Saturday, May 30, 2009

Apathy as crime (Abandonment of helpless persons under the Revised Penal Code)

By Siesta-friendly

“The father, Ramon Eugenio, wept inconsolably in the small church room next to where the two small coffins lay containing the young bodies of his 3-year-old son Franco and his 2-year-old nephew Anton.

Their first family outing, on what turned out to be an overloaded boat that was to take them to Tamaraw Beach in Oriental Mindoro, had turned into a grim tragedy that saw the boat overwhelmed by waves.


What was equally rending to Ramon and his wife Monica who survived the accident was that as the boat was going down, two other vessels passed by—and did not help.

The vessels’ passengers, instead, just took pictures of the sinking outrigger motorboat carrying Ramon, his family and relatives, and scores of other people.

“I don’t know if they were afraid of being overloaded,” Ramon told the Philippine Daily Inquirer during the wake at a church in Makati City. “I was hoping they would give us help by throwing life vests but they took pictures, they took videos.”[1] [emphasis supplied]

It is hard to believe that there was something more tragic than the capsizing boat overloaded with screaming, shrieking and drowning adults and children. Yet the indifference of the passers-by is arguably more terrible.

Why wasn’t the need to help instinctive? Are we developing a culture of prioritizing bragging rights to obtaining videocam footage than to any sense of humanitarian responsibility?

We hope the apathetic passers-by can be investigated and prosecuted to curb any rising tendency to abandon the duty to help others in need. Yes, it is a duty otherwise it won’t be deemed a crime.

Abandonment of person in danger[2]

Under Art. 275 of the Revised Penal Code (RPC), the penalty of arresto mayor shall be imposed upon:

1. Any one who shall fail to render assistance to any person whom he shall find in an uninhabited place wounded or in danger of dying, when he can render such assistance without detriment to himself, unless such omission shall constitute a more serious offence.

2. Anyone who shall fail to help or render assistance to another whom he has accidentally wounded or injured.

3. Anyone who, having found an abandoned child under seven years of age, shall fail to deliver said child to the authorities or to his family, or shall fail to take him to a safe place.

Sadly, despite criminalizing apathy in these instances, the penalty of arresto mayor – from only 1 month and 1 day to a maximum of 6 months - creates another tragedy.

Failure to lend help to injured persons[3]

In the realm of criminal negligence, when an offender who, by reckless imprudence commits any act which, had it been intentional, would constitute a grave felony, “fails to lend on the spot to the injured parties such help as may be in this hand to give” is also punished in varying degrees under Art. 365 of the RPC.

Art. 365 explains imprudence, to wit:

“Reckless imprudence consists in voluntary, but without malice, doing or falling to do an act from which material damage results by reason of inexcusable lack of precaution on the part of the person performing of failing to perform such act, taking into consideration his employment or occupation, degree of intelligence, physical condition and other circumstances regarding persons, time and place.

Simple imprudence consists in the lack of precaution displayed in those cases in which the damage impending to be caused is not immediate nor the danger clearly manifest.”

The failure to lend here is best exemplified by a hit and run accident.

But why let the fear of prosecution compel us to help others in need? Lack of compassion shouldn’t need to be made a crime. Punishment, or the fear of it, shouldn’t oblige someone to have a heart.

It should be enough to just imagine if the shoe were on the other foot. If those apathetic passers-by had instead been the ones drowning … if those who speed away from accident victims had instead been the victims … or those who fail to lend a helping hand to those in need are instead the ones suffering … well, it would not be hard to imagine what apathy would then mean to them.

[1] Lopez, Allison, Virola, Madonna (2009, May 25). ‘2 boats passed by, but did not help’. Retrieved May 25, 2009, from Web site:

[2] Art. 275 of the Revised Penal Code (Act No. 3815) , December 8, 1930.

[3] Art. 365, supra.


