Housing sector gains

Vice President Jejomar Binay accepted the post of chair of the Housing and Urban Development Coordinating Council (HUDCC) and this appears to have been well received by the business sector. Binay’s acceptance of the housing czar post seems to guarantee continuity in the housing programs initiated and expanded by the housing sector under former vice president Noli de Castro.

The prevailing view is that VP Binay will just be as effective as De Castro has been in the role of “chief salesman” for the government’s housing programs. Both the new VP and De Castro have strong connection with the masses, speak their language and personify the aspiration for success of the very ordinary Filipino.

Despite rare occasions in which the housing sector was caught in the crossfire of controversies, it cannot be denied that the previous government had achieved much in this area. The housing sector was one of the few sunshine segments of the Arroyo administration, enjoying unpreceden-ted participation from both private sector investors and be-neficiaries during De Castro’s stint. Therefore, VP Binay has much positive gains in the sector to build on.

From the business sector perspective, much of the hou-sing sector’s success was triggered by the return of confidence in the government’s housing initiatives on the part of the investor and financial communities. The government cannot fund the construction of the entire housing sector target and needs the private sector to come in and invest. The banking community has to come in likewise and open its lending windows wide.

That sunny disposition on the part of investors and ban-kers was, in turn, built upon the success of a lesser-known housing sector agency called Home Guaranty Corp. (HGC) which was led by two key officials whom the business and financial communities know and trust. Former finance secretary Gary Teves chaired its board while former capital market stand-out Bong Bongolan is president and CEO.

The job of the HGC is to assure investors and bankers that the government has enough financial capability to guarantee the risks that these investors and bankers take when they put their money into the building of houses and communities for ordinary Filipinos. HGC is the answer to the skeptical approach of businessmen to the government’s social mission. The agency guarantees their risk and this assurance is the “release” button that triggers the entry of private sector funds into the government’s housing programs.

As far as we know, the past administration enjoyed unprecedented participation by the private sector in its housing initiatives but these have not been trumpeted the way other housing agencies have done with their gains. This is because Teves and Bongolan are two of the previous administration’s self-effacing personalities who will just do good but not talk much about it. But according to business sector observers, Bongolan’s solid grasp of how investors think and operate had come in handy. Bongolan was a capital markets stand-out before he joined the housing sector.

Last we heard, the HGC had a total outstanding guaranty of about P 70 billion as of end 2009. It was a mere P 25 billion in 2001. This growth of some 160 percent or almost three-fold represents the jump in private sector confidence in what the government is doing for Filipinos who dream of owning a home.

The previous administration had a brilliant sense of putting someone who understands the mind of investors to run the agency tasked to inspire enough confidence to overcome their skepticism and put their money where the government’s mouth is. VP Binay enjoys a good head start. We wish him all the best in his job as housing czar.

Is Turkish flour safe?

Philippine imports of Turkish flour have risen three-fold in the last three years and accounts for 57 percent of total wheat flour imports of the country.

But it is still small if we consider that it only accounts for five percent of the Philippines’ total wheat flour consumption. This is because we have our own flour industry that imports wheat and makes them into flour.

Used in manufacturing noodles and pastries, a 25-kilogram sack of Turkish flour costs approximately P200 less than locally milled flour.

There are those who say that the recent allegations against Turkish flour, particularly those which say that it contains mycotoxins or cancer-causing substances, may have been desperate attempts to prevent the continuing downward trend of flour prices in the Philippines caused by more and more of these cheaper Turkish wheat flour coming in.

The Food and Drug Administration (FDA) was however quick to dispel these allegations.

Last April 6, the FDA said results of its initial tests on Turkish flour samples done on March 27 of the same year revealed that Turkish flour imports are not toxic and are fit for human consumption. FDA tested samples collected randomly from retailers in Central Visayas and the National Capital Region (NCR) using the Enzyme-Linked Immunosorbent Assay (ELIZA) Method.

After the second batch of testing conducted by FDA, it issued on April 16 a public health advisory declaring once more that Turkish wheat flour is safe and fit for human consumption. It said that the results are based on the “exhaustive monitoring and analysis” conducted by FDA on the flour.

The Turkish Embassy has also said that all their wheat flour exports are in compliance with health and environmental standards such as the ISO 9001: 2000, ISO 22000 and Hazard Analysis Critical Control Point (HACCP) on quality and food safety.

Additionally, Turkish wheat flour samples are being tested prior to shipment and have been certified as safe and fit for human consumption by SGS, the world’s leading inspection, verification, testing and certification company.

Another test using the internationally accepted High Liquid Performance Chromatographic (HLPC) method likewise confirmed that Turkish flour is safe and not a threat to human health.

It is also interesting to know that Turkish flour exporters are serving the World Food Program of the United Nations, which means that Turkish flour exporters are able to meet the strict rules of the UN regarding food safety and human health.

Flour imported from Turkey has become a useful regulatory tool used by governments to provide their people with wheat flour at competitive prices, especially in countries like the Philippines where there is little or no domestic wheat production.

It was explained that aside from economies of scale at Turkish mills, the competitive price of wheat flour is attributable to Turkey’s strategic location at the center of container lines headed for the Far East which enables it to obtain competitive price quotations from transportation firms.

As ordinary consumers of wheat-based products, our concern is two-fold: that the bread or noodles that we eat are not only affordable but also safe. Right now, we are faced with two conflicting versions of the truth, but as with any assertion, what we need is proof. If the FDA says it is safe, then we hope that the parties claiming otherwise would present solid scientific evidence that it is not.

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