Wednesday, November 30, 2022

BWorld 570, On government debt, WESM prices, and the UP presidency

* My column in BusinessWorld last Nov. 21.

Today and tomorrow I am attending the Pilipinas Conference 2022, organized by Stratbase ADR Institute, held at the Ayala Museum in Makati City. I thank Stratbase president, friend, and fellow BusinessWorld columnist Dindo Manhit, for the invitation. Among the Keynote Speakers of the two-day conference are Department of Budget and Management (DBM) Secretary Amenah Pangandaman on Nov. 21, and Finance Secretary Benjamin Diokno on Nov. 22.

This morning, Secretary Pangandaman spoke about “Open Government and Digitization Efforts of the DBM.” Among the things she said are: building a CSO (certified security officer) desk in the DBM to directly link the public to the agency, a P12.47-billion budget for ICT (information and communications technology) and digitalization programs and projects in 2023 for the digital transformation of the government’s procurement process, and diminish human discretion in government transactions.

These are good initiatives by Secretary Pangandaman to help reduce waste and inefficiencies in government transactions and procurement. When waste is minimized, the need for taxes to sustain wasteful spending is also minimized. People should use their additional income and savings for corporate expansion and household needs, for more job creation, not for funding more waste in government.

Tomorrow, Secretary Diokno will talk about “Strengthening Public-Private Partnerships (PPPs) to Rebuild the Philippine Economy” — a timely topic because the Philippine government’s debt keeps rising and we need more hard infrastructure to hasten mobility of people and commodities, goods and services, without compromising more tax resources.


In 2019, the government had a budget deficit of P660 billion. This ballooned to P1.67 trillion in 2021, and may likely reach P1.4 trillion by end-2022. Interest payment alone was P429 billion in 2021 and this is likely to reach P530 billion this year.

The outstanding public debt (actual plus guaranteed) has increased from P8.22 trillion in 2019 to P12.15 trillion in 2021 and this is likely to reach P14.5 trillion by end-2022. Our (actual) public debt already slowed to 37% of GDP in 2019, jumped to 57% in 2021, and is projected to reach 59% of GDP this year (see Table 1).

Stagflation (stagnant growth plus high inflation) is already building up in many rich countries this year and a global recession is likely to happen next year. We should have wide leeway in both public and private resources to sustain important services without resorting to more borrowings and imposing new taxes on companies and people who are just recovering their revenues and income this year to 2019 level.


Last week, the Independent Electricity Market Operator of the Philippines (IEMOP) reported a piece of good news — high power margin (supply less demand) of 3,500+ megawatts (MW) and lower prices at the Wholesale Electricity Spot Market (WESM) for the November 2022 billing period. I summarize in Table 2 the prices from January to November billing, and added the percent contribution of coal and intermittent sources. Coal is frequently demonized but is largely responsible for why those who want it phased out still have electricity 24/7. The beloved wind-solar have combined generation of near-insignificant levels.

Recently, there have been attacks against Energy Secretary Raphael Lotilla and Energy Regulatory Commission (ERC) Chair Monalisa Dimalanta which say that they are not objective and neutral because they have worked with one of the major gencos in the country. While this might be a factor, Lotilla and Dimalanta are respected lawyers and products of UP Law who have minds of their own as government officials. Besides, policy debates like whether or not to press the National Grid Corp. of the Philippines (NGCP) to honor its contract to secure the required and exclusive ancillary services for grid stability, its being the only private monopoly nationwide and which did not do a public listing, should be discussed as societal issues, not personality issues.

The more that detractors personally attack Secretary Lotilla and Chair Dimalanta, the more they expose themselves as incapable of focusing on issues and just pursuing narrow corporate interests, not the consumer’s interest of having a stable grid free from frequent threats of power fluctuation if not blackouts.


The University of the Philippines (UP) will soon have a new president. There are six nominees or candidates, all accomplished and respected individuals who have the capacity to lead the premier educational system of the country with eight constituent universities and campuses nationwide.

For me, a UP President is someone with specific, unique characteristics like the following:

One, he knows UP in and out. Two, he has an excellent academic record and achievements. And three, he has national and international stature to help mobilize resources for the university and not just rely solely on taxpayers’ money.

The candidate who best fills this big pair of shoes, I think, is the current Chancellor of UP Diliman, Dr. Fidel Nemenzo. He studied in UP from nursery and elementary to high school to college, has lived in the campus all throughout his life except when he went abroad for his graduate studies and lectures.

Dr. Nemenzo is a hard-core mathematician and academic. He finished BS Math at UP, MS and PhD Math at Sophia University in Japan, has done Math research and held teaching posts in universities in Singapore, Phnom Penh, Tokyo, Amsterdam, and Munich. His favorite research areas are number theory, elliptic curves, and coding theory. He was the past president of the Mathematical Society of the Philippines, chair of the Division of Mathematical Sciences, National Research Council of the Phils. (NRCP), and past president of the Southeast Asian Mathematical Society.

As Chancellor of UP Diliman, the biggest of the eight campuses, Dr. Nemenzo has initiated or pushed for the creation of programs in areas crucial for science and technology innovation and industrialization such as: a PhD in Data Science, a PhD in Artificial Intelligence (AI), a Master of Engineering in AI, the UP Data Commons (high performance computational facility for R&D), and the UP Center for Intelligent Systems.

With such an excellent academic record, and national and international exposure as a deep-blue academic and researcher, if he becomes the University President he should further project UP as an academic center for hard core natural and applied sciences.

While corporations are strong in applied sciences and product marketing, they lack expertise in natural sciences and basic research. Partnership with universities that are strong in the science, technology, engineering, and math (STEM) like UP is a must for them to have technological innovation and mastery. And such technological and funding partnerships would help UP rely less on government resources — which, Table 1 above shows, have been deteriorating.

