Biz Buzz: Steel wars

Barely warming his seat at the Bureau of Customs, the agency’s newly installed chief Nicanor Faeldon already has his hands full.

Apart from the difficult task of filling coveted positions with people of competence and integrity and removing so-called “rotten eggs,” the Customs commissioner has to ensure the smooth flow of trade while balancing competing interests of industry players.

One such conflict is between the Philippine Steelmakers Association (PSA) and dominant local player Steel Asia Manufacturing Corp. (Steel Asia) allied with the Philippine Iron and Steel Institute (PISI) and the Federation of Philippine Industries (FPI).

Up until the end of Customs Commissioner Alberto Lina’s term, PSA had a pending complaint about a supposed undervaluation committed by Steel Asia involving two billet shipments that arrived in February 2016. PSA claims that Steel Asia —owned by businessman Benjamin Yao—only declared a value of $205 a metric ton for its billet shipments against Customs’ specified billet “threshold value” of $240 a metric ton, representing a difference of $35 a ton.

Even with the allowable variance of plus-or-minus 5 percent, PSA says that the price declared by Steel Asia is way below the world price of $240 a metric ton. Ergo, PSA says, government is bound to lose millions of pesos in customs duties due to the alleged undervaluation.

Interestingly, PSA says that the threshold values were mandated by Customs in a Feb. 9, 2016, memorandum as recommended by Pisi, an organization of local steel players, whose president, Roberto Cola, is reportedly a ranking executive of Steel Asia. Hmmm.

This “coincidence” may explain why PSA is strongly opposing Pisi’s inclusion in the Philippine Chamber of Commerce and Industry’s “Customs Consultative Group”. But that, folks, is another story.

Since 70 to 80 percent of long steel products like blooms and billets are imported, local steel players are closely watching developments in this case. They want to know if Commissioner Faeldon will strictly impose the threshold value … or give in to Steel Asia’s “transaction value” as basis for computing and collecting duties. Abangan! Daxim L. Lucas

Hans’ new baby

WHAT will keep long-time SM Prime Holdings president Hans Sy busy as soon as the property magnate steps down from his job on Oct. 1?

The first order of the day for him, Hans tells Biz Buzz, will be to focus on National University’s project to put up a world-class sports academy in Calamba, Laguna. He feels strongly for this sports academy project and is very excited with the prospects of reaching the grassroots.

About P1 billion has been earmarked to build the sports academy, which is envisioned to enlist veteran sports professionals to train the next-generation athletes, starting with the most popular sports like basketball, volleyball and tennis.

The Sy family acquired control of NU, one of oldest universities in the country, in 2008. In the last few years, NU has become a strong contender in the University Athletic Association of the Philippines’ (UAAP) games.

Apart from chairing NU, Hans is also chair of China Bank, which will celebrate its centennial year in 2020. This is the storied bank that had funded the dreams of many of today’s taipans when they were young and penniless, including the Sy partriach, Henry. With more free time, people expect Hans to help grow China Bank and maybe narrow the size gap with sister Banco de Oro Unibank.

And no, Hans says he has no plans to dye his hair (which has turned grey over the years that he worked long hours at the helm of SM Prime). SM Prime, now the most valuable company with a market capitalization of P827 billion, has also become one of the largest property companies in Southeast Asia. Doris Dumlao-Abadilla

Out with the new, in with the old

HOPE springs eternal it seems for some government officials “allied” with a foreign firm that used to produce the country’s passports (and “assembled” on the premises of the Bangko Sentral ng Pilipinas’ Security Plant Complex in Quezon City). At stake, of course, is the handling of private information of passport applicants that used to be in the possession of this foreign supplier—potentially a big security risk for Filipino citizens.

Anyway, parties who are in favor of the old system seem to have wasted no time in trying to convince the new Foreign Affairs Secretary Perfecto Yasay that the current maker of e-passports—a government-owned firm called APO Production Unit Inc.—was not up to the task.

Among the allegations being leveled against APO is that it has “no capacity to print the new passports”, that it “has no plant to speak of”, and even that the new passports would supposedly be “printed in Indonesia”.

All these accusations are being thrown at the firm even before Yasay has had the chance to visit APO’s security plant facilities inside the Lima Export Processing Zone in Malvar, Batangas, we’re told.

At present, the Department of Foreign Affairs is paying a little less than P950 a passport under a multiyear operation authority granted by the Department of Budget and Management. The P950 fee paid by passport applicants was subsidized by DFA all these years because the old system was costly and inefficient. But today, DFA has a new e-passport with the latest security features made entirely by APO’s new, specialized machines that are state of the art—at no cost to DFA.

Most importantly, following President Duterte’s order, the line of applicants at DFA’s consular services unit in Aseana City has been shortened significantly. The question now is: Will we revert to the old system? Daxim L. Lucas

Game-changing drones

DRONES or unmanned aerial systems have been used by military strategists to gather intelligence or to launch air strikes in high-risk areas. Photographers, whether professionals or hobbyists, also use them to take awesome pictures of any landscape from an aerial perspective.

But drones can also be a game-changer in land surveying and titling, thereby helping the government and citizens secure land titles in a faster and cheaper manner, according to Foundation for Economic Freedom (FEF), an advocacy group formed by prominent economists. This is if the government would create a policy that includes drones among the acceptable survey tools and build the capacity of local geodetic engineers to employ them.

In a recent newsletter, FEF points out that one of the challenges in acquiring a land title in the country today is the the high cost of subdivision survey (the process of dividing a tract of land into smaller portions). Apart from being expensive, such surveys also tend to be time-consuming.

Subdivision surveys are currently done using conventional instruments and global navigation satellite system (GNSS) receivers, or the combination of both. But these don’t work out too well in crowded urban settings where subdivision surveys are normally conducted because they require point-to-point visibility and enough satellite signal reception.

In April, FEF teamed up with The Asia Foundation and Omidyar Network (an international humanitarian investment firm) to back a pilot study in Cordova, Cebu, to test if drones could be used in this country as an alternative tool for land surveying. The study was conducted by a team of two international and local companies of drone experts–Micro Aerial Projects and Skyeye and the Land Management Bureau in collaboration with the Municipality of Cordova and the Department of Environment and Natural Resources.

A survey-grade GNSS receiver attached to the drone is seen to give a more accurate positioning. “High resolution maps were generated and printed, which were very helpful for community members in identifying their parcels,” FEF said. “If there was a confusion on land boundaries, it would be easily and clearly pointed out, hence, resolving the issue right away.”

At the end of the study, the team concluded that the high resolution maps from the drone survey was as 95-percent accurate as the results from conventional field measurements. Doris Dumlao-Abadilla

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