police under the Department of the Interior and Local Government.

Andaya said that under the recently announced Nurses Assigned in Rural Areas (NARS) program, 5,000 nurses would be employed to serve in far-flung villages.

He added that around P2 billion in the 2009 budget has been allocated for the government reforestration program, which authorizes the hiring of 40,000 workers for the program and energy projects as well.

Besides the money given to the Education department, Andaya said that state colleges and universities had been authorized to hire additional academic personnel under their respective charters.

“All of these [jobs] are aimed at cushioning the effect of the global economic crunch on the private sector, which had no choice but to cut down the number of employees because of the financial slowdown,” he added.

The Budget secretary said that these government vacancies had been allocated funds. Earlier, Malacañang said it plans to order government agencies to set aside 1.5 percent of their maintenance and operating expenses, estimated to be at P7 billion, for the hiring of 180,000 casual employees for six months.

Andaya clarified that a plan to abolish redundant positions in the government had been advanced not only because of the cost of maintaining such but to improve service delivery by cutting red tape through systems and reorganization.

State employees affected by the rationalization will not include professionals, such as policemen, teachers, doctors, midwives and firemen, he said.

The implementation of the plan will be democratic, consultative and non-coercive, all part of creating a “smarter government,” Andaya added.
–Darwin G. Amojelar And Angelo S. Samonte(ManilaTimes)

Workers picket DOLE, SSS P12-B fund release, lay offs protested

By Marjorie Gorospe
INQUIRER.net
First Posted 12:21:00 02/11/2009

Filed Under: Protest

MANILA, Philippines – (UPDATE) Some 100 workers from the provinces of Cavite and Laguna picketed the Department of Labor and Employment Wednesday against the massive lay-offs, which employers have blamed on the global financial crisis.

Earlier in the day, a smaller number of protesters went to the Social Security System office in Quezon City to protest the decision of its president Romulo Neri to release P12.5 billion of SSS funds as aid to the government to ease the impact of the economic crunch.

Hermy Marasigan, spokesman of the Pagkakaisa ng Manggagawa sa Timog Katagalugan (United Workers of Southern Tagalog, Pamatnig-KMU), said that multinational companies in the region have been using the “financial crisis” as an excuse to fire their employees without due process.

Marasigan said there would be upcoming movements from the workers of Southern Tagalog against the unjust lay offs by these companies and the continuous corruption in government.

“This is a loss of job security for workers in the region,” Marasigan said in Filipino during the protest in DOLE.

Meanwhile, Joel Palacios, SSS spokesman, said that the protesters’ accusation was “speculative” since the release of the P12.5 billion has not yet been approved.

Palacio said certain criteria have to be met before the money could be released and used as potential investment.

“It is our duty to protect that [money] and make it grow,” Palacio added.

12,500 laid off at PEZA zones

By Joel Guinto
INQUIRER.net
First Posted 18:34:00 02/11/2009

Filed Under: Unemployment, World Financial Crisis

MANILA, Philippines — (UPDATE) Some 12,500 workers have been laid off at Philippine Economic Zone Authority (PEZA) zones since October, PEZA Director General Lilia de Lima said.

Some companies at the zones have shortened workweeks from seven days to six and workdays from three eight-hour shifts to two, De Lima said.

“They’re adapting shorter work hours so that they can hold on to their people, because it is difficult and costly to train” new personnel, she said.

On the other hand, the PEZA has approved applications of 560 companies to set up factories in PEZA zones, De Lima said.

“They’re now starting to create. They’re also starting to hire,” she said. “I want also to emphasize that some companies are also expanding: medical instrumentation, disposable syringes.”

Employment at PEZA zones was up 2.54 percent last year said.

Regarding US-based chipmaker Intel Corp., which announced last month that it would close down its Philippine plant and lay off the last thousand or so of its workers, De Lima said an Intel sister company, Numonyx, had hired 600 former Intel employees and would hire 400 more.(PDI)

Tala ng tanggalan

Jeffrey Ocampo

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Manggagawang Pilipino (KR Guda / PW File Photo)

LUBHANG nakababahala ang tantos ng malawakang tanggalan. Ulo ito ng balita sa telebisyon, radyo at mga pahayagan sa kasalukuyan. Mismong ang datos ng pamahalaan ang nagpapatunay sa tindi ng suliraning ito. Lubhang apektado nito ang mga manggagawa sa Calabarzon, Gitnang Luzon, Cebu at iba pang lugar sa bansa. Narito ang ilang tala ng tanggalan na kasalukuyang pinapasan ng obrerong Pilipino:

● Kompanyang Amerikano na nakabase sa California, ang Intel Corporation ay lumilikha ng mga semiconductor. Ang chip testing plant nito sa Cavite ay magtatanggal ng 1,800 na mga manggagawa. Pahayag ng pamunuan nito, “wala talagang demand [sa produkto].” Ang Texas Instruments naman sa Baguio Economic Zone Authority, isa sa pinakamalaking semiconductor manufacturer sa buong mundo, ay nagtangal ng 392 na manggagawa noong Disyembre. Mayroon pa itong “second wave” ngayong taon.

● Sa Fujitsu Ten sa Canlubang Laguna, 1,750 sa 5,000 na regular na mangagawa nito ay inaalok ng voluntary resignation. Ayon sa ulat ng mga manggagawa sa Pamantik, kung hindi bibigay ang mga manggagawa sa alok, magbabawas ang kompanya sa pamamagitan ng “performance evaluation.”

● Sa Zirtex, isang electronics company sa LTI, pinasakay umano ang humigit-kumulang na 200 kababaihang manggagawa sa shuttle ng kompanya at pinauwi dahil wala na raw silang trabaho. Ito ay ayon sa salaysay ng mga sinisante. Isa pang kompanya sa LTI na nagtanggal ng 800 na manggagawa noong Enero ang Hoya Glassdisk Philippines.

● Masaklap naman ang sinapit ng mga manggagawa ng Daiho Philippines na matapos makapagtayo ng unyon ay nagsumite ng papeles ang kumpanya hinggil na napipinto umano nitong pagsasara. Ayon sa Pamantik, magpapatupad ito ng limang araw lamang ng paggawa.

● Sa Sanyo Plastic Philippines, natanggal ang 32 na kontraktual na mga manggagawa ng wala man lamang notice.

● Ang Ebbara Benguet, isang steel fabrication company sa LTI, ay magbabawas ng oras ng paggawa. Nagdedeklara din umano ito ng “no work days” sa mga departamento nito. Nagkakaroon din umano ng rotation ng mga manggagawa.

● Ayon din sa ulat ni Sen. Villar, ang Woo Su at Phils Star sa Cavite EPZ ay nagsara na ang pagawaan noong Oktubre ng nakaraang taon dahil sa “insufficient orders” mula sa mga kliyente nito.

● Marami ring car and automotive parts manufacturing companies ang nagtanggal ng mga manggagawa. Liban sa Toyota Motors Philippines na nagpatupad ng “Monday-no-production day” noong Enero, nagbawas din ng mga manggagawa at oras ng paggawa ang Nissan, Keihin, Isuzu at Ford.

Pinabulaanan naman ng Ford ang naiulat na pagmamantina na lamang ng 18 manggagawa sa dating 400 na bilang.

● Ilang kumpanya rin sa Gitnang Luzon ang nagtanggal ng daang mga manggagawa nito. Sa Clark Freeport sa Pampangga, mayroong 629 na natanggal habang sa Subic Bay Free Port sa Zambalez, 1, 644 ang natanggal. Maging ang Luisita Industrial Park sa Tarlac ay nagtanggal ng 1,992 na mga manggagawa.

Marami pang ibang kompanya sa Gitnang Luzon ang nagtanggal ng mga manggagawa. Sa kabuuan, mayroon 18 kompanya sa rehiyon ang nagtanggal ng trabaho, ayon sa DOLE.
● Sa mga ulat, lumalabas na sa bilang na 18,000 na mga manggagawa na natanggal sa trabaho, mahigit 2,000 nito ay nanggaling sa mga pagawaan sa Cebu. Kabilang dito ang supplier ng automotive parts na Lear Automotive. Ang iba pang kompanyang nagtanggal ng mga manggagawa ay ang Maitland Smith Cebu Incorporated at Taiyo Yuden.  Sa pagitan naman ng kalagitnaan ng 2007 hanggang Disyembre 2008, natanggal ang 11,000 manggagawa sa kilalang industriya sa Cebu, ang furniture industry. Maging ang pagawaan ng Timex, sikat na brand ng relo, ay napabalita ding nagtanggal ng mga empleyado.

● Ang tinuturing na “sunshine industry” ng business process outsourcing (BPO) ay napapabalitang nagtatanggal na rin ng mga empleyado. Ang Accenture, ayon sa ulat ni Senador Manny Villar ay magpapatupad ng “redundancy program” na makakaapekto sa 500 empleyado. Ang Advanced Contact Solutions naman, ayon sa Eiler, ay ang naiulat na nagtanggal 900 na empleyado matapos mawalan ng mayor na Amerikanong kliyente. Ayon sa mga eksperto, aabot sa 90,000 na mga empleyado ng industriya ng BPO ang matatanggal sa trabaho kung magpapatuloy ang kasalukuyang sitwasyon.

● Ang Toledo Mining Corporation ay nagtanggal ng 600 na empleyado at contractors dahil umano sa mababang demand at presyo ng nikel sa pandaigdigang merkado.

●  Maging ang ahesiya ng pamahalaan, ang National Food Authority, ay nagtanggal din ng mga kawani nito. Bahagi ng “rationalization program” ng ahensiya, nagtanggal ito ng 1,242 na mga kawani na may “redundant position.” Nagtanggal naman ang Intramuros Administration ng 44 na mga empleyado.

● Bago umugong ang usapin ng tanggalan sa loob ng bansa, nauna nang napabalita ang tanggalan ng mga manggagawa sa mga pabrika sa Taiwan. Noong Disyembre, umabot ng 3,000 ang OFW sa bansang ito ang pinauwi sa Pilipinas. Samantala, ang bilang na ito ay aabot sa 6,000 sa Hunyo, ayon sa DOLE.(PinoyWeekly)

CBCP president backs calls for job summit

A top Catholic cleric called yesterday for an employment summit to tackle the reported massive layoff of workers in the economic zones.

Speaking over Catholic Church-run Radio Veritas, Archbishop of Jaro, Iloilo Angel Lagdameo, Catholic Bishops’ Conference of the Philippines president, said unemployment is a “serious problem” that the government must address.

“Well, it (unemployment) is a serious problem… that’s why the government must lead the discussion on how to help those Filipinos who will be losing their jobs (because of the global financial crisis),” he said.

“If the problem can be solved through a summit then they should push through with it…”

Earlier, Caloocan Bishop Deogracias Iniguez said the government must initiate the employment summit, especially now that the number of workers being displaced due to the global economic crisis continues to increase.

Iniguez, who heads the CBCP’s committee on public affairs, said although the government is implementing measures like employment facilitations and livelihood assistance to the workers, it is important that a summit between the government and the labor sector be held for the government to hear the workers’ side.

The Church is willing to help resolve the looming unemployment problem, he added.

Some multinational companies in the Philippines have closed down, while others have scaled back their operations in the country.

A labor official earlier predicted that about 250,000 workers nationwide are likely to lose their jobs in the next six months due to the global financial crisis.

The Department of Labor and Employment has reported that 30,000 workers have been displaced since December, and that the figure could reach 35,000 by month’s end.

Government won’t stop layoffs

Labor Secretary Marianito Roque ruled out yesterday the possibility of government imposing a “no retrenchment” policy.

“We are looking at measures to address the ill effects of the economic crisis, but we cannot enforce a no retrenchment policy because we cannot force employers from continuing with their operations if they do not have the capacity to do it,” he said.

Roque said the government has already granted a tax break for minimum wage earners and additional exemptions in their income tax returns for those receiving more than the minimum wage.

The Department of Trade and Industry is also reviewing the possibility of regulating the prices of rice and other essential commodities, he added.

Roque said concerned government agencies are discussing a proposal to suspend the implementation of the planned rationalization program.

“We are discussing if we could delay the rationalization program because of the economic crisis,” he said.

Meanwhile, Roque said commercial firms must adopt flexible working arrangements to cope with the financial crisis.

“Employers and workers should consider adopting such arrangements as a better alternative rather than outright termination of the workers’ services and total closure of their establishment,” he said.

Roque said flexible work schedules allow reduction of business costs while saving jobs and maintaining competitiveness and productivity in industries.

However, the adoption of the “compressed workweek” scheme should be voluntary and must have the consent of both employers and workers, he added.

Roque said the employer must notify the DOLE Regional Office in the workplace before adopting any flexible work arrangements.

DOLE Regional Offices are instructed to visit establishments wishing to adopt flexible work arrangements to validate whether it is in accordance with the DOLE advisory, he added.

Under the CWW scheme, normal workweek is reduced to less than six days but the total number of 48 work hours per week shall remain.

The normal workday is increased to more than eight hours but not to exceed 12 hours, without corresponding overtime premium.

However, implementation of reduced workdays must not exceed six months.

Meanwhile, Roque said he will set up “Help Desks” in the different regions nationwide to facilitate the delivery of assistance and services to displaced workers.

The help desks shall serve as a one-stop center bringing the delivery of DOLE programs and services closer to local and overseas Filipino workers who have been adversely affected by the global crisis, he added.

The Desks shall be comprised of personnel from OWWA, Philippine Overseas Employment Administration, Bureau of Local Employment, and Technical Education and Skills Development Authority.

The DOLE Regional Directors shall oversee the operations of the help desks.

On the other hand, Roque called for a united response to the effects of the financial crisis on employment.

Speaking before the participants of the Multi-Sectoral Conference on the Global Financial Crisis, Roque said, a united effort is essential to effectively mitigate the impact of global financial crisis.

“Assistance and intervention for some 33,000 affected workers who have begun to experience shorter working hours, along with the more than 40,000 workers displaced by the global economic crisis are urgent,” he said. – Helen Flores, Mayen Jaymalin(PhilStar)

1,900 Cordillera workers displaced by financial crisis

Retrenched workers properly compensated, DoLE says

By DEXTER A. SEE

BAGUIO CITY – At least 1,900 workers at different companies in the Cordillera comprised the first batch of employees displaced by the global financial crisis, it was reported.

But despite this bleak development, lawyer Ana Dione, regional director of the Department of Labor and Employment (DoLE) in the Cordillera, said the region is in a good position to face the crisis because the mass layoff taking place in other regions is not happening in companies in the economic zone here.

While the Texas Instruments Philippines (TIP) retrenched over 500 workers last year and bared plans to lay off another batch of workers this year, Dione said the future is still bright for the TIP as it has already started to operate even on a medium level.

She said this is an indication that orders for electronic chips are still being placed with the firm.

Furthermore, Philippine Economic Zone Authority (PEZA) officials informed DoLE that they expect investors to consider Baguio City as one of the areas where they can invest even with the global financial crisis.

The PEZA officials noted the increase in business process out-sourcing operations in the city.

Out of the 1,900 affected workers in the region, 1,376 are partially displaced as they are still holding on to their jobs but on a rotation or reduced-time scheme, which is authorized by the labor department to prevent mass layoff.

The other affected workers are considered totally displaced because they are no longer connected to the companies which had earlier employed them.

Dione said several industries in the region which were the initial victims of the global crisis included manufacturing, service, electronics, and mining.

Nevertheless, she said, DoLE made sure that the retrenched workers were properly compensated by their employers.

What is significant, Dione said, is that the labor sector is now inquiring from DoLE about the programs and projects of the national government for the development of skills or livelihood that would enable the workers to augment their meager income.

A concrete example cited by the Cordillera DoLE official is the labor union of the Lepanto Consolidated Mining Co. which had requested the labor department to re-train the mine workers on skills that could be used to generate income or livelihood.

The labor official said DoLE is providing emergency employment assistance as well as training to workers in the region who are interested in developing skills and knowledge that could make them productive amidst the global financial crisis.(MB)

P12B SSS ‘stimulus package’ probed

SEN. Panfilo Lacson yesterday filed Senate Resolution 850 directing the committee on government corporations and public enterprises to investigate the plan to channel P12.5 billion in Social Security System funds for the government’s “economic resiliency plan.”
“To use the hard-earned money of its members to finance the government’s programs for the poor as well as to help private companies tide over the consequences of the financial crisis is nothing more but a slap in the faces of the 27 million SSS members who are being cheated of what is rightfully theirs,” Lacson said.

Lacson also voiced suspicions that the P12 billion may eventually find its way to administration coffers for the 2010 elections.

Lacson said the SSS’ main function as decreed by its charter is to extend social security protection to workers and their beneficiaries.

SSS president Romulo Neri had said the pension fund will “contribute” P12.5 billion to the P330-billion economic stimulus fund of the Arroyo administration.

Neri said the SSS funds may be allocated to products with sovereign guarantee as provided in its charter.

Lacson reminded Neri that the SSS administration’s “first and foremost” duty is to protect the interest and welfare of its members, who in the first place are the source of its funds.

Lacson noted that Neri’s predecessor, Corazon dela Paz, had urged all SSS members to be vigilant against groups and individuals who may want to use their pension funds especially “for an agenda not legally allowed under the SSS Charter.”

Assistant House minority leader Rep. Liza Maza said Neri is gambling away the hard-earned money of the SSS members in committing P12.5 billion of its reserve funds.

“If indeed Neri thinks the P12.5 billion SSS funds is good investment, he should subject his decision to a vote among SSS members. The fund is from the private workers’ pockets and they have all the right to decide what should be done with their funds,” she said.

Maza said Neri has no credibility in assuring the SSS members that the investment would redound to more benefits for them.

“With Neri’s role in the anomalies behind the ZTE-NBN deal, his moral authority to give such commitments and pronouncements is very questionable,” she said.

Malacañang said it has not yet set up the P100 billion public-private sector infrastructure fund component of the P330 billion economic stimulus package.

The stimulus program was supposed to be implemented in the first half of the year.