Dr. Nemenzo would to be the most appropriate candidate for UP President. Not only for UP, but for the country as a whole.

See also:
BWorld 567, Growth, commodities inflation, and births deflation, November 08, 2022
BWorld 568, Inflation and illicit trade, November 9, 2022
BWorld 569, Growth, power transmission, and Poland, November 25, 2022.

Deindustrialization 8, Germany, Oct-Nov reports

Germany, the world's 4th largest economy.
Electricity prices from January 2021 to Nov. 2022, below. From about Euro 75/MWH in June 2021 to nearly Euro 400/MWH currently.

Selected reports:

1. German Industry Collapse: Companies Leaving In Droves…”Can No Longer Bear Cost Explosion”!
By P Gosselin on 25. September 2022

2. Energy Institute: supply gaps in the electricity market possible by 2030
By Die kalte Sonne  (Translated by P. Gosselin)
1 October 2022

3. Berlin Antifa Group “Goes On Hunt” For High Energy Users… Heated Pools “Immediately Collectivized”
P Gosselin on 2. October 2022

4. Germany Finally Says the F-Word: ‘Fracking’
A country used to buying gas elsewhere suddenly remembers there’s a lot in the ground at home.
Joseph C. Sternberg  Oct. 6, 2022

5. German companies look at offshore production as energy prices rocket
Riham Alkousaa, John O'Donnell and Patricia Weiss. Mon, 10 October 2022

6. German Government Fears Millions Of Furnaces Going Off…Children Now Being Handed Blankets At School
P Gosselin on 11. October 2022

7. Wood Theft Skyrocketing As Germans Try To Keep Warm. Firewood Tracked By GPS
P Gosselin on 19. October 2022

8. Energy crisis: Quarter of German companies ‘plan to cut jobs’
In order to tackle rising energy prices, a quarter of German companies revealed in a new survey that they planned to cut jobs, among other cost saving measures.
Published: 24 October 2022

9. Germany Is Dismantling A Wind Farm To Make Way For A Coal Mine
By Michael Kern - Oct 26, 2022

10. Polish Leader Calls German Energy Policy “A Curse, Fiasco”…2/3 Of Restaurants Face Bankruptcy!
P Gosselin on 28. October 2022

11. Mittel-kaput? German industry stares into the abyss
Facing a prolonged energy crisis, many German firms face the unpleasant option of either shutting down or relocating elsewhere.

12. Exclusive: Germany steps up emergency cash plans to cope in blackout
By Tom Sims, Marta Orosz and John O'Donnell, Nov. 15, 2022

13. Germany’s Compounding Energy Woes: Even Wind Power Industry Is “Sliding Into Crisis”
P Gosselin on 15. November 2022

14. German meat industry warns of empty supermarket shelves
Nov. 16,  2022

15. Germany Preparing For Emergency Cash Deliveries, Bank Runs And "Aggressive Discontent" Ahead Of Winter Power Cuts

16. Energy Crisis: German Minister President Suggests Heating One Room In Winter Is Enough
P Gosselin on 20. November 2022

17. 75% Of German Wind Turbines Kill 70 Bats Each In 2 Months. There Are 30,000 Wind Turbines In Germany
By Kenneth Richard on 21. November 2022

18. Germany Sets Windfall Tax at 90% for Clean Power Generators
Arne Delfs and Kamil Kowalcze November 24, 2022

19. VW Warns Soaring EU Energy Costs Render Battery Plants Unviable
Monica Raymunt November 28, 2022

20. Destruction By Energy Costs: Fivefold Higher Prices Cause Popular Hotel, Brewery To Close
P Gosselin on 29. November 2022

21. Germany’s Largest State Declares Emergency Amid Energy Crisis
Tsvetana Paraskova - Nov 30, 2022

See also:
Deindustrialization 5, Germany, August-Sept. 2022 reports, October 03, 2022
Deindustrialization 6, UK, Sept. 2022 reports, October 20, 2022
Deindustrialization 7, Other Europe, Sept-Oct News, November 08, 2022.

Friday, November 25, 2022

BWorld 569, Growth, power transmission, and Poland

* My article in BusinessWorld last November 14.

There are three topics this week and we go straight to them.


The Philippine Statistics Authority (PSA) reported some good news last Thursday — the country’s GDP growth in the third quarter (Q3) was 7.6%.

Of the 16 private economists polled by BusinessWorld (“Q3 GDP growth likely slowed — poll,” Nov. 7), only two — Ser Peña-Reyes of Ateneo and Jonas Ravelas of eManagement — made near projections of 7.7% and 7%, respectively.

Until early October, all the multilaterals — the Asian Development Bank, the World Bank, and the International Monetary Fund (ADB, WB, IMF) — projected growth of 6.5% in 2022. Since they knew that Q1 and Q2 average growth was already at 7.8%, they implied that the average growth in Q3 and Q4 would only be 5.2%. Far out. They may have good econometric models but archaic and unrealistic assumptions in plugging numbers to their models.

This column projected that the Philippines’ GDP growth would be 7-7.5% for Q3 2022. I wrote the following statements in BusinessWorld:

1. “The DBCC growth target of 6.5%-7.5% in 2022 is attainable — and we will likely surpass it. The growth target from 2023-2028 of 6.5%-8% is also attainable.” (“Growth recovery, declining births, and rising power demand,” Aug. 15).

2. “I see growth of 7-7.5% in Q3 and this will likely be sustained in Q4. So, the full year 2022 growth would be around 7.5%, not the 6.5% projection of the multilaterals.” (“Today’s topics: Economic briefing in Washington DC, PPP Center, Tariff Commission, and agencies with no secretaries,” Oct. 17).