Sunday, May 24, 2009

Tell them not to lye (Minimum Labeling Requirements under the Consumer Act)

By Siesta-friendly

Organic and natural soaps are getting to be more and more common nowadays. Though not exactly a dime a dozen, unfortunately. But what do sellers mean exactly when they say their product is ‘organic’ or ‘natural’?

Lye (a.k.a. caustic soda or Sodium Hydroxide) is a necessary ingredient in soap-making. It would be rare, if not impossible, to find soap made nowadays without lye. Thus, at best, soap may only be ‘mostly organic’ or ‘mostly natural’ soap. But that doesn’t sound catchy does it?

Did you know that papaya does not really whiten your skin? Papaya enzymes exfoliate the skin (i.e, remove dead skin cells). Using loofah or pumice stone produce the same result. But saying papaya removes dead skin is apparently not as enticing as saying it is a skin whitener.

It is really up to the consumer to know better or at least step up their inquisitive (or investigative) powers to find out the truth in sellers’ advertising claims.

But let us tell you what product advertising regulated by and pursuant to law should be. The law being the Consumer Act of the Philippines.[1]

False, Deceptive or Misleading Advertisement[2]

Don’t you just hate it when the burger on the poster is twice the size of what you actually get? Or the dish is positively scrumptious on the menu but absolutely bland once you see it?

Under the Consumer Act, it is unlawful for any one to disseminate or to cause the dissemination of any false, deceptive or misleading advertisement by mail, print, radio, television, outdoor advertisement or other medium for the purpose of inducing or which is likely to induce directly or indirectly the purchase of consumer products or services.

An advertisement is false, deceptive or misleading if it is not in conformity with the Consumer Act or if it is misleading in a material respect. In determining whether any advertisement is false, deceptive or misleading, the following are taken into account, among other things,

1) the representations made or any combination thereof,

2) the extent to which the advertisement fails to reveal material facts in the light of representations, or materials with respect to consequences which may result from the use or application of consumer products or services to which the advertisement relates under the conditions prescribed in the advertisement, or under such conditions as are customary or usual. (Just so you know, we find this phrase convoluted as well.)

Minimum Labeling Requirements[3]

All consumer products domestically sold whether manufactured locally or imported are required to indicate the following in their packaging:

b) its correct and registered trade name or brand name;

c) its duly registered trademark;

d) its duly registered business name;

e) the Philippine address of the manufacturer, importer, repacker;

f) its general make or active ingredients;

g) the net quality of contents, in terms of weight, measure or numerical count rounded of to at least the nearest tenths in the metric system;

h) country of manufacture, if imported; and

i) if a consumer product is manufactured, refilled or repacked under license from a principal, the label shall so state the fact.

In addition, the following may be required when necessary:

a) whether it is flammable or inflammable;

b) directions for use, if necessary;

c) warning of toxicity;

d) wattage, voltage or amperes; or

e) process of manufacture used.

Any word, statement or other information required by or under authority of the preceding paragraph shall appear on the label with such conspicuousness as compared with other words, statements, designs or devices therein, and in such terms as to render it likely to be read and understood by the ordinary individual under customary conditions of purchase or use. The above requirements shall form an integral part of the label without danger of being erased or detached under ordinary handling of the product.

The Consumer Act is replete with more detailed advertising requirements for food, drugs, cosmetics, devices, and hazardous substances. Best to check which ones are applicable for a particular type of product as regards their pricing, branding, packaging, promotion, sales, etc.

Back to soap: ingredients to avoid

Now, before we go, and in keeping with the ‘truth in advertising’ theme, let us give you a little more truth about soaps (and shampoos, detergents, lotions, and the like). Although, at very small quantities, they may be safe, remember that the following common commercial cleaning ingredients have been reported as toxicants or irritants and may therefore cause serious damage (if not cancer) due to prolonged or excessive use:

  1. Sodium Lauryl Sulfate (SLS) - irritant
  2. Sodium Laureth Sulfate (SLES) – toxicant/carcinogenic
  3. Cocamide DEA or Cocamide Diethanolamine (CDEA) – toxicant/carcinogenic
  4. DMDM Hydantoin - irritant
  5. Sodium Sulfite - toxicant/carcinogenic
  6. Carboxymethylcellulose (cellulose gum) - toxicant/carcinogenic
  7. Sodium Carbonate – toxicant and irritant

Check the ingredients of your bathroom products. You may be surprised at what you’ve been consuming on a daily basis. Perhaps you’ll find that having a ‘mostly organic’ or ‘mostly natural’ soap is the best you can have even if the makers do lye.

