PHILIPPINE HEADLINE NEWS ONLINE: Since 1997 © Copyright (PHNO) http://newsflash.org



BUSINESS HEADLINES THIS PAST WEEK...
(Mini Reads followed by Full Reports below)

GOVERNMENT TIGHTENS AUDIT STANDARDS FOR MINERS


JULY 14 -MGB director Leo Jasareno said Environment Secretary Gina Lopez wanted to raise the bar on responsible mining in the country with a stricter set of criteria in the audit of around 105 metallic and non-metallic mines nationwide, including quarrying and small-scale mining. AP Photo/David Goldman The Mines and Geosciences Bureau (MGB) has imposed stricter audit standards for mining companies as part of efforts to put a stop to irresponsible mining. MGB director Leo Jasareno said Environment Secretary Gina Lopez wanted to raise the bar on responsible mining in the country with a stricter set of criteria in the audit of around 105 metallic and non-metallic mines nationwide, including quarrying and small-scale mining. “The comprehensive review will focus on the companies’ compliance with the requirements of the Mining Act of 1995, Environmental Compliance Certificate, Forestry Law, and other laws pertaining to mining. We want to see whether a specific violation will entail suspension of operations,” Jasareno said. He added that the new round of audit would look beyond regulatory requirements such as the social and economic impact of the mining operations nationwide. Based on the initial review on mining companies, the MGB chief confirmed there were frequent violators of mining rules and regulations. “You’ll be surprised with the number of companies violating the conditions of their contract, majority of which were slapped with equivalent amount of penalty depending on the discretion of who conducted the review,” Jasareno said. “With the new round of audit. There will be a list of criteria they need to comply with, otherwise they may face suspension,” he added. READ MORE...

ALSO: BIR cuts red tape on issuing tax clearances
[Related: Duterte admin to spend P890.9B on infra next year]


JULY 14 -New BIR Chief Caesar Dulay. File Photo. ABS-CBN File Photo. True to President Rodrigo R. Duterte’s promise to cut on red tape, the Bureau of Internal Revenue (BIR) has made it easier and faster to secure tax clearance certificates (TCCs) as well as certificates authorizing registration (CARs). Under Revenue Memorandum Circular (RMC) No. 74-2016 issued by BIR Commissioner Caesar R. Dulay last June 13, internal revenue officers were ordered to process and release TCCs within two working days upon submission of complete documentary requirements. From nine previously, only three documents were now required: a notarized application form with two pieces of loose documentary stamp tax (DST); a delinquency verification issued by the concerned BIR office; as well as a print-out of the certification fee paid through the BIR’s electronic filing and payment system (eFPS), with payment confirmation. BIR offices were also ordered to issue the delinquency verification within 24 hours after the taxpayer filed the application, RMC 74-2016 said. The delinquency verification will have a one-month validity period, the BIR said in a statement. READ MORE...related Duterte admin to spend P890.9B on infra next year...

ALSO: Not affected by sea row ruling trade with China seen to further improve -Trade Sec Lopez


JULY 16 -Trade Secretary Ramon Lopez expects an improvement in the country’s trade relations with China following the recent international tribunal ruling on the maritime dispute in the South China Sea. STAR/File photo
Trade Secretary Ramon Lopez expects an improvement in the country’s trade relations with China following the recent international tribunal ruling on the maritime dispute in the South China Sea.
The Trade chief said Tuesday’s ruling would have no major impact on the country’s trade and investment climate amid speculations China’s fury over the decision would negatively affect its trade relationship with the Philippines. “We don’t see any impact offhand. Even prior to this decision, we already see the trade (between the two countries) ongoing in terms of imports and exports. We export a lot to China and it creates jobs for us. They export also to us and that has been continuing. So safe to say I don’t see any impact and in fact, (trade relationship) may even grow stronger,” he said. When asked on how both countries’ trade activities would improve given a ruling in favor of the Philippines, Lopez said: “With less political issue which we hope to happen, concerns on trade should likewise improve.”  “As I have mentioned, even in the past three years while this case was being taken up, we were seeing trade continuing. That’s why I’m saying there will be no impact,” he added. Lopez’ assessment was supported by local businessmen who likewise expressed optimism instead of concern regarding the ruling. READ MORE...RELATED, ‘Trade, tourism to benefit from PH-China talks’...

