IMF’s Strauss-Kahn sees sharp cuts in growth forecasts

from ITUC-CSI LONDON, Jan 21 (Reuters) – The International Monetary Fund will sharply cut growth forecasts this month and the world will not return to strong growth for two or three years, IMF Managing-Director Dominique Strauss-Kahn said on Wednesday. “Things are not improving,” Strauss-Kahn said in an interview with the BBC’s “Hard Talk” programme. The International Monetary Fund’s last forecast was “not that good” and a new forecast, to be released in a few days, will be “even worse”, he said. Asked about the fund’s forecasts for the world, U.S. and European economies, Strauss-Kahn said he did not know exactly how much these would be cut, but added: “I’m afraid that at least half a point or one percentage point down.” In its November forecast, the IMF projected world output would grow by 2.2 percent in 2009 while the United States would shrink by 0.7 percent and the euro area would shrink by 0.5 percent but the credit crunch has tightened its grip since then. Asked if the downwards revision meant the IMF expected a contraction in U.S. and European economies of between one and two percent this year, Strauss-Kahn said: “There is going to be this kind of contraction in the U.S., in Europe, including the UK.” Emerging countries, while still growing, would also do worse than expected, he said. “China, India, Brazil, other emerging countries are going to experience very slow growth. “Altogether, this first half of 2009 will be bad, the second half may show some improvement, but recovery can begin only at te beginning of 2010,” he said. “We are not going to go back to a high rate of growth before two or three years,” he added. Strauss-Kahn said the IMF may need more funds in six months to finance bailouts of countries that fall victim to the financial crisis. “The IMF has enough money today to deal with the countries coming today. If the crisis goes on, which is the most probable way, then down the road, in six months from now, we will need more money,” he said. “That’s why we need to organise now the way to have more money in six months, because it won’t be done overnight.”

Sa mga Kinauukulan (Department of Labor and Employment);

Magandang araw po. Nais po sana naming isangguni at humingi na rin ng tulong tungkol sa reklamo naming  mga empleyado sa _____, isang indiyanong kumpanya na may opisina sa _____, hinggil sa ilang aspeto ng pamamalakad na sa aming pang-unawa ay hindi alinsunod sa mga kasalukuyang batayan at mga alituntunin sa ating Labor Code.

Karamihan po sa amin ay mga IT Consultants at dahil na rin po sa aming propesyon at sa mga lokasyon ng aming mga kliyente at proyekto, kami po ay napipilitan o obligadong magtrabaho ng lampas sa walong oras maging araw man o gabi ng kadalasan ay wala man lang Night Differential Pay o Overnight Pay. Dahil na rin po sa pagsunod naming sa oras at kalendaryo ng  mga kliyente, madalas din kaming magtrabaho maging Holidays man po o Weekends ng walang karagdagang bayad o Holiday Premium.

Ang pagbabayad sa amin ng kumpanya hinggil sa Overtime Pay, Night Differential at Holiday Premium ay hindi regular at dahil na rin po sa kagustuhan ng kumpanya na mawala ito at makatipid sa gastusin ay kinakailangan ng bawat empleyado ng abiso at magpasa ng mga kaukulang forms na pirmado ng Vice President for Delivery na isang Indiyana upang mabayaran ng Payroll Department ang anumang karagdagang bayad. Magkagayunman, naging labis na napakahirap po ng pagkuha ang pirma ng nasabing kinauukulan kaya kadalasan nagdudulot ng di pagbayad ng kumpanya ng anumang nararapat sa isang empleyado.

Marami po dito ang halos magdamagan kung magtrabaho sa opisina at kadalasan pa ay on-call pag-uwi ng bahay ngunit hindi nababayaran ng tama. Dahil sa kagustuhan ng karamihan sa aming pagsilbihan ang mga kliyente ay wala na lang din sa aming naglalakas loob na umimik. May isang pagkakataon din po noong June 2008 ng hindi kami nakatanggap ng sahod sa isa sa aming mga kinsenas dahil raw po kailangang maglagay ng buffer ng kumpanya sa cashflow at idelay kami ng isang kinsenas. Marami sa amin ang nabigla dahil na rin sa kakatapos pa lang na enrollment ng mga mag-aaral at karamihan sa amin ay mga magulang na gipit din. Wala pong naging mga kasulatan o abiso na pormal dahil na rin iniiwasan ng mga nasa itaas ang anu mang dokumentong pwedeng gawing ebidensya kung may magreklamo man. Hanggang ngayon ay hindi pa rin ibinabalik ang kinsenas na kanilang hindi binayaran noong June 2008.

