sponsored today's event, and I'd like to welcome again all of you here to CSIS. The Philippines is an important U.S. ally in the Pacific. Additionally, it makes a major contribution to the conduct of the global maritime industry as you'll hear today. We're delighted to host a visiting delegation to the United States from the Philippines, both elected officials and the private sector. So attending this afternoon is the Ambassador for the Philippines. We welcome you, Ambassador Crescia. Thank you for joining us. But now it's my great pleasure to welcome and allow to add his remarks, the Co-Chairman of the U.S. Philippine Society, Ambassador John Negroponte, Mr. Ambassador. Thank you very much, and good afternoon. I'm pleased to introduce this discussion of global maritime affairs, a topic of fundamental importance to both Americans and Filipinos. Work stoppages at major United States ports in February drew President Obama's personal attention as he dispatched both Labor Secretary Perez and Commerce Secretary Pritzker to the West Coast. The dispute brought home the magnitude of our dependence on the flow of goods to and from this country across the Pacific, something many of us often take for granted. The Philippines, an archipelago of more than 7,000 islands, lies along the region's main shipping lanes, linking the South China Sea and points west through the Straits of Malacca to the producers and consumers of East Asia. The Philippines' burgeoning economy growing at more than 6% annually depends on the shipping link to both internal and foreign markets. The country stands as the world's leading provider of maritime professionals, and that is a data point that really impressed me. At any given moment, there are some 400,000 Filipino seamen at sea of a total population of 1 million Filipinos who are active-duty seamen at this particular point in time. And now ranks as the fourth largest shipbuilding country, another data point which really impressed me. Its stake in the maritime industry is substantial, and as we will hear shortly evolving in new and exciting directions. Located on opposite sides of the Pacific, the United States and the Philippines were once separated by that vast ocean barrier. For centuries, principal waterways linking America to the world beyond its shores stretched across the Atlantic to Europe. The importance of our Pacific coast ports emerged much later. More than a century before the North American colonial settlements, European navigators embarked on that great era of exploration. burden and Magellan's attempt to circumnavigate the earth stands as an economic milestone, although he was killed in battle with the Filipino leader Lapu Lapu near Cebu in March 1521. I think there's a monument marking that event, if I'm not mistaken, which I have personally visited. Magellan's expedition effectively laid the basis for the establishment of trans-specific trade from Manila to Acapulco, presaging globalization as we know it today. The galleon trade, this galleon trade anchored in the Philippines, is sometimes called the world's first global trading system because it brought goods from China and the east to Latin America and on to Europe. And back once or twice a year, beginning in 1565 and lasting for 250 years, a truly impressive record for any international trade regime. And actually, if you go to Puebla, the city of Puebla in Mexico, you'll see many of the vestiges of that trade and the artifacts, the ceramics, and particularly if you look at the crucifixes, you'll see that quite a few of them have Asian characteristics for the Christ figure. They were definitely made in the Philippines. By the end of the 19th century, America's continental frontier finally closed as historian Frederick Jackson Turner wrote in 1893. At about the same time, Captain Alfred Thayer Mahon's treatise, the influence of sea power upon history, made a persuasive case for the benefits of a robust naval force and commercial shipping industry. As Americans increasingly looked outside the continental United States for new economic opportunities in the 1890s, tensions with Spain largely over Cuban independence exploded into conflict. And by then, the United States had established a Pacific presence. Americans came to the Philippines on May 1st, 1898, exactly 117 years ago this week when Admiral Dewey led his Asiatic squadron into Manila Bay to engage the Spanish fleet. The Pacific Ocean brought the first Filipinos to American shores in Hawaii and California in the early 20th century. It was across the Pacific that Douglas MacArthur returned in 1944, fulfilling his promise to the Filipino people. In this year, we observe the 70th anniversary of the liberation of the Philippines and the end of the Pacific War. The Pacific has been central to both countries in the past, and our common maritime interests today are undiminished. The shipping industry is vital to sustained economic development and rising standards of living. There are concerns over preserving the vast richness of aquatic resources and for maintaining unimpeded access to the major nautical highways facilitating trade in and out of Asia. The U.S.-Philippine Strategic Alliance provides a ready backdrop for enhanced cooperation on maritime affairs. This week's visit by the Philippine Congressional Maritime Delegation is serving to strengthen that cooperation, especially in areas of concern to legislators, including synchronization of shipping operations, improved regulatory standards, and promotion of educational exchanges. The U.S.-Philippine Society is delighted to partner with CSIS in raising awareness of the Philippines' role in maritime affairs, simulating more public discussion about global shipping in the 21st century, and exploring opportunities for old friends to reap new benefits in one of the world's most vital industries. And so for those reasons, and many more, I personally look very much forward to this dialogue that we're going to be experiencing this afternoon. Thank you very much. Thank you, Mr. Ambassador. And we'd now like to begin the program with two presentations that will help guide our discussion as it goes along. First, let me welcome to the podium the leader of the Philippine Congressional Delegation of the Honorable Hezli Tu or Jess Manalo. Congressman Manalo, please welcome. Good afternoon to the officers and staff of the Center for Strategic International Studies, and to all our distinguished guests gathered here today. A very pleasant afternoon to all of you, including my colleagues from the House of Representatives, Congressman Sarmiento, Congresswoman Garcia, and Congressman Jonathan De La Cruz. In a sense, this is historic to all of us. We'd like to be here again in the United States, because history would undeniably show that the Philippines and the United States have supported each other in diverse areas of mutual concerns. Today, we are very much thankful to the Center for hosting this conference. Your keen interest in the Philippines' contribution to global maritime affairs truly inspires us to work harder and help promote the seafaring as a tool for the advancement not only of the industry, but also of the other ancillary businesses and services reliant on it. We also express our gratitude to the U.S. Philippines Society in helping organize this event. The establishment of the society is one of the many proofs of our long-continuing friendship of these two nations. Truly, it is an honor for me to be here and would like to share our Maritime Party's unclass endeavor as I am equally eager to learn from all your new ideas and propose programs that can help initiate reforms for the industry I represent. When our party leader earned a seat in the House of Representative in the Philippines in 2013, one of the most important responsibility we assume is to be the Maritime Voice in Congress. It was so important because very few know what the maritime industry was all about. It only speaks about seafarers boarding the sea and yet they did not realize that 90% of world trade is run by the maritime industry. The 90% of world trade which represents close to 18 trillion U.S. dollars is running the world trade. So that voice that was introduced in Congress was necessary to show our government, the policy makers, the significant role of this global maritime industry principally run by the shipping, by the ships, as well as the crew. Without the men and women of the maritime industry vessels will not be able to sail and goods will not be transported from one country to another. The introvertible consequence of this scenario is one detrimental to the economy of the world because truly shipping moves 90% of world trade. In a book that I recently read, 90% of everything, if shipping would stop today, half of the world will freeze and half of the world will go hungry. So this is how important the industry is. The significant contribution of our seafarers to the socioeconomic development of the Philippines is a confirmation of the magnitude of the seafaring industry. The central bank of our country records show that the seafaring industry remittances have been increasing in 2014 alone. It amounted to close to 5.6 billion U.S. dollars out of the 26 billion total overseas foreign workers that we have in our country. Clearly this ever-increasing remittances comprise approximately 20% of the total remittances, notwithstanding the fact that our seafarers are only less than 5% of the total 10.5 million Filipino overseas workers all over the world. These remittances help boost the economic progress of several regions in our country. As we now serve to represent, to be the representative of the Philippine shipping sector, the big picture of the industry has been drawn and its details carved through the legislative measures that have been introduced in the House of Representatives. We have advocated for the concerns of the industry in giving it the attention and importance needed to navigate it towards a future that will promote its continued growth. We are unrelenting in our efforts to find better ways to protect our seafarers. We are persistent in promoting that our industry will always be included in the national agenda of the Philippine government. It has been our mission to champion the rights of the stakeholders of the Philippine maritime industry by principally making their concerns and needs part of the political, economic, and social consciousness of a country and its people. And we are confident to say that we have in many occasions already succeeded in making the executive and legislative departments come together to push programs geared towards navigating the maritime sector in its rightful place and significance in the national and global arena. I am truly proud to say that our Filipino seafarers occupy a premier position in the international conflicts. Records show that in the past 10 years, the demand for Filipinos to work on board foreign vessels has dramatically increased. Now the Filipinos comprise close to 30 percent of the market and there are even foreign vessels that are manned by an old Filipino crew. With the responsibility imposed on our Filipino seafarers to continuously advance world trade, we want to assure ship owners that we only deploy competent and efficient maritime professionals. Towards this end, our country has been successful in enacting a law, RA 10635, which was signed by our president in 2014, that ensures our seafarers are in compliance with internationally accepted standards of training, certification, and what's keeping embodied in the STCW convention. This becomes crucial given the need for more seafarers in the forthcoming and additional vessels constructed for shipping operations. The value of providing quality education to our seafarers cannot be negated. The insufficiency of resources, if not the lack of