BIZ BUZZ: CVP versus CGD

A couple of the trusted lieutenants of former Finance Secretary Cesar Purisima—CVP, for short—reached out to Biz Buzz after Monday’s item where Finance Secretary Carlos Dominguez III—or CGD—claimed there had been “no plan” turned over by the Aquino III administration to the current (and in a month’s time, outgoing) Duterte-led government in mid-2016.

One of them pointed out that CGD himself during the July 1, 2016 turnover ceremonies thanked CVP “for organizing a transition team led by [then Department of Finance or DOF] Undersecretary Malou Recente and Ken Abante,” whose “diligence resulted in a truly informative process.”

CGD’s remarks were publicly available on the DOF’s website up to now, he noted.

A former CVP staffer at the DOF wondered if CGD had “selective memory.”

That there was a smooth transition between the Finance chiefs of the late former President Benigno Aquino III and President Duterte is not in question. CVP even turned over a manual of institutional knowledge document to CGD, a DOF official noted last week.

But a specific and detailed “plan”—just like the fiscal consolidation proposal composed mainly of new and higher taxes pitched by President Duterte’s chief economic manager to President-elect Ferdinand Marcos Jr. last week—was what CGD said had been lacking.

Biz Buzz’s question to CGD last week was, would it help that the Duterte administration’s economic team will turn over the fiscal consolidation plan just like when CVP turned over the proposed comprehensive tax reform program (CTRP) to him years back? CGD answered: “No, I don’t remember.”

Biz Buzz recalled CVP presenting the CTRP proposal to foreign business chambers in closed-door meetings as well as, later, to some media, before issuing a subsequent press release detailing the proposal back in 2016. After all, P-Noy had been cold to other tax measures after he’d promised to prioritize the very successful “sin” tax reform; it did not help that the CTRP pitch pushed by business groups and a number of legislators back then came too close to the 2016 presidential elections.

But CGD said: “When we came in, obviously there had been some thinking about it (CTRP) that’s why we picked it up. But it was not formally turned over to us. We will formally turn it (the fiscal consolidation plan) over.”

“What I remember during the turnover, I spent about a month listening to all the different units. But there was no plan. Actually, this time, we have a plan,” CGD said.

But now, no thanks to the prolonged COVID-19 pandemic, the Philippines’ fiscal space eroded, its debt ballooned, and, as DOF officials warned, “a fiscal and economic crisis, as a result of higher debt, lower socioeconomic spending, and fewer investments” was looming, without fiscal consolidation. It’s like CGD outright telling incoming DOF chief Benjamin Diokno (or BED for short): “Do this, or else…”

—Ben O de Vera

Seaoil’s new investment

Seaoil, one of the country’s leading independent fuel companies, is investing P740 million to build a bulk terminal in the Zamboanga Economic Zone, Biz Buzz has learned.

Our source says the depot is designed for 18 million liters of storage capacity and can receive direct imports of petroleum.

This endeavor marks Seaoil’s first business venture into an economic zone, beginning with a groundbreaking ceremony in Zamboanga City late last month, and is being made in partnership with the Zamboanga Economic Zone and Freeport Authority.

More importantly, this project effectively widens the company’s footprint in Mindanao in terms of storage capacity and the capability to directly import fuel products.

This deal involves a 50-year agreement with the ecozone to create development projects and activities for terminal and jetty operations.

The total leased area is 2.12 hectares, with an option for further expansion.

The terminal and jetty development is set to be completed by 2023, and operations are projected to begin in the fourth quarter of the same year.

Seaoil chief operating officer Stephen Yu said this partnership with the Zamboanga Ecozone was “much more than a business decision.”

“By opening a terminal in Zamboanga City, we can make our quality products more accessible to retail customers and commercial industries in the area,” he said. “As we expand our retail footprint in Southern Mindanao, more fuel consumers from Zamboanga, Jolo, Sulu and Tawi-Tawi, among others, can experience how [we] take care of … customers through innovations.”

“The construction and operation of the facility will also provide more jobs and create more economic activities in the local community,” Yu said, adding that the effort would create an estimated 300 jobs for construction and operations, 90 percent of which would come from the local communities of Zamboanga City.

To date, Seaoil has over 650 branches nationwide, with more being built this year to meet its target of having 1,000 branches by next year. For sure, this new bulk terminal will be a big help in meeting that goal.

—Daxim L. Lucas