(During this interview, what struck me about Vicente Paterno was how he seemed to be enjoying retirement. I couldn't help but think that when I grow old, I want to be just as peaceful and contented as he is.)
The year he turned 55, Vicente Paterno underwent the big transformation from technocrat to entrepreneur. This change would allow him to redefine Philippine retailing.
The year was 1980, and Paterno had just decided to leave government after an extended stay, first as Board of Investments head (he replaced Cesar Virata when the latter moved on to become prime minister) and then as trade minister. "Too old to join the corporate world, but too young to take it easy," Paterno thought of setting up his own business. Fortuitously, his close friend and brother-in-law, Jose Pardo, was also set to quit Bancom, one of the largest investment banks at that time. It was a good opportunity to work together. Paterno's and Pardo's criteria in choosing a business were fairly simple. First, the business had to have no links with the government, whether in the form of licenses or loans. Two, it had to be in a format that was unique and new to the Philippine market. Lastly, it had to benefit from Western technology. In the end, there were just two options-agriculture or retailing. They opted for the latter.
Filling the Retail Gap
Back then, convenience stores were unknown in the country. The retail scene was not keeping up with the changing needs and lifestyles of Filipino consumers, who had to make do with what the neighborhood sari-sari store had to offer. Paterno recognized the gap and decided to bring the convenience store concept to the Philippines. In 1982, Paterno's Philippine Seven Corporation signed a license agreement with Southland Corporation, which granted him the franchise to open 7-Eleven stores in the country. With no more than P5 million in capital (the exchange rate was P14/US$), the company prepared to open two stores.
It turned out to be the worst time to open the stores. Not long after they did, opposition leader Benigno Aquino Jr. was assassinated, throwing the Philippine economy into chaos. By then, another friend, Jorge Araneta, had joined Paterno and Pardo. "We assessed the situation, but we had already gone so far. We had reached the point of no return," recalls Paterno. Unfortunately, the fledgling company was very short on capital and had to expand out of profits. Two stores, however, were not enough to generate the needed funds, so it was a Catch-22 situation.
The company struggled on until after the EDSA Revolution, when consumer spending and investor sentiment improved. The group then struck an agreement with Philamlife. The latter agreed to build stores to be run by the Paterno group in exchange for rental fees and a percentage of sales.
Even then, the business's viability remained under question, so Paterno and Pardo called on other friends, among them, Manuel Agustines of Ramcar, Benjamin de Leon of National Life, Alfred Ramos of National Bookstore, and Dante Santos of Philacor. With the additional funding, 7-Eleven stores slowly branched out to more consumers across the metropolis.
Turning the Corner
It was a slow, steady ride for the company. After it opened its eighth store, Philippine Seven turned the corner. Philamlife became an equity investor, after which the company, now a real estate and an operating firm, went on expansion mode.
In 1998, the company, with 100 stores to its name, tapped the capital markets for additional funding via an initial public offering of its shares. A bond component also allowed it to secure foreign funding.
It was a good time for the business and for Paterno, but all the success was brought into proper focus with the discovery that Paterno had cancer. "Cancer brings you to terms with your mortality," he says. "I realized I had to prepare, to put things in order." Although he emerged victorious in the fight against the disease, he made sure that Philippine Seven was slowly weaned away from him. "I told myself, Paterno, you're 75, it's not fair anymore. I could keel over anytime and I had no succession plan."
Taiwanese Partners
Paterno saw an opportunity in the then-proposed Foreign Investments Law. The law allowed foreign ownership of less than 51% in retailing under certain conditions. "This was 1999, and I could already see it coming," he says. Towards the end of that year, Paterno went to Taiwan to meet with 7-Eleven officers and offer them a 30% stake in Philippine Seven. "I told them we needed new company management, new technology." 7-Eleven Taiwan, however, wanted more than that, and in August the next year, tendered an offer for 50.4% of the company. Some of the equity partners cashed out, but Paterno and the founding shareholders decided to stay on for the joint venture with 7-Eleven Taiwan.
7-Eleven Taiwan brought more robust systems and its retailing culture to the Philippine franchise, all of which would contribute to the continued strength of the stores even in the face of stiff competition from other convenience store chains. The assimilation was so thorough that after five years of Taiwanese management, the reins were again turned over to the Filipino partners, this time, to Paterno's son Victor, who became company president. Paterno, meanwhile, stayed on as chairman, for a sense of continuity. As of September 2005, there were 256 7-Eleven stores nationwide.
"The idea of localization was timely," relates Paterno, noting that "morale went up." The cultural differences between the Filipino employees and the Taiwanese management could have prevented the optimization of employee morale. Nevertheless, Paterno says the entry of the Taiwanese partners was necessary. "We had grown from a very small operation. We were a small company for 10 to 15 years, but we needed change," he explains.
Life Decisions
Paterno reveals that the most difficult decision he had made was the one to quit Meralco to join the government. A government job meant getting just a third of his Meralco salary and giving up all the other perks. He could have also taken a World Bank posting in Washington, but "we had to make a decision for our children. What was it that the children would have wanted us to do? We wanted them raised here, but we also wanted them to have a foreign education to keep their options open. If we leave, we would be giving up on the Philippines."
Now, with the children all grown and the stint in government and business over, Paterno is a contented man. He has told his son Victor that "I won't do anything for the company unless you ask me" and is happy with going to store inaugurations and joining monthly performance reviews. At 80, his happiness now revolves around photography. There is, of course, the livelihood program that he runs in Mindanao for small businesses. He still speaks proudly of the time he won the Management Association of the Philippines award for integrity with the late Jaime Ongpin, one of his closest friends, and of the Foreign Investments Law, which he authored. "Even Nathaniel Santiago [one of the Philippine Left's leading personalities] said it was okay," says Paterno.
Of course, he also remembers his frustrations as a legislator and as a citizen. But all in all, he is happy with his life's decisions. Sums up Paterno, "I don't think that there were major decisions that were wrong in their time. You are what you are, the situation is what it is."
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Monday, May 8, 2006
People I Admire Series: Jorge Garcia
Published in Men's Zone Magazine, 2004
Jorge Garcia is probably the only top executive who doesn’t wince at money problems. “I’m having a little trouble paying off some creditors, but at least, I know I can pay my suppliers within the month,” he smiles.
Garcia, Asian Hospital Incorporation’s president and chairman, of course, is not your typical executive. While others brandish an MBA, he holds a medical degree. While others use financial calculators and hold fort in corner offices, he uses a scalpel and reigns in operating theatres. And while others look after their business’s health, Garcia looks after people’s lives. He is, after all, the Philippines’s foremost heart surgeon, bar none, and has made his mark not just in his homeland, but in the United States — his home for the past 35 years — as well. In fact, Garcia continues to play an active role in Georgetown Hospital’s heart program to this day, even as he makes fortnightly visits to the Philippines.
Garcia has enjoyed a robust and fulfilling career serving heart patients, developing heart programs that have benefited many. His success was largely the result of talent and hard work, with some luck thrown in between.
At age 34, the young Garcia, a fast-rising and highly qualified surgeon at Cleveland Hospital, had his first taste of the limelight when he was shown on national TV performing a cardiac catherization. That, though, was entirely unplanned. He recalls: “There was this man who had an angiogram and needed surgery right away. His doctor needed to move fast, and asked me to do the operation. The thing was, NBC wanted to tape the surgery.”
And so, in the minutes before former president Richard Nixon tendered his resignation, America —waiting for their president’s valedictory message — watched as the Filipino surgeon, who was not the least bit nervous, presided over what was then a revolutionary operation. “The news showed a completely arrested heart. Then I restored circulation and it started beating again.”
From then on, Garcia never looked back. The man on TV went on to develop the biggest heart program in Washington DC and the east coast, whose 3,000 annual operations is dwarfed only by Cleveland’s. His patients included US luminaries,
including Clark Clifford, counsel of the Kennedys and author of the vaunted Marshall Plan, and, more recently, Pat Buchanan, who, despite his rightist rantings, entrusted his life to a Filipino doctor and his non-white team when his own mortality came into question. “He was the only white person, along with my assistant, in the operating room,” Garcia recalled with a chuckle.
But though Garcia was content with his life and career, he somehow knew this was not enough.
An operation on a Filipino colleague in 1987 pointed him to new beginnings. He noted that his physician friend, though by no means indigent, still struggled to fork over US$33,000 for a heart bypass in the mainland. That patient told Garcia he could be in a direct position to be of tremendous help to his kababayans.
The thought never left Garcia.
By 1988, he had convinced the Makati Medical Center hierarchy to open a heart surgery program, the Makati Heart Foundation, which he headed. The good doctor would come home regularly to treat Filipino heart patients, who began to enjoy the cost advantages of having their operations done by a US professional in Manila. “A heart surgery in the US would cost around US$25,000 to US$30,000 for the hospital, plus US$10,000 for the doctor. In the Philippines, you would spend US$10,000 for everything, including professional fees,” he pointed out.
Over the years, of course, the heart program evolved. At first, Garcia had to bring in an all-American team of nurses, anesthesiologists, plus a plane load of supplies, to ensure that he could transplant the entire US system to the Philippines and train doctors and nurses in the process.
That, though, was not exactly easy to do. Instead, Garcia found himself taking Filipino professionals to the US for training on open-heart surgeries. There was just one problem: “The US guys liked them so much that they wanted to hire them.”
Garcia, who, to this day, carries a Filipino passport, has always wondered why Filipino physicians, for all their brilliance, never really excelled in their own country, but did so quite easily once abroad. He, of course, had an inkling. “In big US centers like Cleveland and Stanford, Filipinos excel, but not here. So I thought that the problem was the environment.”
And so he again began to dream, and dreamed big.
He explained: “Filipinos are easy learners, they can easily get the flow of things. So I wanted to provide an environment for Filipino professionals, where young ones can
excel.”
In 1995, he and Dr. Rodrigo Floro met with Filipino doctors in the Indiana-Chicago area to tell them that together, they could build a facility that would forever raise health standards in the land of their birth. Their pitch must have been so powerful, for doctors started writing out cheques to the amount of US$50,000 right there and then. “I must have hit a raw nerve,” Dr. Garcia muses, “because their reaction was so spontaneous.”
Their contributions served as the seed money that led to the construction of the hospital. Eventually, institutional investors linked up with the doctors, among them Insular Life, United Laboratories and Vista Holdings of Singapore.
Asian Hospital’s inception, though, was not without problems. Its construction, commencing in 1998, ran smack into the Asian crisis of 1997, which saw the peso tumbling down to 52 to the greenback from the previous 25 to the dollar. Cost overruns spiralled out of control as interest expenses soared. To make matters worse, the impeachment drama of former President Estrada started to unravel, so much so that when a British firm bought out Vista Holdings, which owned 30% of the hospital, it deliberately left out its Philippine operations.
Despite its financial problems, the 258-bed Asian Hospital still managed to open its doors to the public in May last year, with Garcia suddenly finding himself in the unfamiliar position of president.