[1] R.A. 7394, April 13, 1992.

[2] Art. 110, supra.

[3] Art. 7, supra.


Friday, May 15, 2009

Bayang Magiliw … Ready? Sing. (Singing the National Anthem correctly)

By Siesta-friendly

Bayang Magiliw … Ready? Sing. We all know what comes next. We’ve all gone through Monday morning flag ceremonies in school and even in government offices, sung the anthem before watching a movie or a play, before starting some official function. We all know how the anthem is sung. Why don’t our pop singers?

They can’t say they are not aware of the law regulating how it should be sung. First: Ignorance of the law excuses no one. Second: It’s of common knowledge that no one can alter the National Anthem. You think you can alter the flag and claim freedom of expression? Certain things are obviously sacred to a nation. Case in point: there was much uproar when a local pop singer forgot the lyrics to the National Anthem. And there isn’t even any law penalizing that.

How to Sing the National Anthem

We can’t say it better than the relevant provisions themselves, namely, Sections 34 and 20 of RA 8491:[1]

Sec. 37. The rendition of the National Anthem, whether played or sung, shall be in accordance with the musical arrangement and composition of Julian Felipe. [italics supplied]

How does Julian Felipe’s composition sound like?

Sec. 20. The observance of the flag ceremony in official or civic gatherings shall be simple and dignified and shall include the playing or singing of the anthem in its original Filipino lyrics and march tempo. [italics supplied]

Still unsure? Then visit the home page of the National Heritage Institute which has uploaded the National Anthem for your listening pleasure. But most likely for everybody’s guidance. You can hear it in various instrumental and sung versions. All in the same arrangement. The same tempo.

Freedom of Expression

No freedom is absolute. Rights are curtailed by law all the time. No one can rightfully claim freedom of expression in performing a different arrangement of the National Anthem.

It doesn’t make sense to allow comparisons with other countries which are open to different versions of their national anthems. They may not have laws relevant on the matter. Although, even if they don’t regulate such singing, it is a safe bet that their citizens will raise a howl if their anthem is sung differently. Certain things are sacred, remember?

Why can we not just go back to how we’ve been trained? We were trained to sing the National Anthem and those holding the microphone are meant to lead and not take the opportunity to show off. Concert king or not.

[1] "Flag and Heraldic Code of the Philippines"or An Act Prescribing The Code Of The National Flag, Anthem, Motto, Coat-Of-Arms And Other Heraldic Items And Devices Of The Philippines. February 12, 1998.


Sunday, May 10, 2009

Doing Business in the Philippines ( BOI Incentives)

By Siesta-friendly

There are many reasons to invest in the Philippines. They could be personal: sun, sea, smiles. Or purely business: cheap skilled labor. But how does our government entice investors in the first place? The Board of Investments (BOI) in fact offers 3 classes of incentives. These incentives are: 1) fiscal, 2) non-fiscal, and 3) incentives for regional headquarters and regional operating headquarters.

But first let’s see exactly how one can be entitled to these incentives.

The Investments Priorities Plan

The IPP lists the preferred areas of investment where the investor may invest and be eligible for BOI incentives. The IPP is issued annually. At the time of this writing, the 2008 IPP[1](approved in May 2008) still applies.

The preferred areas of investment under the current IPP are classified into 4. These are:

1. Preferred Activities which cover: a) agriculture/agribusiness and fishery, b) infrastructure, c) tourism, d) research and development, e) engineered products, and f) strategic activities.

