POSTSCRIPT / May 11, 2000 / Thursday

By FEDERICO D. PASCUAL JR.

Philippine STAR Columnist

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Erap, fuel consumers look for golden mean

WITH Mindanao figuratively in flames and the Estrada administration apparently unable to contain the conflagration, it is wise for President Estrada to postpone his projected state visit to China this month.

Anyway China will still be there next year, and the next, through 2004. There will be other chances for a neighborly visit before Erap Estrada and his traveling troupe vacate Malacañang.

Beijing would, or should, understand that a postponement for compelling domestic reasons is not a cancellation but a mere rearrangement of time schedules, something all heads of government sometimes have to do.

* * *

PRESIDENT Clinton, leader of the most powerful nation, sometimes postpones major foreign trips when a problem requires his undivided attention. Actually, his staff could handle problems even if he is not in the White House, but he makes it a point to stay.

Friends and officials tagging along could be expected to advise President Estrada to stick to the travel schedule. They could even try pricking his machismo with the line that postponement might give the impression that a ragtag bunch of bandits has succeeded in intimidating him.

But if Erap has overcome his complexes by now and finally matured as president, he should be able to distinguish between his friends’ importuning versus the interest of the people and his own presidency.

* * *

WITH piracy a booming industry in these parts, all that Congress has to do if the subject is too complicated for its brain trust is to get a copy of the US laws regulating the use of cyberspace and rewrite them to suit our purposes.

It’s a legislative form of piracy all right, but how else can we leap from the carabao stage to the high-tech world swirling around us?

If we wait till we can muster the brain power to catch up with the rest of the civilized world, we’ll never be able to write our own laws for such a simple thing as sending an email or shopping through the Internet.

This yawning legal hole was discovered when the suspected creator of the devastating ILOVEYOU computer virus had to be set free for lack of a law to pin him down.

It could also be lack of evidence, considering how clumsy are our native investigators in carrying out the orders of pushy agents of the Federal Bureau of Investigation who came over demanding action.

Or it could be that the youthful Pinoy suspect is really innocent.

* * *

ANOTHER lesson in law has just been imparted to us non-lawyers: It is the law that makes a crime, and it is the crime that makes a criminal.

If there is no law saying that an act is a crime, such an act is not a crime however “bad” it may seem, and the perpetrator is not a criminal.

For instance, if we have no law declaring it criminal to give instructions to a computer to do such nasty things as corrupting files or erasing the contents of the hard disk of a computer, that act is not a crime even if it is such in the great US of A.

Since our Constitution does not allow the passage of laws with retroactive penal effect, the creation of the destructive LuvBug cannot be covered, and its creator punished, by a law still to be passed. The police have to look for another law to pin him down.

* * *

REP. Enrique Garcia, author of the bill creating a National Oil Commission (OilEx), was scheduled to give us yesterday his reaction to our compromise formula that would see the big oil companies coexisting with the OilEx in a deregulated fuel market.

But the Bataan congressman got bogged down in a hearing of a House committee, so he begged off and promised to send his position paper in the next few days.

Petron Chairman Jose Syjuco Jr. was the first of the major protagonists to react. He was amenable to our compromise formula, provided, he said: (1) the OilEx can secure the funds for its operation, (2) the existing oil companies are not forced to buy their supplies through it, and (3) the OilEx will not enjoy government subsidies and thus compete on equal terms with the other oil companies.

We’ve been informed that Shell and Caltex are also finalizing their reactions. Meanwhile, consumers have been sending their own comments, which are generally supportive of our formula.

* * *

FOR the benefit of those who were not taking notes, we repeat the general lines of our compromise formula:

  • The oil firms will keep their refineries, storage facilities and gas stations to retail their branded products. They can join the international bidding to be called by the National Oil Exchange, but will not be required to buy refined products from the OilEx.
  • Operating parallel to them, the National Oil Exchange proposed by Garcia will buy gasoline, diesel and other petroleum products directly from the lowest bidder anywhere in the world. The OilEx will store its supply initially in the Subic-Clark depots left by the Americans, and compete with the Big 3.