Outgoing Press Secretary Jesus Dureza said the Cabinet is just finishing the details on how to implement the P100 billion infrastructure fund with the Philippine Chamber of Commerce and Industry and how to get it going.

House majority leader Arthur Defensor (Iloilo) lashed at critics of the economic stimulus package saying they are using the issue as a political vehicle.

Defensor stressed the economic stimulus is ‘badly needed’ by the country to ride out the adverse effects of the global financial meltdown. – Regina Bengco, Wendell Vigilia and Peter J. G. Tabingo(Malaya)

Unemployed seen rising to 11M

BY REGINA BENGCO

THERE were 10.7 million unemployed and underemployed Filipinos last year, the research group IBON Foundation said yesterday.

The number is likely to increase to at least 11 million based on the assumption that the labor force increases by 915,000 every year and that only 500,000 jobs are created. This means the number of jobless Filipinos increases by 415,000 yearly, IBON said.

The group said the figure could be higher as the employment situation is already “far worse” than the aftermath of the 1997 Asian financial crisis when unemployment rate averaged 10 percent in 1998-1999 compared to nearly 11 percent in 2008.

It said the Philippines’ condition could be likened to the global slowdown in 2000, which was also caused by US financial and economic troubles, when unemployment rose to 3.7 million in 2001.

“There is strong reason to believe that the Philippine economy will again go in these directions or even worse, as the current global economic financial turmoil is not just deeper and farther-reaching but will also last for much longer,” it said.

IBON said job creation under the Arroyo administration since 2001 has been “tepid” and its policies have not been able to create enough jobs for Filipinos.

It recommended “radical change” in the government’s economic policies such as increasing public spending for social services, removing the value-added tax on oil products, and freeing public resources by stopping debt payments.

Press Secretary Jesus Dureza said the Cabinet is looking at a better response to job losses of some Filipino workers because of the global recession. He said President Arroyo will look at other job opportunities for displaced overseas Filipino workers (OFWs) when she goes to Switzerland, Italy and Bahrain at the end of the month.

Dureza said proposals such as giving emergency allowance to displaced workers has been the subject of further discussions by government’s economic managers.

“We always say that we can never tell what is going to happen in the future but we have been strengthening ourselves, preparing for any eventuality,” he said.

Agriculture Secretary Arthur Yap said his department will implement at least 3,500 projects to create around some 130,000 jobs.

Among these projects are goat raising and dispersing, construction of farm-to-market roads, rehabilitation of irrigation systems, and production of organic fertilizers.

The projects are yet to be finalized in July. No time-frame has been set for implementation. — With Angela Lopez de Leon(Malaya)

IBON: RP Effectively Enters Recession

Written by IBON Media

Friday, 16 January 2009

Even as the administration continues to deny that the global economic turmoil will push the country into a deeper crisis, independent think-tank IBON Foundation today said that the Philippines has effectively started to enter a recession. Speaking at the IBON Birdtalk yearend briefing, IBON research head Sonny Africa said that the economic growth in 2008 has already fallen by nearly three percentage points, and adverse trends in joblessness, falling real incomes, and worsening poverty will deepen this year. “To indicate a recession in the Philippines, two consecutive quarters of decline or negative growth in real gross domestic product do not have to happen,” Africa explained. “This rule of thumb is particularly inapplicable in the Philippines given its chronic crisis and where even positive growth rates can be accompanied by high and rising unemployment, falling incomes, increasing poverty and deteriorating welfare.” It is expected that GDP growth in 2009 will be half or even less than in 2007 which would be the slowest since at least 2001. While government projects optimistically high rates, these are still adjusted downwards virtually every time new figures are released. The sluggish growth in the coming period will likely see the country returning to the low growth path of the 1990s. There are also alarming trends when looking at national income from the expenditure side, said Africa. Growth in personal consumption expenditure in the first three quarters of 2008 of 4.6% is a steep drop from the same period in the year and threatens to make the full year figure the lowest since 2002. The consumption slowdown is worrisome for an economy with such a large population that, for lack of incomes, is already underconsuming as it is, he said. Government consumption expenditure slowed even more drastically to 4 % as it grapples with its unresolved fiscal crisis and belying claims that it is pump-priming the economy. The marked slowdown in investments in fixed capital formation, to 4.4% in the first three quarters of 2008 from 13.5% in 2007, is also ominous in foreshadowing deteriorating productive capacity in the period to come, he said. This expenditure item covers durable equipment and construction. There was also a notable drop in exports growth from to 2.4% in the first three quarters of 2008 from 6.1% in 2007 – reflecting just the global slowdown since the start of the year and not yet even the sharp turn for the worse after September 2008. Growth in total merchandise exports was just 0.4% with negative growth and outright contractions in the most significant export items: semiconductors fell 3.8%, finished electrical machinery fell 23.2%, and garments fell 4.9 percent. These are the signs of a frail Philippine economy poorly equipped to deal with crisis: a narrowing productive base for generating jobs and incomes, weakening ability to consume and even invest, limited political will to substantially pump-prime, and undue dependence on exports and remittances, said Africa. “The risk is real that the downturn that started to worsen in the last half of 2008 is the beginning of another long period of stagnation and recession,” he said. (end)

Gov’t Urged To Take More Active Steps To Address Job Losses, Economic Slowdown

Written by IBON Media

Monday, 12 January 2009

‘Contingency Package’ Insufficient Amid Crisis The government has yet to take real steps to address the adverse effects of the global crisis on the local economy, said research group IBON Foundation. In an attempt to downplay the economy’s problems and insist on imaginary “sound fundamentals”, the administration calls its efforts a mere “resiliency” or “contingency” plan. However, this eventual package is inadequate, places the burden of adjusting to the crisis on the people, and borders on mere public relations gimmickry, said IBON research head Sonny Africa. So far, the administration has not really introduced new and additional measures, and has merely engaged in ineffectual exercises to give the impression that something is being done, he said. The labor department has allegedly prepared “alternative” livelihood programs and loans for retrenched workers and displaced overseas Filipino workers (OFWs). However, if the administration is really capable of creating domestic jobs and livelihood to begin with, then this is something that should have been done for the over 4 million jobless Filipinos even before the recent descent into crisis, said Africa. At best, the administration has showcased pockets of success, even as these efforts do not reach the majority. For example, an additional P5 billion was allocated for the Pantawid Pamilya Pilipino program, which will double the number of beneficiaries from 320,000 households to 640,000 households. However, the 2006 FIES show that 8.7 million families or the poorest half of the country’s families have incomes of less than P8,300 per month. The program thus reaches less than 4% of just these families even assuming, given the weaknesses of the government bureaucracy such as corruption, that the money will even reach them. The administration’s continuing denial of the economy’s deep-seated problems contributes to its inability to deal with the crisis, said Africa. As it is, the poor are being left on their own to deal with their long-standing problems. But it is possible to immediately arrest the slowdown in economic activity and mitigate the worsening of joblessness, incomes and poverty by taking more active measures to care for people’s welfare. Some of these measures include giving sufficient attention to health, education, social welfare and emergency support, and taking substantial steps to develop the domestic economy and make it less vulnerable to external shocks in the future, he said. (end)

Filipinos Seen To Pay More Taxes In 2009

Written by IBON Media

As government fails to resolve its fiscal crisis in 2008 and faces a severe deficit problem, the prospect of more burdensome taxes and shrunken social services looms in 2009, says research group IBON Foundation. The Philippine government, like last year, will scramble to raise revenues in the quickest way possible. This deficit scenario has nothing to do with the global crisis and is due to the government’s poor revenue performance and distorted spending priorities. Increasing the tax burden on the people is crucial for the Arroyo government. Last year, oil price increases have resulted in a de facto new tax burden of over P19 billion– or the oil price-induced “windfall” gain in tax revenues– bringing RVAT take on oil up to around P80 billion for the whole year. This year, the administration is aiming to put an additional tax burden of P12-25 billion through a uniform excise tax on tobacco and alcohol products, or the so-called sin taxes. It is also possible that the “rationalization” of fiscal incentives, by restricting tax- and duty-free incentives to exporters and big-ticket investors, will effectively add to the tax burden of domestically-oriented Filipino small and medium enterprises (SMEs). In 2008, the administration has failed to improve revenue collection, where total revenue growth of 8.1% in the January-August 2008 period has been even slower than nominal year-on-year growth in gross national product (GNP) of 12.5% in the first semester. This is far short of the 13.5% rate, without privatization, targeted for 2008. It is also not far from the 8.2% average annual revenue growth rate in the pre-VAT period 2000-2004. This implies that there has been virtually no improvement in revenue efficiency and that increased revenues have been due largely to the imposition of the regressive VAT and one-shot privatization. The government is not addressing the most important sources of deficit pressures (i.e. revenues undermined by corruption and liberalization, unproductive debt service, etc.) and stubbornly continues to target a balanced budget at the expense of heavier burden for the Filipino majority. (end)

Just Say “No” to the Credit Rating Agencies

What is most insidious about the credit agency warnings is the “fallacy of composition” follies it provokes. If collectively countries and investors follow their advice and governments – especially in the largest countries – fail to engage in large enough fiscal expansions – then the prospects for widespread payment problems of sovereign debt surely will occur.

BY GERALD EPSTEIN
Truthout/Perspective
INTERNATIONAL
Posted by(Bulatlat.com)

The credit rating agencies have got us, coming and going. First they help cause the biggest economic calamity since the 1930’s. And now they tell us we can’t take the fiscal measures needed to get us out of this mess. Meanwhile, they are laughing all the way to the bank (that is, if they can find one that is still solvent). Why are we still listening to them?

The role played by the big credit rating agencies – such as Standard & Poor’s and Fitch – in the unfolding financial crisis is now well-known. By giving complex, opaque and ultimately toxic mortgage-backed securities high ratings and therefore, their own ringing stamp of approval, the credit agencies enabled banks to market these destructive securities around the world. We are now all paying the price.

Now, to prevent this very same crisis from turning into a full-blown catastrophe 1930’s-style, governments around the world – from Obama to Brown to Merkel and beyond – are finally beginning to do the right thing: they are planning major fiscal spending operations to place a floor on the terrifying downward economic spiral and to begin to turn the world economy toward recovery. Even the austerity-loving IMF is strongly supporting these initiatives.

Yet now, Standard & Poor’s and Fitch are sending “credit warnings” to other governments, threatening to downgrade their sovereign debt ratings if they “allow” their fiscal deficits to increase too much. Wednesday, Standard & Poor’s downgraded Greece’s sovereign credit rating. Explaining the downgrade, Marko Mrsnik, S&P analyst, said: “The global financial and economic crisis has, in our opinion, exacerbated an underlying loss of competitiveness in the Greek economy.” (Financial Times, January 14, 2009). And in recent days, three other eurozone countries – Portugal, Ireland and Spain – have been warned by Standard & Poor’s to “fix” their public finances or face downgrades. Under the current system, such downgrades would increase the cost of raising funds and be taken as a signal to investors to shy away from these investments.

Most significantly, these public warnings fire a shot across the bow of larger countries – such as Germany, the UK and France – that they had better not go too far down the road of fiscal expansion, or they might face a similar fate.

Yet, increasing spending and fiscal deficits in the short run is exactly what these governments should be doing. And now, after helping to cause the crisis, the credit rating agencies are blocking the way to the solution. The actions by Standard & Poor’s are therefore profoundly misguided and potentially destructive.

For starters, the implicit model used by these agencies is fundamentally flawed – especially in this crisis context. As even the IMF, financial market economists, and usual deficit hawks such as Larry Summers now recognize, as the world’s economies spiral downwards, fiscal deficits will automatically grow as tax revenues fall and spending on social safety nets increases. This will occur with no increases in discretionary counter-cyclical fiscal policy at all. Such depression-level deterioration surely will put pressure on countries’ abilities to service their debts and even risk widespread defaults or debt rescheduling. The only way, then, to improve countries’ ability and willingness to service debt in the medium term is to engage in massive fiscal expansions in the short term. But the credit rating agency models do not reflect this truth.

This is true on a country by country case. What is most insidious about the credit agency warnings is the “fallacy of composition” follies it provokes. If collectively countries and investors follow their advice and governments – especially in the largest countries – fail to engage in large enough fiscal expansions – then the prospects for widespread payment problems of sovereign debt surely will occur. A widespread heeding of Standard & Poor’s information will almost certainly lead to massive losses for investors.

So what is to be done?

In the short run, prominent policymakers in national as well as international forums should collectively discredit the credit rating agencies. The IMF, the BIS, the European Union and business leaders around the world should denounce this wrong and destructive advice. Second, the rules governing pension funds and other investment funds should be immediately changed – at least for the duration of the crisis – to allow them to discount the weight they give to the agencies’ ratings of sovereign debt. In the medium term, substitutes must be found for these agencies’ ratings, which by now should have lost all credibility. The creation of a global nonprofit agency, funded with an endowment to protect its political independence, yet one that is transparent and broadly open to scrutiny – should be strongly considered.

Finally, and of fundamental importance, efforts to take more internationally coordinated action to achieve massive fiscal stimulus – supported by central banks – must be taken immediately. This credit ratings fiasco – which picks off the weakest countries one by one and sends warnings to the stronger ones – an anti-Keynesian divide-and-conquer strategy – could not occur if governments coordinated and unified their actions to turn this crisis around.

Gerald Epstein is Professor of Economics and co-director of the Political Economy Research Institute (PERI) at the University of Massachusetts, Amherst, and Visiting Scholar, Université, Paris NORD (Paris XIII). gepstein@econs.umass.e(Bulatlat)

Philippines Effectively Enters Recession

Even as the administration continues to deny that the global economic turmoil will push the country into a deeper crisis, the Philippines has effectively started to enter a recession.

BY IBON FOUNDATION
Posted by Bulatlat

Even as the administration continues to deny that the global economic turmoil will push the country into a deeper crisis, the Philippines has effectively started to enter a recession.

Speaking at the IBON Birdtalk yearend briefing, IBON research head Sonny Africa said that the economic growth in 2008 has already fallen by nearly three percentage points, and adverse trends in joblessness, falling real incomes, and worsening poverty will deepen this year.

“To indicate a recession in the Philippines, two consecutive quarters of decline or negative growth in real gross domestic product do not have to happen,” Africa explained. “This rule of thumb is particularly inapplicable in the Philippines given its chronic crisis and where even positive growth rates can be accompanied by high and rising unemployment, falling incomes, increasing poverty and deteriorating welfare.”

It is expected that GDP growth in 2009 will be half or even less than in 2007 which would be the slowest since at least 2001. While government projects optimistically high rates, these are still adjusted downwards virtually every time new figures are released. The sluggish growth in the coming period will likely see the country returning to the low growth path of the 1990s.

There are also alarming trends when looking at national income from the expenditure side, said Africa. Growth in personal consumption expenditure in the first three quarters of 2008 of 4.6 percent is a steep drop from the same period in the year and threatens to make the full year figure the lowest since 2002. The consumption slowdown is worrisome for an economy with such a large population that, for lack of incomes, is already under-consuming as it is. Government consumption expenditure slowed even more drastically to 4 percent as it grapples with its unresolved fiscal crisis and belying claims that it is pump-priming the economy.

The marked slowdown in investments in fixed capital formation, to 4.4 percent in the first three quarters of 2008 from 13.5 percent in 2007, is also ominous in foreshadowing deteriorating productive capacity in the period to come, he said. This expenditure item covers durable equipment and construction. There was also a notable drop in exports growth from to 2.4 percent in the first three quarters of 2008 from 6.1 percent in 2007 – reflecting just the global slowdown since the start of the year and not yet even the sharp turn for the worse after September 2008. Growth in total merchandise exports was just 0.4 percent with negative growth and outright contractions in the most significant export items: semiconductors fell 3.8 percent, finished electrical machinery fell 23.2 percent, and garments fell 4.9 percent.

These are the signs of a frail Philippine economy poorly equipped to deal with crisis: a narrowing productive base for generating jobs and incomes, weakening ability to consume and even invest, limited political will to substantially pump-prime, and undue dependence on exports and remittances, said Africa. “The risk is real that the downturn that started to worsen in the last half of 2008 is the beginning of another long period of stagnation and recession,” he said. Posted by Bulatlat.com

Hunger stalks remote Samar villages

By Joey A. Gabieta
Philippine Daily Inquirer
First Posted 01:54:00 01/18/2009

Filed Under: Poverty, Food

TACLOBAN CITY, Philipines—Hunger now stalks over 7,000 residents of two island-barangays of Guiuan, Eastern Samar as food supplies could no longer reach them due to continuous rains and strong winds.

The historic island of Homonhon and of Suluan Island has become isolated as travel to the town proper for food has become impossible because of the bad weather, according to Guiuan Mayor Annaliz Kwan.

“I really feel hopeless. I want to help our people there but could not do anything except to pray for the weather condition to improve so we can deliver food to our people there who have been suffering for a week now,” Kwan said in a telephone interview Saturday.

Suluan and Homonhon are the farthest island-barangays of Guiuan, located within the Pacific Ocean area with a combined population of more than 7,000.

The town mayor said that sailing to the two island barangays (villages) under the prevailing weather condition would be extremely risky. “The waves there are so high which is very dangerous for ordinary or small pump boats to travel,” she said.

She said the only way to deliver food to the two islands would be by air but the town has no means to do it.

PDIC to take over 2 rural banks

CITY OF SAN FERNANDO — The Bangko Sentral ng Pilipinas (BSP) on Thursday placed Rural Bank of Sta. Rita (RBSR) and Rural Bank of Bacolor (RBBR) under the receivership of the Philippine Deposit Insurance Corporation (PDIC).

Receivership “is a form of bankruptcy in which a company can avoid liquidation by reorganizing with the help of court-appointed trustee.”

Arroyo Watch: Sun.Star blog on President Arroyo

The move came as an effect of the self-imposed bank holiday of the two banks before Christmas last year that sent worried clients calling on the BSP to intervene.

