The natives are restless

Everybody is talking about two things in Metro Manila. The first is the exorbitant cost of electricity and second the unbelievable and unacceptable declaration of the PNoy administration that they are powerless to do something about it. People are evidently not interested in hearing the administration’s legal reasons for their inutile state of being. The natives are more than restless, they are angry and they don’t give a damn about politics, all they want is for the immoral cost of electricity prices to be corrected.

Personally, I suspect that the barkadang PNoy are simply assuming that people will get used to having no choice but to pay the prices and will eventually move on to watching telenovelas. Some PNoy suck ups may also assume that those making noise are just small consumers who don’t have a real say in matters so Malacañang does not have to worry about jungle drums beating a war chant.

Maybe not, but the investors have started to pound on their chests and a few dinner tables as well. Yes they are mad and they are obviously no longer keeping their mouths shut. Their companies are losing money not because of bad business but because big chunks of what should be their profit are being eaten by the power companies. In their minds they are now working for the power company first, then the Philippine government that has a significant earning from the sale of electricity, and then the BIR comes in for its share of their “profit” and only then can the businesses taste their hard earned leftovers.

In 2013 alone, a number of businesses I know had to pay an additional cost of P500,000 to P700,000 a month in operating costs due to higher electricity costs. Last month’s power rate hike cost them an additional expense of P1 million to P1.5 million just for the month of December. December should have been “the last hurrah” for business establishments hoping to generate 15 to 30 percent of their total revenues for the year. Instead of the hurrah, they are now screaming curses at the “indifference”, “incompetence”,  “blabber mouthing – “Inutile government” of Noynoy Aquino.

In a very random and jungle style survey, several business owners told me that earnings last year (2013) were down by 12 to 20 percent compared to the previous year.

To make matters worse, even foreign executives have openly been critical or complaining about the lack of leadership and commitment on the part of PNoy to sustain the investment climate in the Philippines.

One thing that investment advisers and experts always tell government is that there must be a high predictability of doing business in the country if we want investments and jobs to grow. Business just like government, operate on a set of assumptions that are based on technical and financial data. This becomes the basis for setting operating budgets as well as earnings and profit forecasts. Investors and businesses are in it to make money unlike the government, which almost always loses money but is never accountable for it. Unlike President Noynoy and his cabinet who gets to finish their term whether we like it or not, most business executives have no job security and will get fired for missed targets or goals whether it’s their fault or not.

A top executive of foreign firm told me how foreign shipping firms have imposed an additional “US$ 250” for every container they bring to Manila in the last quarter because of delays in off-loading and turn around for the ships. Part of the problem was containers were stuck at the pier because the MMDA had imposed an expanded truck ban during the holidays. The company concerned ended up with 110 containers delayed and that does not even account for lost opportunities and lost money on rentals and wages. All told, the company lost millions. That would piss off anybody, but the Barkadang PNoy have slowly revealed that their administration is part “Vulcan” like Mr. Spock. They don’t show emotions, which in itself is not too bad if they actually manifested the exceptional character of Vulcan logic and intellect. But they don’t. Instead they have the social and communications skill of Mr. T.

The “student council” inside Malacañang may choose to ignore the “winter of our discontent” or in true character wash their hands as Pontius Pilate did, but things will only get worse as reality sets in in 2014. Many bubbles are likely to burst this year and with them a lot of jobs, money and what should be a bright future for the Philippines.

A number of “investment players” have warned us to stay away from buying a condominium or run the risk of seeing the bubble blow up in our face. Tourism executives have expressed misgivings about the growth potential of Philippine Tourism because of the continued failure of the DOTC and now the Department of Energy to create a positive climate for business. Several businessmen have shared how they have been forced to compromise with corrupt BIR officials rather than face the music being played by BIR Commissioner Kim Henares that could be TAPS or a funeral song. The clearest sign that the administration has lost influence or control is when 2 motorcycle cops with no license plate go through EDSA Ayala tunnel with sirens/ wang wangs blaring to escort to while vans with plate # NEO 519 and ZRU 934. All this in front of commuters including a German executive who reports seeing the same caravan twice.

Just like EDSA, “Ang Daang Matuwid” of PNoy is now full of holes and we’re in for a rough ride.

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