3. “I retain my growth projection for the Philippines of 7-7.5% in Q3, Q4, and full year 2022.” (“This week: Growth, commodities inflation, and birth deflation,” Oct. 31).

In 2020, the Philippines had the worst economic contraction in Asia. This year, it looks like the Philippines will have the fourth fastest growth in Asia after Malaysia, Vietnam and India (see Table 1).

What explains the fast growth in Q3? I see three immediate reasons.

One, the lifting of the lockdown by President Ferdinand Marcos, Jr., the assurance in his first state of the nation address last July that he would not impose any more lockdowns.

Two, the very early formation of the competent economic team. Then the early announcement by Finance Secretary Benjamin Diokno that there would be no tax hikes in major sectors despite the huge public debt that ballooned over the last two years. Budget Secretary Amenah Pangandaman also announced measures to have fiscal discipline via bureaucracy rightsizing. National Economic and Development Authority Secretary Arsenio Balisacan announced the medium-term plan and more government intervention that was not included there.

Three, the series of Philippine Economic Briefing (PEB) investment roadshows by the president and the economic team in September alone — in Jakarta and Singapore on Sept. 6 and 7, and New York City on Sept. 22. This sent a clear, explicit signal to domestic and foreign investors that market-oriented reforms are already in place for them.

My projection for Q4 GDP growth is 7.5-8%. I will explain the basis for this in the next few weeks.


I want to comment on these four recent reports in BusinessWorld.

1. “ERC determining extent of subsidies for marginalized power consumers” (Nov. 7)

2. “NGCP fined P5.1 million over failure to maintain adequate reserve power” (Nov. 8)

3. “Grid operator to appeal P5.1-million ERC fine” (Nov. 10)

4. “Meralco raises electricity rates for November” (Nov. 10)

Report number one is about Republic Act (RA) 11552 extending the lifeline rate, or subsidies for low usage consumers, from 20 to 50 years. There are two problems with endless subsidies like this law. One, not all low-usage consumers are poor — they may be rich people who have vacation houses somewhere and just occasionally use these and hence, consumption is low. And, two, other consumers will be forced to pay for that subsidy and this will distort household savings and spending.

Reports number two and three show that the National Grid Corp. of the Philippines (NGCP) — the only remaining private monopoly nationwide — is indeed part of the reason why there are still regular yellow and red low power alerts happening this year. Power supply and reserves are often thin and can lead to rotating blackouts, which can lead to damaged appliances and machines, the frequent use of gensets by companies and candles by the poor, and few investors coming in. While ageing power plants and a sudden spike in power demand can be blamed, the NGCP has its share of blame because of its continued failure to procure adequate levels of reserve power exclusively contracted to them to ensure grid security and stability.

The monopoly has a dual role and responsibility, as a network and a system operator and has been lacking in both roles. If it does not want to secure firm contracts for ancillary services and grid reliability, then it can leave its role as the system operator and give it to Transco.

I saw the NGCP press release that was published in, and find it weird and deceptive. It talked about politics and “political maneuvers” when the real issues are grid stability, and how we can avoid having regular yellow-red alerts even during the rainy months.

The Energy Regulatory Commission (ERC) is correct. The NGCP, the monopolist, should shape up, pay the fines, obey the regulator or risk losing the franchise that granted it a monopoly nationwide in power transmission function.

The Philippines has low GDP partly because of its low power generation capacity. In 2021, the country produced a total (on-grid plus off-grid power) of only 108.3 terawatt-hours (TWH), of which the combined contribution of solar plus wind was only about 2.7 TWH or just 2.5% of total. Vietnam’s power generation is more than twice our’s, Malaysia and Thailand’s are about two-thirds larger, than the Philippines (see Table 2).

Many companies might want to expand operations but they see that they will face blackouts due to the low power supply and margins, so they postpone expansion. And this puts a brake on more economic growth.

Countries with high expansion in power generation over the last two decades (at least 130%, see Table 2) are also the same countries that had GDP growth of 5% or higher prior to the lockdowns of 2020-2021 (see Table 1) — China, India, Indonesia, Vietnam, Malaysia, and the Philippines. They are also poised to have at least 5% growth this year. Nonetheless, the Philippines must expand its power generation significantly from the current average of about 5-6 TWH/year to 8-9 TWH/year in 2023-2028. Vietnam’s generation increases by about 18 TWH/year.

Report number four is about the rise in power generation charge by plants with power supply agreements (PSAs), and not due to distribution charge or spot market generation cost and other factors. Meralco remains a responsible distribution utility that keeps its overall, all-in price of below P10/kwh while many electric cooperatives nationwide have rates that are twice its level, which penalize many consumers in the provinces.


Upon the invitation of the Embassy of Poland to the Philippines, I attended the celebration of their national day on Nov. 11 at the Blue Leaf Pavillion, McKinley Hill, Taguig City. It was the second event by the embassy that I attended. The first was when Marcin Przydacz, Undersecretary of State in the Polish Ministry of Foreign Affairs, came to Manila for a press conference on July 13 on the subject of Poland-Asia economic cooperation and the war in Ukraine.

Before the program started, I briefly spoke with Poland’s Ambassador, Jaroslaw Szczepankiewicz, and thanked him personally for the invitation. Among the guests from the diplomatic community in Manila that I met that night were the Thai Ambassador Vasin Ruangprateepsaeng, the Indonesian Ambassador Agus Widjojo, and Czech Republic First Secretary and Consul Jan Krivos.

Poland is the 23rd largest economy in the world (its 2021 GDP size was $679 billion) and 10th largest in Europe. I included Poland in both tables in this column to further situate its economic and energy capacity. The Philippines’ main trade partners in Europe are the Netherlands, Germany, the United Kingdom, and France. There should be good business potentials between the Philippines and Poland when there is closer trade and investment promotion activities done in both countries.

