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.