“The receivership enables the PDIC to take over the banks’ assets to protect the interest of bank depositors and to start processing deposit insurance claims,” the BSP said in a statement.

The BSP assured that despite the condition of the two banks “the rural banking sector in Pampanga remains strong and healthy.”

“There are now 20 remaining Pampanga-based rural banks with a combined asset base of more than P8 billion, deposit base of more than P6 billion, and close to P1.5 billion in capital accounts,” the BSP revealed.

As a whole, these rural banks have consistently recorded healthy double-digit growth rates in deposits received and loans granted between December 2007 and September 2008 according to the BSP.

The BSP explained that the capital adequacy ratio (CAR) of the present 20 Pampanga-based rural banks is 19.9 percent, nearly double the 10-percent minimum required by the BSP. The said figure is also more than twice the international standard of eight percent. CAR or the ratio of a bank’s capital to its risk reflects a bank’s ability to absorb losses.

“The Bangko Sentral advises the public to avoid making sweeping judgment on the condition of individual banks or to pass on baseless rumors,” the BSP stressed.

Depositors of RSBR and RBBR may call the PDIC’s Deposit Assistance Group at 841-4630 for their deposit-insurance claims. (IOF)

Can Philippine Economy Withstand Crisis in 2009?

By IBON Foundation

IBON Features— The global economic situation is expected to continue deteriorating until 2010 and even beyond, and the Philippines is going to be severely affected by the worsening crisis. Yet it is still possible to mitigate the effects on the country, and more importantly, to emerge from this period of crisis with a genuinely strengthening and forward-moving economy.

Various factors will come into fuller play by next year and action must be taken as soon as possible. The economy has been deteriorating steadily in recent years despite government hype and, as it is, growth has been slowing since the start of the year. The onset of global financial and economic turmoil however now pushes it into a deeper crisis that it is poorly equipped to deal with.

Economic distress

The slowdown that begun in 2008 and will carry through until next year is clear. Growth this year and next year could easily turn out the slowest in a decade. Joblessness will increase and add to the 4.1 million unemployed – estimated to include the jobless statistically removed from the labor force to lower officially reported figures – and 6.8 million underemployed as of 2007. The number of jobless and underemployed next year will very likely rise to well over 11-12 million.

Retrenchments and closures will be most immediately felt in the goods and services export sectors. Particularly affected will be the major sub sectors of electronics (67% of exports in 2007), apparel and clothing (5%), and furniture and woodcrafts (2%). The US in particular is the largest buyer of Philippine garments and furniture and receives 80% of total garments exports and 60% of total furniture exports. The crisis will weaken global demand for laptops, cameras and cellular phones which are the primary users of the semi-conductors and microprocessors that the country exports. As it is, the country’s export-oriented electronics sub sector employs some 500,000-600,000 workers. The US is also the world’s largest end-consumer of electronics.

The business process outsourcing (BPO) industry will also likely be badly affected with the US accounting for over two-thirds of foreign equity and 90% of BPO export revenue. The grand target of 940,000 BPO jobs by 2010 is even more impossible especially with employment at most at just 320,000 now. Similarly with local tourism and business travel outfits where hotels and restaurants will feel the pinch of less foreign and domestic visitors.

The jobs situation has clearly started to worsen in 2008. The number of jobless Filipinos drastically increased by 279,000 in October from the same period last year and increased the unemployment rate by 0.6 percentage points. Rough approximations correcting for the government’s recent maneuver of underestimating unemployment place the number of jobless Filipinos at around 4.3 million and the unemployment rate at over 11 percent.

The important manufacturing sector lost another 159,000 jobs from the year before, the transport, storage and communication sector lost 10,000 jobs, and financial intermediation lost 4,000 jobs. These trends are likely to continue until next year and be aggravated by deteriorating jobs in construction, finance and wholesale and retail trade. Small and medium enterprises in particular will have a harder time borrowing with creditors preferring perceived “safer” large borrowers.

Filipinos working overseas in distressed countries and sectors face layoffs or at least lower incomes. This is not just in the US where the crisis first erupted but also wherever in the world they might be and no country is untouched by the tumult. The US is notable though in that over half of all remittances– reaching 52% or US$7.6 B of US$14.5 B in 2007– come from the US or via US-based banks.

Overseas Filipinos will do their best and be making even greater sacrifices to maintain remittances to their families in the country. But remittance flows are still certain to weaken in 2009 and perhaps even significantly. At the very least there will be a slowdown in deployments to the US, Europe, Middle East, East Asia and seaborne work where the overwhelming number of overseas Filipinos go and a corresponding drop in growth of remittances from abroad. The corresponding drop in household incomes will have repercussions on domestic sales of consumer goods and services and even of residential real estate.

The job losses and squeeze on wages, benefits and remittances will combine with rising prices and have an immediate impact on household incomes that will cause poverty to rise. But the spending will also have further depressing effects – possibly beginning with domestic wholesale, retailing and food services as stores and restaurants face lower consumer spending. Additional pressure comes from the generalized slowdown due to overall economic uncertainty, lower consumption, tighter credit and depressed investments. The poorer business sentiment and tightening of capital flows is already reflected in steep stock market drops and much higher interest rates.

External financing for the country is dropping steeply. The US$912 million net outflow of foreign portfolio investments in the January-October 2008 period is a drastic reversal from the US$3.7 billion inflow in the same period last year. Net FDI is going in the same direction and fell by more than half to US$1.1 billion in January-August 2008 from US$2.5 billion in the same period in 2007. There is also a strong possibility that the rate at which official development assistance (ODA) is declining will worsen in the coming years as donor governments prioritize domestic financing needs. As it is ODA has already fallen 30% to US$9.2 billion last year from US$13.2 billion in 2001.

Immediate relief and strengthening the economy

There are two stages in coping with the crisis. The first stage is to arrest the slowdown in economic activity and the corresponding worsening in unemployment, incomes and poverty. This is critical especially since the country has already been suffering record unemployment, falling incomes and rising poverty in the last few years.

The effects of the economic downturn must be countered by stimulating the economy through expansionary and, importantly, equity-building policies. This includes:

1. Providing immediate emergency food, income and work relief.
2. Increasing public spending on health care, basic education and housing for the people and restoring real per capita social services spending to at least 1997 levels.
3. Increasing public spending on labor-intensive and rural infrastructure projects that will directly improve people’s livelihoods.
4. Public resources can be freed by:
· Suspending debt payments. This can begin with, but not be restricted to, debt to foreign creditors receiving bail-outs from their governments.
· Drastically reducing military spending.
· Cracking down on corruption. This is especially critical to prevent leakages into politicians’ electoral war chests for 2010.
5. Giving priority to Filipino producers in government procurement and aid-funded projects.
6. Implementing a P125 across the board nationwide wage hike and a PhP3,000 increase in government salaries.
7. Removing the VAT on oil products and increasing taxation of wealth, luxury goods and services, and on unproductive assets and transactions.
8. Reducing interest rates while ensuring that credit remains available.

There is also a need to immediately stabilize capital flows with capital controls, especially against outflows right now, and supporting the exchange rate. Capital controls must be used to defend against speculative attacks or financial transactions not related to trade and production.

The advanced capitalist countries are pushed to become all the more aggressive in pushing to open up neo-colonial countries as vents for their crisis. There are two particular areas of concern. The first is how the International Monetary Fund (IMF), World Bank and other creditors will exploit the situation to leverage further policy conditionalities through their loans and aid. The second is how free trade agreements (FTAs) will be packaged as solutions for slowing domestic economies. This includes not just FTAs between vastly unequal parties but also those packaged as intra-Third World deals that merely create regional production lines for the benefit of the big powers. All maneuvering such as these must be vigorously opposed.
The second stage involves laying the foundations for economic development and reducing internal and external vulnerabilities to inevitable crises.

The economy’s problems are far beyond piecemeal solutions. A radical change in socioeconomic policies is needed if there is going to be any hope of lifting the tens of millions of poor Filipinos out of their deprivation. This much is clear from the Philippine’s poor development experience and chronic poverty over the last six decades: the stubbornly elite-biased and increasingly “free market”-oriented policies are a development dead-end. Alternative socioeconomic policies must be geared towards what is strategically necessary to improve the economy and people’s welfare. In the concrete economic and political conditions of Philippine society today this can only mean genuine agrarian reform and national industrialization.

(IBON)

GLOBAL NEWS: Thousands in Lebanon, Turkey protest Israel attack

BEIRUT (AP) – Thousands protesting Israel’s ground offensive on Gaza converged yesterday in Beirut and the Turkish capital, as the leaders of the only two Mideast Arab nations to sign peace treaties with Israel demanded an end to the attack.

In Yemen, security officials said anti-Israel protesters attacked several Jewish homes in the northern province of Omran, smashing windows and pelting them with rocks. The officials, speaking on condition of anonymity because because they were not authorized to talk to the media, said at least one Jewish resident was injured among the tiny minority community.

Lebanese police used water hoses to try to push about 250 demonstrators away from the US Embassy in Lebanon’s capital. When that failed, they fired tear gas, said Lebanese security officials. A second Beirut protest — a sit-in outside the UN building — drew thousands of supporters of Hamas and Lebanon’s Islamic Group.

In Turkey, more than 5,000 people held an anti-Israel rally in Istanbul, waving Palestinian flags and burning effigies of Israeli Prime Minister Ehud Olmert and President George W. Bush. Also in Istanbul, club-wielding police broke up a small demonstration by protesters who hurled eggs at the Israeli Consulate, the private Dogan news agency reported. There were no reports of arrests or injuries.

Israel’s weeklong aerial bombardment of Gaza and the start of the ground offensive Saturday against Hamas have drawn condemnation across the Muslim and Arab world and news coverage of the invasion has dominated Arab satellite television stations.

Thousands in cities from Tehran to Damascus have also taken to the streets to protest the attacks, which have killed about 500 Palestinians and wounded more than 1,600, according to Gaza officials.

In some cases, the protests of the past week were as directed against Arab governments as much as Israel, with many criticizing their perceived inaction or lack of sufficient support of the Palestinians.

Yesterday, the leaders of Egypt and Jordan — the only two Mideast Arab countries to sign a peace agreement with Israel and maintain diplomatic ties — condemned the ground offensive and called for an end to Israel’s onslaught in Gaza.

Several hundred Jordanians shouting “death to Israel” protested against the Gaza offensive yesterday in two separate demonstrations in central Amman, the Jordanian capital. The protests were peaceful and police made no arrests.

In parliament meanwhile, the Jordanian government came under criticism from Islamic opposition lawmakers demanding that it suspend relations with Israel.

“All options are available to assess the relationship with every side, especially Israel,” Prime Minister Nader al-Dahabi told parliament during a heated debate.

“We will reconsider relations according to our higher national interests,” he said. “We will not remain silent about the situation and the serious deterioration in Gaza and neither about the threat which risks the security of the whole area and its stability.”

Palestinian President Mahmoud Abbas, who runs his own Palestinian administration from the West Bank, also denounced Israel’s ground offensive as “brutal aggression” in his harshest words yet in describing Israel’s assault on his Hamas rivals.

Israel says the aim of the operation is to stop the Palestinian militant Hamas group from firing rockets at southern Israeli towns. Hamas is opposed to any peace settlement with Israel and calls for the destruction of the Jewish state.

“This battle will end a (peace) settlement forever,” Hamas’ representative in Lebanon, Osama Hamdan, told the protesters at the sit-in. “This battle will show who are the men.”

Five civilians and one policeman were lightly injured in the clash outside the US Embassy earlier in the day, according to the Lebanese officials, who spoke on condition of anonymity because they were not authorized to speak to the media.

Meanwhile, the leader of Lebanon’s militant Hezbollah group, Sheik Hassan Nasrallah, discussed the situation in Gaza with visiting chief Iranian nuclear negotiator Saeed Jalili, the group’s Al-Manar TV said.

Al-Manar did not give further details but said Nasrallah and Jalili, who arrived here Saturday from neighboring Syria, discussed “ways of ending this aggression.”

Hezbollah, which is a strong ally of Hamas, possesses a formidable arsenal of rockets and missiles that bloodied Israel during a monthlong war in 2006. Hezbollah has not threatened to join Hamas in its current battle with Israel, but Nasrallah said last week that his men are on alert in case Israel attacks Lebanon.(PhilStar)

GLOBAL NEWS: Gaza civilians left exposed in Israeli invasion

GAZA CITY (AP) – With booms from artillery and airstrikes keeping them awake, the 10 members of Lubna Karam’s family spent the night huddled in the hallway of their Gaza City home.

Earlier strikes shattered the living room windows, letting cold air pour in. The Karams haven’t had electricity for a week and have run out of cooking gas. The family, including three small children younger than four, eats cold, canned beans.

“It’s war food,” said Karam, 28. “What else can we do?”

As Israel’s offensive against Hamas moves from pinpointed airstrikes to ground fighting and artillery shelling, Gaza’s civilians are increasingly exposed. Some two dozen civilians were killed within hours after the start of Israel’s ground invasion Saturday night.

Israel says eight days of aerial bombardment, followed by the ground invasion, seek to undermine Hamas’ ability to fire rockets at the Jewish state. So far, more than 500 Palestinians and four Israelis have been killed. Palestinian and UN officials say at least 100 Palestinian civilians are among the dead.

The ground offensives will put Israeli solders, Gaza militants and civilians in much closer quarters.

The guiding principle of Israel’s ground invasion is to move in with full force and try to minimize Israeli casualties, Israeli military correspondent Alex Fishman wrote in the daily Yediot Ahronoth. “We’ll pay the international price later for the collateral damage and the anticipated civilian casualties,” Fishman said.

While Israeli said its airstrikes have targeted only Hamas installations and leaders, some of the bombs were so powerful that they destroyed or damaged adjacent houses.

Karam said she always felt under threat. She said her family didn’t sleep. “We keep hearing the sounds of airplanes and we don’t know if we’ll live until tomorrow, or not,” she said.

Anas Mansour, 21, a resident of the Rafah refugee camp on the Gaza-Egypt border, said he and his family may try to leave the area later yesterday. Mansour said he was sleeping in his clothes, with his identification cards in his pocket in case he had to flee quickly.

He said he could see his neighbor loading a donkey cart with mattresses and blankets to leave, but hadn’t yet decided if he’d do the same. “Where can we go? It’s all the same,” Mansour said.

Deprivation is nothing new in Gaza, but the Israeli-led blockade of the territory has grown increasingly tighter over the past two months, making cooking gas and many foods scare.

Adding to that, last week’s bombings damaged the strip’s sanitary and electrical infrastructure, leaving many residents without power and water, and most shops are now shuttered.

“When there was a siege, we kept taking about a catastrophe,” said Hatem Shurrab, 24, of Gaza City. “But then the airstrikes started, and now we don’t even know what word to use. There’s no word in the dictionary that can describe the situation we are in.”(PhilStar)

11-M Filipinos jobless in ’09–economist

By Thea Alberto
INQUIRER.net
First Posted 14:23:00 01/02/2009

MANILA, Philippines — As the global economic crunch is expected to fully hit the country in 2009, at least 11 million Filipinos will lose their jobs, an economist said Friday.

In his forecast, former budget secretary Benjamin Diokno said millions of Filipinos would either go unemployed or be underemployed as the export sector would continue to slow down.

Labor Secretary Marianito Roque had admitted that there would be job losses although not on a massive scale.

“Unemployment will worsen, like those in the manufacturing, telecommunications, and banking,” Diokno told INQUIRER.net in a phone interview.

Diokno also noted that aside from the worsening labor situation, unemployment would increase because of the additional 1.5 million Filipinos who would be graduating from college this year and joining the labor force.

However, construction activities will hopefully continue to provide jobs, he said.

And as with previous reports, Diokno said jobs abroad would also be definitely affected by the crisis and more overseas Filipino workers would be expected to come home, especially domestic helpers, skilled workers, and medical personnel.

“Workers will continue to struggle,” said Diokno, noting that it will also not be a good time to ask for a raise.

“In an event, the supply for jobs is high and the demand is low and you ask for a raise, the usual move of employers is babaratin ka sa presyo [they will be stingy] or even fire employees,” added Diokno.

This early, employees must also start learning new skills as certain “jobs and industries will evaporate.”

He said if you were working in a bank but the industry was shaky, anticipate what kind of new jobs would emerge and equip yourself with the necessary skills.

Meanwhile, Diokno said he expects growth this year to be at 3 percent vis a vis an expected 4.6 percent for 2008. He added inflation was expected to be at 7 percent with food prices to go up by 10 percent.

VAT Revenues Did Not Reach Us, Majority Of Poor Says

As government releases the last P7.33 billion worth of incremental value-added tax (VAT) collection for the ‘Katas ng VAT’ program, majority of Filipinos believe that revenues from the tax measure did not reach them.

According to the latest IBON Survey, 68.1% of the 1,494 respondents say that the revenues of VAT did not reach them, while 16.6% say that they did.

Moreover, from a cross-tabulation of responses who said that they see themselves as poor, 72.4% of those who said that the revenues did not reach them rated themselves as poor.

84.2% of respondents also said that the subsidy package for petroleum products, electricity, fertilizer, transportation, education from incremental VAT funds do not alleviate the poor’s condition.

Asked if they believe VAT revenues go to social services spending and other needs of the people, 71.2% said no, while 11.9% said yes.

Government announced that the bulk of the P7.33-billion VAT funds were sent to the Department of Social Welfare and Development (DSWD) and the Commission on Higher Education, which receive P4 billion and P1 billion respectively.

The IBON Survey was conducted from October 1 to 10 across various regions and sectors nationwide. It has a margin of error of plus or minus three percent.

Below is the tabulation of the respondents’ perception on the value-added tax revenues.

Do you know that the Arroyo administration has recently distributed a subsidy package including for petroleum products, electricity, fertilizer, transportation, education and the like to alleviate the people’s present condition?

	Percentage
Yes	55.56
No	43.24
No Answer	1.20
	100.00

In your opinion, are these enough to alleviate the people’s condition?

