SIX OUT OF TEN FILIPINOS WANT OIL DEREGULATION LAW REPEALED

IBON SURVEY

In the wake of weekly oil price hikes and skyrocketing pump prices, six out of ten Filipinos said they favored the repeal of the Oil Deregulation Law, according to the latest survey conducted by independent think-tank IBON Foundation.

Results of the April 2008 IBON survey showed that 58.6% of respondents said they agree with proposals to restore government regulation of the local oil industry and repeal the Oil Deregulation Act (RA 8479). The law, which was implemented in 1998, removed government control over the downstream oil industry.

The IBON nationwide survey was conducted nationwide from April 7 to 16, 2008 with 1,495 respondents from various sectors, using a multi-stage probability sampling scheme with a margin of error of plus or minus three percent.

Below is the tabulation of results of the respondents’ perception on returning government regulation on the oil industry.

Do you agree with the proposals to return government regulation on the oil industry and to repeal the Oil Deregulation Law?

	January 2008		April 2008
	Frequency	Percentage	Frequency	Percentage
Yes	891	59.28	876	58.60
No	383	25.48	369	24.68
Don’t Know	218	14.50	235	15.72
No answer	11	0.73	15	1.00
Total	1,503	100.00	1,495	100.00

GOVT URGED TO DISCONTINUE BANKRUPT LAWS LIKE AFMA:Policies only worsened RP’s dependence on rice imports

Independent think-tank IBON Foundation today urged the Arroyo administration to discontinue policies like the Agriculture and Fisheries Modernization Act (AFMA), which has only contributed to the country’s current rice crisis.

Rice imports have consistently increased since the AFMA was signed into law in 1997. From 722,000 metric tons in 1997, rice imports as of 2006 have already reached 1.7 million metric tons. For 2008 the country is estimated to import some 2 million metric tons of rice.

AFMA, which was signed in 1997, promised to develop and modernize the agriculture sector through investments and importation of machinery. It allows the private sector to participate in rice importaion, and targets to separate and partly privatize the regulatory and trading functions of the NFA.

The AFMA complements the government’s medium-term plan in agriculture, which aims to reduce the production of rice and corn from 5 million MT to 3.1 million MT and invite foreign businesses to invest in the country’s key production areas.

Neither the medium-term plan nor the AFMA can address the basi c p roblems of the country’s farmers, such as lack of support services and subsidies. Instead, it encourages more foreign investment in export-oriented agricultural production through the Strategic Agriculture and Fisheries Development Zones (SAFDZ).

The country can never achieve food security and self-sufficiency under liberalization policies like AFMA because it promotes entry of foreign investments in the local agriculture instead of supporting the sector and subsidizing Filipino farmers. What is needed is for the government to address age-old problems through government support for agriculture and reversing trade liberalization, while implementing genuine agrarian reform.

OIL TRANSNATIONALS WILL BENEFIT MORE WITH TARIFF CUT – IBON

Independent think-tank IBON Foundation said that the tariff cut on crude oil imports would mainly benefit the transnational corporations (TNCs) that dominate the local oil industry while having a negligible, if any, effect on pump prices.

Experience shows that TNCs pass on costs of high tariffs to pump prices but enjoy savings when tariffs are low. Firms do not actually translate tariff reductions to lower oil prices and do not deliver on consumers’ hope for reduced prices on oil products. In fact, the first reaction of independent oil players to news of the tariff cut was to say that it was not enough to ensure lower pump prices.

The only answer to high oil prices is for government to nationalize the local oil industry, starting with the repeal of the Oil Deregulation law (Republic Act 8479). The law has only allowed TNCs to further intensify their control over the local industry even as it has resulted in near-weekly rounds of oil price hikes.

IBON reiterates the call for the lifting of the 12% value-added tax on petroleum products since it would result in a substantial reduction in pump prices of at least P4 per liter; such a call is in the spirit of the more urgent necessity of governemnt regulation of the industry.