See also:
BWorld 566, Appreciating life, family, and friends, November 01, 2022 
BWorld 567, Growth, commodities inflation, and births deflation, November 08, 2022
BWorld 568, Inflation and illicit trade, November 9, 2022.

Inequality 41, WB's report on poverty and inequality in the PH

The WB discussed their recent report, "Overcoming poverty and inequality in the Philippines."

My quick reaction -- Overcome poverty, Yes. We should have less poor people, more rich people.
And No, we should not overcome inequality. We should respect more inequality.

The WB, UN, and all other multilaterals are stoking envy. The PH with about 113 M people, if there are 50 owners of Ferrari, the politics of inequality say these 50 families should be demonized. No. We should have 200, 500 families who shd own Ferrari. We shd have more wealthy people, not less.

Once you successfully stoke envy in the hearts and minds of many people, it is very easy to impose more taxes, high taxes. Being wealthy is evil so they should be over-taxed. We should encourage our people to be rich. Have big houses, more cars.

See this from the Table of Contents.

The huge public debt, huge borrowings -- from the WB, ADB, private banks, bond and security holders -- are not a problem for the WB. In 2021, the PH government paid P429 B interest payment alone, principal not included yet. This 2022 Sept, we already paid P400 B interest alone. Could reach P530 B by end-December.

And from its recommended policies:

"Promote uptake of booster vaccination...
"Support schools in assessing student learning....
"Strengthen social protection programs and provide well-targeted assistance...
"Develop a fiscally viable unemployment insurance program..."

There. More spend spend spend. 

I checked if WB bothered to say something like "Shrink or abolish old welfare programs as new ones are introduced" -- nada. zero. All new subsidies and spending are on top of existing ones.

Then another recommendation by the WB:

"Investment should also make softening the impacts of climate change a priority. To ensure that agriculture is sustainable and resilient..." 

CC literture is about decarbonization, fight or phase out fossil fuels. But modern agriculture, high productivity agriculture always involves the use of machines, huge tractors, harvesters, trucks, irrigation pumps. All of them use fossil fuels.

So-called "Sustainable, low environmental impact" farming is done via carabao and cows tilling. One hectare will take about 2 weeks of 7-days/week continued plowing by a carabao, the farmer's feet are dilapidated by sharp grasses, the wound can lead to infection.

"Non-sustainable, fossil fuel guzzling" farming via modern tractors, one hectare will take only 2 hours. Plow in the morning, start planting in the afternoon. Farmers feet safe from wound and infection, thanks to machines and fossil fuels.

But WB, UN, etc will be unhappy when you thank fossil fuels. While they jetset from Washington DC and NYC to anywhere around the world. On fossil fuels.

If you "overcome poverty", doesn't this imply "less inequality"?

No. If your main concern is overcome poverty, allow more inequality. Consider this example.

1. Average income of top 1% of households (HHs) is P1M/month, ave income of the poorest 10% of HHs is P5k/month. The former has 200x more income than the latter.

2. As economy expands, the ave income of top 1% is P50M/month, ave income of poorest 10% is P25k. The former now has 2,000x more income than the latter. Inequality has worsened. Is this bad?

No. In (1), the poorest can only ride bicycles and carabaos.  In (2), the poorest now ride motorcycles or e-bikes, even a 3rd-hand car.

The goal is to overcome poverty. If more inequality will produce this, so be it.

SG is doing good. They created enclaves for the super super rich, billionaires from Europe and US are attracted there. Give them lots of electricity, SG is running about 99% on fossil fuels, mainly natgas. When billionaires go to your country, they build huuuuge houses, have many cars. This creates huuuuge jobs, from construction workers to plumbers, electricians, mechanics, etc.

See also:
Inequality 38, Forbes' billionaires 2019, March 06, 2019 
Inequality 39, Capitalism and its detractors, October 03, 2019
Inequality 40, Real minimum wage is zero, May 15, 2021.

Wednesday, November 09, 2022

BWorld 568, Inflation and illicit trade

* My column BusinessWorld last Monday Nov. 7.

Last week, the big national news was the leap in the country’s inflation rate to 7.7% in October from 6.9% in September, according to the Philippine Statistics Authority (PSA). Meanwhile, the big international news was the high October inflation in Europe, with Germany hitting 10.4%, Italy with 11.9%, and so on. The Philippines now is one of four Asian economies with 14-year high inflation rates, the other three being Singapore, Thailand, and Taiwan (see Table 1).

Practically all of these countries’ central banks have raised their interest rates to fight high inflation, and inflation is not tamed yet, suggesting the policy is not working or working only mildly.

High inflation means that demand is higher than the supply of goods and services. It also means that the money supply is high relative to commodities supply — there is more money chasing fewer commodities.

To really fight inflation, non-monetary policy measures must be done. One, more people should be working and the endless no-timetable welfare and subsidies should shrink. Two, the various government bureaucracies, national and local, should also shrink because expenditures for their salaries, bonuses, offices, etc. are so high relative to revenues, leading to huge borrowings, huge interest payment that will require huge taxes, fines, and penalties today and tomorrow to offset. And, three, huge leakages in revenues should be plugged, which includes a vigorous fight against smuggling and/or reducing tax rates to realistic levels that make smuggling less attractive.

Last Saturday, Nov. 4, I attended the Anti-Illicit Trade Awareness Conference with the theme, “Plugging Revenue Leakage by Curbing Illicit Tobacco Trade,” held at the Marriott Clark, Pampanga, and jointly sponsored by VMJ Law and Japan Tobacco International (JTI).