ALSO: Admin junks Aquino 3rd DBP-Landbank merger
[DOMINGUEZ THUMBS DOWN RATIONALE FOR UNION; “I’m really not sure that you’re going to be serving the public right because these institutions were put up to address two different kinds of problems: the problem of the farmers [in the case of Landbank] and the problem of the industry [in DBP’s case]]


JULY 15 -FINANCE SEC DOMINGUEZ The Duterte administration will repeal former President Benigno Aquino III’s order to merge state-run lenders Development Bank of the Philippines and Land Bank of the Philippines, Finance Secretary Carlos G. Dominguez III said. While the Department of Finance was still determining the legal way to repeal Executive Order No. 198 issued by Aquino in February, Dominguez told reporters that the current administration will not implement it.” According to Dominguez, the merger of DBP and Landbank cannot be done through a mere executive order, stressing in an earlier statement that such requires legislative action. The finance chief also pointed out that the two state-run banks have different mandates. “I’m really not sure that you’re going to be serving the public right because these institutions were put up to address two different kinds of problems: the problem of the farmers [in the case of Landbank] and the problem of the industry [in DBP’s case]. I don’t know how you can possibly think that by putting them together you’re going to serve the public better,”ť Dominguez said. DBP and Landbank have yet to formally apply for a merger with the Bangko Sentral ng Pilipinas (BSP), Deputy Governor Nestor A. Espenilla Jr. told reporters Wednesday night. READ MORE...RELATED, Aquino OKs DBP, Land Bank merger (Feb 9, 2016)...

ALSO:
Tsinoy entrepreneurs - It's business as usual after sea ruling


JULY 14 -A crowd attends the ceremonial opening of the Chinatown friendship arch at the foot of Jones Bridge in Manila in June 2015. The opening was led by Mayor Joseph Estrada and Chinese Ambassador Zhao Jianhua. Edd Gumban, file Business as usual.
Filipinos of Chinese descent who own businesses in the country said the arbitral ruling on the South China Sea row would not affect their operations as they expressed hopes that the issue would be resolved peacefully. Entrepreneurs interviewed by The STAR also said they are one with the nation’s legal victory because they consider themselves as Filipinos. “I don’t see any effect of this (ruling) on our business yet. Despite being Chinese by blood, we were born and we live here for a long time already. We are claiming that we are already Filipinos,” said Jennifer Chan, owner of JCS Integrated Building Resources Corp. “I agree with the ruling of the international court…If you ask me, we’ve waited so long for that decision,” she added. Peter Tiu, a stock broker, said the historic ruling would have no apparent impact on his business. "It doesn't affect (the business) at all, unless it escalates to war" Tiu said. On Tuesday, the Hague-based Permanent Court of Arbitration ruled that China’s claim of historic rights in about 90 percent of the resource-rich South China Sea has no legal basis. READ MORE...ALSO COMMENTARY, 10 truths from The Hague verdict...


READ FULL MEDIA REPORTS HERE:

Government tightens audit standards for miners


MGB director Leo Jasareno said Environment Secretary Gina Lopez wanted to raise the bar on responsible mining in the country with a stricter set of criteria in the audit of around 105 metallic and non-metallic mines nationwide, including quarrying and small-scale mining. AP Photo/David Goldman

MANILA, JULY 18, 2016 (PHILSTAR) By Louise Maureen Simeon Updated July 14, 2016 - 12:00am – The Mines and Geosciences Bureau (MGB) has imposed stricter audit standards for mining companies as part of efforts to put a stop to irresponsible mining.

MGB director Leo Jasareno said Environment Secretary Gina Lopez wanted to raise the bar on responsible mining in the country with a stricter set of criteria in the audit of around 105 metallic and non-metallic mines nationwide, including quarrying and small-scale mining.

“The comprehensive review will focus on the companies’ compliance with the requirements of the Mining Act of 1995, Environmental

Compliance Certificate, Forestry Law, and other laws pertaining to mining. We want to see whether a specific violation will entail suspension of operations,” Jasareno said.

He added that the new round of audit would look beyond regulatory requirements such as the social and economic impact of the mining operations nationwide.

Based on the initial review on mining companies, the MGB chief confirmed there were frequent violators of mining rules and regulations.

“You’ll be surprised with the number of companies violating the conditions of their contract, majority of which were slapped with equivalent amount of penalty depending on the discretion of who conducted the review,” Jasareno said.

“With the new round of audit. There will be a list of criteria they need to comply with, otherwise they may face suspension,” he added.

READ MORE...

However, Jasareno refused to name the companies included in the list of violators, saying they have already submitted their findings to the DENR secretary.