Wala rin pong Security of Tenure dito. Marami rin po sa aming mga katrabaho ang natanggal dahil na rin po sa redundancy na kanila na lamang pong pinapagawan ng resignation letter at binabayaran para pumayag kahit na sila ay pawang mga regular na empleyado na. Noong Disyembre 2007 at maging noong July 2008 ay ilang mga regular ang kanilang tinaggal due to retrenchment. Noong Disyembre 2008 ay kanila pong tinaggal din ang isang manager sa loob lamang ng isang araw dahil sa di pagkakaunawaan at loss of confidence. Siya po ay pinilit na magbigay ng resignation letter para mabayaran at maisakatuparan ang pagtanggal sa kanya ng walang kumplikasyon. Ito marahil ay ginawa upang maipakitang boluntaryo ang pag-alis ng nasabing empleyado. Ito po ay aming nakikita na isang anyo ng Constructive at Illegal Dismissal. Sa araw ding iyon ay pinatanggal ang kanyang mga gamit at pinaalis ng opisina ng biglaan. Ilan din po ngayong Enero 2009 ang nawalan din ng trabaho dahil sa kawalan ng seguridad.

Lahat din po ng nasa Upper Management ay mga dayuhang Indian at Amerikano. Karamihan sa kanila ay nagpupunta ng Pilipinas at nagtatrabaho ng Tourist Visa lang at pawing ang pakay na nakasulat sa mga Invitation Letter ay para makilahok sa pagpupulong ngunit layunin pala ay magtrabaho at manirahan. Dito na rin po sila kadalasan kumukuha ng kaukulang permit na gusto po rin naming ipabusisi upang maiayon sa kung ano man ang nakasaad sa batas at kung sila rin ba ay pinapatawan ng tamang buwis n gating bansa sa kanilang pagtatrabaho dito. Marami naman po sa ating kababayan ang may mataas na qualifications para sa mga naturang posisyon sa management ngunit wala pa ring pinoy ang kanilang tinatanggap. Bagkus ay mga dayuhan po ang kanilang kinukuha na pawing walang alam sa ating mga batas.

Halos ilan din po sa amin ang pinapadala sa ibang bansa upang magtrabaho mula tatlong buwan hanggang pito o walo ng hindi dumadaan sa POEA. Ang layunin na nakasaad sa aming mga papeles ay upang magsanay at makipagpulong bagkus ay trabaho ang aming ginagawa sa mga buwan na kami ay dumadayo sa ibang bansa. Ang ilan sa aming mga kasamahan ang ngayon ay halos mag-iisang taon na sa ibang bansa na hindi man lang naipapadaan sa POEA ang mga dokumento. Sa aming nakikita ay nagiging Recruitment Agency ang aming kumpanya dahil na rin sa Staff Augmentation Services na dala nito. Subalit wala naman kaming nalalamang kaukulang permit mula sa POEA at OWWA upang ang aming kumpanya ay mangalap at magpadala ng tao sa abroad upang magtrabaho. Nais po rin naming itong ipabusisi.

Isa pa rin po sa aming reklamo ang  kawalan ng bentilasyon rin sa gabi dahil na rin patay ang aircon ng building ay halos naging pasakit sa ilan sa aming nagtatrabaho sa gabi, sa mga weekends at tuwing may holidays. Mabuti na lamang at ilan sa amin ang nanguna sa paghingi ng electric fans man lang upang maisaayos ang kundisyon. Wala rin po kaming nurse o taong nakalaan para sa pangangalaga ng health and safety o maski man lang basic first aid na kinakailangan sa isang kumpanya na halos 150 katao ang laki.

Sa mga nabanggit po sa itaas, nais po sana naming humingi sa inyo ng pagkakataon na maiwasto kung ano man po ang mali sa pamamalakad ng kumpanya sa pamamagitan ng isang Site Visit o Inspection upang inyo na rin pong masaliksik at mapatotoo ang mga nabanggit na bagay-bagay, mabusisi ang aming Payroll patungkol sa mga hindi nababayarang Overtime Pay, Night Differential  at iba pang mga premiums at ang pagbusisi sa aming mga HR Policies pati na rin po ang iba pang mga bagay na maaring maiwasto upang maging kaaya-aya ang aming kundisyon sa kumpanya.

Layon po naming ang pagbabago at pagwawasto ng mga mali at hindi ang pagwasak ng reputasyon ng kumpanya. Nais rin po naming ibigay ng kumpanya kung ano man ang nararapat at wasto.  Sana po ay matulungan ninyo kami. Maraming Salamat po.

