Biz Buzz: Power connections
ENERGY Regulatory Commissioner Josefina Magpale-Asirit is one lucky woman if the buzz about her impending promotion does not turn out to be “kuryente,” or a dud report.
The loose talk among power industry players is that Asirit will be the next chair of the Energy Regulatory Commission once Janet Lim Napoles’ accused broker, Zenaida Ducut, retires in July.
A Malacañang legal opinion is being passed around indicating that there will be no legal impediment for the incumbent ERC commissioners to be kicked upstairs once the former Arroyo legal adviser finally lets go of her seat, which she has clung on to since she was dragged into the pork barrel scam nearly two years ago.
The Electric Power Industry Reform Act (Epira) requires that the ERC chair must be a lawyer, so it should be a tossup between lawyers Asirit and Magpale.
As everybody knows, Asirit is the niece of Rene Almendras, the former Energy secretary, the present secretary of the Cabinet, and forever presidential classmate.
Asirit was first an executive assistant at the DOE before she was promoted to assistant secretary and, later, undersecretary. Her DOE stint was supposedly co-terminus with Almendras’ transfer to the DOE, but she took on a more permanent post when she was named to the ERC. As ERC chair, Asirit will rule the roost for a fixed seven-year term.
Interestingly, Asirit already has an ally in place at the ERC board—Domingo Sta. Ana, an obscure accountant from, you guessed it, Cebu—as they share the same backer, her uncle.
Our buzzards tell us that Asirit’s imminent rise to the ERC has reportedly disappointed Energy Secretary Jericho Petilla, who wanted an independent ERC chair who could stand up to the browbeating of power bullies. We’re told that this was the reason why Petilla is leaving the Aquino Cabinet months ahead of the October filing for 2016 candidates.
By the way, Almendras might have earned his spurs as highly paid corporate executive, but politics definitely runs in his veins.
Almendras’ sister and Asirit’s mother is Cebu Vice Governor Agnes Magpale, who shot to national fame when she served the last six months in the term of then Cebu Gov. and now Cebu Rep. Gwendolyn Garcia in 2010.
This is why it has come as no surprise that Almendras is reportedly looking into diving into Cebu’s political battle zone when the “daang matuwid” reaches its end of the road. Gil Cabacungan
Tutuban’s tax bill
IT MUST have been an activity-filled week for lawyers of the state-run Philippine National Railways.
We heard that its legal experts have been meeting with their counterparts at the Manila City Hall over a long-running real property tax bill amounting to about P1 billion for land that also serves as the site of the Tutuban Center retail complex in Manila.
PNR is apparently negotiating for more lenient terms, meaning, paying some of those taxes on a staggered basis to avoid a public auction of the property, which is within the local government’s power in these cases.
Tutuban Center, at the heart of Divisoria, one of the country’s oldest trading districts, is being operated by a unit of listed Prime Orion Philippines Inc., which holds the lease over the land until 2039.
The site is more valuable now after the National Economic and Development Authority gave the go-signal for the Department of Transportation and Communications to proceed with the massive North-South railway project of the PNR.
That project involves around 700 kilometers of railway that will link Malolos in Bulacan to Legazpi City in Albay, apart from other branch lines.
The logical Manila gateway, of course, is Tutuban Center, where the North-South railway transfer station will be located, Prime Orion said.
In fact, the company already signed a memorandum of understanding with the DOTC and PNR to finalize the railway plans within a six-month period, a stock exchange filing this April showed.
PNR has been rather quiet about this issue, despite our pestering. Maybe that’s a sign things are finally being resolved. Or, maybe, not yet.
In any case, a swift resolution would be ideal. We understand that part of the railway project, whose cost will run into the billions of dollars, will be offered under a public-private partnership scheme.
Given what’s at stake, it’s better to get uncertainties like these out of the way. Miguel R. Camus
Willie’s aborted return
SOME may doubt TV host Wilfredo “Willie” Revillame’s ability to attract viewers once more, but his former boss Eugenio “Gabby” Lopez III, chair of ABS-CBN Corp., is certainly not among them.
In fact, Lopez thinks Revillame will do reasonably well with his new stint back at ABS-CBN’s main rival GMA Network, where Revillame is expected to host a new variety show called “WowoWin.”
“Willie is still Willie. We expect that it will rate,” Lopez said, referring to the closely watched TV ratings rivalry between both networks.
Those are generous words for a personality with whom he had traded legal cases following Revillame’s messy exit from ABS-CBN five years ago.