* * *

WE felt it was time to step in with a compromise since the oil debate has dragged on too long. While we waste time and saliva, the harassed consumer continues to suffer in a fuel market dominated by prices dictated the giant oil companies.

The reality is that neither the Big 3 nor congressman Garcia can win them all. While an avaricious oil cartel is not acceptable, the OilEx as proposed by Garcia would just replace it with a state monopoly with no guarantee of more stable supply and prices of oil products

There has to be some adjustments, some accommodation on both sides. We imagine that even President Estrada, who is caught between the opposing camps, is looking for a middle ground. We have offered our compromise formula.

* * *

SOME readers’ reactions to our compromise formula:

Michael de Jesus: “I’m a Filipino doing some business in Singapore, Thailand and Taiwan. I believe the ‘Pascual Formula’ is quite possibly a breakthrough and a profound service to the nation.

“Finally, we hear a proposal that first considers the requirements of business without discounting the participation of the state in the free market! The beauty of this proposal is that it does not threaten the legal framework of deregulation, thus, having a neutral effect on the country’s investment climate.

“On the operational side, downscaling the OilEx idea outside of the Big 3 renders the proposal more realistic as one does away with the preposterous suggestion of buying out the three oil refineries as well as over 100 storage depots and installations operating in the Philippines.”

* * *

PRISCILE Yap Bahjin: “I first encountered the name ‘OilEx’ in your column. Now, with the Pascual Formula, I must say that your inputs to public policy are as remarkable as your penchant for coining terms.

“I hope Rep. Garcia can take the hint and realize that a genuine concern for the Philippines’ welfare requires the ‘mutual accommodation’ and cutting short the protracted debates that have left us nothing concrete until now.

“However, I find it mind-boggling (to use a term of Rep. Garcia) how government will cough up the capitalization required to finance initial inventory. A 25-percent share of the entire market represents some 90,000 barrels of crude daily or a daily working capital of about $2 million (P82 million). Thirty days’ stock cover will thus need a whopping P2.5 billion.”

* * *

ELINO V. Crisostomo, with a Petron address, says: “There is no need for the OilEx as proposed by congressman Garcia or your compromise proposal as the Philippine National Oil Co. already exists. PNOC owns 40 percent of Petron Bataan refinery, which is the largest refinery in the country. Maybe, there is a need to review the charter of PNOC to expand its function.

“PNOC also owns a big parcel adjacent to the Bataan refinery and the Petrochem complex which could be converted into a new refinery complex that includes storage depot for crude and petroleum products. There’s a plan for an additional refinery complex that could be integrated with the existing Bataan refinery and Petrochem complex so that naphtha cracker project could take off.

“Maybe PNOC could take the lead. It is better to do the refining here than merely import petroleum products because this is good for the economy. It is unfortunate that congressman Garcia is not thinking this way, considering that his constituents in Bataan are the ones who will be directly hit by his proposed OilEx.”

* * *

ARTURO Aquitania, civil engineer, California Department. of Transportation: “I’ll bet that if the oil products were deregulated, the prices would go up because the Big 3 and OilEx would be talking with each other and fixing prices. There would be no genuine competition because the prices would vary only a few centavos in different stations.”

Ernesto Canizares, Cubao, Quezon City: “The OilEx will just be another inefficient government corporation that will not serve its purpose and become a big burden on the people, just like National Power Corp.”

Manuel C. Diaz, US-based geologist: “The OilEx could lease oil tankers and moor them in strategic locations like Cebu, Cagayan De Oro , Davao City and other locations with existing pier facilities and use them as floating storage facilities and distribution centers. The Oil Exchange then could compete with the oil cartel. The OilEx does not have to build expensive onshore tank farms. This system was used to fast-track the exploitation of the Palawan oil fields.”

* * *

(First published in the Philippine STAR of May 11, 2000)

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