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Instrument of accession to the Istanbul Convention for ATA Carnet awaits President’s approval 

The instrument of Philippine accession to the Customs Convention on ATA Carnet for the Temporary Admission of Goods or the Istanbul Convention is now at the Office of the President for his signature.

The ATA Carnet system is an international scheme that will allow temporary admission and tax-free and duty-free importation of commercial samples, professional equipment and articles for presentation or use in trade fairs, shows, and exhibitions without customs formalities.

The system will also allow traders to use ATA Carnet secured by an international guarantee system. The ATA Carnet is a single document of goods that will pass through several customs territories and will be valid up to one (1) year. It will foster free movement of goods between countries, thus saving costs and time in clearing goods at the border. Failure to re-export all goods listed on the Carnet will result in the payment of applicable duties.

The Department of Finance (DOF), in a letter to the Department of Foreign Affairs (DFA) dated 8 August 2019, requested the preparation of the Instrument of Accession subject to certain conditions. It also underscored that the Convention will “help promote efficiency, consistent with the Administration’s policy of promoting ease of doing business and efficient service delivery.”

Relevant government agencies such as the Department of Trade and Industry (DTI), Bureau of Customs (BOC), Bureau of Internal Revenue (BIR), Department of Tourism (DOT) and Tariff Commission signified their support by submitting their respective Certificates of Concurrence (COC) to the DFA through the DOF.

Once signed by the President, Senate ratification through the concurrence of at least two-thirds of its members is constitutionally required. The Convention provides that it shall enter into force three months after the Philippine has deposited its Instrument of Accession.

The implementation of the ATA Carnet system will support the Office of the President Memorandum Circular (MC) No. 27 which directs “all concerned agencies to strengthen the implementation of the Philippine Export Development Plan and involving other agencies in the development of the export sector”. Specifically, MC 27 mandates the DFA to advocate the Philippine Accession to the Istanbul Convention.- ARB

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Exporters continue to benefit travel tax exemption thru EO 589

The Export Development Council (EDC) in partnership with the Tourism Infrastructure and Enterprise Zone Authority (TIEZA) continuously supports Philippine Exporters by giving travel tax exemption incentives through Executive Order (EO) 589 for the past 12 years.

Said EO only exempts exporters joining international trade fairs, exhibitions, selling missions, conferences, trade negotiations, seminars and other promotion activities, from paying the travel tax amounting to Php 1,620 for economy class and Php 2,700 for business class.

Since 2007,  EDC has endorsed 13,174 Travel Tax Exemptions (TTEs) applications to TIEZA which issues the exemption certificates. From the total TTEs issued 87% are for joining international trade fairs, 10% for outbound business and selling missions and  3%  for other participation i.e. conferences, seminars and promotions activities.

Exporters are still encouraged to avail of this government support.  The TTE application form can be downloaded at http://edc.net.ph/downloads/TTEform.pdf.

For other concerns and information on tax exemptions not covered by EO 589, you may call TIEZA at telephone numbers 249.5900 locals 641/646/643.- MGL

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BSP amends regulations on Foreign Exchange transactions

BSP amends regulations on Foreign Exchange transactions

The Bangko Sentral ng Pilipinas (BSP) conducted a briefing on the amendments to its Manual of Regulations on Foreign Exchange (FX) Transactions last 06 August 2019 at the BSP Assembly Hall in Manila.

Deputy Director Jodeth Niña Yeung discussed in details the recent amendments to BSP’s Manual of FX Regulations. Highlighting that these new policy reforms made the country’s FX regulatory framework further liberalized. In fact, according to Chinn-Ito Financial Index (2016), the Philippines’ FX flow openness index remains higher compared to ASEAN neighbors: Malaysia, Indonesia, Thailand and Vietnam. Because of BSP’s facilitative and more liberalized regulations, FX transactions are now more streamlined and simplified.

The amended FX regulations include the following major reforms:

  1. Lifting of prior BSP approval requirement for purely private sector FX loans. Henceforth, companies need only to register.
  2. Replacement of a positive list to a general policy requirement for loan purposes that can be funded with proceeds of foreign currency loans. FX transactions need only be legitimate, not contrary to laws, regulations, public order, public safety, or public policy.
  3. Lifting of BSP registration for certain short-term private sector loans, provided these are duly reported to BSP.
  4. Lifting of the USD 60,000.00 Daily limit on FX sale by depository banks for the balance of peso deposit accounts of non-residents.
  5. Migration to electronic submission of supporting documents, from previous hard copy requirement.
  6. Broadened coverage of inward investment transactions from previous two (2) categories: foreign direct investments and portfolio investments, to three (3) new categories, namely: instruments issued by residents, non-residents, and other forms of investments.
  7. Expansion of the list of banks allowed to register investments on behalf of BSP.
  8. Provision of a grace period of one (1) year from effectivity of the implementing Circular to file applications for registration of investments, regardless of the date of funding.

