Chapter 1How Does Economy Grow?

“Society is composed of two great Classes:

Those who have more dinners than appetite,

And those who have more appetite than dinners.”

Sebastian R.N. Champfort

Theories That Explain How Economies Grow

• Theories viewing economic growth as a natural and inevitable.

• Theories explains economic growth development as rational.

• Theories views economic development as a result of economically irrational.

General Explanation Of Economic Development

Economic development proceeds according to a master plan or “Law of Nature.”

In 1932..

Spengler – Explained economic development as a culture or society to a living organisms that grows lives and dies.Economic development is a natural thing that

happens to an existing culture.Herbert Spencer - viewed society as an organism constantly in a process of evolution.

Economic development is brought about by an “Invisible Hand.”

In the 18th Century..

Adam Smith - advanced the principle of the “Invisible Hand” as underlying economic development. While individuals seek to work for their own

personal goals, they unknowingly promote what is best for all.

Any society including a very underdeveloped one can to prosper with little or no intervention from government because economic development is brought about as a natural course of things.

Economic development is brought about by “Cultural Diffusion.”

Anthropologists – introduced the idea that societies have been involved in different social or culture “experiments” in various economic, political, religious or social aspects of life. Societies are fortunate enough to stumble on a

“breakthrough;” a “lucky” combination of interests, leaders, people, events, methods that leads to economic or other development in society.

Example of breakthrough is the evolution of machines.Some theories classify economies as traditional (less developed/backward) or modern (market/capitalistic/developed).

Racial heritage determines the economic development of a people.

Belief that one race is superior to another on the basis of color, build and other genetic heritage has been around for a long time.

Hitler – contend that racial characteristics make some people more energetic and allowing their countries to be far more developed than other. Belief in “Aryan superiority” as justification

for conquest during world war 2.

Climatic conditions determine the energy level of a people and the rate of development.

In 1951..

Ellsworth Huntington (American geographer) – wrote the most of the great civilization flourished in the tropics or the far north.Observation and studies led to conclude that

extremes of temperature of climatic conditions have a detrimental effect on the energy level of people.

The challenge of the natural environment is responsible for the rise of civilization.

In 1947..

Theory advanced by A.J Toynbee in his book a Study of History.Traces economic and cultural change a

combination of natural phenomena and socio-psychological pressure of stimuli such as new soils to exploit.

The “challenge of environment” is responsible for the rise of civilization.

Economic explanation for development.Early 19th century..Industrial Revolution – economists such as Adam Smith, David Ricardo, and Karl Marx identified various economic factors influencing economic growth.Example: capital accumulation, population changes, division of labor, and entrepreneurship.

Technology improvements and division of labor lead to development.

Adam Smith – believed that the invention of better machines and equipment brought to increased productivity together with the division of labor.

Division of labor in Smith view’s.• An increase of skills among workers.• Reduced time necessary to produce

commodities.• The invention of better machines and equipment.

Population changes affect development.According to David Ricardo – population increases eventually lead to stagnation or a final stationary state of economy. Sustained increases in population would lead to more and

more demand for food. He argued that the time will come when land becomes less

productive, and requires higher product costs in order to continue producing.

John Maynard Keynes(1936) – disagreed with Ricardo’s conclusion on the effect of population increase on economic growth. Maintained that capitalists or entrepreneurs are most likely to

invest their resources when there is a demand for commodity. Increasing demand and increasing population, capitalists invest more.

Socio-psychological explanation of development.Sociologists and psychologists differ from economists in explaining economic growth.Joseph Schumpeter(writing in 1921) – observed that economic development progressed and in sudden leaps, initiated by men who wanted to “promote new goods and new market.”

Sociological factors in economic development.Max Weber(1904) – attributed the high degrees of economic development in the west.Talcott Parsons – used by sociologists to describe the change in values held by cultures as they evolve from traditional to modern economies.

According to Parsons, individuals in modern societies are:

• Unemotional• Interested in Themselves• Able to relate to others in terms of their social

roles• Known for their

accomplishments(achievements)• Able to relate to others in specific economic

terms.

In Contrast..

• Be emotional• Be more interested in general welfare of the

community• Relate to others in terms of their unique

qualities• Be known for who they are• Tie up economic relationships

Psychological factors in economic development. Psychologist view economic growth as a

product of individual human behavior. Person’s decisions Thoughts and actions.In 1961..David McClelland- concluded that among the many human motives, the achievement motive does the most in predisposing individuals to vigorous economic activity.

