B 2


BY DARWIN G. AMOJELAR SENIOR REPORTER


business The Manila Times MONDAY D e cember 13, 2010 market.


PAL warns of overcapacity on Air Asia entry P


HILIPPINE Airlines (PAL) warned that the entry of Air Asia would create overcapacity in the local


Jaime Bautista, PAL president and chief operating officer, said he is concerned about the “overcapac- ity” in the market that would lead to a “price war.” ”It [price war] may lead to huge losses for everybody,” he said. He however insists that PAL is open to competition. PAL has no operation in Clark, but the flag-carrier may look to the


alternative airport in the future, Bautista said. PAL held a 43 percent share in the domestic market in the fiscal year end- ing March this year and 30.8 percent for Asia and Australia. Work stoppages however loom at Asia’s oldest airline, as the majority of the airline’s workforce voted to hold a strike. To protect its market share, “We have to offer competitive fares,” par-


Agus-Pulangi plant rehab set to avert power crisis


THE government plans to rehabili- tate the Agus-Pulangi hydroelectric power complex in Mindanao to help secure the region’s electricity supply. Department of Energy (DOE) Sec- retary Jose Rene Almendras said he asked state-owned National Power Corp. (Napocor) to bring back the hydro facility to its 700-megawatt generating capacity to avert a supply deficiency in Southern Philippines. ”We need to rehabilitate and fix up


what we can in Agus-Pulangi,” he said. Mindanao is projected to suffer a repeat of early this year’s blackouts once the dry season hits in 2011. The region relies on the Agus- Pulangi facility for nearly half of its power supply during normal weather conditions, and as such is severely affected when water levels in reservoirs dry up. Froilan Tampinco, Napocor presi- dent, said they would need P2 bil- lion, which would have to be shoul- dered by government, to bring back 100 to 200 megawatts to the hydro plants’ output. ”But if we would like to add or


uprate some of the facilities, for in- stance the Pulangi, which will in- clude the cost for dredging, then we are looking at spending about P3 billion,” Tampinco said. Almendras said the government is banking on the rehabilitation of existing power generating plants in Mindanao to prevent another round of outages next year unless private companies put up new capacity. The government also has no choice but to continue to spend on repair and maintenance at the Agus- Pulangi facility after lawmakers put its privatization on hold. Under the Electric Power Indus-


try Reform Act of 2001, the hydro complex should be privatized 10 years after the law was passed. But the size and affordable power rates offered by the hydro plants, which provide the cheapest source of electricity in Mindanao, have caused worries that electricity bills in the country’s most impoverished region may skyrocket it they were turned over to the private sector. EUAN PAULO C. AÑONUEVO


ticularly AirphilExpress, Bautista said, referring to PAL’s budget unit. In October, AirPhilExpress began flights to Singapore using Airbus A320 aircraft.


AirphilExpress will spend $250 mil- lion to acquire 18-brand new A320s for a period of two and a half years. At present, AirphilExpress has three A320s and is expecting three more units by yearend. For next year and 2012, AirphilExpress expects another 12 A320s for delivery. The low-cost carrier (LCC) plans to fly to Iloilo, Davao, Puerto Princesa, Baguio, Marinduque, Zamboanga, Legazpi, Tagbilaran for domestic routes, and to South Korea and Bang-


kok for international flights. Last week, Air Asia announced that it partnered with Antonio Cojuangco, a former chairman of Philippine Long Distance Tel- ephone Co. (PLDT) and cousin of President Benigno Aquino 3rd, to form a budget airline that will op- erate in Clark, Pampanga. Air Asia flies to Kuala Lumpur and Kota Kinabalu from Clark. Porvenir Porciuncula, deputy ex-


ecutive director of the Civil Aero- nautics Board (CAB), said Tony Fernandes, Air Asia’s chief executive, and Cojuangco recently met with officials of the Department of Trans- portation and Communications (DOTC) to present their planned


airline operation in Clark. Porciuncula said that Air Asia


would take a 40 percent stake, while Cojuangco would assume the re- maining 60 percent.


The CAB official said Air Asia plans to start domestic and regional operations from Clark next year. ”They are planning to fly from Clark, but they can go to other do mestic destinations other than Clark. It will give a better access in the mar- ket of Air Asia,” Porciuncula said. Air Asia had launched similar budget subsidiaries in Thailand, In- donesia, with a joint venture in Vi- etnam also in the works.