BSP underscores that these reforms are significant leaps that will allow foreign investors, public and private entities, and overseas Filipinos to have more flexibility in managing their foreign currency transactions and investments.

However, BSP despite its continuing efforts to further liberalize FX regulations, the banks may still adopt internal policies and are expected to exercise due diligence in compliance with these amendments. –EPV

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NEF speakers dispels human labor displacement myth by robots

The 9th National Education Forum (NEF) was held last 29 August 2019 at Hotel Jen, Pasay City. Attended by distinguished speakers and panelists from the government, academe, and industry, the forum discussed the impact of the Fourth Industrial Revolution (4IR) in business, work and our daily lives as well as offer solutions and insights on how to go about meeting the challenges imposed by this technological transformation.

The speakers and panelists alike discussed the pros and cons of the 4IR. Ms. Riza Mantaring of the Management Association of the Philippines (MAP) discussed the wonders of the hologram technology- an image that appears to be three dimensional and can be seen with a naked eye. As an advanced technology, holograms can also perform operations and surgeries outside operating rooms in any country.

Dr. Eduardo Ong of PCCI discussed the creation of a global village through social media revolution embodied by Facebook, Twitter and others that has given everyone a voice and a way to communicate instantly across the world. Such innovations can bring access to products and services to entirely new markets and can give people more opportunities to learn and earn in new ways.

Other speakers showed that digital technology can free workers from automation tasks, freeing them to concentrate on addressing more complex business issues and giving them more autonomy. It can also provide workers with new tools and insights to design more creative solutions to previously insurmountable problems.

Of the negative effects of such industrial transformation, the speakers and panelists agreed that being always connected can turn into a liability, with no respite from the continuous overload of data and connections. Dr. Marvin Adolfo of PMAP pointed out, “human beings will become lazy and live a distanced life through screens, while ignoring the world in front of them. Relations will lose value as most of us now have become busy on our social media life and there is now the prevalence of fake news, voice and facial reorganization, etc, which are regarded as ethical concerns. Further, there are risks of machines overpowering humans as portrayed in movies such as Terminator and I Robot.”

However, there are ways forward in dealing with the negative effects of the 4IR. Our government should take steps to ensure that we are able to capitalize on the 4IR rather than the receiving end of it. Hence, collaborative effort like the government-academe-industry linkages is very critical. First and foremost, we need to improve the quality of education and training in order to create more skilled persons which automatically reduce the risk of losing jobs. Government also needs to focus on increasing markets from priority sectors in order to increase the country’s economy.

Thus, the forum concludes that as a country, we need to shape a future that works for all of us by putting people first and empowering them. In its most pessimistic, dehumanized form, the 4IR may have the potential to “robotize” humanity and thus deprive us of our heart and soul. But we, as human beings can complement it through the best parts of human nature- that is- creativity, empathy and stewardship or teaching or coaching- which separates us from the “robotic stance” and uplift humanity into a new collective and moral consciousness based on a shared sense of values and destiny. It is incumbent for us as humans to make sure the latter prevails.- GTM

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EDUCATION AND TRAINING: At the heart of PH 4.0 economy

Education and training will play a very critical role in the country’s technological transformation, this according to speakers and panelist during the 9th National Education Forum held at Hotel Jen last 29 August 2019.

PHILEXPORT President, Mr. Ortiz-Luis, emphasized the importance of “government officials, educational institutions, business leaders, and policymakers in pushing forward advocacies on education such as 4.0 workforce readiness, strengthening government-academe-industry linkages as well as best practices on multi-skilling workforce and plotting the ways forward in future-proofing work in the Philippines.”

Meanwhile, Dr. Eduardo Ong, PCCI Chairman for Education, stressed that “the government, specifically those in the education and training sectors, shall continuously push for an enabling education environment that propels industrial revolution and economic resiliency.” It is the responsibility of the government to make sure that the value of partnerships and collaborations shall be undertaken at all levels, in all sectors, with emphasis to fulfill the mission of uplifting the quality of education in the country”.

