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Photo from skythewolf.wordpress.com

 

The COMP recently warned that affected mining companies could file arbitration cases should the government not honor mining contracts. It said that a number of these are foreign mining firms that have bilateral investment treaties (BITs) and they could sue the government for compensation. The DENR previously announced the cancellation of 75 mineral production sharing agreements (MPSAs), and plans to close 23 mines and suspend five others.

According to IBON, international arbitration is an instrument of investment liberalization, which corporations use to unhamper and secure their profit-seeking to the detriment of countries’ sovereignty in determining what is in the best interest of its people. The World Bank International Centre for Settlement of Investment Disputes (ICSID), for example, is known for siding with transnational corporations (TNCs) and strictly enforcing decisions that include expropriation of assets, said the group.

This mechanism is further institutionalized under free trade deals (FTAs), said IBON. Countries negotiating the Regional Cooperation Economic Partnership (RCEP), for instance, can be sued by investors whenever it is perceived that government policy, law or action harms present and future profits.

IBON’s recent mining study shows that extractive companies have a history of suing governments through international arbitration when their profits are compromised. For example, American oil company Occidental Petroleum Corporation cost Ecuador US$1 billion when the government expropriated Occidental’s assets after it illegally sold its rights to another company. Mining company Pacific Rim, a subsidiary of Australian miner OceanaGold since 2013, sued the government of El Salvador for US$301 million for denying the permit for the El Dorado mine due to environmental concerns.

IBON urged the Duterte government to stand firm on DENR’s order to protect the country’s remaining natural and mineral resources. The closure order will give a respite to the massive drain of mineral resources and the destruction of ecosystems. The group also stressed that government should revoke existing bilateral agreements that allow big local and foreign businesses to plunder the nation’s mineral wealth and that secure corporate interests mechanisms such as international arbitration.###

Housing Pandi

As the National Housing Authority serves eviction notices to members of urban poor organization Kalipunan ng Damayang Mahihirap (KADAMAY) who have occupied long-vacant and dilapidated relocation units in Pandi, Bulacan, research group IBON said that the so-called socialized housing largely benefits private developers through public-private partnerships (PPPs). These private realty and construction firms garner profits and incentives from public-funded housing while much-needed homes remain inaccessible for poor Filipinos. The group said that the Duterte administration should uphold Filipino people’s right to decent and affordable shelter and reverse housing privatization.

IBON said that the so-called socialized housing has considerable profit potential for private realty and construction firms. The Class D market where informal settlers belong is largely untapped and expanding, providing numerous opportunities for big housing developers. The government estimated a housing backlog of 800,000 units per year or a total of 5.8 million units from 2010-2016. The World Bank also stated that the Philippines has one of the highest rates of urban population growth among poor countries.

The Philippine Development Plan (PDP) 2017-2022 indicates that the Duterte government intends to continue the previous administration’s implementation of a housing program through PPPs, observed IBON. Private developers will continue to amass profits from “socialized” housing through guaranteed payments from the government.  They will also continue to enjoy a number of incentives, including 30% off on taxable income from profit, which is granted when a real estate project is negotiated as part of socialized housing compliance to Republic Act (RA) 7279 or the Urban Development and Housing Act (UDHA), said the group.

RA 7279 likewise states that the private sector will be exempted from paying the following: capital gains tax on raw lands used for the project; value-added tax for the project contractor concerned; transfer tax for both raw completed projects, and donor’s tax for lands certified by the local government units to have been donated for socialized housing purposes. IBON said that these incentives make it easier for private companies to do business and profit while monthly housing amortization burdens millions of low-income homeless families.

IBON noted that major players in the development of supposedly low-cost housing units include Ayala Land, Inc. (ALI) which constructed 7,276 units in 2012 and another 14,070 units in 2013. Phinma Property Holdings Corp. is another major player, and was behind government relocation projects such as Quezon City Mayor Herbert Bautista’s Bistekville, and Mayor Strike B. Revilla’s Grand Strikeville 4 in Bacoor, Cavite.

