By Kevin Stoda, in the Philippines
I was perusing national newspapers this past weekend came across a section called the "Business Circuit" in the THE MALAYA BUSINESS INSIGHT. In four short vignettes or stories the author, unnamed (but using the email address of amadomacasaet@yahoo.com ) detailed the status of political-economic development in the Philippines, nearly 25 years after the last dictator of the Philippines, Ferdinand Marcos had been kicked out of office.
The political context of the set of four vignettes--i.e. for modern Philippines neophytes--is that the newly-elected president of the country, "Noynoy" Aquino is the son of the woman who helped oust Ferdinand Marcos and his cronies from office in 1986, the late Corazon Aquino. (Noynoy's father had been assassinated by Marcos less than three years earlier.) Noynoy has promised not to raise taxes this year. Instead, Aquino promises to pay down Philippine's recent debt through hitting down hard on corruption and tax-dodgers.
Will Noynoy be any different?
PROTECTION IS BIG MONEY
The first mini-article in THE MALAYA BUSINESS INSIGHT begins, " IT is common knowledge in customs that a powerful man demands--and gets-P25,000 per container coming into the piers. At the rate of 500 containers a day, that is easily P12.5 million per day." (P= Filipino Pesos, which are trading at about 46.5 to the dollar)
Naturally, I assume that many know the names of the largest smugglers working for the Filipino customs union. However, with the many disappearances and murders of journalist, the author hesitates to name names.
The author continues, "Another P10,000 per container goes to somebody whose job is to stamp out smuggling. That's P5million a day. No Sweat."
"What do the importers get in return? A fatter sum, of course! Their imports, which are misdeclared as raw materials but are actually consumption goods, are documented as being kept in customs bonded warehouses," the author continued.
What is the truth? According to Mr. Amadomacasaet@yahoo.com , "[G]oods are delivered to the compounds of the importers straight from the ship. No taxes are paid."
The author explains, "There is supposed to be a bond that secures the raw materials in the event they are withdrawn without authority."
"But the bonds are spurious," the writer concludes, "It is beyond my little knowledge of arithmetic to make a good guess of how much money is lost to the government. But they ran into the billions. Yet, sometimes customs announces it exceeds the collection target. Maybe the target is too small."
SEVERAL IMPORTANT POINTS
Several important details were left out of this article. First, the centralized government of the Philippines does make it hard on importers working and employing folks on a majority of the 7000 Philippine islands. The government creates this hardship by demanding that most every import comes through Manila ports. Therefore, the incentive to steer around legalities is high on almost every other island. (By the way, the Philippines, with more islands than neighboring Indonesia, should be a federal state and open up its direct trade to all regions.)
Second, in the same newspaper, there was an article entitled, "Gov't to auction rights to import 150,000 tons sugar."
