Cebu’s power grid

Government Service Insurance System (GSIS) general manager Winston Garcia grabbed headlines recently by accusing the Manila Electric Co. (Meralco) of lack of transparency, and saying the state-owned pension firm can very well take over the country’s largest power-distribution firm so that high power rates can be brought down. But as the Garcia-Meralco word war drags on, doubts are being raised as to whether the GSIS honcho is really after lower electricity rates.

One question being raised is whether Garcia’s tirade against the Lopezes is part of a “Cebuano agenda.” Talk is rife that Garcia may be fronting for a powerful Cebuano interest, namely the Aboitizes. While his spokesman promptly declared that no member of Garcia’s family has ever done work for the Aboitiz interest, it is well-known in Cebu circles that the two families have a long history of beneficial relationships. For one thing, his cousin Jesus Garcia Jr. is director of Vivant, the holding company of the Visayan Electric Co. (Veco) of the Aboitizes. Another Garcia family member, Jess Anthony Garcia, who is Winston’s nephew, is a senior officer of both Vivant and Veco. Winston Garcia’s cousin Jesus Jr., who was transportation secretary during the Ramos administration, is also known to have given legal advice to the Aboitizes in their shipping business.

Well, there may be nothing wrong with the Aboitizes taking a strong interest in Meralco. After all, they have a track record both in power generation and distribution. They operate two distribution utilities, one of which, Veco, is the country’s second-biggest power distribution utility. But why is there an apparent effort to hide this fact?

One valid concern is whether Garcia may be leveraging the money contributed by GSIS members to push the Aboitiz interest in a Meralco takeover plan. This would be very unfortunate, since Garcia at the helm of GSIS holds a position of public trust, where he is expected to advance the interest only of GSIS members, not anyone else.

Garcia should come clean on this issue. In fact, former bourse chairman Vivian Yuchengo has declared she is gathering proxy votes for the May 27 stockholders’ meeting of Meralco. And it looks like she is doing it for GSIS, not because she is Garcia’s personal friend but because GSIS means big bucks.

If the Aboitizes want to make a legitimate bid for Meralco control, perhaps they should do so categorically.

Garcia’s supporters would like the public to believe that his tiff with the Lopezes is the result of genuine concern for the plight of Meralco customers. But the Garcias of Cebu, as far as we know, have never been known for their populist sentiment, but rather for being good lawyers for the business interests of their fellow Cebuanos. If the Aboitizes have a clear formula for lowering power rates, then we are very eager as the rest of Meralco customers to hear of it.

DA: What rice crisis?

The latest in the agricultural front is that the Philippines will soon buy 300,000 tons of rice from Thailand as part of bilateral agreements. We are told that the country is the world’s largest rice importer this year, having contracted to import 1.7 million metric tons (MT) of rice at a total cost of about $1 billion. But the Department of Agriculture (DA) clarifies that there’s no rice shortage, we’re only shoring up the country’s buffer stock during this period of volatile world prices and tight supply.

In fact, according to a DA report, the farm sector grew by 4 percent in the first quarter of this year, due to production increases in palay and other crops, surpassing the 3.3-percent growth in the same period last year. This is equivalent to P282.2 billion in the first quarter compared with P242 billion in the same period last year. The department attributes this to increased government spending on the repair and rehabilitation of irrigation facilities and the provision of higher-yielding seeds and postharvest facilities to farmers.

The DA has actually embarked on an ambitious five-harvest, rice self-sufficiency plan whose goal is to make the country 98-percent sufficient in the staple by 2010. This program has already garnered the support of provincial governors, who have agreed to fund fertilizer purchases from their P12.5-billion share of the internal revenue allotment. The local executives will also detail their agricultural workers and technicians to the agriculture department to fast-track the program.

DA figures indicate that palay production rose to a record 16.24 million MT last year. This is projected to reach 17.32 million MT this year. With palay production now averaging 4.07 percent yearly, and per-hectare yield average rising from 3.07 MT in 2000 to 3.80 MT in 2007, the country is on track in achieving rice self-sufficiency level to a projected 92.38 percent this year and to 98 percent by 2010.

What’s novel about the rice self-sufficiency plan for 2008-2010 is that it focuses on irrigation, technology, extension services and credit support for our farmers. Its primary strategy is what they call “clustering,” an area-based approach that departs from the usual large-scale yet unfocused implementation of previous palay-production programs.

But it’s not only on the production side the DA is concentrating its efforts on, but also on the distribution aspect. We’re not likely to see long rice queues as we did recently because some 25,000 outlets in Metro Manila will soon sell government-subsidized rice at P18.25 per kilo and high-quality commercial rice at P25 per kilo.

THE anxiety of foreign and local businessmen who view with concern what, to them, may be a potential case of state-driven cannibalization or takeover of the country’s largest and most profitable distribution utility, the Manila Electric Co. (Meralco), may find echoes in the case of the American Insurance Group (AIG), which, in 2005, was hounded with Rottweiler-like ferocity by Eliot Spitzer, its chairman and patriarch forced to resign just to spare the company from further pain.

Knowledge is key in a thriving economy—that’s why we are called Homo sapiens, thinking man. But in today’s borderless world, creativity and innovation—more than knowledge, per se—are the drivers in a knowledge-based economy.

Everybody hates the fact that prices are going higher. There is no question that price increases are outstripping income, at least in my household. Each day seems to bring new challenges to preserve purchasing power through substitution (DVDs instead of the cinema), conservation (it’s raining, you don’t need the air con on!) and elimination (try my new recipe for lechon bangus).

Alálaong bagá: Confidence in God

An anamnesis of divine goodness

In the manner of retrieval, the text from Deuteronomy tells the audience to call to mind God’s blessings bestowed upon their ancestors, to encourage them to trust that God would be no less generous with them. For the edification of the later generations Israel’s early days were idealized, and the desert period of hardships and grumblings, rebellions and deaths became a romantic symbol of first love and fidelity, focusing on God’s constant care for the people. 

About Town: Cebu’s power grid

Government Service Insurance System (GSIS) general manager Winston Garcia grabbed headlines recently by accusing the Manila Electric Co. (Meralco) of lack of transparency, and saying the state-owned pension firm can very well take over the country’s largest power-distribution firm so that high power rates can be brought down. But as the Garcia-Meralco word war drags on, doubts are being raised as to whether the GSIS honcho is really after lower electricity rates.

Tax Law for Business: Reinvestigation’s effect on prescription of tax collection

Subject to certain exceptions, the Bureau of Internal Revenue (BIR) has five years, following the assessment of taxes, within which to initiate the collection of taxes. But have you ever received a collection notice even after the expiration of this period? If your case is not one of the instances where the suspension of the prescriptive period applies, then you have all the right to contest the collection.

Reflections from the Mirror: A man who loved his country

What appears unrebutted during the confrontation between the Manila Electric Co. (Meralco) top honchos and Winston Garcia of the Government Service Insurance System (GSIS), with some contributions from former National Economic and Development Authority (Neda) chief Romy Neri, is that billions of pesos have been collected by Meralco as electric-meter deposits.