Despite government and private sector claims, these “socialized” housing units remain unaffordable and unattainable for many informal settlers, said the group. A Bistekville unit, for example, does not require a down payment, but still has an amortization of Php2,273.84 per month over a period of 30 years. Many informal settlers are struggling to meet their families’ daily basic needs, and are also ineligible for housing loans from the Home Mutual Development Fund (HMDF) and Pag-IBIG.

IBON said that shelter is a human right, which government has a responsibility to ensure and uphold. The Duterte administration should prioritize the development of sustainable, decent, as well as free and affordable housing in consultation with urban poor communities. The group said that government should revert the housing program from a profit-making venture to a genuinely government-controlled social service.###

 

 

BtalkYrend201602

Download “Change Underway” IBON Yearend 2016 Birdtalk briefing paper here

“Filipinos have long organized and struggled for meaningful wage hikes, ending contractualization, land, free or at least affordable social services, national industrialization, and many other urgent demands. These are all part of the aspiration for a truly independent, democratic and prosperous Philippines. The people can support any administration reforms that are in their interest. Or, absent such reforms, the people can push a progressive reform agenda while continuing to oppose any anti-people measures. In the end, the progressive forces for change and their struggles remain the strongest foundations for democracy and development in the country – continued struggle including seizing  opportunities as they arise only makes these stronger.”

— Dimming Prospects/ IBON Yearend 2016 Birdtalk

 

CaserAndConsumers

Filipino consumers are reportedly optimistic.

Hear consumer groups discuss their plight from utilities to food, transport and more and where these stand in supposed peace talks’ substantive agenda on social and economic reforms.

What: A Conference on the Comprehensive Agreement on Social and Economic Reforms and Consumers’ Welfare

When: February 27, 2016 1pm

Where: Sikat Events Studios Place #305 Tomas Morato near Popular Bookstore

Request for coverage. Interviews and photo opportunities will be available.

THANK YOU.

 

From Tapat News

The Philippines remains backward and underdeveloped with severe inequality 31 years after the so-called EDSA revolution, research group IBON said. The Duterte administration’s new Philippine Development Plan 2017-2022 will not change this, said the group, in continuing the failed neoliberal policies of the Marcos regime and all subsequent administrations.

EDSA 1986 was a repudiation of the Marcos dictatorship including economic crisis and gross inequality from neoliberal economic policies then pushed by the International Monetary Fund (IMF) and World Bank. The people mobilized in their millions to end not just the dictatorship but also economic crisis and gross inequality. This was clearly expressed in the 1987 Constitution, IBON noted, where nationalist economic provisions articulated the people’s aspirations for social justice and for a sovereign and independent economy.

According to IBON, these are among the promises of EDSA not met in the succeeding 31 years. There has not been any change and, instead, the economy has continued to deteriorate and worsen as a mere appendage of global capitalist powers exploiting our cheap labor, raw materials, and markets.

Domestic agriculture and Filipino industry are in terminal decline. From 1986 to 2016, the share of agriculture and manufacturing in Philippine gross domestic product (GDP ) has shrunk from 24.8% to 22. 8% and 17.1% to 8.4 percent, respectively. A few have prospered while the majority remain in severe poverty. At present, IBON estimates 2 of 3 Filipinos surviving on only Php125 or less per day, while official poverty statistics indicate 21.9 million living on a very low poverty threshold of Php60 per day.

The Duterte administration’s new Philippine Development Plan (PDP) 2017-2022 unfortunately continues the failed neoliberal policies started by Marcos in the late 1970s and followed by all the administration’s that came after it. In final controvertion of the promises of EDSA, it also seeks to remove the important nationalist provisions of the 1987 Constitution. The economy and the people will suffer the worst for this even as domestic elites and foreign monopoly capitalist powers continue to prosper, IBON said.

The PDP 2017-2022 of the government’s neoliberal economic managers adopts the same market-oriented framework of the policies that have failed to develop the Philippine economy. Like past administrations, it gives premium to luring in foreign direct investments, spending on infrastructure, strengthening public-private partnerships (PPP) that channel public funds to private gain, and implementing a fiscal program that relieves the rich while taxing the poor more. On the other hand it is silent on measures for real national development such as free land distribution and Filipino industrialization, decent jobs and wages, and free or affordable social services, said IBON.

