Manila Standard Today, 23 May 2014
By Lailany P. Gomez
The Transportation Department will look into the proposed P2-billion parallel runway to be built along the existing strip at the Ninoy Aquino International Airport.
Transportation Secretary Joseph Emilio Abaya said Thursday the proposed alternative runway was included in the letter that conglomerate San Miguel Corp. submitted to the agency regarding its proposed $10-billion airport project.
âYes, it was included in the letter. In fact, we spent so much time disucssing that alternative runway,â Abaya told reporters at the sidelines of the 23rd World Economic Forum.
The proposed parallel runway will be built south of the current main runway with an estimated cost of P2 billion for the government.
Abaya, however, said at least 600 households would be affected if the parallel runway was built along the existing one.
âProbably our biggest challenge is the households that will be affected. Weâre still verifying if they are informal settlers or private land owners. So, I think at the end of the day, thatâs going to be the biggest challenge as to its quick execution,â Abaya said.
âThe plan is the government will finance the relocation. So we need help from the [Department of Public Works and Highways] and [National Housing Authority] since we are not an expert in relocation. Weâre also checking with [International Civil Aviation Organization]. They are saying that when you have a precision landing certified runway and you build another runway parallel to it, you will lose the certification. We donât want this to happen,â Abaya said.
San Miguel and Philippine Airlines assured that the proposed parallel runway would not remove the certification because the same was applied at the Los Angeles International Airport.
âWeâre gathering data. We want to see how they did the layout. We will let the Civil Aviation Authority of the Philippines do this. We just want to make sure that the precision landing accreditation is not compromised,â Abaya said.
San Miguel last week presented to President Benigno Aquino III the proposed $10-billion airport that would be built on a portion of Manila Bay.
The project is being designed to have four runways capable of handling 150 million passengers annually and accommodating 250 takeoffs and landings per hour.
San Miguel added the new airport would require high-quality highway and rail links to the main central business district within Metro Manila.
Manila Standard Today, 23 May 2014
ByÂ Julito G. Rada
The Trade Department said the Philippines may not fully comply with the open-skies policy in Asean scheduled by the end of 2015 because of the limited capacity of its main gatewayâthe Ninoy Aquino International Airport.
Trade Secretary Gregory Domingo said at the sidelines of the World Economic Forum on East Asia in Makati City that the Philippines was in the thick of negotiations with other Asean members countries on the matter.
âThe problem with the Manila airport is the unavailability of slots. It is already congested. Naia has overcapacity in terms of both the runway and the slots in the terminals. That is why we canât open it even if we want to,â Domingo said.
He said the situation in Manila was in stark contrast with those in other Asean countries, where their main gateways had undercapacity.
âIn other Asean countries, their main airports in the capitals are already okay [ready for open skies]. However, their airports outside the capitals are not yet ready. So that is in contrast to our situation here in the Philippines,â Domingo said.
âSo that is where we stand,â Domingo said. âObviously, we want to open it up but there could be limitations in terms of capacity,â Domingo said.
Domingo cited some pressures from airline companies but âwe have to decide on what is the best position for the country, but that is DoTCâs [Department of Transportation and Communications] job, not my job.â
Open skies is an international policy concept that calls for the liberalization of the rules and regulations of the international aviation industry to create a free market environment for the airline industry.
Pocket open-skies policy is currently in effect in the Philippines, but with the exclusion of Naia. President Benigno Aquino III signed Executive Orders 28 and 29 earlier, which liberalized the entry of foreign airlines.
The directive aims to increase tourist arrivals in the country, attract more investments and spur competition in the local aviation industry.
Malaya Business Insight, 23 May 2014
By Angela Celis and Irma Isip
The Philippines will continue to close its main gateway, the Ninoy Aquino International Aiport under the âopen skiesâ of Asean which takes effect next year according to Trade Secretary Gregory Domingo.
Domingo during a lull in the discussions at the World Economic Forum on East Asia admitted to reporters âpressure from local airlinesâ to keep NAIA closed to international airlines.
Finance Secretary Cesar Purisima also explained to delegates that the country needs to ease first the congestion at the Ninoy Aquino International Airport before it can be opened as the key entry point from the open skies being negotiated by the 10 economies in Asean.
In a related development, Transport and Communications Secretary Joseph Emilio Sevilla said the government will build a second runway at the NAIA that will cost P2 billion, as an immediate solution to the congestion.
Domingo said: âwe are part of the open skies (agreement in Asean) but our stand is our open skies is all ports outside Manila,â
Purisima said infrastructure bottlenecks in the aviation industry must first be addressed before pushing for open skies policy on a national scale.