2. Mandatory Inclusions, or those required by law to be included in the IPP. These laws cover: a) Industrial Tree Plantation, b) Exploration, Mining, Quarrying, and Processing of Minerals, c) Printing, Publication and Content Development of Books or Textbooks, d) Refining, Storage, Marketing and Distribution of Petroleum Products, e) Ecological Solid Waste Management, f) Clean Water, and g) Development and Self-Reliance of Disabled Persons.

3. Export Activities namely: a) Manufacture of Export Products/Services, and b) Activities in Support to Exporters

4. ARMM List, or specific projects undertaken in the Autonomous Region of Muslim Mindanao. These cover: a) export activities, b) agriculture, food and forestry-based industry, c) basic industries, d) consumer manufactures, e) infrastructure and services, f) engineering industries, and g) ARMM priority and tourism areas.

You will have to check out the IPP for a more detailed description of each activity falling under a particular area of investment.

BOI Registration

Now, in case you intend to invest in any of the IPP activities above and avail of the incentives, you need to register with the BOI. Pursuant to Art. 32 of the Omnibus Investments Code (OIC)[2], to be entitled to registration under the IPP, you must be:

1) a Philippine citizen, if a natural person; in case of a partnership/association, you must be organized under Philippine laws and at least 60% of its capital is owned and controlled by Philippine citizens; or in case of a corporation/cooperative, you are organized under Philippine laws and at least 60% of the capital stock outstanding and entitled to vote is owned and held by Philippine nationals, and at least 60% of the members of the Board of Directors are Philippine citizens.

If you don’t possess the required degree of ownership by Philippine nationals as mentioned above, the following circumstances must be satisfactorily established:

a) you propose to engage in a pioneer project, which, considering the nature and extent of capital requirements, processes, technical skills and relative business risks involved, is in the opinion of the BOI of such a nature that the available measured capacity thereof cannot be readily and adequately filled by Philippine nationals; or, if you are exporting at least 70% of total production, the export requirement herein provided may be reduced in meritorious cases under such conditions and/or limited incentives as the BOI may determine;

b) you/your enterprise obligate yourselves to attain the status of a Philippine national within 30 years from the date of registration or within such longer period as the BOI may require taking into account the export potential of the project. A registered enterprise which exports 100% of its total production need not comply with this requirement;

c) that the pioneer area you will engage in is one that is not within the activities reserved by the Constitution or other Philippine laws to Philippine citizens or corporations owned and controlled by Philippine citizens.

2) proposing to engage in a preferred project listed or authorized in the current IPP within a reasonable time to be fixed by the BOI or, if not so listed, at least 50% of your total production is for export or you are an existing producer which will export part of production under such conditions and/or limited incentives as the BOI may determine; or that your enterprise is engaged or proposing to engage in the sale abroad of export products bought by it from one or more export producers; or the enterprise is engaged or proposing to engage in rendering technical, professional or other services or in exporting television and motion pictures and musical recordings made or produced in the Philippines, either directly or through a registered trader.

3) capable of operating on a sound and efficient basis and of contributing to the national development of the preferred area in particular and of the national economy in general; and

4) engaged or proposes to engage in undertakings or activities other than preferred projects, must have installed or undertake to install an accounting system adequate to identify the investments, revenues, costs, and profits or losses of each preferred project undertaken by the enterprise separately from the aggregate investment, revenues, costs and profits or losses of the whole enterprise or to establish a separate corporation for each preferred project if the BOI should so require to facilitate proper implementation of the OIC.

Sorry, we can’t make it any more simpler than the above. Now on to the incentives.

Fiscal Incentives[3]

Fiscal incentives fall under 6 categories which are briefly discussed below:

I. Income Tax Holiday (ITH)

BOI-registered enterprises are exempt from the payment of income taxes reckoned from the scheduled start of commercial operations, as follows:

a) New projects with a pioneer status for 6 years;

b) New projects with a non-pioneer status for 4 years;

c) Expansion projects for 3 years. As a general rule, exemption is limited to incremental sales revenue/volume;

d) New or expansion projects in less developed areas (LDAs) for 6 years, regardless of status;

e) Modernization projects for 3 years. As a general rule, exemption is limited to incremental sales revenue/volume.