The speakers were Department of Finance (DoF) Assistant Secretary Dakila Elteen Napao; John Freda, General Manager of JTI Philippines; Julian Cheung of JTI Asia Pacific Ltd.; Maria Rhona Vergara and Marie Hope Jamero, both of VMJ Law; Christine Pangilinan-Canlapan of the Intellectual Property Office Philippines (IPOPHIL); and former Congressman Jericho Jonas “Koko” Nograles.

There were many participants from the Bureau of Customs (BoC), the Bureau of Internal Revenue (BIR), the Crime Investigation and Detection Group (CIDG) of the police, the Philippine Coast Guard (PCG), the National Bureau of Investigation (NBI), and staff from the Senate and House of Representatives.

How big or how serious is smuggling and the illicit trade of tobacco alone (not including the smuggling of alcohol, petroleum, electronics and gadgets, etc.) in the Philippines? I reviewed some literature and reports, including my own estimate, and the figures range from P15 billion in unpaid taxes in 2013, to a high of P60 billion a year (see Table 2).

If we take the median of P30 billion/year in unpaid tobacco taxes as estimated by Congressman Joey Salceda, and assuming that vigorous implementation of anti-smuggling operations by various lead enforcement agencies (LEAs) and local governments, the DoF can realize at least P15 billion in additional revenues yearly. That P15 billion can fund the full year budget of the BIR and BoC, or the PCG, or the NBI and CIDG (see Table 3).

A Coast Guard officer from Sulu made a good observation that there has been free trade between Sulu-Tawi Tawi and Sabah, and other islands of Malaysia and Indonesia. Getting just the annual business permits of National Government agencies in Zamboanga makes it very costly to do legal business. Which implies that free trade — which is pro-consumer — is more dynamic when there are fewer permits, and less taxes and tariffs.

In many areas and cities of coastal Mindanao, illicit tobacco is sold for as low as P35/pack while the cheapest legal tobacco is P95/pack because the excise tax alone is already P55/pack in 2022, and will rise to P60/pack in 2023, then increase by 5% yearly from 2024 onwards. As the tax increases, the price gap between the legal and illegal products also increases and more people will shift to the illicit products and government will earn less after some time. This is the essence of the “Laffer Curve” in economics: as tax rates increase, revenues initially increase then reach a curve plateau, and as tax rates further increase, revenues begin to fall. People either reduce their consumption of the taxed products, or they shift to the alternative un-taxed, smuggled products.

One revenue measure that should be considered by Congress to avoid this situation of the Laffer Curve, is to stop the high if not progressive increase in taxes for “sin” products: alcohol, tobacco and sugar. Having a big nanny state is not good for people. A consistent nanny state should also regulate and tax many other “dangerous” activities like downhill cycling, rock climbing, sky jumping, deep sea diving, speed racing, etc. Just one big mistake in these activities can mean severe injuries if not deaths. The government should focus on expanding information awareness to people then let them live their own lives.

Meanwhile, there will be another BusinessWorld Economic Forum, with the theme “Forecast 2023: Opportunity in Uncertainty,” on Nov. 29 at the Grand Hyatt Hotel BGC. Among the Keynote Speakers will be House Speaker Martin Romualdez, DoF Secretary Benjamin Diokno, and IMF Director for Asia Pacific Krishna Srinivasan.

See also:
BWorld 565, Economic briefing in Washington DC, PPP Center, Tariff Commission, and agencies with no secretaries, October 21, 2022
BWorld 566, Appreciating life, family, and friends, November 01, 2022 
BWorld 567, Growth, commodities inflation, and births deflation, November 08, 2022.

EFN Asia 69, Rewind of Conferences 1998-2016

This is the list, sort of "rewind" of Economic Freedom Network (EFN) Asia Annual Conferences, organized and funded by the Friedrich Naumann Foundation for Freedom (FNF). Fraser Institute (Canada) was a regular co-sponsor. 

It started in 1998 but I attended only starting 2004 when I and some buddies in Manila formed Minimal Government, which we renamed Minimal Government Thinkers in 2008. I have attended all the annual conferences 2004-2016 except in 2007 and 2008. When FNF started co-sponsoring the Atlas-sponsored annual Asia Liberty Forum since 2013, FNF decided that EFN Asia conference in 2016 would be the last.

The photos I took from my previous posts in this blog under "EFN Asia" series, reposting some of them here.

1st EFN Asia International Conference
November 5-7, 1998, Manila, Philippines.

2nd EFN Asia International Conference
September 19-21, 1999, Vancouver, Canada.

3rd Conf. theme: ”Capital Mobility”
July 27-28, 2000, Kuala Lumpur, Malaysia.

4th Conf. theme: “Economic Freedom in Asia”
September 29-30, 2002, Kuta, Indonesia.

5th Conf. theme: “Economic Freedom in Asia”
September 24-27, 2003, Japur, India.

6th Conf. theme: “The Role of Government in Asian Economies”
September 16-18, 2004, Hong Kong.

Below, upper left photo, from left: Ellen Cain of FEF, Colleen Dyble and Jo Kwong of Atlas, me, guy from Pakistan, James Lawson, co-author of the annual Economic Freedom of the World (EFW) annual reports.

Second row, left photo: Jo Kwong, me, Joe Lehman of Mackinac Center in Michigan, USA and Ugnius Trumpa of Lithuanian Free Market Institute. Bottom photo: Cuong Nguyen, Joe Lehman, Ellen Cain, Jargal Dambadarjaa, Parth Shah, me.

7th Conf. theme: “Securing Economic Growth: Legal Structures and Property Rights in Asia”
October 1-2, 2005, Phuket, Thailand.

(Day before, September 30, FNF-sponsored colloquium, “The Constitution of Liberty in Asia”, discussing Friedrich Hayek’s book, “The Constitution of Liberty”)

8th Conf. theme: “Preferential Trade Agreements: Local Solutions for Global Free Trade?”
September 12-13, 2006, Kuala Lumpur, Malaysia.