Thrust into the veritable unknown, Garcia suddenly finds himself presiding over matters he does not exactly enjoy — managing a business, for example. “What’s this ROI? I never heard about this before,” he whines. Sheafing through a pile of reports, he says “I never dreamed I’ll do these things. My forte is heart surgery. I don’t like this. I’m not good at it.”
The marked contrast between Garcia and your run-of-the-mill executive has proven propitious, though. Unlike most executives who fidget at faltering numbers, he looks at the bigger picture — the Asian Hospital’s fundamental strengths, in this case — and asks no questions, keeping an almost child-like faith not usually seen in the business world.
Even as reports of buyouts and creditor concerns swirl about, Garcia is not at all fazed. “Our problem is only money,” he says, explaining payment arrangements made with creditors and suppliers. Besides, he points out, its doctor-investors don’t care so much about the figures businessmen regularly fret over. “Where doctors are concerned, what’s important is the survival of this hospital. We’re not interested in controlling this;
that’s where doctors are coming from. We feel very good about this hospital, and we want this project to be successful, that’s all.”
In fact, Garcia openly talks about the day when he will have to yield his post to “an expert” in the business. As of this writing, a candidate has already been identified. “He’s an expat. We wanted someone knowledgeable in running a US hospital and who has gone through the Joint Commission accreditation,” he revealed.
A Joint Commission accreditation simply means that the facility is at par with US standards, and is thus authorized to deal with the US Medicare and American insurance firms. It also serves as proof that the hospital is safe for the patients and the people who work in it. Garcia has no question that the Asian Hospital will get its accreditation, possibly within the next 18 months. “There’s no question that we’ll get the accreditation; it’s just a question of when.”
For now, Garcia presides over the hospital with much optimism. Even without looking at the numbers that regularly land on his desk, he knows, for a fact, that business is picking up. “Each day I would look out from the operating room, and I would see more cars parked outside. And now I have to wait longer for the elevator, which means there are more people inside,” he notes. He observes, too, that “there is a lot of construction going around” with 90 doctor’s offices now occupied and all 146 sold out. “Things are beginning to gel now,” he says.
Garcia takes heart in the knowledge that “people believe in my vision” — to build a first-class facility that will improve the quality of health care in the country. At the same time, he openly gushes about the hospital, calling it the “most beautiful in Asia.” He is confident that the hospital is just a harbinger of things to come. “When Shangri-La came in, it raised the bar in the hotel industry. I bet you the next hospital that will be built (in the Philippines) will be better than Asian Hospital.”
At present, Asian Hospital is decidedly the most modern facility in the country. Situated in one corner of the Filinvest Corporate City, it is surrounded by lush greenery, which has an immediate calming effect to both patients and physicians. Its modern architecture, characterized by high ceilings, glass walls, and wide halls evoke a feeling of serenity — a far cry from the antiseptic surroundings normally associated with medical institutions. Wood panels, fresh flowers and rock gardens give it a home-like feel. There are no long queues here; its lobby is not unlike a hotel’s, with the usual accoutrements, including concierge and coffee. It is worth noting that the hospital’s rates are very competitive, and its standard rooms, priced at par with the competition’s,
are definitely better appointed.
Though designed for the comfort of patients, the hospital is also a sanctuary of sorts to many Filipino doctors, an enclave where they can be themselves and put all they know to good use.
But what matters now is the quality health care, or at least, vestiges of it, is beginning to come to Philippine territory. A growing number of Filipinos, Garcia observed, are opting to do their heart surgeries here, realizing that quality cardiac care can be had in these parts. Even the surgeon elected to have his own knee surgery done at Asian Hospital. “After two days, I was already doing open heart surgeries,” he added. “ I tell you, we’re good; we’re even better.”
In fact, Dr. Garcia argues that there are many compelling reasons for Filipinos to have their medical care done in the Philippines. “We have very good nurses, we have more manpower in our ICUs, and when it comes to work ethics, we have a genuine interest in our patients.” In addition, “we have a very low infection rate despite the pollution in the Philippines.” At Asian Hospital, Dr. Garcia knows he has a “good, dedicated team, who takes pride in their efforts.”
In fact, he says, he doesn’t mind having to cross the oceans every month because “I look forward to coming here, because I feel accomplished.” That he has cut his earning power doesn’t matter at all to the surgeon. “At this point in my career, I don’t care about professional fees anymore.” He acknowledges, of course, “That there’s always a trade-off, but I’m happy about it.” He adds: “you do things that make you happy. It’s not the money or the profession. You can be a clerk, but so long as you’re happy, you look forward to going to your place of work and put 100% of your effort into it.”
Of course, his routine could be quite enervating. The fortnightly commute and 2-3 operations per day could also sap his energies. “Jet lag hits me. Of course, I suffer too.”
But all that take a backseat when he thinks of his shining moments, which are the times “when I know I was able to pull a patient out of the fire.” Thirty-five years of surgery have not at all diminished the sweet feeling of accomplishment each time he is able to bring people back from the brink. He talks about his most recent emergency operation with much pride. “I was at the lounge, watching TV Patrol. We had just finished a case so everybody was there, when we were told there was a patient who had no more blood to the heart. We did a quick operation and now he is alive,” he
relates. Seeing that the patient is now back to his daily grind, he could only feel triumphant. “You really feel good about these things,” he stresses.
He also draws a lot of strength in the realization that he has helped a lot of young surgeons in their careers. “Seeing a lot of young surgeons, many of whom were under my wing here and in the US, who try to emulate what a surgeon should think and do — that makes me feel really happy. I see I have done something good for them, and when I see their offices full, I see that I have done something good for them. I tell you, it’s a very rewarding feeling, and no trophy can replace that.”
Obviously, Garcia has a lot of things to keep him going. “I’m 61, so I’m good for another 5 years.” He sees himself doing much of the same thing in the immediate horizon. “I don’t want to severe ties with the US for their training and technology. I’m still part of the heart surgery program in Washington Hospital, but now I don’t operate as much as I used to because I’m here. Now, I’m just like a grandfather to most of them.”
Garcia is definitely one happy patriarch, knowing he has nurtured not just lives and minds, but also hopes and dreams.
Jorge Garcia is probably the only top executive who doesn’t wince at money problems. “I’m having a little trouble paying off some creditors, but at least, I know I can pay my suppliers within the month,” he smiles.
Garcia, Asian Hospital Incorporation’s president and chairman, of course, is not your typical executive. While others brandish an MBA, he holds a medical degree. While others use financial calculators and hold fort in corner offices, he uses a scalpel and reigns in operating theatres. And while others look after their business’s health, Garcia looks after people’s lives. He is, after all, the Philippines’s foremost heart surgeon, bar none, and has made his mark not just in his homeland, but in the United States — his home for the past 35 years — as well. In fact, Garcia continues to play an active role in Georgetown Hospital’s heart program to this day, even as he makes fortnightly visits to the Philippines.
Garcia has enjoyed a robust and fulfilling career serving heart patients, developing heart programs that have benefited many. His success was largely the result of talent and hard work, with some luck thrown in between.
At age 34, the young Garcia, a fast-rising and highly qualified surgeon at Cleveland Hospital, had his first taste of the limelight when he was shown on national TV performing a cardiac catherization. That, though, was entirely unplanned. He recalls: “There was this man who had an angiogram and needed surgery right away. His doctor needed to move fast, and asked me to do the operation. The thing was, NBC wanted to tape the surgery.”
And so, in the minutes before former president Richard Nixon tendered his resignation, America —waiting for their president’s valedictory message — watched as the Filipino surgeon, who was not the least bit nervous, presided over what was then a revolutionary operation. “The news showed a completely arrested heart. Then I restored circulation and it started beating again.”
From then on, Garcia never looked back. The man on TV went on to develop the biggest heart program in Washington DC and the east coast, whose 3,000 annual operations is dwarfed only by Cleveland’s. His patients included US luminaries,
including Clark Clifford, counsel of the Kennedys and author of the vaunted Marshall Plan, and, more recently, Pat Buchanan, who, despite his rightist rantings, entrusted his life to a Filipino doctor and his non-white team when his own mortality came into question. “He was the only white person, along with my assistant, in the operating room,” Garcia recalled with a chuckle.
But though Garcia was content with his life and career, he somehow knew this was not enough.
An operation on a Filipino colleague in 1987 pointed him to new beginnings. He noted that his physician friend, though by no means indigent, still struggled to fork over US$33,000 for a heart bypass in the mainland. That patient told Garcia he could be in a direct position to be of tremendous help to his kababayans.
The thought never left Garcia.
By 1988, he had convinced the Makati Medical Center hierarchy to open a heart surgery program, the Makati Heart Foundation, which he headed. The good doctor would come home regularly to treat Filipino heart patients, who began to enjoy the cost advantages of having their operations done by a US professional in Manila. “A heart surgery in the US would cost around US$25,000 to US$30,000 for the hospital, plus US$10,000 for the doctor. In the Philippines, you would spend US$10,000 for everything, including professional fees,” he pointed out.
Over the years, of course, the heart program evolved. At first, Garcia had to bring in an all-American team of nurses, anesthesiologists, plus a plane load of supplies, to ensure that he could transplant the entire US system to the Philippines and train doctors and nurses in the process.
That, though, was not exactly easy to do. Instead, Garcia found himself taking Filipino professionals to the US for training on open-heart surgeries. There was just one problem: “The US guys liked them so much that they wanted to hire them.”
Garcia, who, to this day, carries a Filipino passport, has always wondered why Filipino physicians, for all their brilliance, never really excelled in their own country, but did so quite easily once abroad. He, of course, had an inkling. “In big US centers like Cleveland and Stanford, Filipinos excel, but not here. So I thought that the problem was the environment.”
And so he again began to dream, and dreamed big.
He explained: “Filipinos are easy learners, they can easily get the flow of things. So I wanted to provide an environment for Filipino professionals, where young ones can
excel.”
In 1995, he and Dr. Rodrigo Floro met with Filipino doctors in the Indiana-Chicago area to tell them that together, they could build a facility that would forever raise health standards in the land of their birth. Their pitch must have been so powerful, for doctors started writing out cheques to the amount of US$50,000 right there and then. “I must have hit a raw nerve,” Dr. Garcia muses, “because their reaction was so spontaneous.”
Their contributions served as the seed money that led to the construction of the hospital. Eventually, institutional investors linked up with the doctors, among them Insular Life, United Laboratories and Vista Holdings of Singapore.
Asian Hospital’s inception, though, was not without problems. Its construction, commencing in 1998, ran smack into the Asian crisis of 1997, which saw the peso tumbling down to 52 to the greenback from the previous 25 to the dollar. Cost overruns spiralled out of control as interest expenses soared. To make matters worse, the impeachment drama of former President Estrada started to unravel, so much so that when a British firm bought out Vista Holdings, which owned 30% of the hospital, it deliberately left out its Philippine operations.
Despite its financial problems, the 258-bed Asian Hospital still managed to open its doors to the public in May last year, with Garcia suddenly finding himself in the unfamiliar position of president.