Export traders may be entitled to the ITH only on their income derived from the following:

i) Export of new products, i.e. those which have not been exported in excess of US$100,000 in any of the 2 years preceding the filing of application for registration, or

ii) Export to new markets, i.e., to a country where there has been no recorded import of a specific export product in any of the two 2 years preceding the filing of the application for registration.

Plus, the following mining activities are not entitled to an ITH:

a) Exploration and development of mineral resources;

b) Mining and/or quarrying without mineral processing; and

c) Mining and processing of aggregates.

New registered pioneer and non-pioneer enterprises and those located in LDAs may avail themselves of a bonus year in each of the following cases:

a) the indigenous raw materials used in the manufacture of the registered product must at least be 50% of the total cost of raw materials for the preceding years prior to the extension unless the BOI prescribes a higher percentage; or

b) the ratio of total imported and domestic capital equipment to the number of workers for the project does not exceed US$10,000 to 1 worker; or

c) the net foreign exchange savings or earnings amount to at least US$500,000 annually during the first 3 years of operation. In no case shall the registered pioneer firm avail of the ITH for a period exceeding eight 8 years.

II. Exemption From Taxes And Duties On Imported Spare Parts

A registered enterprise with a bonded manufacturing warehouse is exempt from customs duties and national internal revenue taxes on its importation of required supplies/spare parts for consigned equipment or those imported with incentives.

III. Exemption From Wharfage Dues And Export Tax, Duty, Impost And Fees

All enterprises registered under the IPP are given a 10 year period from the date of registration to avail of the exemption from wharfage dues and any export tax, impost and fees on its non-traditional export products.

IV. Tax Exemption On Breeding Stocks And Genetic Materials

Agricultural producers are exempted from the payment of all taxes and duties on their importation of breeding stocks and genetic materials within 10 years from the date of registration or commercial operation.

V. Tax Credits

1) Tax credit on tax and duty portion of domestic breeding stocks and genetic materials - A tax credit equivalent to 100% of the value of national internal revenue taxes and customs duties on local breeding stocks within 10 years from date of registration or commercial operation for agricultural producers.

2) Tax credit on raw materials and supplies - A tax credit equivalent to the national internal revenue taxes and duties paid on raw materials, supplies and semi-manufacture of export products and forming part thereof shall be granted to a registered enterprise.

VI. Additional Deductions from Taxable Income

1) Additional Deduction for Labor Expense (ADLE) - For the first 5 years from registration, a registered enterprise shall be allowed an additional deduction from taxable income equivalent to 50% of the wages of additional skilled and unskilled workers in the direct labor force. The incentive shall be granted only if the enterprise meets a prescribed capital to labor ratio and shall not be availed simultaneously with ITH. This additional deduction shall be doubled if the activity is located in an LDA.

2) Additional deduction for necessary and major infrastructure works - Registered enterprises locating in LDAs or in areas deficient in infrastructure, public utilities and other facilities may deduct from taxable income an amount equivalent to the expenses incurred in the development of necessary and major infrastructure works. The privilege is not granted to mining and forestry-related projects which naturally locate in certain areas so as to be near their sources of raw materials.

Non-Fiscal Incentives

The non-fiscal incentives are as follows:

I. Employment Of Foreign Nationals - A registered enterprise may be allowed to employ foreign nationals in supervisory, technical or advisory positions for 5 years from date of registration. The position of President, General Manager and Treasurer of foreign-owned registered enterprises or their equivalent are not be subject to the foregoing limitations.

II. Simplification of customs procedures for the importation of equipment, spare parts, raw materials and supplies and exports of processed products.

III. Importation of consigned equipment for a period of 10 years from date of registration, subject to posting of a re-export bond.