Business, Ramos, Enrile, Ermita on Estrada verdict

Inquirer
Last updated 02:50am (Mla time) 09/06/2007

MANILA, Philippines — The business community will be disappointed if Joseph Estrada is acquitted by the Sandiganbayan of plunder, a securities analyst said Wednesday.

 

But it will also be disappointed if the ousted President is convicted and subsequently pardoned by President Gloria Macapagal-Arroyo, said Astro del Castillo, a director of the Association of Securities Analysts of the Philippines.

 

“It’s the right opportunity to create a model to go after grafters,” Del Castillo told the Philippine Daily Inquirer, parent company of INQUIRER.net.

 

“Reconciliation will always be there. But we have a long list of pardoned criminals and a short list of big fish who are punished for wrongdoing,” he said.

 

According to Del Castillo, the business community expects a verdict of conviction and corresponding punishment for Estrada, who is under house arrest at his vacation estate in Tanay, Rizal.

 

“Confidence will be affected,” he said of the prospect of an acquittal or a pardon.

 

Nonetheless, the business community is focused on the economic fundamentals and will be unnerved only if the security situation deteriorates as a result of the Sandiganbayan decision, whatever it may be, Del Castillo said.

 

No choice

 

In Sen. Juan Ponce Enrile’s opinion, Estrada has no choice but to accept a presidential pardon should the anti-graft court convict him of plunder.

 

A pardon is not for Estrada to reject because when the President grants it, she can immediately pull out the guards from his vacation estate, according to Enrile.

 

The senator expressed doubt that a verdict of acquittal would again raise questions on the legitimacy of the Arroyo administration.

 

He pointed out that Estrada’s term had already run its course and that Ms Arroyo was serving a new term. Thus, he said, there was no reason for Ms Arroyo to be insecure about her term.

 

Sen. Jinggoy Estrada, the ousted President’s eldest son, said there was no reason for Ms Arroyo to fear any payback from his father should the verdict be an acquittal.

 

“We are only out to clear our father’s name; we have no other agenda,” the younger Estrada said.

 

On the other hand, former President Fidel Ramos told the Inquirer on Tuesday that all talk about a pardon for Estrada in case of a conviction was premature.

 

SWS survey

 

He said government officials should wait for the court’s verdict before making such an offer.

 

Ramos shook his head at the mention of the recent Social Weather Stations survey showing that most residents of Mega Manila were in favor of a pardon for Estrada.

 

“You wait for the court,” he stressed.

 

‘Consider the people’

 

At a press conference in Malacañang, Executive Secretary Eduardo Ermita said the Sandiganbayan’s verdict could be used by certain quarters to sow chaos and instability, and that it was up to Estrada to ease the tense political atmosphere.

 

Ermita also called on the public to remain calm, and for Estrada partisans to observe the rule of law.

 

“As a good citizen and especially as a public official, all I can say is if my advice is sought [by Estrada] — and for that matter, I’m saying it right now — the best option would be really to consider the conditions of the greater majority of our people,” Ermita said.

 

Asked whether he would advise Estrada to “shun any offer to do an EDSA IV after his verdict,” Ermita said:

 

“Let’s not think of things that would destabilize ourselves because, of course, economic progress can only happen in a stable political environment. Anything that will cause destabilization even in the minds of our people should be avoided.”

 

Ermita said he expected Estrada to be “a responsible citizen.”

 

“Considering that he was President, and knowing him, I think he knows what’s good for our people…” the executive secretary said.

 

‘He knows better’

 

Ermita said he could not offer anything in exchange for Estrada’s cooperation in suppressing street protests.

 

“The former President is definitely much better than I am. He became President, I’m only where I am, so I don’t think that I can advise him on anything. He definitely knows better than what I might know, as far as his conduct is concerned,” Ermita said, adding:

 

“But I know that the reason he’s popular is that as a political leader, he wants the welfare of the majority of our people, rather than just personal ends, to be [paramount]. To that extent, I think former President Estrada would know how to conduct himself, especially in light of all these rumors of what might happen as a result of the verdict, whatever the verdict might be.”