Revillame, a former professional drummer, parlayed his talent for comedy and a keen eye for mass market entertainment into one of the biggest variety game show franchises in the country.
He has also been a magnet for controversy, though that has done little to dampen the popularity of his shows, which typically involve song and dance numbers while Revillame himself doles out cash prizes to guests.
A little known fact: Revillame apparently approached ABS-CBN again for work, but Lopez said nothing came out of these talks.
While he did not get too specific on why it did not progress, Lopez did mention—as one should expect from the head of a major entertainment conglomerate—that there were no hard feelings between them.
“I have a very good relationship with Willie, still. Our world is too small to say never,” Lopez said. Miguel R. Camus
Century boss’ wish
CENTURY Properties head honcho Jose Antonio is going full-speed ahead with the projects at his flagship Century City development in Makati City, dismissing worries that the red-hot Philippine property may be due for a correction soon.
In fact, the property magnate remains bullish that the sector will continue its winning ways even with the threat of rising interest rates on the horizon, as well as the usual business uncertainty a presidential election brings.
Antonio said he would focus on completing his $100-million Centuria Medical Makati project which would firmly position the property firm in the health services business.
Centuria is a modern, 28-storey structure that will house around 700 doctors’ offices and clinics (as well as commercial spaces for establishments in the “wellness” industry).
Centuria will not be a hospital in the conventional sense, however, as most of its clients will be served on an outpatient basis (higher turnover means higher revenues, of course).
According to Antonio, Centuria will try to attract as many doctors and clinics to cater to the aesthetic beauty aspect of the wellness industry—which is to say, they want lots of surgeons in the plastic surgery and liposuction business.
“That’s really big business,” he said.
And Filipino doctors in this field, he added, can stand toe to toe with their rivals in Thailand (who currently attract the bulk of inbound medical tourists to the region).
And while his project is certainly impressive, Antonio points out that there is something sorely missing from the broader Philippine success story.
“Infrastructure,” he said. “We need airports and highways so that tourists can come to the Philippines.”
He lamented that the country already seems to be happy with the tourist arrival numbers that are nearing the 4 million mark, when that same number is only the equivalent of tourist arrivals to a single beach destination in Thailand.
Of course, Biz Buzz had to ask Antonio point blank if he was aware of persistent rumors that the Century Properties empire was built with money supposedly stashed away by the former First Gentleman Jose Miguel Arroyo.
His reply was unexpected: “I wish! Then I would no longer have to borrow money for my projects.” Daxim L. Lucas
Water woes
THE LOCAL business community is on edge, no thanks to the decision of the Metropolitan Waterworks and Sewerage System (MWSS) to unilaterally change rate-rebasing rules in mid-concession.
Worse, the regulator even defied an international arbitration panel’s decision, thereby further scaring investors, many of whom are already hesitant about putting their money in the country.
These investors are now looking closely at so-called “deal-breakers as poor infrastructure, red tape, monster traffic, power shortage, and long delays in the government’s public-private partnership program.
No less than the heads of the local foreign chambers have voiced their displeasure at the sudden changing of the rules midstream, along with the government’s decision to disregard the arbitration panel.
“When a Philippine government-owned and -controlled corporation does not honor its contract, even after an arbitration decision rules against its position, the investment climate of the country is harmed,” said John Forbes of the local Amercian Chamber of Commerce. “This case is being watched closely as it affects investor confidence.”
We hear that Japanese investors are particularly alarmed because two of their companies—Marubeni and Mitsubishi—are investors in Maynilad Water Services Inc. and Manila Water Co.
Of course, Finance Secretary Cesar Purisima has made an oral commitment that the government will fulfill its obligations to the water concessionaires.
But there’s a big chance that government lawyers, under the Office of the Solicitor General, may not match with action the Finance department’s rhetoric.
Note that the government had come up with a friendlier compensation scheme in the 1990s as a way to entice investors to participate in the privatization program, which the Ramos administration had to carry out to avoid a then-looming water crisis—a crisis that was due, to a large degree to MWSS’ failure to make good on its mandate to deliver water to millions of Metro Manila households.
All this changed after the MWSS, or more specifically its Regulatory Office, decided to act unilaterally and ram the new rates down the throats of the two concession firms.
What’s the best way forward? Perhaps the Department of Finance can help the government save face by compelling the MWSS to implement the ruling of the international arbitration panel expeditiously. Daxim L. Lucas
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