	Percentage
Yes	13.86
No	84.22
Don’t Know	1.57
No Answer	0.36
	100.00

Has the VAT revenues reached you?

	Percentage
Yes	16.60
No	68.14
Don’t Know	12.85
No Answer	2.41
	100.00

Has the VAT revenues reached you?

When you look at your situation today, do you think of yourself as poor?	Yes	No	Don’t Know	No Answer	Total
	Percentage	Percentage	Percentage	Percentage	Percentage
Yes	65.73	83.30	72.40	58.33	78.38
No	31.05	13.56	19.79	41.67	17.94
Don’t Know	3.23	2.85	6.25	–	3.28
No Answer	–	0.29	1.56	–	0.40
Total	100.00	100.00	100.00	100.00	100.00

US pyramid scheme hits European banks

WASHINGTON, D.C.: Europe’s biggest bank, HSBC, joined a list of top names in world finance admitting huge potential losses in a suspected pyramid fraud scam run by ex-Wall Street heavyweight Bernard Madoff, whose brokerage was to be sold off.

The Securities Investor Protection Corp. (SIPC), which helps investors at failed brokerage firms, said Monday (Tuesday in Manila) it was liquidating Bernard Madoff Investment Securities LLC.

“It is clear that the customers of the Madoff firm need the protections available under federal law,” said SIPC President and CEO Stephen Harbeck in a statement.

But, he warned, “It is unlikely that SIPC and the trustee will be able to transfer the customer accounts of the firm to a solvent brokerage firm” because of the state of the firm’s records.

Shares in Santander, the biggest bank in Spain and the second largest in Europe after HSBC, plunged after the lender said it had exposed more than $3 billion to Madoff Investment Securities in New York.

Fortis Bank Netherlands said it stood to lose up to $1.37 billion in the suspected scam, despite lacking direct exposure to the Madoff firm.

“If, as a result of the alleged fraud, the value of the assets of these funds is nil and the respective clients cannot meet their obligations, Fortis Bank Nederland [Holding] N.V.’s loss could amount to around 850 million euros to one billion euros [$1.17 billion to $1.37 billion],” the bank said in a statement.

Billions lost

British, French, Japanese and Spanish banks and funds said investments totaling billions of dollars could be wiped off their balance sheets in a scandal set to affect some of the world’s richest people.

“The potential exposure under these financing transactions is in the region of one billion US dollars,” the London-based HSBC said.

Royal Bank of Scotland said it could lose about $612 million.

France’s Natixis investment bank, already brought low by subprime losses, put its maximum exposure at $616 million. Retail banking giant BNP Paribas revealed potential losses of $480 million.

Japanese financial giant Nomura said it could lose up to $303 million and officials in South Korea said financial institutions there had a total exposure of some $95 million.

Madoff arrested

Madoff, a 70-year-old Wall Street veteran, was arrested on Thursday, and allegedly confessed to defrauding investors of $50 billion in a scam that collapsed after clients asked for their money back because of the global financial crisis.

International Monetary Fund chief Dominique Strauss-Kahn said he was shocked that US regulators had failed to identify and prevent the fraud.

“The surprise is not that there are some thieves in the system. The question is where were the police? It’s very surprising to find you’re living in a system where a failure of the regulatory system was so big,” he told a news conference in Madrid.

Banks have rushed to disclose potential losses in an apparent bid to avert any deepening of the suspicion that has frozen credit markets.

US authorities alleged that Madoff delivered consistently strong returns to clients by secretly using the principal investment from new investors to pay out other investors in what is known as a “pyramid fraud.”

US Vice President Dick Cheney said in a radio interview that the alleged scam by the former Nasdaq chairman was “very disturbing” but blamed a few “bad apples.”

The unraveling

The scheme apparently worked as long as Madoff could attract new investors but seems to have unraveled when some of his clients asked to withdraw their investment – only to discover that his seemingly brimming coffers were empty.

British investment fund Bramdean Alternatives Limited, which revealed it had invested about $31.2 million in Madoff’s company, said the scandal raised “fundamental questions” about the US financial regulatory system.

“It is astonishing that this apparent fraud seems to have been continuing for so long, possibly for decades, while investors have continued to invest more money into the Madoff funds in good faith,” the firm said in a statement.

More European banks

Spain’s El Pais newspaper reported the country’s second-biggest bank, BBVA, could lose around $686 million in the scam.

Italy’s biggest bank, UniCredit, said its exposure was around $103 million and one of its investment units may also have been indirectly affected.

Geneva’s private banks could lose up to $5 billion, Swiss newspaper Le Temps reported.
— AFP(ManilaTimes)

PHILIPPINES BEHIND IN 3 DEVELOPMENT TARGETS

By Llanesca T. Panti, Reporter

Much needs to be done in order for the Philippines to meet the eight Millennium Development Goals (MDGs) set by the United Nations, a UN official in Manila said Tuesday.

Suneeta Mukherjee, chairman of the UN Advocacy Group and country representative of UN Population Fund (UNFPA) office in Manila, said the Philippines is not on track in meeting three of the eight goals—the ones on maternal health, on combating HIV/AIDS, malaria and other diseases and on achieving universal primary education. The other millennium development goals are eradicating extreme poverty and hunger, promoting gender equality and empowering women, reducing child mortality, ensuring environmental sustainability and developing a global partnership for development.

The advocacy group is comprised of UN officials posted in Manila, who launched on Tuesday a search for an MDG youth champion, a project with the Rotary Club of Makati Legaspi.

Mukherjee said 11 mothers die during childbirth everyday in the Philippines. Ten of these mothers could be saved, she added.

“Women, just like the unborn child, have the right to live,” said Mukherjee, who first visited the Philippines in 1977.

She called for a concentrated effort from the Department of Health, stressing that it needs to educate parents about a proper family planning program to stop the maternal-death cases, saying that mothers who usually die in giving birth bear six children during their lifetime.

“This situation forgets how special parents are,” Mukherjee said. “Mothers are crucial in teaching the children the values that they need to improve not only themselves but moreover their country.”

Abortions on the rise

Worse, Mukherjee added that one-third of mothers are committing abortion, with increasing cases involving mothers age 25 years and younger.

“This is a clear violation of women and children’s rights. Abortion should not be done under all circumstances,” she said.

She also hit the reversal of trend with regard to HIV positive or AIDS victims, saying that of 23 million young Filipinos, four million have already engaged in sex at a young age. That may explain why HIV cases involving the youth went up 29 percent, she added, citing also that a third of young women gave birth before their 21st birthday.

The UN official also reported that the carefree lifestyle of young people today that includes drinking and smoking is not doing any good. Around nine million young Filipinos smoke and 11 million drink alcoholic beverages, she said, adding that five out of six youth either smoke or drink.

“We cannot afford to be complacent because the future of the country depends on these young ones,” Mukherjee said.

And to help them become the hope of the country, she said young people receive quality education to provide them with knowledge and information needed to make better life decisions.

Today, only 58 percent of Filipino children have access to primary education, far short of the 100-percent target, the UN official added, “There is just seven years to go” until the deadline in 2015.

But Mukherjee said she believed the Philippines and the other countries that committed to the development goals are capable of overcoming the challenges, even amid the global financial crisis.

Youth champion

The advocacy group and the Rotary Club of Makati Legaspi will select eight MDG champions, who will be announced in March 2009. Winners will receive an Orlina or Abueva glass sculpture, scholarship grant, study tour to the UN general headquarters in New York City, a slot in the third Asia and the Pacific Model UN Conference and a grant to travel around the Philippines as UN goodwill ambassadors.

Faustino Almendral, president of Rotary Club of Makati Legaspi, said, “We are happy to be a part of this project, because the Rotary Club’s goals’ are almost the same as those of the MDGs.”(ManilaTimes)

Unemployment up, at 6.8% in October

By Darwin G. Amojelar, Reporter

The number of unemployed Filipinos rose slightly in October to 6.8 percent, dragged by the weak performance of the economy, particularly the services and industry sectors, the government reported Tuesday.

The government earlier reported that the economy, as measured by gross domestic product (GDP) slowed to 4.6 percent in the first three quarters of this year compared with 7.1 percent in the same period last year. GDP is the total value of all final goods and services produced in a country within a year.

The economy in the third quarter has been damaged but not quite ravaged by the global financial turmoil and high oil prices, the National Statistical Coordination Board (NSCB) earlier said.

The National Statistics Office (NSO) said the unemployment rate rose to 6.8 percent, or 2.53 million, in October from 6.3 percent, or 2.25 million, in the same month last year.

But the unemployment rate in October was lower than the 7.4 percent registered in July.

Socioeconomic Planning Secretary Ralph Recto said the global financial crisis and high oil and food prices restrained the country from gaining more employment in 2008.

“The higher unemployment rate signals that the government needs to take immediate actions in creating and safeguarding employment and livelihood for the Filipinos,” he added. “As two-thirds of the world economy is now entering recession and the global financial crisis has already afflicted the real sector of the country’s economy, it is imperative that the government pays utmost attention to the objective of creating and saving as many jobs as possible. This will help minimize the adverse impact of the crisis to the most vulnerable sectors of the economy.”

Statistics breakdown

The statistics agency reported that the highest unemployment rate was recorded in Metro Manila at 12.8 percent, followed by Calabarzon (the provinces of Cavite, Laguna, Batangas, Rizal and Quezon), 10 percent and Central Luzon, 8.1 percent.

The National Statistics Office said 32.9 percent of the unemployed Filipinos were high-school graduates; 22.1 percent, college undergraduates comprised about one-fifth, while the college graduates, 18.9 percent.

Out of about 58.2 million population 15 years old and over in October, 37.1 million persons were in the labor force or 63.7 percent. Last year’s labor force participation rate was 63.2 percent.

The number of employed persons in October was estimated at 34.5 million or an employment rate at 93.2 percent, lower from last year’s 93.7 percent.

The statistics office said the National Capital Region posted the lowest employment rate at 87.2 percent. Besides that region, Central Luzon with 91.9 percent and Calabarzon, 90 percent had employment rates below the national value of 93.2 percent.

Of the total employed Filipinos, the agency reported that 49.6 percent were in the services sector—down by 1.6 percent from last year’s 51.2 percent.

Employment in industry sector also decline to 14.7 percent from 15.2 percent last year, and agriculture to 35.7 percent from 36.1 percent.

In terms of occupation, laborers and unskilled workers constituted the largest group at 32.6 percent of the total employed persons in October 2008. Farmers, forestry workers and fishermen were the second-largest group, accounting for 17.7 percent of the total employed population.

Underemployment rate

The country’s underemployment rate in October was estimated at 17.5 percent or about 6 million people.

Around 3.7 million or 61.8 percent of the total underemployed persons were reported as visibly underemployed or working fewer than 40 hours during the reference week.

“Most of the underemployed were working in the agriculture sector [48.8 percent] and services sector [36 percent]. The underemployed in the industry sector accounted for 15.2 percent,” according to the National Statistics Office.

Recto, also the director general of the National Economic and Development Authority (NEDA), said the government would speed up the creation of employment by ensuring that the allocated budget is fully and efficiently spent.

“Resources will be shifted from slow to fast-moving and uncomplicated projects with visible employment results,” he added.

Recto said another step to be taken is to encourage firms and households to make the recent income tax measures like lower corporate income tax rate, exemption of minimum wage earners from paying income taxes, increase in personal exemption of non-minimum wage earners an opportunity for business expansions and entrepreneurial activities.

Common action plan

He also said the tripartite (government, business, and labor) common action plan would be continued through “decisive dialogue on coping mechanisms to preserve as much employment as possible, while making industries cost-effective and productive.”

Another measure for employment generation is to intervene for the young labor force by offering more training vouchers and scholarships, Recto said, adding that this initiative would “help create a better human resource that is ready for the economic upturn.”

Recto said the allocated budget would also be maximized by increasing and fast-tracking the employment of educators, health workers and law enforcers commensurate to the needs of the sectors.

But he warned that while “this could help safeguard the nation from the social fallouts of the global slump, it should be done efficiently by ensuring that problems of misallocation of government employees are addressed.”

Helping SMEs

The authority official likewise said government would intensify support to small and medium enterprises and entrepreneurs by facilitating the provision of credit, technology and marketing assistance.

Recto outlined these initiatives as part of the economic sustainability plan in the light of the global slowdown, which he said must be “multi-pronged in creating and safeguarding Filipino employment and livelihood.”(ManilaTimes)

Bank declares “holiday” Legacy on rehab plan

BANK HOLIDAY! As early as 8 a.m. yesterday, motorcycle riding depositors were already at the premises of Pilipino rural Bank along CPG Ave., this city to check the veracity of the report that the bank declared a “bank holiday”. Truly, they found the bank closed after dyRD repoerters made an exclusive check on the bank holiday early yesterday morning. Foto DANNY REYES

Averting a possible panic among its thousands of Boholano depositors that could cause substantial withdrawals, the local branch of Pilipino Rural Bank (PRB) declared a “bank holiday” starting last Monday. Bank depositors were surprised to see the “bank holiday” notice

posted at its entrance without a definite period when its operations will resume.

PRBank is among the so-called subsidiary rural banks of the Legacy Group, a financial firm that is also currently caught in a situation of insolvency.

The Bangko Sentral ng Pilipinas (BSP) is trying to close down the 11 rural banks of Legacy Group for its capital deficiency. In fact, another branch – the Philippine Countryside Rural Bank in Cebu – also declared a “holiday” yesterday.

A bank that is incurring a liquidity problem (short of cash) declares a “holiday” in order to avoid a possible “bank run” where depositors who are aware of the firm’s solvency situation will panic and pull out their deposits.

According to the notice posted at the PRBank entrance, management is awaiting an emergency loan from the Bangko Sentral to service all transactions of its clients.

Depositors who were alarmed of the sudden closure of the bank since Monday called up bank manager Delia Duliguez on her mobile and apartment telephone to no avail.

Duliguez was not at her apartment in Calceta Street, this city, when checked by the Chronicle yesterday morning after the top rated “Inyong Alagad” and “Pulso” programs of dyRD were jammed with depositors who sounded panicky on the status of their banks deposits.

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Many depositors were enticed to deposit at the PRBank with their “double your money in five years” while its holding company reportedly marketed a more juicy offer of “double your money in three years.” This twin offer received a resounding patronage from Boholanos, not to mention their money back guarantee on car and motorcycle loans. A bank depositor from Jagna town who monitored the dyRD report while dropping at a cellphone shop rushed to the Chronicle editorial offices mid-morning yesterday to confirm that she deposited P2 million out of her retirement benefits and savings from her children working in the United States due to the high interest rate offered by the bank.

The depositor availed of the bank’s product that guarantees to double the deposited amount after a period of five years.

She said Duliguez was her friend but she started to worry when all her attempts to call the bank manager was unanswered.

A similar attempt to call up the bank’s “new accounts” head Bebelyn Ferolino also proved futile, the depositor said.

Several depositors who called up Station dyRD said it worries them that the bank’s management has not issued an official statement regarding the financial status of the bank and their deposits.

“LEGACY ON REHAB”

Antonio “Tony” Wycoco, vice president and marketing division head of Legacy Group’s pre-need insurance, said in an interview over dyRD yesterday that his company is currently undergoing a rehabilitation plan.

Wycoco said Legacy’s pre-need company offers another savings scheme that doubles the money of investors within a period of 3 years.

Hence, an investment of P100,000 will become P200,000 after three years. It will be paid out in checks issued to the investor on a quarterly basis.

According to Wycoco, Legacy management is requesting a 2-month moratorium on all interest and principal investment payments starting last November.

He said their investment product is entirely different from that of its sister company PRBank.

However, since both companies are in financial trouble, the group’s assets may be utilized in paying out investments and liabilities.

Wycoco disclosed that the management of Legacy may opt to apply for dissolution with the Securities and Exchange Commission (SEC), in order to payback their depositors of their investments, but, minus the interests.

“The company already discussed the possibility that if the company could not rehabilitate, then the most likely step to return the investors’ capital is to apply for dissolution,” he said.

Under the process of dissolving the company, its assets will be liquidated to pay out investors. He warned, however, that this process will take time.

PRBank deposits are covered by the Philippine Deposits Insurance Corporation (PDIC) which insures up to P250,000.

“HIGH RISK”

Wycoco admitted that they made it a company policy to inform their investors that they are venturing into a high risk investment.

“It is a high yielding investment but it also involves high risks. We sell it to our investors honestly,” he stressed.

The Legacy officer said their company will be paying an additional 6-percent interest for the 2-month delay of payments.

LOCAL BANKERS: NO COMMENT

The Bohol Bankers Association declined to issue its official statement with regards to the financial distress encountered by Pilipino Rural Bank which has a branch operating in the city.

Union Bank manager Marius Borja told the Chronicle last night the association wanted to check on the matter in order to comment regarding the bank holiday.

China Bank manager Rodney Lumuthang who sits as president of the bankers association said that Bangko Sentral ng Pilipinas (BSP) was not informed of the bank holiday by PR Bank management. This was the statement issued by the financial and consumer department of BSP-Manila when contacted by Lumuthang.

The local bankers association would usually issue public statement when bank holiday is declared in any of the banks which belong to their association.(TheBoholChronicle)

Governments bail out banks

Reuters
First Posted 20:59:00 10/13/2008

LONDON—Governments across the world launched multi-billion dollar bailouts on Monday to shore up tottering global banks and Britain called for a new Bretton Woods agreement to reshape the world financial system. The slew of bank bailouts worth hundreds of billions of dollars were designed to stave off the world’s worst financial crisis in nearly 80 years, accompanied by declining global economic growth and the threat of widespread recession.

“Only by global action can we fully restore the confidence that is needed and build the international financial order,” said British Prime Minister Gordon Brown.

He called on world leaders to create a new “financial architecture” to reflect the global reach of economics and banking, in much the same way that the current international economic system was set up at a conference in Bretton Woods, New Hampshire, in 1944.