 

‘Exchange of views’

 

National Security Adviser Norberto Gonzales on Tuesday said that he had a lunch meeting last week with Estrada but that it was a mere “exchange of views.”

 

Also on Tuesday, Interior Secretary Ronaldo Puno, Ms Arroyo’s newly appointed political adviser, said a pardon for Estrada in the event of a conviction was not farfetched. Reports from Norman Bordadora, Gil C. Cabacungan Jr., Cynthia D. Balana and Michael Lim Ubac

Business, Ramos, Enrile, Ermita on Estrada verdict

Inquirer
Last updated 02:50am (Mla time) 09/06/2007

MANILA, Philippines — The business community will be disappointed if Joseph Estrada is acquitted by the Sandiganbayan of plunder, a securities analyst said Wednesday.

 

But it will also be disappointed if the ousted President is convicted and subsequently pardoned by President Gloria Macapagal-Arroyo, said Astro del Castillo, a director of the Association of Securities Analysts of the Philippines.

 

“It’s the right opportunity to create a model to go after grafters,” Del Castillo told the Philippine Daily Inquirer, parent company of INQUIRER.net.

 

“Reconciliation will always be there. But we have a long list of pardoned criminals and a short list of big fish who are punished for wrongdoing,” he said.

 

According to Del Castillo, the business community expects a verdict of conviction and corresponding punishment for Estrada, who is under house arrest at his vacation estate in Tanay, Rizal.

 

“Confidence will be affected,” he said of the prospect of an acquittal or a pardon.

 

Nonetheless, the business community is focused on the economic fundamentals and will be unnerved only if the security situation deteriorates as a result of the Sandiganbayan decision, whatever it may be, Del Castillo said.

 

No choice

 

In Sen. Juan Ponce Enrile’s opinion, Estrada has no choice but to accept a presidential pardon should the anti-graft court convict him of plunder.

 

A pardon is not for Estrada to reject because when the President grants it, she can immediately pull out the guards from his vacation estate, according to Enrile.

 

The senator expressed doubt that a verdict of acquittal would again raise questions on the legitimacy of the Arroyo administration.

 

He pointed out that Estrada’s term had already run its course and that Ms Arroyo was serving a new term. Thus, he said, there was no reason for Ms Arroyo to be insecure about her term.

 

Sen. Jinggoy Estrada, the ousted President’s eldest son, said there was no reason for Ms Arroyo to fear any payback from his father should the verdict be an acquittal.

 

“We are only out to clear our father’s name; we have no other agenda,” the younger Estrada said.

 

On the other hand, former President Fidel Ramos told the Inquirer on Tuesday that all talk about a pardon for Estrada in case of a conviction was premature.

 

SWS survey

 

He said government officials should wait for the court’s verdict before making such an offer.

 

Ramos shook his head at the mention of the recent Social Weather Stations survey showing that most residents of Mega Manila were in favor of a pardon for Estrada.

 

“You wait for the court,” he stressed.

 

‘Consider the people’

 

At a press conference in Malacañang, Executive Secretary Eduardo Ermita said the Sandiganbayan’s verdict could be used by certain quarters to sow chaos and instability, and that it was up to Estrada to ease the tense political atmosphere.

 

Ermita also called on the public to remain calm, and for Estrada partisans to observe the rule of law.

 

“As a good citizen and especially as a public official, all I can say is if my advice is sought [by Estrada] — and for that matter, I’m saying it right now — the best option would be really to consider the conditions of the greater majority of our people,” Ermita said.

 

Asked whether he would advise Estrada to “shun any offer to do an EDSA IV after his verdict,” Ermita said:

 

“Let’s not think of things that would destabilize ourselves because, of course, economic progress can only happen in a stable political environment. Anything that will cause destabilization even in the minds of our people should be avoided.”

