Philippines” 93 Asia Brief Contributors Falls Behind 2012 Tourist PUBLISHER: Peter Wallace Target EDITOR-ECONOMICS: Bing Icamina EDITOR-POLITICS: Buddy Cunanan
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Contents THE MONTH’S HIGHLIGHTS Mining, Oil and Gas WORD FOR WORD COMMENTARY 47 Tampakan operations pushed SPECIAL REPORTS back to 2019 18 POLITICAL 47 Gov’t hopes to fi nish draft of mining bill by May 2013 18 The President signed the RH IT Update bill into law on December 21 22 19 Pres. Aquino names Marivic 48 ½ of the Philippine population Leonen as new SC justice seen own a smart phone 19 Mar Roxas to probe 48 Growth in tablet and smart Pangasinan governor’s alleged phone sales to continue involvement in ‘jueteng’ 20 Zaldy Ampatuan fi nally 38 arraigned BUSINESS CLIMATE INDEX 21 West Philippine Sea talks CORPORATE BRIEFS postponed INFRASTRUCTURE 21 Senators Legarda, Escudero top SWS survey 61 61 PH aviation safety upgrade THE ECONOMY expected soon 62 MAP proposes solutions to PH airport infra challenges 22 Filipinos more upbeat about economic prospects 65 P3-trillion investments needed 68 for suffi cient power until 23 Stock market reaches new 2030 highs in December 24 Gov’t sells $500Mn bonds to Online local investors CONGRESSWATCH h To read Philippine ANALYST online, go to http://www. wallacebusinessforum.com 68 Pres. Aquino signs 2013 h For information, send an email national budget to [email protected] or PHILIPPINE REGIONAL UPDATE [email protected] 69 President Aquino signs Sin Tax h For publications, visit our website: Reform law wallacebusinessforum.com BUSINESS 75 Asia Pacifi c Executive Brief 38 “More fun in the Philippines” 93 Asia Brief contributors falls behind 2012 tourist PUBLISHER: Peter Wallace target EDITOR-ECONOMICS: Bing Icamina EDITOR-POLITICS: Buddy Cunanan 40 PH tourists spend more for SENIOR- RESEARCH STAFF: accommodation and shopping Mae Aguinaldo 42 14 local airports to have night Joey Bondoc landing operations Ruzzella Quilla Jessica Peralta 44 Efforts for better protection Tootsie Duquiatan of intellectual property in the Francesca Rey PH PRODUCTION–LAYOUT Larry Sagun 45 PH joins ASEAN Sugar Alliance Dennis Cerda Efs Salita Philippine ANALYST December 2012 the month’s highlights 1 Political Gov’t sells $500Mn bonds to local investors The government sold $500 million worth of 10.5-year bonds on- shore on Nov. 28 in an effort to gauge the local market’s capacity PAST DEVELOPMENTS to absorb dollar-denominated debt as it tries to further reduce reliance on foreign capital markets. (see story page on p24) The President signed the RH bill into law on December 21 FUTURE DEVELOPMENTS The Senate and the House of the Representatives ratifi ed the fi nal version of the Reproductive Health (RH) Bill that would provide government funding for contraceptives and sexuality Filipinos more upbeat about economic prospects classes in schools on Dec. 17. The President signed it into law. The 3rd quarter survey of the Social Weather Stations (SWS), on Dec.21. (see story page on p18) taken on August 24-27, disclosed a net economic optimism score of +17, the highest in 4 quarters, with 31% of Filipinos Pres. Aquino names Marivic Leonen as new SC justice expecting the economy to improve over the next 12 months President Aquino on Nov. 21 appointed government’s chief peace while only 14% expecting it to worsen (the other 55% see no negotiator Marvic Leonen as Associate Justice of the Supreme change in the economic situation). (see story page on p22) Court (SC). With his appointment, Mr. Leonen has become the youngest member of the high tribunal this century. (see story page on p19) Business FUTURE DEVELOPMENTS PAST DEVELOPMENTS Mar Roxas to probe Pangasinan governor’s alleged involvement in ‘jueteng’ “More fun in the Philippines” falls behind 2012 tourist target Interior Secretary Manuel Roxas II said Dec. 14 that he has been While the world recently reached the United Nations World ordered by President Aquino to conduct a thorough investigation Tourism Organization’s (UNWTO) target of 1 billion international into the alleged involvement of Pangasinan Governor Amado tourist arrivals for 2012 in December, the Department of Espino in the numbers racket “jueteng.” (see story page on p19) Tourism’s (DOT) 2012 target for the Philippines still has a long way to go. (see story page on p38) Zaldy Ampatuan fi nally arraigned PH tourists spend more for accommodation and shopping After almost a 3-year wait, a 3rd member of the political clan accused of masterminding the 2009 Maguindanao massacre Tourists in the Philippines spent a total of P1.1 trillion on was fi nally arraigned on Dec. 12. Like the 2 other relatives tourism products in 2011, according to the National Statistical arraigned before him, Mr. Zaldy Ampatuan, former Governor of Coordination Board (NSCB). Of this amount, 89% came from the Autonomous Region in Muslim Mindanao, pleaded not guilty local tourists and most was spent in accommodation services