When personal reasons prevail

Over the weekend, Foreign Affairs Secretary Teodoro Locsin was very visible in his social media posts. Given his preferred mode of communications, @teddyboylocsin is very much followed not only by media but also of the entire diplomatic community here in the Philippines. This is not to mention his international following and the rest of his staff and personnel of the Department of Foreign Affairs at home and to those posted abroad with whom he also officially interacts through his Twitter account.

From his very supportive comments about the “commute challenge” that presidential spokesman Salvador Panelo went through last Friday, the DFA Secretary was also busy tweeting @teddyboylocsin on other subject matters. What caught my attention in particular was this post: “SOF Sonny Dominguez told me DFA should have one international bank, Standard Chartered. Good idea but I have no idea how to make it happen. Right now we pick and choose; I chose Bank of America; instant I was SFA my accounts were closed and I was given a check for the balance.”

Locsin obviously referred to another fellow Cabinet member, Carlos “Sonny” Dominguez who is the SOF, as in Secretary of Finance. The SFA refers to Locsin as in Secretary of Foreign Affairs. 

Replying to comments on this particular tweet recommending Hongkong and Shanghai Bank (HSBC), Locsin retorts: How would I know? I never even knew it was possible and why HSBC?” But Tweeter-savvy Locsin himself ended the thread on this topic with his last post on this subject matter: “Don’t worry it won’t happen. Things will stay as they are; we’ve lived with it; why change it.” So that’s where the off-the-cuff suggestion of the SOF to the SFA.

While it may be a private conversation he had with Dominguez, Locsin shared this with his Tweeter public following. And perhaps, to the chagrin of Dominguez who may have to explain his specific recommendation of Standard Chartered.

Speaking of Dominguez, the SOF may also deem it to explain why he is being pointed to as behind the alleged blocking of a loan application by a former business partner with whom he had a falling out in the past venture together. In particular, the name of Dominguez cropped up in the public laments of John Perrine, chairman and chief executive officer (CEO) of Al Sahar Agri-Ventures Inc. following the closure of the latter’s company venturing into a new banana plantation development project in Maguindanao.

Perrine has raised apprehension that its loan applications, which were deemed productive ventures, with both Land Bank of the Philippines (LBP) and the Development Bank of the Philippines (DBP) would be shot down due to past personal differences with Dominguez.

Perrine earlier announced with extreme concern what he fears to be the looming repercussions on the Mindanao peace process of the closure of the banana plantation that his company was developing for the export of cavendish bananas. 

Before its closure, over 1,000 jobs of which more than 600 consist of employed rebel returnees from the separatist Muslim factions that both have entered into peace agreements with the government one after the other. The rebel returnees come from both Moro National Liberation Front (MNLF) and the Moro Islamic Liberation Front (MILF).

In the midst of expanding an initial 400-hectare Al Sahar banana plantation into its projected 1,500 hectarage, it will extend the economic benefits for the communities in other areas of Maguindanao. The locations of which are specifically next to MILF base camps to provide jobs for the former armed combatants who were to recently decommissioned in rites attended no less by President Rodrigo Duterte.

The de-commissioning of armed combatants is part of the government’s peace agreement with the MILF that was sustained by President Duterte and who steered the passage of Bangsamoro Organic Law (BOL). The BOL gave birth to the newly expanded Bangsamoro Autonomous Region in Muslim Mindanao (BARRM) that included Maguindanao. Al Sahar’s plantation is located in the municipalities of Talayan, Budon and Datu Odin Sinsuat in the province of Maguindanao, one of the poorest provinces in the country. 

During the evaluation of the loan applications, both Land Bank and DBP officials expressed support to the project. According to Perrine, the LBP Board of Directors had earlier approved a loan for P1.6 billion for Al Sahar in February 2017. At that time, Perrine recalls, Dominguez sat as LBP chairman. But Al Sahar had requested for a change in one restrictive loan condition. Unfortunately, Perrine rued, he never received any reply if the loan was approved or not.

Al Sahar then applied with DBP for a loan on December 28, 2018. After undergoing full evaluation, the DBP Credit Committee, highly recommended for approval by the Lending Group Head for an amount of P2.05 billion. In a direct personal letter to Dominguez on August 16 this year, Perrine appealed to Dominguez to support even a reduced DBP loan amount of P496 million for the existing first phase of 402 hectares, which DBP had already verified that 85% of the assets were already installed.

Perrine wrote Dominguez: “The workers, their families, and the community leaders are all praying for your mercy and support for the DBP loan of P496M to save their livelihoods.” Dominguez only confirmed to have read the letter, according to Perrine – but no response. Thus, Perrine was forced to close down the expansion project and had to lay off his workers last month.

Perrine suspects “Sonny’s” animosity could have stemmed from an earlier partnership involving a similar 515-hectare banana plantation, Ardexcor, in Datu Paglas, Maguindanao (planted on 667 hectares of land leased from a company controlled by Dominguez which had acquired the former Datu Salipada Pendatun Estate from LBP). Thus, they became partners from 1999 up to 2007 – when Perrine offered to buy Dominguez’s 60% share due to declining performance of the farm.

But “Sonny” instead bought out Perrine. However, in October 2016, Dominguez abruptly sold the entire 515-hectare Ardexcor banana plantation (while maintaining a 25-year lease of the lands) for only P1.00 to his buyer, who supposedly advanced $2 million into the failing operation.

The buyer subsequently turned around and offered to sell Ardexcor to Perrine in February 2017 for the same price of P1.00 under the condition that he will be reimbursed of the $2 million that he had advanced to Ardexcor. To save the plantation and prevent the black mark on investing in the Bangsamoro that such a failure would have caused, Perrine accepted the offer, and invested about P166 million to rehabilitate the plantation.

From that time on, the plantation recovered and is doing well. It is estimated that the former owner, Dominguez, may have accumulated losses of up to P800 million when he sold the plantation for only P1.00. It was after Perrine’s takeover at the end of February 2017 of this former plantation of Dominguez that their personal relationship turned sour. 

When personal reasons prevail over other considerations, any decision becomes unjustly subjective.