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Covering
Events in the Philippines from 03rd May to 09th
May 2004
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Commentary
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Peso/USD
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55.68
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110.60
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67.1063
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99.735
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Phisex
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1,554.69
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Trust
and Governance
In the board game Diplomacy, players represent one
of several European countries (France, Germany,
Hungary, etc.) at around the time of World War I.
Described as a game of cunning and intrigue and
played on a board with incredibly simplistic movements
the game revolves around negotiation in order to
achieve your objective of conquest. No chance devices
such as dice or wild cards are brought into play
- superiority in numbers is all that is required
to achieve supremacy and win the game. To achieve
this, other players have to be brought in as allies
and as the game develops the various players usually
promise entirely different things to each of their
rivals in order to gain the upper hand. Only when
the simultaneous moves of all the players are revealed
will the others know who has been trustworthy, and
who has been sharpening their knives to stab them
in the back. Diplomacy as a board game can be a
nasty Machiavellian experience of political intrigue,
when your long time friend and ally suddenly becomes
a turncoat and your position collapses. Does this
all sound familiar? It should.
The Philippine is going to the polls this week.
Indeed by the time you read this the polls will
have already closed and the counting will have begun.
For the past 90 days, until the end of the campaign
period on May 8 the country has been standing still
while the country's political elite has played out
its election game. Indeed, were the ramifications
any less serious, one could be forgiven for thinking
that to many it IS all a game except in this case
the board is not made of cardboard but is in fact
the 7,000 islands of the Philippines.
Nobody doubts that the issues facing the Philippines
are as serious as they have ever been in recent
history. For the past twenty years, economic development
of the country - certainly as measured by increase
in per capita wealth - has stagnated. When reviewed
against what has been happening in the rest of Asia
the country has decidedly gone backwards. Yet "issues"
as such have had no place in this campaign; rather
it has been all about entertainment and gamesmanship
- what one newspaper wit over the past weekend termed
the "weapons of mass distraction."
If the pollsters are to be believed - and we present
the final surveys from this past week below, more
for matter of record than anything else - then President
Gloria Macapagal-Arroyo is likely to be returned
to office with a margin of around 10 percent. The
latest polls say she has a seven percent margin
but we tend to think that the K4 handlers may not
consider that sufficient and that an extra three
rabbits may be pulled out of the hat on polling
day. Certainly when the results of the two main
survey agencies are superimposed on one another
to produce a time series the upward trend of support
for GMA and the downward slip in support of her
main rival are clear and significant. The same correlation
is evident in the vice presidential vote where Ms.
Legarda has been on a decided upwards swing while
the former commanding lead of her main rival Noli
de Castro has all but dissipated. The prospect of
the country being run by two formidable women is
looming as a distinct possibility.
But there are other interesting factors to consider
as well in looking at the presidential poll results.
Two in fact that we would note: firstly the rise
in popularity of GMA has come relatively late in
the day; secondly there has been an even greater
increase in the strength of the "undecided" voters
to the extent that it is these "undecided" who may
well determine the election result.
The decision of President Arroyo to seek a second
term has not been greeted with universal acclaim,
in fact quite the opposite. For many, and especially
the business community, she is simply the "known
devil" as distinct from the "unknown devil." The
election is being viewed by many as a choice of
the lesser of two evils and that is a tragedy for
the Philippines. Certainly the claims (so far unproven)
of excesses and mismanagement have tarnished the
presidential image as has her flip-flop stance on
a number of key policy issues. At best she is seen
as providing a semblance of continuity.
But if anything at all, this election is likely
to be remembered as one in which the opposition
(in all its rainbow colors) snatched defeat from
the jaws of victory. Those opposed to a continuation
of the GMA presidency failed to unite behind a common
candidate - in fact there are four of them and the
performance of the opposition front-runner, Fernando
Poe Junior has been nothing short of a disaster.
Poe did everything wrong on the campaign trail:
he failed to turn up for rallies on time (or not
at all) and he alienated the media, several of whom
walked out on him in disgust. As a result he has
been deserted by a number of his supporters. His
actions perhaps suggest that he had no real appetite
for the dirty tricks of the political campaign and
was just going through the motions to please his
backers. He may not be too upset to lose the election
in fact and it may just put paid to any future moves
to draft movie actors into frontline political roles.
That would be no bad thing at all.
It is an old adage that "justice must not only be
done, it must also be seen to be done." Sadly in
the Philippines at the present time, many fear that
in this election justice will not be seen to be
done. There are rumblings in the press and elsewhere
that this poll will be as dirty as ever (and certainly
it has been among the most violent - see below)
with talk of mass rallies by the opposition if it
loses and fake ballot printing by opposition groups
to smear the result and discredit the poll. All
of this may be no more than pre-poll psyops by the
various parties and candidates and if, at the end
of the day, the election is judged even as reasonably
fair and honest it will be a major step forward.
The most likely outcome of this presidential election
is that President Arroyo will be re-elected for
a six year term. If this comes to pass the next
question engaging people's attention is whether
with a clear mandate she will set about truly reforming
this country by dealing affirmatively with the issues
that the voting public deems to be the most important
- graft and corruption on the one hand and law and
order, peace and security on the other. (It is almost
too much to hope that she may have a proactive population
policy). Alternatively will the six-year mandate
be seen as an opportunity to plunder the national
coffers, provide jobs for relatives and friends
for six more years as some fear?
