Duterte’s China deals, dissected

As part of Philippine Center for Investigative Journalism’s special report on Duterte’s China romance, I conducted research into the firms that signed deals during his state visit. What I found was that, among the Philippine parties to these deals include:

• firms with no track record in major infrastructure projects, no recent operating profit, and alarmingly small asset bases;
• firms and personalities that have been implicated in anomalous deals, including Arroyo-era “bridges to nowhere” and the Smokey Mountain Rehabilitation Project; and
• two firms involved in the nickel ore trade with China, one of which had been implicated in smuggling cases at Subic.

“How did virtually unknown firms with no track record in bidding for—much less completing—major infrastructure projects, rise to billion-dollar prominence with the change of the administration?

“For the firms that have no records with the SEC: if they aren’t registered to do business in the Philippines, how could they be party to billion-dollar deals on our behalf? For freshly-registered firms how were their directors able to both anticipate Duterte’s turn to China, and secure influence with the new government so quickly?

“Given the ambitious scope of these projects, can the smaller firms, some of which appear to be seriously undercapitalized, be trusted to deliver on time and within budget? Would any sensible lender take the risk of extending credit to these firms—or will their access to capital depend on intercession from on high?”

Read the full story: Duterte’s China deals, dissected.

Other stories in this series, “Romancing China under DU30”:

Reading list: Manila

Manila reading list – 2017-08-29

About

This is a reading list about Manila, the Philippines. As with Manila, it sprawls, in dendritic and uneven ways, reflecting the interests of its author(s).

It considers work in/on urban, urbanizing, and in-transition lowland Luzon, the ribbon of desakota stretching from Lingayen to Lucena.

It also considers processes that are key to understanding Manila, circa 2017: disasters, exclusion, outsourcing, remittances, global production and reproduction networks, urbanization elsewhere in the Philippines, Southeast Asia, global South.

It will neither assume nor impose a clearly-defined boundary to Manila. Nor will it attempt to be the authoritative bibliography about Manila.

This reading list is maintained by Kenneth Cardenas, and is licensed under a
Creative Commons Attribution-NonCommercial-ShareAlike 4.0 International License.

The latest version of this document will always be made available at kennethcardenas.wordpress.com.

Contribute

This list is open to contributions and revisions.

It is also open to conversations about what should be included in it (Fiction? Films? Secondary datasets?), and how these should be included (Annotations? Subject headings? Spinoff syllabi?).

It is less open to conversations about what shouldn’t be included.

If you would like to add resources (or your own work!) to this list, please do get in touch:
firstnamelastname at gmail.

Respect and gratitude for the inputs from Maria Khristine Alvarez, David Garcia, Sara Meerow, Benjamin de la Peña, and Kristian Saguin.

Changelog

Inclueded Maria Khristine Alvarez’s additions.                      29 August 2017
A few corrections.                                                                 25 June 2017
A few new titles.                                                                   9 March 2017
Included Sara Meerow’s additions.                                        6 September 2015
Included Kristian Saguin’s additions.                                      17 June 2015

Todo

Make the reading list available in a database format, as per Benjamin de La Peña’s suggestion.
Annotations.

Urban Property Development and the Creative Destruction of Filipino Capitalism

This material originally appeared as Cardenas, K. (2014) “Urban Property Development and the Creative Destruction of Filipino Capitalism”. In W. Bello and J. Chavez (eds.) State of Fragmentation: The Philippines in Transition. Bangkok: Focus on the Global South. This entry is the first in a four-part serialization.

Part II: The new rules of the game
Part III: Back to the land
Part IV: The city and the restoration of class power

The past decade had been incredibly good for Filipino capitalism. In 2000, the combined profit of the thirty companies comprising the PSE composite index stood at PHP 26.1 billion. By 2010, it grew to 304.23 billion, or an increase of 635 percent in real terms. Within the same ten years, the Philippines’s gross domestic product grew by only 59 percent (see Table 1). In 2006, when Forbes began publishing an annual list of the richest Filipinos, the combined net worth of the forty wealthiest Filipinos was US$16 billion. By 2010, their fortunes were collectively worth 22.8 billion dollars, an increase of 32.3 percent in real terms. In comparison, GDP per capita increased by a mere 13 percent within the same period.[1] Far from depending exclusively on the Philippine market, several of their conglomerates are presently embarking on ambitious foreign expansion plans. Henry Sy’s SM Prime is presently planning to open five more malls in China within the next three years;[2] the Gokongweis’ Universal Robina is eyeing a factory in Burma, which would follow successful investments into manufacturing in Thailand, Vietnam, Malaysia, Indonesia, and China;[3] and San Miguel Corporation, as part of its plan to bring total sales to one trillion pesos by 2013, is planning to put up plants in Burma, Cambodia, and Laos.[4]