In the United States, focus was on Morgan Stanley, whose share price plunged 58 percent in the last week, after Japan’s Mitsubishi UFJ Financial Group said on Monday it had invested $9 billion under revised terms, a move analysts said was likely to bolster still fragile market confidence.

Britain said it would spend up to 37 billion pounds ($63.95 billion) buying into top UK banks, making the UK government the biggest shareholder in Royal Bank of Scotland and the merged Lloyds TSB/HBOS.

France will use two entities to help banks overcome the financial crisis with one offering 300 billion euros in guarantees on interbank lending and the other a Є40 billion fund to take stakes in companies, media said.

Germany will launch a rescue plan including a fund to provide up to Є400 billion ($548.9 billion) in guarantees for banks, according to a draft bill seen by Reuters on Monday.

Bank guarantees provided by the fund will run until December 31, 2009, the draft bill showed.

And the Italian government was to meet later in the day to look at new measures for financial stability.

Japanese Finance Minister Shoichi Nakagawa, meanwhile, said his country would consider guaranteeing all bank deposits if necessary, news agency Jiji reported.

Both Democratic presidential candidate Barack Obama and Republican counterpart John McCain were also preparing to roll out plans to rescue the country from economic uncertainty and rising joblessness.

Euro zone leaders held an emergency meeting on Sunday and French President Nicolas Sarkozy said people could expect a flurry of coordinated announcements from national capitals across Europe later on Monday.

In tandem on Monday, European central banks said they would lend out as much US dollar liquidity as commercial banks need in a further bid to tame money market tensions.

In a joint announcement with the US Federal Reserve, the European Central Bank, the Bank of England and the Swiss National Bank said they would meet all bids from commercial banks at a fixed interest rate.

Australia and New Zealand earlier guaranteed all bank deposits and Indonesia upped its guarantee to 2 billion rupiah ($203,000) while India pledged more liquidity to help financial markets.

Qatar launched a $5.3 billion plan to purchase shares of its listed banks. Saudi Arabia cut its lending rate on Sunday to provide liquidity to its banks and the United Arab Emirates guaranteed bank deposits.

The moves followed a weekend of crisis talks in the United States and Europe in which governments pledged to support the financial system, which has moved to the brink of collapse as it suffers from both steep losses in the credit market and a lack of trust in lending that has frozen the flow of capital.

The need for bailouts has become particularly trenchant against a background of a global economic slowdown, with many countries facing recession.

The crisis has swept across financial markets, sending many stock markets into free fall. MSCI’s main world stocks index, for example, has lost a quarter of its value since the beginning of October.

But equity investors appeared to be comforted by the government bailouts on Monday. The pan-European FTSEurofirst was up 5.2 percent and Asian shares outside of Japan, which was closed for a holiday, gained around 7 percent.

US stocks index futures pointed to similarly solid gains at the Wall Street open.

“We are arguably now near the end point in terms of the extremely violent sell off in equities and widening in spreads, said Sean Maloney, a bond strategist at Nomura.

Money markets — the heart of the credit crisis — eased but remained tight. Three-month dollar Libor fell to 4.75250 percent from 4.81875 percent on Friday.

Banks deposited a record 155 billion euros overnight at the European Central Bank, rather than lend to each other.

Authorities have been trying to avoid a repeat of the decision to allow Lehman Brothers to go bust.

The Federal Reserve gave its approval on Sunday to the takeover of Wachovia Corp by Wells Fargo & Co. (PDI)

JPEPA Ratification Puts Philippines in More Danger vs Global Crisis

Contrary to President Arroyo’s statement that the ratification of Japan-Philippines Economic Partnership Agreement (JPEPA) will protect the country from the global financial crisis, it will make the country more vulnerable to economic shocks.

BY IBON FOUNDATION
Posted by Bulatlat

Contrary to President Arroyo’s statement that the ratification of the Japan-Philippines Economic Partnership Agreement (JPEPA) will protect the country from the global financial crisis, it will make the country more vulnerable to economic shocks.

JPEPA and similar free trade deals further opens the local economy to more foreign plunder and drags the country to the global crisis worsened by trade and investment liberalization, said IBON research head Sonny Africa. Bilateral deals like JPEPA enable beleaguered countries like Japan to pass their crisis to other economies in the region through more liberalization.

Even as Japan claims that it is on the way to recovery, its economy has been grappling with stagnant growth and high unemployment for nearly two decades and is aiming to further open up other economies to cope with its internal problems. The emerging scenario of a US economic slowdown, financial disorder, soaring energy and food prices only make its situation more urgent.

The experience of the country with similar free trade deals such as the GATT-WTO, which the Senate ratified in 1994, has proven that no amount of safety nets could protect the economy and the people’s livelihood from the harmful effects of liberalization.

According to IBON research head Sonny Africa, it is ironic that the Senate ratified the JPEPA even as the WTO talks broke down precisely because of questions on the supposed development gains to be achieved from trade and investment liberalization. “When will this government learn from the harmful effects of liberalization on the economy?” he asked.

The approval of JPEPA surrenders Philippine sovereignty and will reinforce the country’s backwardness. The country will be further prevented from implementing economic policies essential for its development and will be obliged to give similar disadvantageous terms in pending deals with the US, European countries and others.

“There is no real gain for the Philippines and especially the poorest and most marginalized sectors with JPEPA. In agriculture it is the big corporate plantations that will gain and not the country’s millions of small farmers,” Africa added.

To protect and build the domestic economy, the country needs trade protection against imports such as tariff and non-tariff barriers and investment controls, and not free trade deals like JPEPA that only further expose the country and deepen its links to the failing global economy. (Posted by Bulatlat)

Another band aid solution!

THE militant Bagong Alyansang Makabayan-Bikol (Bayan-Bikol) dismissed Albay Gov. Joey Salceda’s proposal for a so-called bank shield that would amount to P50 billion saying that it would just obscure the problem and hide the true solution.

According to Tessa Lopez, public information officer of BAYAN-Bikol, “this is another band aid solution that will pour money to the Bangko Sentral ng Pilipinas (BSP) and the Philippine Depositors Insurance Corporation (PDIC), P40 billion to go to BSP and P10 billion to PDIC.”

Salceda has argued that his proposal would protect deposits and shore up depositor confidence in banks which, according to Bayan-Bikol is a very temporary measure.

“The governor is obscuring the fact that the real and long term solution to protect the Philippine economy from the US financial crisis is to junk and abandon the globalization policy of the Macapagal-Arroyo which includes deregulation, liberalization and privatization,” Bayan-Bikol said in a statement.

It added that such policy has tied our economy to the US and made us extremely dependent on the superpower, where they have extracted billions of dollars from our country.

“It is time to sever this type of extremely unequal relation with the US ,” Lopez said.

She added: “Salceda’s most recent proposal is the same with his P75 billion economic stimulus proposal and his Noah’s ark, they just want to pump prime the economy with money to save big corporations but do nothing to protect the people from the long term effects of the crisis.”

“Even the so-called decrease in the inflation rate in Bicol will be inconsequential because the US crisis along with the specific characteristics of the Bicol region will wipe it out. The proposal of Gov. Salceda is incomplete it should be done simultaneously with the junking of deregulation,” Lopez stressed.(BicolMail)

World stocks drop on widespread panic (Scramble for cash sparked)

By Kevin Plumberg
Reuters
First Posted 10:50:00 10/10/2008

HONG KONG — Asia stocks dropped sharply on Friday, with Japan’s Nikkei plunging 11.0 percent, while the yen and gold rose on growing fears that no government effort so far has rejuvenated credit markets or kept the global economy from a path to recession.

The Nikkei share average plummeted in early trade, and the Osaka stock exchange had to halt trading after a circuit breaker was tripped.

Overnight Wall Street stocks crumbled in the final minutes of trade, with the S&P 500 falling 7.6 percent.

Selling in equity markets was brutally swift, taking the MSCI index of Asia-Pacific stocks excluding Japan down 3.5 percent to the lowest since June 2005.

Government bond futures soared as the rapid decline in Asia stocks forced investors to buy the nearest safe haven despite fears of a supply glut that have recently weighed on US Treasuries.

“Equity and fixed income markets seem to be stuck in a negative feedback loop as the lack of interbank lending and funding and waning investor confidence keep pushing one another,” UBS currency strategists said in a note to clients.

The 10-year Japanese government bond future was up 0.4 point to 138.89 and the 10-year US Treasury note futures were up more than a full point

The US dollar fell to the lowest since March against the yen, at 98.55 yen

Spot gold prices were up 2.0 percent to $923.30 an ounce to the highest since July.

US crude oil futures fell about 3.0 percent to a fresh 12-month low in electronic trade on Friday on concerns the growing global financial crisis would send demand for fuel slumping.

By 0033 GMT, US crude for November delivery was at $83.99 a barrel, down $2.59 from Thursday’s settlement, having earlier fallen to as low as $83.81.

(PDI)

IMF readies bailouts for countries

By Lesley Wroughton
Reuters
First Posted 08:40:00 10/10/2008

WASHINGTON — The International Monetary Fund said on Thursday it was ready to lend to countries hit by the global credit crunch, and had activated an emergency financing mechanism first used in the 1990s Asian crisis.

The Fund already sent a mission to Iceland, where the government has seized control of its largest bank, and has warned that the worst financial crisis since the 1930s Great Depression could inflict lasting economic harm on the world.

“Yesterday I activated emergency procedures of the IMF to respond quickly,” IMF Managing Director Dominique Strauss-Kahn told a news conference. “We are ready to answer any demand by countries facing problems,” he said, adding that no country is immune from the crisis.

The IMF chief said the IMF was willing to provide financial assistance not only to emerging and developing nations, but also to Western countries.

“Nobody knows if some … advanced economies will not also be in need of some help by the IMF,” he said, adding that countries needing to borrow will face more streamlined conditionality than normal and funding will be made available quickly. “Very quickly means two weeks at most,” he added.

After several years of no major crises in emerging economies, the move puts the IMF’s board of member countries and staff on alert that the Fund will have to respond quickly if a country needs financial help.

It also puts the global financial firefighter more at the forefront of the current financial crisis following months of being on the sidelines.

Panic over toxic, illiquid US mortgage loans has sapped confidence in financial institutions, forced governments to pledge hundreds of billions of dollars of taxpayer money and pushed Western and other central banks to deliver their first coordinated interest rate cut.

Speaking ahead of IMF and World Bank meetings of world finance leaders in Washington this weekend, Strauss-Kahn said the main task for policy-makers was to restore confidence and calm global markets.

Group of Seven finance ministers and central bank chiefs also meet in Washington on Friday to consider their options.

The IMF’s emergency facility was created in 1995 as a way of speeding up the approval of loans to countries in peril.

It was first used in 1997 to help the Philippines, Thailand, Indonesia and South Korea end crushing runs on their currencies during the Asian financial crisis.

The IMF, which played a central role in the bailouts of countries in Asia and Latin America in the 1990s, relied on lending to fund its operations. But with fewer crises over the years, it had faced a growing income deficit, prompting an agreement in April to sell some of its gold stocks and invest profits in government and corporate bonds.

The IMF has about $200 billion immediately available to lend to countries in need but can tap other sources. This is small compared to the trillions of dollars central banks and governments have poured into the financial system over the past few weeks.

UNDER PRESSURE

Emerging markets are under pressure again after strains in the United States and Europe spread. Investors are fleeing their securities for safer assets, foreign banks are cutting lending and the countries’ exporters are braced for weaker demand from Western consumers.

Strauss-Kahn renewed calls for more coordinated steps to calm panicky markets beyond the unprecedented simultaneous action of central banks on Wednesday to cut interest rates.

He said the global economy was on the cusp of recession but with quick and forceful action, the spreading crisis could be contained.

“All kinds of cooperation has to be recommended. All lonely acts have to be avoided, if not condemned,” he said.

His calls for more coordination were backed by World Bank President Robert Zoellick who said he hoped a meeting of Group of Seven industrial nations on Friday will indicate they “are getting ahead of the curve.”

He said while countries will take different actions, tailored for their own circumstances, they should coordinate beyond just the G7 members to target the same basic problems.

“The actions need to be coherent and reinforcing,” he said, referring to Wednesday’s simultaneous rate cut by central banks.

(PDI)

BIR chief resigns–Palace

By Thea Alberto, Lira Dalangin-Fernandez
INQUIRER.net
First Posted 10:34:00 10/10/2008

MANILA, Philippines – (UPDATE) Bureau of Internal Revenue Commissioner Lilian Hefti has resigned, Malacañang has announced.

Deputy presidential spokesman Anthony Golez said in a text message Friday that Hefti submitted his resignation days ago to President Gloria Mapacapagal-Arroyo.

“President Arroyo has already made her choice as to Hefti’s replacement but the announcement will be upon the arrival of Secretary Gary Teves tomorrow [Saturday] who is in the US,” added Golez.

Executive Secretary Eduardo Ermita, in an interview at the House of Representatives, cited health reasons for Hefti’s resignation although Press Secretary Jesus Dureza told Palace reporters that one could also be the BIR’s alleged “failure to meet some targets.”

“The President measures the performance [of her officials],” Dureza said, noting that in the case of the BIR, “meeting revenue targets is a very important part of economic growth.”

Ermita confirmed Golez’s statement that the President has found a replacement for Hefti, but did not also name the successor.

Hefti, a former BIR deputy commissioner, was appointed in June 2007 as officer-in-charge of the revenue agency after the Palace sacked then Commissioner Jose Mario Buñag.

Hefti’s resignation came a day after Chief Presidential Legal Counsel Sergio Apostol left his post to go to Union Bank as board member and to prepare for the 2010 election, where he will run for Congress.

The BIR, which accounts for about two-thirds of government revenues, is hard-pressed to meet its target to keep the government’s deficit goal. For 2009, economic managers had said that they expected a budget deficit of P60 billion.

The bureau conceded that it might fall short of its 2008 collection target of P854 billion, partly because of the slowdown in the economy’s growth and the tax relief granted by law to individual taxpayers.

Upon her assumption into office last year, Hefti started implementing several measures to boost tax collection such as auditing tax remittances made by the country’s Top 10,000 corporations, cleaning up of the BIR taxpayer database, and intensifying collection of the agency’s accounts receivables.

With a report from Reuters

Arroyo and Bush Share Same Economic Philosophy

By Renato M. Reyes, Jr.
BAYAN Secretary General

Gloria Macapagal-Arroyo and George W. Bush share the same economic philosophy. “In times of crisis, pass the burden to the people.”

It is therefore no surprise why Mrs. Arroyo is supportive of the $700 billion bailout plan of the Bush administration. The Bush proposal would make the American taxpayers pay for billions of bad debts that have been plaguing and clogging the US financial markets. The Bush regime is unjustly forcing the public to clean up the mess that was created by Wall Street itself.

Not long ago, Mrs. Arroyo employed the same economic philosophy when she pushed for an increase and expansion of coverage of the Value Added Tax. The argument then was that the country was facing a fiscal crisis and so taxes had to be raised. The burden of resolving the fiscal crisis was placed squarely on the consumers, many of whom come from the poor. This happened despite government’s own shortcomings with regards to tax collection and corruption.

Social justice and accountability are concepts lost on Bush and Arroyo. The Bush regime refuses to punish the finance speculators on Wall Street who were themselves responsible for the sub-prime mortgage crisis. The Bush regime has refused to acknowledge the failures of deregulation. It has opted for the easy way out which simply means passing the burden to the people.

The Arroyo regime on the other hand has refused to take responsibility for the failed economic policies that have resulted in a fiscal crisis, on top of massive poverty, unemployment and inflation. It sees that for the Philippines to waddle through the crisis, people have to shell out more in taxes.
The Arroyo regime claims that the Philippines is insulated from the crisis because of OFW remittances continue to shore up the country’s finances. However, this phenomenon has nothing to do with the claim of strong economic fundamentals. If anything, the country’s dependence on OFW’s to provide the much needed foreign exchange shows the domestic economy’s fundamental weakness.

The government admission of lower growth targets, slower export growth as well as vulnerabilities in foreign direct investments and speculative investments show that the Philippines is not totally shielded from the US financial meltdown.

Mrs. Arroyo has shown herself a supporter of the Bush bailout of bankrupt private banks. We ask her, if the Filipino people should file for bankruptcy, would she bail them out as well? ### (PinoyPress)

US Financial Crisis: The Philippines’s Economic Debacle

Having produced only disastrous results, economic management can no longer be left in the hands of an elite corps of bureaucrats and technocrats who ape lock, stock and barrel models purposely to make corporate profits bigger at the expense of workers, farmers, and other marginal sectors.

By the Policy Study, Publication and Advocacy
Center for People Empowerment in Governance (CenPEG)
September 29, 2008

The opposing views proliferating in the media on whether the U.S. financial meltdown will have an extensive impact on the Philippine economy are expected and time may help settle this debate. By zeroing on the element of “impact”, however, these divergent views – voiced largely by economic authorities, bankers, and financial analysts – only miss the truth about the country’s economic anchors, a core issue that is hardly touched every time a financial crisis in the U.S. happens. They forget that neo-liberalism, enforced in most parts of the world by U.S.-led global capitalism, has left billions of people more marginalized and their lives more miserable by the day.

The Philippine economy has been fettered by prolonged unequal ties with its former colonial master – the U.S. – and by being made an appendage to global capitalism. This imbalanced relationship takes its roots, among others, in post-war onerous impositions, one-sided trade agreements, bitter debt payment programs, and unilaterally-enforced credit arrangements.

At the heart of this historical imposition is the Philippine presidency and its economic generals who have perpetuated this unequal relationship for decades, keeping the Philippines always at the receiving end of global capitalism’s periodic crisis. The current U.S. financial crisis – a result of the unregulated speculative financial sector leading to a housing mortgage mess and credit crunch – should compel everyone to reject this inherently disastrous economic model and work toward an independent, people-oriented economic policy.