 

Ermita said he expected Estrada to be “a responsible citizen.”

 

“Considering that he was President, and knowing him, I think he knows what’s good for our people…” the executive secretary said.

 

‘He knows better’

 

Ermita said he could not offer anything in exchange for Estrada’s cooperation in suppressing street protests.

 

“The former President is definitely much better than I am. He became President, I’m only where I am, so I don’t think that I can advise him on anything. He definitely knows better than what I might know, as far as his conduct is concerned,” Ermita said, adding:

 

“But I know that the reason he’s popular is that as a political leader, he wants the welfare of the majority of our people, rather than just personal ends, to be [paramount]. To that extent, I think former President Estrada would know how to conduct himself, especially in light of all these rumors of what might happen as a result of the verdict, whatever the verdict might be.”

 

‘Exchange of views’

 

National Security Adviser Norberto Gonzales on Tuesday said that he had a lunch meeting last week with Estrada but that it was a mere “exchange of views.”

 

Also on Tuesday, Interior Secretary Ronaldo Puno, Ms Arroyo’s newly appointed political adviser, said a pardon for Estrada in the event of a conviction was not farfetched. Reports from Norman Bordadora, Gil C. Cabacungan Jr., Cynthia D. Balana and Michael Lim Ubac

Garcillano, 3 others summoned to Senate wiretap probe

Villegas, Abu, Doble confirm attendance

By Veronica Uy
INQUIRER.net
Last updated 10:43am (Mla time) 09/06/2007

MANILA, Philippines — Bishop Socrates Villegas, General Efren Abu, retired Armed Forces chief; Rear Admiral Tirso Danga, and former elections commissioner Virgilio Garcillano will top-bill the hearing on the wiretapping scandal Friday, Senator Rodolfo Biazon said Thursday.

 

At the ongoing Kapihan sa Senado, Biazon said the list also includes lawyer Samuel Ong, deputy director of the National Bureau of Investigation, and former military intelligence agent Vidal Doble Jr.

 

Biazon said only Villegas, Abu, and Doble have confirmed their attendance.

 

He said Danga was expected to invoke Executive Order 464.

defense

NEW MAN AT DEFENSE. President Gloria Macapagal-Arroyo swears into office new Defense Secretary Gilbert Teodoro in Malacañang Tuesday. Teodoro, 43, is a former Tarlac congressman. AFP/ROMEO GACAD

Central bank monetary policy seen too tight

Economist says this may drag down economic growth

By Michelle Remo
Inquirer
Last updated 07:37pm (Mla time) 08/05/2007

THE SURPRISING 6.9-percent economic growth in the first quarter, which officials said was a proof the Philippines was no longer a laggard in Asia, is unlikely to be sustained if the Philippine bank would stick to its tight monetary policy.

 

Victor Abola, economist from the University of Asia & the Pacific, said that the current policy stance of the Bangko Sentral ng Pilipinas (BSP) was not conducive to boosting the growth of the economy.

 

In a study presented to the media last week, Abola said the slowdown of the inflation to below-target levels might drag down economic growth and lead to loss of jobs in the short to medium term.

 

Instead of keeping its key policy rate at 6 percent, Abola said the BSP should slash this to 4 percent to create more room for growth. He said there was no reason for keeping a tight monetary policy when inflation has already gone down way below the target.

 

The economist said that while low inflation was normally desirable, as it was expected to encourage consumption and influence higher growth, consciously bringing it down to very low levels would result in lower economic output and higher incidence of unemployment.

 

Abola said the central bank’s tight monetary policy had already pulled down the inflation rate to only 2.6 percent in the first half, lower than the official target of 4 to 5 percent for the entire year.

 

In his study, Abola said that by average, a one-percentage-point drop in inflation rate would lead to a decline in the gross domestic product by 0.64 percent to 2.41 percent. A 0.64-percent drop in the GDP results in the loss of 89,000 to 159,000 jobs. Taking the high end, he added, a 2.41-percent drop in GDP would trim down the number of jobs by 329,000 to 600,000.

