Corruption rules

Our neighbors in the region are still way ahead of the game. The Chinese, for one, still rule in the export game, seeing how cheap labor still spells the marked difference in end prices of commodities. There is now an even larger expat community in Beijing, and they now have the first Chinese-owned francise of Harrows, which has traditionally educated Britain’s princes and other wealthy Britons in North London. In fact, China is home to another British boarding school, the Dutwich College. And speaking of the Harrow School UK, the Beijing branch is only the second overseas franchise they have opened, the first one in Bangkok over eight years ago. Now, why haven’t they thought of us? Surely, our British expat community is large enough to lure these franchises? Why Beijing and Bangkok and not cosmopolitan Manila?

China’s cheap labor has scared off a lot of exporters. Some of our own garments manufacturers have simply folded up, not because we can’t compete in quality, but because their labor costs are simply impossible to match. Mexico was heavily affected in 2001 because of this very real threat, and the manufacturing slump carried over to 2004 resulting to tremendous job losses and major manufacturing industries drying up. Several big subcontractors in fact moved their operations to China, and foreign investments were at their lowest.

Well, Mexico has sprung back. The foreign investors are back, and the country’s export has risen by an impressive 26 percent. They simply looked farther than their noses, past the obvious, cheap products they were exporting in competition with Chinese products, and went for the high-tech end. Their fiber-optic transmission equipment are now in demand, for instance, as well as their high-capacity data-storage cartridges, and large companies like Hewlett-Packard and Texas Instruments now are active investors in their major cities. Mexico no longer views China as a threat, not while the foreign investors keep coming ashore and setting up their tents here, in Jalisco where several electronics companies have put up base, or Guadalajara where info tech giants Hewlett-Packard and Texas Instruments are doing brisk manufacturing.

Here at home, our exports are still in a slump. The slowdown in productivity has also resulted in job losses, and while we read excellent prognosis in the business pages, reality still stares us in the face – unemployment is still insignificant numbers.

Why are the foreign investors not rushing in? Corruption is still perceived to be very high in the Philippines. And why shouldn’t it be seen as such? While we have NGOs and civic groups that stand as sentinels against corruption, the test of the pudding is in the eating. How many of these corrupt officials have been brought to justice? How many are behind bars?

In America, they seem to savor putting these VIPs away. Remember Martha Stewart, a veritable icon on American television? She ruled the airwaves for years, just expounding on simple good housekeeping and reaped millions from it. They did not think twice about putting her behind bars for several months for inside trading. And what of the alleged inside traders in that infamous trading scandal involving Bell Securities a few years back? They got away?

At the height of its sales blitz, Hyundai Motor is rocked with a scandal. Government prosecutors allege that the Chung family, founders of Hyundai, have misappropriated hundred of millions of dollars. There is even talk of embezzlement. The elder Chung, chairman of the company was arrested, and the younger Chung, the president is being investigated, including most of the company’s top executives. This is not the first time Korea has blazed a trail in prosecuting VIPs.

It is clear that intimidation is not in their vocabulary. Like us, family ties are quite strong in Korea. It seems that the scandal has its roots a few years back, when the Chungs set out to be big time suppliers of their own company, Hyundai. They supplied auto parts and even went into car assembly and cornered lucrative contracts from both Hyundai and its sister-company Kia. Although founders of the company, they still had shareholders that had significant holdings in the companies. Apparently, because of these lucrative contract the Chungs’ investments appreciated to a whopping $1 billion, from only $5 million. You can see why this has created a lot of interest. But investigations continue, and many predict that indictments will soon follow.

The Enron debacle in the US is also a shining example of this. While the two top executives of Enron tried to hide behind the legal cloaks, US prosecutors unearthed documents upon documents of unethical practices and hit them with "creative or aggressive accounting," overhyping of the stocks; overhyping of prospects for unproven business, etc. The conspiracy managed to topple America’s seventh largest company, and the fallen CEOs are largely expected to do time behind bars. The saga continues but there is no doubt in Americans’ minds that when the trials end in Houston, some heads are sure to roll. Such is American justice.

When we can finally claim this compliment for ourselves, we will be able to thumb our noses too and say to the foreign investors wary of setting foot on our soil – hey, we do fair business. Come test our waters. There are still a number of military officers who are presently slugging it out in the Sandiganbayan for crimes on corruption, BIR employees who have failed lifestyle checks dismally, and other government officials who have been brought to court. How many of them will eventually buy their way out? The sacrificial lambs are always those lowest in the totem pole, but I guess their families will be well compensated. Consuelo de bobo.

All the fuss about what?

I brought the family to watch The Da Vinci Code at the Powerplant cinema in Rockwell upon the invitatioin of Prestige Cars’ Maricar Parco. Media friends were there to lend support to the affair and, of course, to watch the much-ballyhooed movie. After watching it, though, I came out of the theater wondering what all the fuss was about. As Tom Hanks said, the key to the enjoyment of the movie was in one word – fiction. The sooner you realized that, the easier it would be to sit back and enjoy fine acting ability of Tom Hanks as the Harvard professor fascinated with puzzles. I support a "For Adults" classification though as there’s always the possibility of affecting young minds – a possibility. But otherwise, one doesn’t need a well-rooted faith to take the movie as it is – a movie meant to entertain.

Before the movie, the audience was presented with a rare visual treat – different BMW models at their trendiest, each designed and engineered with technology that has made BMW a major player in the luxury class.

According to Maricar, Prestige Cars has quite a line-up of good movies, as a treat to media friends and patrons who have been loyal to Prestige Cars, the local authorized dealer of BMWs. We’ll certainly watch out for them.

Mabuhay!!! Be proud to be a Filipino.

For comments: (e-mail) businessleisurestar@stv.com.ph