it, however, can sometimes adversely affect one's completion of his maritime education and training. It has long been my desire to have more training vessels in the Philippines that can help Filipino maritime students have actual onboard ship training, which is a prerequisite for them to graduate and obtain certification. And I'm optimistic that our visit in Washington, our discussions with the authorities here, are now opening doors for this possibility as to how the U.S. and the Philippines can work together to promote the enhancement of maritime education and training in the Philippines. We have also initiated efforts to implement a faster course that the youth may take to get employed onboard vessels. Together with our Department of Education and the Maritime Industry Authority, we were at the forefront of implementing the pilot maritime high school program in three carefully selected maritime schools. This program provides high school graduates opportunity to get employed as ratings in either domestic or international flits. Truth is, we decide to expose as many Filipinos, particularly the younger generation, to the seafaring industry and eventually let them see how the different yet related services can be a good source of their livelihood. We have drawn our attention to the other maritime related professionals such as shipbuilding and repair. Thus, we have a bill pushing for the modernization of the practice of naval architecture in our country. This bill aims to give a new face to how our country should look into the necessity of shipbuilding as another potential source of employment in the midst of the ceaselessly advancing technology. This bill was already approved in the lower house on third reading. Part of the objectives too is the organization of a comprehensive and orderly ship registry system for the regulation of vessels carrying the flag state. This bill intends to align our laws particularly to ship registry and enforcement of maritime claims on limitations of liability with existing international conventions and standards. This measure is a means to push us to further develop the field of shipping other than being only a premier human resource provider to international flits all over the world. Equally important to us are laws that will enhance and modernize our domestic shipping. Briefly, we have three pending bills to address some of the pressing concerns of our local shipping industry. First is the extension of the tax exemption granted to our domestic vessels. Second is the extension of the tax exemption or rather the second is a designation of a local classification society responsible to conduct technical inspection on our domestic vessels to ensure implementation of a uniformly stringent systems of monitoring of domestic flits, compliance with the safety and security standards. And in our meeting with the American Bureau of Standards, we were very pleased that they are very open to look into cooperating with our country to develop this one classification society. As we aspire to fortify and modernize our domestic vessels, we are pleased also to as I mentioned that the Bureau of Shipping, the American Bureau of Shipping, are open to provide the schemes that we could adopt and to introduce the changes that we seek. Further, we have filed a house measure geared towards the protection of seafarers who have monetary claims due to occupational hazards and illnesses against abuse of ambulance chasers taking advantage of the unfortunate circumstance of the seafarers. The bill in our country is referred as the anti-ambulance chasing up and it passed Congress on third reading and is now pending with the Senate for approval. In the filing and co-author of the bills, both maritime related to national importance, we all, we continuously take an active role in painstakingly deliberations of bills prior to their final approval, especially those focusing on maritime safety, seafarer's right and maritime labor issues such as insurance and repatriation. This is so important that we have this voice in Congress and this is the kind of discussion that will be brought to the United States. That truly the maritime, a strong force in the Philippine society and in government should also be considered by our friends and allies here in the United States. From this forum, we anticipate to hear a lot more inputs and strategic insights from the world's top experts in global challenges, regional security, transnational issues, including of course maritime security and affairs. For half a century, the Center CSIS has been continuously committed to sharing its knowledge, expertise and in-depth research towards global development which undeniably is best achieved through the help of shipping. Surely the forthcoming discussions will provide innovative ideas that can help us fulfill our objectives of introducing new policies and creating the transformation that the Philippine maritime industry needs. These reforms in turn will hopefully further fortify universal trading and expand our investment ties. I just want to close that our Philippina seafarers is part of the group that moves the world and we're proud to say that these endeavors of our country should also be shared and we need help from allies and friends from the society here in the United States and our colleagues and our counterparts in the U.S. Congress. So ladies and gentlemen, I thank you for giving me this opportunity to talk about our industry in the Philippines. Thank you Congressman. We're delighted your delegation is here in Washington. The private sector of the Philippines maritime industry is also part of this delegation and we next welcome to the podium Gerardo Borromero who is the chief executive officer of Philippine transportation carriers. Gerardo. Thank you very much Scott and good afternoon, ladies and gentlemen, Ambassador Acuisha, Ambassador Negroponte. In my remarks this afternoon, I think you might think that the Congressman and I are always talking. In fact, we are because we need to collaborate. So many of the data points that we talk about and the references that we have are quite similar and I think that reflects the alliance that we're trying to create and the alliance that we're trying to bring forward. But let me add as well my welcome to this forum, highlighting the Philippines efforts towards an expanded role in global maritime affairs and how this can promote greater opportunities between the U.S. and the Philippines. A warm round of thanks to CSIS. Sorry, there we go. A warm round of thanks to CSIS for putting this program together in cooperation with the U.S. Philippine Society and of course the Chamber of Shipping of America. It isn't every day that one has an opportunity to exchange views with such a distinguished audience. And so we're very privileged to be here with you this afternoon. At our company, PTC, we believe in this idea that the Philippines and Filipino global maritime professionals move the world. Now you might ask, how is that possible? How is that so? Congressman Manalo referred to a book, 90% of everything, Inside Shipping, which is considered an invisible industry, puts clothes on your back, gats in your car and food on your plate by the lady, Rose George, an author. It provides an inside view of the strategic importance of the maritime industry, given that over 90% of world trade is moved by ships. In effect, shipping serves as the heart of trade and economic development and continues to be an enabler for globalization and sustainable growth. Undersquaring this statement are a couple of key points. The value of materials and products shipped in 2014 topped $18.95 trillion. Over the next 15 years, it has anticipated the total trade volumes will double from 10 billion tons to 20 billion tons by 2030. Currently, there are around 80,000 vessels that make up the international merchant fleet, manned by some 1000 or 1,400,000 maritime professionals from all over the world. And of this number, the Philippines contributes close to 30% or just under 400,000 people on board these vessels at any one time. We are today the single largest source for maritime talent globally. And as such, the Philippines is a partner of equal interest to both ship owners and ship owners and ship managers all over the world. Over the last 20 years, however, there has been an ever increasing regulatory fervor requiring more and more quality built into ships, shipping and logistics processes requiring more quality and backstop by higher competency at the helm. Stepping up to this challenge, the Philippines is addressing the critical importance of education and training to the sustained development of globally qualified and competent talent, ensuring that the Philippines, Filipinos will continue to move the world. We have here this afternoon, as was described by Congressman Manalo, the author of recent important changes to our maritime legislative agenda, that is Congressman Manalo, head of the maritime party. He, together with Congressman Sarmiento, Congressman Garcia and Congressman de la Cruz, together with our maritime industry authority, serve as the new face of maritime Philippines. When you provide close to 30% of the total number of seafarers on board the world's cargo vessels, this translates into a significant contribution to the Filipino economy and it has done so. In 2014 alone, as was mentioned, the seafaring sector remitted over $5.6 billion into our economy, representing 20% of the remittances received that year. A figure that has consistently been growing at some 5% year on year. While the Philippines is the leading resource base of maritime professionals, the world's leading flag registry is Panama, accounting for over 20% of total tonnage globally. Now interestingly enough, Filipinos make up over 65% of the maritime professionals on board Panamanian flag vessels. So this begs the question, what prevents the Philippines from becoming a leading registry for ships? Or for that matter, what prevents the Philippines from emerging as a leading center for maritime services across the board? Today, the Philippines is the fourth largest shipbuilding country in the world, albeit the far fourth to China, Korea and Japan. But with the anticipated doubling of world trade, clearly the demand for vessels will continue. Given our current standing relative to shipbuilding and our leadership in maritime human resource development, a significant case can and should be made for the Philippines to continue to move up that value chain of maritime service providers. For a country with a population that exceeds 100 million today, anticipated to reach 150 million by 2050, the Philippines is compelled to sustain its recent economic gains. Inclusive growth as a key element to overall economic planning is very much needed to achieve the country's development goals. The maritime industry represents an important cluster of economic activities that can help address the drive for employment growth, income generation, and the follow-through multiplier effect of expanded spending among those positively impacted. With Asia front and center on the agendas of the world's leading economies and with ASEAN implementing its long-planned integration into a dynamic regional growth market, it is critical for the Philippines to keep in step with the rest of the world. A determined strategy, therefore, to engage in the global maritime arena provides the Philippines a means to do so, particularly with its more developed Asian neighbors, Japan, Korea, and China who are all giants in the maritime arena. It would also allow the country to collaborate more closely with the U.S. on maritime issues central to free trade and regional stability, particularly with recent events surrounding what we call the West Philippine Sea. Cooperative activities between the Philippine