Mining your own businessBy Conrado Banal
Philippine Daily Inquirer
For quite some time now, some self-styled watchers of the environment are feeding us this rather sweeping claim against big mining companies: that our economy can actually do without them.
The thing is, our heroic watchers do not bother to substantiate such a claim. On the contrary, the Aquino (Part II) administration states that, as a policy, it considers new investments in mining as vital to our economy.
The administration policy in effect obliterates the very claim of our so-called watchers about this economically useless mining industry that is unable to help solve poverty in this country where about 40 million, and still counting, are considered “poor.”
The big mining boys remain the only targets of our brave watchers—not the administration, not the small mining firms. Only the big mining companies—exclusively!
While our professed watchers signify that they are only looking after the common good, it seems they are exercising selective minding of other people’s business in the name of the environment.
Studies proved that small mining firms were the biggest violators of environmental laws, particularly in their use of mercury and other toxic materials to extract gold.
The fact remains that the big mining boys spend hundreds of millions of pesos a year to take care of the communities in their mine sites, including their compliance with the safety nets imposed by the government.
Openly attacking those guerilla-type small mining operations was held as dangerous. For one, they enjoyed the backing of well-armed syndicates, made up of foreign hit-and-run poachers and LGU officials with their private armies.
To top it all, the avid watchers of our interests keep quiet about other environment issues, such as those concerning the businesses of the Lopez family, to which belongs the poster girl of the antimining movement, none other than celebrity Gina Lopez.
In the town called Brooke’s Point in Palawan, for instance, indigenous people accused the outfit Bantay Kalikasan (under the ABS-CBN Foundation) of desecrating their tribal ground for the real estate project associated with Lopez.
Her outfit cut down trees in the area called Sabsaban Falls and then put up cottages, reportedly for rent at P25,000 a day. Subsequently, the Palawan Council for Sustainable Development (PCSD) claimed the outfit did not have the permit that the law required on any project in the Palawan forest. The DENR said it would investigate the whole thing. Nothing happened.
Our stout-heart watchers did not even make a whisper in media about the complaints of the tribal people. Not even a mumble!
It turned out that ABS-CBN Foundation had this fat multimillion peso contracts with the city government of Puerto Princesa, tying up the foundation’s media facilities in a campaign to promote Palawan as an eco-tourism place.
The city actually forged the deal years ago during the time of Mayor Edward Hagedorn, and perhaps as an expected twist of the eco-tourism campaign, the group of Gina Lopez suddenly found themselves aligned with antimining groups in the province.
Thus the Save Palawan Movement, started by former Mayor Hagedorn, went to bed with some radical groups, led by the Kalikasan-People’s Network for the Environment (PNE), which reinvented themselves as environment activist groups.
Inspired by the inaction of the government—the DENR in particular—everybody just kept quite about the complaint of the lowly poor tribal groups in Brooke’s Point.
The SEC en banc, meaning the bosses at the Securities and Exchange Commission, reportedly decided to liquidate the assets of the Uniwide group, which some years ago was the biggest retail business in this country.
Surprisingly, the SEC decided to kill the business even after some 14 years of Uniwide being under SEC receivership, ever since Uniwide ran to the SEC for help to bring itself back to financial health during the Asian financial crisis in 1997.
Please, ladies and gentlemen, take note of that: the government agency on top of the Uniwide rehabilitation was none other than the SEC. And now, after 14 long years, time enough for four administrations in the Palace, the SEC deems Uniwide as a hopeless case. Question: Do you think the SEC did a chaotic crummy dirty job in the rehab?
It all started when, in 1999, two years into the Asian financial crisis, Uniwide announced it could not meet its debt payments, just like many businesses in the country and the whole of Asia at that time.
The SEC even found the Uniwide rehab to be highly achievable, considering that its assets of prime properties were worth almost P20 billion (at 1999 prices, mind you) with only P11 billion in total obligations.
Uniwide had cash flow problem. No enough cash came into the business to pay for the maturing debts. Uniwide needed the SEC as referee with the banks as it tried to recover from the shock of the Asian financial crisis.
Besides, Uniwide had milestone successes in the retail business, starting in 1975 when Jimmy Gow (the founder) put up the first Uniwide textile bargain store in Binondo. He was able to parlay the store into other business lines such as the first warehouse clubs in the country (some 10 of them), and real estate ventures such as Naic Resources and Development, Uniwide Sales Realty and Resources, and First Paragon.
At its height, the Uniwide retail outfits had some 3,000 employees, with a yearly cash flow of about P20 billion. It was the biggest retail business in the country at that time.
When Uniwide sought the SEC rehab program, then SEC Chair Perfecto Yasay Jr. appointed a receivership committee—made up of Monico Jacob, Arthur Aguilar and Cornelio Peralta—to keep Uniwide assets intact.
Subsequently, under SEC receivership, Uniwide started to lose its precious assets through various dacion en pago arrangements made by the SEC receiver with the banks, with the valuation of the assets left to the discretion of the banks, according to Uniwide.
Besides, the group claimed it had coughed up much-needed cash to cover the fees charged by the SEC receivership committee, on top of the handsome payments to the SEC “advisers” on the rehab plan.
To top it all, the receivership committee charged a “commission” of 2 percent of the total amount of cash that went into Uniwide, with or without the committee’s efforts.
The biggest beef of Uniwide was the supposed “white knight,” a French retail company called Casino Guichard Perrachon, which the SEC receivership pushed to the group as its savior.
It turned out that, instead of infusing cash into the company, the French wanted to buy the entire Uniwide group for P5 billion, although Uniwide put the publicly listed shares owned by the Gow family at close to P30 billion.
Besides, the purchase price—as pushed by the SEC big shots in the receivership—was not even be enough to pay Uniwide’s debts, forcing the group to reject the “white knight” deal peddled by the SEC.
Surprise—the SEC now claims the group’s liabilities totaled about P12 billion versus its assets of only P2.7 billion, although its “Metromall” (a four-storey mall a on 5-hectare prime property) was already worth at least P3 billion some years ago.
All of a sudden the SEC proclaimed that Uniwide was beyond redemption, now calling for its liquidation.
And all this after 14 years under the care of the SEC receivership, in a supposed rehab program devised by advisers hired by the SEC for handsome fees and was implemented by the supposed top executives appointed by the SEC itself.
Short URL: http://business.inquirer.net/?p=132191