Fire sale monopoly
The Marcos’ coconut levy robbed farmers blind for years. Are these victims again being set up for an P84.3 billion “fire sale monopoly”?
President Benigno Aquino III froze tapping into sequestered P700 million San Miguel Corp. until the Supreme Court hands down a final decision on claims. Quarterly dividends, over the last two years, crested at P8.8 billion. Men have killed for less.
Marcos’ presidential decree 276 used martial law to clamp a levy on farmers who till coconuts in 68 provinces. Their taxes bankrolled a hydra of coco mills, a bank, even a producers federation that never mustered names of supposed one million members. Eduardo Cojuangco was coconut overseer, until People Power 1 drove him into exile with the dictator.
In the post Edsa revolt era, ex-Marcos commissars signed up the best legal minds who looted levies.
Cojuangco cashed in as main beneficiary. In a less than compelling Supreme Court decision, Arroyo justices ruled: Cojuangco could legally pocket P16.2 million in San Miguel Corp. shares.
“The joke of the century,” snapped then Justice Conchita Carpio-Morales. Cojuangco “used for his personal benefit the very same funds entrusted to him,” Morales dissent states. (These) were released to him through illegal and improper machination of loan transactions. (His) contravention of corporation laws . . . indicates a clear violation of fiduciary duty.
Go through the fine print of an earlier court decision on conversion of SMC shares, Budget Secretary Florencio Abad suggested in an Inquirer interview. It has a curiously “stitched in qualification” should government sell its shares. San Miguel Corp. “shall have (a) exclusive option to buy said shares and (b) at P75 per share.
Wait! Isn’t that a court-sanctioned fire sale for a cozy monopoly? A share now commands P114 at the stock exchanges, Coconut Industry Investment Fund chairman Wigberto Tañada said that in a free market, government would probably earn P87 billion for the small farmers. A January 2012 evaluation priced government’s SMC shares cresting at almost P85 billion.
But this bobby-trapped provision would shackle government into settling for only P57 billion. Who’d pocket the “diff” this time around? The loss would be a staggering P30 billion. Small coconut farmers would be suckered all over again. That would be “joke of the century 2.”
“Why the Supreme Court attached that condition is something that has to be seriously looked into,” Abad adds. That, sir, is an understatement. Since Inquirer published Abad’s question, reactions cascaded in.
“We cannot even begin to imagine the US Supreme Court ordering the Budsweiser Co., which is a major brewery here since 1876, to sell its shares below market prices,” notes Manuel de Torre, now a Milwaukee resident. “That’s price-rigging. Onli in da Pilipins?
“Who cobbled these legal shackles?” Carmen Montemayor of Danao City inquired. They create an economic monopoly by judicial fiat. Publish the names of the justices who crafted, then voted for an aberration that makes this Supreme Court purchasing agent for San Miguel.
Justices flip-flopped in cases like 16 towns-turned-cities-back to-towns and PAL flight attendants, recalls engineer Leonor Lagasca from Iloilo. “Has anybody been writing sub-rosa “Dear Mr. Justice” letters? What legal dodges will the justices come up with now? Only transparency guarantees accountability.”
Various options are being raised how best the Aquino administration could prevent further theft of the levy and how to use it best for the future. It is mulling a trust fund and considering various pending bills in Congress.
The track record is shabby, Sen. Joker Arroyo cautions. Proceeds from the P52 billion sale of military camps were to benefit soldiers. While others made a killing, the soldiers were left out. Arroyo called for the immediate cash distribution to coconut farmers of assets.
Impoverished coconut farmers cannot wait forever for the Supreme Court, says Secretary Joel Rocamora of the National Anti-Poverty Commission. The administration could borrow against the sequestered assets to undewrite a five-year P10-billion “road map” to revitalize the coconut industry,
The commission identified 609 poorest municipalities in the country. Of these, 493 cultivate coconut. In the first year of this road map, the funds will go to 153 municipalities in Camarines Sur, Leyte, Albay, Quezon, Sorsogon, Camarines Norte, Lanao del Norte, Northern Samar, Eastern Samar , Davao Oriental and Sarangani.
“Senate President Juan Ponce Enrile last December urged Congress: “Approve urgently trust fund for coco farmers. Otherwise, these assets would be dissipated.” UCPB has been criticized for issuing questionable loans to San Miguel. The bank is now under a P30-billion government rehabilitation program.
Coconut farmers groups, along with Bishop-Ulama-Pastors conferences, back creation of a trust fund, from sales of SMC shares, for the coconut industry rehabilitation. They also urge an updated census of coconut planters. No wang wang group takes over the farmers’ voice.
President Aquino has a once-in-a-lifetime opportunity to curb the avaricious who’ve battened off on the small coconut farmers. This demands grit. “For greed, all nature is too little,” Seneca once said.
