DAVAO CITY—The management of the Floirendo-owned Tagum Agriculture Development Co. Inc. (Tadeco) has maintained that the joint-venture agreement (JVA) to maintain a banana plantation inside the penal farm in Davao del Norte since 1956 is “legal and advantageous to [the] government”.
The Tadeco statement came after the scion of the Floirendo family, Davao del Norte Rep. Antonio R. Floirendo Jr., also belied the suspicion of House Speaker Pantaleon D. Alvarez that he was masterminding the move to oust the latter from his post.
Last week Alvarez filed House Resolution 867 to investigate the “grossly disadvantageous” 25-year “lease contract” signed by the Bureau of Corrections (BuCor) and Tadeco. In a statement issued on Wednesday, Floirendo corrected Alvarez, saying it was not a lease but rather a JVA.
Alexander N. Valoria, president and CEO of the Antonio O. Floirendo Management and Investment Corp. (Anflocor), told the BusinessMirror on Wednesday the operations of the agreement have been “above board” and were always upheld on several occasions that it has undergone review.
“This joint-venture agreement has been reviewed several times, everytime a new administration takes over, or a new administrator of the Department of Justice or the Bureau of Corrections takes the helm of these agencies,” he said.
And after each review, Tadeco said in the same statement that “the JVA has been reviewed, and found to be advantageous to the government numerous times by the Executive and the Legislative departments in past administrations.”
“In fact, the most recent review in the 15th Congress in 2012 once again arrived at the same positive conclusion regarding the JVA and its benefits to the government. The Department of Justice, through its representative, Atty. Teresita Domingo, said during the congressional review that the JVA is actually above board,” the statement added.
Valoria said that even former President Benigno S. Aquino III, who was a senator then, “sat at the Blue Ribbon Committee reviewing this agreement”.
Valoria said the agreement has always upheld its commitment to compensate inmates at the Davao Prison and Penal Farm (formerly called Davao Penal Colony, or Dapecol) minimum wage since it was started in 1956, when the former idle penal farm of 500 hectares was developed into an abaca plantation.
Tadeco shifted to banana in 1969, and still retains the same provisions in the JVA. He said it would be the Dapecol management that would identify the “prisoners of good standing” to work in the banana plantation.
Valoria said the BuCor, or the Dapecol, has a pool of 900 prisoner workers, “as part of the rehabilitation of the prisoners. The Dapecol usually fields about 600 prisoners in a day’s work.
“Actually, this is the core of the agreement: To help the government in providing a good correctional and rehabilitation program for convicts. In much later years, many of these former prisoners were eventually hired by other plantations when they had served their prison terms.”
The Dapecol farm that Tadeco developed into a banana plantation is currently 5,318 hectares. “This is the part of the total banana plantation profile tilling more than 8,000 hectares, including the Floirendo-owned plantations in Davao del Norte and in other expansion areas in Mindanao.”
The Tadeco is part of the 17 companies managed by the Anflocor, which manages other businesses engaged in agriculture, container port terminal operation, packaging production, real estate, trucking, resort development, food production and services, merchandising, financing and radio operation.
Anflocor has also forged other joint ventures with other local companies to expand its operations into mall, hotel and urban residential development.
Top banana producer
In pushing for a review of what he called “lease contract”, Alvarez directed the House Committee on Good Government and Accountability to look into where he said the “government would get a guaranteed payment of P26.542 million per year for using the Davao Penal Colony’s 5,308 hectares of land”.
“Tadeco and the BuCor executed a consolidated JVA dated September 26, 1979, in which the former leased 5,212.46 hectares of land from the latter, and combines the provisions of said joint venture agreement and all its amendments and supplements into a single instrument that will serve as the sole repository of the terms and conditions thereof; and extended the lease period to 25 years, interestingly, instead of the reported prevailing practice of leasing with a term of just 10 years,” Alvarez said.
In 1989 Alvarez’s resolution said the consolidated joint venture agreement was amended to escalate rates in land rentals, royalties and profit shares.
On May 21, 2003, Alvarez said it was renewed, and based on the new contract, the BuCor shall receive a guaranteed annual production share of P26.54 million, which will automatically increase by 10 percent every five years.
In a company statement, Tadeco said Alvarez’s claim “is entirely false”.
“The arrangement between Tadeco and the BuCor is not a lease arrangement but a joint venture that is primarily aimed at the rehabilitation of the inmates in Davao Penal Colony. This rehabilitation program has been found to be very successful by BuCor, to the extent that the latter has even requested Tadeco to replicate the JVA program to its penal colony in Iwahig, Palawan,” the statement read.
Valoria said Tadeco has sent two missions to look into the situation in Iwahig, but there had been no outstanding recommendations yet to start one project there.
Tadeco said, “There is no truth to the allegation of ill-treatment of its workers in the plantation. Such allegation is completely baseless. This is evident in the high production yield of Tadeco, indicating that the workers are well motivated and very productive. In fact, among all the banana companies in the Philippines, Tadeco has been branded as a champion on labor and community relations.”
Valoria said Tadeco was the highest banana producer among the 33 prominent members of the Pilipino Banana Growers and Exporters Association “without incurring any debt so far”.
The company said it was “a regular recipient of awards in the field of labor-management relations. In two successive occasions [in 2013 and 2015], Tadeco won the Outstanding Labor-Management Cooperation for Industrical Peace Award given by the Philippine League of Labor Management Cooperation Practitioners in coordination with the National Conciliation and Mediation Board.”
It admitted, however, that when the agreement was renewed in 2004, “the rates jointly agreed therein were the most competitive rates prevailing at that time”.
“As can be understood, the changes in economic conditions over the past 13 years have affected the competitiveness of such rates. Tadeco understands this and stated back in 2011 its willingness to discuss and adjust the rates as it had done in the past,” it added.
No ouster move
In a separate statement, Floirendo, who also sits as chairman of the board of Anflocor, said Alvarez’s probe of the Tadeco deal “all started with the rumor that I was behind a plot to oust Speaker Pantaleon Alvarez and have him replaced by former president and now Rep. Gloria Macapagal-Arroyo”.
“I did not give any statement then to defend myself as there was no truth to it at all. I never attempted to talk to Arroyo nor would I ever support any plot to oust Speaker Alvarez, who, in the first place, is a good friend of mine and whom I fully supported during the last election and in his bid for the speakership,” he said.
“If ever there is an iota of truth to the ouster plot, I am 100 percent not a part of it. Let me make it clear that Speaker Bebot [Alvarez] and I have no fight with each other. If ever there is a conflict, it could be likened to a brotherly misunderstanding, which I am sure would be patched up in no time at all,” he added.
Floirendo said he “tried and reached out to him but he refused to talk to me since this all started”.
“Admittedly, I am hurt with the action of Speaker Alvarez against me. It not only affects me, but also my family, as well as the people of Davao del Norte. But that’s politics. What is important is that I know deep down my conscience that I have not done anything wrong nor have I committed any criminal act,” he said.
However, he said he would welcome any complaint to be filed against him.
Image credits: AP/Aaron Favila