By Elijah Joseph C. Tubayan
CAGAYAN DE ORO CITY — Socioeconomic Planning Secretary Ernesto M. Pernia said he expects Mindanao to go about its business normally even after the President sought the extension of martial law until the end of this year, as the government is simply ensuring that the conflict in Marawi is played out.
“I don’t think there’s a consequential disruption of businesses in Mindanao. Life is still going quite normal, even in Cagayan de Oro which is quite close to Marawi. It doesn’t seem to be affected by what’s going on there. It’s business as usual, really,” Mr. Pernia told reporters in a news conference here yesterday, when asked on the effect of the proposed martial law extension.
He said that families and business owners may even feel safer, given the expanded military presence.
“So in fact, martial law is also an environment that will make people safe, and they will feel safe going about their business. So it’s not really a hindrance. It’s more of ensuring people that their life and businesses are not in danger,” he said.
“They just want to be very sure that no stone is unturned, as far as to make sure that these things are not repeated,” he added.
President Rodrigo R. Duterte announced that he wants to extend martial law in Mindanao up to Dec. 31. The initial proclamation was valid for 60 days after it was ordered on May 23.
Mr. Pernia said that Mindanao’s long term Regional Development Plan (RDP) remains intact, as the current clashes in Marawi are only temporary.
“In the national scheme of things, the impact of the Marawi crisis and the declaration of martial law in Mindanao (is limited)… I think the purpose of that extension is to make sure that there are no uprisings in other areas in Mindanao and make sure that the rehabilitation of Marawi will go smoothly without any interruptions. That is its main purpose,” said Mr. Pernia.
“In the bigger picture, it will not have any material impact or consequential impact in our development plan. For Northern Mindanao it will not be as consequential as stopping the RDP for Northern Mindanao,” he added.
Mr. Pernia has said that the Marawi conflict will not dampen economic output.
Philippine Statistics Authority data show that Autonomous Region of Muslim Mindanao accounted for 0.6% of gross domestic product in 2016.
However, the assessment of damage resulting from the occupation of Marawi has yet to be firmed up. Economic managers have said that they may have to await the conclusion of the siege before they start estimating the destruction of public and private property.
“We have to carefully and closely cost every destruction, everything that has been brought to the ground by the fighting. There is a lot of measurement to be done,” Mr. Pernia said.
An Executive Order that the Malacañang announced early this month bearing the title “Bangon Marawi” — a proposed blueprint for the rehabilitation of the city submitted by the Defense department — is awaiting Mr. Duterte’s signature.
The Department of Budget and Management has said that it has allocated an initial P15 billion for the Marawi City rehabilitation for the next two years, which is about three-fourths of Mr. Duterte’s earlier order of P20 billion.
About P5 billion will be initially released for rehabilitation, which will be taken from the 2017 calamity fund and savings from 2016, and will be followed by a P10 billion allocation that is sourced from the 2018 calamity fund.
The Chinese government has also donated P15 million for Marawi’s revival.
Mr. Pernia also said previously that multilateral lenders Asian Development Bank and World Bank are looking into providing technical assistance to execute the rehabilitation plan.
Out of the 4,895 projects worth P3.6 trillion lined up in the Three-Year Rolling Infrastructure Plan 2018-2020, the Autonomous Region in Muslim Mindanao will get 955 projects worth P50.71 billion, Northern Mindanao will have 117 projects worth P50.32 billion, Caraga in eastern Mindanao will get 66 projects worth P28.81 billion, while Soccsksargen (consisting of South Cotabato, Cotabato, Sultan Kudarat, Sarangani and General Santos City) will have 28 projects worth P7.8 billion.
SAN MIGUEL Corp. (SMC) is finalizing its entry into auto distribution, with the creation of a new unit for the importation and distribution of BMW vehicles in the country.
In a disclosure to the stock exchange, the diversified conglomerate said it submitted to the Securities and Exchange Commission (SEC) the documents necessary for the incorporation of SMC Asia Car Distributors Corp.
SMC Asia Car is 65% owned by San Miguel, with the remaining 35% owned by Palawan Governor Jose Ch. Alvarez, who currently chairs Asian Carmakers Corp. (ACC). The company will be involved in the importation, distribution and servicing of BMW vehicles in the country.
