Philippine election: Ferdinand Marcos Jnr win prediction compels some business executives to make 'emigration plans'

From Manila's corporate boardrooms to the once-war torn provinces of the Philippines' Muslim-majority south, business owners and investors acknowledge that Vice-President Leni Robredo has the attributes of a competent steward of the economy.

Her rival in Monday's presidential election and the clear favourite to succeed Rodrigo Duterte, Ferdinand "Bongbong" Marcos Jnr, does not quite have those credentials.

"Based on Bloomberg surveys, the investors and analysts appear to favour the candidacy of Robredo, a trained economist," said Nicholas Mapa, senior economist covering the Philippine market for global bank ING.

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"Robredo is an economist by training, holding a degree from the University of the Philippines [with a] track record of honesty, as evidenced by outstanding COA (Commission on Audit) ratings for the past two years."

"Training and the image of spotless service may be what inspires confidence in would-be investors," Mapa said.

Robredo's economic expertise also got the thumbs-up from Ahod Murad Ebrahim, transition Chief Minister of the Bangsamoro Autonomous Region for Muslim Mindanao in southern Philippines, who said "we need a leader who will continue the peace process" and thus unlock the investment potential of the poverty-stricken region.

The business community, however, is aware of the fact that the odds are stacked against Robredo, who is trailing Marcos Jnr by a wide margin in election surveys. But two new opinion polls on Friday suggested Robredo could still catch up.

Some executives told This Week in Asia they were already researching possible places to emigrate to. "Depending on the results of this election, we may all migrate to either Australia or New Zealand," said a person working for a multinational firm, requesting anonymity.

Businessman Rafael "Apa" Ongpin pointed to a similar tendency in many of his friends - executives in their 30s or 40s: "They are literally looking all over the place - Canada, Australia, New Zealand - they're saying, if Marcos wins, this country isn't worth it. I'm leaving."

Ongpin said two other categories of industrialists - those invested in businesses requiring state licenses and franchises like gambling, power, transport and mining - are also dreading a Marcos Jnr presidency.

He added the second grouping comprised of businessmen who served as proxies for Marcos Jnr's father, the late dictator Ferdinand Marcos.

"All these other guys, they never gave it back. Now the Marcoses are riding into town and saying, OK, we'll take it back. They really have a huge chunk of the economy," Ongpin said.

The Marcoses are believed to have squirrelled away some US$10 billion of plundered wealth and they have never been shy to publicly acknowledge the existence of their ill-gotten gains.

In a 1998 interview with the Philippine Daily Inquirer, Imelda Marcos - the late leader's now 92-year-old wife - declared that the family practically owned "everything in the Philippines, from electricity, telecommunications, airline, banking, beer and tobacco, newspaper publishing, television stations, shipping, oil and mining, hotels and beach resorts, down to coconut milling, small farms, real estate and insurance."

Since then, the Marcoses have been filing intervention suits to reclaim these assets, which the Philippine government had subjected to forfeiture proceedings. In 2003, the Supreme Court ruled most of these holdings, estimated at around US$10 billion, as "ill-gotten".

But in 2007, eldest daughter Imee Marcos, now a senator, filed an affidavit with the Securities and Exchange Commission claiming about a third of the highly profitable broadcast company GMA-7 actually belonged to her father.

Around the same time, Marcos Jnr announced he would get back the family fortune held in trust by his father's "dummies" and start by claiming ownership of 45.4 acres in the central business district of Ortigas in Pasig City that now houses BPOs and upscale residential towers.

"He's going to claim all that equity. That's going to put kinda a damper on business" since this could potentially affect the investments of tycoons Lucio Tan, Enrique Razon Jnr, Ramon Ang, and the children of the late Jose Campos, observed Ongpin.

He added the way the late strongman seized thriving companies had not been forgotten by the business community, citing the hounding of Domingo Guevara - "a very respected, self-made industrialist" - who "didn't want to give equity to Marcos, so Marcos took him down."

"He made the banks call in the debt so his business collapsed," Ongpin said.

Domingo Jnr, 83, recalled in an interview how his father lost the home appliances manufacturing firm Radiowealth and a Volkswagen assembly company after Domingo Snr, who was elected as a delegate to the Constitutional Convention to draft a new Philippine charter, had opposed a move giving Marcos Snr lawmaking powers and making him president for life.

Domingo Jnr said all 37 members of his clan, including himself, have campaigned for Robredo, adding she had "demonstrated abilities to do the right thing at the right time for the right reason. I have seen it personally."

He said the family unity did not exist in 2016 due to political division, with him personally backing Duterte "because I thought he was going to be a great president."

The chairman emeritus of the conglomerate Guevent Group also lauded the vice-president's anti-pandemic efforts including her office sending truckloads of personal protective equipment to front liners.

Domingo Jnr added Robredo's work inspired him to chip in with donations. "Every time I send, every time, no exception, I always get a text message of thank you and a very brief summary of where the funds went."

He doubted Marcos Jnr's ability to run the government, raising the possibility of the politician "relying on close advisers who normally in most situations are there for their own personal gain and not for the country."

"And if I'm to use my kokote (brain), I think Marcos' old cronies are not going to support Bongbong simply because they know if he wins, they might just lose all their companies," Domingo Jnr said.

Global risk firm Control Risks Group offered a similar assessment in a May 6 client note. Senior analyst Dereck Aw advised clients to "reassess their exposure to legacy issues and links to companies or elite families that could fall target to Marcos's apparent desire to rectify history as he sees it."

Industrialist Ongpin, who personally knows Marcos Jnr's wife, warned growth could take a hit under the dynast. The economy will plod at a slow 2-3 per cent instead of a potential 8 per cent GDP rebound after Covid-19.

"He doesn't have the first f*****g clue how to revive the economy. He couldn't run a sari-sari (neighbourhood) store" despite a Wharton school of business background, which he did not finish. "He doesn't really seem very bright."

Marcos Jnr's personal wealth disclosure, made while a legislator, showed he had run two of his companies to the ground as of 2014.

Mapa of ING bank pointed to Marcos Snr's penchant for "profligate spending" resulting in debts that took over 30 years to repay.

He said the "Marcos era," which the front runner has promised to bring back, was characterised by "deficit" due to "massive foreign borrowings that bankrupted the economy."

"Marcos Jnr has shown the same proclivity for deficit financing, justifying its use to fund needed projects while also espousing populist measures such as providing subsidised rice that will be costly to fund," Mapa said, noting that with the Philippines' "debt to GDP ratio of 60.6 per cent, the next president can ill afford a spending spree with this kind of fiscal position."

This article originally appeared on the South China Morning Post (SCMP).

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