9th Conf. theme: “Freedom of Education: A tribute to Milton Friedman”
September 3-5, 2007, New Delhi, India.

10th Conf. theme:  “Private Property Rights: The Economic Foundation of a Free Society”
September 18-19, 2008, Manila, Philippines.

11th Conf. theme:  “Overcoming the Global Financial and Economic Crisis: The Rule of Law as the Key to Economic Freedom?”
October 9-10, 2009, Siem Reap, Cambodia.

12th Conf. theme: "Migration and the Wealth of Nations"
October 6-10, 2010, Jakarta, Indonesia.

13th Conf. theme: “Competition: Engine for Prosperity”
October 10-13, 2011, Kuala Lumpur, Malaysia.

14th Conf. theme: “How Welfare Populism Destroys Prosperity: the Populist Challenge to Economic Freedom”
November 6-7, 2012, Hong Kong.

15th Conf. theme: “Asia, the Middle Income Trap and Economic Freedom”
October 21-22, 2013, Bangkok, Thailand.

16th Conf. theme: “Liberalism: Promoting Growth, Reducing Inequality”
November 6-7, 2014, Hong Kong.

17th Conf. theme: “Economic Freedom as a Way to Happiness”
November 23-24, 2015, Thimphu, Bhutan.

18th Conf. theme: “Economic Freedom and Human Rights in Business”
November 22-23, 2016, Manila, Philippines.

There will be sort of revival of Economic Freedom Regional Meeting by FNF this coming Dec. 5-7 in Hanoi, Vietnam. For some reasons, I won't be part of it. I wish the participants and the organizers success in rekindling the ideals of individual liberty, economic freedom, individual choice in the region. The past two years of horrible dictatorial lockdowns -- mandatory closure of many businesses and public transpo, mandatory stay home, distancing and masks, mandatory vaccination or mandatory tests if one is not taking the experimental, emergency-use only vax. Free marketers, liberals and libertarians should learn to push back hard. Such global dictatorship should not happen again.

I thank the FNF for giving me travel grants to attend those past EFN Asia conferences. Thanks Hubertus, Rainer, Siggi, Jules. And thanks Pett, a real "workhorse" in EFN Secretariat work.

See also:
EFN Asia 66, Meeting 2017 in Kuala Lumpur, September 22, 2018 

EFN Asia 67, Program of Conf 2006, KL, June 01, 2018
EFN Asia 68 / API 1, Launching of API in Singapore, December 29, 2018.

Tuesday, November 08, 2022

BWorld 567, Growth, commodities inflation, and births deflation

* My article in BusinessWorld last October 31.

With a generally bad economic environment globally, especially in Europe and China, it is important that the Philippines should do more investment promotion roadshows abroad and institute business-friendly domestic policies. The goal is to attract many companies leaving Europe, China, and even the US, while keeping investors that are already here.

There were four Philippine Economic Briefings (PEB) done already by the economic team — in Jakarta and Singapore on Sept. 6 and 7, New York City in Sept. 22, and Washington D.C. in Oct. 15. These are good initiatives, with the economic team talking face to face with big potential investors in big financial centers like Singapore and New York.

Last week, on Oct. 26, Budget Secretary Amenah Pangandaman and Finance Secretary Benjamin Diokno met with business leaders of the US-ASEAN Business Council (US-ABC) and reiterated the recent market-oriented reforms that are conducive to foreign investors.

Then, on Oct. 28, the National Economic and Development Authority (NEDA) Board’s Investment Coordination Committee-Cabinet Committee (ICC-CabCom) met on various project proposals submitted by agencies and government bodies, and on the approval of the updated NEDA-ICC guidelines for PPP (private public partnerships) projects. The Finance and NEDA Secretaries are co-chairs of the ICC while members include the Executive Secretary, the Governor of the Bangko Sentral, and the Secretaries of Budget and Trade.


I mentioned the bad economic environment in Europe and China as shown by their GDP growth in the third quarter (Q3) of 2022. Germany grew only 1.2%, France 1%, Spain 3.8%, China 3.9%, and the US 1.8%. Other major economies like the UK, Italy, and Japan have not released Q3 results yet.

Economies in East Asia seem to be the medium-size growth drivers in the world. Their GDP growth in Q3 2022: Vietnam 13.7%, Singapore 4.4%, Taiwan 4.1%, South Korea 3.1%. Vietnam and Taiwan were among the very few economies that did not contract in 2020, then they continued their momentum in 2021 and 2022.

The “high” growth of Spain and France in 2021 and 2022 was mainly due to “base effect” — they had very deep economic contractions in 2020, a very low base that year, and even a mild increase in economic activities in the succeeding years would constitute “high” growth already. The Philippines’ Q3 will be released on Nov. 10 but so far, we grew 7.8% in Q1-Q2 already.

One reason why Vietnam and Taiwan were able to sustain their growth momentum in 2022 is because they did not follow the US Fed’s huge interest rate hikes that penalize businesses in the name of fighting high inflation (Table 1).

I retain my growth projection for the Philippines of 7-7.5% in Q3, Q4, and full year 2022. One proxy I use is energy sales growth, then I add other considerations. For instance, in 2021, Meralco energy sales growth over 2020 was 5.7%, exactly the same GDP growth in 2021. For 2022 first half (Q1 and Q2), Meralco energy sales growth was 5.7% but Q3 sales growth was 7.1%, which is a good indicator that households and businesses are humming stronger. I have personally observed this too in many provinces.


This column has discussed comparative inflation rates in many countries before — see for instance “The ERC, NGCP, inflation and public debt” (Oct. 10). Today we will discuss important commodities and their price hikes over the past two years. I use the latest data, that of Oct. 28, and compare the prices on the same date in 2021 and 2020.