to 57 counts of murder fi led against him and 195 others at the and shopping. (see story page on p40) Quezon City Regional Trial Court Branch 221. (see story page on p20) FUTURE DEVELOPMENTS West Philippine Sea talks postponed 14 local airports to have night landing operations The meeting of the 4 claimants in the West Philippine Sea (South In a bid to decongest key airports, the government has earmarked China Sea) to be hosted by the Philippines was postponed due approximately P1 billion for night landing operations. Final to confl icts in schedule, the Department of Foreign Affairs said. amendments to the Air Passenger Bill of Rights are expected (see story page on p21) to be released within the week to address other issues in the airline sector. (see story page on p42) Senators Legarda, Escudero top SWS survey Senators Loren Legarda and Francis Escudero remained the Efforts for better protection of intellectual property in the PH top choices for the Senate in 2013 based on the latest survey The Intellectual Property Offi ce of the Philippines (IPOPHL) is conducted by the Social Weather Station (SWS). banking on the following efforts to strengthen IP protection (see story page on p21) in the country: 1) the utilization of the Intellectual Property Automation System (IPAS); 2) Approval of amendments to the Intellectual Property Code (Republic Act 8293); and 3) Economy partnerships with state universities to create Innovation and Technology Support Offi ces (ITSO). (see story page on p44) PAST DEVELOPMENTS Stock market reaches new highs in December The Philippine stock market index reached the year’s peak of 5,832 points on Dec. 11, a 33.4% increase from 4,372 at end- 2011. And up nearly 50% since Pres.Aquino came to power. (see story page on p23) Philippine ANALYST December 2012 2 the month’s highlights PH joins ASEAN Sugar Alliance Infrastructure Three Southeast Asian countries have established a sugar alliance to strengthen the bonds of sugar industry players in the region. The positive business environment in the ASEAN mirrors the local FUTURE DEVELOPMENTS sugar sector as it has increased local sugar production, saw the decline in smuggled sugar with improved customs regulation, PH aviation safety upgrade expected soon and is set to undertake an e-payment system. The current gains of the domestic sugar sector, however, are threatened by the The government expects to successfully address by early 2013 declining rate of ASEAN Free Trade Agreement (AFTA) tariff on the country’s remaining aviation safety issues identifi ed by the sugar imports, among others. (see story page on p45) International Civil Aviation Organization (ICAO) in its latest audit. Remaining concerns are in aircraft registration and fl ight Mining, Oil and Gas safety inspection. The government further expects to obtain a positive performance rating in the fi nal ICAO audit to restore Philippine aviation’s Category 1 status as determined by the US Tampakan operations pushed back to 2019 Federal Aviation Administration, and lift the European Union Sagittarius Mines Inc. (SMI), the local arm of Swiss miner ban on Philippine air carriers. (see story page on p61) Xstrata Plc., has announced that it will further push back the Tampakan copper-gold project’s start of commercial operations MAP proposes solutions to PH airport infra challenges to 2019. The decision was prompted by the existing regulatory The Management Association of the Philippines (MAP) recently and administrative challenges faced by the company including came up with a proposal seeking to address the interlocking denial of an Environmental Compliance Certifi cate (ECC) by challenges in Philippine airport infrastructure. The proposal the Department of Environment and Natural Resources (DENR). lists MAP’s suggestions for the designation of domestic and (see story page on p47) international gateways, for structural modernization of existing facilities, and system upgrades. It is aimed towards the goal Gov’t hopes to fi nish draft of mining bill by May 2013 of setting up modernized domestic and international gateway The Mining Industry Coordinating Council (MICC), an inter-agency airports. (see story page on p62) group designated to work on the proposed law to increase government’s share in mining revenues, is eyeing to fi nish the P3-trillion investments needed for suffi cient power until 2030 draft mining bill before the midterm elections in May. One of In his presentation during the launch of Philippine Energy Plan the issues to be settled in drafting the bill is how to tax the (PEP) 2012-2030, Energy Secretary Jericho Petilla revealed mining fi rms. (see story page on p47) that at least P3.174 trillion worth of investments is needed to provide 11,400 megawatts (MW) of additional capacity for the IT Update next 18 years. The Department of Energy (DOE) also unveiled during the launch its long-term plan that would enable the country’s power supply to cope with the growth of the economy.