DENR Secretary Gina Lopez

The Chamber of Mines of the Philippines (COMP) on Tuesday called for the release of the list of cancelled mining applications and companies violating mining laws.

Just recently, Lopez issued her first memorandum order on the official audit of all operating mines and the moratorium on the approval of new mining projects.

In Memorandum Order No.2016-01, she ordered the audit of all operating and suspended mines while the moratorium covers the acceptance, processing and approval of applications and projects for all metallic and non-metallic minerals.

The order takes effect immediately and “shall remain in force and in effect until formally terminated.”

Mining firms, however, decried Lopez’s directive, which they said, would likely delay mining investments in the country.

“A continuing moratorium on new mining projects only breeds more confusion and uncertainty particularly on capital-intensive and risky mining business,” COMP vice president Nelia Halcon said.

Meanwhile, non-government organization Alyansa Tigil Mina (ATM) lauded Lopez on her first order but remained firm that “responsible mining remains to be a myth and it has no legal definition yet”.

She also pushed for the passage of the Alternative Minerals Resources Bill (AMMB) to frame the legal and operational definition of responsible mining.

“We challenge both the COMP and the DENR to seriously consider the AMMB as a starting point to discuss the concept of responsible mining. We assert that ‘responsible mining’ cannot be reduced to ISO certification, as earlier proposed,” ATM national coordinator Jaybee Garganera said.


INQUIRER

BIR cuts red tape on issuing tax clearances SHARES: 2434 VIEW COMMENTS By: Ben O. de Vera @BenArnolddeVera Philippine Daily Inquirer 04:12 PM July 14th, 2016


New BIR Chief Caesar Dulay. ABS-CBN File Photo.

True to President Rodrigo R. Duterte’s promise to cut on red tape, the Bureau of Internal Revenue (BIR) has made it easier and faster to secure tax clearance certificates (TCCs) as well as certificates authorizing registration (CARs).

Under Revenue Memorandum Circular (RMC) No. 74-2016 issued by BIR Commissioner Caesar R. Dulay last June 13, internal revenue officers were ordered to process and release TCCs within two working days upon submission of complete documentary requirements.

From nine previously, only three documents were now required: a notarized application form with two pieces of loose documentary stamp tax (DST); a delinquency verification issued by the concerned BIR office; as well as a print-out of the certification fee paid through the BIR’s electronic filing and payment system (eFPS), with payment confirmation.

BIR offices were also ordered to issue the delinquency verification within 24 hours after the taxpayer filed the application, RMC 74-2016 said.

The delinquency verification will have a one-month validity period, the BIR said in a statement.

READ MORE...

According to the BIR, approval of TCC applications will still be covered by criteria put in place by previous issuances, including: having no delinquent account; no open valid “stop filer” case; no unpaid annual registration fee; not tagged as “cannot be located” taxpayer; and should be a user of the eFPS for at least two consecutive months prior to the TCC application.

Also, Dulay issued Revenue Memorandum Order (RMO) No. 41-2016 last July 12, which mandated strict adherence to the BIR’s Citizen Charter as well as the provisions of Republic Act No. 9485 or the Anti-Red Tape Act of 2007 when processing and issuing CARs.

According to the BIR, RMO 41-2016 “reiterates the documentary requirements relative to applications for the issuance of CARs covering sale of real property, transfer or assignment of stocks not traded in the stock exchange, transfer subject top donor’s tax, estate tax, and other taxes including DST related to the sale/transfer of properties.”

Under the order, CARs must be issued within five days of submission of complete requirements; in contrast, the previous time frame was five up to 10 days.

“Officials and employees found to have violated this directive shall be subject to the criminal and administrative penalties provided under the Anti-Red Tape Act,” the BIR said.

The BIR explained that Dulay’s order “responds to complaints raised by taxpayers of CARs issued well beyond the prescribed period.” JE/rga

------------------------------------------

RELATED FROM PHILSTAR

Duterte admin to spend P890.9B on infra next year SHARES: 1048 VIEW COMMENTS By: Ben O. de Vera @BenArnolddeVera Philippine Daily Inquirer 06:09 PM July 14th, 2016


President Rodrigo R. Duterte has given his go-ahead to implement economic managers’ plan to do 24/7 work on infrastructure projects, alongside a faster rollout of public-private partnership (PPP) projects. FILE PHOTO PRESIDENTIAL PHOTOGRAPHERS DIVISION

 President Rodrigo R. Duterte has given his go-ahead to implement economic managers’ plan to do 24/7 work on infrastructure projects, alongside a faster rollout of public-private partnership (PPP) projects.

