FVR testimonial on land probe will clarify issues – PHILEXPORT

The head of the umbrella organization of Philippine exporters welcomes the invitation for former President Fidel V. Ramos to testify in the next hearing of the Committee on Good Governance of the House of Representatives on the issues raised against the land leased to Philippine Exporters Confederation Inc. (PHILEXPORT) under the Export Development Act (EDA) or RA 7844.

“President Ramos’s testimonial will once and for all present the facts behind the leased land. After all, he and the late Trade Secretary Rizalino Navarro are the ones being accused of approving the “grossly disadvantageous” law and EO signed and confirmed by the Export Development Council (EDC),” said PHILEXPORT president Sergio R. Ortiz-Luis Jr.

He explained that in the EDA, the land serves as government counterpart through a “grant or a lease” to the “dominant export organization” to be accredited by the EDC, the highest export policymaking body in the country. The organization will manage the property and the facilities that are supposed to generate income to fund export promotion programs and projects. Such strategy supports President Ramos’s vision of developing the Philippines into an exporting country, Ortiz-Luis Jr. added.

PHILEXPORT, the EDC-accredited “dominant export organization”, opted for the lease of one thousand pesos a year because at that time, the organization could not afford the donor and real estate taxes otherwise involved in a grant. Further in this case, a lease agreement will not only save the government the cost of building construction and annual budget subsidy, but the land and all developments thereon will also revert back to government after the contract expires, he added.

However, the export leader clarified that of the five-hectare land, only 3.5 hectares was turned over to PHILEXPORT. The remaining 1.5 hectares is still being occupied by two attached agencies of the Department of Trade and Industry (DTI) namely, the Philippine Trade Training Center (PTTC) and the Center for International Trade Expositions and Missions (CITEM) to this day. PHILEXPORT chose not to possess this area as a courtesy to the DTI.

“Government was supposed to put in the money to set up the Philippine Trade Training Center referred to in the law that is to be managed by PHILEXPORT. But no money came, perhaps because government realized that it could not afford the construction cost of P500 million and perhaps some P50 million more in annual subsidy to keep the facility operating well,” he noted.

To address the situation, OrtizLuis Jr. said that PHILEXPORT reluctantly agreed to put together a consortium, called Manila Expositions Complex, Inc. (MECI), initially to build the World Trade Center (WTC) which President Ramos considers as “the most important facility if we are to be taken seriously as an exporting country”. President Ramos also wanted the WTC to be available as venue of the Asia Pacific Economic Cooperation (APEC) which we hosted in 1996, added Ortiz-Luis Jr.

With this as background, he expressed disappointment that there seems to be effort to put malice on the P1,000.00 annual lease, as if this were a commercial transaction. It could have very well been a P1.00 yearly rental or free use, rather than a land grant.

“PHILEXPORT has fulfilled all that is expected of it under the EDA and EO. Regrettably, it was only now that the additional facilities consisting of a hotel and office buildings are being built, since government failed to put in the money to help build them as envisioned in the EDA,” he added. “We then had to rely on private investors whom we hope will not be scared away by these hearings. As it is, the MECI investors are already complaining why they are being investigated, when they really took a big gamble in joining the consortium, and as a matter of fact, had initially been losing for several years.”

Fortunately, Ortiz-Luis Jr. said that this government strategy is now paying off.

“The WTC is already sustainable even without any subsidy from government. PHILEXPORT is also able to partly earn from this project. This, in turn, allows us to fund more export development and promotion projects and programs true to our mandate”, he added.

PHILEXPORT has submitted a financial report to Congress Committee Chairman Johnny Ty Pimentel showing that it had spent 92% more than the gross income from the WTC to assist exporters in various programs and projects in the last 21 years. PHILEXPORT has likewise been regularly providing the EDC a report on the use of the WTC income as required under EO 294, he pointed out.

The export leader also explained why the Department of Trade and Industry (DTI), represented in the MECI by the National Development Corporation (NDC), has not been at the frontline of these discussions.

“The oversight role of the DTI was transferred to the EDC when the late Secretary Navarro signed the lease agreement on behalf of the DTI. After all, the EDC, chaired also by the DTI Secretary, really has the oversight functions of the law and EO, ensuring that the WTC income will be used for export development and promotion purposes,” he said.

The PHILEXPORT chief added that he initially intended to ignore press statements directed against PHILEXPORT on this issue.

“First, the law and the EO are already very clear. Second, PHILEXPORT is a non-stock, non-profit organization which, even without the WTC income, has been implementing export development and promotion programs. But we owe it to our member-exporters to clarify these issues, since the news releases are based on