IV. The privilege to operate a bonded manufacturing/trading warehouse subject to Customs rules and regulations.

Incentives for Regional Headquarters (RHQ) and Regional Operating Headquarters (ROHQ) in the Philippines

RHQ are entitled to the following incentives:

I. Exemption on the Payment of Corporate Income Tax - An annual information return of a tax-exempt corporation must be filed with the Bureau of Internal Revenue (BIR) to effect exemption.

II. Exemption on the Payment of Value-Added Tax - The exemption includes the sale or lease of goods and property including the rendition of services to RHQ.

ROHQ, on the other hand, can avail of the following incentives:

I. On Corporate Income Tax - Income derived by the ROHQ from performing qualifying activities are subject to a preferential rate of 10% on taxable income.

II. On Branch Profit Remittance Tax - Any income derived from the Philippines when remitted to the parent company shall be subject to the tax on branch profit remittances.

III. On Value-Added Tax - ROHQ are subject to 10% value-added tax unless otherwise provided under the National Internal Revenue Code.

Following are the exemptions common for both RHQ and ROHQ:

I. Exemption on the Payment of All Kinds of Local Taxes, Fees, or Charges. But payment shall be made for real property tax on land improvements and equipment.

II. Tax and Duty Free Importation of Training Materials and Equipment are applicable to materials not locally available, subject to prior BOI approval.

III. Sale or disposition of equipment within 2 years after importation, entered tax and duty free, requires prior BOI approval and prior payment of applicable taxes and duties.

IV. Entitlement to Importation of New Motor Vehicles and subject to the payment of the corresponding taxes and duties.

Finally, under RA 8756[4], the following incentives are given to expatriates of a registered RHQ/ROHQ in the Philippines:

I. Multiple Entry Visa - issued to expatriates, their respective spouses and unmarried children under 21 years old. A non-immigrant visa shall be issued within 72 hours upon submission of all required documents.

The multiple entry visa is be valid for 3 years and extendible for another 3 years upon submission to the Bureau of Immigration of a sworn certification by a responsible officer of the RHQ/ROHQ that its license to operate remains valid and that it complied with all requirements stipulated under relevant Philippine laws.

II. Withholding Tax of 15% on Compensation Income is applied to both alien and Filipino executives holding managerial or technical positions.

III. Tax and Duty Free Importation of Personal and Household Effects is applicable on imports made within 90 days before or after conversion of the alien executive's admission category to multiple entry visa.

IV. Travel Tax Exemption - issued by the Philippine Tourism Authority upon recommendation by the BOI during the period of the expatriate's assignment in the country.

We think the incentives are worth it. We also think not a lot of people are aware of these benefits. So give them a good read. In case you want to know more, you may just inquire with the BOI. We can’t give you any more info without already billing you for it =)

[1] 2008 Investments Priorities Plan. Retrieved April 28, 2009, from Philippine Board of Investments Web site:

[2] Executive Order No. 226, July 16, 1987.

[3] Fiscal Incentives. Retrieved April 28, 2009, from Philippine Board of Investments Web site:

[4] “An Act Providing For The Terms, Conditions And Licensing Requirements Of Regional Or Area Headquarters, Regional Operating Headquarters, And Regional Warehouses Of Multinational Companies, Amending For The Purpose Certain Provisions Of Executive Order No. 226, Otherwise Known As The Omnibus Investments Code Of 1987”, November 23, 1999.


Sunday, May 3, 2009

Reading between the lines of the ADB’s recent evaluation of the Philippines (The Asian Development Outlook 2009: Southeast Asia Chapter)

By Siesta friendly

The ADB, unlike a lot of our government officials, are a diplomatic and politically correct lot. They churn out country reports about 2x a year discussing the ups and downs of a country’s economic data but without directly dissing anyone. Below is an effort to decipher what the ADB meant in their recent report on the Philippines. The ADB report with subtitles, if you like.

The translations may entirely be the outcome of our fertile imagination.