THE Duterte administration will spend a record P890.9 billion on vital infrastructure next year in line with plans to further hike expenditures to up to 7 percent of the gross domestic product (GDP) within the next six years, Budget Secretary Benjamin E. Diokno said.

The Department of Budget and Management (DBM) will submit for President Duterte’s approval the proposed P3.35-trillion 2017 national budget, a record-high amount over a tenth bigger than this year’s P3.002 trillion, Diokno told reporters on Thursday.

Next year’s expenditures on infrastructure will account for 5.2 percent of GDP, Diokno said, adding that the Duterte administration will focus on “pure” infrastructure on top of capital outlays.

In the 2016 budget, P762.5 billion were allocated for capital outlays, of which P631.9 billion would be spent on infrastructure.

Diokno said more money will be infused into projects for the construction of new as well as improvement of airports, seaports, major roads and bridges, farm-to-market roads, as well as post-harvest facilities.


DIOKNO

To rollout infrastructure projects faster, Diokno said the Duterte administration will order non-stop or 24-hours-a-day, seven-days-a-week construction work on most urban-based projects, citing huge economic costs brought about by delays.

Asked how the new administration will address the slow absorptive capacity of government agencies when it comes to spending their budgets, which was among the reasons blamed for the underspending on public goods and services during the past few years, Diokno said the President “will not tolerate incompetence.”

“If you cannot perform, you’re out… We will not tolerate delays,” the Budget chief said.

READ MORE...

Diokno said biddings for government projects will be conducted in the fourth quarter of the year prior to the year of implementation, short of award.

The Budget chief, however, said they will put on hold plans to construct new buildings for government offices, such as those planned for the Department of Finance, the National Economic and Development Authority as well as the Office of the Solicitor General.

Also, the Duterte administration will enjoin more public-private partnership (PPP) ventures in infrastructure, Diokno said. “We are open to unsolicited proposals, subject to Swiss Challenge. This will give us the opportunity to fast-track PPP projects,” he said.

Ramping up infrastructure spending to up to 7 percent of GDP before the end of the Duterte administration will help narrow the infrastructure gap, Diokno said, noting that the Philippines has among the worst infrastructure in Asean.

“In the short term, higher infrastructure spending will create jobs, increase incomes and boost the economy. For long term, it will propel us to a growth path of 7-8 percent [GDP expansion],” the budget chief said.

The Duterte administration has set an annual economic growth target of 7-8 percent from 2018 to 2022.


PHILSTAR

Not affected by sea row ruling trade with China seen to further improve By Richmond Mercurio (The Philippine Star) | Updated July 16, 2016 - 12:00am 0 0 googleplus0 0


Trade Secretary Ramon Lopez expects an improvement in the country’s trade relations with China following the recent international tribunal ruling on the maritime dispute in the South China Sea. STAR/File photo

MANILA, Philippines - Trade Secretary Ramon Lopez expects an improvement in the country’s trade relations with China following the recent international tribunal ruling on the maritime dispute in the South China Sea.

The Trade chief said Tuesday’s ruling would have no major impact on the country’s trade and investment climate amid speculations China’s fury over the decision would negatively affect its trade relationship with the Philippines.

“We don’t see any impact offhand. Even prior to this decision, we already see the trade (between the two countries) ongoing in terms of imports and exports. We export a lot to China and it creates jobs for us. They export also to us and that has been continuing. So safe to say I don’t see any impact and in fact, (trade relationship) may even grow stronger,” he said.

When asked on how both countries’ trade activities would improve given a ruling in favor of the Philippines, Lopez said: “With less political issue which we hope to happen, concerns on trade should likewise improve.”

“As I have mentioned, even in the past three years while this case was being taken up, we were seeing trade continuing. That’s why I’m saying there will be no impact,” he added.

Lopez’ assessment was supported by local businessmen who likewise expressed optimism instead of concern regarding the ruling.

READ MORE...

Philippine Exporters Confederation Inc. president Sergio Ortiz-Luis Jr. said trade and tourism relations with China suffered slightly over the past three years or since the country filed an arbitration case against China at The Hague.

“I think (our trade relationship with China) will go back to normal given the way the administration is handling it well now. Although we will not resolve the ownership issue, I think it will be pushed back to at least what it was before, prior to the case and it may even increase and improve,” Ortiz-Luis said.