Thrust into the veritable unknown, Garcia suddenly finds himself presiding over matters he does not exactly enjoy — managing a business, for example. “What’s this ROI? I never heard about this before,” he whines. Sheafing through a pile of reports, he says “I never dreamed I’ll do these things. My forte is heart surgery. I don’t like this. I’m not good at it.”
The marked contrast between Garcia and your run-of-the-mill executive has proven propitious, though. Unlike most executives who fidget at faltering numbers, he looks at the bigger picture — the Asian Hospital’s fundamental strengths, in this case — and asks no questions, keeping an almost child-like faith not usually seen in the business world.
Even as reports of buyouts and creditor concerns swirl about, Garcia is not at all fazed. “Our problem is only money,” he says, explaining payment arrangements made with creditors and suppliers. Besides, he points out, its doctor-investors don’t care so much about the figures businessmen regularly fret over. “Where doctors are concerned, what’s important is the survival of this hospital. We’re not interested in controlling this;
that’s where doctors are coming from. We feel very good about this hospital, and we want this project to be successful, that’s all.”
In fact, Garcia openly talks about the day when he will have to yield his post to “an expert” in the business. As of this writing, a candidate has already been identified. “He’s an expat. We wanted someone knowledgeable in running a US hospital and who has gone through the Joint Commission accreditation,” he revealed.
A Joint Commission accreditation simply means that the facility is at par with US standards, and is thus authorized to deal with the US Medicare and American insurance firms. It also serves as proof that the hospital is safe for the patients and the people who work in it. Garcia has no question that the Asian Hospital will get its accreditation, possibly within the next 18 months. “There’s no question that we’ll get the accreditation; it’s just a question of when.”
For now, Garcia presides over the hospital with much optimism. Even without looking at the numbers that regularly land on his desk, he knows, for a fact, that business is picking up. “Each day I would look out from the operating room, and I would see more cars parked outside. And now I have to wait longer for the elevator, which means there are more people inside,” he notes. He observes, too, that “there is a lot of construction going around” with 90 doctor’s offices now occupied and all 146 sold out. “Things are beginning to gel now,” he says.
Garcia takes heart in the knowledge that “people believe in my vision” — to build a first-class facility that will improve the quality of health care in the country. At the same time, he openly gushes about the hospital, calling it the “most beautiful in Asia.” He is confident that the hospital is just a harbinger of things to come. “When Shangri-La came in, it raised the bar in the hotel industry. I bet you the next hospital that will be built (in the Philippines) will be better than Asian Hospital.”
At present, Asian Hospital is decidedly the most modern facility in the country. Situated in one corner of the Filinvest Corporate City, it is surrounded by lush greenery, which has an immediate calming effect to both patients and physicians. Its modern architecture, characterized by high ceilings, glass walls, and wide halls evoke a feeling of serenity — a far cry from the antiseptic surroundings normally associated with medical institutions. Wood panels, fresh flowers and rock gardens give it a home-like feel. There are no long queues here; its lobby is not unlike a hotel’s, with the usual accoutrements, including concierge and coffee. It is worth noting that the hospital’s rates are very competitive, and its standard rooms, priced at par with the competition’s,
are definitely better appointed.
Though designed for the comfort of patients, the hospital is also a sanctuary of sorts to many Filipino doctors, an enclave where they can be themselves and put all they know to good use.
But what matters now is the quality health care, or at least, vestiges of it, is beginning to come to Philippine territory. A growing number of Filipinos, Garcia observed, are opting to do their heart surgeries here, realizing that quality cardiac care can be had in these parts. Even the surgeon elected to have his own knee surgery done at Asian Hospital. “After two days, I was already doing open heart surgeries,” he added. “ I tell you, we’re good; we’re even better.”
In fact, Dr. Garcia argues that there are many compelling reasons for Filipinos to have their medical care done in the Philippines. “We have very good nurses, we have more manpower in our ICUs, and when it comes to work ethics, we have a genuine interest in our patients.” In addition, “we have a very low infection rate despite the pollution in the Philippines.” At Asian Hospital, Dr. Garcia knows he has a “good, dedicated team, who takes pride in their efforts.”
In fact, he says, he doesn’t mind having to cross the oceans every month because “I look forward to coming here, because I feel accomplished.” That he has cut his earning power doesn’t matter at all to the surgeon. “At this point in my career, I don’t care about professional fees anymore.” He acknowledges, of course, “That there’s always a trade-off, but I’m happy about it.” He adds: “you do things that make you happy. It’s not the money or the profession. You can be a clerk, but so long as you’re happy, you look forward to going to your place of work and put 100% of your effort into it.”
Of course, his routine could be quite enervating. The fortnightly commute and 2-3 operations per day could also sap his energies. “Jet lag hits me. Of course, I suffer too.”
But all that take a backseat when he thinks of his shining moments, which are the times “when I know I was able to pull a patient out of the fire.” Thirty-five years of surgery have not at all diminished the sweet feeling of accomplishment each time he is able to bring people back from the brink. He talks about his most recent emergency operation with much pride. “I was at the lounge, watching TV Patrol. We had just finished a case so everybody was there, when we were told there was a patient who had no more blood to the heart. We did a quick operation and now he is alive,” he
relates. Seeing that the patient is now back to his daily grind, he could only feel triumphant. “You really feel good about these things,” he stresses.
He also draws a lot of strength in the realization that he has helped a lot of young surgeons in their careers. “Seeing a lot of young surgeons, many of whom were under my wing here and in the US, who try to emulate what a surgeon should think and do — that makes me feel really happy. I see I have done something good for them, and when I see their offices full, I see that I have done something good for them. I tell you, it’s a very rewarding feeling, and no trophy can replace that.”
Obviously, Garcia has a lot of things to keep him going. “I’m 61, so I’m good for another 5 years.” He sees himself doing much of the same thing in the immediate horizon. “I don’t want to severe ties with the US for their training and technology. I’m still part of the heart surgery program in Washington Hospital, but now I don’t operate as much as I used to because I’m here. Now, I’m just like a grandfather to most of them.”
Garcia is definitely one happy patriarch, knowing he has nurtured not just lives and minds, but also hopes and dreams.
People I Admire Series: Rodolfo Cuenca
Published in Men's Zone Magazine, January 2003
Whenever the story of former President Marcos is told, the name of Rodolfo Cuenca inevitably comes up. In these stories, as in real life, the lives of both men were so deeply, profoundly intertwined that few recognize they were separate individuals with their own destinies.
What cannot be denied is that Marcos’s and Cuenca’s fates more or less followed the same course. Both men were intelligent and were doers, who saw things as they wanted and knew how this would be done. Both built their own empires and saw their eventual destruction. Both would end up reviled, but their accomplishments cherished. History has yet to judge both and, 16 years hence, their stories have yet to be heard.
Ferdinand Marcos and Rodolfo Cuenca go back a long way, Marcos being the lawyer of Cuenca’s mother right after the war. Their friendship, though, would not evolve until much later. Their first “formal” business meeting did not take place until the late ’50s when Cuenca, already a contractor, approached Marcos, then the head of the National Economic Council, to discuss the problems of the industry. “There was a cement supply problem,” recalls Cuenca, “and so we, the local contractors, decided to set up a cement plant.” The plan was to apply for a complete cement plant under the Japanese Reparations Program. The only problem was that another entity, owned by a Boholano and thus a supporter of the incumbent president, Carlos Garcia, wanted to set up a similar plant. The contractors’ association, reasoning they needed the plant more because they were the end users of cement, sought Marcos’s assistance.
The paths of Marcos and Cuenca would cross several times more after that initial meeting. Each subsequent encounter would enable both men to gain each other’s confidence. Although Cuenca’s activities were focused on construction, he would somehow find himself thrown in the same circles as Marcos.
When Cuenca first took on the challenge of building Manila’s first luxury hotel, he did not anticipate he would somehow find himself connected once more to the fast-rising politician from Ilocos. On the prodding of Bobby Benedicto in 1961, Cuenca, with the backing of Eugenio Lopez Sr. and Alfredo Montelibano, undertook the project against
considerable odds. It was an unenviable job, for Lopez was the political opponent of the incumbent Diosdado Macapagal. “Setting up a hotel when the government is against you is not easy,” he points out. In fact, the Ayalas had turned their nose on the project, not believing that Lopez had what it took to complete an undertaking of such magnitude. “Lopez was angry and told me to go get his house and lot at Roxas Boulevard and build the hotel there. And so I did.”
Bobby Benedicto would later on be instrumental in convincing Lopez to back Marcos’s nomination as the candidate of the Nacionalista Party. When the hotel, called the Sheraton, opened its doors in 1966, Marcos came to inaugurate it.
It was this same year that Marcos, invited to speak before the Philippine Contractors Association, challenged the contractors to help his administration build and finance roads — government, at that time, had no funds.
A group of contractors, including Cuenca, quickly took up the wager. Under the Contractors Financing Bill, embodied in Republic Act 3745, the contractors bidded to construct, and at the same time, finance, what are now the North and South superhighways, which were then one-lane affairs left uncompleted by the army’s engineering battalion. Marcos was quickly enamored by the idea, realizing its strategic importance to his continued popularity as president.
Thus was conceived the Construction and Development Corporation of the Philippines (CDCP) — a company that would blaze new trails for the Philippine construction industry and that, at its zenith, had more than 35,000 in its employ.
Incorporated with a capital of Php4 million by the 20 or so contractors in the group and PCI Bank, CDCP would be the lone bidder for the project. Cuenca, who was elected to be company president, recalled the mathematics of the project was rather simple: the company’s costs would be covered by the toll collections at 12% interest. With nobody to contest its bid, CDCP was awarded the contract and early in 1967, project mobilization started.
“It was a hard time to make deals,” recalls Cuenca. “PDCP, headed by Ting Jayme, a schoolmate at the Ateneo, didn’t know about project financing, so I worked it out. I remember, PhilamGen was the first group that gave financing to CDCP.”
A little financial creativity proved helpful. “In 1972, we financed projects on the proposition that we could get it back through toll,” he explained. This covered the stretch it had previously completed. It was thereafter granted the franchise to continue building and maintaining the extensions of this road.
Though he concedes that CDCP was “hamstrung in its operations” by such concerns as location and land expropriation problems, it was able to open Balintawak in 1968 and Nichols shortly thereafter. Marcos was elated — the tollways greatly facilitated the transfer of rice and goods from central Luzon to the city. “Rice and roads” would eventually be one of the battlecries of his administration.
By then, Cuenca and Marcos had become good friends; good enough for the president to regularly consult with the construction man. “I do not deny that I was a golfmate of Marcos. I remember the demonstrations around 1971. We were playing golf and I could hear the militant group trying to crash the palace gates.”
In fact, this friendship would bring him before the Senate Blue Ribbon committee, where then Senator Benigno Aquino charged that he gave kickbacks for the tollways contract. The grilling was so intense that on the third day of interrogation, Cuenca offered to open all of CDCP’s books. Ironically, the Senate decided to just stop the proceedings.