Purisima said yesterday NAIA is a problem aching to be solved immediately.
(As if to make a bad situation worse, air conditioning failed in Terminal I and III for about two weeks. Â Terminal II built by Lucio Tan for Philippine Airlines remains comfortable)
âThe challenge really is congestion in Manila so we need to fix the infrastructure (if) we want to have more connections,â Purisima said at the forum on East Asia Economic Outlook.
Purisima politely suggested open skies policy will attract more foreign airlines and increase the number of tourists only if the airports are comparable to those in Asean region. Â The Federal Aviation Authority of the US has raised to 1 the category of the NAIA from 2. Â The upgrade directly relates to safety.
Congestion is a different problem.
The Aquino administration adopted a pocket open skies policy, which liberalized the countryâs secondary international airports by allowing more foreign carriers to fly and bring in more tourists.
âItâs okay to take small steps as long as you continue to take the right direction,â the finance chief added.
Tony Fernandes, AirAsia CEO, said during the forum there is great potential in the Asean region.
âWeâre moving in the right direction, but thereâs still a lot to be done. Open skies is one thing, but there are still a lot of invisible barriers,â Fernandes said.
âThereâs a disconnect between policymakers and what the private industry thinks. The communication has to grow between the private sector and the government,â he added.
Meanwhile Purisima said he is confident the Aquino administration will succeed in pushing through with its planned reforms in the last two years of its term.
âThe good thing about President Aquino is that he is extremely popular. He has the political capital to make sure that on the last two years of his term, he will follow through with the reforms,â Purisima said.
âWhatâs important is we have set the foundations. We canât finish it all in six years. But the important thing is the opportunity is there. Thatâs why weâre optimistic,â he added.
Meanwhile, the alternative runway will be located in the South of the main current runway, Abaya said the biggest challenge is the relocation of the 600 households that will be affected .
NAIAÂ has only one runway that currently handles commercial aircraft takeoff and arrival of 40 events per hour its lower compared three years ago of 52 to 56 events per hour. But , NAIA still operating beyond its capacity limit of 36 events per hour. NAIA handles 625 flights daily.
At the session on Connect on Trade:Lifting Barriers to Growth, Singapore Senior Minister of Finance Josephine Teo said when Asean opens its skies next year, demand for air traffic will grow, driven by a growing middle class in Asia and specifically in Asean who are now interested and can afford to travel.
Open skies will allow Asean airlines to fly with fewer restrictions within the region and according to Teo, Asean could consider the EU aviation as a reference point.
She said while there is today overcapacity among low cost airlines, it is a matter of timing that demand would grow and multiple links and direct city links are needed to satisfy the travelling preferences of people in Asean.
The benefit, Teo added, would be in reduced cost of air transport passenger and freight.
âBut thisÂ goes beyond idea of single aviation for the market and demand for air travel but also because of the tremendous effort on harmonizing regulatory requirements.â
She admitted though that challenges many Asean economies face is in the overcapacity of their airports and need to invest in airport infrastructure to expand the capacities.
Teo also broached the idea of considering liberalizing air transport agreement (ATA) as a bloc with other countries like what it forged with China.
Teo said there is a potential for a region to region ATA between Asean and EU.
Manila Standard Today, 23 May 2014
ByÂ Joyce Pangco Panares
Aquino says govt inclusive growth goal now doable
EAST Asian leaders called Thursday for stronger efforts to achieve inclusive growth and social mobility for the poor, as well as closer ties among neighboring states amid territorial tensions that could disrupt the regional economy.
At the opening of the World Economic Forum-East Asia summit, President Benigno Aquino III highlighted the collective role of ordinary Filipinos in making inclusive growth an irreversible trend in the Philippines.
âThe pursuit of large-scale reforms in every aspect of governance is the achievement of the Filipino people. They made the goal of achieving inclusive growth doable, and it is also they who will make it irreversible,â he said.
The President said the government will not stop at helping the poorest of the poor through interventions such as the conditional cash transfer program, and said even those considered ânear poorâ must also be protected.
âWe have expanded the scope of our efforts and are now likewise targeting those who are deemed ânear poorâ — or those who are one catastrophic illness or one natural disaster away from going below the poverty threshold. Our goal: To push them further and further away from the poverty line, and to empower them to improve their own lots in life,â he said.
âOur people are the be all and end all of this government, and we are not content with waiting for the benefits of growth to just trickle down the social pyramid,â the President added.