“President Duterte’s pronouncement that we are not going into war with China is the right way to go,” said Philippine Chamber of Commerce and Industry honorary chairman Donald Dee, noting increased investments from China., particularly in infrastructure, is a big possibility.

As of April this year, bilateral trade between the Philippines and China is valued at $1.725 billion.

As the country’s single biggest trading partner, China accounted for 10.6 percent of Philippine exports, while it was the source of a fifth of Philippine imports.

----------------------------------------------

RELATED FROM THE MANILA TIMES

‘Trade, tourism to benefit from PH-China talks’ July 14, 2016 8:57 pm by Kristyn Nika M. Lazo

 

The Duterte administration’s push for bilateral talks with China — after the favorable arbitration tribunal ruling to the Philippines — will be beneficial for the country in “bringing back” its lost Chinese market in terms of trade, investments and tourism.

The country would likely “leverage” on this ruling, pursuing bilateral talks with China “as equals” to improve trade, investment and tourism relations between the two economies, said George Barcelon, president of the Philippine Chamber of Commerce and Industry (PCCI), and Sergio Ortiz-Luis Jr., president of Philippine Exporters Confederation Inc. (Philexport).

“During his speech in Sulong Pilipinas, the President mentioned improving the trade relationship. So I think, even with this decision, it works in our favor. We will leverage on that in our future discussions, that we have rights over that area. But for us, we should not rush; give it some time,” Barcelon said.

“It would be good if we sit down as equals and discuss how we can share, in trade, and exploration. I think all of these things will come to our country. I think it will not come very quickly; it will take time,” he added.

“Where does it bring us? I think where we were before we start this process. So now, we will probably go with bilateral talks with China, as it had wanted from the beginning anyway. And what will we negotiate? Probably joint exploration, which we already got with before I think we signed with China and Vietnam… I thought we’re going to negotiate anyway,” Ortiz-Luis said.

Ortiz-Luis was referring to the Joint Marine Seismic Undertaking (JMSU) in 2008 between the Philippines, China and Vietnam — an agreement that allowed China and Vietnam to jointly explore the Philippine oil resources in the claimed island territories in the West Philippine Sea.

READ MORE...

“Anyway, I think it’s high time now that we recover this market. I think the administration is handling it well, not to further gloat on this because it’s just a paper victory. We are on the moral high ground, but at the end of the day, we’ll still base on what will be the turnout of the future talks. What we lost in the previous years, we’ll now recover if we’re able to talk to them [and have] a good arrangement,” Ortiz-Luis said.

In terms of trade, the Philexport president cited the “banana tale” that caused the country “billions and billions dollars” in potential revenue. He was referring to the incident in March where China trashed 35 tons of Philippine bananas that they labeled as “substandard.”

For tourism, he said the country has suffered sharp declines in Chinese visitors every year after 50 percent growth from this market three years ago. The same trend of slowing Chinese participation was seen in foreign direct investments to the Philippines.

“When we started [in the push for the arbitration], our tourist arrivals from China were negative for a while, and then it slowly recovered to a reasonable degree. A lot of export commitments also did not come, they canceled them,” Ortiz-Luis said.

“So, we negotiate now. I think the way we’re handling it is good. We have the moral high ground, at least that, and when we talk with China, we’ll probably get a good arrangement.

We did not get direct foreign investments from the ones that pushed us to this fight, even from our neighbors. We are the ones bullied, left behind. But I hope we recover it,” he added.

Through the years, China has been one of the Philippines’ top five biggest trade partners, both in exports and imports.


PHILSTAR

Admin junks DBP-Landbank merger
[
DOMINGUEZ THUMBS DOWN RATIONALE FOR UNION]
SHARES: 120 VIEW COMMENTS By: Ben O. de Vera @BenArnolddeVera Philippine Daily Inquirer 12:44 AM July 15th, 2016


FINANCE SEC DOMINGUEZ

The Duterte administration will repeal former President Benigno Aquino III’s order to merge state-run lenders Development Bank of the Philippines and Land Bank of the Philippines, Finance Secretary Carlos G. Dominguez III said.

While the Department of Finance was still determining the legal way to repeal Executive Order No. 198 issued by Aquino in February, Dominguez told reporters that the current administration will not implement it.”

According to Dominguez, the merger of DBP and Landbank cannot be done through a mere executive order, stressing in an earlier statement that such requires legislative action.