Air Asia operates within home-base Malaysia, as well as in China, South-


STATE-OWNED National Dairy Au- thority (NDA) is seeking addi- tional budget to implement the Dairy Roadmap 2010-2016, which aims to boost milk production and reduce the country’s dependence on imports. Grace Cenas, NDA administrator, said the agency will need a total of P14.4 billion, or P2.4 billion a year over the next six years, for the imple- mentation of the Dairy Roadmap. Cenas said the amount will be used


for various programs including mar- ket development, herd infusion and


upgrading, dairy enterprise support, and for the national government’s public school milk feeding program. “Dairy is one of the highly [im- ported] commodities in the country, next only to rice. If we want to achieve self-sufficiency, we should also ad- dress our need for milk and other dairy products,” the official said. Under the roadmap, NDA aims to double milk sufficiency from 19 per- cent to 43 percent, as well as local milk contribution from 26 percent to 46 percent of the total supply. The plan also calls for tripling an-


nual local milk production from 15 million to 45 million liters, or from 43 tons to 131 tons.


Through the establishment of dairy zones across the Philippines, the NDA also aims to produce 22,270 full-time jobs, increase the national income to about P1.57 billion in 2016 from P50 billion in 2010, build up dairy asset (animals) to about P4.14 billion, and generate P1.06 billion in foreign exchange savings. Cenas said the NDA already iden- tified at least 46 dairy zones in the country – 11 in Northern Luzon, 12


east Asia and the Asian subcontinent. Data from Centre for Asia Pa-


cific Aviation showed that Air Asia’s fleet stood at 152 A320s as of March this year.


Of this total, 48 are in service and 104 are on order.


Besides Air Asia, Tiger Airways Holdings Ltd. will also operate in the Philippines under a marketing arrangement with local carrier Southeast Asian Airlines (Seair). The budget unit of Singapore Air-


lines, Tiger will also lease two A320s to Seair that will be used to expand its regional operation.


Other budget carriers that oper- ate from Clark are Cebu Pacific and Asian Airlines.


NDA wants additional budget to implement roadmap


in Southern Luzon, 11 in the Visayas, and 12 in Mindanao. “To be an accredited dairy zone, the area within a 30-kilometer radius should have at least 100 farmers and 300 dairy animals,” she said. The NDA chief also said that they


have embarked on a public-private part- nership with three dairy farms in Luzon to promote multiplier farm operations. These farms are the Batangas Dairy Multi-Purpose Cooperative and Sta. Cruz Baptist Church Farm in Batangas, and the Hapicow Farm in Quezon. JAMES KONSTANTIN GALVEZ


DENR pursues climate-change resilient model areas


THE Department of Environment and Natural Resources (DENR) launched a four-pronged project aimed at devel- oping models of climate change-resil- ient communities in agricultural and forested areas using updated scientific data on climate risk management. In a statement, DENR Secretary


Ramon Paje said the $4.97-million project funded by the Global Environ- ment Fund (GEF) of the World Bank recognizes the need to strengthen biodiversity conservation and forest protection efforts as key to bringing down poverty in rural communities.


Paje said the implementation of the Philippines Climate Change Adapta- tion Project Phase 1 (PhilCCAP1) seeks to develop on-the-ground adaptation measures drawn from practical exam- ples and approaches that demonstrate the benefits of mainstreaming climate risk management into key national development strategies.


“The project supports the govern-


ment’s efforts to protect the lowland and upland communities from the cumu- lative effects of climate change as it builds up their resiliency with climate- change resilient crop production system


and enhanced protection of forests and biodiversity conservation,” Paje said. Eight municipalities in Regions 2, 6, and 13 have been chosen as pilot sites for the project, including the towns of Penablanca and Tuguegarao City in Cagayan province; Janiuay, Pototan, and Dumangas in Iloilo; and General Luna, Del Carmen and Dapa in Surigao del Norte.


PhilCCAP1 will operate on a plat- form that will develop and demon- strate climate change adaptation strategies in the agriculture and natu- ral resources management, using five


core elements, namely climate proof- ing irrigation infrastructure; enhanc- ing delivery and effectiveness of ex- tension services for farm-level climate risk management; pilot-testing the feasibility of weather index-based crop insurance; strengthening cli- mate change resilience through im- proved management of protected areas; and improving access to more reliable scientific informa- tion that would enable more rapid and accurate decision making for climate risk management. JAMES KONSTANTIN GALVEZ


Page 1  |  Page 2  |  Page 3  |  Page 4  |  Page 5  |  Page 6  |  Page 7  |  Page 8  |  Page 9  |  Page 10  |  Page 11  |  Page 12  |  Page 13  |  Page 14