Aquino said governments must strive to create opportunities for ordinary people, citing his administrationâs aggressive promotion of tourism, which he said âachieves inclusivity almost instantly.â
âThe results are clear: From 2001 to 2009, the term of my predecessor, the average annual growth of international tourists arrivals was at 5.1 percent; under our watch, from 2010 to 2013, this number grew to 11.6 percent,â he said.
âConsidering that, on average, every international tourist spends almost a thousand dollars in the Philippines, the impact of our tourism efforts on our local economies has been nothing less than profound,â the President added.
Aquino said the Filipino peopleâs support to his anti-corruption and governance reforms policies have also contributed to the countryâs strong economic performance.
âFor the past four years, through the unwavering support of our people, we have enacted reform after reform. We overhauled systems that were prone to abuse,â he said.
Aquino also played up the efforts of his administration to hold accountable those who have misused public funds, and pointed to the prosecution of his predecessor, former President and now Pampanga Rep. Gloria Arroyo, and the ouster of former chief justice Renato Corona.
âMy predecessor is now undergoing hospital arrest as she undergoes two serious charges, with another being evaluated by the Ombudsman. The Congress and the Senate removed a chief justice from office for failing to declare over 98 percent of his assets in his Statement ofAssets and Liabilities and Net Worth contrary to our Constitution and our laws,â he said.
âWe pursued all those who committed wrongdoingâregardless of their power, wealth, or influence. As you may have guessed, tangling with these very wealthy individuals and sectors with vested interests was not an easy task. But those in our administration were not shaken: Dismantling the culture of corruption was a promise we made to the people.â
âIf we truly wanted to improve the lives of our people, we could not possibly shirk away from this challenge. We had to take on all those who had a misplaced sense of entitlementâwho believed that they had more rights than their fellow Filipinos. So, we went after every individual who committed wrongdoing,â the President added.
About 600 participants from 30 countries and more than 460 business leaders are attending the WEF-East Asia summit, which has the theme âLeveraging Growth for Equitable Progress.â
The countryâs gross domestic product grew by 7.2 percent last year, and 6.8 percent in 2012, but former Budget secretary Benjamin Diokno said it was still âtoo earlyâ to declare the Philippines as Asiaâs next economic miracle.
âTwo years of strong economic growth do not make a miracle. It has to be sustained growth of say 7 percent for 10 years. We cannot be sure that economic growth can be sustainable and inclusive,â Diokno said in an earlier interview.
Indonesian President Susilo Bambang Yudhoyono stressed the need to promote socio-economic mobility through entrepreneurship.
âEconomic growth and equitable progress are not necessarily the same thing…There will always be those who are wealthier than others. But the problem is when mobility is only for the few,â he said.
âWe live in an extraordinary era. Weâre in the midst of a revolution. (But) despite Asiaâs epic progress, this revolution remains incomplete…A key challenge in addressing inequality is that those in the bottom and middle should enjoy the same benefits as those in the top,â Yudhoyono added.
Vietnamese Prime Minister Nguyen Tan Dung warned that Chinaâs aggressive actions over overlapping territorial claims in the region could disrupt growth in East Asia.
âVietnam strives for stability. But risk is rising as regional disputes evolve with complexity…Economic development will not thrive without peace and stability,â Nguyen said.
âChinese actions are threatening peace and stability in the region, and freedom of navigation… Disruption will impact on the world economy and may even reverse the trend of global growth,â the Vietnamese leader added.
Myanmar Vice President U Nyan Tun said âpositive relationshipsâ among East Asian nations can lead to increased economic growth in the region.
The Philippine Star, 23 May 2014
By Marichu Villanueva
MANILA, Philippines – Industrialist Jaime Augusto Zobel de Ayala cited the Philippinesâ economic growth over the past three years, making it now one of the leading economies in East Asia.
The Makati business leader highlighted the gains of the Philippine economy in brief remarks at the welcome reception Wednesday night for foreign and local delegates participating in this yearâs World Economic Forum (WEF) on East Asia being hosted by the Philippines for the first time.
Even while the global arena remains volatile, Zobel noted âthe Philippine economy continues to outperformâ the rest of the East Asian economies, with the countryâs gross domestic product (GDP) posting the highest growth in the region. The country also recently earned investment upgrades from international risk rating agencies.
âWe have demonstrated our economyâs resilience against external forces, geo-political events and natural disasters,â Zobel said.
âTruly, the Philippines may finally be finding its place among the leading economies in the region,â he added.
âWe are here at Tower One and Exchange Plaza, in the heart of the Makati business district, which only 50 years ago was a rice field,â Zobel, chairman and chief executive officer of Ayala Corporation, the flagship of the Ayala Group, pointed out.
