Deleveraging global debt went from 1x global GDP in 1990 to 11x in 2007

1. Consulting - Rotary Club Dumaguete SouthSept. 1 2010 Recap – Macro-economyMarch 18 2009 Meeting Deleveraging • global debt went from 1x global GDP in 1990 to 11x in 2007 • Decoupling • for the first time in history emerging markets haven‘t evolved in sync with the Western world and have continued to grow handsomely. • growth in BRIC regions spurs growth in neighboring countries. • Deflation • is a ‚killer‘ for consumption and investment. • banks tend to hoard, i.e. not doing what they‘re supposed to do: financing • large companies used their monies to improve B.S.s and share buybacks • is more difficult to manage than inflation.

2. Recap -Investment Recommendations - March 18 2009 A. Buy into Chinese Infrastructure development - Long on Iron Ore as a proxy China Ore Index Source: Bloomberg B. Buy Asian Banks or Hedge by Shorting Western Banks HSF Index vs. Dow Jones European Financials Index Source: Bloomberg

3. Economic Situation Today De-leveraging is mainly a Western concern • Global debt now 10x GDP? • In the US, overall national income has declined by USD 52bn since the Lehman Brothers bankruptcy in 3Q 2008, while companies’ net income has risen by USD 216bn. • Never before have the fruits of economic activity been so skewed in favour of companies and at the expense of other constituents. US profit share of national income Current profit cycle vs. previous experience

4. Economic Situation Today (cont‘d) Decoupling is working its Wonders • The Philippines to benefit from growth in China, India and neighbouring regions Asia-Pacific sector performance Source: Nomura • 5.9% to 6.9% GDP growth in 2nd quarter • Mainly due to FDIs: foreign countries investing in the Philippines • Agriculture in regression and tourism to suffer Deflation is not an issue here • In fact national banks have an unprecedented level of liquidity • Project financing available in PHP • If things are done correctly interest rates will continue to come down

5. Torrex Consulting - Rotary Club Dumaguete South,1st ofSept.2010 Economic Situation Today (cont‘d) Valuations: P/E Ratios (12 month forward) Double Dip? Source: Nomura Valuations: EV/Ebitda (12 month forward) Source: Nomura If the global economy is to avoid a double dip, national income will have to be spread more evenly than it currently is, and companies will have to reduce their current high propensity to save.

6. Torrex Consulting - Rotary Club Dumaguete South,1st ofSept.2010 The Philippines‘ Situation Relative To Others Life Expectancy Can Be Improved Very Poor Income Growth Gross Capital Formation Electricity of a 3rd World Country Natural Ressource Devastation Inequality Index Source: Gapminder

7. Torrex Consulting - Rotary Club Dumaguete South,1st ofSept.2010 Agriculture: Philippines won‘t benefit fully • Ever increasing demand for agricultural products but: • Agriculture‘s regression in Q2 blamed on ‚El Niño’ • The fragmentation of land cannot support economies of scale • Buyers of agricultural produce will be better off • Buyers, such as sugar mills, see their power increased • Consolidation likely to occur late • In Russia it took 15 years. Zimbabwe? • Selected opportunities • Azuki Beans:with 25% protein content it‘s one of the most nutritive vegetables, more digestible than European beans, favorite vegetable in Japan after soya beans and its paste (‚anko‘) ingredient to most Japanese sweets • Coffee:200 years ago the Philippines was the fourth largest coffee producing nation. Today it produces only 0.012% of the world's supply. • Milk:important for children‘s nutrition and the production of dairy products, would lessen dependency on imports

8. TorrexConsulting - Rotary Club Dumaguete South,1st ofSept.2010 Tourism: What Kind? Look at What Resources We Have Which Segments? Eco-, adventure, student, senior and medical tourisms Shopping: Small to medium enterprises in handicraft niches. Selected light industry ventures. In a sustainable way Peers: Costa Rica, Bhutan, Tanzania, Tahiti and Seychelles Nature: Among the Best Coral Reefs and Marine Fauna in the World, Proximity to other interesting islands • For Which Markets? • Start thinking about China, India and Japan‘s demands • While servicing and promoting Western clientele Source: Suakrem Cultural: Rich Native, Chinese, Spanish and American influences on society. Human: being thePhilippines‘ Student City, having Nice People, exporter Lack of urbanization:Turning a Weakness into an Opportunity • How? • An Integrated Approach is Needed

9. How to Obtain this Kind of Tourism? Integrated Approach to Planning 1. Easy Access from Major Tourist Market Sources (intl. or domestic), one the most basic of all planning considerations, transfers must be kept to a minimum and effected as conventiently as possible. 2. Within the Regional and National Context • 3. Site Selection • Sites must be determined according to a number of criteria, including: • Suitability for the type of resort planned • Distance from the potential tourist attractions • Availability of land not required for more important uses or of high conservation value • Easy Accessibility • Availability or feasibility of developing an adequate infrastructure • Availability of the amount of land • Feasibility of acquiring it • Undeveloped sites are preferable