Ang inyong lingkod,

ANONYMOUS EMPLOYEE

Karapatan

by Honesto General
from Philippine Daily Inquirer

On Dec. 10, in observance of the 60th year of the of the Universal Declaration of Human Rights, the group Karapatan, at a news briefing in a Quezon City restaurant, presented a 32-page 2008 Human Rights Report, which was featured by the Philippine Daily Inquirer in a front-page story.

Human rights — i.e., freedom from unlawful arrest, imprisonment, torture or execution — are regarded as belonging fundamentally to all persons.

What is Karapatan? At the suggestion of Inquirer Research, I visited Karapatan’s website . I downloaded 12 pages of stuff. But after reading them — twice, mind you — Karapatan impressed me as a shadowy organization.

Karapatan claims to be an “Alliance for the Advancement of People’s Rights.” But the website did not include the name of even one member of the alliance. And yet, Karapatan claims to be “the biggest human rights network in the Philippines today.”

Only the name of the secretary general, Marie Hilao-Enriquez, appears on the website. What is this I hear, that at the top of Karapatan’s table of organization is the wife of a well-known communist?

Are Karapatan’s articles and bylaws registered with the Securities and Exchange Commission? When was the last elections held to select the governing body? Or, have the officials been elected for life?

In the insurance industry there are associations of insurers and reinsurers, broker and agents, adjusters and surveyors. But everything is transparent. Each association has its articles and bylaws available for scrutiny by the Insurance Commission. Meetings are held regularly. Annual elections are held, sometimes hotly contested.

Karapatan can be virulent. Listen to this: “The Arroyo government has not lived up to the promise of respecting the dignity and fulfilling the human rights of Filipinos, as we have not been any better over the last eight years … and the government has instead unleashed the brutality of the armed forces against the very people whose lives it has sworn to protect.” I have my complaints against the Gloria Macapagal-Arroyo administration and the Armed Forces, but this is too much.

Karapatan lashes out at everyone and everything in sight. This is the classic tactics of communists.

How much of the statistics Karapatan foists on us is verifiable? In a decades-long war against the communist New Peoples Army, the Moro Islamic Liberation Front and the Abu Sayyaf, there are bound to be human rights violations. But nothing compared to the slaughter of 250,000 communists in Indonesia during Suharto’s reign.

Karapatan seems to be well funded. Where does it get its money? Is it taxable, and, if so, are taxes being paid?

Is this one more proof that the Communist Party is the richest in the country?

With editing by INQUIRER.net

Winners, Lossers in Financial Crisis

by Cris Evert Lato
from Cebu Daily News

CEBU CITY, Philippines – About 30 percent of overseas Filipino workers (OFWs) are working in the United States, according to research group Ibon Foundation.

At least 52 percent of OFW remittances come from the US or are sent through US intermediary banks.

OFWs are expected to be affected by the global financial crisis affecting the US and other First World economies like Japan and Europe.

Some experts say the health and education sectors won’t be affected, sparing Filipino nurses and teachers in the US.

But University of San Carlos economics professor Fernando Fajardo thinks otherwise.

“Hospitals in the US which plan to expand or increase labor force may freeze business growth because banks are not willing to loan money because of the credit crunch,” said Fajardo, former assistant regional director of the National Economic and Development Authority in Central Visayas.

The situation may be used to exploit Filipino labor force abroad, warned Ibon Foundation executive director Jazminda Lumang.

“Cheaper OFW employment will lead to slower remittances to dependent families in the Philippines. This will lead to lower consumer spending and slower business,” said Lumang.

Robust real estate

Real estate, whose growth is fueled by OFW remittances, may also be affected, said Fajardo.

The Bangko Sentral ng Pilipinas reported that OFW remittances reached $12.2 billion from January to September 2008, a 17-percent increase compared to the same period last year.

This is one factor that boosts the confidence of most real estate companies in Cebu to continue their projects.

AboitizLand Inc. is expanding Kishanta Zen Residences in Talisay City, while construction is ongoing for a condominium building, Persimmon in Barangay (village) Mabolo, Cebu City.

Paramount Property Ventures Inc. (PPVI) recently launched its multi-million-peso development, Fonte de Versailles, in Minglanilla town, southern Cebu.

“Real estate is still a better investment because it’s on a solid ground. Our sales from international Filipino markets come from all over the world such as US, Middle East and Europe,” said Pia Mantecon, AboitizLand vice president for marketing, sales and customer service.

Filipinos working in other countries in Asia and Europe will continue to send money to their families, ensuring the sustained growth of the real estate industry.

“Thirty percent of the money sent by OFWs is invested in real estate. In general, we don’t see a material decline,” said PPVI business development consultant Boler Binamira.

