Plan to privatize coco levy fund riles farmers | Inquirer Business

Plan to privatize coco levy fund riles farmers




UCENA CITY, Philippines—Coconut farmers’ groups on Friday reacted with fury over President Benigno Aquino III’s plan to privatize the estimated P73 billion coconut levy funds, calling it “plunder of the highest order.”

“Small coconut farmers are not asking the government to privatize the coco levy funds and assets. Our demand is for the government to return the money forcibly exacted from us,” said Nestor Villanueva, spokesperson for the coconut levy claimants’ movement Coco Levy Funds Ibalik sa Amin (CLAIM), and Rafael Mariano, chair of the Kilusang Magbubukid ng Pilipinas (KMP), in a joint statement.


They said the Aquino administration has no legal and moral right to privatize the coco levy-funded assets to benefit Mr. Aquino and big businesses in the coconut industry.


Plunder scheme

They said the privatization plan was another scheme of plunder.

Mr. Aquino, in two executive orders, EOs 179 and 180 that he signed on March 18, ordered the sale of all coco levy assets, the proceeds of which would be used to improve coconut farm productivity, boost coconut farmers’ income, strengthen coconut farmers’ organizations and ensure a balanced and sustainable growth of the coconut industry.

The coco levy assets to be covered comprise about P73 billion in cash held by the treasury from the settlement of the disputed San Miguel Corp. shares and about P10 billion in stock and other noncash assets of the United Coconut Planters Bank and the Coconut Industry Investment Fund (CIIF) oil mill group, according to Presidential Commission on Good Government (PCGG) Chair Andres Bautista.


No guarantee


Villanueva said there was no guarantee that small coconut farmers would benefit from the proceeds of the privatization. Instead, he said, privatization will completely diminish and deny small coconut farmers their legitimate claim over coco levy-funded assets and corporations.

“The small coconut farmers’ long demand is for the government to return the coco levy money and assets to their legitimate owners and not to privatize and sell these fund and assets for the benefit of big businesses in the coco industry and Aquino’s self-interest,” he added.

“This is plunder of the highest order,” he said.

Bayan Muna Rep. Neri Colmenares said EO 179 was patently antifarmer and would just benefit big players in the coconut industry “because this would essentially make the coco levy funds their private funds and do whatever they please.”

“We are against this and we urge the Palace and House leaders to instead make the Genuine Small Coconut Farmers Trust Fund as a priority legislation to truly benefit farmers,” he said.


Suspicious timing

Mariano believes the timing of the EOs was intended to help ensure Mr. Aquino’s political survival.

He said the coco levy fund issue was being used to help defuse mounting calls for the President to resign.

Mariano and Villanueva instead called on small coconut farmers nationwide to launch protest actions against Mr. Aquino and push for his ouster.

Jansepth Geronimo, spokesperson for the Kilusan Para sa Tunay na Repormang Agraryo at Katarungang Panlipunan (Katarungan), said EO 179 and EO 180 would not benefit the farmers.

According to Geronimo, the farmers have long been pushing for the creation of a coconut farmers trust fund from the levy funds, the annual interest earnings of which could be used for substantial programs to uplift the plight of millions of small coconut farmers and their families.

He said this was not in the two EOs, which dealt with privatization.

‘Disappointed and furious’

“The coconut farmers are disappointed and furious. This is not the EO that they expect from Malacañang,” he said.

EO 179 mandates the PCGG to identify and account for all known coco levy assets in the next 60 days, whether surrendered or sequestered.

EO 180 orders the Governance Commission for GOCCs (GCG), in consultation with the finance secretary, the presidential assistant for food security and agricultural modernization, and the Philippine Coconut Authority, to find ways to dispose of the noncash assets of the coco levy fund.

EO 180 specified three main coco levy assets for disposition—UCPB shares to be determined by the government; shares in the CIIF and its holding firms; and 5.5 million SMC shares held by the PCGG since March 1999.

Katarungan said it was strongly opposed to the proposed management of the fund by government agencies, particularly the PCA.

“The farmers’ money was robbed before by Marcos’ cronies with PCA as cohort,” said Geronimo.

He said the farmers were afraid history would repeat itself and the farmers’ money will be stolen anew.

Cojuangco’s role

The coconut levy was a forced tax imposed on coconut farmers, planters and millers by the dictator Ferdinand Marcos. Marcos assigned his crony, businessman Eduardo Cojuangco Jr., an uncle of Mr. Aquino, to administer the fund.

In various cases that the government filed in court, Cojuanco and his associates are accused of using the coco levy funds to purchase UCPB, coconut oil mills, 14 holding companies and the SMC shares.

In 2013, the Supreme Court upheld a Sandiganbayan decision to award to the government a 24-percent block of SMC shares, which was part of the 47-percent block of SMC shares that the government sequestered in 1986 on suspicion that the shares were part of the coco levy proceeds.

The high court said the coco levy funds, valued at about P70 billion then, were public funds and should be used by the government for the benefit of coconut farmers and to develop the coconut industry.

In April 2011, a 20-percent block of disputed SMC shares estimated to be worth P58 billion was awarded by the Supreme Court to Cojuangco.

CLAIM and KMP, among other groups, have clamored for the distribution of the coco levy funds to small farmers as cash, but the government insists that it be used for the whole industry and not as cash doles.


Cash, assets P83 billion

PCGG Chair Bautista said the coco levy assets were currently worth about P83 billion, P73 billion in cash and P10 billion from the estimated worth of the shares of stock of the UCPB and the CIIF oil mills assets.

“We will submit a detailed inventory of assets,” he said.

He said the PCGG was no longer involved in deciding how to use the coco levy funds.

The Supreme Court in July 2013 handed down its final verdict declaring that the sequestered shares of the coco levy-funded UCPB belonged to the government.

Bautista said the UCPB’s privatization had already been approved while the privatization of the oil mills had yet to be planned.

He said that while the oil mills have remaining assets, these are no longer operating optimally because they have been lacking funds for so long to modernize their equipment.

“They ended up being fully subsidized by the government. So I think privatization is the right direction to take, then use the money solely for the benefit of the coconut farmers,” he said.

Speaker Feliciano Belmonte Jr. said the House of Representatives would pass a law to complement EOs 179 and 180.

“No bill has been filed so far. But we will prioritize it,” Belmonte said in a text message.

He said the House bill would advance the interest of small coconut farmers. With a report from Dona Z. Pazzibugan


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Privatization of coco levy funds underway

TAGS: Benigno Aquino III, coco levy, coconut farmers, Coconut Industry Investment Fund, coconut levy funds, Kilusang Magbubukid ng Pilipinas, PCGG, President Aquino, Presidential Commission on Good Government, United Coconut Planters Bank

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