maritime sector and counterparts in the U.S. can range from maritime education and training to shipbuilding and repair and even defense-related industries to lead the development of a more robust engagement leveraging on our country's long-shared history and mutual interest in global maritime activities. Today, maritime Philippines is facing interesting circumstances. With our country's focus on the shipping industry, the time for us to act is now. In the days of sale, these situations were called oportu, the Latin phrase from which the word opportunity, the English word opportunity is derived. It describes the mix of tide and wind that allow the vessels to come to port. For us in the Philippines today, maritime Philippines, the tide is rising. At the same time, opportunities abound for maritime USA and they're very much present. So if we look at this together, the work we have before us will allow that momentum of the tide to bring us forward. And it is within, with this in mind that we are here with you to share our views and we look forward to a discussion in a short while and also to some words of advice from Joe Cox. Thank you very much. Thank you. We're now joined by our third panelist, Joseph Cox, Chief Executive Officer of the Chamber of Shipping of America. You better put me in the middle here. Well, Joe, we'll split up the delegation here momentarily. But let me start our panel discussion by asking Joe for his perspective and observations based on what you've heard so far. Well, thank you, Scott and ambassadors. Welcome here, ladies and gentlemen. I'm sure that some of you, my friends sitting out there saying, why is Joe Cox sitting up there? And I can only say that they would share the question with my four immigrant grandparents who would say, how did you get there? And I would answer them by saying, good genetics. But as to why I'm here, I think we can go back to the phrase, well, it's been used by all three of those previous speakers, including Ambassador Negroponte. And that is the 400,000 seafarers that are Filipinos that are on our vessels. And when I say our vessels, the Chamber of Shipping of America represents American companies that own operating charter ships. We are very active and robust defenders of our Jones Act. We are also very active and robust defenders of the American presence in the international industry. And indeed, this is an international industry. And I just wrote a few notes about the 400,000 seafarers. I think that's slightly misleading, gentlemen, because the number of officers represented in the Filipino maritime engagement is not that large. The majority of the 400,000 are ratings, if I can use that as a generality. And if you say that, then suddenly this 400,000 becomes even more important, because if there are 80,000 vessels, and I'm just guessing at numbers, let's say 20,000 are just so close to various shores that they have their seafarers on board. So you have 60,000 vessels out there. Given the crew sizes, I think that we could look at about half of the world's ships are being manned by Filipino seafarers. And I think that's an even more telling statistic. Now, why am I here? I think many years ago I met Dito, well, not that many years ago.  Yeah. Carlos, I met him probably 35 years ago. We were at the International Labor Organization in Geneva. And we were debating various conventions which dealt with seafarers' work and their rights at work and their protections. And after a period of time, we, the ship owners, saw the opportunity to say, we are really wasting our time here dealing with international singular standards. So we said, why don't we have an overarching umbrella convention that deals with seafarers' working conditions, living conditions, and their basic rights? And we, the ship owners, presented that to the international labor community, represented then by the International Transport Workers Federation. And we said, let's have a uniform, all-encompassing convention. And it took us, I think, eight years. But we combined 65 conventions in the world into a single and forcible maritime labor convention. And I am quite proud in my professional career to have played one of the major speaking roles and leading roles for the development of that convention. And so the reason I am here is to further the Filipino aspirations to become a more active participant in our maritime world. And I think anything that I can do to assist the workforce of the world that is operating on ships, and I confess, I used to go to sea myself. And I know how it is to be treated like a seafarer by certain individuals, particularly those who want to give you shore leave or not give you shore leave. And so I have a very sensitive spot relative to the seafarers of the world. And anything we can do to raise the level of all seafarers is certainly something acceptable. And I'm going to talk to the chairman later about his ambulance-chasing legislation. I don't know whether I would even want to suggest that in the United States. We will consider the word. Anyway, turn it over to you. Thank you, Joe. Appreciate that. What I'd like to do is start a discussion here by asking Congressman Manolo and Gerardo to comment a little bit, if you would please, on your conversations with US officials. You're here. You're making what I think is a very compelling case for a partnership between the United States and the Philippines. And I think our audience would be interested to hear what kinds of things have you heard? What have you learned? Are there a couple of key reactions to your meetings this week that you'd like to share with the audience? Basically, our discussion with our first with the executive branch of the United States from the Department of Transportation. I consider them very positive developments when they consider that we could study the possibility of an exchange program for our seafarers. For our students, most specifically, that they can come over and study and revive the strong exchange programs to uplift standards of education and training. And they always mention to us that they will look at it and they're very open. Secondly, when it comes to the standards of classification of vessels, they said that they're willing to look into it and they'll ask their counterpart, the lawmakers also, if they're not restrictions. But from the lawmakers, from the people in Congress, we got a very much positive view because we've talked to Congressman Salmon and he said he would love to go to the Philippines. And three of them said, yes, send the invitation because truly we have probably not seen the value of ship repair and ship building the potential in our country. So those are things very positive to us and for a few days of discussion and for a few minutes of meetings with them, this I would consider to be quite substantial already. That's great. Gerardo, any reactions? No, I'll echo what Congressman Manalo said. I think as far as the US Maritime Administration is concerned, there is a recognition of the fact that the US is a maritime nation and that they do need to reach out to the rest of the world and so the opportunity to exchange views and to establish cooperative programs with the Philippines is something definitely of interest. But when we were on Capitol Hill today, what we saw going through the halls of Congress was democracy in action and you would see all of the little conferences going on and it amazes me how all of the leaders within Capitol Hill can actually focus on all of those ranges of topics. But when we stopped and talked about the Philippines and our interests, they focused in and they recognized that yes, there is a need to actually build these bridges just because world trade really depends on the maritime activity. So what we need to do is follow up with these initial discussions and between the public sector and the private sector holding hands, working with our counterparts in the US with the Chamber of Shipping of America, be able to establish focal points, whether it's in maritime education and training, whether it is in terms of cooperative shipbuilding activities or other maritime related services. This is the opportunity for us to carry forward. Given the scale of Filipinos as professional staff of the shipping industry worldwide, when you first shared those figures with me, I was stunned by the sheer number of Filipinos working as professional mariners. And I thought to my travels through airports, I was at one time in my life a relatively frequent air traveler and I always noticed when I was standing in the immigration line, even the immigration line returning to Dulles Airport that there was a line over there for the air crews, the pilots and the flight attendants that seemed to move a lot faster than the line I was in almost regardless of what circumstance. Can you characterize whether that kind of treatment by a receiving nation when a ship makes port of call is the same for the professional maritime crews as it is for pilots or what are your expectations in regard to the treatment of your nationals abroad? Well, basically we want to change the mindset of the immigration people and probably some countries that the seafarers or the people that run the vessels are equally important just like the air crew. I would always say the ship would cost close to 100 million US dollars. The cargo would probably carry about 20 million or 30 million and these crew are as important as the rest. They're global maritime professionals. In our country we used to think that probably the seafarer may not possess the mind of a engineer or a lawyer but right now the sophistication or the build of the vessel is so upgraded that you need very intelligent people and these are the people that man.  I want our seafarers that they leave they will experience a business class lounge and our country has agreed that they will give our seafarers that opportunity, that opportunity of being treated well and in other countries maybe a policy that can be open where they can be given a card of an immediate access just like the crew of the aircraft of the airplane. So I think we're going there, the recognition as one Joe mentioned, the ILO is already recognizing, we have the ILO 185 that recognizes the standard card of all the seafarers and once that's in place you can have that card and you can go to any country in the world and you can work anywhere and it will be recognized because that's readable. So things are developing and I believe that they will reach that level of equal importance to the rest of I would say transportation personnel including comparable to the pilots and the rest of the industry. Great, thank you. Well let me now turn to our audience. You've been very patient and I hope that you like I did learned a lot about the Philippine maritime industry I'd like to open to questions. Basically three rules for questions here. First, please wait for the microphone because this is being a live webcast and recorded and no one will hear your question if you don't have the microphone. Second, when you get the microphone please identify yourself and the organization you represent and third, please make sure your question as Alex Trebek would say is in the form of a question. Thank you, with that look for anyone from the audience with a question. Yes sir. Hi there, my name is John Gallagher. I'm with IHS Maritime and Trade here in Washington. Wanted to know if you could, one of you explain where a Philippine stands within the Trans-Pacific Partnership and what potential opportunities there are on the for maritime trade through that partnership with the Philippines or that trade agreement with the Philippines. Was that the Trans-Pacific? Yeah, the Trans-Pacific Partnership. So I mean I can make the comment that right now the Trans-Pacific Partnership is a 12-party agreement. All the