“Dark age”

To begin with, the Arroyo government is lying through its teeth when it assures the business community not to fear as the country will ride out America’s financial meltdown even if this has all the makings of a second Great Depression or what European groups call a modern “dark age.” However, as early as January this year, even the International Monetary Fund (IMF) foresaw the Philippines and the rest of Southeast Asia – and other developing regions – as bearing the brunt of the global impact from a major economic slowdown in the U.S. The recession, the Fund said, will trigger a stiffer export competition from China at the expense of the Philippines and other export-driven countries in the region such as Thailand, Indonesia, and Vietnam.

Making a similar forecast, the economic intelligence center Euromonitor projected that the Philippines and other countries in Southeast Asia heavily dependent on exports to the U.S. will be hit by the economic slowdown as the export demand by the world’s biggest economy declines.

Indeed, the U.S. remains a major destination for Philippine exports. About 20 percent of the country’s exports go directly to the U.S. Another 50 percent of the exports go to Japan, China, Hong Kong, South Korea, Taiwan, and Malaysia but these are actually components assembled into products that end up in the U.S. market. All these mean that cuts on the U.S. export demand could be potentially devastating to 70 percent of the country’s exports.

Aside from export manufacturing, highly dependent on the U.S. market are the information technology-enabled industry and the business process outsourcing (BPO) sector. In 2005 these accounted for 90 percent of BPO export revenues and over two-thirds of foreign equity.

At the receiving end

Each time the U.S. economy tumbles, the Philippines and the rest of the world are bumped aside. Being in the clutches of the U.S. economic hegemony since colonial times, however, the Philippines is at the receiving end of the crisis of capitalism that America passes on to small, developing countries and emerging economies.

To recall, America bought the Philippines from Spain at the end of the 19th century in the period of U.S. capitalist expansion and its conquests for market, cheap labor, and raw materials in Asia Pacific. A strong lobby mounted by U.S. producers against Philippine exports during the Great Depression of the 1930s led to the transition that ended with the granting of independence.

But the grant of independence in 1946 was conditioned upon onerous agreements that tied the Philippines to a “free trade” allowing the unrestricted entry of U.S. exports with parity rights for American citizens to exploit the country’s natural wealth, and own properties and strategic industries. Emerging from the war in control of more than half of the global wealth and awash with trade surpluses, America had to keep the Philippines and other countries in its grip where it could dump its excess commodities, exploit their cheap raw materials, expand finance capital operations, and extend a new-found military hegemony. Accordingly, national security doctrines during the period emphasized the importance of maintaining a pro-U.S. government in the Philippines that would guarantee America’s over-arching economic and military objectives.

Over the next 60 years, the Philippines’ economic dependence on the U.S. gave birth to treaties and policies allowing the entrenchment of U.S. strategic enterprises and investments, the export of raw commodities, heavy reliance on foreign investments, and the elimination of protectionism. This neo-colonial structure maintained the system of landlordism and a bourgeoisie that depended on the plunder of natural resources and export of cheap raw commodities. As a result, the local economy became lethargic and generally backward, unable to shield itself from the rise and fall of an increasingly globalized economy where modern agriculture, a strong industrial base, and protective barriers are the keys to survival.

Bitter prescriptions

Imbalanced trade, a weak manufacturing base, and heavy borrowings further resulted in the accumulation of foreign debt that made successive and corrupt administrations accommodating to bitter economic pills prescribed by the IMF and World Bank. Under the regime of the structural adjustment program (SAP), up to 50 percent of the national budget went to automatic debt servicing, regressive taxes were increased while social services were reduced, and strategic public corporations went to private hands many of them TNCs.

The government’s commitment to globalization and World Trade Organization (WTO) led to the deregulation of the oil industry. Import liberalization displaced the country’s small producers while tens of thousands of workers lost their regular jobs due to labor-only contract system.

These economic policies took shape in the midst of the periodic crisis of contemporary capitalism battering the U.S. and other capitalist countries. Holding neo-liberalism with a sacred aura, the country’s economic strategists laughed off criticisms from progressive groups that this “new” capitalist paradigm was designed to bring relief to the leading capitalist economies at the expense of the Philippines along with other emerging economies.

Champions of neo-liberal globalization have shown no empirical evidence to support their claim of “equal playing field” and economic growth. On the contrary, neo-liberalism has lost its appeal as it has only widened the gap between rich and poor the world over. Today, nearly three billion people – half the world’s population – are living on less than two dollars a day. Conversely, the richest 2 percent of adults in the world own more than half of global household wealth.

Poverty and unemployment

Here at home, claims of economic growth based on GDP cannot hide the unprecedented increase in the number of poor Filipinos by three million (2003-2006), with the total conservative number of poor now 27 million. Current increases in the prices of oil and food products aggravated by the adverse impact of the U.S. meltdown will likely increase the number of poor several times in the coming years. Meantime, about 4.1 million people are jobless with the country facing a 10.8 percent underemployment record in 2007. At least 3,000 Filipinos leave the country everyday in search of jobs abroad. There are other grim statistics about the Philippines human development rating that will make it hard to see any positive signs of success attributed to government’s neo-liberal policies.

The management of the country’s economy is a serious responsibility that should be grounded on the people’s rights and well-being, above all else. Having produced only disastrous results, economic management can no longer be left in the hands of an elite corps of bureaucrats and technocrats who ape lock, stock and barrel models purposely to make corporate profits bigger at the expense of workers, farmers, and other marginal sectors.

Clearly, the most recent financial crisis in the U.S. has dealt a mortal blow to the failed but deadly practices of neo-liberalism the world over and undoubtedly lays the groundwork for the crafting of alternative policies more responsive to the needs of the powerless and marginalized in our societies. We can start right here in our country by working for the end of the destructive and rapacious rule by the elite and building people-centered democratic governance. (PinoyPress)

ADB Grants 12-Billion-Peso Loan to Philippines to Fix Fiscal, Governance Problems

MANILA, PHILIPPINES – The Asian Development Bank (ADB) is extending a $250 million loan to strengthen the policy reform initiatives of the Philippine government for fiscal management, investment climate and social sectors.

The loan is a second of a three-part Development Policy Support Program (DPSP) aimed at helping the Philippines achieve its medium-term development goals. The first DPSP loan was approved in February 2007.

Since then, the Philippine government has implemented a series of measures to address the fiscal imbalance, resulting in improvement in the fiscal situation and macroeconomic stability. These measures provided much needed funds for increased spending on the social sector and infrastructure in 2007. The measures also contributed to the Philippines’ best macroeconomic performance in over 30 years.

However, the surge in commodity prices in early 2008, volatility in US financial markets, and the economic slowdown in developed economies have negatively affected the Philippine economy, with a sharper-than-expected slowdown in GDP growth and a spike in inflation to a 17-year high level in August.

“Despite the negative impact, the Philippine economy has weathered the external shocks well compared to some of our other member economies, and also compared to previous external shocks to the Philippines economy,” said Kelly Bird, an Economist in ADB’s Southeast Asia Department. “This resiliency is due to the government’s commitment to fiscal discipline and key reforms including tax reforms, especially on VAT, the absence of fuel subsidies in the national budget, previous trade reforms and synchronized fiscal and monetary policies.”

The external shocks will challenge the government’s resolve to maintain fiscal and macroeconomic stability and performance. At the same time, it is important to protect spending in the social sectors to help poor and vulnerable families, and achieve the country’s longer term development objectives.

“Responding to the recent developments in the global economy, the second loan addresses these issues through greater flexibility in fiscal policy in 2008 and 2009, further enhancement in tax revenue collection, and support for the government’s conditional and targeted cash transfer program currently piloted as a way to mitigate the worst effects of these shocks to the poor,” Mr. Bird added.

The conditional cash transfer program and broader social protection reforms are important as ADB preliminary research shows only about one third of the poor have access to social assistance.

The DPSP also includes a set of measures to strengthen the investment climate with focus on reducing red tape, support for infrastructure policy and rural development.

A policy and advisory technical assistance grant of $800,000 is included in the loan, to support public expenditure reform initiatives at the Department of Budget and Management. This will be a multi-year exercise over a three-year period.

The third DPSP loan is expected to be processed in 2009 and submitted for ADB Board consideration upon the completion of the second loan.(PinoyPress)

House wants Cha-cha to deal with financial crisis

By Delon Porcalla
Thursday, October 2, 2008

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The US financial crisis has given the administration-dominated Philippine House of Representatives another argument to amend the 21-year-old Constitution by way of giving Americans and Filipino migrants the opportunity to transfer their investments here.

Speaker Prospero Nograles, an ally of President Arroyo in the ruling Lakas-CMD party, said now is the best time to “lift equity restrictions” on the prohibitive 60-40 constitutional provision that favors only local businessmen.

“Now is the best opportunity for the government to encourage US-based Filipinos to invest their dollar-denominated savings in Philippine industries like mining and agriculture,” Nograles said in a statement.

“The trend in the global money market is focused on the more stable gold and other mineral-based investments,” he said in the wake of the current global financial turmoil spawned by the US financial crisis.

The House resolution Nograles authored is now supported by 160 of the 240 congressmen, which may then allow the government to amend the restrictive provision, eventually allowing foreign investments like those from the troubled American market, to come in.

The Arroyo government should take advantage of the situation because US investors are now “relocating to safer grounds.” The Speaker said this is one condition where the Philippines can “convert the US crisis (in)to an opportunity.”

Nograles proposed that the government launch an aggressive campaign to bring in more investments to the Philippines, as US investors are either holding back assets or are re-channeling them to safer grounds.

“Our strong economic fundamentals should be our best selling point in offering refuge to relocating American investments. However, we cannot maximize our potential as an attractive destination because of our equity restrictions,” he said.

Nograles added: “Our economic managers should be able to take the crisis as an opportunity to mobilize the country’s sleeping potentials and not just remain in the defensive posture.

“Overseas Filipinos, especially those working and living in the United States, should look at their home country as the best haven for their savings that could be transformed into active investments,” he stressed.

Nograles surmised that even a minimum of $1,000 investment for every US-based Filipino migrant “would be substantial to fuel the country’s economic engine.”

The Speaker noted that Mindanao is just waiting to be tapped for its rich and vast reservoir of natural resources, including gold and other precious metals, aside from its vast potentials in food production.

According to Nograles, his proposed summit can be used as a vehicle to craft a concrete strategy to attract investments from US-based Filipino migrants and formulate measures that will strengthen investor confidence in the Philippine economy.

He said he is willing to put his job on the line when it comes to Charter change. “In my watch, I think I will bite the bullet,” he told members of the Manila Overseas Press Club early last month.

Nograles assured the MOPC that the 240 members of the House will discuss the issue “in public in a transparent manner, with no surprises, with cards on the table… Let’s see how it goes.”

Members of the Kabalikat ng Malayang Pilipino (Kampi) in the House are not abandoning efforts for Charter change, Interior Secretary Ronaldo Puno said.

Puno, also Kampi chairman, said he and his partymates will continuously push for Cha-cha, but these moves will focus on amendments affecting economic reforms in the country.

Puno highlighted the need for the country to amend constitutional provisions on restrictions on corporate and property ownership.– With Christina Mendez (PStar)

US Senate votes on new bailout

Thursday, October 2, 2008

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WASHINGTON – In a surprise move to resurrect US President George W. Bush’s $700-billion Wall Street rescue plan, Senate leaders scheduled a vote on the measure for Wednesday but added a tax cut plan already rejected by the House of Representatives.

Sen. Harry Reid, leader of the Democratic majority, who sets the Senate agenda, and Republican leader Mitch McConnell disclosed the plan Tuesday. The Senate plan also would raise federal deposit insurance limits to $250,000 from $100,000 per account, as suggested by both presidential nominees a few hours earlier.

The move to add tax legislation – including a set of popular business tax breaks – risked a backlash from House Democrats insisting they be “paid for” with savings elsewhere.

By also adding legislation to prevent more than 20 million middle-class taxpayers from feeling the bite of the alternative minimum tax, the step could build momentum from House Republicans for the Wall Street bailout. The presidential candidates, Sens. John McCain, the Republican, and Democrat Barack Obama, intend to fly to Washington for the votes, as does Sen. Joe Biden of Delaware, the Democratic vice presidential candidate.

The alternative minimum tax was created in the 1970s to bring in money from very rich people who avoided heavy taxes through legal loopholes; inflation and escalation in salaries over the decades have put millions of middle-class wage-earners in the range of the increased tax unless it is changed.

The surprise move to have a Senate vote on Wednesday capped a day in which supporters of the imperiled multibillion-dollar economic rescue fought to bring it back to life, courting reluctant lawmakers with a variety of other sweeteners, including the plan to reassure Americans their bank deposits are safe.

Wall Street, at least, regained hope. The Dow Jones industrials average rose 485 points, one day after a record 778-point plunge after the US House rejected the plan worked out by congressional leaders and the Bush administration.

Before Reid and McConnell’s move, lawmakers, Bush and the two rivals to succeed him all rummaged through ideas new and old, desperately seeking to change a dozen House members’ votes and pass the $700-billion plan.

The tax plan passed the Senate last week, on a 93-2 vote. It included the alternative tax relief, $8 billion in tax relief for those hit by natural disasters in the Midwest, Texas and Louisiana, and some $78 billion in renewable energy incentives and extensions of expiring tax breaks. In a compromise worked out with Republicans, the bill does not pay for the AMT and disaster provisions but does have revenue offsets for part of the energy and extension measures.

That was not enough for the House, which insisted that compensation from other expenses be supplied to offset the energy and extension parts of the package.

The Senate move seems aimed at “jamming” the House into accepting the deficit-financed tax cuts. Conservative Democrats will not like the idea, but some Congress-watchers suspect most Democrats might be willing to go along.

Still, the House is where the problems are, and leaders there were scrounging for ideas that might appeal to a few of the 133 Republicans and 95 Democrats who rejected the proposal on Monday.

Senate Banking Committee Chairman Christopher Dodd, a Democrat, told reporters, “I’m told a number of people who voted ‘no’ yesterday are having serious second thoughts about it.” He added, however, “There’s no game plan that’s been decided.”

The idea drawing the biggest support was to raise the federal deposit insurance limit, now $100,000 per account, to $250,000. Several officials, including presidential nominees John McCain and Barack Obama, endorsed the change.

So did the agency that runs the program.

Within hours of the candidates’ separate statements, Federal Deposit Insurance Corp. chairman Sheila Bair asked Congress for temporary authority to raise the limit by an unspecified amount. That could help ease a crisis of confidence in the banking system, Bair said.

She said the overwhelming majority of banks remain sound but an increase in the cap would help ease a crisis of confidence in the banking system as well as encourage banks to begin more lending.

Other ideas include extending unemployment insurance benefits, typically a Democratic goal, but one that appeals to some Rust Belt Republicans. Another Democratic-backed idea would double the property tax deduction taken by people who do not itemize their taxes. And another calls for more spending on transportation infrastructure projects, which would create more jobs.

Monday’s House vote was a stinging setback to leaders of both parties and to Bush. The administration’s proposal, still the heart of the legislation under consideration, would allow the government to buy bad mortgages and other deficient assets held by troubled financial institutions. If successful, advocates of the plan believe, that would help lift a major weight off the already sputtering national economy.

The proposal ignited furious responses from thousands of Americans, who flooded congressional telephones. The House voted 228-205 against the plan. Some lawmakers reported a shift in constituent calls pouring into their offices Tuesday after the record stock market decline. Many callers, they said, want Congress to do something without “bailing out Wall Street.”

Bush renewed his efforts, speaking with McCain and Obama and making another statement from the White House. “Congress must act,” he declared.

Though stock prices rose, more attention was on credit markets. A special rate that banks charge each other shot higher, further evidence of a tightening of credit availability.

Bush was talking about everyday Americans on Tuesday, not banks or other financial institutions. And no supporters were using the word “bailout.”

The president noted that the maximum $700 billion in the proposed bill was dwarfed by the $1 trillion in lost wealth that resulted from Monday’s stock market plunge.

“The dramatic drop in the stock market that we saw yesterday will have a direct impact on retirement accounts, pension funds and personal savings of millions of our citizens,” Bush said. “And if our nation continues on this course, the economic damage will be painful and lasting.” – AP (PStar)

Gloria: Focus is on insulating RP

PRESIDENT Arroyo yesterday said her economic team is working hard to insulate the country’s economy from the financial crisis in the United States. Arroyo said the economic team is focusing on managing the inflationary pressure to avert any continued hike in prices of commodities, and in sustaining economic growth to “continue to generate jobs and deliver the tax revenues we need to fuel our investment,” She said the government is also strengthening the banking system to improve the fiscal health, encourage investment, sustain the economic growth and insulate the economy from the volatility in the world market. “We have been working hard to make sure that food supplies remain stable. We’re working hard to make sure that there is food on the table of every Filipino. We have also been introducing measures to lift the burden of high fuel prices from our people,” Arroyo said. However, details of the programs were not mentioned. Arroyo convened her economic team Tuesday night in Malacañang to further discuss measures and to assess the impact on the economy of the developments in the US including the rejection of the US House of Representatives on the $700 billion bailout package. Expected to attend the meeting were Budget Secretary Rolando Andaya Jr., Finance Secretary Margarito Teves, Trade Secretary Peter Favila, Bangko Sentral governor Amando Tetangco, Planning Secretary Ralph Recto, Agriculture Secretary Arthur Yap, and Energy Secretary Angelo Reyes. Andaya foresees that if the US Congress continues to reject the bailout plan, the current economic crisis could worsen and be far worse than the Asian financial crisis of 1997. He said this would mean among others, that the interest rates would go up and exports would shrink. The US is the biggest trading partner of the Philippines. “Mas concern namin kung ano ang effect. What will be the negative effects if a bailout does not materialize? Of course, down the line new taxes would be one of the options,’ he said. Sen. Mar Roxas called on the Bangko Sentral, the DOF and other government financial institutions not to keep the public “out of the loop” about the unraveling global financial crisis. “Lack of information only causes uncertainty among the public. As long as the BSP and DOF communicate clearly with the people – from sophisticated investors to ordinary depositors – we are containing speculation,” he said. Roxas, chair of the committee on trade and commerce, said more importantly, the economic managers must take stock of any impact of the financial crisis on the real economy, which may happen within a few months unless plans to plug these are put in place. Roxas said that instead of panicking or taking imprudent actions, the government and private sector institutions should take this challenge as an opportunity to plan strategically for the future. “We already know that global markets are changing in an increasingly dynamic and interconnected way. We all know that we cannot be in ‘business-as-usual’ mode forever,” he said. – Jocelyn Montemayor (Malaya) ====================== My Take: What’s the detail? Just asking.