Still, no amount of politicking could stop CDCP from tracing its growth trajectory. With its financial knowhow and construction capability, CDCP won project upon project, and by 1979, it had assets of Php3.69 billion. The country’s best engineers were in its employ, and it was able to forge arrangements with global banking institutions. Not only was it into industrial and heavy construction, but it also made forays into mining, trading, manufacturing, real estate, transportation, shipping, agribusiness, resort hotels, insurance brokerage, and process engineering. It had offices in the Americas, the Middle East and Asia.
To this day, most Philippine landmarks, from highways to bridges to dams, still bear the CDCP seal. Cuenca, however, prefers to call himself as a bridge man. It was not until a son asked how many bridges he had built that he began counting; there are at least 20 of them built in a span of nine years, all before CDCP came to being.
CDCP’s imprimatur is also on many Asian and Middle East structures. Mr. Cuenca recalls how the company rebuilt the Burubudur temple in Jakarta as part of a UNESCO project. “We worked on it for 12 years because the work demanded 12 years,” he explains. Built on a collapsing hill, the work entailed removing thousands of stones piece by piece for repair, redoing the base and then returning the stones, again, piece by piece. “Then in between, they had no money,” he laughs in recollection.
Of course, projects of such magnitude necessitated tapping foreign fund sources, all of them dollar-denominated. To leverage on its foreign debt, CDCP took on overseas projects. In fact, it was CDCP that fathered the OCW phenomenon.
He remembers that there were no more than nine Filipino engineers around that time in Saudi Arabia. “I was shanghaied by Alex Melchor in 1975 to go to Jeddah and there was nothing there but desert. I stayed in the only hotel in Jeddah for 10 days and there was no airconditioning. The clean towels were always yellow because there were sandstorms everyday.”
CDCP’s project inside Mecca in Saudi Arabia will always be memorable to Cuenca. Because Christians are not allowed within the Holy City, CDCP had no choice but to train 2,000 Muslim workers from Zamboanga, Jolo and Tawi-Tawi to do the project. “Nobody remembers that anymore, but they were the first OFWs. I was the first to bring people to the Middle East.”
In 1976, CDCP got its first Saudi contract from an Osama bin Laden corporation to clear 1,200 hectares of land for site development. The job entailed laying out pipes and building roads within six months. Two thousand Filipino workers finished the project in four and a half months and forever established their reputation for quality work. “They realized, ang galing pala ng Pinoy, so that started the exodus.”
Given its breadth of operations, CDCP always kept to strict quality control standards. Cuenca cannot overemphasize the need for a good plan — something he learned from his early days as a contractor of bridges all over the Philippines. “I remember, when we were doing projects after the war, there would be these GI inspectors who would bore holes on bridges just to measure the thickness of the concrete we used.” He contrasts this to the way things are done now, “when plans are deliberately made not to be correct.”
Despite accusations to the contrary, CDCP did not give in to squeezing from public works officials. “When I began, it wasn’t that way. I refused to allow CDCP into shenanigans; at most, we would finance social activities, but that was okay, since it was for the group. Now engineers squeeze you to come across.”
Despite its foreign forays, CDCP never wavered in its commitment to the Philippines. So when the reclamation of Manila Bay was put on the table, CDCP was ready to make its bid, going up against Yuchengco-controlled EEI Corp. and Lopa’s Mantrade. With its aggressive bid and willingness to arrange financing, CDCP won the contract.
From the beginning, though, the reclamation project seemed to be clouded by a bad omen.
For one, the First Lady, Imelda Marcos, was adamant in her objections to the project. So were Jolly Benitez and Kokoy Romualdez, who had made no attempt to hide his disdain for Cuenca over the latter’s inability to accommodate his request to provide lodging for Gloria Diaz, the newly crowned Ms. Universe, at the CDCP-controlled Pines Hotel in Baguio.
“Paluluhurin ko rin yang Cuenca na yan,” Romualdez was overheard telling people at the Baguio Country Club the following day.
For Cuenca, though, the reclamation venture was one good project. “They called it garbage, but it was actually three-fold in its purpose. It was going to be a government center, three storys maximum, spread out Hawaiian style, with its own internal road system. It was also supposed to have its sports complex, not to mention the financial center (where GSIS and PNB are now located) with the objective of making it compete with Hong Kong as a regional financial center,” he explained. Under the terms of the project, CDCP was supposed to be paid with half of the reclaimed area, which it intended to sell at Php1,000 per square meter. But none of these materialized. “Through political maneuverings, we were not allowed to sell so I was stuck.”
In the end, it was the reclamation project that would bring CDCP to its knees. Though CDCP managed to reclaim the land, it did not get paid for it. True, Cuenca was Marcos’s friend, but the fact was that government was bankrupt and was, in fact, unable to cover its obligations. The third oil shock had just shaken the world. It was also the lowest point in Philippine economic history. To complicate matters, the Iran-Iraq war erupted just as CDCP was working on a 60-km highway in Iraq.
“We borrowed dollars when it was Php8 to the dollar. By 1981, the peso went from Php8 to Php20 to the dollar, and interest rates all over the world shot up as a result of the third oil shock. At that time, government owed us Php200 to Php300 million and they never made good on this.”
Yet Cuenca never wavered when the president sought his assistance for government’s projects. Cuenca was his man on the ground in the war-torn, desolate countries that few wanted to set foot on. He was sent to Gabon in search of the ever-elusive uranium that would have been used for the Bataan Nuclear Power Plant. (He clarifies, though, that CDCP had no part in the construction of the nuclear plant whatsoever. “It was the total baby of Herminio Disini and he didn’t want me in on anything,” he smiles wanly.) “I met with President Omar Bongo y Carbon but he said all their uranium had already been committed, but he told me I could go this little little country in the Sahara, called Niger.” Accompanied by an aide and with only a letter from President Bongo, Cuenca met the Niger president, who agreed to provide the Philippines with the uranium it needed.
This zeal to help, however, would also be Cuenca’s, and inevitably, CDCP’s undoing.
Not that CDCP, or Cuenca, for that matter, had much of a choice. Economics necessitated it. In fact, he recalls, the Iraq project “was imposed on us, because (Energy Minister Geronimo) Velasco convinced Marcos to get CDCP to Iraq because he wanted oil concessions.” To complicate matters, the Philippines had no ambassador to Iraq so Marcos sent emissary JV Cruz to assist CDCP. “But even Cruz could not convince the Iraq government to allow CDCP to withdraw as the war with Iran was making the operations very costly.” This, Cuenca submits, was what “broke our backs.”
With Php1 billion tied up in the reclamation project, Php250 million in debt and unable to collect on its other government receivables, CDCP found itself walled in by cash pressures. Yet, up to 1983, CDCP did not stand in default.
However, CDCP’s precarious cash position, directly tied to the wobbling global and domestic economies, became a weapon for Marcos’s enemies. “What broke me and Marcos were these New York bankers. They made me out to be a bad person, and said I was getting jobs on a silver platter.They said the company was mismanaged, but is war mismanagement? Was the fall of the peso and the rise in interest rates the result of my mismanagement?”
Feebled by sickness, and pressured by his own economic team, Marcos found himself unable to stand by his golf buddy. Sixteen years after founding CDCP, Cuenca found himself giving up its reins — a decision he regrets to this day.
“I was forced out by Ongpin, Mapa — he was then PNB president and even wanted to appropriate my personal car in Hong Kong — and Virata because we owed so much money even if we were not in default. We tried to sell shares but could not recover. We were just in too many projects, to help recovery. We even went into copper mining in a godforsaken place in Southern Negros just to help the people; government foreclosed on it and just threw away the equipment.”
He knows, of course, why people were just too eager to destroy him. “At that time, people were trying to destroy Marcos, so how do you destroy a steel column? You destroy it with rust, and you create rust by destroying those in the perimeter.” Stone-faced, he concludes
“I was one of those.”
By then, he knew that Marcos was beginning to crumble — little by little, for the man was extremely strong — inside. He knew, for instance, that the president was not comfortable with some of his appointees. “Bobby Ongpin (of the DTI) could not even have 10 minutes with him,” he recalled. These people were no longer the likes of Arturo Tanco who had worked wonders for the Marcos administration and enjoyed the strongman’s full confidence. “The president was tired and sad; there were things he wanted to do which he couldn’t.”
Looking at his company, since renamed Philippine National Construction Corporation (PNCC) and just a shadow of the once mighty CDCP, he can only feel dismay. “I feel feel sad and bitter, knowing that we set up a good company and that government political appointees mismanaged it. We had a good company, and all government did was to prostitute it, dismantling it piece by piece.” He shakes his head thinking of the contracts PNCC has entered with the likes of Citra, Crown Equities and Benpres, all of which he believes do the company no good. But then again, he understands why. “When you put people who have no risk, no shareholding, into the company, there’s no serious intent to do anything themselves, so everything is given away.” It is easy to understand why he has nothing but disdain for “all these Wharton graduates, with their New York-direction — that’s why they don’t think like “Mahathir.”
Realizing he could drag down the president if he stayed around, and eager to try his luck elsewhere, Cuenca left the Philippines on his own volition in 1984. He did manage to come back to visit the late president two days before the snap elections. “He was not looking well, and I asked him, why do you still have to do this interview with Ted Koppel?” The president answered he had to show that he could still win an election. That was the last time he saw him alive.
By then, the government had foreclosed on his other properties, including Pines Hotel, which is ironic considering that it was the Development Bank of the Philippines, one of the hotel’s shareholders, that instituted foreclosure proceedings. The properties have since been “sold for a song” to Henry Sy and is currently being contested in court by the two parties.
Fortunately, other countries were not as hostile to Cuenca and his businesses. He lived in Hong Kong and Malaysia, where he developed a 400-hectare property for aquaculture and built a highway in the east coast of Java. He was in Hong Kong when the EDSA Revolution broke out, and did not realize, until much later, on a return trip to Hong Kong from Malaysia, that Philippine authorities had cancelled his passport.
Still, Cuenca and Marcos continued to keep in touch even when the strongman was already living in exile in Hawaii. “Marcos called me from Hawaii in Malaysia. He said don’t come to America, they’ll file suit against all of us.” Cuenca, though, could not be stopped. He got himself a Paraguay travel document and travelled a number of times to the US before being arrested by authorities in 1988, to be a material witness in the Marcos case, under the RICO law.
“So I had to post bond,” he recalls. “I shared a room with this guy and asked him, what are you in for — drugs?” The flip side to his arrest was that he was, at least, given a passport. 0n March 30 1990, the day before the expiry of his Philippine passport, he went back to his homeland and found his picture splashed in the papers the following day.
As it would happen, the PCGG would grant him immunity from suit in exchange for testifying in the case against Marcos. Just the same, despite the cloak of immunity, he faces two cases before the Ombudsman today.
Sixteen years, though, have not destroyed Cuenca’s zeal. He knows his is an uphill battle but yes, he does want to take back the erstwhile CDCP, knowing that only one who has invested his life and blood into the company would care enough to restructure it properly.
Besides, from the looks of it, the government never really got to convert CDCP’s loans into equity, as it should have. This, of course, is now the subject of litigation, and all Cuenca could do for the meantime is hope that the company’s administrators do not auction off its crown jewels for next to nothing to people who have no real dedication to the company.