members of the, all the negotiating parties are members of APEC as is the Philippines. In fact, Philippines is the host of APEC this year and but I can't speak for the Philippine government. I believe there have been expressions of interest in joining the Trans-Pacific Partnership but I can't go beyond that. Mr. Ambassador, do you care to comment or I don't mean to draw you into this but. As you said, the Philippines has indicated an expression of interest to join the TPP but we also recognize that we have challenges and one of these major challenges is the fact that there are still restrictions in terms of foreign ownership in certain sectors of the economy which would require an amendment in the constitution. Congress is addressing that and I think Congressman Manalo could talk about that. The Speaker of the House introduced a bill that would allow Congress to set the legislation instead of it being in the constitution but that's going to take time. I don't, I can't tell how long but we are already undertaking informal, I wouldn't say negotiate but informal discussions with various countries among the 12 that will be the original members of TPP and we're hopeful that we could exceed in the next round when that will be, we don't know but we are preparing for that. Thank you, maybe Scott, maybe I could add some perspective from the private sector standpoint. I think that when you talk about global trade inevitably it's important for the Philippines to be participant in that. As to the rules of the game, I believe that continues to evolve and we will participate in the best manner that the government feels that is proper. However, when you look at it from the perspective of shipping, shipping will only follow trade. We can only do so much and you've got to be able to create the ground rules for which trade will facilitate itself. What we would like to be able to do in the context of the maritime cluster within the Philippines is evolve from not only providing people but being a place where ship building, ship repair and all sorts of allied services that can use the Philippines as a platform for the rest of the world can take place. So while we would like to participate in trade arrangements like TPP, we will wait for the proper time for that to happen. In the meantime though, we are already looking at what we can do within the shipping industry which serves as a backbone for trade to ensure that at some point or in some manner we will participate whether it's through our maritime professionals, through services that support the shipping industry. So we will be there in one form or fashion and we hope that at the appropriate time we will participate in the broader alliances that are being generated. Thank you. Kairus, did you have a point of view? Well, to follow up the point raised by our ambassador, Ambassador Quisha, indeed Congress has already initiated the measure to lift the restrictive provisions in our constitution and it's not, it is amending the portion of the economic provisions that would allow ownership of certain industries by foreign nationals. So that is already moving and it has the support of our speaker and the Senate president and I do hope that this bill would eventually pass into a law before the 16th Congress ends. That's good news. Thank you. Yes, there's a question in the middle here. Yes. Yes ma'am. Good afternoon, I'm Mitsy Picardens. Good to see Gerardo Borromeo after our high school days. Detail or Gerardo, you mentioned about the West Philippine Sea. I'm with the US Filipinos for good governance and I was with Asia Society for a long time. My question is how is the Philippine maritime industry dealing with the West Philippine issues? And then my second short question is how are you dealing with the illegal recruiters, especially with the incident of Mary Jane Veloso? Is that rampant also amongst the seafarers, the illegal recruiters? Thank you. Shall we take on the next question? Let's put it this way. I think that when you talk about the West Philippine Sea, that is more a political issue and it is an issue properly put with our government. As far as the private sector is concerned, we look for access to trade navigation routes. So it will be in our interest and not only our interest but the interest of the rest of the world to have free navigation because free trade requires that we are able to move from point to point and shipping doesn't really see any boundaries. We can't see boundaries. We are there as a logistics backbone for world trade and we need access in order to be able to bring goods from point A to point B. That's the only way we're going to be able to move the world. So we wait for the governments of this world to be able to provide the necessary access and we will follow through. When you talk about illegal recruiting, I think that's always an issue but as Joe Cox had mentioned that within the framework of the International Labor Organization, there are very well established governance policies that look after seafarers rights. In fact, the Magna Carta of seafarers which is the Maritime Labor Convention of 2006 which is considered the fourth pillar of governance within the maritime industry is very, very clear and it actually sets seafarers or maritime professionals apart from those that are recruited for land-based activities. So you actually can set these two people apart or these two types of professional workers. We're very well governed of the seafarers are very well protected and in fact, I'd like to pass on the rest of that question if I may to Joe, no, you can talk about, you can talk about how well protected seafarers are and because of that whole governance structure and the fact that we have an employment administration within the Philippines, we're far ahead of most other countries in terms of protecting the interests of maritime professionals. Yeah, to carry it on, I was the spokesman for the ship owners in the social security area which is where wages and that came into the discussion and certainly illegal recruiting is something that's not just, it's endemic, it's not something centered just in the Philippines, it's around the world. And there's an aspect of the maritime labor convention which puts responsibilities on the labor-supplying countries. So they have to take certain steps and satisfy themselves that they are doing the right thing with respect to their seafarers. Concurrent with that obligation of the labor-supplying country is the country who is hiring those seafarers has to ensure that their ship owner is ensuring that the labor-supplying country is meeting its obligations. So there's a concurrent obligation on the shipping company or the flag of the shipping company to say we are checking up and making sure. And so we took a long time to make sure that there was that connection between those supplying and those who are hiring to make sure that there was no, it's going to be perfect, I assure you. As I sit here, there are people who have thought processes that could get around it, right? But we did the best we could at the time. And if there are things that pop up down the road, there's an amendment process to the MLC. And I'm sure we meet yearly as a special tripartite committee to take a look at the abuses that could start to arise. So we haven't just take care of the problem, we think we've set up a process whereby in the future we can continue to address problems as they arise. Let me take that point from Jeff. The protection of the seafarers in our country is well covered by the ILO. That's why I was constrained to file the anti-ambulance chasing law, simply because of the protection given the seafarers. In the normal disability cases, if you're covered by the CBA or the International Convention, this disability amount is tremendous. And what some people are doing is they take advantage of this provision that allows the payment of disability to the seafarers and they do the ambulance chasing. And it is immoral, to my mind, the moral concern of getting only 20 or 30% of that amount that would go to the person who was endured and let these ambulance chasers get more. That's why I was prompted to file the bill and I would make this ambulance chasing principle criminal in nature. And it has passed the third reading in our house and it's now supported in the Senate because we want the injury, the person who was endured to get the full compensation because that's what the insurance is all about. So that is the kind of protection that we want to put to our seafarers. And I think the house and the lower house and the Senate has seen that this is an industry that should be protected and to be paid, those who were endured should be paid and not those people who are trying to take advantage. So I'd like to take that up because I'm very passionate when it comes to the protection of rights to our seafarers. And Chairman, if I can add to that to put a sort of a monetary thing on it. Once a seafarer is injured on board a ship, the shipowner has a responsibility to put him back to where he was before he got injured. And so in the US we call it maintenance and cure. Part of that maintenance and cure is full pay. And so it's not a small matter. We're talking about the person's full pay and somebody coming by and saying, I will take 20 or 30% of that. So I congratulate you on the fact that you're creating a legal remedy within your law that isn't going to have to take somebody taking that amount of money from the seafarer in order to accomplish what is supposed to happen. Yes. Okay. Thank you. Ambassador Meister. Question in front of them, we'll get in the back. Thank you. This is a bit of a political question for both sides. Do you introduce yourself first? Yeah, my name is John Meister. I'm President of US Philippine Society. That's our logo up there to the lower right. If you had to choose one or two of the things that you would like to see our respective governments do in order to advance this particular agenda. On the Philippine side, what would you recommend? And on the American side, what would you recommend? And I don't see any problem with each side telling the other what it should be doing. I'm talking about executive branch decisions or congressional actions that are going to advance opportunities for cooperation in the maritime area. Can I take the lead? Sure. I think the essence of shipping has to be sustainability and safety. The sustainability and safety of shipping is dependent on the individuals that we put on board. And the individual must be trained to the highest standards, to global standards. And so if there is an opportunity for the US and the Philippines to cooperate, it has to start with maritime education and training and establish the basis of training and development from the highest standards to global standards. Because if we have that, we can then regenerate the resource on a continuing basis in order for shipping to be a sustainable industry. So I would start just on the basic of the fact that we have to have a core curriculum, the faculty that can be trained and therefore provide students that are necessary. And we talked about the fact that we could create exchange programs because on a ship, you don't necessarily have one nationality. You can have multiple nationalities. It's a multicultural environment. So being able to understand different cultures working within an enclosed environment for a prolonged period of time is very, very important for the sustainability of teamwork. And so the more we can expose both American cadets and Filipino cadets in training exercises, then I think the better it is for both our countries and for any other country for that matter. So at least that's one point that I think we would like to stress. Joe? Yes, I think when Dito and I were talking and we've spent many an hour over