MALACAÑANG has ordered the abolition of the Philippine Sugar Corp. (PhilSuCor) because “it no longer performs the objectives and purposes for which it was originally created.”
Executive Secretary Salvador C. Medialdea, on behalf of President Rodrigo R. Duterte, signed the Memorandum Order (MO) No. 30 on Oct. 25, authorizing the abolition of the PhilSuCor.
The Palace noted in the memorandum that the Governance Commission for GOCCs (GCG) “has recommended the abolition of the PhilSuCor.”
The functions and purposes of the company, according to the GCG, “duplicate or unnecessarily overlap with the functions, programs, activities or projects of the Sugar Regulatory Administration (SRA) and government financial institutions.”
It also said that the PhilSuCor “is no longer effectively performing the objectives and purposes for which it was originally created.”
The SRA is authorized by Republic Act (RA) No. 10659, also known as the Sugarcane Industry Development Act of 2015, to extend financial assistance through socialized credit to sugar cane stakeholders.
The memorandum noted as well that much of the financing needs of sugar mills at present “are already being provided by banking and financial institutions in addition to the lending facilities offered by the Development Bank of the Philippines (DBP) and the Land Bank of the Philippines (LANDBANK).”
To implement this order, the GCG will be assisted by a Technical Working Group composed of representatives from Department of Agriculture (DA), Department of Finance (DoF), Department of Budget and Management (DBM), SRA, and Privatization and Management Office (PMO).
The PhilSuCor, according to its Web site, was established on Nov. 14, 1983 by virtue of Presidential Decree No. 1890.
“Its creation was brought about by the need to support the sugar industry at that time, it being one of the biggest and most reliable sources of foreign exchange earnings of the country. During that time, many of the obligations of the sugar mills, refineries and other sugar facilities acquired after the war at heavy financing cost to rehabilitate the damaged sugar industry remain unpaid and in arrears; it created an onerous burden, not only to their owners, but to the local financing institutions as well. PhilSuCor was thus, created, specially charged and empowered to design and implement a program for sugar mills, refineries and other sugar facilities,” according to the company’s profile. — Arjay L. Balinbin