“People there have no risk,” he says, shaking his head. “Just look at Citra, they knew the cost of the highway was high, so they improved a short stretch and took away all the collections from the existing road. And look at Benpres, now it doesn’t have money!”
He notes, as well, that this is the same fate that befell most of Marcos’s projects, wasted for most part and now a cash cow for whoever happens to be in power. He can’t help but care. Marcos was, after all, his friend, and yes, at the risk of personal security, he admits that he is a crony. “What’s a crony anyway? If you use your friendship to be of help, to provide information, and not for your personal motivation, then you are a good crony.”
Yet Cuenca is not allowing these to break his spirit. The good thing to have come out from this is that he has discovered who will stand by him. “There are those who pretend they don’t know me when they see me,” he laughs wryly, ticking off names that grace the highest levels of today’s political and economic strata. But he now rests easy. “I believe that when things are done, they’re done. It teaches you a lesson. To take revenge kills you mentally.”
Instead, at 74, he is concentrating on still giving a little of himself to others — helping fix up Manila Golf and seeing to the needs of Urdaneta Village, where he lives in the house he constructed 40 years ago with the woman he married 54 years ago. He regales in the achievements of his four children and grandchildren. He plays 18 holes of golf and can still finish a bottle of scotch three times a week. He still reads the papers and shakes his head at the vagaries of local politics. He knows people and politicians only too well. Once in a while, he gives his ideas on everyday problems such as traffic congestion to local officials but to date, nobody has acted on them. “Who gives an old man like me a second look?” he says.
Yet he retains the vigor of the man who, in his younger days, joined the guerrillas and jumped in joy over the cigarettes and chocolates from airdrops, never mind if all he had was a carbine and worn-out shoes; the entrepreneur who would take his 6x6 across four mountains and four rivers to trade goods even if he did not have a centavo in his pocket, because he knew everybody along the way; the visionary who built an empire and did not hesitate to vacate it for the sake of a friend who had little else to offer at that point.
People say that Marcos knew how to choose his friends. It is not surprising to see why Cuenca was among his most valued.
Whenever the story of former President Marcos is told, the name of Rodolfo Cuenca inevitably comes up. In these stories, as in real life, the lives of both men were so deeply, profoundly intertwined that few recognize they were separate individuals with their own destinies.
What cannot be denied is that Marcos’s and Cuenca’s fates more or less followed the same course. Both men were intelligent and were doers, who saw things as they wanted and knew how this would be done. Both built their own empires and saw their eventual destruction. Both would end up reviled, but their accomplishments cherished. History has yet to judge both and, 16 years hence, their stories have yet to be heard.
Ferdinand Marcos and Rodolfo Cuenca go back a long way, Marcos being the lawyer of Cuenca’s mother right after the war. Their friendship, though, would not evolve until much later. Their first “formal” business meeting did not take place until the late ’50s when Cuenca, already a contractor, approached Marcos, then the head of the National Economic Council, to discuss the problems of the industry. “There was a cement supply problem,” recalls Cuenca, “and so we, the local contractors, decided to set up a cement plant.” The plan was to apply for a complete cement plant under the Japanese Reparations Program. The only problem was that another entity, owned by a Boholano and thus a supporter of the incumbent president, Carlos Garcia, wanted to set up a similar plant. The contractors’ association, reasoning they needed the plant more because they were the end users of cement, sought Marcos’s assistance.
The paths of Marcos and Cuenca would cross several times more after that initial meeting. Each subsequent encounter would enable both men to gain each other’s confidence. Although Cuenca’s activities were focused on construction, he would somehow find himself thrown in the same circles as Marcos.
When Cuenca first took on the challenge of building Manila’s first luxury hotel, he did not anticipate he would somehow find himself connected once more to the fast-rising politician from Ilocos. On the prodding of Bobby Benedicto in 1961, Cuenca, with the backing of Eugenio Lopez Sr. and Alfredo Montelibano, undertook the project against
considerable odds. It was an unenviable job, for Lopez was the political opponent of the incumbent Diosdado Macapagal. “Setting up a hotel when the government is against you is not easy,” he points out. In fact, the Ayalas had turned their nose on the project, not believing that Lopez had what it took to complete an undertaking of such magnitude. “Lopez was angry and told me to go get his house and lot at Roxas Boulevard and build the hotel there. And so I did.”
Bobby Benedicto would later on be instrumental in convincing Lopez to back Marcos’s nomination as the candidate of the Nacionalista Party. When the hotel, called the Sheraton, opened its doors in 1966, Marcos came to inaugurate it.
It was this same year that Marcos, invited to speak before the Philippine Contractors Association, challenged the contractors to help his administration build and finance roads — government, at that time, had no funds.
A group of contractors, including Cuenca, quickly took up the wager. Under the Contractors Financing Bill, embodied in Republic Act 3745, the contractors bidded to construct, and at the same time, finance, what are now the North and South superhighways, which were then one-lane affairs left uncompleted by the army’s engineering battalion. Marcos was quickly enamored by the idea, realizing its strategic importance to his continued popularity as president.
Thus was conceived the Construction and Development Corporation of the Philippines (CDCP) — a company that would blaze new trails for the Philippine construction industry and that, at its zenith, had more than 35,000 in its employ.
Incorporated with a capital of Php4 million by the 20 or so contractors in the group and PCI Bank, CDCP would be the lone bidder for the project. Cuenca, who was elected to be company president, recalled the mathematics of the project was rather simple: the company’s costs would be covered by the toll collections at 12% interest. With nobody to contest its bid, CDCP was awarded the contract and early in 1967, project mobilization started.
“It was a hard time to make deals,” recalls Cuenca. “PDCP, headed by Ting Jayme, a schoolmate at the Ateneo, didn’t know about project financing, so I worked it out. I remember, PhilamGen was the first group that gave financing to CDCP.”
A little financial creativity proved helpful. “In 1972, we financed projects on the proposition that we could get it back through toll,” he explained. This covered the stretch it had previously completed. It was thereafter granted the franchise to continue building and maintaining the extensions of this road.
Though he concedes that CDCP was “hamstrung in its operations” by such concerns as location and land expropriation problems, it was able to open Balintawak in 1968 and Nichols shortly thereafter. Marcos was elated — the tollways greatly facilitated the transfer of rice and goods from central Luzon to the city. “Rice and roads” would eventually be one of the battlecries of his administration.
By then, Cuenca and Marcos had become good friends; good enough for the president to regularly consult with the construction man. “I do not deny that I was a golfmate of Marcos. I remember the demonstrations around 1971. We were playing golf and I could hear the militant group trying to crash the palace gates.”
In fact, this friendship would bring him before the Senate Blue Ribbon committee, where then Senator Benigno Aquino charged that he gave kickbacks for the tollways contract. The grilling was so intense that on the third day of interrogation, Cuenca offered to open all of CDCP’s books. Ironically, the Senate decided to just stop the proceedings.
Still, no amount of politicking could stop CDCP from tracing its growth trajectory. With its financial knowhow and construction capability, CDCP won project upon project, and by 1979, it had assets of Php3.69 billion. The country’s best engineers were in its employ, and it was able to forge arrangements with global banking institutions. Not only was it into industrial and heavy construction, but it also made forays into mining, trading, manufacturing, real estate, transportation, shipping, agribusiness, resort hotels, insurance brokerage, and process engineering. It had offices in the Americas, the Middle East and Asia.
To this day, most Philippine landmarks, from highways to bridges to dams, still bear the CDCP seal. Cuenca, however, prefers to call himself as a bridge man. It was not until a son asked how many bridges he had built that he began counting; there are at least 20 of them built in a span of nine years, all before CDCP came to being.
CDCP’s imprimatur is also on many Asian and Middle East structures. Mr. Cuenca recalls how the company rebuilt the Burubudur temple in Jakarta as part of a UNESCO project. “We worked on it for 12 years because the work demanded 12 years,” he explains. Built on a collapsing hill, the work entailed removing thousands of stones piece by piece for repair, redoing the base and then returning the stones, again, piece by piece. “Then in between, they had no money,” he laughs in recollection.
Of course, projects of such magnitude necessitated tapping foreign fund sources, all of them dollar-denominated. To leverage on its foreign debt, CDCP took on overseas projects. In fact, it was CDCP that fathered the OCW phenomenon.
He remembers that there were no more than nine Filipino engineers around that time in Saudi Arabia. “I was shanghaied by Alex Melchor in 1975 to go to Jeddah and there was nothing there but desert. I stayed in the only hotel in Jeddah for 10 days and there was no airconditioning. The clean towels were always yellow because there were sandstorms everyday.”
CDCP’s project inside Mecca in Saudi Arabia will always be memorable to Cuenca. Because Christians are not allowed within the Holy City, CDCP had no choice but to train 2,000 Muslim workers from Zamboanga, Jolo and Tawi-Tawi to do the project. “Nobody remembers that anymore, but they were the first OFWs. I was the first to bring people to the Middle East.”
In 1976, CDCP got its first Saudi contract from an Osama bin Laden corporation to clear 1,200 hectares of land for site development. The job entailed laying out pipes and building roads within six months. Two thousand Filipino workers finished the project in four and a half months and forever established their reputation for quality work. “They realized, ang galing pala ng Pinoy, so that started the exodus.”
Given its breadth of operations, CDCP always kept to strict quality control standards. Cuenca cannot overemphasize the need for a good plan — something he learned from his early days as a contractor of bridges all over the Philippines. “I remember, when we were doing projects after the war, there would be these GI inspectors who would bore holes on bridges just to measure the thickness of the concrete we used.” He contrasts this to the way things are done now, “when plans are deliberately made not to be correct.”
Despite accusations to the contrary, CDCP did not give in to squeezing from public works officials. “When I began, it wasn’t that way. I refused to allow CDCP into shenanigans; at most, we would finance social activities, but that was okay, since it was for the group. Now engineers squeeze you to come across.”
Despite its foreign forays, CDCP never wavered in its commitment to the Philippines. So when the reclamation of Manila Bay was put on the table, CDCP was ready to make its bid, going up against Yuchengco-controlled EEI Corp. and Lopa’s Mantrade. With its aggressive bid and willingness to arrange financing, CDCP won the contract.
From the beginning, though, the reclamation project seemed to be clouded by a bad omen.
For one, the First Lady, Imelda Marcos, was adamant in her objections to the project. So were Jolly Benitez and Kokoy Romualdez, who had made no attempt to hide his disdain for Cuenca over the latter’s inability to accommodate his request to provide lodging for Gloria Diaz, the newly crowned Ms. Universe, at the CDCP-controlled Pines Hotel in Baguio.
“Paluluhurin ko rin yang Cuenca na yan,” Romualdez was overheard telling people at the Baguio Country Club the following day.