at the Injunivan in London talking about various things, but the fact that what could we offer, a question comes to my mind, I'm not gonna ask the question, but that is with 400,000 seafarers, what percent are officers? And then an ancillary question that I think we have to ask is, how many aspire to be an officer? And so how do we create a process in your country where you can take advantage of those aspirations of truly talented young men and women to rise in the ranks? How do we do that? And tomorrow we're going to be visiting the Seafarers International Union Training Facility in Piney Point, Maryland. And I think they do an exceptional job at training ratings, but they also have an aspect of their training where they say we recognize that some of you are gonna go forward. And so they give them an initiation into that structural teaching that would be necessary to become an officer. And so I think that's, I'm going to enjoy the reactions tomorrow to seeing there for some reason. And that's timely because I think the pet project of Congressman Manalo is the Maritime High School. Well, let me put it this way, Joe. We have 91 schools in our country, Maritime Schools. And out of the 91 schools, only 8% become officers. So I went to the data. I went to the statistics. Why is this so? And it boils down to a very simple thing. These 91 schools, because of the law that was passed that I principally authored, we were able to reduce the schools to about 23. Because these 23 schools are the schools that have the training facilities and the training vessels that allows cadetship program. So what is needed is what Joe is saying. How do we move our ratings to become officers? Is the eventual production of students who will go through the process of a cadetship. It's a training vessel that's so crucial to us. You need that in order to comply with STCW that you need one year of cadetship program before you can take the exam and before you can become an officer. So we have identified the solution. Yes, we're producing a lot of ratings, but we need to find the balance, the balance of producing the ratings and the officers. If we produce enough officers and ratings and that would eventually meet the supply and demand of international demands. But what we're saying is without the officers, the Philippines will remain in that level and that's what we're working that eventually our graduates should move towards becoming an officer. And we have developed two programs now because of this law. There's what you call the enhanced level course. In other words, if you want to be a rating, just study for two years. If you want to be a ship officer, study for four years in one year of cadetship program. So now you have the choice. So if we create another law that will move towards the laterized education that the seafarers of this rating can eventually move up to become officers, that would give an opportunity for our country who are actually underemployed or needs the employment to work for two or three years as rating and eventually move up, laterized and become officers. And I think that would produce the kind of good officer that we need because they're exposed to the sea.  You graduate from the best school but you don't have combat experience. You will lack something. So I think this program that we're doing, the maritime high school, the enhanced level course because of the law that was passed in our country, we can assure our friends, our colleagues in the shipping industry that we're gonna produce good people. Now would it achieve some of Gerardo's goal of sustainability? At the first level. Yes. Beyond that, then there's a ship. What can we do with the ship in terms of managing the ship? There are all sorts of ancillary services where we can manage the ship, whether it's on board the technical management or support services that go around the ship. And so again, the Philippines can serve as a platform because we can be the back office for many of the services that are used to support shipping operations. And again, that is an area of cooperation between our two countries. But when you talk about the ship itself, we can do a lot in terms of the repair of the ship and even the building of the ship. I mean, I mentioned the fact that we're the fourth largest ship building country today, although a fourth to Japan, which is in third place. But with an interest, say for example, to utilize the lower cost platform of the Philippines, we can build ships. We can also repair ships. So ships that are trading in the Asian region and you will see more and more of that happen as the nucleus or the nexus of trade comes to Asia, then we become a central point, a hub for this type of activities. And again, there are industries within the US where they can collaborate with Filipino partners to be able to create that sort of platform within the Philippines. So there are various stages between looking at the ship, looking at the people who run the ship and even the handling of cargo where the Philippines and the US can cooperate on various fronts. And I think this is the kind of maritime cluster that we're trying to create and an opportunity to discuss the rules of engagement when you talk of global maritime affairs. Sure, thank you. There's been a lady in the back who's been very patient. Yes, in the green suit. Yes. Hi, my name is Beth Muang, with the Governor's Commission on Asian Pacific and another organization, the Alpafai Omega District of Columbia. My question to the panel, one is that Congressman Manala, I'm glad you're there, because I have a brother who's a graduate of the PMMA, Philippine Merchant Marine Academy. And so my family, I live in Subic. There are two shipyards there. And so I am in this industry. My question to you, you mentioned about benefits, monetary claim. Is there a set aside funds by the government for those sea favors who became a hostage related to piracy? Well, with regards to the piracy issue, the piracy is not a local issue alone. It's an international issue that I believe we're trying to solve it. And the only fund available from the Philippines is providing what you call the repatriation because the rule on piracy is that we pay no ransom. So if they're really in that situation, no government will eventually pay the ransom to these people. And we use diplomacy. We use the functions of government to diplomatic pose to really find out what can be done. But the rule is we make no payment. And I think that government policy stands even today. Thank you. Yes, sir. Question here and we'll ask, but I think Oh, I'm sorry. I was hoping it'd go on too, but the Maritime Labor Convention does have requirements about paying seafarers. And while it's a slightly gray area, it's my personal opinion and one that I would articulate in Geneva if the question came up. The fact that a ship has been pirated, the seafarers are still on board. The ship is still actively in operation, although it's being withheld from doing what it wants to do. So in my experience, most ship owners have continued paying the seafarers until such time as there's a resolution of the piracy. And most governments will not pay ransom because it only encourages more piracy. And I understand that argument, but at the same time to say to the seafarer, well, you're not getting paid anymore because you've been pirated is something the industry does not accept. So the continuing payment of the seafarers and allotments going home to their families in my experience has continued. Now there may be ships where that did not happen. And there is, there are a couple of cases where I'm sorry, but a disreputable owner walked away and ignored the vessel. And that's unfortunate. But at the same time, the MLC does have provisions that will handle that and it's up to the flag state then to take over the responsibility. Yes, we have a question here and a question in the middle of the back there and one here. So let's take these three and we're running out of time. I'm sorry about that, but we'll take the questions and then go the answers. Yeah, thank you. My name is Eddie LaChica, I'm a retired journalist. I was wondering whether the Maritime Delegation could bring its excellent ideas in the context of the ASEAN economic community. This raises a tricky question, whether the Philippines can regard Indonesia, which is the largest archipelago, also the source, the second largest source of seafarers in the world, whether you could regard Indonesia as a partner or as a competitor. You know, one idea that came out, I think from the Arroyo administration, for instance, was to link the construction of RO container ports with the similar building that Indonesia is doing in other words, to work together collaboratively instead of as competition, like for instance, do we all build Panama's container ships and create a collective world or do we specialize, for instance? Okay, hold on to that question. Let's get two more here and it's a question here and one over here, yes. Rapid fire question to answer. Dave Halliday with the Spectrum Group. My question's about shipbuilding and ship repair. I had a recent conversation, I believe it's true that our expertise in shipbuilding and ship repair is kind of retiring internationally and while we are still building ships, we are not advancing in technology like we are in the cruise industry and in the yacht. Sir, who is we? I'm talking internationally. Okay, the world industry. The world is a whole. Okay. So my question is, how are you going to face this challenge of recruiting shipbuilding, ship repair personnel to work those shipyards and build the ships needed for the numbers that we're talking about in the future, which are astounding. Sure, okay. Third question was up here. Yes, sir? My question has to do with... Could you introduce yourself first, wait for the microphone then. Thank you. Henry Howard, US Philippine Society. My question, oh, and by the way, Philippine Council in Florida, I forgot, thanks to one. Great. My question has to do with the effect on the shipbuilding industry in the Philippines in light of the new parallel Panama Canal locks, which will scale up the ships beyond what we all know as Panamax sized ships. Can you scale up the shipbuilding facilities to accommodate the construction of these larger post-Panamax ships? Okay, great. Yeah, so that's the lightning round. We have Indonesia-Philippines cooperation. We have the Panama Canal effects on shipbuilding and general shipbuilding technology change. So take them in any order. Let me take the first one. I think that the mention of Indonesia is good. My personal belief is competition is good. Competition will bring out the best in what we're able to do. But let's take that in the context of the fact that world economy will continue to evolve. There will be more ships and therefore demand for those ships, we will need more qualified people. Now, because we are all moving towards a higher global standard, then it will be the market that will decide who among the people, who among the countries will be able to provide that. And I'm very confident with the support of the government, with the continuing interest of various ship owners in the Philippines, that we will be able to continue to produce the kind of seafarers, maritime professionals, not only as ratings, but really as officers. And so I'm very, very confident that we will continue to be a leader in providing these, notwithstanding the fact that there are other countries out there that would also like to promote their people. Like I said, for us in the private sector, competition is good, competition is essential, and it'll just bring the best of us. Turning to, let me take this one in the context of the third. In terms of shipbuilding, you will be surprised to learn, perhaps, that one of the shipyards at Subic, the