THE GENERAL THEORIES

• The “Invisible Hand” principle

• Cultural Diffusion

• Racial Heritage

• Climate

• Challenge of the Environment

• The “Invisible Hand” principle -> the invisible hand of the market is a

metaphor conceived by Adam Smith to describe the self-regulating behavior of the marketplace.

Cultural Diffusion ->mean as the ideas and things in one

culture “borrowed” by another culture cultural diffusion.

• Racial Heritage ->was proposed by Adolph Hitler, He

thought that there was a race that was superior to the others . This was determined

by factors such as skin, color, body type, weight and other genetically determined factors.

• Climate ->is usually defined as the "average

weather,“

Challenge of the Environment ex. Flash flooding is a real threat to peoples

lives and has devastating impact on business, homes and communities

Economic theory -> a theory of commercial activities such as

production and consumption of goods.

Socio-psychological Theories -> is the scientific study of how people's

thoughts, feelings, and behaviors are influenced by the actual, imagined, or implied presence of others.

Entrepreneurship and Economic Growth ->is a process of identifying and

starting a business and organizing the required resources and taking both the risk.

Chapter 2

The role of entrepreneurship in

economic Development

Innovation

• This refer to new or different ways of doing things, like technology, marketing, human relations, management, and so forth.

• When an individual creates a new product, it is innovation. When he sells his product in different approach, it is also innovation.

Entrepreneur Defined• Prof. Nathaniel left, is the capacity for

innovation, investment and expansion in new markets, products and techniques.

• Prof. Hirsh said that “Entrepreneurship is more than a word. It is a mission. We must perceive opportunities inherent in change; we must create a desire for pursuing the opportunities that arise; and we must create an environment in which success is possible and the consequences of failure are tolerable.”

Economic Development & Growth explained

• Development is a process while growth is product. So growth is the result of development.

Economic Development

• Refers to a progressive process of improving human conditions by eliminating or reducing poverty, unemployment, disease, illiteracy, injustice and exploitation.

Development and Growth Theories

Laissez Faire theory – These are French words introduced by the Physiocrats to mean economic freedom. This theory explains that the government should not interfere in economic activities. It is Free-enterprise economy.

• Keynesian Theory – the government should play the key role in economic development, particularly in less developed countries, or those depressed economic conditions

• Ricardian Theory – This theory of David Ricardo, an English classical economist. He believes that the key factor in economic growth is land

• Harrod-Domar Theory – This was conceptualized by Sir Harrod of England and Prof. Domar of US. The key factor in economic growth is physical capital like machines.

• Kaldor Theory – Nicholas Kaldor maintains that the key factor is technology. This explains that the applications of modern technology in productions of goods and services has been responsible for the economic success of highly developed countries like the United State.

• Innovation Theory – This was developed by Joseph Schumpeter. He stresses the role of innovators or entrepreneurs in economic development. He says that it is the innovator who has courage and imagination to handle old system, and be able to transform theory into reality.

• Non-Economic Theories – These are several other theories which are non-economic in nature.

Key Factors:Political stabilityEfficient Public administrationOpen societyPositive cultural values

The importance of Entrepreneurship

Statistics in both rich and poor countries show that small enterprises are leading in the generation of jobs and wealth.

In Philippines, most of our economic activities fall under the micro and small business categories. There are many retailers, vendors, and other small sole proprietors.

Contributions of Entrepreneurs

Develop new markets – Under the modern concept of marketing, markets are people who are willing and able to satisfy their needs. In economic, this is called Effective Demand.

Entrepreneurs are resourceful and creative. They can create customer or buyers. This makes entrepreneurs different from ordinary businessmen who only perform traditional functions of management like planning, organization and coordination.

Discover new sources of materials – Entrepreneurs are never satisfied with traditional or existing sources of materials. Due to their innovative nature, they persist on discovering new sources of materials to improve their enterprises.

Mobilize capital resources – Entrepreneurs are the organizers and coordinators of the major factors of production, such as land, labor and capital.

Introduce new technologies, new industries and new products – Aside from being innovators and reasonable risk-takers, entrepreneur take advantage of business opportunities, and transform it into profits.

Create Employment – The biggest employer is the private business sector.

Participation of WomenWomen constitute a big portion of total population.

