Increasing Dutch investments in Philippines tied to Joma arrest

Sep. 02, 2007

MANILA - Does the increasing number of Dutch investments in the Philippines have anything to do with the arrest last week in the Netherlands of Filipino communist leader Jose Maria Sison? Sisons supporters in the Philippines certainly think so.

Anakpawis Rep. Crispin Beltran, in a statement on Saturday, said the Arroyo government recently approved an oil exploration project by British, US and Dutch companies and that this, among others, may have helped close the deal of cooperation between Malacanang and the Dutch government to raid the office of the National Democratic Front in Utrecht and arrest Sison, its chief political consultant.

The project, Beltran said, involves exploration and drilling for oil within a million hectares of agricultural and fishing areas in Bicol.

Earlier this month, he disclosed, Premier Oil was granted the right to drill an exploration well within Service Contract 43 in the Ragay Gulf. Premier Oil has earmarked between $3.6 million and $9.6 million to drill its first exploration well within the contract area, he said. Based on pre-drilling estimates, he said, the company hopes to tap an oil reserve of 20 million barrels in the area.

“By compromising national patrimony to the Dutch and allowing their companies full and unhampered access to Philippine natural resources, the Arroyo government was able to secure a deal with the Dutch government to go after Prof. Sison and the NDF in the Netherlands. The Arroyo government has virtually turned over the gas reserves of Malampaya, the mineral resources of the indigenous people’s tribal lands, and the Moro to multinational corporations, including those of the Dutch,” Beltran said.

Beltran also said that the Dutch government offers extensive grants, subsidies and incentives for development projects in the Philippines. The following is a list provided by Beltran of the said grants/subsidies/incentives from the official website of the Philippine embassy in the Netherlands:

1) PESP- Program for Economic Cooperation Projects. This is open to consortia of Dutch and Philippine companies that are involved in activities leading up to export transactions from the Netherlands. The activities may be feasibility studies (but not market research for individual companies), project identification and investment preparation studies. The program grants a maximum of 66.67% of the estimated cost, but not more than 140,000. This program is administered by EVD (formerly Senter Internationaal), the Agency for International Business and Cooperation of the Ministry of Economic Affairs.

2) PSOM- Emerging Markets Cooperation Program. This is open to consortia of Dutch company and Philippine counterparts that are involved in poverty-alleviation pilot projects which would lead to follow-up investments.

The financial feasibility of the project should be that it could not be financed by commercial banks. The contribution of PSOM to the project is a maximum of 50% of the project cost, but not more than 500,000. This program is also administered by EVD.

3) ORET Development-related Export Transactions Program (includes MILLIEV -Environment and Economic Self-sufficiency Program). This is open to Dutch companies which intend to undertake projects in the Philippines which are considered commercially non-viable by OECD standards.

The main aim is to stimulate commercial activity and enhance job opportunities and at the same time incraese Dutch exports to the beneficiary country. The program grants a maximum of 35% of the estimated cost of the project, but not more than 45 million.

This is administered by FMO, the Netherlands Development Finance Company, in coordination with the Ministry of Foreign Affairs – Dutch Embassy.

4) FMO Netherlands Development Finance Company. This is the Netherlands’ international development bank. It primarily provides soft loans to business projects in developing countries. It also participates in equity investments in commercial undertakings, in cooperation with other foreign development banks. It has a subsidiary known as NIO Netherlands Investment Bank for Developing Countries.

In addition to ORET, FMO also administers special assistance programs for developing countries. Dutch companies in the Philippines are eligible for grants under the following programs:

a) IPTA Investment Promotion and Technical Assistance. This program provides short-term support to investment promotion activities such as feasibility studies, job-related training and temporary management. The grant covers 50% of the cost, with a maximum of 275,000.

b) TAEM Technical Assistance Emerging Markets. This program subsidizes management support and/or training to Dutch SMEs making a sustainable but risk-bearing investment in a developing country. The grant covers 50% of the cost, with a maximum of 275,000.

5) PUM Netherlands Senior Experts. This program provides Dutch technical experts for business projects in developing countries. These experts are usually retired management executives who volunteer as consultants without pay. PUM pays for the international transportation, and the local companies are expected to shoulder the accommodation and daily food allowance.

Beltran said that many Dutch companies maintain significant business ventures in strategic industries, including the following: oil industry (Royal Dutch Shell), petroleum trading, oil and gas exploration (Vitol Group), consumer product brands in foods, beverages and personal care products (Unilever), banking (ABN-AMRO), insurance (AXA-Life), coco coir export (Rinos B.V-Corion), consumer electronics (Phillips), retail industry (Makro), solar energy (Shall Solar Philippines, Inc) among others. The largest businesses maintained by Dutch corporations in the country are in the outsourced business processes (Getronics, ING Group, KLM Royal Dutch Airlines, Bickers Law Firm, Bickers Corporate and Bickers Public Solutions). (

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