Moreover, Dr. Ong said “Örganizations like the Philippine Chamber of Commerce and Industry (PCCI), the Export Development Council (EDC), PHILEXPORT and the Employers Confederation of the Philippines (ECOP) are all working on policies towards identifying the breadth of jobs that are likely to be threatened by this technological advancement. Noting for example is the rapid progress in Artificial Intelligence (AI), which indicates a much broader range of jobs than previously thought could be carried out by machines. Therefore, the Commission on Higher Education and other government agencies shall make sure that essential policies shall bring up symmetrical balance so that we will not be worried about automation affecting employment in the country.”

It was also highlighted that as one country, we should believe in the reality that jobs of the future will be the ones that machines can’t do and it is fair to say that anything that can be measured or is based on rules will be automated- an idea which means, we can automate the work and humanize the job. This also means that technology cannot always do the work alone- most of the time, it still needs human intervention.

Hence, it is beyond doubt that education is at the heart of preparing our future and present generations to thrive in a technologically advanced world. As a result, it is vital that we have an educational institution that develops human potential rather than pits it against machines; an education system designed for an industrial economy that is now being automated requires transformation; and from a system based on facts and procedures to one that actively applies that knowledge to collaborative problem-solving.

The said forum was organized by the PCCI Education Committee in collaboration with the EDC-Networking Committee on HRD and supported by PHILEXPORT.- GTM

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Logistics stakeholder presents update to improve logistics industry

The President of Multimodal and Logistics Association Inc. (PMTLAI) Ms. Marilyn C. Alberto, reported during the 2nd Logistics Services Philippines Conference and Exhibition (LSPH) that the issuance of the Joint Administrative Order (JAO) which focuses to address the problems on high shipping cost and port congestion will be the “long term solutions to the problems that affects the logistics services ability to enable business competitiveness.”

The JAO was spearheaded by the Department of Trade and Industry (DTI), Department of Transportation (DOTr), who already signed the JAO, as well as Department of Finance (DOF), together with the Bureau of Customs (BOC), and Philippine Port Authority (PPA).  DTI Secretary Ramon Lopez remarked during his keynote speech that the JAO will be transformed into an Executive Order (EO).

Since the pronouncement of the JAO, PPA issued a detailed regulation thru PPA Administrative Order (AO) 002-19, addressing the transfer of overstaying import shipments in Manila South Harbor and Manila International Container Terminal to maintain the utilization rate.

Likewise, BOC also issued a Customs Memorandum Order (CMO) 13-2019 that provides the interim guidelines on the return of the empty containers at the Port of Manila and Manila International Container Port to avoid port congestion; also stating that the international shipping lines must ensure sufficient containers space for their empties.

The 2nd LSPH organized by the DTI was held last 15 July 2019 at the Philippine International Convention Center. – KJC   

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EDC recommends legislative priorities for the 18th Congress

The Export Development Council (EDC) through its Networking Committee on Legislative Advocacy and Monitoring (NCLAM) has prioritized the export sector’s legislative agenda for the 18thCongress to have a more competitive export industry.

EDC supports the amendment of the Public Service Act (PSA) to have a clear statutory definition of public utilities and public services.  Also, the measure aims to provide greater competition and investment and lower costs to support the flow of goods and services.

On transport and logistics, some of the recommendations include the Amendment of the Philippine Ports Authority (PPA) and Civil Aviation Authority of the Philippines (CAAP) Charter in order to separate the regulatory and operator functions of both agencies.

On trade financing, EDC advocates the amendments to Republic Act 9501 (Magna Carta for MSMEs) to provide an extension of the mandatory allocation of credit resources to set aside 10 percent of their loan portfolio for lending to MSMEs. The amendments will also strengthen the Small Business Corporation (SB Corp.), both in terms of capitalization and exemption from Bangko Sentral ng Pilipinas’ supervisory powers.

There is also a proposal for the amendment of Republic Act 8172 (ASIN Law). EDC acknowledges that there is a need to clarify an exemption in all salt incorporated in export food products.

The EDC- NCLAM as mandated in the Export Development Act aims to assist in the effective implementation of the Act through advocacy of necessary legislative actions that shall promote Philippine exports. The Committee is composed of members from both the relevant public and private sector. –MDGTD

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Government agencies mandated to implement programs for export development

In a Presidential Memorandum Circular (MC) No. 62 approving the Philippine Export Development Plan (PEDP) 2018-2022, concerned government agencies are mandated to implement their respective programs, activities and projects (PAPs) relevant to the PEDP.