Their exclusion from productive enterprises is a great economic loss. They should be producers and not merely consumers.

The business potentials of women have gained the attention of some United Nations agencies and other non-governmental organizations (NGOs). As a result, there are now programs/projects for women, especially in the rural areas of poor countries, which are envisioned to train women for business enterprises and livelihood endeavors.

Filipino Entrepreneurial Economy

• There is a need for a Filipino entrepreneurial economy. This means our productive resources should be in the hands of Filipinos for their own benefits. A reasonable economic nationalism should dominate our business culture for our own prosperity as a nation.

• Claro M. Recto - considered the Father of modern Filipino nationalism .

- He defined economic nationalism as the control of the economic resources for their own benefit and enjoyment.

Social and Economic Impact ofEntrepreneurship

Entrepreneurship creates employment.

• The existence of business activities influences employment. Business estab lishments need people to work for them.

Entrepreneurship improves the quality of life

• People need to work in order to survive, attend to their needs, and satisfy their wants.

Entrepreneurship contributes to more equitable contribution of income and therefore eases social unrest

• With more entrepreneurial activities provided to the people in the country sides, natives have more work opportunities thus, discouraging them from resett ling in other places.

Entrepreneurship utilizes and mobilizes resources to make the country productive

• We may use our own natural resources, and process and convert them to more useful things.

Entrepreneurship brings social benefits through the government• The resources collected by the

government are given back to the people in the form of services, infrastructure projects, school buildings, and maintenance of peace and order

Per Capita Income• Per capita income: total resources/total population.• Per capita income is often used as average income, a

measure of the wealth of the population of a nation, particularly in comparison to other nations. Per capita income is often used to measure a country's standard of living. It is usually expressed in terms of a commonly used international currency such as the Euro or United States dollar, and is useful because it is widely known, easily calculated from readily-available GDP and population estimates, and produces a useful statistic for comparison of wealth between sovereign territories. This helps the country to know their development status.

“Government Programs for Entrepreneurs”

• Government and Non governmental or organization, as well as foreign offer financial and technical assistance to micro and small entrepreneurs, particularly for those in the rural communities.

• these materials are not useful to student but also to other who are interested in setting up their micro or small business.

• the following reprints are: “Magna Carta for small enterprises• “,”kalakalan 20”,”Micro-Enterprises Development

Programs”,• “Self-Employment Loan Assistance Program”, and “Training

Programs for small and medium Enterprises”

Primer: Magna Carta for Small Enterprises

1.What is R.A 6977 otherwise known as the Magna Carta for Small Enterprises?

-R.A 6977 signed on Jan.24,is act to promote, develop and assistant small and Medium Enterprise (SMEs) through the creation of a small and medium enterprise development (SMED) Council , the establishment of a small business guarantee and finance corporation (SBGHFC) the mandatory allocation of credit resources to small enterprises and the rationalization of government assistance programs and agencies concerned with the development of SMEs.

2.Who will be benefit from the magna carta for small enterprises?

-Small and Medium enterprises will benefit from magna carta for small enterprises.

3. What is Small and Medium Enterprises?

-A small and Medium enterprise is defined as any business activity or enterprise engaged in industry, agribusiness and/or services, plant and equipment are situated, must have value falling under the ff. categories:Micro: less than- P 50,000Cottage: P 50,001- P 500,000Small: P 500,001- P 5,000,000Medium: P5,000,001-P 20,000,000

4. What is Small and Medium Enterprises development council?

- The council shall be the primary agency responsible for the promotion, growth and development of SMEs in the country ,including assisting relevant agencies in the tapping of local and foreign funds for SME development as well as promoting

5. Who are the members of the SMED council?-the council is headed by SMED as chairman. the members are the ff: a. Director General of the National Economic and Development Authorityb. Secretary of Agriculturec. Secretary of Labor and Employment d. Secretary of Environmental and Natural Resourcese. Secretary of Science and Technologyf. Chairman of Small Business Guarantee and Finance Corporation g. Chairman of small and medium enterprises promotion body which the president shall undertake to establish under this Act.h. Three representative from the private sector, all Filipino citizens, to represent luzon , Visayas and Mindanao to be appointed by the president one of whom shall come from the banking industry.

