Import/Export Informative Forum

Here's my Welcome Remarks during the Import/Export Informative Meeting held at the Subic Bay Exhibition and Convention Center (SBECC) last May 14, 2013.

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Good afternoon!

Bureau of Customs Deputy Commissioner Prudencio Reyes Jr, Subic District Collector Atty. Adelina Molina, E-Konek representative Fernando Ancheta, distinguished guests, locators, teachers and students, ladies and gentlemen.

Welcome to the first ever Import/Export forum between the Bureau of Customs and Subic Freeport stakeholders. Thank you to the Bureau of Customs, E-Konek, SBMA, and other related organizations for granting us their presence in this special meeting.

As the forum title says, this is an Import/Export Informative Meeting. We are not here to bang heads against each other; we are not here to point fingers; we are not here to vent out—or at least we will try not to. We are here so that all sides, the Bureau of Customs, SBMA, service providers, and locators, can understand each other better. I am, thus, quite surprised that some of the original speakers that we invited to this forum are quite petrified to join the Q&A forum. Many of them backed out.

But see, the main problem is that tariffs and customs regulations are not easy to understand. That is the reason why we even have college courses specific to this area of knowledge. If it’s tough for business people to understand a lot of it, what more for ordinary citizens? With globalization, it is not uncommon anymore for individuals to purchase goods from other countries, and very conveniently so, through ecommerce websites. It’s even fun—until the package hits the Bureau of Customs. Then trouble begins.

Not a lot of people understand that taxes have to be applied to goods purchased from other countries. Just look at the Bureau of Customs Complaints page on Facebook? Yes, they do have it, with the intention of helping people out. Unfortunately, the majority of complaints are about matters emanating from the simple fact that they are not aware of Customs regulations.

We can argue that many of the information are not available to individuals. I beg to disagree. Again, it’s on Facebook; you just have to go to the Philippine Customs Duties and Taxes page, and it will show you how to calculate Customs taxes for a number of items. How to compute customs taxes for imported items like apparels, vehicles, how to compute for excise taxes, and more. The information is there. And with today’s digital world, you don’t even have to get up your seat to learn how things work.

So what is the problem?

The crux of the matter is that all those information is overwhelming. It is overwhelming for many companies, and certainly overwhelming for individuals. So overwhelming that a lot of companies that do large scale importing and exporting hire brokers to take care of their transactions. Unfortunately, just like other regulations and procedures that are inherently complicated, fixers abound.

And we do not have to be coy about it, some “fixers” are from inside the Bureau of Customs even. These people give the Bureau a bad rap. Like many other government organizations, you have both good and bad apples. President Aquino himself wants the bad apples rooted out.

But we have to admit also that this problem is not isolated to the Bureau of Customs. A good number of businesses are also dishonest. Okay, let’s call a spade a spade and call some of them smugglers. Good apples, bad apples.

The good thing is that Commissioner Ruffy Biazon, as represented here by Deputy Commissioner Reyes, and the good apples in Customs are starting to make a difference. We will help them out. We will even do it from within our ranks, as we have recently done albeit on a somewhat different issue [waste dumping].

One way to do it is to understand better some of the more complicated procedures of the Bureau of Customs; to question why some things seemed unreasonable; and for the Bureau of Customs to patiently explain why some things need to be done a certain way. This is what this forum is all about.

The Subic Bay Freeport Chamber of Commerce is hopeful that this meeting can be a starting point for more dialogue, more transparency, and not only better, but right way, of doing business. That is what the essence of President Aquino’s speech during the 110th Anniversary of the Bureau of Customs last year. The Subic Chamber is one with him; we are one with Commissioner Biazon, Deputy Commissioner Reyes, and the good apples of the Bureau of Customs. We will run after the bad apples within our ranks, too. The reforms in the Bureau of Customs is starting to bend the crooked road into a straight path—into daang matuwid.

We will help make that happen.

Thank you!

Closure on the Waste Dumping Issue

More than four months after it was first reported, closure on the waste dumping issue seemed at hand.

Okay, for those just coming out of hibernation, Glenn Defense Marine Asia Philippines (“Glenn Defense”), a US Navy contractor and member of the Subic Bay Freeport Chamber of Commerce (“Subic Chamber”), was alleged to have dumped ship waste into waters abutting Subic Bay. This issue hugged the frontpage of newspapers for several weeks, prompting investigations by a number of government agencies. It even prompted a Senate inquiry.

For its part, the Subic Chamber issued a membership suspension to Glenn Defense a few days after the initial report.

We have a case on our hands, and we need to know if indeed, violations were committed or not, and what to do with Glenn Defense’s status of SBFCC membership either way.

We conducted a thorough investigation of our own, including the commissioning of additional laboratory analyses. This culminated in a report on 2 December 2012 titled, “INDEPENDENT INVESTIGATION FINDINGS of the Subic Bay Freeport Chamber of Commerce In Relation to the Alleged Waste Dumping by its Member, Glenn Defense Marine Asia Philippines Inc.”

The report was sent to all Chamber members and is still available in downloadable PDF format in our online forum. The Philippine Senate and the US Navy both obtained copies of the aforementioned report. In fact, some members of the Subic Chamber’s Environment Committee were even invited to the Senate inquiry as resource persons.

The Senate committees in charge of the investigation, the Committee on Environment and Natural Resources and the Committee on Foreign Relations headed by Senator Loren Legarda, completed their investigation in early February 2013. It found that Glenn Defense violated the country’s environmental and marine protection laws. She also scored the lack of coordination and inaction of responsible government agencies (see page 6 of SBFCC Newsletter for details).

The Subic Chamber finds the Senate report very comprehensive and leaves no doubt that violations were committed by Glenn Defense. It hits the nail right on the head, too, on the lack of coordination between different government agencies with regards to the issue. The Subic Chamber hopes that this lack of coordination will not preclude the judicious dispense of appropriate sanctions.

The United States Navy for its part, according to a Philippine Daily Inquirer news report on February 16 (see page 10 for details), has disqualified Glenn Defense from joining future bids and that, should its violations continue, its current contract would be terminated.

Consequently, the Subic Chamber, after a unanimous decision by its Board of Directors, resolved to serve Glenn Defense a letter of expulsion from SBFCC membership.

Here’s the letter:

February 18, 2013

VICE-ADMIRAL MATEO M. MAYUGA (RET)
President, Glenn Defense Marine Asia Phils. Inc.
Unit 202, 2/F, Solar Bldg, GT Complex
14A Sta. Rita St., cor. Canal Road
Subic Bay Freeport Zone, Philippines

Subj: Removal from SBFCC Membership

Dear Mr. Mayuga,

The Subic Chamber regrets to inform you that your membership with the organization has now been terminated.

Last 25 October 2012, we have sent you a letter of suspension pending investigation of various government agencies with regards to your company’s alleged waste dumping. Regrettably, the findings that came out showed violations by Glenn Defense Marine Philippines. Such violations are deemed inimical to the interests of the SBFCC due to the damage it can cause to the organization’s name. In an effort to shelter the SBFCC’s name from harm, the SBFCC Board of Directors, upon a majority decision, decided to end effective immediately the membership of Glenn Defense Marine based from Section 4 paragraph B of the SBFCC By-laws, to wit:

Section 4 - Suspension or Loss of Membership

(B) The Board of Directors shall have the power to suspend or expel any member for causes deemed inimical to the interests of the Chamber as may be determined by the Board of Directors.

We hope you understand that the SBFCC Board of Directors has the responsibility to safeguard the SBFCC’s name from potential damage and that its decision is based primarily for this reason.

This letter, however, does not preclude Glenn Defense Marine from appealing the decision of the SBFCC Board of Directors.

Sincerely,

Prof. DANNY J. PIANO
SBFCC President

Case closed.

Well, there’s still this thing about the sanctions that government agencies will mete out. But, the issue being very high profile, we expect that reasonable and appropriate decisions will be made. We will know soon enough.

New BIR Regulation on Transfer Pricing

The Bureau of Internal Revenue wants bigger tax collections—which pretty much sums up the intent of the new regulation, RR 2-2013, issued last 23 January 2013. Understandably so. That’s their mandate.

But, before you howl in protest, the regulation only applies to associated companies like those that are part of conglomerates, multinational companies, and the like, where profits can be allocated for tax purposes between the companies under a single corporate structure. In short, it’s about controlling the excessive allocation of the profit to, say, a subsidiary that is located on a country or area where tax rates are lower.

Before it gets too complicated (and boring), let’s see what the regulation and transfer pricing is about.

According to the BIR, transfer pricing is generally defined as the pricing of cross-border, intra-firm transactions between related parties or associated enterprises. These are usually multinationals.

As an example, let us take a profitable US corporation with a subsidiary in the Philippines that manufactures parts. The parent corporation buys the parts from its subsidiary. But how much should it technically “pay” for the parts? Remember, it owns the parts manufacturer which makes it possible to dictate any price.

If the parent buys the parts below local market prices, the Philippine subsidiary will appear to be in financial trouble even if the firm as a whole takes on decent profit from the final product. The IRS will obviously not complain about it since the profit will be reported on their end but what about the BIR? Their problem is that the Philippine subsidiary will report little or no profit. This is where transfer pricing comes in.

It works this way: If the US corporation in the earlier example will buy the parts from an independent supplier in the Philippines, they will be paying the current local market price; which means the supplier will likely have reasonable profit and would pay the correspondingly higher taxes. Bigger revenue for the BIR.

So back to the question: How much should the US corporation pay for the parts from its subsidiary? Obviously, the Philippine government cannot dictate that they buy from their subsidiary using the local market price for the part. This is where the arm’s length principle (ALP) comes in.

The ALP is a methodology set out by the internationally accepted Organisation for Economic Cooperation and Development (OECD). It provides the guidelines for transfer pricing.

Basically, the transfer price should be the same as if the two companies involved were indeed two independents. Well, not exactly the same price; there is some wiggle room but there are also limitations on the amount of your jiggly maneuver. If you are way off and unreasonable, you might get the BIR’s side glance and eventual attention.

In this era of globalization, many tax authorities around the world use it so that governments can have their fair share of taxes. The Philippine government is only just jumping in on the bandwagon although this was already in discussion since way back 2003.

The thing is, it may actually backfire in some cases. Multinationals may already be allocating more profits to their subsidiaries inside economic zones because of the tax incentives. If we apply the transfer pricing scheme, subsidiaries here may end up paying less taxes to the BIR and more taxes to their home country.

It’s a different story altogether for Philippine conglomerates with subsidiaries inside economic zones, though.

See, outside the economic zones, parents of domestic companies are generally paying more than 30% on corporate taxes; inside, their subsidiaries are only paying 5% on gross income. If they allocate more profits to the subsidiaries, the subsidiaries would be paying more taxes but way less taxes for the firm overall.

With the new BIR regulation, the profit allocation should be within the boundaries of the transfer pricing methodology. In short, bigger taxes for the firm to pay overall. Bigger tax revenue for the BIR as well.

And that’s generally what this new regulation is all about. Obviously, this regulation is not that easy to implement considering the many variants of business. The BIR and the OECD, though are both ready to provide assistance to implement transfer pricing in a more or less standard manner while considering each one’s particular situation.

Still here? Anyway, this one will take a while to implement in full, but something that you should really start checking up on. Remember the motto of tax authorities the world over, “We have what it takes to take what you have.”

(SBFCC Newsletter Volume 18 Issue 2)

Possible Basis of RP Energy On Contesting the Writ of Kalikasan

On January 15, the Manila Standard Today reported that the RP Energy is contesting the Writ of Kalikasan issued against it by the Supreme Court on August of last year.

It said:

Redondo Peninsula Energy Inc., the proponent of the 600-megawatt coal project in Subic, said Monday it submitted a legal memorandum contesting the writ of Kalikasan issued by the court.

RP Energy said it was awaiting the decision of the court on the case, which could derail its plan to build a coal-fired power plant in Zambales. The last hearing was held on Dec. 14.

RP Energy declined to provide a copy of the memorandum submitted to the Court of Appeals, citing confidentiality issues.

The Writ of Kalikasan is a legal remedy that provides for protection against environmental damage.

So what might be it that RP Energy may be contesting?

Here's a possibility: Section 1 on Rule 7 of Special Civil Actions (Part III) states that,

Nature of the writ. - The writ is a remedy available to a natural or juridical person, entity authorized by law, people’s organization, non-governmental organization, or any public interest group accredited by or registered with any government agency, on behalf of persons whose constitutional right to a balanced and healthful ecology is violated, or threatened with violation by an unlawful act or omission of a public official or employee, or private individual or entity, involving environmental damage of such magnitude as to prejudice the life, health or property of inhabitants in two or more cities or provinces.

The important phrase is "...involving environmental damage of such magnitude as to prejudice the life, health or property of inhabitants in two or more cities or provinces."

It would be a technicality and there could be other reasons but would it be enough basis to contest the Writ of Kalikasan?

Hopefully, the case will be decided based on merits anyway.

The 13th Baktun

Friends, here is my fearless forecast: the year 2013 would be good for the Subic Bay Freeport!

Okay, this is not based on any quantifiable economic data and stats—but simply because the Mayans said so.

No, I’m not drunk while writing this; maybe tipsy, but not groggy. Hey, it’s the holidays!

So, the apocalypse did not happen, and the world did not end; which means onward we march to another 5000 years.

Incredibly, according to a global independent market research company, Ipsos, one in ten people believed that the Mayans have prophesied the end of the world at the close of the 12th Baktun—21 December 2012 to you and me. So much so that a number of governments have told their citizens that the world won’t end. The Chinese government even had to resort to arresting people who were spreading doom and gloom.

Ironically, the Mayans said people predicted wrong and that they, the Mayans themselves, did not interpret the end of their Long Count Calendar as the catastrophic end of the world. Their calendar has simply run out, they said; nothing more, nothing less. In fact, the Mayan elders said that the correct interpretation was that the world will be transformed for the better—not end; a new beginning, a renewal, more like.

In this context, we can then look back a bit at 2012 and try to predict how things will roll inside the Subic Bay Freeport in 2013. Let’s look at the big ones.

The proposed marine cargo diversion to Subic and Batangas will be a big boon to the Subic Bay Freeport. At present, Subic’s container terminals only use 6% of its actual capacity. The Maritime Conference, organized by the Subic Bay International Terminal Corp (SBITC), a Chamber member, and SBMA, held here last August certainly helped at making businesses in central and northern Luzon become aware of Subic’s cargo potential. We hope that the recent big push by the Subic-Clark Alliance for Development (SCAD), headed by former SBMA Chairman Felicito Payumo, will at last make it happen. The container terminals were actually built during Chairman Payumo’s term as head of the SBMA.

This planned cargo diversion was long time in the making. I remember this being a regular item in the agenda of the SBFCC’s Business Development Committee during its frequent meetings with former Administrator Armand Arreza in 2011. I think it was he who made the request to the Department of Transportation and Communications (DOTC) to fund the Japanese International Cooperation Agency (JICA) study. In fact, the Subic Chamber is one of the first organizations the JICA talked to, in November 2011, regarding the study.

Should this push through, the year 2013 will certainly look promising to the marine cargo industry. It would also be a great income generation source for the SBMA.

Shipbuilding, too, is expected to continue to grow. Hanjin Subic, another Chamber member, which is now hiring more workers in addition to its 20,000 workforce, has catapulted the Philippines as the fourth largest shipbuilding country in the world. Add to that its new agreement with AMSEC, a subsidiary of Huntington Ingalls, to provide maintenance, repair, and logistics services to the US Navy, and you can very well imagine how huge this can be starting 2013.

Hanjin, in collaboration with the Home Development Mutual Fund (HDMF or Pag-Ibig) has even started building 1000 housing units in Castillejos for its workers, the biggest single housing project in the country today.

Shipbuilding in the country is so successful in stimulating the economy that the Department of Trade and Industry (DTI) has even invited nine Japanese shipbuilders to expand and set up operations here in the Philippines. It is now one of the government’s preferred industries under the Investment Priorities Plan (IPP) plan where a ton of perks and incentives are given to new entrants.

The Subic Bay International Airport is another one that is starting to show promise. Not only is general aviation seemed to be booming as evidenced by the success of Chamber member Aviation Concepts, it looks like there is a chance that a carrier, Astro Air International, might actually start its Subic-Taipei and Taipei-Boracay flights soon.

The increased VFA exercises is also seen as another activity that is expected to stimulate further the economic activity within the Freeport and surrounding areas. While regrettable that it has to happen because of the Scarborough and Spratly issues, we’ll take what we can. The end of the world has already passed anyway. The Subic Chamber has even formed a VFA Committee, headed by Joe Guthrie, to make sure to follow events as they unfold.

I predict, however, that it will be tourism that will shine brightest in 2013. It already did very well in 2012 despite all the ruckus on environment-related issues. The Department of Tourism (DOT) has even declared the Subic Bay Freeport as the “Premier Convention Capital of Central Luzon,” due mainly to the Subic Bay Exhibition and Convention Center (SBECC).

The SBECC, formerly the GVC Manufacturing building, was renovated around 2007. I vividly remember Armand Arreza telling me and John Corcoran, who was then the SBFCC President, when we visited the place while construction was going on, that he hopes it does not turn into a white elephant. A few months later, the 20th Ad Congress, the biggest event in the advertising industry, was held there and that started it all. It was one of the successful projects of SBMA and certainly one that helped spur tourism inside the Freeport.

While I am happy with the DOT declaration, I think that was a very modest and conservative pronouncement because the SBECC certainly rivals the Philippine International Convention Center, the Convention Center in Cebu, and even the World Trade Center in Manila. It is bigger than any of the three, truth be told.

Not only the SBECC, I was quite impressed, too, with how the SBMA’s Tourism Department, headed by Raul Marcelo, brought in and organized a good number of tourism events that continues to put the Subic Freeport on the map. I am so impressed with this department’s performance that when our good friend Susan Dudley gave notice (no, not because of the purported apocalypse), I had to scout from the tourism sector and found Donna Tamayo, a long-time acquaintance and now the Chamber’s Executive Director.

I am fairly certain that 2013 would be a banner year for tourism in the Freeport. Add to that Harbor Point, the newest and biggest mall in this area; possible airport commercial and general aviation flights; the likely completion of the Subic golf course; the scheduled renovation start of the Golden Dragon Resorts and Casino (former Legenda and newest Chamber member) this year; and then the completion of the Tarlac-Pangasinan-La Union Expressway (TPLEx) by middle of this year, which extends the SCTEx even more closer to Baguio, and you’ve got the perfect recipe for success.

Sure, we have our share of problems—smuggling and waste dumping to name a couple—but those will probably make us stronger, more alert, and learned. Two issues also: the CUSA and the Writ of Kalikasan on the coal-fired power plant, are both still in the courts. A decision on the latter will probably come out by next month while the former might take a bit longer. But, whatever the decisions of the courts will be, we can simply move on and continue to build the Freeport.

Incidentally, the ancient Mayans used a base-20 counting system (we use the decimal base-10) where a Katun translates into something like 20 years; and where 20 Katuns make for one Baktun. Their latest Katun ended at just about the same period as the 20th anniversary of the Subic Bay Freeport... and then it renews. Coincidence?

Yes, I agree with the Mayan elders that 2013 means a renewal. Yup, the 13th Baktun, it’ll bring forth prosperity, not upheaval.

Okay, that’s a pathetic wax poetic. But who cares. The world did not end. Happy New Year!

(SBFCC Newsletter Volume 18 Issue 1)

Independent Investigation Findings of the SBFCC In Relation to the Alleged Toxic Waste Dumping

The Subic Chamber released on 2 December 2012 its findings titled, "Independent Investigation Findings of the Subic Bay Freeport Chamber of Commerce In Relation to the Alleged Waste Dumping by its Member, Glenn Defense Marine Asia Philippines Inc.

It is quite a read at 17 pages but below is the Executive Summary. The full text can be downloaded from the SBFCC Online Forum.

EXECUTIVE SUMMARY

On 15 October 2012, a hazard call was received by the SBMA Ecology Center. It was later found that MT Glenn Guardian, a vessel owned by Glenn Defense Marine Asia Philippines Inc (“Glenn Defense”), dumped waste on Philippine marine waters. It was alleged on various media reports that the waste was dumped within the confines of Subic Bay, and that it was toxic. It was further alleged that Glenn Defense had no necessary government permits to dump waste and was said to have invoked immunity through the Visiting Forces Agreement (VFA).

Glenn Defense is a member of the Subic Bay Freeport Chamber of Commerce (“Subic Chamber”). It’s CEO, Retired Vice-Admiral Mateo Mayuga, is also its official representative to the organization.

The Subic Chamber, in its desire to safeguard the name of the organization deemed it necessary to conduct an independent investigation. Its Bylaws state that the Board of Directors shall have the power to suspend or expel any member for causes deemed inimical to the interests of the Chamber; obviously, only after thorough examination.

The initial investigation found prima facie evidence that there could be truth to the allegations. Glenn Defense was, thus, suspended by the Subic Chamber on 25 October 2012.

The Subic Chamber investigation continued and while not yet concluded with finality pending continued investigations by government agencies, the following interim findings were established:

1. The Glenn Defense vessel, MT Glenn Guardian, hauled 50,000 gallons of domestic waste from USS Emory S. Land, and this waste was discharged on Philippine waters.

2. The waste was likely dumped far outside the confines of Subic Bay, but the dumping was performed on an unlawful manner.

3. On whether the waste was toxic, DAO-35 has clear parameters whether to consider waste as toxic or not. Negative results on parameter tests commissioned by the Subic Chamber clearly indicate that the untreated waste from the US Navy ship was, according to DAO-35, conventional pollutants and not toxic and deleterious substances.

4. The waste was likely dumped outside Philippine Territorial Waters but still in violation of Philippine laws since the Philippines has jurisdiction over its exclusive economic zone.

5. Glenn Defense violated MarPol and Philippine Coast Guard regulations.

6. Glenn Defense does not have the necessary permits to haul and dump wastewater at sea.

7. Glenn Defense is not covered by the Visiting Forces Agreement (VFA).

The rationales for the above findings are described later in this document [full report here].

There seemed to be no question that Glenn Defense committed violations when they dumped waste absent of the necessary permits and by not following regulations. The Subic Chamber will, however, not make recommendations as to what penalties should be imposed. This is better left to concerned government agencies. The main purpose of the Subic Chamber’s investigation is to validate its actions against Glenn Defense in terms of its membership to the organization. The Subic Chamber, in any case, provided recommendations at the end of this document which, hopefully, will provide systemic solutions that might lessen the continuing pollution of Philippine waters.

Subic Bay Freeport 20th Anniversary

The week-long 20th anniversary celebration of the Subic Bay Freeport kicked off with a special flag raising ceremony last 19 November 2012.

Chairman Garcia led the actual raising of the Philippine Flag that morning, close to 20 years after it was first officially raised inside the Freeport.

At that time, 24 November 1992 to be exact, it was the world’s largest Philippine Flag. It was unfurled and raised by former President Fidel Ramos and former SBMA Chairman Richard Gordon to the top of a 94-foot flag pole which symbolizes 94 years of US military presence in the Philippines.

On a nice sunny morning 20 years hence, I still feel exhilaration watching the Philippine flag rise from exactly the same location and starts waving on the way up, urged by a gentle wind.

The day was a welcome respite, too, from the scandalous, headline hugging issue about the alleged toxic waste dumping.

Requested by SBMA to deliver a short message about the Freeport’s 20th Anniversary, I was more than happy to oblige. Here it is:

Good morning! This month, we are celebrating the Subic Bay Freeport’s 20th anniversary. But let me just quickly go back 10 more years before it all started. That would be 1982.

Where we stand now was then still part of the US Naval Base, once the largest US military naval base in Asia and home to the US 7th Fleet. At that time, I was an apprentice machinist and mechanic, 20-some years old, no gray hair, working a kilometer or so from here—just past the Dispensary. At that time, there were around 30,000 of us locals working for the US Navy. Interestingly, I still see many of those who used to work here.

If I recall right, there were two flag poles right in this area—one for the Philippine flag, and the other for the US flag. Both were raised in the morning and lowered late in the afternoon. The big difference then was that everybody stops—pedestrians and vehicles alike—during the raising and lowering of the flags.

It’s almost like a different era. I even miss the many rock & roll night clubs on both sides of the Magsaysay strip just outside the main gate.

Ten years forward, in 1992, just two years after this area was devastated by Mt. Pinatubo, the Base workers were about to lose their jobs, mine included. I was already a senior systems programmer at that time and part of PWC’s Management Department. But that doesn’t matter, all jobs, from the lowest to the highest positions were about to dissolve into nothingness. Republic Act 7227 was just enacted early in the year, but we did not even know how that can possibly replace our jobs, and how it can possibly put food on our tables. We were in despair.

I have to give it to the first SBMA Chairman and Administrator, Richard Gordon. He provided the spark that replaced misery and despair with inspiration and aspiration.

Even the succeeding administrations, in my opinion, also contributed to the growth of the Subic Bay Freeport in some degree or another. That may be arguable to some but there is one indicator of growth that would be hard to dispute—from some 30,000 workers during the US Navy time, there are now three times as many workers here. Investors everywhere, in every nook and cranny that SBMA is now fast running out of space to lease. If that’s not success, I don’t know what is.

If you asked me 20 years ago if that would even be possible, I would have said you are kidding or probably smoking pot. It is an incredible feat! It is mind boggling!

And that’s not through sheer luck either. I’ve been witness to the hard work that SBMA and Freeport stakeholders, including the Subic Bay Freeport Chamber of Commerce, have done.

Sure, it’s not utopia, far from it. The SBMA is now facing fiscal problems. But that problem is not insurmountable. The national government is getting billions of pesos from Subic Freeport collections after all.

Sure, we face other problems especially those related to the environment. But those are not insurmountable either. In the end, it will even likely make us stronger.

One can look at this progress one way or the other. The pessimists will compare the Freeport’s progress with other developed countries and will find it minuscule, trivial, and irrelevant. The optimists will compare where we were two decades ago with where we are right now—and find progress! I belong to the latter.

So today, I stand here in front of you, not only on behalf of the Subic Bay Freeport Chamber of Commerce, but also on behalf of the former Base workers, and of the locals who were born and grew up here. Let me say that I am proud of what this place has become; I am proud to be part of this accomplishment, and I am thankful to those who were here before us, and those who are now with us for being instrumental in this success.

Finally, I am certainly looking forward to what this place will become in the future. I have no doubt that a lot more are in store for us; I believe that a decade or two from now, we will look back and say to our grand sons and daughters—you know kids, I was there, and I helped build that place! ... Happy 20th Anniversary!

(SBFCC Newsletter Volume 17 Issue 12)