Brief Summary and Forecast

ADB Statement: GDP growth slowed sharply in 2008, largely reflecting the effects of decade-high inflation on consumption and of weakening global demand for exports. The Government has eased fiscal and monetary stances and plans a stimulus package. These moves should mitigate the slowdown caused by a forecast decline in exports and sluggish domestic demand, and help protect the poor. But they will not prevent a slide in growth this year.

Translation: Let’s not kid ourselves: 2007 was an election year which brought about the unusually high GDP growth, but now it’s back down to reality. The government’s handouts to help the poor are superficial and really not meant to have any permanent effect.

Review of 2008

ADB Statement: Hampered by a surge in inflation and weaker external demand, GDP growth slowed to 4.6% in 2008 from 7.2% in 2007.

Translation: Remember the record-breaking billion peso spending for the May 2007 elections? Well, those days are gone.

Statement: Gross national product, which includes remittances from nearly 9 million Filipinos working abroad, decelerated to 6.1% from 8.0% last year. These remittances rose by 13.7% to $16.4 billion last year, or by about 9% in peso terms, helping support consumer spending. However, rising prices for food and fuel squeezed such spending, which accounts for about 77% of aggregate demand, slowing its growth to 4.5%. Still, private consumption contributed most to GDP growth from the demand side.

Translation: Everything will pretty much be at a standstill without OFW money.

Statements: Growth in government consumption spending also ebbed, partly owing to a high base effect from election spending in 2007.

Fixed capital investment decelerated sharply to 3.7% growth last year, from 11.8% in 2007, mainly because of a slowdown in public construction from the high level seen in the 2007 election year.

Translation: You didn’t think the government would spend much for its people outside an election year did you?

Statement: Private construction maintained double-digit expansion, assisted by housing investments from overseas workers.

Translation: When we say “assisted”, we mean “caused largely by”, otherwise we wouldn’t have highlighted OFWs in the first place.

Statement: Public construction activity contracted after rapid growth in 2007.

Translation: You know those bridges and roads are only made to get your votes, right? No election year? No public construction then.

Statement: Agriculture (including fisheries and forestry) grew at a 3-year low of 3.2%, as a result of much higher fertilizer and fuel costs.

Translation: Where on earth is the fertilizer fund?! Tell your president this is where funding is much needed, not in travelling abroad to pimp your countrymen for overseas work. Nor in buying legislators’ votes … Nor in lining one’s pockets ….

Statement: Looking to ensure rice supplies, the Government increased its purchases on the international market in the first half of 2008, when prices were particularly high.

Translation: See? If your government only supported the agriculture sector, you’ll still be a major rice producer, if not exporter. And, definitely would not have spent a high price for rice.

Statement: [T]he trade deficit [went up] to $12.6 billion, from $8.4 billion a year earlier.

Translation: Sorry, OFWs are not counted as export products so you’re importing much more than you’re exporting.

Statement: Inflows of remittances helped keep the current account in surplus, although that surplus fell to $4.2 billion (2.5% of GDP). The surplus in the capital account likewise was sapped by portfolio investment outflows, and inflows of foreign direct investment fell to $1.5 billion.

Translation: If you don’t get it yet, without OFW money, you’re in deep %&$#. Stock market players and direct investors have already lost their interest in you.

Statement: Gross international reserves rose to $37.6 billion at end-2008, largely on account of government borrowing abroad and a revaluation of gold assets in line with higher world bullion prices. Reserves climbed further by February 2009 to $38.9 billion (6.2 months of import cover and 4.6 times short-term external debt based on original maturity), reflecting proceeds from a government bond issue, loans from multilateral development banks, and privatization of the National Power Transmission Corporation.

Translation: We’re just telling you how much money you have but can’t have, if you know what we mean.

Statement: After reining in the fiscal deficit over several years, the Government changed tack in 2008 given [the] need to provide more help to vulnerable groups hit by much higher food and fuel prices.