The nationalist economic aspirations from EDSA are still relevant and if anything have been affirmed over the last 31 years, said the group. The government’s unchanged neoliberal policies will only widen the gap between rich and poor and keep the economy as a mere provider of cheap labor and raw materials for the global economy and a captive market. These neoliberal economic policies need to be reversed for the Filipino people to achieve their aspirations for development, IBON concluded.

 

 

From Mindanao Interfaith Institute for Lumad Studies

Contrary to claims that closing down mining operations will worsen poverty, research group IBON said that large-scale mining activities impact heavily on marginalized sectors and intensify poverty. The group also said that the mining sector’s export-oriented character further deprives communities by taking away potential resources for local development.

The Employers’ Confederation of the Philippines (ECOP) said that the crackdown on mining would lead to ‘expansive poverty’ and hurt economic growth. This was in response to the Department of Environment and Natural Resources (DENR) head Regina Lopez’s recent orders to close and suspend some mining operations and cancel 75 mining contracts.

According to a study by IBON, however, mineral extraction and production often incur significant social and environmental costs which in fact fall disproportionately on the poor. In 2009, mining had the highest poverty incidence among industry groups at 48.71%. This was the highest poverty incidence since 1988, even surpassing the agriculture sector, which has historically topped poverty incidence across industries.

Among the biggest mining operations in the country are the Taganito Mining Corp in Surigao; Nickel Asia in Eastern Samar; Sagittarius Mines Incorporated in South Cotabato, Filminera Resources Corp. in Masbate and TVI Pacific Inc in Zamboanga del Sur. Yet, IBON noted that official 2015 poverty statistics show that regions hosting these mining activities are the poorest, next only to the Autonomous Region of Muslim Mindanao (ARMM). Poverty incidence among individuals in Caraga (Region XIII) is the second highest in the country at 39.1 percent. The Eastern Visayas (Region VIII) posted the third highest poverty incidence at 38.7% followed by Soccsksargen (Region XII) at 37.3%, Bicol (Region V) at 36.0% and Zamboanga Peninsula (Region IX) at 33.9 percent.

Mining industry statistics also indicate that most of Philippine mineral production goes to exports, IBON observed. Total production value in mining in 2015, for instance, was at Php179.7 billion. Meanwhile, the amount of total exports of minerals and mineral products was at Php131 billion in the same year, or 73% of total production value. The exodus of minerals from the country leaves very little or nothing for local industry to benefit from. This means a lack of raw materials for potential industries such as steel, cement, rubber, paper, chemical and pharmaceutical.

IBON said that for allowing the extraction and export of most of the country’s mineral wealth while poverty remains stark in regions with mining activities, the Philippine Mining Act of 1995 should be repealed. The group said that government should not heed the mounting pro-big-business mining hype and instead focus on saving and utilizing what is left of the country’s resources to genuinely benefit the nation, especially the poorest regions.

 

 

Siltation

Research group IBON said that despite strong opposition from mining companies, the Duterte government should stand firm on the Department of Environment and Natural Resources (DENR) head’s order on mines closure. The group also belied mining companies’ claims that large scale mining has brought development to the country.

President Duterte has expressed support for DENR secretary Gina Lopez’ order to close down 23 mining firms and suspend five more due to grave violations against the environment. Ordered closed were Benguet Corp. Nickel Mines Inc., Ore Asia Mining and Development Corporation and Benguet Corporation and four other mining companies in Luzon, 10 in Vizayas and seven in Mindanao.

​Lopez has also ordered the cancellation of 75 mining contracts. ​

The Chamber of Mines of the Philipines (COMP), meanwhile, composed of the country’s mining firms, has questioned the closure and warned of the massive jobs and revenue losses that it will entail. Finance secretary and Mining Industry Coordinating Council (MICC) co-chairperson Carlos Dominguez also cautioned that the DENR orders would cost affected local governments millions in foregone revenues.

IBON however refuted that large-scale mining has been beneficial to the economy. It said that for instance, while mineral exports hit a high US$3.4 billion in 2013,  mining contributed a measly 0.7% to gross domestic product (GDP) in the same year. The sector’s contribution grew to this level only from 0.5% after more than a decade of operations. The annual average share of mining revenues to total government revenues in 2009-2012 was only 1.18 percent, the group added. The contribution of the mining and quarrying sector to employment was also negligible at 0.7% of total employment.