For Cuenca, though, the reclamation venture was one good project. “They called it garbage, but it was actually three-fold in its purpose. It was going to be a government center, three storys maximum, spread out Hawaiian style, with its own internal road system. It was also supposed to have its sports complex, not to mention the financial center (where GSIS and PNB are now located) with the objective of making it compete with Hong Kong as a regional financial center,” he explained. Under the terms of the project, CDCP was supposed to be paid with half of the reclaimed area, which it intended to sell at Php1,000 per square meter. But none of these materialized. “Through political maneuverings, we were not allowed to sell so I was stuck.”
In the end, it was the reclamation project that would bring CDCP to its knees. Though CDCP managed to reclaim the land, it did not get paid for it. True, Cuenca was Marcos’s friend, but the fact was that government was bankrupt and was, in fact, unable to cover its obligations. The third oil shock had just shaken the world. It was also the lowest point in Philippine economic history. To complicate matters, the Iran-Iraq war erupted just as CDCP was working on a 60-km highway in Iraq.
“We borrowed dollars when it was Php8 to the dollar. By 1981, the peso went from Php8 to Php20 to the dollar, and interest rates all over the world shot up as a result of the third oil shock. At that time, government owed us Php200 to Php300 million and they never made good on this.”
Yet Cuenca never wavered when the president sought his assistance for government’s projects. Cuenca was his man on the ground in the war-torn, desolate countries that few wanted to set foot on. He was sent to Gabon in search of the ever-elusive uranium that would have been used for the Bataan Nuclear Power Plant. (He clarifies, though, that CDCP had no part in the construction of the nuclear plant whatsoever. “It was the total baby of Herminio Disini and he didn’t want me in on anything,” he smiles wanly.) “I met with President Omar Bongo y Carbon but he said all their uranium had already been committed, but he told me I could go this little little country in the Sahara, called Niger.” Accompanied by an aide and with only a letter from President Bongo, Cuenca met the Niger president, who agreed to provide the Philippines with the uranium it needed.
This zeal to help, however, would also be Cuenca’s, and inevitably, CDCP’s undoing.
Not that CDCP, or Cuenca, for that matter, had much of a choice. Economics necessitated it. In fact, he recalls, the Iraq project “was imposed on us, because (Energy Minister Geronimo) Velasco convinced Marcos to get CDCP to Iraq because he wanted oil concessions.” To complicate matters, the Philippines had no ambassador to Iraq so Marcos sent emissary JV Cruz to assist CDCP. “But even Cruz could not convince the Iraq government to allow CDCP to withdraw as the war with Iran was making the operations very costly.” This, Cuenca submits, was what “broke our backs.”
With Php1 billion tied up in the reclamation project, Php250 million in debt and unable to collect on its other government receivables, CDCP found itself walled in by cash pressures. Yet, up to 1983, CDCP did not stand in default.
However, CDCP’s precarious cash position, directly tied to the wobbling global and domestic economies, became a weapon for Marcos’s enemies. “What broke me and Marcos were these New York bankers. They made me out to be a bad person, and said I was getting jobs on a silver platter.They said the company was mismanaged, but is war mismanagement? Was the fall of the peso and the rise in interest rates the result of my mismanagement?”
Feebled by sickness, and pressured by his own economic team, Marcos found himself unable to stand by his golf buddy. Sixteen years after founding CDCP, Cuenca found himself giving up its reins — a decision he regrets to this day.
“I was forced out by Ongpin, Mapa — he was then PNB president and even wanted to appropriate my personal car in Hong Kong — and Virata because we owed so much money even if we were not in default. We tried to sell shares but could not recover. We were just in too many projects, to help recovery. We even went into copper mining in a godforsaken place in Southern Negros just to help the people; government foreclosed on it and just threw away the equipment.”
He knows, of course, why people were just too eager to destroy him. “At that time, people were trying to destroy Marcos, so how do you destroy a steel column? You destroy it with rust, and you create rust by destroying those in the perimeter.” Stone-faced, he concludes
“I was one of those.”
By then, he knew that Marcos was beginning to crumble — little by little, for the man was extremely strong — inside. He knew, for instance, that the president was not comfortable with some of his appointees. “Bobby Ongpin (of the DTI) could not even have 10 minutes with him,” he recalled. These people were no longer the likes of Arturo Tanco who had worked wonders for the Marcos administration and enjoyed the strongman’s full confidence. “The president was tired and sad; there were things he wanted to do which he couldn’t.”
Looking at his company, since renamed Philippine National Construction Corporation (PNCC) and just a shadow of the once mighty CDCP, he can only feel dismay. “I feel feel sad and bitter, knowing that we set up a good company and that government political appointees mismanaged it. We had a good company, and all government did was to prostitute it, dismantling it piece by piece.” He shakes his head thinking of the contracts PNCC has entered with the likes of Citra, Crown Equities and Benpres, all of which he believes do the company no good. But then again, he understands why. “When you put people who have no risk, no shareholding, into the company, there’s no serious intent to do anything themselves, so everything is given away.” It is easy to understand why he has nothing but disdain for “all these Wharton graduates, with their New York-direction — that’s why they don’t think like “Mahathir.”
Realizing he could drag down the president if he stayed around, and eager to try his luck elsewhere, Cuenca left the Philippines on his own volition in 1984. He did manage to come back to visit the late president two days before the snap elections. “He was not looking well, and I asked him, why do you still have to do this interview with Ted Koppel?” The president answered he had to show that he could still win an election. That was the last time he saw him alive.
By then, the government had foreclosed on his other properties, including Pines Hotel, which is ironic considering that it was the Development Bank of the Philippines, one of the hotel’s shareholders, that instituted foreclosure proceedings. The properties have since been “sold for a song” to Henry Sy and is currently being contested in court by the two parties.
Fortunately, other countries were not as hostile to Cuenca and his businesses. He lived in Hong Kong and Malaysia, where he developed a 400-hectare property for aquaculture and built a highway in the east coast of Java. He was in Hong Kong when the EDSA Revolution broke out, and did not realize, until much later, on a return trip to Hong Kong from Malaysia, that Philippine authorities had cancelled his passport.
Still, Cuenca and Marcos continued to keep in touch even when the strongman was already living in exile in Hawaii. “Marcos called me from Hawaii in Malaysia. He said don’t come to America, they’ll file suit against all of us.” Cuenca, though, could not be stopped. He got himself a Paraguay travel document and travelled a number of times to the US before being arrested by authorities in 1988, to be a material witness in the Marcos case, under the RICO law.
“So I had to post bond,” he recalls. “I shared a room with this guy and asked him, what are you in for — drugs?” The flip side to his arrest was that he was, at least, given a passport. 0n March 30 1990, the day before the expiry of his Philippine passport, he went back to his homeland and found his picture splashed in the papers the following day.
As it would happen, the PCGG would grant him immunity from suit in exchange for testifying in the case against Marcos. Just the same, despite the cloak of immunity, he faces two cases before the Ombudsman today.
Sixteen years, though, have not destroyed Cuenca’s zeal. He knows his is an uphill battle but yes, he does want to take back the erstwhile CDCP, knowing that only one who has invested his life and blood into the company would care enough to restructure it properly.
Besides, from the looks of it, the government never really got to convert CDCP’s loans into equity, as it should have. This, of course, is now the subject of litigation, and all Cuenca could do for the meantime is hope that the company’s administrators do not auction off its crown jewels for next to nothing to people who have no real dedication to the company.
“People there have no risk,” he says, shaking his head. “Just look at Citra, they knew the cost of the highway was high, so they improved a short stretch and took away all the collections from the existing road. And look at Benpres, now it doesn’t have money!”
He notes, as well, that this is the same fate that befell most of Marcos’s projects, wasted for most part and now a cash cow for whoever happens to be in power. He can’t help but care. Marcos was, after all, his friend, and yes, at the risk of personal security, he admits that he is a crony. “What’s a crony anyway? If you use your friendship to be of help, to provide information, and not for your personal motivation, then you are a good crony.”
Yet Cuenca is not allowing these to break his spirit. The good thing to have come out from this is that he has discovered who will stand by him. “There are those who pretend they don’t know me when they see me,” he laughs wryly, ticking off names that grace the highest levels of today’s political and economic strata. But he now rests easy. “I believe that when things are done, they’re done. It teaches you a lesson. To take revenge kills you mentally.”
Instead, at 74, he is concentrating on still giving a little of himself to others — helping fix up Manila Golf and seeing to the needs of Urdaneta Village, where he lives in the house he constructed 40 years ago with the woman he married 54 years ago. He regales in the achievements of his four children and grandchildren. He plays 18 holes of golf and can still finish a bottle of scotch three times a week. He still reads the papers and shakes his head at the vagaries of local politics. He knows people and politicians only too well. Once in a while, he gives his ideas on everyday problems such as traffic congestion to local officials but to date, nobody has acted on them. “Who gives an old man like me a second look?” he says.
Yet he retains the vigor of the man who, in his younger days, joined the guerrillas and jumped in joy over the cigarettes and chocolates from airdrops, never mind if all he had was a carbine and worn-out shoes; the entrepreneur who would take his 6x6 across four mountains and four rivers to trade goods even if he did not have a centavo in his pocket, because he knew everybody along the way; the visionary who built an empire and did not hesitate to vacate it for the sake of a friend who had little else to offer at that point.
People say that Marcos knew how to choose his friends. It is not surprising to see why Cuenca was among his most valued.
Wednesday, March 8, 2006
People I Admire Series: Alfonso Yuchengco
(This was probably one of my most difficult interviews -- Yuchengco kept joking all throughout our conversation.)
One of the keys to the success of Alfonso Yuchengco, 83, is how he values partnerships, whether it is with a person, a company, or a country In business circles, his name is synonymous with banking and insurance. He saw the Yuchengco Group of Companies-composed of Rizal Commercial Banking Corporation, Pan Malayan Management and Investment Corporation, Great Pacific Life Insurance, House of Investments, and the Malayan Group of Insurance Companies-grow into the giant that it is today.
Though he jokes that he is "somewhat involved in the decision-making process, and sometimes, they follow me," Yuchengco, who is chairman of the group, is still very much updated with the goings-on in their subsidiaries and affiliated companies. Major plans still pass through him and he remains the strict boss who pays attention to detail (he is a certified public accountant and was once a professor of accounting at the Far Eastern University and University of the East), knowing very well how small things can unmake great plans.
It was this fastidiousness and attention to detail that allowed him to grow RCBC from a small development bank when it opened in 1960 into the fifth-largest private domestic bank in the country today with total consolidated assets of almost P164 billion, and transform Malayan Insurance from a humble operation along Gandara Street into the Philippines' largest insurance firm at present.
Reaching Out
Another key to Yuchengco's success lies in how he values partnerships. RCBC, for instance, banked on its partnership with United Financial of Japan, one of the world's largest financial conglomerates, to help establish its presence in the global markets and strengthen its competitiveness on the local front among Japanese and other foreign clients. Great Pacific Life was born from a prospective partnership with the New India Assurance Corporation. The partnership was aborted when, just before launching, the New India chairman found out his company would be nationalized under Indian rules. Thankful for the crucial piece of information passed on to him, Yuchengco still values the chairman's friendship to this day.