Taking note of the presence of Vice President Jejomar Binay, Zobel paid tribute to the âpartnershipâ of the Ayala Group and government leaders in the transformation of the city of Makati.
âWith the strong engagement and partnership of Vice President Jejomar Binay, over his 21 years as mayor of Makati â and followed today by his son, Mayor Junjun Binay â together we have developed Makati into a world class city that we can all be proud of. This is a legacy of Ayala Corporation, a testament to our pioneering spirit and our commitment to nation-building,â Zobel said.
He also told the audience the Ayala Group is celebrating its 180th anniversary this year.
âWe are proud to have been an integral part of building our nation over the last two centuries,â Zobel said, adding, âWe celebrate our history and our achievements, but more importantly, we celebrate where we are going, as a country and as a nation.â
In his remarks, Binay offered the âwarm hospitalityâ of the Filipino people to the WEF delegates.
âDespite the temperature outside, we offer you the balmy interiors of our meeting rooms and convention halls where you may engage in genial but earnest discourse in the next two days of the World Economic Forum on East Asia,â Binay said.
âAs we all know, not only is East Asia, and Southeast Asia specifically, warming up in terms of economic and trade activity with the rest of world, it is in fact heating up,â he added.
Binay told his audience the region is one year away from achieving a common market through the ASEAN Economic Community.
At present, he cited, the Philippines is constantly accelerating interaction with its global trading partners.
âIn the middle of all this, of course, is the hotter economic comeback of the Philippines, whose economy is expected to be the strongest performing in South Asia in 2014, with a GDP growth exceeding 6.5 percent,â Binay pointed out.
But he admitted a nagging question remains: âWhat does this all mean for our population? How do we translate economic growth into employment for the many, and the improvement of social services? How can acceleration in trade and economic activities accelerate sustained human amelioration?â
He said these are challenges that the delegates should find answers to in the next two days of the forum.
The Filipino-themed reception featured the best of Filipino culture, cuisine and artistry.
On show were fine furniture by artisans from Manila, Pampanga and Cebu, a video presentation of the Philippinesâ best, a fashion show featuring the works of some of the countryâs best designers and performances by Louie Ocampo, Lani Misalucha, the Ramon Obusan Folkloric Troupe, Steps Dance Studio and The Brat Pack.
The Philippine Star, 23 May 2014
By Teresa Cerojano
MANILA, Philippines â An Asian Development Bank official warned Thursday of a largely unnoticed crisis in Southeast Asia: private investment in infrastructure has not recovered in the nearly two decades since the Asian financial crisis.
Stephen Groff, ADB Vice President for operations, said in an interview on the sidelines of the World Economic Forum on East Asia, that private funding for infrastructure in five of the biggest Southeast Asian members has declined steeply. It was $38 billion in 1997 and around $25 billion in 2010.
“It’s coming up but it’s nothing like it was in 1997,” he told The Associated Press. “Essentially, the ASEAN financial crisis led to a crisis of confidence with governments, a crisis of confidence in the private sector, and there hasn’t been enough investment or discussion or development of tools that allow risk-sharing to be used appropriately.”
The five members he referred to were Indonesia, Malaysia, the Philippines, Thailand and Vietnam. The other members are Singapore, Cambodia, Laos, Myanmar and Brunei.
Groff said while private investors assume risks, there are other types of risks that governments and financial institutions need to assume “and that hasn’t yet come into play as much as it needs to.”
The region, which will launch next year a common market comprising 600 million people, needs to spend $60 billion yearly until 2020 to meet its infrastructure needs. But Groff said ASEAN currently spends only about half that.
He said while there has been some progress in a number of countries in recent years in helping facilitate private investments in infrastructure by addressing legal and regulatory issues that restrict private participation, the process is not easy and takes time.
There is a need to think about financing interest mechanisms, mechanisms to mitigate risks, developing bankable projects that attract private investments and bringing back home the region’s extra savings that have been invested in low-yielding treasury bonds in the U.S. and Europe, he added.
To bring back some of those funds, the ADB has helped develop the ASEAN Infrastructure Fund which began lending last year. Two infrastructure projects in Indonesia have been funded while more projects throughout the region are in the pipeline, Groff said.
The fund is being managed by the ADB, with funding coming from ASEAN members and the bank.
Indonesian Finance Minister Muhamad Chatib Basri said infrastructure is the “first priority” for his country after it had established political stability under outgoing President Susilo Bambang Yudhoyono.
However, he said the ” main challenge in the future is not only sustainable growth but also shared growth.”
Philippine Finance Secretary Cesar Purisima said the region’s relatively young population, natural resources and its geographic location are factors that would contribute to growth. But to make sustainable growth a reality the “capital surplus region” has to make more infrastructure investments, he added.