10. TorrexConsulting - Rotary Club Dumaguete South,1st ofSept.2010 How to Obtain this Kind of Tourism?(cont‘d.) Integrated Approach to Planning(cont‘d.) • 4. Transportation Network • Resort and area must be bcarefully planned with respect to land use and circulation patterns • An efficient internal tranportation system is important, incorporating publc transport and footpaths, • Planning related to environmental, market & economic analysis and socio-cultural considerations (where relevant) • One the most basic of all planning considerations • Transfers must be kept to a minimum and effected as conventiently as possible • Public access should be incorporated into the resort plan • In areas of existing settlements, there should be local community participation in the planning process • Resort planning is a specialized field and experienced professionals should be employed to carry out the planning and related market and economic feasibility studies • 5. Feasibility Studies • Careful and realistic market and feasibility studies must be conducted to ensure that the proposed resort will be economicaly viable, and to help determine the size and type of resort to be planned • Resort plan should be avaluated for its economic, environmental and socio-cultural impacts • Impact evaluation should consider both the immediate resort site and its regional context • If negative impacts are unacceptable, the plan compect must be revised

11. TorrexConsulting - Rotary Club Dumaguete South,1st ofSept.2010 How to Obtain this Kind of Tourism?(cont‘d.) Integrated Approach to Planning(cont‘d.) • 6. Planning for Future Demand Growth • Resort planning should allow for flexibility of development, especially during the later stages of implementation • The basic concept of the resort and the integrity of its plan should be maintained • For larger resorts that are expected to be developed over a long period of time, the plan should be configured so that it can be efficiently managed and convenient for tourists to use before the later stages of development • 7. Utilities in Place • Adequate Water Supply, Electric Power, Sewage and solid waste disposal and telecommunications • Should be Designed to International Standards • Should be planned along the with the land use planning • Where needed, the resort infrastructure should also be developed to serve local communities and thereby upgrade them • 8. Development and Design Standards • Distance from the potential tourist attractions • Availability of land not required for more important uses or of high conservation value • Easy Accessibility • Availability or feasibility of developing an adequate infrastructure • Availability of the amount of land • Feasibility of acquiring it • Undeveloped sites are preferable

12. TorrexConsulting - Rotary Club Dumaguete South,1st ofSept.2010 How to Obtain this Kind of Tourism?(cont‘d.) Integrated Approach to Planning(cont‘d.) • 9. Leisure Facilities • A variety of recreation, cultural and leisure facilities as wel as sightseeing/activity related attractions should be incorporated into the resort plan and into the tourism planning of the region • 10. Employee Housing • Resort planning should consider relationships to any nearby communities • Provision of housing and community services for employees • New communities may need to be planned for resort employees and their families • In other places, planning will be required for existing communities to absorb employees

13. Investing in Infrastructure is the Way to Go Thailand vs. Philippines Bury, Burn or Recycle?

14. TorrexConsulting - Rotary Club Dumaguete South,1st ofSept.2010 Investing in Infrastructure is the Way to Go (cont‘d.) It‘s in the Press

15. TorrexConsulting - Rotary Club Dumaguete South,1st ofSept.2010 Investing in Infrastructure is the Way to Go (cont‘d.) Philippine Banks in Good Shape Outlook on Philippine Banks by Moody’s upgraded to “Stable” in January 2010 • Better economic prospects and stabilizing global conditions • • Improved access to international debt and money markets, and • • Adequate resiliency of banks to cope with remaining macro and micro‐economic risks. Low Domestic Interest Rates

16. TorrexConsulting - Rotary Club Dumaguete South,1st ofSept.2010 Investing in Infrastructure is the Way to Go (cont‘d.) Overview of the Philippine Financial Markets 1980‘s – short term, floating rate, CP Total private sector debt issues • Reverse capital flight • Frenzy of M&A activity • Absence of the dominant foreign banks • The inaccessibility of the foreign debt markets to local issuers Taking a First Step Clean Up the World Week • 17-19 September 17-19 • Worldwide movement for positive change and communication • Children (8-12 years old?) cleaning up our mess can be a fun ‚activity‘ for them • Elevate the moral cost of parents littering • Be an example for rest of society

17. TorrexConsulting - Rotary Club Dumaguete South,1st ofSept.2010 Who is Torrex? Our Mission To consciously invest in sound sustainable opportunities that are supported by strong fundamentals. We want to promote wealth and welfare through an optimal use of resources. Our projects must deliver profitable growth in areas that either help to reduce negative- or create positive externalities. The sectors that interest us We help our Clients achieve their objectives in areas of renewable energies, recycling, tourism and healthcare services. Key People • Humberto Ramil • Claudine Esseiva • María del Pilar Moya • Daniel Schwenzer • Stefan Waldburger • Specialists working on a goodwill basis www.torrexconsulting.ch