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What can P7,000 get you?

"Such a handsome payback."

 

For us ordinary mortals, P7,000 can help us settle our utility bills, electricity, water, cable television subscription and internet services. Or it could get us a steak dinner for two at a mid-end restaurant. And for some, as per estimate of some government agencies, P7,000 could only be a little less of what a family of five needs a month to survive.

But for the Matibag couples and their associates, if PBA Congressman Jericho “Koko” Nograles is to be believed, the return for a P7,000 investment could be beyond comprehension.

With their connections strategically in placed, Nograles said the Matibags were able to corner the operations for the Wholesale Electricity Spot Market, inheriting it from the PEMC, a government-owned and-controlled corporation, including its assets, even as their company, the IEMOP was only four months old then with a measly P7,000 paid-up capital which is not even enough to finance a food cart business.

The secret? IEMOP’s well-placed connection. At the time the deal between PEMC and IEMOP was entered into, Nograles said the president of IEMOP, lawyer Richard Nethercott was already married to Department of Energy Assistant Secretary Caron Aicitel Lascano. Also, IEMOP incorporator-treasurer Ma. Rene Ann Lourdes A. Garcia-Matibag, who also served as the corporate services head of the PEMC when the deal was entered into, was revealed to be married to DoE’s National Transmission Co. president lawyer Melvin Matibag.

And now, their P7,000 investment is paying off. According to Nograles, IEMOP is now earning at least P3 million to P4 million a day or about P1.2 billion annually. With such huge earning, Ma. Rene Ann Lourdes, who is also a provincial board member of the Province of Laguna, is said to be taking a helicopter ride regularly to the provincial board meetings. That’s just a sample of what their P7,000 investment, according to sources, as their lifestyle was said to have completely taken a drastic change, from what used to be a life of simplicity to an arrogant display of affluence.

They have to prepare for the worse, though, as  Nograles said they could be facing charges ranging from graft and corruption to plunder.

* * *

Napanood ko na yan.

It seems  Davao-based businessman Dennis Uy is not yet done with his business expansion as he is now seeking to expand his shipping and logistics firm, by acquiring a new vessel.

However, deep into debt with about P85 billion in loans. Uy’s request for new funding for a new vessel, amounting to P700 million, was said to have been turned down by bank creditors prompting the businessman to ask for a sovereign guarantee which would allow his logistics company to lock up the loan from “one of the main banks in the country.”

While Uy assures us he will honor his firm’s debt, a state or sovereign guarantee is an assurance for lending banks that the government, through Philippine Guarantee Corporation would have to shoulder Uy’s loans in case of default. Under its program for large accounts, the PGC may repay up to 90 percent of the borrower’s loan in case of a default.

This is nothing new. Philippine taxpayers have long shouldered the payment for favored companies and individuals who have defaulted in the payment of their loans.

Take the case of former Speaker Jose de Venecia who acquired a US$120-million loan for his firm, Landoil during the time of former President Ferdinand Marcos. But de Venecia successfully shifted allegiance to Marcos’ successor, former President Cory Aquino, and there were questions about his debt being reportedly paid off using taxpayers’ money.

In his article in 2011, the late Neal Cruz bared that the Lopezes owed the government P1.6 billion in loans for several of their businesses, which was eventually written off by the Development Bank of the Philippines, charged again at the account of the poor Filipino taxpayers.

Now here comes Uy asking the government to guarantee his loan, of course with public funds.

Just how can he convince us that his firm, the Chelsea Group, will be able to pay off his debts? While his company has raked in P47.35 million in profits in 2017, this was said to have been reversed in 2018 by a net loss of P622.13 million.

And while his company’s total assets grew 22.3 percent year-on-year to P32.29 billion in 2018, its liabilities, including loans, grew faster by 51.2 percent to P15.62 billion.

As my friend Obet de Castro opines, this is another case of one bullet scoring three hits.

First, the state will guarantee a loan to be used for capital by a private business. Second, the profits will only be enjoyed by the said private company. But in the end, after siphoning off all the resources of the private company, it will just then declare bankruptcy and the government, using public fund, will end up paying for its debts.

Bumenta na yan. Maawa naman kayo sa amin.

Topics: Jericho Nograles , Jose de Venecia , Dennis Uy , Ferdinand Marcos
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