6. What are the power and functions of the SMED Council?- The small and medium enterprise development council

shall have, among others the ff. powers, duties and functions:

a. To recommend to the president and the congress and policy matters affecting small and medium scale enterprises;b. To coordinate and integrate various government and private sector activities relating to small and medium enterprise developmentc. To monitor and determine the progress of various geared towards the development of the sector.d. To provide the appropriate policy and coordinate frame work in assisting relevant government agencies , in the tapping of local and foreign funds for small and medium enterprise.e. To promote the productivity and viability of small and medium enterprise, regional ad provincial towards the:

1. Provision of business training course, technical training for technicians and skilled laborers and continuing skills upgrading programs.

2. Provision of labor-management guidance's , assistance and improvement of the working conditions of employees in small and medium-sized firms;

3. Provision of guidance and assistance and assistance regarding product quality/product development and product diversification;

4. Provision of guidance and assistance for the adoption of improved production technologies and commercialization of appropriate technologies for the product development and for increased utilization of indigenous raw materials;

5. Provision of assistance in marketing and distribution of products of small and medium scale enterprises;

6. Intensification of assistance and guidance to enable greater access to credit through a simplified multi-agency financing program;

7. Provision of concessional interest rest, lower financing fees, which may include incentives for prompt credit payments, arrangements tying amortizations to business cash flows, effective substitution of government guarantee cover on loans for the borrowers lack of collateral;

8. Provision of bankruptcy preventive measures through the setting up of a mutual relief system for distressed enterprises and the establishment of measures such as insurance against extraordinary disasters;

9. Intensification of information dissemination campaigns and entrepreneurship education activities.

10. Easier access to and availment of tax credits and other tax and duty incentives as provided by the omnibus investment code and other laws;

11. Provision of support for product experiment and research and development activities as well as access to information on commercialized technologies.

f. To assist in the establishment of modern industrial estates outside urban centers.

7. What is the small Business Guarantee and Finance Corporation (SBGFC)?- It is a corporation body created to provide, Promote,

develop and widen in both scope and service reach, various alternative modes of financing for small enterprises, including but not limited to:

- -direct and indirect project lending- -venture capital- -financial leasing- -secondary mortgage and/or rediscounting of loan papers

to small business.- -secondary/regional stock markets

8. What loans can be guaranteed by the SBGFC?-the Corporation shall guarantee loans obtained by the following under such terms and conditions adopted by its board.• qualified small enterprises• local and/or regional associations of small enterprises and

industries -private voluntary organization and/or cooperatives.

9. What are the guarantee schemes that may be provided by the SBGFC? -the SBGFC may guarantee loans up to one hundred percent (100%)-it may also provide second level guarantee (i.e, re insurance) on the credit and/or investment guarantee made by credit guarantee associations and other institution in support of small entrepreneurs.

10. What does the provision on the “Mandatory Allocation of Credit Resources to Small Enterprises” provide for?a.Section 13 of R.A 6977 provides that all lending institutions whether, public or private , shall set aside a portion of their total loan portion based on their consolidate statement of condition/balance sheet as of the end of the previous quarter and make it available for small enterprises credit.b.The purchase of government notes, securities and other negotiable instruments with the exception of such instruments as may be offered by the SBGFC shall not be deemed compliance with the foregoing provision.

“Small-Medium Enterprises Skills Training”• Focuses on the development and training of existing and/or

would be small and medium business entrepreneurs• Program provides continuing training of existing entrepreneurs• Aims to provide a forum for exchange of experience among small

and medium entrepreneurs and business expert/consultants from both the private and government sectors.

Types of SME skills training:• Meat Processing • Fish Processing• Peanut Processing• Wine and Vinegar Processing• Skills Upgrading on Shellcraft• Skills Upgrading on Ceramics• Skills Upgrading on Pottery• Skills Upgrading on Banacbac Handicraft• Skills Upgrading on Coco-midribs Handicraft

“Small-Medium Enterprises Management Training”• Focuses on the development and training of existing

and/or would be small and medium entrepreneurs.• This program provide continuing training of existing

entrepreneurs in upgrading and enhancing their business management skills.

• Aims to assist potential small and medium entrepreneurs in starting their own business

• Provides a forum for exchange of experience among small and medium entrepreneurs and business experts /consultants from both the private and government sectors.