A robust real estate sector is expected next year due to the rising demand for business processing outsourcing (BPO), tourism and OFWs, according to CB Richard Ellis (CBRE), an international commercial property and real estate services adviser.

“While it continues to expand its tourism infrastructure such as airport, hotels, resorts and retail facilities to accommodate the growing visitor arrival, the growing business community in Cebu mainly located in the Asiatown IT Park and Cebu Business Park has added new stimulus to the rapid growth and development of Metro Cebu,” said CBRE chairman Rick Santos.

Santos said opportunities for local and international developers are vast in the country, and Cebu specifically, due to lower operations cost.

“As companies’ revenues are under pressure, multinationals look to save costs. They move to the Philippines as it is easier to save a dollar than make dollar,” he said.

Labor is another main driver of BPO expansion as graduates from neighboring provinces such as Bohol, Negros Oriental and Leyte come to Cebu to find work.

Cebu will continue to be a leader in retail, hotel-resort and industrial segments.

But the demand for industrial space in Cebu will be slow because occupancy cost, including high power cost, limits the entry of most multinational companies, said CBRE general manager Trent Frankum.

But this low demand will be compensated by vibrant growth in the office, retail and hotel resort segments.

Frankum said a total of 115,623 square meters of new office space was scheduled for completion across Metro Cebu by the end of 2008.

“Anticipated slower growth in the call center segment will be compensated by high-value services such as back-office offshoring and outsourcing,” he added.

One indication that the real estate business is doing well is the stable transactions of land prices in Cebu and other parts of the country, said Frankum.

This means that there is still a robust medium to long-term growth for the real estate in the country despite worldwide fear of an economic slowdown.

Retail slowdown

CBRE expects a regional expansion of malls in Metro Cebu due to BPO and tourism growth.

On the other hand, Professor Fajardo said retail sales will slow down as people tighten their belts to brace themselves for the worse.

“There may be a lot of promos in malls but that goes to show that business is not good because if it’s doing well, they won’t hold bargain sales that often,” he said.

Although she admits a slowdown, Melanie Ng, president of Philippine Retailers Association Cebu Chapter, said retailers are still optimistic that people will buy during the holiday season.

“The buying power of Filipinos will still be there. Maybe it will not be that aggressive but Filipinos will still buy because it is part of our custom to buy something for Christmas,” she said.

For Jun Yap, president of Junrex Cellphones and Accessories Inc., sales of low-end mobile phone units have started to pick up again.

“If before we need to sell 1,000 cellphones to earn P1 million, today we need to sell 3,000 cellphones to get P1 million. We sell thrice as much to maintain growth,” Yap said.

Tourism still promoted

For Cebu’s tourism industry to grow, constant innovation from travel agencies and the Department of Tourism (DOT) is needed.

The decrease in the number of Korean, Japanese and US tourists is not yet alarming but players need to be creative and innovative to sustain the market, said Jennifer Franco, chairperson of National Association of Independent Travel Agencies Cebu Chapter (Naitas Cebu).

Franco said she noticed a change in the spending habits of foreign tourists like the Japanese.

“The Japanese market is now looking for middle-priced hotels, an indicator that they are careful with spending in line with the crisis,” she said.

Tourism Secretary Joseph “Ace” Durano, however, still projects industry growth nationwide from five to seven percent by the end of 2008.

Durano said marketing efforts are intensified in Asian countries which are nearer the Philippines. About P200 million out of the DOT’s P1.2 billion for 2009 will be spent on promotional campaigns to encourage inter-regional travel and strengthen the country’s position as a destination of choice.

Around P160 million will be spent for the country’s participation in the World Exposition in Shanghai, China in May 2010.

The remaining P40 million will be used to intensify market development efforts in the Asia Pacific region to promote medical and wellness tourism and shopping. It will also be used to develop English as a second language and vacation home investments.

Tourism arrivals went up from 3 million in 2007 to 3.4 million this year. The challenge is now how to increase hotel and resort rooms to accommodate more tourists.

According to CBRE, there were 4,585 DOT-accredited hotel rooms in Metro Cebu in 2007. The number went up to 7,384 in 2008. Another 1,930 rooms are expected to be added by 2009, noted CBRE.

Despite grim projections elsewhere, Efren Carreon, Neda-7 assistant regional director, said the global crisis does not have to mean a negative outcome in all sectors of the economy.

For some, it can even be advantageous.

Carreon cited stabilized food prices and a decrease in the cost of consumer goods as positive effects as oil price in the world market continue to fall.

BPO players in Cebu will benefit from the crisis as global companies undergo cost-cutting measures and be inclined to outsource operations, he said.