“We have the money … but we need to make our financial markets more efficient and more connected,” he said. “Governance is the most important ingredient because businesses want predictability, want open economy, want to be able to reduce the risks.”
Business World, 22 May 2014
Regional leaders and speakers at the ongoing World Economic Forum on East Asia in Makati City highlighted gains that have been made so far — from regulatory reforms to curbing corruption — but noted that countries faced similar challenges involving infrastructure, governance and even food security.
Philippine President Benigno S. C. Aquino III, keynoting the afternoon plenary session, touted gains made in the first four years of his administration — from above-target economic growth and resulting credit ratings upgrades to the detention of his predecessor, Gloria Macapagal-Arroyo, on corruption charges.
The same themes were expounded by Cabinet officials who spoke at earlier sessions, including Finance Secretary Cesar V. Purisima and Budget Secretary Florencio B. Abad.
Similar reforms were presented by Indonesian President Susilo Bambang Yudhoyono, Vietnamese Prime Minister Nguyen Tan Dung and Myanmar Vice-President Nyan Tun.
At a morning session focusing on the regionâs prospects, the upcoming economic integration of ASEAN was cited as a means of addressing barriers to development and stability, including the ongoing political crisis in Thailand and territorial disputes with China — seen as risks to investment.
Highlighting the heightened tensions over Chinaâs claims to the South China Sea, Vietnamâs Mr. Dung blasted the regional power for âslanderingâ his country, and Klaus Schwab — the Forumâs founder — while stressing that the organization was not taking sides, said there was a need to âresolve this situation which has potential to create a situation we do not want.â
âWE HAVE TO CHANGE…â
Mr. Schwab, returning the discussion to the issue of growth and equitable progress, said the biggest challenge for the world, and not just the region, was âsocial inclusion.â
âWe have to change the way we run our economies,â he said.
âIncome inequality has been getting worse across the world for the past 30 years,â Lee Il-Houng, G20 Sherpa and ambassador for international cooperation of South Korea, noted earlier in the day.
Mr. Aquino was in agreement, saying in his speech that â[i]nclusive growth cannot be delivered by simply delivering the services… [that the people] deserve.â
Mr. Yudhoyono called for âmobility for allâ, while Mr. Dung said âdomestic reform must be coupled with regional integration.â
Mr. Schwab said it didnât matter if the viewpoint was glass half full or glass half empty, only that the âglass is still growing… there is more water [in it].â
The morning session on East Asiaâs economic outlook also cited long-standing development gaps.
âWe need to invest in infrastructure to assure our connectivity with each other and the rest of the world,â Mr. Purisima told forum participants.
Among others, he noted that the Philippinesâ infrastructure backlog has hindered the country from implementing an âopen skiesâ policy, which would relax aviation restrictions that currently provide local players an advantage over foreign rivals.
âThe challenge really is congestion in Manila, so we need to fix, of course, infrastructure,â Mr. Purisima said.
Mr. Purisima was responding to a comment by AirAsia Group Chief Executive Officer (CEO) Anthony F. Fernandes in the same session that many Southeast Asian economies have been moving in the right direction by taking steps toward an âopen skiesâ policy. At the same time, Mr. Fernandes noted: âOpen skies is one thing, but many invisible barriers still exist.â
Mr. Purisima also highlighted infrastructureâs role in supporting agriculture, which in the Philippines accounts for a third of the work force but contributes less than a fifth to national output.
ââThere is need for sectoral interventions, in particular, in agriculture,â Mr. Purisima noted.
âAnd here infrastructure takes that role. Rice facilities, storage facilities, irrigation — we need to invest [in those],â he stressed, adding: âWe need to give [farmers] better access to technology.â
âIf we succeed in doing that, we improve the overall competitiveness of the country.â
Mr. Fernandes echoed Mr. Purisimaâs view later in the session, urging governments to âallow businesses to grow by facilitating them by providing the right infrastructure.â
Infrastructure, however, is not the only issue casting a shadow on the regionâs otherwise upbeat outlook.
In an opening press conference, Forum co-chairs Takeshi Niinami, chairman of Lawson, Inc., and James T. Riady, CEO of Lippo Group in Indonesia, cited risks posed by current geopolitical tensions.
âTensions are real and this impacts directly and indirectly business enterprises,â Mr. Riady said at the press conference.
âCapital markets reflect that immediately.â
Mr. Niinami stressed, however, that business must not take a back seat to territorial disputes.
âWe have to focus on the business first, then politics follows,â he said.