The SDA and the Cha-cha bailarinas

DIE HARD III
Herman Tiu Laurel
1/21/2011



Congress wants to do the Cha-cha (Charter change) again. But beyond the timing, semantics, and Miriam Defensor-Santiago’s histrionics lies the real simple reason for the hype over this new dance session. Money, or the country’s alleged lack of it, as well as the claimed need to attract foreign money by opening up to foreigners ownership of land and other businesses previously limited to Filipino nationals--supposedly for investment in social, governmental, and physical infrastructure, form the oft-repeated mantra by the likes of Enrile, Escudero, Santiago or Evardone, Haresco, Romualdo, Remulla, and Gonzales. What many of them seem to forget is that this is nothing but a reversal of the nation’s stellar Filipinization victories in the past such as the “Retail Trade Nationalization Law” and the vigorous campaign to end “Parity Rights.”

Senate President Enrile says he is strongly for amending the economic provisions of the Charter, particularly on changing the provision on the percentage of foreign investments in local projects, saying: “How can we have a meaningful investment policy if we are giving protection only to the rich? Only they are allowed to have 60 percent share in mining, agriculture, aquaculture, and transportation. Everything is 60 percent.” Well, he’s dead wrong.

On the other hand, administration ally Sen. Francis Escudero, in saying that Charter change should be initiated within the first two years of Aquino III when PeNoy’s “trust” rating is still high, simply states that it isn’t the validity of any argument for Cha-cha that matters but the manipulative opportunity to bank on the people’s trust for something they may not approve. But honestly, won’t this trust wear off, especially given that more MRT-LRT, toll, power and water rate hikes loom in the horizon?

The argument that Cha-cha is necessary to increase the “percentage of foreign investments in local projects,” i.e. to attract foreign moneys in, collapses in the face of headlines that have persistently appeared in the financial and business pages of Philippine newspapers: “SDA funds parked in BSP vault reach P1.22 trillion.”

The SDA is the Special Deposit Account with the Bangko Sentral ng Pilipinas (BSP) consisting of bank reserve requirements, investments, and such instruments set up in 1998 to serve as a “toolkit” of the BSP to manage the country’s financial environment. P1.22 trillion is almost $28 billion, an amount that exceeds all the funding requirements for PeNoy’s Public-Private Partnership (PPP) projects for all of the next six years. The National Economic Development Authority (Neda) estimates the 10 PPP projects for 2011 to be worth only P170 billion, and Budget Secretary Abad himself said that government was only “looking forward to generating P180 billion to P200 billion worth of PPP undertakings“ this year.

The real motivation for Cha-cha in changing the economic provisions has been in the shadows for the past two decades. This motive is expressed coyly in the words of Party-list Rep. Teodorico Haresco (from a group deceptively named, Kasangga). In arguing for Cha-cha, Haresco pointed out that “ China , which zealously guards its sovereignty, grants investors a 99-year lease on land, which is tantamount to total ownership.”

So the real reason behind this persistent revival of Cha-cha is nothing but the economic sell-out of the entitlements of Filipino citizenship and the affirmative, preferential treatment of Filipinos in their ownership of the national patrimony. The thing with these legislators (most of whom own huge properties such as Splendido and the like) is, with the removal of existing limitations on foreign ownership, the first to taste the bonanza would be these super rich landowners as land prices go up with the expected windfall of foreign funds.

That there is more than sufficient internal capital to fund any economic recovery is incontrovertible after reading about the buck-passing of the BSP and the local banking cabal. For instance, last September 03, 2010, it was reported that “Banks (were) urged to fund infra projects… (using their deposits) with the special deposit account facility of the Bangko Sentral ng Pilipinas… (adding that banks) can use some of these idle funds to help finance the government’s infrastructure projects.” Meanwhile, last November 17, 2010, the “BSP (in turn, was) urged to lower interest rates on (the SDA) facility… to move against the tide and reduce interest rates.” Congress should be looking into this before opening the flood gates of the country to more foreign ownership of land, businesses (including media), and our lives.

As for the argument that foreigners can’t cart away the land, these Cha-cha instigators should first review the experience of Zimbabwe and other countries where natives were eventually dispossessed of all their land rights that they had to launch their own revolutions to reclaim these. As for the rest, all other arguments for Cha-cha are either minor accompaniments or outright distractions, such as “constructive resignation” Justice Reynato Puno’s lament about the Constitution’s imperfections and the need for constant amendments--because following his logic dictates that we must have a permanent Cha-cha every so often. The US Constitution, for one, has only been amended over 27 times in the last 201 years.

Certainly, of the four Philippine Constitutions since the First Republic , the worst has been the Cory Constitution. But if amendments are needed, let them be carried out by particular propositions submitted directly to the people for ratification; not the kind of “shotgun” or bailarinas’ Cha-cha of the elite corrupt nomenklatura.

Having divulged the long-kept secret that a P1.22-trillion or $28-billion SDA is lying idle in the BSP vaults which the government and the banking cabal refuse to utilize in order to maintain easy income from high interest rates while kowtowing to the impositions of the foreign financial mafia, we have exposed the total paucity of the argument for Cha-cha to remove limitations on the onslaught of foreign predators. We have also exposed the self-interest of the landowning class to multiply their wealth even if this ultimately robs a majority of Filipinos the opportunity to own a piece of land in their own country.

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