The finance chief also pointed out that the two state-run banks have different mandates. “I’m really not sure that you’re going to be serving the public right because these institutions were put up to address two different kinds of problems: the problem of the farmers [in the case of Landbank] and the problem of the industry [in DBP’s case]. I don’t know how you can possibly think that by putting them together you’re going to serve the public better,”ť Dominguez said.

DBP and Landbank have yet to formally apply for a merger with the Bangko Sentral ng Pilipinas (BSP), Deputy Governor Nestor A. Espenilla Jr. told reporters Wednesday night.

READ MORE...

The BSP nonetheless had received a business plan on the DBP-Landbank merger, which must get the nod of the BSP and state run Philippine Deposit Insurance Corp.

EO 198 ordered the merger of DBP and Landbank within a one-year timeline, with the latter as surviving entity.

The merger will result in a bank with combined assets of P1.71 trillion, based on end-2015 BSP data, which will make it the country’s second biggest bank in terms of assets and seen challenging local tycoons’ dominance in the banking sector.

The bigger lender to be established from the merger is being eyed to increase loans to infrastructure projects on top of initiatives under their developmental mandate.

“The merger will result in a combined single borrower’s limit (SBL) of P26 billion compared with DBP’s SBL at P9 billion and Landbank’s at P17 billion. A higher SBL enables the surviving bank to fund big-ticket infrastructure projects,”ť the Governance Commission for Government Owned or Controlled Corporations (GCG) had said in a briefing paper.

------------------------------

RELATED FROM THE INQUIRER (FLASHBACK (FEBRUARY 9, 2916)

Aquino OKs DBP, Land Bank merger By: Ben Arnold de Vera @BenArnolddeVera Philippine Daily Inquirer
12:54 PM February 9th, 2016

President Benigno Aquino III has given his go-ahead for the merger of state-run banks Development Bank of the Philippines (DBP) and Land Bank of the Philippines (LBP)

Executive Order (EO) No. 198 issued on Feb. 4 and published Tuesday said the Governance Commission for GOCCs (GCG) earlier determined that “it is in the best interest of the State to merge DBP and LBP, with the latter as the surviving entity,” noting of the two banks’ overlapping functions.

The EO said the merger “will build a stronger and more competitive universal development bank able to fulfill its mandate of providing banking services to propel countryside development and to contribute to sustainable and inclusive growth.”

The operational merger of DBP and Land Bank through the transfer of assets and liabilities of DBP to LBP is still subject to the written consent of the Philippine Deposit Insurance Corp. as well as Bangko Sentral ng Pilipinas approval, the EO read.

READ:House passes DBP, LBP merger bill

Following the recommendation of the Department of Finance (DOF), LBP’s capital stock will be increased to P200 billion (from P25 billion).

The EO also directed the DOF as well as the Department of Budget and Management to infuse P30 billion in capital to LBP.

The GCG will implement the merger, including undertaking a reorganization plan, under which personnel of the two banks who will be separated from service shall receive a merger incentive pay on top of separation or retirement benefits.

In a statement, Finance Secretary Cesar V. Purisima said the merger “bodes well for the stability of our banking system.”

“With better capital adequacy and robust resources, we can expect government banking to continue growing, especially in terms of efficiency and size of the public served,” Purisima said. CDG


PHILSTAR

Tsinoy entrepreneurs: It's business as usual after sea ruling By Lorenzo Acuńa, Natasha Isidro and Alexis Romero (philstar.com) | Updated July 14, 2016 - 2:45pm 2 39 googleplus0 0


A crowd attends the ceremonial opening of the Chinatown friendship arch at the foot of Jones Bridge in Manila in June 2015. The opening was led by Mayor Joseph Estrada and Chinese Ambassador Zhao Jianhua. Edd Gumban, file Business as usual.

Filipinos of Chinese descent who own businesses in the country said the arbitral ruling on the South China Sea row would not affect their operations as they expressed hopes that the issue would be resolved peacefully.

Entrepreneurs interviewed by The STAR also said they are one with the nation’s legal victory because they consider themselves as Filipinos.

“I don’t see any effect of this (ruling) on our business yet. Despite being Chinese by blood, we were born and we live here for a long time already. We are claiming that we are already Filipinos,” said Jennifer Chan, owner of JCS Integrated Building Resources Corp.

“I agree with the ruling of the international court…If you ask me, we’ve waited so long for that decision,” she added.

Peter Tiu, a stock broker, said the historic ruling would have no apparent impact on his business.