The irrational “war on fossil fuels” has produced irrational and unwanted results: high energy prices, from gasoline and diesel to electricity; high fertilizer prices, like that of ammonium nitrate because the main raw materials to produce ammonia and urea are natgas and oil; high industrial prices for items like bitumen, asphalt, and paints because their main raw material is crude oil; high agricultural prices because of high fertilizer prices, and high livestock prices because feeds — from corn, soybeans, etc. — have high prices.

The big jump in energy prices started in 2021, even before the Ukraine war. See the column on year-on-year (Yoy) 1% changes, much higher than Yoy2% changes (Table 2).

It is wrong, it is dishonest, to keep blaming the Ukraine war for the high inflation experienced in many countries around the world. Three factors produce the current high inflation situation. One, the war on fossil fuels. Two, the economic sanctions against energy and industrial exports of Russia by countries which have no territorial dispute with Russia in the first place. And, three, the huge money printing, public spending, and borrowings.


The Philippine Statistics Authority (PSA) released an update of vital statistics last week, with data until Aug. 31. Since June-July data are still incomplete, I used only data for January-May. The trend of declining births continues and I think this is troubling (Table 3).

Decline in births in 2020 was mainly due to strict lockdown by the Duterte administration — few parties and big gatherings, few marriages. These continued until about mid-2021. Then mass vaccination started in March 2021. Many reports and studies since then have supposedly established a link between the mRNA vaccines and women’s menstruation and men’s lower sperm count.

See these recent articles by my friend and fellow columnist in BusinessWorld, Jemy Gatdula:

1. “Of vaccines, heart attacks, menstruation and others” (July 28),

2. “COVID, the CDC, and the CHED’s continuing discrimination against the unvaccinated” (Aug. 18),

3. “Sanity, for now, returns to higher education” (Sept. 1),

4. “COVID vaccines may be harming our young” (Sept. 22),

5. “Are COVID vaccines harming our young?” (Oct. 13), and

6. “If vaccines couldn’t stop COVID transmission, then why were they almost made mandatory?” (Oct. 27).

All major economies in the world now have big populations. China, India, the US, Brazil, Japan, Indonesia, Russia, etc. A big population means a large number of workers and entrepreneurs, a large number of producers and consumers.

President Marcos Jr. should order a pause in mass vaccination and booster shots in the country pending deep investigations on the long-term effects of those COVID vaccines. Especially as pertaining to heart diseases (myocarditis, pericarditis, etc.) and people’s reproductive health.

See also:
BWorld 564, The ERC, NGCP, inflation and public debt, October 20, 2022
BWorld 565, Economic briefing in Washington DC, PPP Center, Tariff Commission, and agencies with no secretaries, October 21, 2022
BWorld 566, Appreciating life, family, and friends, November 01, 2022.

Deindustrialization 7, Other Europe, Sept-Oct News

More ecological and energy central planning to "save the planet", more degrowth and deindustrialization. Enjoy these reports.

1. The Dirty Job of Rationing Electricity and Gas: Elements by Javier Blas
In capping prices, European governments must embark on the messy task of curbing demand.
6 September 2022

2. Metal Producers Group Warns EU Leaders "Worsening Energy Crisis" Is "Existential Threat To Our Future"

3. Europe’s non-ferrous metals producers call for emergency EU action to prevent permanent
deindustrialisation from spiralling electricity and gas prices
 (9 pages)
September 2022

4. Western Europe now facing “TOTAL FINANCIAL COLLAPSE” – experts and analysts urgently sound the alarm
Mike Adams September 08, 2022

5. Poland says no to EU energy cost measures
In an interview with Polsat TV, Poland’s climate minister said that Poland will oppose the emergency measures for reducing the use of energy proposed by European Commission President Ursula von der Leyen
POLSAT NEWS September 09, 2022

6. ECB Scrutinizes Banks' Readiness For Possible Tsunami Of Energy Company Defaults

7. Power Shortages Loom Over Europe
By Editorial Dept - Sep 09, 2022

8. Electricity bills an ‘atomic bomb’ for Hungarian restaurants
Restaurants are facing energy bills 10 times as high as last year as the energy crisis roils the entire EU
MANDINER September 09, 2022

9. EU Ministers Call For 10% Cut In Energy Consumption
Julianne Geiger - Sep 09, 2022
* EU energy ministers are calling for a 10% reduction in electricity consumption.
* According to the WSJ, the electricity rationing plan appears to have support from many member states.

10. Soaring energy costs could threaten future of electric cars, experts warn
Industry bosses in Germany say high costs are having an impact on vehicle production and sales
Kate Connolly in Berlin 12 Sep 2022

11. Ramping Up Renewables Can’t Provide Enough Heat Energy in Winter
Gail Tverberg September 20, 2022

12. Grid Expert’s Dire Warning: “All Of Europe’s Power Supply At Risk”..30% Of Computers Could Be Destroyed
By P Gosselin on 27. September 2022

13. Grid Expert’s Dire Warning: “All Of Europe’s Power Supply At Risk”..30% Of Computers Could Be Destroyed
P Gosselin on 27. September 2022

14. Europe’s descent into deindustrialisation
The attack on the Nord Stream pipeline will encourage protectionism
Philip Pilkington 30 September 2022

15. ‘Green Energy Is Just Not There Yet,’ Says Award-Winning Reporter Eric Reguly
Karl Moore Sep 28, 2022