We don't know the answer. Our best guess is that
the reality will be somewhere in between. Another
GMA term will see some further modest economic reform
(assuming she has the numbers in the Senate as appears
likely) with modest improvements in agriculture,
infrastructure, energy and debt management as well
as continued support from the international community
and especially the United States. But her weak stance
on population management and her inability to win
hearts and minds especially among the poorest sections
of society means at best that the Philippines will
continue to make only a few incremental steps forward
rather than the quantum leap it badly needs. It
will continue to lag behind Thailand and Malaysia
and may be overtaken by Vietnam. At worst, without
some decisive and positive actions to restore trust
and confidence in government (sadly lacking at the
present time), elements in the military could turn
against her and another coup attempt is not out
of the question.
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The Philippines Goes to the Polls
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The
second Monday in May is the date enshrined in the
Constitution of the Philippines on which Filipinos
go to the polls to elect their new leaders. There
are a total of 43,556,028 registered voters although
even the Commission on Elections admits that the
voters list is not entirely accurate. It is predicting
an 80 percent turnout. The 295,000 polling stations
will be open from 7am until 3pm.
A total of 17,656 elective posts are in contention.
Nationwide, people will be voting for president,
vice president, 12 senators, 209 representatives
of constituencies for the lower house of congress
together with 53 party-list representatives elected
in a single nationwide constituency. In additional
there are the local elective positions to be voted
upon: 79 governors and vice-governors of the provinces,
115 city mayors and vice-mayors and 1,497 municipal
mayors and vice-mayors. To this number must still
be added 742 provincial board members 1,264 city
councilors and 11,992 municipal councilors. There
are a total of 49,604 candidates running for local
positions.
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Pre-Election Violence -The Final Tally
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The final pre-election tally of violence released by the Philippines National Police list 103 election-related violent incidents since the start of the official campaign season. A total of 86 people have been killed and 159 have been wounded. Included in this total are 29 politicians who have been murdered and a further 13 injured. In the 2001 poll, 21 candidates were killed and 9 were wounded.
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The
Pollsters Have Their Final Say
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The
two main polling agencies, Pulse Asia and Social
Weather Stations both published their final poll
survey results during this past week and both showed
a continuation of the trends earlier reported. The
most noticeable trends are the widening lead GMA
is gaining over FPJ, the continuing decline in the
fortunes of Raul Roco and the rise of support for
tele-evangelist Eddie Villaneuva. Villaneuva drew
a record crowd estimated at between 1 and 3 million
at his final rally in Manila this week prompting
a number of commentators to opine that his showing
in the actual poll may be much better than expected.
However it is unlikely to be sufficient for him
to emerge the winner. Support for Mr. Lacson has
remained at around the 10 percent mark throughout
the recent surveys. The number of undecided voters
remains high at around 10 percent of total eligible
voters.
In the vice presidential race, Senator Loren Legarda
has made significant inroads into the previous lead
of Senator Noli de Castro. Again this is ascribed
to the fact that Legarda has been more articulate
than her rival in stating her policies.
The
Presidentiables
The
Vice Presidential Race
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Sandiganbayan Rules Against Cojuangco
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Three days before the national election and after
a staggering 17 years before the courts, the anti-corruption
court of the Philippines, the Sandiganbayan, has
finally ruled on some of the contested shares in
the San Miguel Corporation purchased using funds
collected as a levy from coconut farmers during
the Marcos era. The partial summary judgment, covering
a 27 percent bloc of the 47 percent of shares in
contention, awarded these shares to the government
to be held in trust for the farmers. The ruling
did not cover a separate 20 percent bloc held by
SMC chair Eduardo "Danding" Cojuangco.
Back in 1986 after the EDSA I 'Peoples Power' revolt
toppled the Marcos regime, the Presidential Commission
on Good Government (PCGG) sequestered 47 percent
of the issued SMC shares on the grounds that they
were purchased using public funds (the coco levy)
and were therefore part of the ill-gotten assets
controlled by the Marcos family.
The shares covered by the recent ruling were held
originally by 14 holding companies under the Coconut
Industry Investment Fund (CIIF) and "owned by the
government in trust for all the coconut farmers."
The court ruled that the United Coconut Planters
Bank violated the purpose of the levy when it invested
in the CIIF companies.
The remaining 20 percent of the contested stake
is held by Cojuangco who won provisional control
over the voting rights of these shares back in 1999
during the Estrada presidency thereby enabling him
to return to SMC as Chair and chief executive after
an absence of 12 years. Cojuangco currently controls
the 15-seat board of SMC because of the 20 percent
shares he is able to vote in his name, even though
the court has yet to finally decide on the ownership
of those shares.
Some 25.45 million shares are at present held by
the National Treasury and have not been earning
any dividends. If the value of the dividends earned
over the years by these shares are capitalized,
then the shareholding could rise from 27 percent
to 31.3 percent. A value of P47 billion has been
placed on the sequestered stake holding.
The Philippine Coconut Authority has said it will
seek the assistance of the PCGG as well as the CIIF
to tap into the dividend earnings, which are estimated
to have reached P1.2 billion. The Authority wants
to use these earnings in part to finance the fertilization
and rehabilitation of some 750,000 of farmlands
that are showing signs of biological stress. The
fertilization program to be fully effective nationwide
will require around P4 billion in funds.
PCGG chair, Haydee Yorac, claimed to the press that
the government would eventually get back the full
47 percent.
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While
every effort has been made to ensure the accuracy
and reliability of the information provided, no
responsibility can be taken should any of this information
prove to be in error.
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