"It doesn't affect (the business) at all, unless it escalates to war" Tiu said.

On Tuesday, the Hague-based Permanent Court of Arbitration ruled that China’s claim of historic rights in about 90 percent of the resource-rich South China Sea has no legal basis.

READ MORE...

The extent of China’s sweeping maritime claim is illustrated by the so-called nine-dash line, which overlaps with the claims of the Philippines, Vietnam, Malaysia, Brunei and Taiwan.

In its landmark decision, the arbitral court awarded the Philippines sovereign rights over the Panganiban (Mischief) Reef, Ayungin (Second Thomas) Shoal, and Recto (Reed) Bank. It did not award sovereign rights to the Philippines over the Panatag (Scarborough) Shoal off Zambales but declared it a traditional fishing ground for several countries.

According to the court, China’s construction of artificial islands in disputed areas was a violation of the Philippines’ sovereign rights. The reclamation also aggravated the territorial row and caused “irreparable” harm to the marine environment, the tribunal added.

The Philippine government, which challenged the legality of China’s expansive territorial claim in 2013, has welcomed the ruling and is now studying its next move. China dismissed the decision as “null and void” and maintained that it would not diminish its territorial sovereignty in the South China Sea.

No impact on business

Paulo Rueda, a home-based businessman, said businesses would be the first to be affected if the tensions in the South China Sea escalates into a war.

He believes the Panatag Shoal, which is located 124 nautical miles from the nearest point in Zambales, would be a factor in the economic growth of the country because of its natural resources.

“We will have more sources of marine resources. We know that Scarborough Shoal is rich in different kinds of maritime resources,” Rueda said.

Jonathan Yu, owner of Apollo Tires Quezon Ave., said he is happy with the decision of the tribunal and believes that other traders feel the same.

“I believe all countries that have vessels passing through the area are glad of the result,” Yu said.

He said the ruling is “purely political” and would not have a direct effect on his business.

An owner of an advertising firm who refused to be named, believes that China has reasons for rejecting the ruling.

“That ruling was expected. So was the reaction of China. Are they in favor? Cannot be answered by a yes or no quickly. Fair? Yes. But why China is doing that is because there’s a reason,” the advertising firm owner said.

“China wants to be a world power and it believes that America is hindering that,” he added.

'Good Philippine-China ties necessary'

“The effect on business depends on the next move of the government. (President) Duterte had said that if the Philippines wins and China doesn’t want to budge, he is open to bilateral talks.”

The United States has vowed to remain neutral on the dispute but American officials have repeatedly criticized China’s aggressiveness in the South China Sea.

Some Chinese-Filipino entrepreneurs believe the Philippines and China should settle their differences diplomatically, noting that many raw materials and products are made in Beijing.

“There should be a middle ground,” said Lilian Tan, a shop owner in Binondo, Manila.

“Almost all of the things we use are from China so we have no choice,” said Roland Chua, a drug store owner in Manila.

Trader Keisuke Chan also welcomed the ruling but believes some important questions have to be answered.

“I am in favor of the ruling. Even if I am Chinese, I was born in the Philippines and I’m already a Filipino citizen,” Chan said.

“There are many resources there (in South China Sea) and supposedly that is the reason why China is also claiming the area…The question is do we have the capability to tap those resources so we can achieve economic development?”

“Is there an assurance that every Filipino will benefit?”

---------------------------

ALSO PHILSTAR COMMENTARY

10 truths from The Hague verdict AS EASY AS ABC By Atty. Alex B. Cabrera (The Philippine Star) | Updated July 17, 2016 - 12:00am 1 52 googleplus0 0


Atty Alex Cabrera

It is a David who threw a determinative stone against a Goliath – but this is not that kind of story. Unfortunately, the stone the Philippines threw will not make China fall back from Philippine territory anytime soon. At best the stone hits a gong that creates a loud sound heard internationally, for the rest of the reasonable people in the world to hear — the same people who are nowadays more anxious than ever but more determined as well to stand up against terror, big or small, on land, air, or water. Allow me this Sunday to share 10 worthy lessons from the 500-page ruling of the United Nations Court of Arbitration in The Hague, in favor of the Philippines:

1. The nine-dash line is a lie. This is a unilateral claim first asserted by China through a map submitted to the United Nations in May 2009 (against which the Philippines immediately protested). It lacked the elements of a valid historic claim because there is no acquiescence by other coastal states, and there was no sufficient passage of time to put beyond doubt the existence of the right and the agreement of the affected states. The court noted that the other states do not even know the nature and extent of China’s claims.