IBON also noted the string of mining disasters since the enactment of the Philippine Mining Act in 1995. Aside from human deaths, large-scale mining has caused damaged dams, soil and water pollution due to excessive tailings, siltation, contamination and damage to agricultural lands, fish kill and other damages to marine life, buried or damaged houses in tailings and flash floods, isolated villages, dust fallout and air pollution, massive evacuation and various illnesses. Moreover, said the group, more than 90% of Philippine mineral production is exported for use by other countries’ steel industries while the country has none. This, despite the Philippines being one of the world’s top producers of gold, copper and nickel.

Government should uphold the mining ban, IBON said, and be wary of opposition coming from certain members of the cabinet involved in the mining sector, which could derail efforts to advance the people’s interests.

The closure and suspension orders is a positive step for the protection of the Philippine environment and towards ensuring that the country’s natural resources benefit the Filipino people, the group added. Various groups are pushing for the resumption of the peace talks as these principles are represented in the negotiations’ social and economic reforms agenda. ​###

From Ebizload

The Manila Electric Co. (Meralco) recently said that it aims to expand its prepaid customers by 100,000 from the current 40,000 this year. Kuryente Load (KLoad), the utility giant’s prepaid electricity service, is presently available in Mandaluyong, Manila, Pasig, and parts of Rizal. Meralco now plans to offer KLoad to customers in Caloocan, Makati, Marikina, Pasay, Pateros, San Juan, and Taguig.

Pilot tested in 2013 and commercially rolled out in 2015, KLoad allows customers to save up to 20% in consumption, or so Meralco avers. But looking past this dodgy claim, KLoad is nothing more than the worst form of the neoliberal tenet “users pay”.

The scheme deepens the exclusion of the poor from access to electricity as a basic service and their right to decent living. As the Energy Department once said, prepaid electricity helps “consumers not unnecessarily spend for what they cannot afford”.

How it works

A user must have Meralco’s “intelligent” meter installed first and register a mobile number for the account. Through SMS (‘text’) using the registered mobile number, the user can load KLoad cards worth as low as Php100 and as high as Php1,000.

The user will receive a text message confirming that the amount has been loaded successfully to his or her account. KLoad also lets users receive text notifications on the account’s remaining balance, low load reminder, and rate adjustments. Like prepaid cards for mobile, KLoad cards can be bought even at retail stores.

For Filipinos who have long been accustomed to prepaid mobile service, KLoad is pretty easy to grasp. In fact, it is this familiarity with and preference for prepaid mobile that Meralco banks on for its KLoad. Saddled with tight budget, most Filipinos use prepaid mobile to control spending.

Lack of a steady income, in fact, forces many to buy in tingi not just mobile credits but most of their daily needs – from shampoo to 3-in-1 coffee. The same concept supposedly applies to prepaid electricity.

The problem is it’s not quite the case.

Rising power rates

Under the KLoad system, retail rates will be the same as the effective postpaid rate at the particular month the load was consumed. Unconsumed credits in a given month will be charged with prevailing rates in the following month.

Unlike in prepaid mobile and other consumer goods where charges are more or less predictable, electricity rates vary monthly (often upwards). The reason is deregulation under the Electric Power Industry Reform Act of 2001 (Epira), which allows automatic adjustments in the generation charge and other periodic adjustments.

The fluctuating rates make it difficult for a household to effectively monitor and regulate their consumption, and accordingly plan their use of electricity based on prepaid credits.

But far more crucially, the ever-increasing power rates will offset efforts by a household to cut their electricity bill even when they shift to KLoad. No matter how much kilowatt-hour that a household tries to reduce in their consumption, the end result is still an exorbitant electricity bill.

Meralco’s own commissioned survey in 2016 shows that its rates are the third highest in Asia. An average Meralco customer is also paying 4.5% of their disposable income for electricity, higher than the global average of 3.9 percent.

Aside from deregulating rates, Epira also privatized the country’s power plants. In Luzon where Meralco operates, just three groups (i.e., San Miguel, Lopez, and Aboitiz) control 70% of power generation. Such tremendous control makes alleged collusion and price rigging easier like during power plant shutdowns that lead to rate spikes.