Hanjin shipyards, has already taken three orders for 20,000 TEU containerships. So, postman, so we have the capability. But again, as a shipbuilding country, we are dependent on designs that are brought in by other countries, by other companies. What it reflects is the fact that the Philippines is a flexible platform. We have the resources. In fact, a lot of the people who are currently working on ships have developed a global skill set that can be brought back into the Philippines, whether you're talking about machinists, fitters. All of the people who have had that kind of technical skill are actually skills of a global nature. They can be brought back into the Philippines, and this is the inclusive growth model that I refer to. Because as opportunities arise on shore, they will want to come back, but it opens up an opportunity for a whole new set of Filipinos to go on board, and we then continue to perpetuate that whole effort. As an aside, if we have many Filipinos working on cruise ships, they are already exposed to the highest global standards of tourism, hotel and restaurant management. They are the immediate resource that can be brought back to the Philippines to support the government's efforts to enhance our tourism capability, which again opens up an opportunity for new Filipinos to go abroad. So in terms of the skill set, so Joe, maybe you might want to take the thing of a very seeding shipbuilding capability. Yeah, I wanted to, I was thinking about checking an egg because I think the Panama Canal actually expanded because the shipyards around the world were building larger vessels because of the economies of size. You can move a lot more goods with the same ship, and that made sense. So they built it up. You wouldn't be surprised to know that their ships now that won't be able to go through the expanded Panama Canal, hence we get people talking about Nicaragua Canal, all right? Nicaragua Canal, correct. So you see where things can go, but the and don't get me started about whether or not their logistics assure that are going to be capable of handling that amount that's going to be coming in. That's a whole other story. And our nation is not currently capable of handling that. Yes. All right, but to the skill set, I think these shipyard jobs are really very good jobs. They're well-paid, and I find that where there's well-paid jobs, there's training institutions that begin to arrive to begin to train young people. The problem with shipbuilding is that what happens when there isn't a ship being built? You can be very active when the ship is being built. And so certain government supports in certain countries say, well, we're going to build a ship anyway. Well, it isn't like the field of dreams, you know? If you have too many ships and too little cargo, somebody starts to lose a lot of money, right? And currently we're in that process with the bulk carriers today. There's a very serious problem associated with that. But I enjoyed the questions because of the synergy of the entire industry. And we brought in the education issue, Gido, which I think is the baseline hallmark of what we're trying to do in this industry. And you emulate that within the Philippine society. How do we educate our young people to bring them up to take these opportunities? Well, I'd like to pick up that point on shipbuilding that was us. Of course, the economics would depend on whether you will need these vessels. But insofar as the Philippines is concerned, we have actually already, we're moving towards modernizing our naval architecture law. In other words, we will encourage naval architects. We will encourage these people young age to be looking early on under our K-12 system, that they will look at the technical aspect of drafting, using the CAD, and then exposing them to the ship repair facilities in Subic, in Cebu. So there will be a place there in seeing these things. Early on, you'll develop now the imagination of young people preparing for that eventuality of being able to be taught how to build ships, how to draw ships, and how to design them. And when it comes to competition, I do believe that all the rest of the world want to take over the 30% that the Filipinos are there. So that's why we have filed a bill to improve our education. Yes, we're going to compete, but it will be very difficult for them to get the genetic genes of the Filipinos that love the sea. Maybe Scott, I think I echo Congressman Manalo and that's why I feel very confident. But maybe Mr. LaChica, we can turn that question around because there's something interesting related to technology. The ships that we're talking about today are ships that are going to continue to be built through, say, 2018, 2019, 2020. The designs of those ships are already in place. But let's consider what kind of a ship is going to be out there between 2020 and 2030. What are the technologies that are available? You just have to look at drone airplanes. You look at the Google driverless car. That kind of technology is beginning to become available and as bandwidth becomes available, telemetry will take over and maybe more and more control will be short sight. Now I know this is an ongoing debate that we've had interesting discussions with Joe, but if that does happen, then the number of people on board the ship may not be as many. So while there will be competition from other countries, I think there will be competition from technology. So the kind of maritime professional we need to build in the future has got to be technology oriented. And this is why when we talk of education and training, what better place to come than America where technology is a part and parcel of the whole educational process. And that's very, very important for us because we wanna be able to build a maritime professional of the future. When you consider that in the Philippines, you have to go through four years of college to be able to become an officer candidate and then one year at sea. And then it takes you another 10 years to going from being a cadet to becoming a captain or chief engineer. You're talking about 14 or 15 years. So what is the ship of 2030 going to be like? Because that's the time when the person who is in school today is gonna become the captain or the chief engineer. So we have to add that dynamic to the whole discussion. So there are short term issues that we need to talk about, but there are longer term issues which involve technology, which involve an understanding of process and the impact it has on people. That's why working hand in hand with our legislators are so important because we need to have the kind of policies that are long term. Our view must not be just for today. It's gotta be 2030, 20, 40, 2050. And when we talk about a global alliance and a global maritime issue, talking about a country like the United States is an important element because the United States will continue to be one of the engines of growth. And being an engine of growth, trade will happen. And if trade happens, then inevitably all countries who wanna participate in that trade will be able to participate. So we've gotta go back to the basic fundamentals and this is where the discussion, the visit, the encouraging visit with the congressional delegation should be just the first step of many other opportunities. And this is where I hope that the US Philippine Society will continue to take maritime affairs as an important multiplier industry because it does have far reaching effects and as well with you, Joe. Part of our discussion, I think, involved the maritime limbo contest, I call it, which is, how low can you go in manning? And we can get that. And I think, frankly, we have to take into account the social impact of a very small crew on a ship that's spending two to three to four weeks at sea. And so we aren't gonna get down to zero like the drones, though, are we? No, no, I don't think so. No, no, no, no. It's okay. You gotta have at least one person on board. Well, listen, one of the best things about working here at CSIS is the fascinating range of issues you get to work on and the fascinating people that we get to engage here. So we thank you all for coming. Mr. Ambassador, did you have the last word or? Just one. We'll get you a microphone here, just a hard answer. Before I raise the question, I just wanted to make a comment that when I visited three major cruise lines, the Carnival, Royal Caribbean, and Norwegian, all three said they had about 61,000 seafarers and hotel employees. All three said that they were very happy with the performance of seafarers and hotel employees and they would like to hire more because they gotta be building more ships. But the question I have is that going back to the West Philippine Sea, since China is undertaking this reclamation activities and it said that within probably the next few months they gotta complete the reclamation, they have airstrips, ports, et cetera. Once China deploys military and civilian personnel in these features, the question is would that not imperil the principles that the U.S. has been advocating which is principle of freedom of navigation and unimpeded lawful commerce? Maybe Mr. Cox, you may want to just give a comment on that. I'm smiling because Ambassador, I've twice testified before the U.S. Senate Foreign Relations Committee in favor of our accession to the Law of the Sea Convention. And I think all the comments of our government about freedom of navigation and the use of the seas is embodied in that convention. And I find it ironic that we're referring to the very basic requirements in the Law of the Sea Convention as the basis for our allegations about improper activity by another sovereign nation. And I think that a good starting point for the United States government would be to exceed to the UN Law of the Sea Treaty. And then when we clean up our own house we can talk about others and the activities that they are taking. Well, if that is a jumping off point, let me thank you all for coming this afternoon. Please join me in thanking the panel.


Ladies and gentlemen, please rise and join me in welcoming His Excellency, the President of the Republic of Indonesia, Joko Widodo, together with His Excellency, Samdech Hunsen, the Prime Minister of Cambodia. Ladies and gentlemen, distinguished guests, Your Excellency, Bapa President Jokowi, President of Indonesia, Your Excellency, Prime Minister of Cambodia, Samdech Hunsen, Your Excellency, Deputy Prime Minister of Vietnam, Wien Suan Phuc, and Your Excellency, Deputy Prime Minister of the Russian Federation, Arkadiy Vokovich, Ladies and gentlemen. In January, the World Economic Forum has been officially recognized as an international institution for public-private cooperation. This is a major contribution to our mission, committed to improving the state of the world. Because all of today's challenges, like our thrive for inclusive growth, like our fight for food security or environment protection, all these challenges can neither be solved by the private sector nor by the public sector alone. You always need public-private cooperation. And you are all our guests today in our East Asia Summit, under the theme, Anchoring Trust in East Asia's New Regionality. And ladies and gentlemen, a warm welcome to all of you to our 24th East Asia Summit under this new theme, under these new statues, a warm welcome here in Jakarta. But what does it mean? Anchoring trust, new regionalism. Let me tell you a short story. I was born in 1973 in Vietnam during the Vietnam War. I lived the first month of my life in the Catholic orphanage. I was then adopted by a German couple as a little baby. And this couple gave me the chance of my life. I grew up in Germany. I went to school. I went to university. I became a physician. I then joined later politics. I was a five-year federal minister, first federal minister for health, later for economics. At the same time, I was vice chancellor of the Federal Republic, so the deputy of Chancellor Angela Merkel, and I was the first federal minister with an immigrant background, with an Asian background, with an Asian face. So indeed, thanks to my parents, I got the chance of my life. And thanks to my country, Germany. But ladies and gentlemen, this is not a story about my parents. This is not a story about my country. This is a story about East Asia. Because in the last 40 years, since I left East Asia, the region has totally changed its face. Your father and your grandfather have created the great idea of the ASEAN community, which is becoming more and more reality. And look around you. We have so many fast-growing societies, fast-growing middle classes, and dynamic economic growth. Look, for example, into the impressive numbers of our host state, Indonesia. 