Fil C. Sionil
A round of golf, the weather disturbance, earthquake, brownouts, and lack of water supply, in my book, are great equalizers. Four of the five affects everyone, cuts across all sectors, moneyed and otherwise.
In a round of golf no matter the position you hold – bank president, owner, CEO of a business empire, or an ace player, if your swing, drive, and putts don’t sync, a regular and/or a newbee player can outdrive you or even register a better score.
As a golfer, former Cabinet secretary Jose Rene Almendras can fully relate to this situation. As a consumer, he likewise, understands the negative effect on the daily routine of the people with the lack of water supply, including ways of doing business. He, though, is currently in the woods. It’s not him but it’s the company he steers. After serving the national government for six years, Mr. Rene is wearing his old hat as the head honcho of Manila Water Co.
The operation of Manila Water along with Maynilad Water Services is under close scrutiny. The ruling of the Permanent Court of Arbitration in Singapore piqued the sensibilities of the authorities. The Department of Justice report that some of the provisions in the 1997 contracts entered into by the concessionaires with Metropolitan Waterworks and Sewerage System (MWSS) described as “onerous” and disadvantageous to the consumers further aggravated the situation.
Based on documents gathered, rates are “adjusted every five years to ensure” the amount that Manila Water collects from the consumers is only equal to the cost that should be reimbursed to Manila Water. Additionally, its “income is set by MWSS on its money used for costs efficiently and prudently incurred” as determined by MWSS. Simply put, MWSS scrutinizes before approving any rate adjustments.
Considered agents and contractors of MWSS, concessionaires are granted the right and obligation to manage, operate, repair, decommission, expand, and refurbish the facilities in their respective service area; implement tariff rates set by MWSS; bill and collect on behalf of MWSS for water and wastewater service within the service area; and absorb the US$1-billion debt of MWSS, which is settled through concession fees.
Domestic water rate at 30 cubic meter consumption showed Baguio City consumers pay the highest at ₱1,237 while the cheapest is Davao at ₱467. Consumers in the east zone areas serviced by Manila Water pay ₱504. Those in the West zone serviced by Maynilad pay ₱745.
Comparably among its regional peers, based on 15-cubic-meter consumption, Singapore charges the highest at $1.42, followed by Tokyo at $1.05; Beijing, $.055; Jakarta, $0.43; Hanoi $0.30. Manila Water charges $0.27 and Maynilad, at $0.41.
A review of the concession agreement is forthcoming. The intention is noble. Going back to the negotiating table calls for prudence. It will be a tough balancing act to avoid any misconceptions outside, considering the country is in tough competition to incentivize foreign investors to come in.
On investment, we heard from the business community that Chinese businessman Kim Wong is investing in the posh Manila Golf and Country Club. As of this writing, Mr. Kim’s purchase of a playing right in the most elite golf course in the country is still being deliberated on by the membership committee. His acceptance still hangs. World boxing champ Manny Pacquiao’s Manila Golf membership after careful deliberation was “blackballed” in 2011. The share price back then was only ₱26 million. Now the current trading price has gone up by 200 percent to a hefty ₱78 million.
The wheels of business churn, not almost always, to the value of the money.
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