16. How Europe Invited Its Energy Crisis
ANDREW STUTTAFORD September 29, 2022

17. Shocked by gas bills, thrifty Dutch stockpile coal, wood for winter
Stephanie van den Berg September 30, 2022

18. Lights out: Europe's energy crisis begins to bite for clubs
Reuters Sep 30, 2022

19. Cold weather warning adds to Europe’s gloom as it battles energy crisis 
October 2, 2022

20. Energy crisis: Europeans 'must lower thermostats to prepare for Russia turning off gas supplies'
Ben Turner  with AP  •  Updated: 03/10/2022

21. China Is Rerouting U.S. Liquefied Natural Gas to Europe at a Big Profit
Sluggish economy lets Chinese energy companies benefit from high global prices
As the West scrambles to move away from Russian energy sources and imposes sanctions on Moscow, China and India have stepped in to fill the gap. WSJ examines how those countries have boosted Russia’s revenue from oil sales, supporting its economy.
By Sha Hua. Updated Oct. 3, 2022

22. High power prices ‘impacting EU clean energy supply chains’
Investments in solar PV and battery cell production could be mothballed unless electricity costs fall, says Rystad
4 October 2022

23. Gas crisis set to worsen after Europe burns through winter stocks
Essi Lehto and Kate Abnett  October 6, 2022

24. The Saudi-Russian Oil Axis Snubs Biden With Production Cuts
Javier Blas October 6, 2022

25. Rolls-Royce boss Warren East: net zero is a pain
Adam Vaughan, October 07 2022

26. Maxeon closes French solar module manufacturing plant
Jules Scully. October 7, 2022

27. Companies collapse at fastest rate since financial crisis as energy bills soar 
7 October 2022

28. Desperate Europeans Return to the World’s Oldest Fuel for Warmth
‘It’s back to the old days’ as demand for firewood soars due to gas shortage
Lars Paulsson and Josefine Fokuhl  October 8, 2022

29. The West is on the road to energy ruin
Emmet Penney 11 October 2022

30. European wind industry ‘struggling’ with rising costs
October 11, 2022

31. Weather chief: Ukraine war may be ‘blessing’ for climate
JAMEY KEATEN October 12, 2022

32. Energy crisis: Europe's winter woes driven by high prices
Jo Harper October 12, 2022

33. Why Greens Love Putin
Emmet Penney October 14, 2022

34. “Replacing Natural Gas With Hydrogen Is A Fairy Tale”…”Six Times More Electricity”
P Gosselin on 15. October 2022

35. Europe’s self-inflicted depression
European industry has been sacrificed to green ideology
RALPH SCHOELLHAMMER. 17th October 2022

36. Blackouts may be imposed on cold weekday evenings, National Grid chief warns
The warning from the head of the National Grid follows the electricity and gas systems operator outlining unlikely scenarios when blackouts may take place this winter.
By Sarah Taaffe-Maguire, 18 October 2022

37. The Quiet Desperation Of Woke Fanatics
Michael Shellenberger Oct 18, 2022

38. Reducing energy options doesn’t work. Just ask Europe—and the U.S. states where gas prices are rising
SCOTT TINKER. October 18, 2022

39. Will the energy crisis crush European industry?
While companies are digging in for a long winter, executives and politicians fear a wave of deindustrialisation
Peggy Hollinger in London, Sarah White in Paris, Madeleine Speed in Frankfurt and Marton Dunai in Budapest OCTOBER 19 2022

40. European countries are shelling out huge sums to deal with the energy crunch. Economists fear it could spark a new financial crisis.
Jennifer Sor Oct 20, 2022

41. Energy Crisis Poses Existential Threat To Europe’s Industry
Tsvetana Paraskova - Oct 20, 2022

42. Europe's energy crisis heaps pain on heavy industry
Bartosz Dabrowski, Olivier Sorgho and Jagoda Darlak October 25, 2022

43. The world is transitioning to fossil fuels
Global coal demand will reach a historic high in 2022
German energy giant RWE says it will phase out the burning of coal by 2030, saving 280 million metric tons of climate-changing greenhouse gas emissions. The decision announced Tuesday will accelerate the closure of some of Europe’s most polluting power plants and a vast lignite strip mine in the west of the country.
By Vijay Jayaraj - - Tuesday, October 25, 2022

44. Russia Ships Record Volumes of Gas and Steelmaking Coal to China
Total energy sales top $50 billion since invasion of Ukraine
Imports of refined copper from Russia doubled in September
Ailing Tan October 25, 2022


October 26, 2022

46. Energy crisis risks upending Europe's key medicine supply chains - industry says
Natalie Grover. October 27, 2022

47. Discontent Rises in Europe as Economic War With Russia Pushes Up Cost of Living
Governments fear protests against high energy prices could weaken public support for Ukraine
Bojan Pancevski and Noemie Bisserbe. Oct. 27, 2022

48. Polish Leader Calls German Energy Policy “A Curse, Fiasco”…2/3 Of Restaurants Face Bankruptcy!
P Gosselin on 28. October 2022

49. ‘Not using energy is the cheapest energy’, EU climate chief insists
Nikolaus J. Kurmayer |
Oct 20, 2022 (updated:  Oct 28, 2022)

50. US gas supplies won't be enough to fill the gaping hole Russia left in Europe
Jennifer Sor Oct 28, 2022

51. UK Trapped In The Green Energy Cul-de-Sac
Francis Menton October 30, 2022

52. Greta Thunberg throws in her lot with the anti-capitalist Left
NICHOLAS HARRIS 31 October 2022

53. Greta Thunberg says Cop27 a ‘scam’ that provides platform for ‘greenwashing, lying and cheating’
Swedish activist says climate summits are failing humanity by not leading to major change
Saphora Smith October 31, 2022

See also:
Deindustrialization 4, Other Europe, September 11, 2022
Deindustrialization 5, Germany, August-Sept. 2022 reports, October 03, 2022
Deindustrialization 6, UK, Sept. 2022 reports, October 20, 2022.