POSTSCRIPT / September 27, 2001 / Thursday

By FEDERICO D. PASCUAL JR.

Philippine STAR Columnist

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Why was GSIS eased out in Napocor bidding?

NPC-GSIS FEUD OVER?: Two different public biddings were originally scheduled today for the reinsuring of the multibillion-peso assets of the National Power Corp. — one to be conducted by its insurer the Government Service Insurance System and another by a presidential committee.

Why two biddings? The Napocor and its insurer GSIS could not agree on which brokers should be qualified to bid for the reinsurance of the assets of the power firm.

A hint of how much they are fighting over is that the insurance premium paid this year was $13.874 million. With war jitters having escalated rates by 50 to 100 percent, the premium is expected to be now in the region of $20-$27 million.

As we were finalizing this column, however, we got a rush advice that the GSIS has decided to cancel its own bidding in deference to Finance Secretary Jose Isidro N. Camacho.

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CHOOSING REINSURERS: The current insurance of Napocor lapses by Monday. In view of the tight timing, the GSIS has been insisting on automatically pre-qualifying the top 10 insurers of the world and throw everything to an open, transparent bidding.

Napocor agreed in principle, but its president Jesus Alcordo wanted first to disqualify the world’s No. 1 insurance broker, Marsh and Mc Lennan Cos. Inc., and the No. 5, Jardine Lloyd Thomson, which is the current lead reinsurance broker of Napocor properties.

Insiders have told us that Alcordo had openly batted for AON Corp., the No. 2 broker represented locally by the Ayala Group. They said Alcordo had been pushing also for the qualifying of a multinational broker called “Higgins,” which is not among the Top 10 and is a total unknown to the GSIS.

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IT’S GSIS’ OWN BUSINESS: There is a basic legal and business issue that must be settled, or accepted, if the friction between the GSIS and its biggest client Napocor is to be smoothed out with finality and without further embarrassing President Gloria Macapagal Arroyo.

All these years, GSIS mandated by law as the insurer of all government assets has chosen the reinsurers that would share its risks. But this time, suddenly Napocor — the biggest GSIS client — wants to pick the reinsurers.

GSIS president and general manager Winston F. Garcia has said it is not Napocor’s business how GSIS should manage its own insurance risks. He cites the law, the GSIS charter and business logic as basis for this.

In a letter to Alcordo, Garcia said: “NPC does not have any right whatsoever to dictate upon GSIS how its reinsurance securities will be placed and through which reinsurance brokers are they going to be secured. Your insistence in doing so is very intriguing and suspicious.”

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BIG EMBARRASSMENT: The spectacle of two pubic biddings — which is obviously a fight not only over turf but also over millions in commissions — was potentially a big embarrassment for President Arroyo after she has been drawn into refereeing the fight.

To forestall the feud, the President created a five-member committee headed by Secretary Camacho to take over the bidding. The GSIS and the Napocor were given two representatives each in the committee. There were indications, however, that Camacho weighed in on the side of Napocor.

An angry Garcia and his senior vice president pulled out early yesterday from the committee and announced that GSIS would go ahead with its own bidding today. But the dispute was patched up last night and Garcia said they would respect the committee bidding.

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PRIVATIZATION ON TRACK: Energy Secretary Vicente Perez said, meanwhile, that the privatization of Napocor would proceed as scheduled later this year. The planned $5-billion privatization will be the biggest in Philippine history.

A roadshow is scheduled for December. Foreign investors, particularly Europeans and Americans, have expressed keen interest in acquiring Napocor. Presumably, they will work with local partners who have the right connections.

Perez also announced the commissioning of the $5-billion Malampaya gas project by October. This is majority owned by the Royal Dutch Shell Group, along with minority partner Texaco, and PNOC.

Malampaya will be a major energy source for the Philippines for the next 20 years, and is expected to generate about $1-2 billion annually in revenues. It will substantially reduce the country’s oil bill.

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SHIFT TO GOLD: Word has it that after the Sept. 11 terrorist attacks at the World Trade Center and the Pentagon, Japanese investors unloaded their American dollar hoards and switched to gold. The metal is considered a safe haven especially in times of war.

Approximately three tons of gold were sold to Japanese investors right after the attacks. The gold bought by the Japanese was on top of the 21 tons earlier purchased by Japan for the first six months of 2001. The figures come from the World Gold Council.

According to WGC, other Asian countries are also unloading their US dollars and switching to gold.

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HOW TO BEAT HIJACKERS: From Sister M. Myra Seratubias, OSF, comes this copy of an inspiring letter of her friend after she flew in from Washington, DC, days after the terrorist attacks in the US:

I just wanted to drop you all a note and let you know that I arrived safe and sound into Dulles Airport tonight (Sept. 15) at about six. It was an interesting flight.

The airport in Denver was almost spooky, it was so empty and quiet. No one was in line for the security check point when I got there so that went fairly quickly, just x-ray of my bags and then a chemical test to be sure nothing explosive was on them. Then I waited 2 ½ hours to board the plane. What happened after we boarded was interesting and thought I would share it with you.

The pilot/captain came on the loudspeakers after the doors were closed. His speech went like this:

First I want to thank you for being brave enough to fly today. The doors are now closed and we have no help from the outside for any problems that might occur inside this plane. As you could tell when you checked in, the government has made some changes to increase security in the airports.

They have not, however, made any rules about what happens after those doors close. Until they do that, we have made our own rules and I want to share them with you.

Once those doors close, we have only each other. The security has taken care of a threat like guns with all of the increased scanning, etc. Then we have the supposed bomb. If you have a bomb, there is no need to tell me about it, or anyone else on this plane; you are already in control. So, for this flight, there are no bombs that exist on this plane.

Now, the threats that are left are things like plastics, wood, knives, and other weapons that can be made or things like that which can be used as weapons. Here is our plan and our rules.

If someone or several people stand up and say they are hijacking this plane, I want you all to stand up together. Then take whatever you have available to you and throw it at them. Throw it at their faces and heads so they will have to raise their hands to protect themselves.

The very best protection you have against knives are the pillows and blankets. Whoever is close to these people should then try to get a blanket over their head — then they won’t be able to see. Once that is done, get them down and keep them there. Do not let them up.

I will then land the plane at the closest place and we will take care of them. After all, there are usually only a few of them and we are 200-plus strong! We will not allow them to take over this plane.

I find it interesting that the US Constitution begins with the words “We, the people…” — that’s who we are, the people and we will not be defeated. With that, the passengers on the plane all began to applaud, people had tears in their eyes, and we began the trip toward the runway.

The flight attendant then began the safety speech. One of the things she said is that we are all so busy and live our lives at such a fast pace. She asked that everyone turn to their neighbors on either side and introduce themselves, tell each other something about your families and children, show pictures, whatever.

She said, “For today, we consider you family. We will treat you as such and ask that you do the same with us.”

Throughout the flight we learned that for the crew, this was their first flight since Tuesday’s tragedies. It was a day that everyone leaned on each other and together everyone was stronger than any one person alone.

It was quite an experience. You can imagine the feeling when that plane touched down at Dulles and we heard “Welcome to Washington Dulles Airport, where the local time is 5:40.” Again, the cabin was filled with applause.”

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(First published in the Philippine STAR of September 27, 2001)

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