TABLE 1. The Philippine economy versus PSE Composite Index company net incomes, 2000 and 2010.[5]

table-1

This was by no means an expected outcome. The 2000s was a very turbulent decade for business: it began with Philippine capitalism in serious crisis, with the economy still reeling from the Asian financial crisis of 1997-8. The initial contraction, at half a percent, was mild compared to the severe drops seen in the rest of middle-income Southeast Asia. But an anemic recovery, coupled with a hollowed-out neoliberal state unwilling and unable to either stem the outward flow of portfolio investments or to spend its way out of the crisis, prolonged the economy’s stay in the doldrums, culminating in a fiscal crisis in 2005. For much of the decade, the country was also in the grips of a political crisis. The impeachment trial of Joseph Estrada, the subsequent revolt of middle Manila, and the installation of Gloria Macapagal-Arroyo in 2001 proved to be only the beginning: as the decade wore on, Arroyo’s questionable mandate increasingly became illegitimate, and would echo throughout the decade as a rigged election, mass mobilizations, and the reanimation of an adventurist, impune military. Finally, its closing years saw the global capitalism erupt in a systemic crisis that it has yet to emerge from.

Continue reading “Urban Property Development and the Creative Destruction of Filipino Capitalism”

The new rules of the game

This material originally appeared as Cardenas, K. (2014) “Urban Property Development and the Creative Destruction of Filipino Capitalism”. In W. Bello and J. Chavez (eds.) State of Fragmentation: The Philippines in Transition. Bangkok: Focus on the Global South. This entry is the second of a four-part serialization.

Part I
Part III: Back to the land
Part IV: The creative destruction of Filipino capitalists

From the early 1980s to the present, the structure of the Philippine economy, its position astride global circuits of labor, commodities, and capital, and the opportunities for accumulation available to its capitalist classes have been defined by three sets of processes. First among these was neoliberalization. At first glance, the Philippines was perhaps one of the countries where neoliberalism saw an unqualified ideological triumph. It was among the first countries in the world to participate in structural adjustment program in 1980, and has since been the recipient of a total of nine structural adjustment loans from the World Bank and a participant in three IMF programs.[1] The momentum of neoliberal reform has been sustained from within by state economic planning agencies, the academe, and private-sector think tanks.[2] As a consequence, the Philippines has consistently gone above and beyond the prescriptions of the Washington Consensus: it had unilaterally adopted among the lowest average tariff rates in the world, innovated the privatization of economic zones, and embarked on some of the biggest privatizations in the world.

Far from being a completely ideological project, however, neoliberalization in the Philippines has been implemented in a specific, locally-contingent, and highly-uneven manner, and the resultant contours were crucial to the recent successes of domestic capitalists. This is perhaps most evident in the Philippine privatization program. Beyond the crown jewel corporations, such as Philippine Airlines, Petron, National Steel, and Napocor, public land and infrastructure have been the most consistent targets for privatization by successive post-EDSA governments. In Manila, the privatization of military-owned land, such as Fort Bonifacio and Camp Bago Bantay, of national government centers in Quezon City, and of reclaimed land on Manila Bay have in recent years been a defining feature of urban development in the city. Through the Bases Conversion and Development Authority alone, a total of 267 hectares in the city have been privatized in this manner, creating some PhP46.697 billion in revenues.[3]

Two particular features of the privatization program deserve closer scrutiny. Continue reading “The new rules of the game”

Back to the land

This material originally appeared as Cardenas, K. (2014) “Urban Property Development and the Creative Destruction of Filipino Capitalism”. In W. Bello and J. Chavez (eds.) State of Fragmentation: The Philippines in Transition. Bangkok: Focus on the Global South. This entry is the third of a four-part serialization.

Part I
Part II: The new rules of the game

Part IV: The city and the restoration of class power

All these transformations—the Philippine brand of neoliberalization, the unique vectors through which its economy globalized, and its uneven sectoral and geographical development—converge in urban real estate. Mirroring the trajectory of the economy as a whole, real estate development began the decade in crisis: the sector shrank from 2000 to 2002, hitting a 24.7 percent year-on-year contraction in the first quarter of 2001. But beginning with 2003, residential lot sales, coupled with office and retail space rental and leasing, have sustained record levels of growth: from the second quarter of 2004 until the fourth quarter of 2008, it sustained a double-digit streak, broken only twice by dips into high single-digit growth rates (see Figure 3). In the third quarter of 2006, the sector grew at a record pace of 26.2 percent year-on-year, breaking a record that was previously set in the third quarter of 1982. This record was broken yet again when the sector grew by 27.7 percent in the second quarter of 2010. At the end of its bust period in 2002, the gross value added of real estate development stood at approximately PhP8.8 billion. In 2010, it had grown to PhP22.1 billion.[1] If considered as a separate subsector, real estate was the second-fastest growing sector of the economy over the past decade, outpaced only by mining.

Continue reading “Back to the land”