Bonifacio Belen, executive director of Cebu Educational Development Foundation for Information Technology (Cedf-IT), agreed.

He said there is no objective data which shows that the “protectionist mindset” of US President-elect Barack Obama will result in the decline of available BPO careers.

“The ultimate reason (for companies) to be convinced to locate in a certain city is reduced costs and that points to us,” said Belen.

(Part 3: Survival and saving tips for companies, families and students)

A puzzling economy

by Cielito Habito
from Philippine Daily Inquirer

MANILA, Philippines – Ever notice how our economy has been behaving strangely lately? The latest strange (but welcome) behavior is how job generation based on the last two quarterly Labor Force Surveys (July and October 2008) appeared healthy even in the face of the world economic slowdown that has taken a definite toll on our economy.

In July, it was reported that about 1.3 million new jobs were created in our economy within the preceding 12 months. That was very good, given our need to create at least a million new jobs a year to keep pace with growth in the working age population.

In stark contrast, the same figure a year ago was only 392,000 jobs, and yet this was the period that our economy was recorded to have grown at a 30-year high of 7.2 percent. The latest October jobs figure, while a bit lower at 861,000 new jobs year-on-year, was nonetheless again better than the previous year’s job generation (786,000).

And yet, economic growth had already slowed down significantly to the 4 percent level this year. We had, in short, less job creation last year when we had much faster (even record) production growth, and strangely enough, more job creation this year when economic growth has been much slower.

More puzzles
You’d think looking more closely at the data would help explain the puzzle. But the puzzle deepens even more when you check the breakdown of output growth and job generation across major sectors of the economy.

The services sector has significantly slowed down from its brisk growth in past years, with last year’s growth rate (7.2 percent) cut down to just about half this year (3.7 percent). And yet, services provided 44 percent more jobs this year (699,000) compared to last year (485,000).

The industry sector posted a healthy 7.1 percent growth in the third quarter, surpassing last year’s performance (6.6 percent). And yet it had created only a thousand new jobs in the 12 months preceding last October; the same figure last year was 182,000.

Agriculture is no less a puzzle. Last year, it posted an impressive growth of 5.6 percent in the third quarter, but lost 11,000 jobs. This year its growth has slowed down to less than half of last year’s pace (2.5 percent)–and yet generated 161,000 new jobs.

Job-killing growth?
These seeming contradictions puzzle me even more in light of the general impression one gets from experience–not only in the Philippines but elsewhere as well–that the “growth-employment elasticity” is usually lopsided downwards.

In plain English, a 1-percent fall in output (or slowdown in its growth) usually results in much more job losses than the jobs that are gained when the economy grows by 1 percent.

It was in this context that the term “jobless growth” came about. Economists had begun to notice that much of the economic growth in the world’s economies in at least the past decade has not been accompanied by a commensurate growth in jobs.

In many cases in fact, there were hardly any job increases at all even as economies continued growing–hence the term. Worse, there have been episodes when growth actually speeded up, and yet jobs actually fell, as in last year’s experience with our agricultural sector. This is not just jobless growth; it is better described as “job-killing growth!”

But what we’re seeing right now is the exact opposite. As growth slows down, we seem to see more jobs coming about than when the economy grew much faster. This is all welcome of course, but how do we explain such perverse trends?

Job profile
I am not about to question the statistics, even though many would immediately point to that as the possible answer. There are actually answers to be found in the further details of the job numbers. Where have the latest jobs been coming from?

I examined the available tables from the National Statistics Office (NSO) website, made some calculations, and found the following: Of the surprising 699,000 new services sector jobs mentioned above, more than half were in trade. And since I am not seeing an unusual proliferation of retail stores and shopping malls in the past 12 months, I surmise that what this means is that large numbers of Filipinos have taken to the usual informal sector selling/vending activities–”nangangalakal,” as squatters near our neighborhood describe the common occupation in their area.

And this includes selling items scavenged from the neighborhood garbage piles, which they systematically pore over and collect usable items from before the municipal garbage collection trucks come to collect them.

It would seem, then, that much of the puzzles I’ve been describing simply reflect the resilience of the average Filipino. When our poor compatriots find themselves against the wall, they will find a way. Clearly, the kind of growth we have been experiencing gives us little to be happy with or gloat about even if the posted GDP growth rate is faster than that of our neighbors. What continues to elude us is quality growth, one whose benefits permeate throughout the economy such that as the saying goes, “the rising tide lifts all boats.”

The best of the holiday season to all–and here’s wishing us all a joyous new year (”prosperous” may not be quite realistic)!

Comments are welcome at chabito@ateneo.edu