Yuchengco's life demonstrates how important strategic alliances and partnerships are to him. It does not matter if the partner is a person, a company, or a country. All he knows is that in reaching out, much can be accomplished. He is still active in various civic, professional, and philanthropic organizations. A few years ago, he was named by then-President Fidel Ramos as a member of the National Centennial Commission tasked to take charge of the nationwide preparations for the 100th anniversary of Philippine independence in 1998.
The Businessman as Ambassador
The biggest proof of Yuchengco's dedication to his countrymen, however, was his willingness to leave the country to help Filipinos abroad. Yuchengco readily agreed to be named the country's ambassador to the People's Republic of China from 1986 to 1988 and to Japan from 1995 to 1998. In 2001, he was also named the Philippine's permanent representative to the United Nations with rank of ambassador.
These ambassadorial stints were very memorable for him. Japan, in particular, proved to be a very challenging post, especially when he found out that there were as many as 200,000 undocumented Filipinos there. Because of their immigration status, these Filipinos had no access to medical care, which is very expensive in Japan. Yuchengco recalls that there were even cases of sick Filipinos dying because they could not get the necessary medical attention.
He decided to sidestep various immigration restrictions by bringing in a Filipino doctor as an attaché of the embassy. That way, illegally staying Filipinos could just go to the embassy for medical care. That, of course, was kept under cover and Yuchengco was confident he was not going to be discovered. "I thought it was a secret, but at the end of my term, the Ministry of Foreign Affairs hosted a reception for me, and the minister was citing my accomplishments in Japan. One of the accomplishments he cited was that I brought to Japan a doctor to treat the Filipino patients," he laughs. He came home with the Grand Cordon of the Order of the Rising Sun presented to him in 1998 by His Majesty, the Emperor of Japan.
His stint in China, which came right after the first EDSA revolution, was equally interesting. "Deng Xiaoping was still alive. He was the paramount leader, and I watched him undertake various reforms." Since the Philippines was also in a transition phase, Yuchengco took advantage of opportunities to strengthen ties between the two countries. "The relationship between the Philippines and China improved tremendously," he said. Yuchengco left China the day before the Tiananmen Square massacre in 4 June 1989. "Had I known it would happen, I wouldn't have left," he rues.
After the stints in China and Japan, it is not surprising that he found his UN stay "very boring." In his short stint at the UN, he won a Security Council seat for the Philippines, the first time ever that the country was elected to the Security Council.
New Opportunities
The ambassador, however, could never shake out the businessman in him. In between his foreign postings, Yuchengco still managed to undertake important projects. He was, for example, among the taipans who formed Asia's Emerging Dragons Corporation in the early 1990s to undertake infrastructure projects for the country. He was elected chairman of AEDC.
In 1999, Yuchengco purchased the Mapúa Institute of Technology, known for having produced some of the country's best engineers. The acquisition is testimony to his commitment to help improve the Philippine educational system, but it also reflects his sentimental side. "My father used to be in the construction business with Engineer Mapúa," he recalls. He decided to acquire the university not only because he saw strong business opportunities but also because of his desire to preserve his father's business roots. Following the acquisition, the university has undergone a major upgrade, strengthening its capabilities to train students for both engineering and information technology. It has also opened a branch in Makati City.
Zest for Life
That Yuchengco, 83, remains strong and energetic today is probably due to his zest for life. He genuinely enjoys people. He prays and is devoted to the Blessed Mother. He swims daily and makes it a point to be at the office at 10:00 a.m. everyday. Most of all, he believes he is lucky.
Yuchengco possesses a streak of mischief and a sense of humor. "Personal integrity is very important to me. Money doesn't mean so much. I have been negotiating with St. Peter to just let me bring my money, because if I leave them with my children, they will just fight and only the lawyers will get rich. But so far, no answer," he deadpans, "so I just decided to give it to others."
By others, he refers to his various philanthropic causes. For instance, his substantial donation to the Our Lady of Peace Mission Foundation, through the AY Foundation he established in 1970, made possible the building of the Doña Maria H.T. Yuchengco Charity Ward along the Cavite Coastal Road. The foundation also has a university scholarship program for high school graduates who are chosen by their classmates not for intellectual superiority or academic standing but for their discipline and love of country. To them, he says, "Have a dream. If you have a dream, have a plan. Think out the plan. Analyze it."
This might as well be his guiding principle in life. In business and out of it, Alfonso Yuchengco has shown how dreams take shape with a dose of luck and a lot of planning.
Close window
One of the keys to the success of Alfonso Yuchengco, 83, is how he values partnerships, whether it is with a person, a company, or a country In business circles, his name is synonymous with banking and insurance. He saw the Yuchengco Group of Companies-composed of Rizal Commercial Banking Corporation, Pan Malayan Management and Investment Corporation, Great Pacific Life Insurance, House of Investments, and the Malayan Group of Insurance Companies-grow into the giant that it is today.
Though he jokes that he is "somewhat involved in the decision-making process, and sometimes, they follow me," Yuchengco, who is chairman of the group, is still very much updated with the goings-on in their subsidiaries and affiliated companies. Major plans still pass through him and he remains the strict boss who pays attention to detail (he is a certified public accountant and was once a professor of accounting at the Far Eastern University and University of the East), knowing very well how small things can unmake great plans.
It was this fastidiousness and attention to detail that allowed him to grow RCBC from a small development bank when it opened in 1960 into the fifth-largest private domestic bank in the country today with total consolidated assets of almost P164 billion, and transform Malayan Insurance from a humble operation along Gandara Street into the Philippines' largest insurance firm at present.
Reaching Out
Another key to Yuchengco's success lies in how he values partnerships. RCBC, for instance, banked on its partnership with United Financial of Japan, one of the world's largest financial conglomerates, to help establish its presence in the global markets and strengthen its competitiveness on the local front among Japanese and other foreign clients. Great Pacific Life was born from a prospective partnership with the New India Assurance Corporation. The partnership was aborted when, just before launching, the New India chairman found out his company would be nationalized under Indian rules. Thankful for the crucial piece of information passed on to him, Yuchengco still values the chairman's friendship to this day.
Yuchengco's life demonstrates how important strategic alliances and partnerships are to him. It does not matter if the partner is a person, a company, or a country. All he knows is that in reaching out, much can be accomplished. He is still active in various civic, professional, and philanthropic organizations. A few years ago, he was named by then-President Fidel Ramos as a member of the National Centennial Commission tasked to take charge of the nationwide preparations for the 100th anniversary of Philippine independence in 1998.
The Businessman as Ambassador
The biggest proof of Yuchengco's dedication to his countrymen, however, was his willingness to leave the country to help Filipinos abroad. Yuchengco readily agreed to be named the country's ambassador to the People's Republic of China from 1986 to 1988 and to Japan from 1995 to 1998. In 2001, he was also named the Philippine's permanent representative to the United Nations with rank of ambassador.
These ambassadorial stints were very memorable for him. Japan, in particular, proved to be a very challenging post, especially when he found out that there were as many as 200,000 undocumented Filipinos there. Because of their immigration status, these Filipinos had no access to medical care, which is very expensive in Japan. Yuchengco recalls that there were even cases of sick Filipinos dying because they could not get the necessary medical attention.
He decided to sidestep various immigration restrictions by bringing in a Filipino doctor as an attaché of the embassy. That way, illegally staying Filipinos could just go to the embassy for medical care. That, of course, was kept under cover and Yuchengco was confident he was not going to be discovered. "I thought it was a secret, but at the end of my term, the Ministry of Foreign Affairs hosted a reception for me, and the minister was citing my accomplishments in Japan. One of the accomplishments he cited was that I brought to Japan a doctor to treat the Filipino patients," he laughs. He came home with the Grand Cordon of the Order of the Rising Sun presented to him in 1998 by His Majesty, the Emperor of Japan.
His stint in China, which came right after the first EDSA revolution, was equally interesting. "Deng Xiaoping was still alive. He was the paramount leader, and I watched him undertake various reforms." Since the Philippines was also in a transition phase, Yuchengco took advantage of opportunities to strengthen ties between the two countries. "The relationship between the Philippines and China improved tremendously," he said. Yuchengco left China the day before the Tiananmen Square massacre in 4 June 1989. "Had I known it would happen, I wouldn't have left," he rues.
After the stints in China and Japan, it is not surprising that he found his UN stay "very boring." In his short stint at the UN, he won a Security Council seat for the Philippines, the first time ever that the country was elected to the Security Council.
New Opportunities
The ambassador, however, could never shake out the businessman in him. In between his foreign postings, Yuchengco still managed to undertake important projects. He was, for example, among the taipans who formed Asia's Emerging Dragons Corporation in the early 1990s to undertake infrastructure projects for the country. He was elected chairman of AEDC.
In 1999, Yuchengco purchased the Mapúa Institute of Technology, known for having produced some of the country's best engineers. The acquisition is testimony to his commitment to help improve the Philippine educational system, but it also reflects his sentimental side. "My father used to be in the construction business with Engineer Mapúa," he recalls. He decided to acquire the university not only because he saw strong business opportunities but also because of his desire to preserve his father's business roots. Following the acquisition, the university has undergone a major upgrade, strengthening its capabilities to train students for both engineering and information technology. It has also opened a branch in Makati City.
Zest for Life
That Yuchengco, 83, remains strong and energetic today is probably due to his zest for life. He genuinely enjoys people. He prays and is devoted to the Blessed Mother. He swims daily and makes it a point to be at the office at 10:00 a.m. everyday. Most of all, he believes he is lucky.
Yuchengco possesses a streak of mischief and a sense of humor. "Personal integrity is very important to me. Money doesn't mean so much. I have been negotiating with St. Peter to just let me bring my money, because if I leave them with my children, they will just fight and only the lawyers will get rich. But so far, no answer," he deadpans, "so I just decided to give it to others."
By others, he refers to his various philanthropic causes. For instance, his substantial donation to the Our Lady of Peace Mission Foundation, through the AY Foundation he established in 1970, made possible the building of the Doña Maria H.T. Yuchengco Charity Ward along the Cavite Coastal Road. The foundation also has a university scholarship program for high school graduates who are chosen by their classmates not for intellectual superiority or academic standing but for their discipline and love of country. To them, he says, "Have a dream. If you have a dream, have a plan. Think out the plan. Analyze it."
This might as well be his guiding principle in life. In business and out of it, Alfonso Yuchengco has shown how dreams take shape with a dose of luck and a lot of planning.
Close window
Sunday, January 8, 2006
People I Admire Series: Cesar Virata
(Cesar Virata was chairman of BusinessWorld the year I resigned. I admire him for trying to remain faithful to the ideals of Raul Locsin. Even if this conversation took place a month after I resigned from my corporate alma mater, I did not find it uncomfortable at all. In fact, this conversation was akin to walking down the pages of Philippine history for me. I do hope I could live up to my ideals of personal integrity the way Virata has.)
One man that many continue to look up to and see as the personification of integrity is Cesar Virata. Cesar Virata, 75, is still straight as an arrow, secure and complete in his knowledge and understanding of himself and of the world Filipinos continually lament the lack of role models that their children can look up to. For even in this age of shortcuts and instant gratification, Filipinos still maintain that idealism in their hearts.
