PHILIPPINE tycoon Dennis A. Uy has built an empire spanning oil, shipping, casinos and telecommunications, but eight years ago his oil-trading business was in trouble over government allegations of fuel smuggling.
Mr. Uy went to see the local mayor, a family friend from childhood, for advice. The mayor was Rodrigo R. Duterte, the country’s current president.
“He said my image is soft, so I should practice before a mirror saying, ‘You son of a b****,’ 100 times,” he said in an interview. “He doesn’t like when a person is bullied.”
Mr. Uy says Mr. Duterte has not played a direct role in his businesses, but the advice worked. He was cleared of the smuggling charges and went on to quadruple profit at his Phoenix Petroleum Philippines, Inc. in the five years through the end of 2018. Along the way, he says, he gained the toughness Mr. Duterte had been trying to instill in him.
“If you survived petroleum and shipping, it trains you to be battle ready,” said Mr. Uy, 46. “In petroleum, to get your one-peso margin, you watch everything from storage to trucking, and it’s common to give credit and deal with currency and oil price fluctuations.”
Before Mr. Duterte’s rise, the southern province of Davao was better known for its tropical fruit and an endangered species of monkey-eating eagle than for business powerhouses like Mr. Uy’s.
But in the past few years, Mr. Uy, who donated to Mr. Duterte’s presidential campaign, has spread far beyond the region, assembling assets that are eating into industries ruled by some of the country’s richest and oldest business dynasties.
In 2018, Mr. Uy teamed up with China Telecommunications Corp., to win a telecommunications license to challenge the duopoly of Smart Communications, Inc. and Globe Telecom, Inc. He had no previous experience as a carrier, but his company, now called Dito Telecommunity Corp., emerged as the sole bidder. Mr. Duterte has repeatedly called for greater competition in the industry, which has some of the highest mobile rates and slowest service in Southeast Asia.
After Mr. Duterte encouraged the Chinese wireless giant to join the competition, Norway’s Telenor ASA and Austria’s Mobiltel AG, which had bought documents to participate, did not bid. Streamtech Systems Technologies, Inc., led by the Philippine’s richest person Manuel B. Villar, withdrew from the race.
Smart is owned by PLDT Inc., whose Chairman Manuel V. Pangilinan has been repeatedly criticized by Mr. Duterte as an out-of-touch elite. The carrier’s largest shareholders include JG Summit Holdings, Inc., the banking, aviation and retail conglomerate now run by Lance Y. Gokongwei, founder John L. Gokongwei Jr.’s son.
The other telecom operator, Globe, has Ayala Corp. as one of its largest shareholders. Ayala is led by Chairman Jaime Augusto Zobel de Ayala II, a frequent Duterte target.
Mr. Duterte has also been a strong critic of the current telecommunications duopoly.
“The Philippines has been gravely fooled by the rich people in the Philippines,” he said on Jan. 23. “Just like Ayala and Pangilinan who own Globe and Smart. They are all thieves, those sons of b******,” he said, according to the official transcript of his speech.
A spokesmen for Ayala Corp. said the company did not want to comment on Mr. Duterte’s speech. A PLDT spokesman, who also represents Mr. Pangilinan, said he would not comment. Mr. Duterte’s spokesman has not responded to requests for comment. — Bloomberg