2. Assuming China has historic rights, the same was superseded by UNCLOS. China is not only a member of the United Nations, it signed the United Nations Convention on the Law of the Seas (UNCLOS) on Dec. 10, 1982 and ratified it in 1996. The UNCLOS is thus not only persuasive, it is binding and must be complied with by China.

3. Even if China did not appear before the tribunal, the Court can still rule. The Tribunal admitted that they found it difficult to fully probe an issue despite China’s refusal to respond. The tribunal cannot decide merely on the Philippine submissions but must satisfy itself that the claim is based on facts and law.

4. China’s position was heard in the proceedings. The court made use of publicly available information, such as the Position Paper of China made public on Dec. 7, 2015. The former Chinese ambassador also submitted two letters, and the current ambassador, four letters directing the members of the Tribunal to statements of the Chinese government and the publicly available materials. (In substance, China participated.)

5. Vietnam supported the proceedings. While it did not participate in the case, Vietnam formally made a submission to support the proceedings as valid. Other countries who requested were granted observer status in the case,

6. China should have secured from the Philippines the permit to fish. The disputed areas fall within the Philippines’ exclusive economic zone (within 200 miles from Philippine baseline). Thus the permits issued by China to Chinese fishermen are not valid because it is the Philippines that has the sovereign rights. On the contrary, Filipino fishermen were prevented from fishing in the Panatag shoals since 2012.

7. China enjoys limited rights in the Philippine Exclusive Economic Zone (EEZ). China can enjoy navigation and overflight, can lay submarine cables and pipelines, and practice other lawful uses of the sea, even within the Philippine EEZ. (As we all know, they did a bit more, like build islands and airstrips, among others.)

8. China violated UNCLOS by destroying marine environment. China destroyed coral reefs through its constructions and tolerated the acts of its nationals in harvesting giant clams and turtles, and in using explosives in fishing. This is not a sovereignty issue but a breach of environmental obligations under the UNCLOS.

9. The disputed reefs and shoals are within 125 miles from the Philippine baseline. Scarborough (Panatag) is 116.2 nautical miles off Zambales, while Mischief Reef is 125.4 and Second Thomas Shoal is 104.4, both off Palawan — all of them several hundreds of miles from China. All of them are well within the Philippines’ 200-mile EEZ and well beyond China’s EEZ.

10. If these disputed reefs and shoals were islands, the court would not rule on them. These low water elevations, which disappear during high tide, cannot sustain human life. There is no source of vegetation or drinkable water. If they were really islands capable of human habitation, the court would not have ruled that they were within the Philippine EEZ.

The court did not elaborate on this last point, but it seems that if they were islands, and humans dwelled there, those inhabitants would have been capable of establishing community and government and communicating what their country is (or we can find out if they speak Filipino or Chinese).

The other brutal facts are: China is permanent member of the UN and a part of the Security Council, the enforcement arm of the UN. (Will China veto actions or will it be asked to desist, for fairness’ sake?) Whoever subjects China to economic sanctions will also effectively sanction themselves economically. China is prepared or does not care if war erupts in the disputed territory — anyway, it’s only our territory that will be damaged while our people in Zambales or Palawan will potentially be hurt. And the Chinese territory will be safe, and the Chinese people will be sleeping soundly, several hundreds of miles away.

Will the world come to the rescue of one David in the Asia Pacific, or will they tolerate the situation for short-term gains? Will the other Davids, including Vietnam, Malaysia, Cambodia, Brunei, and other states in the claimed “South China” Sea find their voice, and find their own vital stones? Can we fish again in our own waters? Will the giant shock the world, sit down and talk? While we wait for answers, we realize that patience is not only a virtue – it’s our only choice.

They lost the case. It would be easier if they do not lose face.

* * *

Alexander B. Cabrera is the chairman and senior partner of Isla Lipana & Co./PwC Philippines. He also chairs the Educated Marginalized Entrepreneurs Resource Generation (EMERGE) program of the Management Association of the Philippines (MAP). Email your comments and questions to aseasyasABC@ph.pwc.com. This content is for general information purposes only, and should not be used as a substitute for consultation with professional advisors.


Chief News Editor: Sol Jose Vanzi

© Copyright, 2016 by PHILIPPINE HEADLINE NEWS ONLINE
All rights reserved


PHILIPPINE HEADLINE NEWS ONLINE [PHNO] WEBSITE