860 billion GDP, 6 percent expected growth for this year, ranked 34 in our World Economic Competitiveness Report, and, as interesting, an expected 70 million Facebook user by the end of the year. And we have similarly encouraging macroeconomic data in the entire region, a lot of achievements. But at the same time, we still have important questions to answer, such as, can we close faster the educational, the talent, the gender gap? How can companies and public institutions strengthen the ASEAN economic community? Can we build up fast enough infrastructure for the people? Can we leapfrog the health systems? What about the future of energy? A lot of questions due to a lot of transformations. But in the spirit of public-private cooperation, we can address all these challenges.  We have more than 700 participants today. And you all have one major thing in common. You're all leaders. Political leaders are our heads of state and government. We have 30 ministers. We have a lot of representatives of international institutions, organizations and NGOs. We have more than 500 business leaders from all the industries, including all the social entrepreneurs. We have leaders in academia, science, arts, 200 media leaders. And of course, we have also the next generation of leaders, the youth. And as leaders, you all know the three main pillars of leadership. First, you must have the courage to take decisions. Second, you must be competent to take the right decisions. And third, you must have the capability to motivate people to turn decisions into reality. And therefore, trust is decisive. Trust is key. Trust is critical. Trust is the glue which holds a society as well, a region together. Without trust, there is no motivation. Without motivation, there is no leadership. Without leadership, we will never overcome our challenges. But the good news today is that it's hard to imagine a more capable group than you to pose all these challenges to. You are leaders. You are trusted leaders. And we, as a World Economic Forum, as trusted partner in transformation, we would like to offer to you this summit as a platform for real public-private cooperation in order to create trust, in order to create leadership to lead East Asia into a better future. And finally, if we keep all the commitments, we will agree in this summit. Then one day, maybe in 10 years, someone else will welcome you, then to the 34th East Asia Summit. And he, or maybe much better, she will then tell her story, that she maybe was adopted from somewhere else in the world to East Asia, that she grew up in East Asia, that she went to school, went to university, could make her career in business, politics, or both. To put it in a nutshell, that she as well got the chance of her life here in East Asia. And of course, it's not on us to define her way of life or any way of life. But to create a peaceful and prosperous region that, ladies and gentlemen, that is the reason why we are here today. So again, a warm welcome to our East Asia Summit 2015. Thank you very much. And now it's my honor, my pleasure to ask the Deputy Prime Minister Vokovic to make some welcome remarks to the plenary. Thank you, Philippa. President of the Republic of Indonesia. Yagmulia Bapa, President of the Republic of Indonesia, excellent President of the Republic of Indonesia, esteemed colleagues, participants of the forum. I'm glad to be a guest for today's forum in Indonesia, and thank you so much for the opportunity to address you today. At present, Asia Pacific region and East Asia have become the main drivers of global economic growth, and will remain such drivers for the foresee in future. Now Asia Pacific region has got 60 percent of world GDP, and for about 45 percent of total volume of their entrance board investment. Economic growth of the countries of the regions sustainably exceeds 5 percent. This defines interests of Russia as well as of other big countries of the region to participate in the cooperation with Asia Pacific region. This interest is based on deep and good traditions of harmonical development and hardworking people of the region. Asia Pacific region is one of the key regions for cooperation with Russia, and ASEAN is one of our permanent countries. As a proverb says, there is no point in clapping by one hand. We are based that today Russia as well as Asian countries are solving common problems of increasing their GDP growth and increasing the quality of life of their peoples. During the latest time, the ties between Russia and Asian countries have increased greatly since the first summit. The volume of our bilateral trade has increased with more than 5 percent, till 21.5 billion dollars in 2014. The most interesting spheres of our cooperation are energy, transportation, agriculture, and we have good will to cooperate in these spheres. We see good perspectives to develop cooperation with our partners in ASEAN to supply liquefied gas using the North Sea route in the supplying of our aircraft helicopters and to develop other industries to create satellite systems and joint mechanisms of industrial development. We are ready to join the transportation systems including the usage of GLONASS systems and GPS. As an important vector of the economical politics of Russia is to join the processes in ASEAN countries and including the participation of our regions of Siberia and the Far East. We are ready to establish contacts between the Eurasian community with the future ASEAN community. We are talking about signing of the free trade agreement with Vietnam and we have a good cooperation here. We hope it will give good opportunities for the development of our further relations with the ASEAN countries. We do not have common borders with ASEAN but nevertheless we are talking about our interest to develop cooperation in quite a number of spheres including e-commerce. We are developing technologies for these. The results of the recent visits of the chairman of the government of the Russian Federation, Mr. Medvedev to Vietnam and Thailand, have once again confirmed similarity of our interests in ASEAN track, mutual desire for increasing multi-faceted cooperation first of all in such key spheres as I have mentioned already. Quite less active our relationship with Indonesia now. We have regular political dialogue between our presidents including on the sidelines of international forum. This gives a good opportunity to develop good cooperation between our countries. Just recently in November 2014, our president Vladimir Putin has met his excellent semester, Joe Covedo, the president of Indonesia and he intended to develop active ties with the Republic of Indonesia. My today's talks with colleagues here have shown the desire to work together. We would like to work together to counter challenges and threats in the world. Recently Russia have started several big projects in Indonesia including the project of building a railway and the alumni refinery and some other interesting projects. We also welcome investments from ASEAN countries to Russian economy and we are open for such kind of cooperation. One of the most interesting spheres of cooperation is agriculture but we also would like to work together in traditional spheres of cooperation such as mining and others. Seeing the cooperation with Singapore, for example, I would say that Singapore actively participated in modernization the airports in Sochi. We are ready to move towards widening of cooperation with ASEAN countries. To conclude I would like to underline that our partners in Southeast Asia are very reliable. They are very ready to work together despite of global politics and this is our common approach and that's why we came here. We are open to realize joint projects and we are ready to develop our cooperation in the spirit of friendship for the benefits of our people. Thank you so much. Thank you Deputy Prime Minister Dvokovic and I would like to ask the Deputy Prime Minister of Vietnam to announce all his speeches, his welcome remarks to the audience. Ex-Census Joko Widodo, President of the Republic of Indonesia, Ex-Census Samda Mohon Sen, Prime Minister of the Kingdom of Cambodia, Ex-Census leaders, ladies and gentlemen. It is my great pleasure to attend the 24th World Economic Forum on East Asia, organized in Jakarta, the capital of the beautiful and hospitable country of Indonesia. I would like to thank Ex-Census President Joko Widodo and the web for giving me the opportunity to address this prestigious forum to share with you some thoughts on cooperation to build a bright future for East Asia in the new global context. Ex-Census President, ladies and gentlemen. increasingly substantial cooperation and multidimensional and multilayered linkages have become the major trends in East Asia. The establishment of the ASEAN community by 2015 opens up a new era for development in East Asia. It can be said that East Asia more than ever before enjoying great opportunity for cooperation and development. However, this is all the time that East Asia is facing many challenges. Many economies in the regions are suffering from decline in growth rate, strategic competition, territorial disputes, environmental protection, climate change, navigations and overflight safety and security among others are challenging regional stability and development. Therefore, the theme, East Asia in the new global context of our opening ceremony today is totally relevant to the common interest of East Asian countries. This shows that after every crisis, Asian economies rise up more strongly with the firm determinations and reform efforts. That is the reason why many Asian countries are promoting structural reforms, enhancing governance capability, developing infrastructure, education, health, science and technology. This is the south path forward as domestic reform is a decisive factor to the formation of a more resilient economy in the new global context so that we can bring about the benefits of international integration to the people. And for Vietnam, we are exerting great efforts to complete the market economy, promote economic restructuring and transform growth model, to build the best business environment and build a more competitive economy going hand in hand with social justice and environmental friendly needs. East Asia's strong growth is not only for its own benefit but also to contribute significantly to resolving common issues of the whole world. Each individual will become stronger if he is shared and supported. Therefore, economic linkages among regions should be further deepened and vitalized. The establishment of the Asian community together with the cooperation mechanisms among region countries between Europe and Asia between the two Pacific Oceans banks will open up new opportunity and create new momentum for development for East Asia and its partners. Besides the responsible contribution to the Asian building, Vietnam has concluded FTA