 

He further explained that inflation and economic growth had a direct relationship, meaning lower growth was normally associated with lower inflation. “This is because inflation is directly affected by demand for goods and services, and that slowdown in aggregate demand drags down overall economic growth.”

 

Abola said there should, therefore, be a right policy mix that would keep inflation within tolerable levels while achieving a desirable level of economic growth.

 

“It seems like the BSP is putting too much weight on lowering inflation and zero weight on boosting output. Keeping inflation low is a good thing but it is not the only important thing,” Abola said.

 

As stated under the Arroyo administration’s economic targets for the year, inflation is targeted to stay within 4 to 5 percent while GDP growth is targeted to reach between 6.1 and 6.7 percent.

 

Abola said monetary policy should loosen up if the government wanted the 6.9-percent growth sustained.

 

The BSP has refrained from easing its policy stance especially since growth in money supply had been reaching uncomfortable levels. The year-on-year growth in money supply was recorded at more than 20 percent in May. The rate eased to 19.4 percent in June.

 

According to the BSP, money supply growth of beyond 20 percent put the government’s inflation targets at risk of being breached.

Bills on income tax, subsidy cuts pushed

By Michelle Remo
Inquirer
Last updated 05:18pm (Mla time) 08/05/2007

BILLS THAT will simplify the income tax system and cut subsidies to industry are expected to be discussed when Cabinet officials and lawmakers meet this week to decide on the priorities for the 14th Congress.

 

Finance undersecretary Gil Beltran, who will attend Tuesday’s meeting in Malacañang, said the government was hoping Congress would adopt the proposed simplified net income tax system (SNITS) and the rationalization of fiscal incentives.

 

Under the SNITS plan, professionals and self-employed individuals will have the option of deducting a uniform rate of 40 percent from their gross income to determine their taxable income.

 

This will simplify the current system that requires the self-employed to compute allowable deductions, such as expenses related to operation of a business, to arrive at their taxable income. The tedious process of computing discourages some from religiously pay their taxes, finance officials have said.

 

It is also under the SNITS that the Department of Finance (DoF) wants minimum wage earners exempted from the income tax. The DoF said that although this will result in lost potential revenues for the government, the amount would only be minimal at about P500 million a year.

 

The DoF had said this was something the government could afford if it wanted to ease the burden of rising oil prices and the higher value-added tax on low-income earners.

 

The rationalization of fiscal incentives, on the other hand, is a measure aimed at lifting tax and duty exemptions enjoyed by some business sectors. The DoF said the government should be giving fiscal incentives only to exporters, who contribute to the country’s foreign currency reserves, or industries that are in the infancy stage.

 

The DoF said that the government loses close to P300 billion in potential revenues every year to the grant of fiscal incentives to various industries.

 

The National Economic and Development Authority earlier said it was working for a bill that would require the national government to fund political parties.

 

NEDA Director General Romulo Neri said the objective was to prevent political parties from seeking financing from sectors that have vested interests.

 

“The executive and legislative should consult each other on what bills to push. On the part of the Cabinet, it will be useless to advocate for bills if these are not the ones prioritized by Congress,” said Beltran.

 

Beltran said it was prudent for legislators to know the objectives of the measures being pushed by the Arroyo administration. Harmonizing the objectives of the two branches of government was necessary so that time and effort to legislate a law would not be wasted on debates, he said.

 

Legislators expected to be present during the meeting of the Legislative-Executive Development Advisory Committee are Senator Francis Escudero III, chairman of the ways and means committee, and Rep. Exequiel Javier, chairman of the same committee in the House.

Diploma

DIPLOMA MILL. A Manila policeman empties a stall along Recto Avenue of books in a drive ordered by Mayor Alfredo Lim to clear the area of illegal vendors, including those who manufacture fake academic records and diplomas.INQUIRER/REM ZAMORA