Editorial Cartoon: Super Hero

And abused

ADB’s Outlook for Asia: Slowdown in Growth, Sharp Rise in Inflation

HONG KONG, CHINA – Developing Asian economies will revert to a more moderate growth outlook of 7.5% this year and 7.2% next year after posting its fastest growth of 9% in nearly two decades in 2007, the Asian Development Bank (ADB) says in a new major report.

The Asian Development Outlook 2008 Update (ADO Update) also warns that inflationary pressures in the region are mounting and could boil over if left unaddressed.

The report projects an inflation rate of 7.8% in 2008 in Asia and the Pacific, up from an earlier estimate of 5.1%. In 2009, inflation could reach 6.0%.

Clouding the outlook for the region, the report notes, are the continued elevated level of international oil and food prices, the persistence of high inflation, and a prolonged slowdown in industrial countries.

The report highlights that a supply shortage will remain a dominant issue in global commodity markets.

“While oil prices are likely to soften somewhat in the short run, they will remain high and volatile in the long run. High oil prices are here to stay. And as food prices are heavily influenced by oil prices, high food prices are here to stay as well,” says Ifzal Ali, Chief Economist of the Manila-based multilateral development bank.

The report also warns that the inflation spike now seen throughout developing Asia cannot be blamed solely on cost-push factors, such as high global commodity prices. Analysis in the ADO Update shows that demand-pull factors, in particular excess aggregate demand and inflation expectations, account for a larger share of variations in domestic price inflation.

“The impact of high food and oil prices on inflation has been muted in most of Asia,” says Mr. Ali. “This central finding has vast implications for monetary policies in the region. In particular, it means that monetary tightening will continue to be a principal instrument for fighting inflation in Asia. It’s time to tighten our belts and for governments to cut subsidies, on fuel for example, that have shielded consumers from the brunt of the increases. These subsidies are not sustainable. When the subsidies are removed, renewed upward pressure will commence and will raise inflation.”

The ADO Update urges developing Asian economies to address rising inflation even at the expense of slower growth, adding that the region must learn to adjust to high commodity prices.

The report also recognizes that the regional outlook remains tied to the fortunes of industrial countries.

“Uncoupling is a myth,” says Mr. Ali. “Our study shows that the region still depends on industrial countries to fuel its growth. If the global slowdown extends beyond 2009, the repercussions for the region could be severe.”

Overall, the report concludes, the key to fulfilling the region’s enormous potential is the speed and success by which macroeconomic stability is restored and requisite structural reforms are adopted.(PinoyPress)

Probe Eyed on Banks’ Outsourcing

MANILA — Saying that the outsourcing of banking functions has led to the displacement of thousands of bank employees, Anakpawis party-list Representative Rafael Mariano today urged the House Committee on Labor and Employment to immediately conduct an inquiry into the legal basis of Bangko Sentral ng Pilipinas-issued circulars that allowed the outsourcing of banking functions.

House Resolution 757 filed by Mariano seeks to determine the impact of BSP Circular No. 268 and succeeding circulars which allowed the outsourcing of banking functions and determine its impacts on the security of tenure of bank and financial institution employees and come up with policy recommendations to delineate the powers of the BSP and protect the rights of employees to job security.

The BSP issued Circular No. 268 on December 5, 2000 which allowed the outsourcing of bank functions such as IT Systems/Processing, Data Imaging, Storage and Retrieval, Clearing and Processing of Checks, Printing of Bank Deposit Statements, Credit Card Services, Printing of Bank Loan Statements, Credit Investigation and Collection, Processing of Export, Import and Other Trading Transactions, Messengerial, Courier and Postal Services, Security Guard Services and Vehicle Service Contracts.

“Instead of generating jobs and protecting bank employees’ right to job security, BSP Circular No. 268 would lead to the dislocation of bank employees,” Mariano said.

HR 757 cited that the “BSP issued succeeding circulars that widened the scope of banking functions that may be outsourced, endangering the job security of thousand of regular bank and financial institution employees.”

It said that “Section 55.1 (e) of Republic Act No. 8791 or the General Banking Act which was cited by the BSP as the basis of issuing these circulars, does not say anything that allows contractualization of the
enumerated banking functions.”

“The banking functions enumerated in the circulars are considered core job positions and must not be contractualized based on Department of Labor and Employment’s Order No. 18-02 (D.O. No. 18-02) which states that jobs that are usually necessary and desirable in the usual trade or business cannot be contracted out.”

“Outsourcing these banking functions has led to the displacement of thousand of bank employees and therefore violated the provision stated in D.O. No. 18-02 that contractualization cannot be carried out if it will cause the displacement of regular rank-and-file employees,” Mariano said in HR 757.

Mariano, along with Bayan Muna party-list Reps. Satur Ocampo and Teodoro Casino, Gabriela Reps. Liza Maza and Luzviminda Ilagan, said that “there is a need to inquire whether or not the BSP is usurping
the powers of the legislature in issuing the circulars.”

“The said circulars are affecting some of the country’s largest banking institutions like Philippine National Bank (PNB), Bank of Philippine Islands (BPI), Rizal Commercial Banking Corporation (RCBC), Planters Bank, Veterans Bank and others. Based on the said circulars, it would appear that the remaining functions that cannot be outsourced are managerial functions,” the resolution said.

The resolution also stressed that “the continuing implementation of the circulars on outsourcing of banking functions gravely affects the right of bank employees on security of tenure, right to organization and right to collectively assert their demands for higher wages and benefits.”

Mariano also said that “aside from infringing job security of bank employees, the practice of outsourcing core bank functions and operations violates the Republic Act No. 1405 or Bank Deposits’ Secrecy Law.

The Bank Deposits’ Secrecy Law states that “all deposits of whatever nature with banks in the Philippines, including investments in government bonds, as of an absolutely confidential nature and prohibits the examination or inquiry into such deposits or investments by any person, government official, bureau or office, as well as the disclosure by any official or employee of a bank of any information concerning said deposits.”

Banking and Financial Unions, an association of unions of bank employees, has filed a petition signed by thousands of bank employees, against BSP Circular 268 before the BSP.

“The BSP has refused to recall the circulars it had issued on outsourcing amidst the petition submitted by the Banking and Financial Unions against BSP Circular 268 on July 18, 2008,” the resolution said.

Survey Says…!

The Arroyo government is running out of excuses as one survey after another shows the deteriorating state of the economy and the quality of life of the Filipino people.

BY BENJIE OLIVEROS
ANALYSIS
Bulatlat
Vol. VIII, No. 27, August 10-16, 2008

The Arroyo government is ranting over the results of recent surveys: from the Social Weather Station (SWS) survey showing that Gloria Macapagal-Arroyo’s satisfactory rating plunged to -38, to the Pulse Asia survey showing that 40 percent of the people do not believe in the truthfulness of the state of the nation address, while 46 percent are undecided.  But the most damning surveys are the ones on hunger by the SWS, which showed that an increasing number of people have experienced severe hunger, 4.2 percent or 760,000 families, and that overall hunger statistics showing 2.9 million Filipino families experiencing involuntary hunger are still above the ten-year average; and the July survey of Pulse Asia showing that 75 percent of Filipinos feel that their life is worse off now than a year before, 64 percent being pessimistic about their personal circumstances, and 86 percent saying that the national economy has worsened in the last three years.

The Arroyo government brushed aside the president’s unsatisfactory rating by saying that it has made unpopular but necessary decisions.  It ignored the survey regarding the credibility of the SONA and merely pleaded for people to listen.  It responded to the results of the hunger survey by blaming the international market for the spike in oil and food prices; and saying that it has been distributing subsidies to help the poor to tide it over under these difficult times.

But the government began to complain when the results of the latest survey of Pulse Asia was released.  The survey conducted from July 1-14 revealed that 66 percent or two in every three households are spending less on food to be able to make their budget fit for their daily needs. Of these, 24 percent has been reducing their rice consumption and spending while 55 percent has been limiting their expenditures on other food items.

Press Sec. Jesus Dureza said he was not convinced that the 1,200 respondents represent the feelings of 80 million Filipinos.  If survey and statistical standards do not apply then we might as well forget what we learned in college.

The results of the Pulse Asia survey are not surprising  Contrary to Malacañang’s claims, the results of the survey may even be conservative.

World Bank computes the percentage of the food budget to income at 50 to 70 percent.  Based on the Family Income and Expenditure Survey (FIES) of the National Statistics Office, 80 percent of Filipino families are struggling to survive on P284.33 ($6.41 at an exchange rate of $1=P44.34) a day; and with an average family size of five, this translates into 68.2 million Filipinos subsisting on P56.87 ($1.28) a day.  If these families allot 70 percent of their income to food, that means P 39.809 ($0.897) is budgeted per person for three meals.  Only P17.06 ($0.38) is left for transportation and other expenses such as communications, clothing and footwear, education, personal care items, fuel, light, water, and rent. The P17.06 ($0.38) budget for these is only enough for a four-kilometer jeepney ride back and forth.

Even if we take the results of the FIES, which concluded that only 42.6 percent of the family income is allocated for food, it would still not be enough.  If only 42.6 percent of the family’s income or a meager P121 ($2.728) is, on the average, spent on food for five people then P 163 ($3.676) per day or P4,890 ($110.28) per month is budgeted for transportation and communications, clothing and footwear, education, personal care, fuel, light, and water, and rent.  More or less one half of this would already be eaten up by expenses for transportation alone, that is, if all the five members of the family do not travel beyond four kilometers from their house.  If the workplace of the parents and the school of the children are beyond four kilometers, all the remaining budget of the family would be spent for transport fare.

With the skyrocketing prices of basic goods and services and the free falling of the real income of families, the only item left for the 80 percent of the population to scrimp on is food as too little is already allotted for other essentials.

But the people are scrimping on food that is already insufficient.  The P39.809  ($0.897) per person for three meals is only about P13.26 ($0.30) per meal.  Even food prepared from “pagpag” (literally to dust off) or recycled left-over food retrieved from waste bins costs P10 ($0.225) already in urban poor communities. It is worse if only P121 ($2.728) per day is spent on food, if we are to base the computation on the results of the FIES, which claims that only 42.6 percent on the average is allotted for food.  This translates to a meager P24.20 ($0.545) per person per day or P 8 ($0.18) per person per meal.  What the FIES did is to average the food expenditures of all Filipino families.  But as one’s income decreases, the percentage of income spent on food increases.

The justification that there is nothing the government can do because the spike in prices is international in nature is a falsehood.  Even the World Bank, the main promoter of globalization and the “free market” said in a study entitled, “The Impact of Food Inflation on Urban Poverty and its Monetary Cost: Some Back-of-the Envelope Calculations”, that “The relationship between international and domestic food prices is country-specific. The transmission of high world prices to domestic prices depends on the depth of international markets for different commodities, countries’ exchange rates variations against the US dollar during the period, the degree of openness of the different economies  and domestic policies in response to the shock. Domestic relative food prices are affected by inflation of non-food prices, which also varies by country.”

Of course, what the World Bank is not saying is that the more open an economy is, and the more dependent it is on imports, the greater is the country’s vulnerability to increases in prices in the international market. That is why the Philippines, which is highly dependent on imports of oil and rice, among other things, is being rocked by the spike in international prices of these commodities. Nevertheless, the World Bank admits that domestic policies impact on local prices. This belies the claim of the Arroyo government that it is not to blame for the spike in prices and that it has been making necessary, though unpopular decisions.

The truth is the Arroyo government is running out of excuses as one survey after another shows the deteriorating state of the economy and the quality of life of the Filipino people. Bulatlat

Economics and Society 101: Dismal state of the nation

By ARTURO BOQUIREN

Several years from now, our sons and daughters (grandsons and granddaughters for others) would ask: if the GMA government is corrupt and a cheat, how come the Filipino people failed to replace the Arroyo government with a better one?

We will probably look for scapegoats.

Eventually, however, we will run out of scapegoats and we will have no one to blame but ourselves. Our children or grandchildren will realize that we did not do our best or that our best had not been good enough for that required given the sign of the times today.

Official statistics place Philippine poverty at roughly 30% of the population. Progressives croon that the data are massaged figures but I think the main point really is that Philippine poverty has persisted when there should be no poverty in the 21st century given the world’s wealth. Poverty rates in neighboring countries are as low as 5%. Further, the pace of poverty reduction in the Philippines has been one of the slowest in the world.

While neighboring countries with similar situations have been able to reduce poverty by as much as 2% annually, the Philippines have only managed to do so at only 0.7% per annum. South Korea, for instance, is commonly believed to be poorer than the Philippines in the 1950s, but today poverty rate in South Korea is only 5% versus the Philippines’ 30%.

Worse, the top 20% of the Philippine population continues to control at least 50% of national income.

Infectious diseases continue to be among the leading causes of morbidity and mortality, confirming the impact of poverty to health figures.

Our country continues to be dominated by foreign interests and this dominance is facilitated and perpetuated by the World Trade Organization. Production basically responds to foreign or world demand. Economic direction does not exist except that dictated by the world market. In contrast, nations that are developed today have crafted their economic direction independent of the demands of the international market.

Our social system continues to be semi-feudal. As reported by this column earlier, 26% of the farmer-beneficiaries under the government’s land reform program were reported by the press to have sold their land. Three out of four farmer- beneficiaries under the program do not receive government support and are forced to borrow with interest rates as high as 24%.

Around 40% of the farmer-beneficiaries were even reported to have abandoned farming because of feudal and semi-feudal difficulties.

Our democracy continues to be a farce. Even if people power is able to change the leadership of the government now, the elite and their agents continually sabotage the government’s full transformation into a state of the people.

This is what had happened to the Corazon Aquino government. The same thing happened when we replaced the Estrada government with the Arroyo government.

The lesson of history: never trust an individual, trust only the collective. People power is never handed on a silver platter or by a few days of struggle, it is something continuously created and maintained. The people’s continuing militance and organization are among the most important for people power to be sustained.

Will our country belong to the richest nations of the world at some time in the future as GMA says? Is this true? No. What GMA is saying is simply a sham. Hogwash.

At the current rates, we will not belong to the richest nations of the world because our neighbors are growing faster than us. Besides, several social indicators have remained steady for the last several decades and Philippine society continues to be a social volcano. This volcano is very small at the top but very big at the base.

Few can make ends meet and the larger base have no food for the current or the next meal.

The social volcano is bound to explode soon and we must offer our people a fresh start, a viable program of action, and a forward-looking future. We must be patient and prepare ourselves for that day. We must continue to organize and consolidate our strength now.

We must continue to build our nation’s future today. #

(The writer maintains a blog at http://www.geocities.com/arturoboquiren. Comments can be coursed through http://www.nordis.net, artboquiren2040@yahoo.com and +63927-536-8431)

(NorDis)

QC Biz District to Dislocate Gov’t Offices, Employees

As the Quezon City Central Business District (QC-CBD) project pushes through, government employees fear possible dislocation.

BY NOEL SALES BARCELONA
Bulatlat
Volume VIII, Number 26, August 3 – 9, 2008

More than 100 employees of the Department of Agriculture (DA), and the Department of Environment and Natural Resources (DENR) flocked to the DA Central Office in Quezon City, August 1 to protest the proposed transfer of the DA office to Isabela province (approx. 370 kilometers, north of Manila).

They were joined by members of Anakpawis party-list (Toiling Masses), Kilusang Mayo Uno (May First Movement or KMU), Kalipunan ng Damayang Mahihirap (Alliance for the Welfare of the Poor or Kadamay).

DA Employees Association (DAEA) President Joven Daculada said that if not for the proposed Quezon City Central Business District (QC-CBD), the land where the current DA office is standing, would not be for sale.

The Office of the Agriculture Secretary alone has 800 employees. If the attached agencies or bureaus are to be included, the DA has 8,000 employees.

QC-CBD

The QC-CBD is a pet project not only by the Quezon City government but also by Malacañang.

Mrs. Gloria Macapagal-Arroyo signed on May 4, 2007 Executive Order (EO) No. 670 or the Rationalizing and Speeding Up the Development of the East and North Triangles, and the Veterans Memorial Area of Quezon City, as a Well-planned, Integrated and Environmentally Balanced Mixed-use Development Model to give way to the creation of the QC-CBD.

The said E.O. has been amended by E.O. 670-A, on September 11, 2007, expanding the membership of the Commission that is tasked to supervise the implementation of the project.

Vice President Noli de Castro chairs the Urban Triangle Development Commission or the TriDev Commission. De Castro is also the current chairman of the Housing and Urban Development Coordinating Council (HUDCC). Quezon City Mayor Feliciano Belmonte Jr. is the Commission’s vice chairperson.

After the creation the TriDev Commission, the World Bank released P3 billion (US$67.737 million) to finance the study of how the 250.6 hectares of land, covering the East and North Triangles and the land owned by the Veterans Memorial Medical Center can be developed.

Although not earlier included in the project, a 90-hectare land owned by the University of the Philippines (UP) is now being developed into a business process outsourcing haven.

Part of the “developing team” are Jaime Augusto Zobel de Ayala, Henry Sy Sr., Andrew Tan, Lucio Tan and John Gokongwei Jr., all are known real estate developers and business tycoons.

As an opening salvo, the Ayala Land had already poured $76 million for building its Trinoma Mall in the land used to be owned by the national government and $130 million for the development of the Science and Technology Park in UP.

Affecting all government offices

Ferdinand Gaite, president of the Confederation for Unity, Recognition and Advancement of Government Employees (COURAGE) disclosed that it is not only the DA that will be transferred but also other government offices.