In March this year, for instance, Meralco said that its rates are set to rise by as much as Php1.44 per kWh purportedly due to Malampaya maintenance shutdown from 28 January to 16 February. Other power plants will also be on maintenance shutdown on 13-17 February, placing more pressure on power supply and rates.

Anti-consumer, anti-poor

Instead of addressing these policy issues, the onus of coping with rising electricity costs is further passed on to hapless consumers under the prepaid system. With KLoad, no prepaid credits, no electricity. Disconnection is automatic, done remotely by Meralco. It’s that straightforward and heartless.

Through remote and automatic disconnection when credits run out, KLoad violates the rights of Meralco customers as outlined in the Magna Carta for Residential Electricity Consumers. These rights include the right to due process and notice prior to disconnection and suspension of disconnection.

Prepaid customers are supposed to be notified via text three days before the remaining load is estimated to run out. The warning shall be based on the average consumption of the household. But what if the household used more electricity than their average consumption and depleted the load in two days instead of three?

KLoad primarily targets poor communities where collection of monthly bill is problematic and illegal connection is prevalent. A prepaid system for these households ensures that bills are paid to and collected by Meralco. As explained by the Energy Regulatory Commission (ERC), prepaid electricity reduces pilferage and improves collection efficiency and cash flow for distribution utilities.

Meralco has an existing partnership with the National Housing Authority (NHA) to provide KLoad service to urban poor families resettled from waterways and danger areas in Metro Manila. Recently, in a Tondo slum, Meralco installed KLoad for former Smokey Mountain residents.

Notably, prepaid system is among the supposed best approaches to slum electrification that the US Agency for International Development (USAID) endorsed in its 2004 study that also included Meralco as one of the cases.

Affront to decent living

KLoad is part of the long-term plan of Meralco to install the so-called Advanced Metering Infrastructure (AMI) – an integrated system of intelligent meters – in its franchise area. The AMI will allow Meralco to, among others, remotely switch on and off the supply of electricity not only to prepaid customers but also those with regular connection.

Access to electricity is needed to achieve the minimum standard of decent living. Thus, it should not be contingent upon the ability of people to pay and must be a basic right guaranteed by the state. KLoad and Meralco’s remote and automatic disconnection system is a blatant affront to this right.

KLoad will set a worrisome precedent if not questioned and opposed. It is prepaid electricity today. Prepaid water soon? ###

 

MinWageCASER

Pres. Rodrigo Duterte recalled the government’s peace negotiators from negotiations with the National Democratic Front of the Philippines (NDFP) until being given “compelling reason” to resume talks. Research group IBON, however, points out that the most compelling reason for having peace talks are the economic and political reforms on the agenda that can address the roots of armed conflict. Ending the peace talks with the NDFP also ends talks on important social and economic reforms which makes the prospects for their implementation and achieving benefits for the people dimmer.

IBON noted that ceasefires are at most only momentary respites from fighting. The government and the NDFP reaching agreements on genuine reforms, on the other hand, are among the clearest steps towards peace based on social justice. The government and NDFP each prepared their proposed draft for a comprehensive agreement on social and economic reforms (CASER) and exchanged these in mid-January 2017. IBON reviewed these and compared their respective proposals for key reforms.

IrrigationCASER

Pres. Rodrigo Duterte recalled the government’s peace negotiators from negotiations with the National Democratic Front of the Philippines (NDFP) until being given “compelling reason” to resume talks. Research group IBON, however, points out that the most compelling reason for having peace talks are the economic and political reforms on the agenda that can address the roots of armed conflict. Ending the peace talks with the NDFP also ends talks on important social and economic reforms which makes the prospects for their implementation and achieving benefits for the people dimmer.

IBON noted that ceasefires are at most only momentary respites from fighting. The government and the NDFP reaching agreements on genuine reforms, on the other hand, are among the clearest steps towards peace that is based on social justice. The government and NDFP each prepared their proposed draft for a comprehensive agreement on social and economic reforms (CASER) and exchanged these in mid-January 2017. IBON reviewed these and compared their respective proposals for key reforms.

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