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LAKE ORION, Michigan: In the aftermath of last week’s exchange of
harsh words between the Arroyo administration and the Lopez business
empire over Meralco, observers—including the Filipino community in
this Midwestern American state—find themselves asking: Now what
was that all about?
The latest word out of Cebu—as of this
writing, anyway—has Winston Garcia saying that the Government
Service Insurance System (GSIS) had never intended to take over
Meralco, which is managed by the Lopezes.
“We are only after change of management so
that fairness can be done to the shareholders and fairness can be
given to the consuming public,” GSIS President and General Manager
Garcia was reported saying.
GSIS holds four of the 11 seats in the Meralco
board of directors. The rift between the government pension fund and
the country’s biggest electricity distributor surfaced after
Garcia publicly accused the Lopezes of mismanagement and lack of
transparency.
Other administration officials chimed in with
allegations that Meralco is responsible for the high cost of
electricity in the country—the second highest in Asia next to
Japan—that, in turn, allowed the Lopezes to rake in megaprofits.
The administration looked poised to grab control
of Meralco—notwithstanding Malacañang’s less than fervent
denial that it had nothing to do with GSIS’s takeover bid.
However, its appetite for battle waned when it realized that the
takeover bid further eroded what little popularity it still had.
Apart from criticisms from the usual leftists
and opposition mouthpieces, quarters that often avoid political
squabbles and are generally sympathetic to Malacañang did not look
too kindly on the Meralco takeover bid.
Peter Lee U, economics professor at the
University of Asia and the Pacific, conceded that the government
could lower power rates, once it runs Meralco—but at the expense
of taxpayers.
“If they charge lower than cost they
will not be able to recover [the actual expense of generating and
distributing electricity from] what they are charging,” U was
quoted saying in a published report. “And somebody will pay for
it.”
He recalled that the state-owned National Power
Corporation (Napocor) incurred multibillion-peso losses for charging
low power rates and for not raising its rates for over a decade.
Napocor’s outstanding debt as of end-2007 amounted to $7.17
billion—92 percent of which are foreign loans.
Meanwhile, three business groups separately
announced their support for efforts to bring down power rates, but
distanced themselves from talk of a government takeover of Meralco.
Officials of the Makati Business Club (MBC),
Philippine Chamber of Commerce and Industry (PCCI) and Federation of
Philippine Industries (FPI) were reported saying that they would
rather avoid involvement in the rift between the government and the
Lopezes.
MBC executive director Alberto Lim reportedly
said: “Taking management control is a step back from the
privatization program of the Electric Power Industry Reform Act. Who
else would shoulder the costs of that but us taxpayers?”
On the issues Garcia raised against Meralco, Lim
said they pertained to corporate governance and were thus internal
to the company.
“Garcia should not be making actions that
bring down the price of Meralco shares,” Lim said. “That is
contrary to his interest as a shareholder, and it only shows that
what he is doing is politics-laden. We won’t fall for the call to
support that.”
Donald Dee reportedly said PCCI appreciated the
need for government involvement in utilities, but not through
management control.
Jesus Arranza also said the FPI would rather not
be involved in the issue of management control of Meralco. “But we
are concerned with Meralco’s systems losses. The systems loss
charge should not be levied with the value-added tax because it is
not something we enjoyed or became productive with.”
Even pro-administration Sen. Joker Arroyo had to
concede that only the Lopezes have what it takes to run Meralco.
A Manila daily had Arroyo saying: “I will not
advocate [management change] because nobody knows how to run that
company except the Lopezes. Who will run it, the government? Napocor?
It will just fail.”
The administration evidently tried to portray
itself as the champion of power consumers who for decades have
suffered from high electric bills. In the end, however, its motives
came under question and its officials only succeeded in projecting
themselves as bullies.
The administration found itself in a contest it
had no hope of winning. Among Filipino expatriates, for instance,
Malacañang simply did not have the ability to air its side of the
argument.
Many Filipino-American households depend on the
Internet and cable/satellite TV to keep close track of events in the
homeland. In North America, abs-cbnnews.com and The Filipino Channel
are the most accessible sources of news on the Philippines.
Both the online news service and TFC try to
maintain their journalistic independence. However, as subsidiaries
of the Lopez-owned network, they never fail to give their owners’
side of the argument.
In a running controversy, that is half of the
debate won.
opinion@manilatimes.net
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