In an interview, Lori Bangalisan, president of the Bureau of Animal Industry Employees Association, said, “We don’t believe that the attached agencies of the DA will not be transferred. Where the mother hen is, the chicks will be.”

Gaite said that the Department of Agrarian Reform may be transferred to Davao and the Golden Acres, a hospice for the elderly being managed by the Department of Social Welfare and Development will be moved to Taguig.

“The government is very much willing to sacrifice the precious service to the Filipino people to expedite the sale of these prime lands at bargain prices, for quick bucks for Arroyo and Quezon City government officials and for the benefit of big businesses,” Gaite said.

Some parts of the Ninoy Aquino Parks and Wildlife, being managed by Department of Environment and Natural Resources (DENR), are said to be up for sale to give way for the QC-CBD development.

Earlier, Contra-CBD (Concerned Organizations opposed to Transfer, Layoff and Privatization for the Central Business District) was formed by different unions under COURAGE, by the Alliance of Health Workers and the communities affected by the project, to oppose what they call as an “anti-people” project. Bulatlat

Economics and Society 101: On the results of NEDA study on autonomy

By ARTURO BOQUIREN

A few days ago in the University of the Cordilleras, Executive Director Juan Ngalob of the National Economic Development Authority-Cordillera Administrative Region (NEDA-CAR) reported the findings of a survey done about a year ago.

The survey covered a few thousand respondents, 2,809 to be exact, and is supposedly representative of the pulse of the voting age population of the Cordillera. Ngalob claims that random sampling or a type of random sampling was used.

The survey is supposedly 95% accurate within a small margin of error. The salient points on the survey on the respondents:

• 57.5% are aware of the constitutional provision for the creation of an autonomous region in the Cordilleras • 51.8% understand autonomy as involving self-government • 30.0% believe that autonomy involves owning and controlling resources • 23.9% agree that autonomy is generating and utilizing one’s financial resources • 11.0% believe that autonomy is enacting and enforcing own laws • 9.2% expressed that autonomy is synonymous to “self-determination” • only 16.9% expressed that they have no notion of autonomy • 64% are not aware of the legislative powers of the proposed autonomous government under the plebiscites earlier conducted on Cordillera regional autonomy • 65.9% believe that the proposed organic acts of the past were rejected because people did not understand the content of the organic acts • 73.1% favor the creation of a Cordillera region • 30.5% believe that the Cordillera is not yet ready for autonomy while 28.7% expressed with certainty that the Cordillera is ready for autonomy • asked on what must be done after the failure of the two plebiscites on Cordillera regional autonomy, only 7.5% expressed that they are not in favor of autonomy or do not see any need for the region to become autonomous

Based on the above, it is easy to see that the call for regional autonomy continues to find strong support in the Cordillera. There may be disunities what would constitute autonomy or on whether the Cordillera is immediately ready for autonomy. Nevertheless, there is a strong support for Cordillera autonomy whether or not that autonomy is to be realized now or in the long term.

The view of this column is that “readiness” is a function of governance. More precisely, it is a function of government support. Government must support, or more accurately, work for the realization of autonomy. The provision of Cordillera regional autonomy is a constitutional task of government in the first place. The realization of Cordillera autonomy is required under the constitution.

There is no legal obstacle government to grant Cordillera interim regional autonomy. Of course, Philippine laws require the organic act to be submitted to a plebiscite but there is no legal obstacle for government to realize autonomy even before the enactment of an organic act generally acceptable to Cordillera people. Thus, there is the option of providing interim autonomy even before an organic act generally acceptable to Cordillerans is formulated. Of course, the autonomy will be “fake.” But it can be a “fake” one because it is interim in the first place. Even as interim autonomy is granted, government must continue to be at the forefront of working for an organic act that is generally acceptable to the Cordillerans.

Hence, government must lead by working for or implementing an interim regional autonomous government while continuing its work towards the creation of an organic act that is generally acceptable to Cordillerans.

Is government really sincere in realizing autonomy? I do not think so. Government is shortcutting processes on obtaining a free and informed consent on development projects, including those on mining. When people are confronted with big mining corporations, mining projects are still implemented even with the opposition of the people.

I would not even be surprised if some form of autonomy or display of a so-called free-and-prior-informed-consent (FPIC) would be invoked by government to facilitate the exploitation of resources in the Cordillera at the expense of Cordillerans themselves and their brother Filipinos in the lowlands. Thus, even if I express openness to interim autonomy as genuine autonomy is worked for, I am also aware that pseudo-autonomy or interim autonomy can be used as cover for exploitation and oppression.

At the local level, even if there are funds for the conduct of actions related to autonomy, the funds are not utilized. The funds are even so little and yet not used optimally. NEDA-CAR must improve its performance on this matter. For instance, according to sources, a measly P33 million was allocated by the national government related to Cordillera autonomy for a number of years but an even smaller P5 million were spent so far and the spending was not even transparent. Whew! #

(The writer maintains a blog at http://www.geocities.cim/arturoboquiren. Comments can be coursed through http://www.nordis.net, artboquiren2040@yahoo.com, and +63927-536-8431)

Duterte will ask rebels to stop harassing traders

MAYOR RODRIGO Duterte will ask the leadership of the New People’s Army (NPA) to stop harassing  businesses in the city.
In a consultation with members of the business sector, Duterte admitted the rebels have intensified their activities in relation to its revolutionary tax activities to get more funds for their operations.
However, the mayor said he could not discuss with the rebels, particularly the Pulang Bagani Command 1 under Leoncio Pitao alias Kumander Parago. The mayor used to meet Parago.
“I can’t talk to them about policies. I have to go up to the Commission in Mindanao – their pulit-buro,” he said. But Duterte said his efforts could only reach a certain level because it is a nationwide concern which the national government must address.
He said the activities of the NPA and those of other groups are beyond his control. Had they been criminals, he could “eradicate them in 24 hours,” he said, although he added there are rules to be followed
“The NPAs, I can’t control them including terrorists. I can’t solve it myself. I can only take care of the criminals,” he added.
Duterte said the government could not also harm the members of the rebel movement who are in the legal fronts or those in the “white area.” He said doing this would change the equation and would make the city once again as a killing field.
Simeon Marfori II, Davao City Chamber of Commerce and Industry president, said the business sector is grateful that the city government has been pushing for the peace and order situation to be maintained. He said because of this they were able to thrive well in the city.
Marfori said they are willing to cooperate with Duterte in keeping the good climate of the city especially with the recent attacks of NPA which could greatly affect the city’s image.
He said investors will most likely shy away in investing here if a lot of security and peace and order problems are being disseminated.
The recent attack of the group was last Wednesday night in Tigatto, Buhangin District where the member’s of Parago’s group burned four heavy dump trucks and two heavy equipment owned by Lapanday Development Corporation. The report of the military said the 15-men group also strafed the hangar of the company.(MindanaoTimes)

Editorial Cartoon: Yes, Ramdam ang Kaunlaran!

See them clapping…

RP among the world’s richest in 20 years

BAGUIO CITY — Pres. Gloria Macapagal-Arroyo announced here Friday the merger of two political parties would deliver the country into a First World status in the next generation.

In a sheer display of her savvy as the country’s top official economist, GMA told Lakas-CMD and KAMPI affiliated elective officials of Cordillera the economy would continue to improve and the country “will be counted among the rich nations in 20 years, if we maintain our solidarity.”

GMA keynoted the merger in the region of two of her allied parties which she considers the “strongest political parties today.”

Better than the rest in Asia

In her attempt to clarify the food crisis and the skyrocketing price of prime commodities, GMA cited the situation of Asian countries, which are also “hit by the world spikes in fuel and food prices and the slowing down Western economies.”

She said rice and oil prices are higher in these countries than the Philippines’ P35 per kilo and P55.90 per liter, respectively.

According to the president, rice in India is P95/kilo while in Singapore it is P45. She added oil is P71 per liter in Hong Kong, P67 in New Zealand, and P60 in Thailand and the US.

International speculation

Last week, Dr. Carol Araullo of Bagong Alyansang Makabayan (Bayan) who spoke in a forum here, said rice prices are soaring in the Philippines because of “commodity futures market,” which she said has affected many of the world’s developed and developing economies.

Similarly, the prices of oil are also affected by the dynamics of speculation, which is responsible in the bloated prices.

The independent think-tank IBON Foundation, in a Bulatlat.com story, revealed that world oil prices are bloated by speculation in oil markets and local firms Petron, Shell, and Chevron Philippines, which are domestic agents of the global oil monopolies, are passing on this overpricing to consumers.

IBON calculated that over 20% of local pump prices are due to speculation-driven overpricing.

According to Araullo, the oil and rice crises are but part of the empty promises of globalization, which in itself manifests the crisis of a rotting imperialist system.

Poor

Government statistics show a worsening picture of poverty in most regions, and the president has been quoted saying the effects of an improving economy has not yet trickled down on the poor.

A family of five in the National Capital Region has to earn P10,000 a month to live out of poverty, according to the National Statistics Coordination Board (NSCB). In the Cordillera, a family of five would need at least P7,000 monthly in order not to be considered poor.

Earlier, in a press conference NSCB Cordillera calculated that all one needs in order not to be considered poor is P45 daily. This, however, was criticized by urban poor groups, saying a meal in a college canteen here costs P44.

Double-digit inflation

While GMA boasted of an improving economy, the value of the Philippine peso continues to fluctuate in recent months. The peso-dollar exchange rate is now P45.03 as of Friday, which Arroyo claimed to be going strong citing that in the past it used to be P56 to a US dollar. The country’s inflation rate is expected to hit a double-digit and is seen to persist up to the first quarter of 2009, according to government finance institutions.

The Bangko Sentral ng Pilipinas (BSP) has reportedly raised its inflation forecast for 2008 at 9 to 11 %. This is simply seen in the rapidly rising cost of consumer goods.

GMA promptly said, “We should get ready for the day when we shall be a part of the First World,” as she ended her keynote address. # Lyn V. Ramo(NorDis)

Salbabida ng ekonomiya, sagana sa pagpapabaya

Soliman A. Santos

MAY panawagan ang mga migranteng Pilipino kay Pangulong Arroyo sa darating na Sona (State of the nation address): Huwag silang gamitin. Huwag gamitin ang kanilang remitans, ang kanilang kalagayan, buhay at kamatayan para sa sarili nitong kapakanan.

Binalaan ng Migrante International si Pangulong Arroyo na huwag gamitin ang komutasyon ng hatol na kamatayan kay May Vecina, isang OFW (Overseas Filipino Worker) sa Kuwait. Hinatulan ng kamatayan si Vecina sa kasong pagpatay sa anak ng kanyang amo noong nakaraang taon subalit nitong Hulyo 8, ibinaba ng Emir ng Kuwait ang hatol sa habambuhay na pagkabilanggo.

Ayon kay Gary Martinez, tagapagsalita ng Migrante, tagumpay ito ng pamilya ni Vecina at ng iba pang OFW na nangampanya para sa buhay ni Vecina.

Binatikos naman ni Martinez si Pangulong Arroyo at ang kanyang mga opisyal sa embahada dahil pinabayaan umano ng mga ito si Vecina na makulong sa loob nang mahabang panahon. Idinagdag ni Martinez na hindi pa mapapansin ng publiko ang kaso ni Vecina kung hindi nananawagan ang mga kapwa nito OFW.

“Libu-libong OFW na nasa hindi magandang kalagayan ang makapagpapatunay sa kriminal na kapabayaan ng gobyernong Arroyo sa mga OFW. Binabalaan namin siya na huwag niyang gawing trophy sa kanyang Sona si Vecina at ang mga OFW,” ani Martinez.

Bilyong dolyar na industriya

Laging ipinagmamalaki ng gobyernong Arroyo na malaking tulong sa ekonomiya ng bansa ang mga remitans na ipinadadala ng mga OFWs. Batay sa ulat ng Bangko Sentral, umabot na sa $1.4 Bilyon ang remitans ng mga OFWs noong Mayo, mataas ng 15.6 porsiyento noong nakaraang taon.

Subalit para sa mga OFW, hindi nila maintindihan ang ipinagmamalaking “maunlad na ekonomiya” na ipinangangalandakan ni Pangulong Arroyo at ng kanyang mga ekonomista. Para sa Migrante, kabilang sila sa mga tinatamaan ng hagupit ng ipinagmamalaking “malakas na piso”.

Sa kabila nito, ginagawa pang “gatasan” hindi lamang ng gobyerno, kundi pati ng mga pribadong bangko at mga kompanya ang remitans ng mga OFWs.

Ang pagpapadala ng remitans ay naging isa nang bilyong dolyar na industriya. Lalo pang nadagdagan ang mga buwis at serbisyong pang-remitans ng gobyerno, pribadong mga bangko, telekomunikasyon, pati na rin ang mga insurance business.

Ipinakikita ng inisyal na pag-aaral ng Migrante na sa bawat $200 na remitans na ipinadadala kada buwan, hindi bababa sa $15-22 ang ipinapataw bilang bayad serbisyo. Sa sampung milyong OFW na nagpapadala ng remitans, tumataginting na $1-B ang kinikita ng mga bangko buwan-buwan.

Sa kabilang banda, hindi lamang ginagamit ng gobyerno ang bilyong dolyar na remitans para sagipin ang ekonomiya kundi direkta pa itong nakikinabang sa mga buwis na ipinapataw sa remitans, tulad ng 0.15% documentary stamp tax sa kada transaksiyon. Sa kada bilyong dolyar na nareremit buwan-buwan, nakakakolekta ang gobyerno ng tinatayang $1.5 Milyon o P62-M. Hiwalay pa ito sa iba pang bayarin na kinakaltas sa mga OFWs bago pa man sila makaalis ng bansa.

At habang dambuhalang kita ang nakukuha ng gobyerno at mga pribadong negosyo, halos wala namang natitira sa mga OFW at kanilang pamilya. Ang $200 na tinatanggap ng mga pamilya ng OFW kada buwan ay lumiliit at patuloy pang lumiliit ang halaga dahil sa patuloy na pagtaas ng presyo ng mga pangunahing bilihin at serbisyo.

Hindi umano alam ng administrasyong Arroyo na dinadanas ng mga OFW at kanilang pamilya ang pagbaba ng kanilang purchasing power dahil sa pagtaas ng halaga ng piso kontra dolyar.

“Ang mga bayaring ito ay sumisipsip sa dugo, pawis at luha ng mga OFW, kaya makatuwiran lamang na tanggalin ang mga ito,” ayon kay Martinez.

Walang malinaw na polisiya

Patunay rin umano ng kapabayaan ng gobyernong Arroyo sa kalagayan ng mga OFW ang kawalan nito ng malinaw na polisiya sa napipinto na namang malawakang deportasyon ng libu-libong OFW mula sa iba’t ibang bansa.

Ayon sa Migrante, libu-libong OFW ang maaaresto, makukulong, lilitisin at idedeport dahil sa malawakang crackdown sa mga di-dokumentadong manggagawa na isinasagawa ng mga bansang EU (European Union), Malaysia at South Korea.

Nais ng Migrante na lumikha ng task force ang gobyerno para masigurong hindi malalabag ang karapatan ng mga OFW sa proseso ng crackdown.

“Dapat nang umaksiyon ang gobyerno sa pamamagitan ng dipomatikong paraan sa ngalan ng mga OFW,” ayon kay Connie Bragas-Regalado, tagapangulo ng Migrante.

Binatikos pa ni Regalado ang isang opisyal ng Department of Foreign Affairs dahil sa pahayag nitong “may karapatan ang bawat bansa na ideport ang mga di-dokumentadong dayuhan.” Aniya pa, napakalayo ng pahayag ni Undersecretary for Migrant Workers Affairs Esteban Conejos Jr. sa mga lider ng mga bansa sa Central America na agad na nanindigan para sa kanilang mga mamamayan at bumatikos sa crackdown.

Inilarawan ni Regalado bilang ng malawakang crackdown bilang “napipintong kalamidad” dahil sa hirap ng buhay na kinakaharap ng maraming pamilyang Pilipino.

“Ang napipintong deportasyon ay walang dudang di-makatao. Krimen para sa gobyernong Arroyo na hindi pansinin ang bagay na ito,” ani Regalado.

Sa South Korea pa lamang, tinatayang 30,000 di-dokumentadong Pilipino ang madedeport dahil sa crackdown.

Kamakailan lamang inaprubahan naman ng EU ang isang batas na naglalayong palayasin sa kanilang mga bansa ang di-dokumentadong mga migrante. Ayon sa Migrante, mahigit 100,000 di-dokumentadong Piipino ang nananahan sa Europa.

Halos kalahating milyong Pilipino naman sa Malaysia ang posibleng maaresto, makulong at madeport .

Nangangamba ang Migrante na baka maulit ang malagim na crackdown sa Malaysia noong 2005, kung saan kumuha pa ng 560,000 volunteer ang gobyerno ng Malaysia para ipatupad ang crackdown. Nagbigay rin umano ng 80 ringgits ang gobyerno bilang kabayaran sa mga volunteer at 100 ringgits sa bawat maaarestong di-dokumentadong manggagawa.

“Ang crackdown ay bukas sa pang-aabuso ng awtoridad at maaaring malabag ang karapatan ng mga migrante,” ani Regalado.

Sa halip na ipagmalaki ni Pangulong Arroyo ang tulong ng mga OFW sa ekonomiya ng bansa sa kanyang Sona, hiling nilang bigyang-pansin ang kanilang mahirap na kalagayan makapagpadala lamang ng kaunting halaga para matulungan ang kanilang mga pamilya.

Isang paraang nais ng Migrante na gawin ng gobyerno ay tanggalin ang mga bayarin sa pagpapadala ng remitans na nagdagdag pa umano sa hirap ng mga OFW. Bukod dito, ayaw na nilang maranasan ang di-makataong crackdown. Ayaw na nilang maulit pa ang mga nangyayari sa isang tulad ni May Vecina.(PWeekly)