negotiations with the Republic of Korea and Customs Union of Russia, Belarus and Kazakhstan and is actively promoting the trans-Pacific partnership, TPP, as well as trying to conquer the regional comprehensive economic partnership. Any business that has the desire to expand investment in East Asia should not miss the business opportunity brought about by these agreements. Excellency President, ladies and gentlemen, finally, it is very important to bear in mind that integration and development in East Asia would only be secured when regional peace and stability are consolidated. Differences and disputes should be resolved through peaceful measures with respect to international law, along with sincerity and trust. Directly concerning our region, its development in the East Sea or dispute in the sea need to be solved through peaceful measures on the basis of the international law, including the 1982 United Nations Convention on the Law of the Sea. Cooperation, mutual respect and trust shared responsibility over common issues at indispensable factors to ensure the sustainable development of the entire region. Vietnam will stand side by side with other countries and partners in these endeavors. It is still a long and challenging way ahead. The future of East Asia depends on our ability, on the ways and means we respond to changes in the region and the world. I hope that waft on East Asia this year will put forward many initiatives and ideas on how to boost cooperation for sustainable development in East Asia in the new context. May I wish Excellencies President and all of you the best of health and success. Thank you. Thank you, Deputy Prime Minister. And now it's my honor to ask the Prime Minister of Cambodia to make his speech to our participants. Excellencies, Joko Widudu, President of the Republic of Indonesia. Excellencies, ladies and gentlemen, first of all, I would like to thank the organizers for inviting me and my colleagues to this 24th World Economic Forum on East Asia. I would like to congratulate and express a profound gratitude to the government people of the Republic of Indonesia, the host country for the excellent arrangement of this forum and for the warm hospitality extends to all the distinguished guests, including Cambodian delegation. Over the past years, East Asia region has been successful in maintaining peace, stability, vibrant economic growth and sustainable development that has enabled our region to play a vital role in driving and sustaining the world's economic recovery from recent global financial downturns. In addition, our regional integration has been progressing remarkably well and deeply rooted through important mechanisms such as especially the East Asia Summit with ASEAN being the centralities and the catalyst. However, in the context of rapidly changing global political, economic and financial architectures as characterized by steady rise of a multi-polar tendency, I am of the view that countries in the region have to adhere to their long-term vision and proactive approaches toward promoting and ensuring sustainable development. In this period, I would like to highlight some major tasks which should be part of our regional priority agenda. First, further promoting cooperation to ensure peace, security and firm stability to trust-building measures and consultation, including resolution of regional issues by peaceful means and in accordance with the principle of international law. Second, exerting efforts to ensure a balanced, sustainable and inclusive economic growth through implementation of prudent macroeconomic and financial policies and in-depth structural reforms while paying attention to human resource development in order to strengthen the resiliency of economic and financial systems and enhance regional competitiveness for both investment attraction and social equities. Third, further promoting deeper regional integration in all sectors, especially through improved connectivity in all aspects such as physical, institutional and people-to-people connectivity. One of the major priorities is to accelerate the conclusion of a regional comprehensive economic partnership that will be accounting for about half of the world's population and almost 30 percent of the global economy. It is certain that by the end of 2015, Asian economic communities will become a major market that provides numerous opportunities for businesses and investment in every sector. However, the conclusions of a wider regional trade agreement will create even greater investment opportunities as well as further promoting economic and trade activities. Allow me to elaborate a bit in addition to what the two-seat action that there should not be a confrontation but should be complement each other. It's on the point that we have two mechanisms today that is now operational. One is Trans-Pacific, that includes America and a number of countries plus some of Asian countries. And another mechanism is a comprehensive economic partnership with sign in Penongping in the year 2012 during the time Cambodia chair as in then it includes 10 Asian countries plus some countries like India, Japan, China, South Korea, Australia, New Zealand. So these two mechanisms should not become a confrontation but complementary. What we should review again is that why Trans-Pacific did not include the 10 Asians as partners? That's the point. It's a serious question myself. What is the real purpose, real intention of establishing a Trans-Pacific has any real goal that they include half of Asian to be partners of Trans-Pacific and leaving half of Asian outside? That's the point. I would like the World Economic Forum on East Asia to provide consideration and debate. As a member of G20, pay attention to that too. Posting such a question, there are 10 Asian countries. Why they include only half? Post a question in this World Economic Forum of East Asia. Fourth, we are still facing with common and universal challenges including the economic and financial crisis, food and energy security, climate change, natural disasters, terrorism and cross-border crimes. These challenges cannot be solved at the country level but it requires closer collaboration with deeper and comprehensive approaches, both at the regional and global levels. Thus, enhancing the effectiveness of a regional cooperation to effectively and timely response to those challenges is one of our utmost priorities for now and for the medium to the long term. Excellencies, ladies and gentlemen, in an effort to cope with the rapidly changing global environment and as our country is located in this dynamic region, the government of Cambodia is firmly committed to seize every opportunity and make the best use of them for sustainable development. Being a responsible member in this regional grouping, Cambodia stands ready to join hands with all stakeholders and make necessary efforts in coping with our challenges and ensuring long lasting peace, stability and possibilities for the whole region and finally, may I wish the forum great success. Thank you. Thank you Prime Minister of Cambodia and now ladies and gentlemen, I'm happy to introduce to you the President of our host state, the President of Indonesia, Papa, President Jokowi, the floor is yours. Your Excellencies, our CEO, ladies and gentlemen, welcome to Jakarta, welcome to Indonesia. I'm pleased that you are here this week, historic week because we are also hosting the 60th anniversary of the Asia-Africa Conference in Bandung. We are here this week to talk, to talk but more importantly to listen. I have asked my ministers to be very honest about our challenges. I have asked my ministers to listen. But I hope that after spending this week in Jakarta, you will also see our amazing opportunities. Please come and invest in Indonesia. If you have any problem, call me. Ladies and gentlemen, the world is in a fundamental transition. For us in Indonesia and for all emerging market, the condition is suddenly very challenging. But where we see challenges, I see opportunity. In fact, our challenges are your opportunities. Your Excellencies, ladies and gentlemen, I have just returned from an official visit to Tokyo and Beijing. And after many meetings with Presidency Jinping and Prime Minister Sinsu Abe, I would like to share with you. I am extremely optimistic. I believe China and Japan today enjoy the best leadership they have had in a generation. And I believe this is to the great benefit of Asia as a whole. If there is one thing that Prime Minister Abe, Presidency, and I can agree on, it is that the world is changing very fast. China is changing. Japan is changing. And Indonesia is changing. I believe Indonesia has to change. Why do I believe Indonesia has to change? Because my people tell me, my people tell me, that our country has to change. Every week and every month, I go into the villages. I go into the cities. And my people ask me, Mr. Jokowi, please change our country. Within this global transition, our task is clear. We have to reinvent our economies. We have to reinvent our societies. Let me share with you a story. We have been here before in the 1970s. Indonesia became rich on export of crude oil. Crude oil was booming. Oil prices hit a record high. At the time, Indonesia was the only member of OPEC from Asia. Our energy minister, Subroto, was Secretary General OPEC. Then in 1980, the price crude oil crashed. By then, oil and gas exports were 80% of our total exports. We were forced to devalue our currency. We had an economic crisis. But with crisis came opportunity. Again, with crisis came opportunity. After the 1980 oil prices crashed, Indonesia began to industrialize. Over the next 15 years, we built up textile and garment industry, furniture industry, pulp and paper industry, palm oil industries, chemical industries. By 1995, oil and gas exports were only 30% of our total exports. Exports of goods and services were 70%. Today, we are in the same situation. Commodity prices have crashed. Our currency has been hit. This is causing a lot of pain for a lot of people. But let me tell you, we have done it before. And we shall do it again. Our commodity reaches made us over consumptive. We neglected our human resources. Our currency in Darupiah has been shaken. Today, we must save from consumption to back to production, from consumption to investment. Investment in our infrastructure. Investment in our industry. But most importantly, investment in our human capital. The most precious resource of the 21st century, change can be painful. Change will create winners and losers. But there can be no progress without change. There can be no gain without pain. Even with the pain, my people tell me every week and every month, please, Mr. Jokowi, change our country. Our people are very wise. They recognize that to have progress, there must be sacrifice. Fortunately, history is on our side. I would even say God is on our side. After the 1997 Asian financial crisis, a lot of people around the world asked, will Indonesia survive today, almost 20 years later? We are a vibrant and stable democracy. Our unity in diversity, what we call Bineka Tunggal Ika, is stronger than ever. We have become the fifth largest economy in Asia. And a key member of the G20. The Indonesia people are wise. They are resourceful. And therefore, I'm here to tell you, with 100% confidence, Indonesia will prevail. Again, 100% confident, Indonesia will prevail. When you spend time with Indonesia, especially on Facebook and Twitter, you will find our people have incredible humor. Our people have incredible courage. Our people have incredible wisdom. Therefore, ladies and gentlemen, I stand here today to invite you to join me and my people on an incredible journey, on an incredible adventure, and to make incredible profits. If you have any problem, call me. Thank you. Thank you.