Translation: Having spent most of its era using much of its revenues to pay for mounting – and questionable - foreign debt, the government only now starts pro-poor programs. We’re sure it’s just pure coincidence that next year is an election year. Wink.

Statement: Job creation remained lacklustre - average employment growth slowed to 1.6% in 2008 from 2.8% in 2007. The unemployment rate rose to 7.7% in January this year from 7.4% a year earlier, when underemployment was around 18% of the workforce.

Translation: Don’t tell us you believe the government’s rosy employment data.

2009 Prospects

Statements: The outlook is for a further deceleration in economic growth in 2009 as global demand weakens for both exports and workers from the Philippines, damping consumption and investment.

Consumer spending, though benefiting from the downtrend in inflation, is projected to grow by just 3.0%. That is because remittance inflows will likely flatten in US dollar terms as labor markets weaken worldwide. The number of workers going abroad last year rose until November on a year-on-year basis, but then fell by 5.8% in December Furthermore, the domestic labor market is waning as export industries, among others, trim headcounts, alongside the prospect of an influx of unemployed overseas workers. The National Economic and Development Authority, the official development planning body, estimates that about 800,000 workers at home and abroad are vulnerable to losing their jobs.

Translation: Brace yourselves folks, it can only get worse. The OFWs are coming home.

Statement: [H]igher public spending will support economic growth. The Government in January this year announced plans for a P330 billion ($6.9 billion) economic stimulus package. About 50%, or P160 billion will come from budget appropriations in 2009 to expand welfare programs, such as cash transfers to poor families as well as labor-intensive infrastructure projects that can be quickly implemented, including road maintenance, reforestation, and classroom building. Another 30%, or P100 billion, is for large infrastructure projects to be funded by government corporations and the social security system.

Translation: Okay, just between us, the first sentence should start with “We hope” and the entire paragraph is meant as a checklist for you to keep tabs on what government should be doing.

Statement: Amounts raised from the scheduled sale of more state-owned assets will depend partly on the state of financial markets.

Translation: What government owns 3 nationwide tv stations? And it’s too late to unload them now when they’re not likely to command a good price.

Statement: The national government debt has fallen significantly in recent years, from the equivalent of 77.7% of GDP in 2003 to 56.3% in 2008. However, the debt is still high and interest payments absorb a quarter of total expenditure. Moreover, contingent liabilities — mainly guarantees issued by the National Government – add a further $11.2 billion to the debt (Figure 3.28.11).

Translation: The Arroyo government’s obsession with repaying debt is surpassed only by its obsession with assuming more debt.

Statements: Domestic risks to the economic outlook include delayed implementation of the stimulus package due to capacity constraints.

[I]f the global economy does not pick up as assumed, the Government will be hard pressed to fund additional fiscal stimulus measures, given its budget constraints.

Translation: Tell your government officials to stop dipping their hands in the national coffers. There’s really not much left.

Statement: Social programs to protect the poor sometimes lack funds and often require better targeting.

Translation: Mike Arroyo and his cronies should not end up with the funds.

Statement: Still-high debt and the large share of interest payments in the budget expose the economy to swings in financial markets. They also underscore the importance for the Government of containing the debt risk premium through making steady progress on reforms. Further increases in revenue as a share of GDP and reductions in debt would not only reduce vulnerabilities but also build the fiscal resources needed for infrastructure and social programs.

Translation: Governments normally use revenues to fund their infrastructure projects and social programs. Your government is more known for continuously using revenues to pay for debt while incurring more debt. In case you haven’t noticed.

Statement: The 2008–2009 Global Competitiveness Report of the World Economic Forum ranks the Philippines 71 out of 134 countries and identifies inefficient government bureaucracy, inadequate infrastructure, policy instability, and corruption as important constraints.

Translation: In case you don’t believe our report, we took it upon ourselves to give you a 2nd opinion.

SOURCE: Asian Development Outlook 2009: Southeast Asia Chapter. Retrieved April 7, 2009, from Asian Development Bank Web site: