Less-than-ARMM Bangsamoro is bad for business, “leads to very uncertain future”

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COTABATO CITY (MindaNews / 29 June) — Uncertainty is bad for business and the business sector in the Autonomous Region in Muslim Mindanao (ARMM), expectant of a better deal in the future Bangsamoro — the new autonomous political entity that would replace the ARMM — wants Congress to know that a “less than ARMM” Bangsamoro is bad for business.

Basilan-based Dr. Rima Hassan, chair of the ARMM Business Council, the umbrella organization of business chambers and trade associations in the region, said the ARMM Organic Act “must be the baseline for any BBL that will be passed.  Otherwise, the consequences are too horrendous and drastic for the business community and the regional economy in general.”

At the forum Tuesday on “BBL and Business: Implications of the Senate and House versions of the Bangsamoro Basic Law on the business sector,” Hassan explained that while they welcome the passage of the BBL, they are “also apprehensive what kind of BBL will emerge from the legislative mill.”

Dr. Rima Hassan, ARMM Business Council Chair says the Organic Act of the ARMM s”must be the baseline for any BBL that will be passed” or the consequences would be “too horrendous and drastic for the business community and the regional economy in general.” Photo courtesy of RBOI

“Will the BBL that will finally become law be better than ARMM? Under Bangsamoro, will we have to change how we currently do business in the ARMM?  What are the policy risks and uncertainties of doing business in the Bangsamoro if the BBL is less than ARMM?” Hassan asked.

Members of the Bangsamoro Study Group — lawyers Naguib Sinarimbo,  Raissa Jajurie and Maria Asis — and the ARMM’s Regional Board of Investments (RBOI)  chair Ishak Mastura gave the business sector a preview of the Bangsamoro that will be established based on their study of the provisions in the versions of BBL drafted by the Bangsamoro Transition Commission (BTC), the Senate and House of Representatives.

They also studied provisions of the 1987 Constitution, the 2014 Comprehensive Agreement on the Bangsamoro (CAB) signed by the government (GPH) and the Moro Islamic Liberation Front (MILF) and RAs 6734 and 9054,  the Organic Act of the ARMM. (see other story)

The forum was organized by the RBOI precisely to address concerns raised by the business sector in the five-province region comprising Maguindanao, Lanao del Sur, Basilan, Sulu and Tawi-tawi and the cities of Marawi and Lamitan, and those from outside who are interested in investing in the ARMM, the core territory of the Bangsamoro.

Mastura explained that a “less than ARMM” political entity, will “create major policy uncertainties,” will cause “chaos and confusion.”

He said investors, particularly foreigners, place a high premium on clear lines of authority and decision-makingbut the Senate version deleted the power-sharing provisions in the BTC-drafted BBL and inserted a provision “subject to national laws and regulations,” while the House of Representatives transferred several proposed exclusive powers of the ARMM to concurrent with the central government, including those that are already exercised exclusively by the ARMM.

“Real world consequences”

Mastura cited examples of “real world consequences” of passing a BBL that is less than ARMM. He said they had raised similar concerns in 2015, while the BBL was under deliberation (no BBL was passed under that administration which ended on June 30, 2016).

Mastura recalled that the PhP 1.5 billion EA Trilinktelecoms and submarine cable project in 2015 did not push through “after the policy uncertainties of the passage of BBL at that time spooked the Malaysian investors and the project delays pushed the cost of the project to uneconomic levels.”

Lawyer Ishak Mastura, chair of the Regional Board of Investments, says a Bangsamoro political entity that is less than ARMM will “create major policy uncertainties.” Photo courtesy of RBOI

Telecoms projects get their franchises from the ARMM’s Regional Legislative Assembly (RLA).

This year, Mastura said, another telecoms project, the P3.0 billion project of TierOne Communications, Inc. (Tier1) already rolled out some of its provisional and demonstration effect signal towers.

Tier1, the region’s top investor in 2017, will provide cellular services, broadband connectivity, wireless internet, and public WiFi. It was supposed to have targeted Marawi City as pilot area but because of the siege, moved to Cotabato City.

“Tier1 asked us what will happen to their franchise and how will they operate if Transportation and Telecommunications are now Reserved or Concurrent powers and if subject to national laws, do they have to apply for a separate permitting and licensing process with the national government?” Mastura narrated.

Mastura did not say how he responded to Tier1’s questions. When MindaNews asked him how, he replied: “We told them nothing is certain yet.”

The company’s franchise, he said, was granted by the ARMM’s RLA,  and is good only for 25 years.

In the Senate and House versions of the BBL, when the franchise expires, the Bangsamoro parliament has no power to renew it, he said.

Among the options the company can have, Mastura said, is to buy or partner with a company with a national franchise “just to be safe.”

“For the moment, they have vested rights under the RLA franchise but if it expires,  then their partners’ national franchise would have to do. Companies adapt to change but it will add costs to them such as buying or partnering with a national franchisee,” he added.

Muslim Mindanao Act 202 granted Tier1 a 25-year franchise to “establish, construct, install, work, maintain, upgrade, manage and operate networks to provide local and international telecommunications and broadcast services into and out of its franchise region in the Philippines.”

Tier1 enjoys a 10-year exclusivity in the franchise area.

“Very uncertain future”

At the end of the presentations in the forum, Midtimbang Gubar, Legal Officer of the Matling Industrial and Commercial Corporation, said “mukhang talo” (looks like we lost) and proposed to fellow participants to pass a resolution and submit this to the Bicameral Conference Committee (bicam) that would come up with the final version of the BBL, “to express our sentiments about this present situation” particularly on the return to the national government of powers already granted to the ARMM.

Among those in the audience at the Al-Nor Hotel’s Nursalam Hall was Cielito Habito, Socio-Economic Planning Secretary and Director-General, National Economic and Development Authority from 1992 to 1998.

Habito said the passage of the BBL has been identified to be “one of the key drivers of the future of this region” but he cited a  disturbing scenario that was painted in their scenario-building exercise held in the same city earlier that day on “what happens if BBL is actually passed and even endorsed in plebiscite but is rejected by the parties that matter — the MILF and MNLF (Moro National Liberation Front)?”

Former Socio-Economic Planning Secretary and NEDA Director-General Cielito Habito warns of “very uncertain future” if the final version of the Bangsamoro Basic Law is “ARMM-minus” and says the challenge is to “try to see how people can work together, especially you the stakeholders, so that the desired outcome can still be salvaged somehow.” MindaNews photo by CAROLYN O. ARGUILLAS

He said that is a scenario “where there would be undesirable elements who will take over the governance of the region. Of course there will be a new Bangsamoro government kaya lang nga ang primary proponents nasa labas kasi ayaw nila precisely because of these terms, and then it may open the gates for opportunism and unfortunately, for the wrong elements asserting leadership, and well, like it or not, mukhang ang patutunguhan niyan is not exactly something palatable to all of us.”

“The challenge is to try to see how people can work together, especially you the stakeholders, so that the desired outcome can still be salvaged somehow,” Habito said.

“I also feel with you in pointing out that hindi naman talaga dapat mangyari na ARMM-minus ang magiging resulta ng basic law na ito but it should really be ARMM-plus, di ba? That was the whole idea,” he said, adding it is “rather disturbing to know this is where the state of things is and it leads to a very uncertain future.”

“This is a challenge, maybe an opportunity even for the business sector of the ARMM to let your voices be heard kasi it seems … the wrong voices are actually shaping the outcome of this policy reform through the basic law,” Habito said.

“Very diluted”

The Senate and House of Representatives last month passed different versions of the BBL and the Bicam, composed of 10 representatives from the Senate and 18 from the House, will meet on July 9 to 13 to reconcile the differences and come up with the final version of the law that is expected to be signed by President Rodrigo Duterte on July 23, the same day he delivers his third State of the Nation Address.

The passage of the BBL in the two houses of Congress came four years after the CAB was signed after 17 years of peace negotiations (1997 to 2014).

Al Haj Murad Ebrahim, chair of the Moro Islamic Liberation Front, talks about the Bangsamoro Basic Law versions that the House of Representatives and the Senate passed last week in a sit-down interview with MindaNews late Thursday afternoon, June 7, 2018, in the MILF’s Camp Darapanan, Sultan Kudarat in Maguindanao. MindaNews photo by MANMAN DEJETO

But the two versions have been criticized as having “mangled,” “massacred,” “watered down” the BBL drafted by the BTC, the 21-member body tasked through an Executive Order of the President, to craft the basic law.

MILF chair Al Haj Murad Ebrahim told MindaNews on June 7 in the MILF’s Camp Darapanan in Maguindanao that the versions passed by the Senate and House are “very diluted” and may create a Bangsamoro political entity that will be less autonomous than the ARMM even as he expressed hope they can restore what they lost, during the bicam deliberations.

He said they will “exert all efforts” and decide after the final version comes out, in consultation with the Moro people, if they will accept or reject it.

Murad added there are many provisions in the BBL that were changed which “resulted to violation of the (CAB)” and new provisions introduced that were not in the agreement or the ARMM but which “substantially watered down yung concept, the very concept of self-determination.”

More questions

“Hassan cited “real consequences to business and the regional economy of a watered down BBL,” explaining that most of those in the business sector in the ARMM “are still grappling with or are still recovering from decades of conflict that have made doing business in ARMM, frankly challenging and difficult.”

She noted how investments picked up in the region after the Framework Agreement on the Bangsamoro (FAB) and CAB were signed in 2012 and 2014.

Forum on BBL and Business: Implications of the Senate and House versions of the Bangsamoro Basic Law on the business sector, at the Nursalam Hall, Al-Nor Hotel, Cotabato City on 26 June 2018. MindaNews photo by CAROLYN O. ARGUILLAS

Last year, the RBOI approved PhP 3.2 billion worth of investments, 53 percent higher than PhP 2.11 billion in 2016.  This year, Mastura said they have approved 1.3 billion worth.

Luigi Piccolo Peña,  General Manager of the Bangsamoro Terminal Services Incorporated (BTSI) asked what will happen to them if the national government takes over. “Hindi ba namin ma-avail yung perks? Anong mangyayari?”

The firm registered with the RBOI in January this year under a pioneer status as cargo handler. It has also just signed an extension contract with REZA (Regional Economic Zone Authority) and Port of Polloc as exclusive port handler.

Like other business executives who attended the forum, Antonio  Santos Jr., Chief Operation Officer of Power Up Ventures, Inc. did not expect that the versions passed by the two houses of Congress would be less than ARMM.

“To be honest, my perception was, at the very least it would be ARMM Better. I was not really expecting na ganito yung situation,” he said, adding that as a businessman, “one of the traits that we want to acquire is clairvoyancy, meaning we can see the future. which we cannot, and secondly, what we want as a businessman is consistency … alam namin kung saan papunta like with our contracts, with our incentives.”

Businessmen, he said, avoid “ambiguity or uncertainty.”

A “wait and see position” may be resorted to but he raised a similar concern cited by fellow businessmen operating in Polloc Port: “our family and our company are already investing in Polloc port.”

“May future pa ba?”

Bai Sandra Siang, President of the Muslim Chamber of Commerce and Industry of Kutawato summed up what she learned about the versions as “really frustrating.”

She said uncertainty of policies affects the business environment. The prospect of transacting with national agencies again, instead of the ARMM, will make it even more difficult, she said.

Bai Sandra Siang, President of the Muslim Chamber of Commerce and Industry of Kutawato summed up what she learned about the BBL versions of the Senate and House of Representatives as “really frustrating.” MindaNews photo by CAROLYN O. ARGUILLAS

“In terms of tax holidays na gina-grant ng ARMM sa ngayon, yun ang talagang  maka-attract sa investors ngayon. Kung mawalawa pa yun, ano na lang matitira sa atin? It’s really frustrating on our part to say na ganon ang version,” she said, as she urged the audience to take a chance by raising their concerns to the bicam collectively, through the resolution. “Kahit anong chance man mayroon, then let’s do it,”

Samrah Karon-Patadon, a development worker, wants to know if the Bangsaoro still has a future in the final version of the BBL because in the House and Senate versions, “kulelat ang Bangsamoro” (the Bangsamoro is pitiful).

“May future pa ba?” she asked.

She also wants to know if provisions already deleted by the House and Senate can still be resurrected in the final version and what the Bangsamoro can do “para po magkaroon ng pangil, may paa, may kamay, may mata, may ulo, kasi sa itstura po ng pinasa nila aa version ay hindi ko na sasabihin kung anong itsura” (so it can have teeth, feet, hands, eyes, head, because I cannot describe the face of the Bangsamoro in the versions that they passed).

ARMM Executive Secretary Laissa Alamia said the business sector should not be discouraged. “Each one of you can actually call your congressman and senators you know or submit letters saying you don’t want these provisions removed from the original BTC-BBL.”

She also asked them to “encourage your friends who are sympathetic to the Bangsamoro” to also raise their concerns with the House and Senate representatives to the bicam, to “give the Bangsamoro a chance.”

“Plus of course prayers,” she added.

“Nakaka-frustrate, yes, but we should not stop lobbying for it,” Alamia added.

The ARMM is deemed abolished once the BBL is ratified in a plebiscite. (Carolyn O. Arguillas / MindaNews)

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