At present, ACC is the exclusive importer and distributor of BMW vehicles in the Philippines. It has eight branches, namely Autoallee BMW, Autohaus BMW, Motor Ventures BMW, Prestige Cars Makati, Autobahn BMW Bacolod, Autowelt BMW Cebu, Pampanga Premier Cars, and Premium Motoren BMW.
Vehicle sales in June showed a 14.1% year-on-year uptick, to a total of 37,631 units, according to a combined report Chamber of Automotive Manufacturers of the Philippines, Inc. and the Truck Manufacturers Association (CAMPI-TMP).
The CAMPI-TMP report showed ACC sold 240 vehicles in the first five months of 2017, 27% lower than the 330 units sold during the same period last year. This brought ACC’s market share to 0.15% as of end May.
SMC’s foray into auto distribution comes at a time when the government is looking to impose higher taxes on the automobile industry through the proposed Tax Reform for Acceleration and Inclusion (TRAIN) bill. Under the legislation, vehicles with an importer’s selling price over P2.1 million to P3.1 million will be taxed a minimum of P668,000 plus 80% in excess of P2.1 million.
Prices of BMW vehicles start at P3 million.
SMC is currently seeing the completion of various infrastructure projects, including the Metro Rail Transit-7 which is expected to be operational by 2019, the Tarlac-Pangasinan-La Union Expressway by 2018, as well as the North Luzon Expressway-South Luzon Expressway connector road or Skyway Stage 3 by 2019.
Earlier this month, Mr. Ang announced that the next leg of expansion for SMC would be through electronics, as it aspires to duplicate the success of South Korean electronics giant Samsung.
SMC posted a net income of P13.1 billion in the first quarter of 2017, on the back of strong growth across the firm’s food, beverage, oil, and infrastructure businesses. The company’s profits was supported by a 23% jump in revenues to P195.8 billion.
Shares in SMC were flat at the Philippine Stock Exchange on Tuesday at P102.90 apiece. — Arra B. Francia
By Jose Bimbo F. Santos,
Bloomberg TV Philippines
BUSINESSMAN Manuel V. Pangilinan said he is willing to divest his minority stake in the Inquirer Group of Companies following the Prieto family’s decision to sell its majority holdings to San Miguel Corp. President Ramon Ang.
“If there’s an offer to buy our stake at an acceptable price, we are willing to divest,” Mr. Pangilinan said in a text message.
The Prieto family holds 85% stake in the Inquirer Group of Companies, while Mr. Pangilinan, who is the chairman, president and CEO of PLDT, Inc., holds the remaining 15% balance.
Inquirer Chairman Marixi Prieto said in a statement on Monday that it was a “strategic business decision” to sell to Mr. Ang following talks that began in 2014.
“We are confident that Mr. Ang will support our commitment to pursuing the highest standards of journalism,” Ms. Prieto said in a statement.
Prior to the Prieto family’s decision to let go of Inquirer, the national broadsheet has been the subject of tirade from President Rodrigo R. Duterte over what the President tagged as “slanted” reports. Mr. Duterte has also threatened to take back the Prieto family’s 2.9-hectare Milo Long Property in Makati due to alleged tax arrears running into the billions.
UP journalism professor Danilo Arao said the Inquirer sale may be troubling for press freedom as the newspaper has been producing reports critical of the administration, but also noted Mr. Ang’s promise to uphold journalism standards.
But for a market analyst, business pressure beyond political pressure may have also played a part.
“There is political pressure, but I think the reason why they are selling out is the landscape is now getting more challenging not only in the Philippines but also globally,” said Astro del Castillo, managing director of First Grade Holdings.
Valuation and transaction terms have yet to be ironed out as of press time.
The Philippine Competition Commission also said that they will have to sign off on the transaction it breaches the P1-billion threshold for acquisitions.
“The review will look essentially into whether the acquisition would substantially lessen or impact competition,” PCC Chair Arsenio Balisacan said.
Hastings Holdings, Inc., a unit of PLDT Beneficial Trust Fund subsidiary MediaQuest Holdings, Inc., has a stake in BusinessWorld through the Philippine Star Group, which it controls.