• Chalk Making• Bamboo Furniture Training• Duck Raising and Hatchery• Speed Sewing• Salt and tile Making• Basic Carpentry Training• Skills Training on Rope making • Bamboo craft (Basketry)• Embroidery• Soft broom making• Stuffed toy training• Sawali making• Loom Weaving• Clay Hollow block making• Seagrass basketry• Rattan basketry• Christmas décor making• Fruit Processing• Candle making]• Banana Processing

Types of SME Management Training:

• Simplified Bookkeeping

• Financial Management• Business Management• Marketing Management• Product Management• Product Planning and Development• Furniture Business Development• Strategic Marketing• Product Costing and Pricing• Basic of Exporting• Consumer Education• Productivity Quality Improvement• Improve Your Business Training• Symposium on Livelihood Projects• Starting a Small Business• Subcontracting with Exporters• Organizing a Corporation

• Value Formation Seminar• Teambuilding• Store Design /Merchandizing• Effective Time Management• Leadership Training for farmer leaders• Management Extension and Consultancy• Advertising and Promotion• How to get started in exports• How to negotiate with buyers• Exports management• Entrepreneurship development Seminar• Seminar on bookkeeping and accounting• Seminar on Management and Simple Bookkeeping• Cooperative Management and Simple Bookkeeping

Micro-Enterprise Development Program

• Program Rational Poverty incidence continues to plagues a high percentage of our population. The first 3 years of the Aquino Administration has resulted in an encouraging reduction in poverty incidence.

Program Objective• To increase income and improve living conditions in

low income municipalities,thru:• -Provision of financial assistance for livelihood projects

in low income municipalities.• -Development of capabilities in livelihood program

implementation in low income municipalities.• Program Components• Financial Assistance (Loan)• -For working capital equipment and other requirements of

livelihood projects.• Technical Assistance (Grant)• -For community org. Institutional, strengthening, training,

etc.

Program Assistance Flow

• Program allocates P1,000,000 per identified low income municipality.• Program lends to community based organization borrowers:• -Maximum of P250,000 per organization borrowers:• -7% interest rate per annum• -Collateral free• -Repayable within 3 years• 3. Organization borrowers relent to individual entrepreneurs:• - maximum of P25,000 per microentrepreneur• -maximum of 15% interest rate per annum• -preferably collateral-free

Eligibility of Organization Borrowers• Its governing body or board has representatives from religious, business/banking, parent-

teacher groups and 2 other community leaders.• Such governing body or board preferably has members who are bonafide residents of the

municipality where the organization borrower is based.• Registered with SEC, CDA, DOLE or other appropriate agency• Has been endorsed by Congressmen concerned.

Eligibility of Microentrepreneur-Borrowers

• Should be bona-fide residents of low income municipality and presently engaged or will engaged in a livelihood activity in any of the ff:

• Handicraft/Cottage Industries• Post harvest Facilities• Fish Production/Processing• Food Production/Processing• Livestock or Poultry Production/Processing• Trading/Wholesaling• Services• Other Manufacturing Activities• Other Agricultural Production/Processing

Loan Application Procedures

• Applicant organization fills up a 3-page form available at any DTI Provincial Office.

• DTI Provincial Office initially evaluates application and endorses it to the MEDP-CDF Management Committee (MC)

• MEDP-CDF MC evaluates application and endorses it to the Congressmen concerned.

Self-Employment-Loan Assistance Program

Program Rationale• The rural poor is in need of a financing facility for gainful

entrepreneurial activities.• DTI recognizes that NGOs are effective intermediaries for credit, skills

and organizational assistance to low income groups in the rural areas.• • Program Objectives• - Provision of credit for micro entrepreneurs • - creation of employment and enhancement of income in the rural

areas.• - Development and strengthening of NGOs capabilities for

livelihood projects.

Program Components

• Credit for NGOs for on beneficiaries for microenterprises and livelihood projects.

• NGO STRENGTHENING through systematic assessment of needs, provision of training in livelihood project management, market development and other related activities.

NGO Borrowers Qualification Criteria

• Legal identity• One year track record in implementing a livelihood/income generating• Adequate staff/logistical complement• Minimum networth P100,000• Proponent counterpart of 15% of total project cost

Use of NGO Loans

• Re-lending to individual micro entrepreneurs engaged in either manufacturing, agro-processing, trade, transport and service business.