No stranger to conflict, the Philippine prime minister from 1981 to 1986 and finance secretary/minister from 1970 to 1986 under President Ferdinand Marcos has had to defend what is right against the most formidable of influences and opponents, many times standing his ground in the face of bribes and death threats. Virata is still remembered for having fired 5,000 from the ranks of the Bureaus of Internal Revenue and Customs. President Marcos, known for his brilliance as well as his desire to surround himself with intelligent thinkers, somehow always found himself standing by the recommendations of his plucky finance minister.
Pofessional Relationship
Virata concedes that his relationship with Marcos was "very professional." Before he was called upon to join the government in 1967, he did not personally know the president. Virata, then in his late thirties, was a professor at the University of the Philippines and had been connected with the accounting firm SGV & Co. since 1956 when he was named to the Presidential Economic Staff. Apparently, former executive secretary Rafael Salas, who had worked with Virata at one point, had recommended him to Marcos.
Virata's first task as a member of the PES was to get the Exports Incentives Act passed in Congress. Having been instrumental in bringing Dole and United Fruit to the Philippines, he already recognized that businesses would need enormous support to be able to grow and compete in the world markets. He was eventually appointed undersecretary at the Department of Commerce and Industry, where he helped draw up the Investments Priority Plan. Virata was in the group that enabled the Philippines to take part in the Tokyo Round of the General Agreement on Tariffs and Trade after the country failed to gain admission to the Kennedy Round.
"He sized me up correctly," Virata says of Marcos. "He did not give me dirty assignments." In fact, he professes admiration for the former president's ability to listen to and understand issues. Ten days after Virata's appointment as finance secretary in February 1970, for instance, the Marcos administration was faced with the difficult decision whether to float the exchange rate. It was past five in the afternoon when he called the president, aware that the political situation was highly volatile. "Shall we go ahead (and float the rate)?" Virata asked Marcos. The International Monetary Fund needed an answer within the next 12 hours and the president had to make a decision. For Marcos, it would have been convenient to keep the exchange rate fixed, despite its debilitating effect on the economy. But as Virata would recall, Marcos instructed him to "go ahead, if it's the right thing to do."
Straight Shooter
A number of times, Marcos even reversed his decisions after hearing the opinions of his finance minister. In February 1986, for instance, Virata and Central Bank Governor Jose Fernandez got word that the government would make good on the losses sustained by the United Coconut Planters Bank because of the boycott instigated by then-opposition presidential candidate Corazon Aquino. Based on the information Virata and Fernandez received, Marcos had already signed the decree dictating the terms of this agreement.
Virata recalls going to Malacañang ready to tender his resignation if the president did not change his decision. Marcos, however, readily accommodated them to a meeting, and Virata and Fernandez requested that he repeal the decree "as this was not in accord with international practice." Marcos listened, and then instructed an assistant not to release the signed decree.
"That was our relationship," recalls Virata. "He knew I was ready to resign anytime there were disagreements." But somehow, Marcos saw the value of having a man of Virata's caliber in his Cabinet, and Virata never lost faith in working with the Philippine government.
It would be wrong to conclude, however, that Virata was blind to the Marcos government's failings. He was quite vocal in his observations. In the aftermath of the assassination of former senator Benigno Aquino Jr. in 1983, he told a Financial Times reporter he met at a UN meeting in Istanbul that he "would not discount that some elements in government had a hand" in it. His statement, of course, drew an uproar. Government representatives tried to persuade Virata to retract the statement or to say he was misquoted. "But I said no, I will not retract it, in fact, I will repeat it," recounts Virata. When he reached Philippine shores, this was exactly what he did.
Moving On
It has been almost two decades since Virata vacated his government post in 1986, but there has been no let-up in his daily activities. After the first EDSA Revolution, he went into private consultancy. "I had so many cases, who would want to employ me?" he laughs in recollection. But even if he had all sorts of hold orders and court appearances to contend with, the stigma of being Marcos's prime minister did not last very long. In fact, his first client was the World Bank, which sent him on a three-month assignment abroad focusing on highly indebted countries.
Not long after, he was advising companies on their acquisitions, among them, the National Steel Corporation and Petron. In 1987, he became a member of the advisory board of Metrobank. The following year, Ambassador Alfonso Yuchengco asked him to join Rizal Commercial Banking Corporation, where Virata still sits as corporate vice chairman.
Today, Virata brings the same ideals that saw him through those tumultuous years of government service in his dealings in RCBC, with the Bankers Association of the Philippines, and with all other organizations he is involved with. Corporate governance is his advocacy, and one that he desires to bring to as many Philippine companies as possible. His private consultancy continues to do well, and his Quezon City office remains where it used to be. Virata is still straight as an arrow, secure and complete in his knowledge and understanding of himself and of the world.
Virata is not one to talk of personal legacies, but his work will surely define this for him. He admits he is proud of the work he has done for Philippine business, counting the Tax Code, Tariff Code, Insurance Code, and the development of export processing zones among his accomplishments. He is also pleased to have helped increase the country's budget considerably, from P4 billion when he started in the 1970s to P99 billion in 1986.
Of course, he accedes that there are still so many areas to which he would have wanted to make a contribution, especially environmental protection and population control, his biggest frustrations to date. "In the position I achieved accidentally, the horizon is so broad," Virata says. That he managed to focus on what counts the most is something that Filipinos will always thank him for.
Close window
One man that many continue to look up to and see as the personification of integrity is Cesar Virata. Cesar Virata, 75, is still straight as an arrow, secure and complete in his knowledge and understanding of himself and of the world Filipinos continually lament the lack of role models that their children can look up to. For even in this age of shortcuts and instant gratification, Filipinos still maintain that idealism in their hearts.
No stranger to conflict, the Philippine prime minister from 1981 to 1986 and finance secretary/minister from 1970 to 1986 under President Ferdinand Marcos has had to defend what is right against the most formidable of influences and opponents, many times standing his ground in the face of bribes and death threats. Virata is still remembered for having fired 5,000 from the ranks of the Bureaus of Internal Revenue and Customs. President Marcos, known for his brilliance as well as his desire to surround himself with intelligent thinkers, somehow always found himself standing by the recommendations of his plucky finance minister.
Pofessional Relationship
Virata concedes that his relationship with Marcos was "very professional." Before he was called upon to join the government in 1967, he did not personally know the president. Virata, then in his late thirties, was a professor at the University of the Philippines and had been connected with the accounting firm SGV & Co. since 1956 when he was named to the Presidential Economic Staff. Apparently, former executive secretary Rafael Salas, who had worked with Virata at one point, had recommended him to Marcos.
Virata's first task as a member of the PES was to get the Exports Incentives Act passed in Congress. Having been instrumental in bringing Dole and United Fruit to the Philippines, he already recognized that businesses would need enormous support to be able to grow and compete in the world markets. He was eventually appointed undersecretary at the Department of Commerce and Industry, where he helped draw up the Investments Priority Plan. Virata was in the group that enabled the Philippines to take part in the Tokyo Round of the General Agreement on Tariffs and Trade after the country failed to gain admission to the Kennedy Round.
"He sized me up correctly," Virata says of Marcos. "He did not give me dirty assignments." In fact, he professes admiration for the former president's ability to listen to and understand issues. Ten days after Virata's appointment as finance secretary in February 1970, for instance, the Marcos administration was faced with the difficult decision whether to float the exchange rate. It was past five in the afternoon when he called the president, aware that the political situation was highly volatile. "Shall we go ahead (and float the rate)?" Virata asked Marcos. The International Monetary Fund needed an answer within the next 12 hours and the president had to make a decision. For Marcos, it would have been convenient to keep the exchange rate fixed, despite its debilitating effect on the economy. But as Virata would recall, Marcos instructed him to "go ahead, if it's the right thing to do."
Straight Shooter
A number of times, Marcos even reversed his decisions after hearing the opinions of his finance minister. In February 1986, for instance, Virata and Central Bank Governor Jose Fernandez got word that the government would make good on the losses sustained by the United Coconut Planters Bank because of the boycott instigated by then-opposition presidential candidate Corazon Aquino. Based on the information Virata and Fernandez received, Marcos had already signed the decree dictating the terms of this agreement.
Virata recalls going to Malacañang ready to tender his resignation if the president did not change his decision. Marcos, however, readily accommodated them to a meeting, and Virata and Fernandez requested that he repeal the decree "as this was not in accord with international practice." Marcos listened, and then instructed an assistant not to release the signed decree.
"That was our relationship," recalls Virata. "He knew I was ready to resign anytime there were disagreements." But somehow, Marcos saw the value of having a man of Virata's caliber in his Cabinet, and Virata never lost faith in working with the Philippine government.
It would be wrong to conclude, however, that Virata was blind to the Marcos government's failings. He was quite vocal in his observations. In the aftermath of the assassination of former senator Benigno Aquino Jr. in 1983, he told a Financial Times reporter he met at a UN meeting in Istanbul that he "would not discount that some elements in government had a hand" in it. His statement, of course, drew an uproar. Government representatives tried to persuade Virata to retract the statement or to say he was misquoted. "But I said no, I will not retract it, in fact, I will repeat it," recounts Virata. When he reached Philippine shores, this was exactly what he did.
Moving On
It has been almost two decades since Virata vacated his government post in 1986, but there has been no let-up in his daily activities. After the first EDSA Revolution, he went into private consultancy. "I had so many cases, who would want to employ me?" he laughs in recollection. But even if he had all sorts of hold orders and court appearances to contend with, the stigma of being Marcos's prime minister did not last very long. In fact, his first client was the World Bank, which sent him on a three-month assignment abroad focusing on highly indebted countries.
Not long after, he was advising companies on their acquisitions, among them, the National Steel Corporation and Petron. In 1987, he became a member of the advisory board of Metrobank. The following year, Ambassador Alfonso Yuchengco asked him to join Rizal Commercial Banking Corporation, where Virata still sits as corporate vice chairman.
Today, Virata brings the same ideals that saw him through those tumultuous years of government service in his dealings in RCBC, with the Bankers Association of the Philippines, and with all other organizations he is involved with. Corporate governance is his advocacy, and one that he desires to bring to as many Philippine companies as possible. His private consultancy continues to do well, and his Quezon City office remains where it used to be. Virata is still straight as an arrow, secure and complete in his knowledge and understanding of himself and of the world.
Virata is not one to talk of personal legacies, but his work will surely define this for him. He admits he is proud of the work he has done for Philippine business, counting the Tax Code, Tariff Code, Insurance Code, and the development of export processing zones among his accomplishments. He is also pleased to have helped increase the country's budget considerably, from P4 billion when he started in the 1970s to P99 billion in 1986.
Of course, he accedes that there are still so many areas to which he would have wanted to make a contribution, especially environmental protection and population control, his biggest frustrations to date. "In the position I achieved accidentally, the horizon is so broad," Virata says. That he managed to focus on what counts the most is something that Filipinos will always thank him for.
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