Specifically, these agencies “shall implement policies, programs, and action plans to boost export growth and ensure the free flow of goods, in accordance with the Philippine Export Development Plan and Philippine Development Plan (PDP)”.

The “PEDP is synchronized with the period of PDP to harmonize the implementation of programs and to the continuity and consistency of policies and innovative strategies for boosting export growth and increasing job opportunities for Filipinos”.

The Department of Trade, Foreign Affairs, Agriculture, Energy, Environment and Natural Resources, Health, Finance, Information and Communication Technology, Interior and Local Government, Public Works and Highways, Transportation, Tourism, Labor and Employment, Tourism, TESDA, CHED, BSP and NEDA are among the agencies mandated to strengthen the implementation of the Plan.

On 26 June 2019, President Rodrigo Roa Duterte signed the MC No. 62 approving the PEDP 2018-2022 and directing the foregoing agencies to ensure its implementation. PKC

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DTI, DOTR, DOF to issue JAO regulating the international shipping charges

In a recent pronouncement, DTI Secretary Ramon Lopez stated that the Departments of Trade and Industry, Transportation and Finance will issue the Joint Administrative Order (JAO) that will regulate local charges imposed by international shipping lines.

The draft JAO was already signed by the Trade Secretary and still need to be co-signed by the Secretaries of Finance and Transportation.

While the JAO is still to be signed, the Bureau of Customs (BOC) and Philippine Ports Authority (PPA) has already issued orders resulting to normalizing utilization rate of container depots in Manila ports back to 70%.

Specifically, the BOC issued Customs Memorandum Order 13-2019 in February which “disallowed brokers, importers, truckers and other port stakeholders to return empty containers within the premises of Manila International Container Port (MICP) and Port of Manila (POM) beginning February, until further notice”.

On the other hand, the PPA issued a directive stating “all importers, consignees, owners, and shippers of containers already cleared by BOC are notified to withdraw said containers within fifteen (15) days and shall be compelled to transfer these containers to a designated port or inland container depot at their cost”.

Hence, this facilitated the transfer of overstaying containers to Batangas and Subic Ports with the cooperation of the port operators.

International Shipping Lines, for their part, are being required to promptly evacuate empty containers from the Manila ports within the prescribed period given by BOC, either by regular ship calls or sweeper vessels.

Secretary Lopez also assured the government is addressing the infrastructure needs of the country with its aggressive infrastructure program. MJAA

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Develop domestic airports for sustainable tourism and trade 

The Department of Tourism recognizes the importance of developing domestic airports in improving competitiveness and enhancing sustainable growth both in tourism and trade. It is also highlighted that the airports are not just gateways but more of economic growth drivers. This objective is included in the National Tourism Development Plan (NTDP).

AnchorDuring the 4th Annual Philippine Airport Modernization and Expansion Summit, DOT Undersecretary Arturo Boncato, Jr. shared that the tourism sector generated more than 5 million employment and 12.2% contribution to GDP in 2017. Initial data shows that there are about $ 8 billion income generated from tourist arrivals in 2018.

The development of secondary gateways and provincial airports is one of the advocacies of the Export Development Council. By doing so, congestion in the capital, especially in the immediate and medium term, will be reduced, which in turn will mean lower travel cost for passengers.

To date, there are only 19 night-rated airports in the country. According to the Civil Aviation Authority of the Philippines (CAAP), the additional airports with Airfield Lighting System (ALS) are the following: Bohol/ Panglao Principal Airport, Subic Bay International Airport, Tuguegarao Principal Airport, and Naga Principal Airport.

The airports to be provided with ALS this year (2019) and currently being processed are the following: Cotabato Principal Airport, Cauayan Principal Airport, Dipolog Principal Airport and Pagadian Principal Airport.

The other recommendations for the domestic airport development are: (1) Modernizing the infrastructure and facilities of the domestic airports to accommodate direct flights to the major gateway of the Philippines, (2) Funding prioritization for the upgrading of domestic airports to provided night-landing and all-weather facilities for a more efficient operation and to emphasize safety improvements to meet International Civil Aviation Organization  Standards And Recommended Practices (ICAO SARPS), (3) Development of airports through Public-Private Partnership, and (4) Development of a coherent long-term investment plan for the airports.

CAAP assured of its continuous work to make more airports in the country night-rated. Equipping airports with night-rated capabilities will enable these facilities to serve more passengers. MJAA