• Re-lending to self-help groups engaged in a manufacturing, agro-processing, trade, transport and services business

Department Administrative Order No.2

Series of 1990

Guidelines Implementing R.A 6810Otherwise Known As”KALAKALAN 20”

Pursuant to Sec.10 of R.A 6810, otherwise known as Kalakalan 20, and after consultation with the Departments of Finance, Labor and Employment, and Health and the local government units, the following Guidelines, Rules and Regulations governing countryside and barangay business enterprise are hereby promulgated for the compliance, information and guidance of all concerned:

Preliminary Provisions

Sec. 1. Principles. – Registration procedures and granting of incentives shall be governed by the following principles:

a. That the rensponsibility for the implementation of the law rests principally on the local government units;

b. Tha t the burden of proof for non-compliance with the requirements shall rest with the government.

Sec. 2 Definition of Terms. – When used herein, the term:a. CBBE – shall refer to countryside and barangay business enterprises; b.Productive business enterprises – shall mean entities engaged primarily in the production, processing or manufacturing of products or commoditites, or other productive business enterprises recommended by the Department of Trade and Industry provincial office that will help develop the economy in its area.

c. Professional services – shall refer to services rendered in connection with the exercise of a profession, avocation or occupation duly licensed by the government.

d. Countryside – shall refer to all cities and manicipalities.

e. CBBE Certificate of Authority – is the certification issued to an applicant authorizing the same to operate as a CBBE and to untitled to the benefits and priviledge accorded to a register CBBE.

f. EMPLOYEES- shall mean all person hired by the CBBE.

g.ASSETS – shall mean all kinds of properties, real or personal, owned by the CBBE and use for the conduct of its business. In determination of total assets, the properties of all branches, agencies or divisions of the business entity shall be included.

h. Registration – shall mean the inclusion of CBBE in the CBBE. Registry of an eligible city or municipality.

I.Financing – Shall refer to all borrowing of the CBBE from all resources after registration.

j. ACT – shall refer to R.A 6810, otherwise known as KALAKALAN 20.

REGISTRATION OF CBBE

Sec. 3 PLACE OF REGISTRATION. – The office of the Treasurer of each city or municipality shall process the registration of CBBE.

Sec. 4 Function of the City or Municipal Treasurer in CBBE Registration.

- To recieveall application and process in the same as expeditiously as possible.

Sec. 5 Who are ligible to Register – Any Person, natural or juridical,cooperative or association, having the qualification.

- At the time of registration, the application should have no more than 20 employees.

- -The applicant should engage solely in productive business enterprises.

- The assets, before financing, of the applicant should not exceed Five Hundred Thousand Pesos.

- The applicant does not own an existing business that has been collapsed and or transferred to the countryside for the purpose of setting up the same line of business.

Sec. 6 Requirements for Registration – The applicant for CBBE registration shall submit the following:

- Application form, in duplicate , signed by the owner or manager of the applying entity (CBBE Form 01).

- -1 picture of the owner in case of single proprietor-ship, and the manager in case of other types of business entity.

Sec. 7 FEES and CHARGES. – Applicant shall , upon approval of his application, pay the registration fee of 250 PESOS to the city or municipality.

Sec. 8 Period within to apply for Registration – applicant for CBBE Registration shall be made, Application made after that date will no longer be entertained.

Sec. 9 Approval of APPLICATION for Registration and Issuance of the CBBE Certificate of authority.

Sec. 10 Durationof CBBE Authority. – The CBBE authority shall be valid for a period of 5 years

from date of registration, without any renewal.

Sec. 11 Grant of JURIDICAL PERSONALITY to CBBEs. –

Sec. 12 Denial of Application for Registration. – The denial of any CBBE application shall be conveyed to the applicant within 24 hours

receipt of the same, stating the grounds for denial.

REVOCATION or Cancellation of CBBE Certificate of Authority

Sec. 13 Revocation, CANCELLATION or suspension of CBBE Certificate of authority – the CBBE Certificate of authority may be duly revoked, cancelled or suspended by the city or municipal registration office,

Sec. 14 Notification of changes of addressSec. 15 Transfer of ownershipSec. 16 Establishment of Branches

Benefits and Privileges

Sec.17 Exemption from taxes and fees.Sec. 18 Exemption from government rules and

regulation.Sec. 19 ALL fees and charges derived from the

registration of CBBEs shall accrue exclusively to the city or municipality and shall be used

for the administration of the act and for development projects approved by the

minicipal or city council.

• Sec. 20 These guidelines, rules and regulation shall take effect 15 days after publication in a newspaper of general circulation.

THE END ! ! !