Story & photos by Recto Mercene
“AFTER 20 years ‘mooing’ outside the Philippines, British beef has finally returned, and we’re ‘beefing’ up our presence in the Philippines,” remarked British Prime Minister’s trade envoy to the Philippines Richard Graham MP while we were cruising onboard a luxury yacht.
“Blimey,” this reporter said secretly in his head, “this ruddy Englishman is dispensing bon mots into the salty air of Manila Bay!”
We laughed together at his witticism. The talks turned serious as Graham answered our queries about him traveling halfway around the world and staying here in the country for weeks.
“The compelling reason for coming to the Philippines, is first, that as Prime Minister [Theresa May]’s trade envoy to the Philippines, I promised to her that I would try to come twice a year to help my friends and colleagues in the embassy do the excellent jobs they are doing, and finding win-win partnerships with Philippine businesses, either for Filipino companies to invest in the United Kingdom, or British companies to invest here and to help exports to the Philippines.”
That was a mouthful. Anyway, we were enjoying the ride back to the Manila Yacht Club after our visit to the Mariveles Port in Bataan, where the UK has some financial exposure.
Accompanying Graham in the yacht are UK Ambassador to the Philippines Daniel Pruce, Trade and Investment Director Mike Moon, Vice Chairman and a Director of Platinum Group Metals Corp. and International Gateways & Port Management Services Philippines Inc. Ramon Atayde, Global Ferronickel Holdings Inc. President Dante Bravo and Seasia President and CEO Ludette Querubin, among many other prominent business personalities.
Officials from the Freeport Area of Bataan gave the group a tour of the facilities, preceded by a briefing showing the many infrastructures that make this remote location in the corner of Manila Bay a first-class locale.
With Bataan Gov. Albert Garcia, Graham discussed potential infrastructure development in the burgeoning Bataan hub, a dry-bulk cargo port operated by Seasia Nectar Port Services Inc. (SNPSI), a part of UK’s Nectar Group that was partly funded by UK-Export Finance (UKEF).
The UK trade rep was also set to visit Clark Green City in Pampanga, meet with executives of the Department of Transportation and deliver a keynote speech for the local Chambers of Commerce, then engage the Bases Conversion Development Authority on their future plans for the former American military base.
His other reason for arriving in the country was “to launch the return of British beef to the Philippines after 20 years of absence”.
After returning from Mariveles that day, Graham said he will preside over lunch to introduce premium cut meat to the media.
Later during dinner at his Forbes Park residence, Graham was scheduled to serve the same high-quality beef to some senators, according to Moon, who was also in the voyage.
We followed up with Graham: “What was the business travel to Mariveles all about?”
“[It is] very exciting,” he answered. “I’ve never been there before even when I was living here [in the Philippines] in the 1980s. I used to run Cathay Pacific 30 years ago as general manager.”
The envoy was so excited with the trip as he would be able to view Corregidor for the first time. As such, he directed the boat’s captain to detour so he could have a closer view of the historic island.
A member of parliament from Gloucester, Graham was appointed as the prime minister’s trade envoy to Malaysia and the Philippines in 2015.
He said the other objective of his visit, aside from overseeing the joint venture (JV) in Bataan, is to see their partnership with London-based Nectar Group Ltd. and with Filipino-owned Seasia Logistic Philippines Inc. (SLPI), an innovative port management and logistics group, with expertise in bulk, break bulk and container handling.
The collaboration expects to complete the first phase of a P3-billion development port project in Bataan.
“Nectar is a very experienced operator in ports and they find Atayde a very experienced guy in running ports in the Philippines. That is a good JV on an operational level,” he stated.
Seasia President Rafael Cosme, who was also in the trip, said Phase 1 of the port development project of SNPSI is worth P1.2 billion, covering 5.9 hectares, would be completed within the year. The port facility could accommodate two Supramax vessels, which are about 120 meters long and would be equipped with a 247-meter quay that could handle a capacity of at least 3 million tons annually.
SNPSI is 60-percent owned by Seasia Logistics and 40-percent by the Nectar Group. The planned dry bulk terminal is designed to handle shipment of coal, clinker, silica sand and other cement raw materials, steel, fertilizer and other dry-bulk cargo.
On the other hand, Atayde said the dry-bulk terminal in Mariveles would help resolve congestion at the ports of Manila. He said ports operating in the Philippine capital include the Manila International Container Terminal of International Container Terminal Services Inc., the South Harbor of Asian Terminals Inc., the Manila North Harbour Container Port Inc. and a privately owned Harbour Center.
The businessman pointed out that Bataan is nearer by sea to Manila compared to the Subic Bay Freeport economic zone.
Flexible offering
GRAHAM further revealed the other object of his visit, which is to offer the UKEF.
“They have taken advantage of UKEF and we double the amount of cover for the Philippines to £4.5 billion. Did you know it can be done in pesos, in pounds sterling and it can be done 100 percent?”
“It is very flexible and as the port in Mariveles expands, I think there will be opportunities to draw down on more UK-provided finance,” he added.
Asked to explain the difference between a regular lending institution and the UKEF, he said the key thing about the latter is that it is actually an export-credit agency guaranteeing the financing of a business from, for example, the Philippines to the UK.
And if something goes wrong, it then acts as an “insurance policy”.
“But it can also lend money directly. The main difference from a commercial loan is that if you are getting a loan form a government agency, then that gives it more credibility. It is a sign of confidence in the business so they can engage a bank and maybe renegotiate for a lower rate. So it should provide for a more efficient financing,” Graham explained.
He pointed out as a good example a local airline, which utilizes UKEF in financing the Airbus aircraft they buy, including the Rolls Royce engines for its airplanes.
“It is available to all Philippine companies, as long as there is a UK [component] to what they are buying.”
We followed-up, “Is there a limit to how much one can borrow?”
“Not really, but if you got £4.5 billion, that’s quite a lot of money,” Graham proclaimed, with a hint of dry Brit humor anew, adding: “But [we] wouldn’t lend it all to one project; [we] try to diversify the risks.”
Graham said that, before leaving the country, he would be calling on President Dutere in Malacañan Palace. He is also scheduled to meet Defense Secretary Delfin N. Lorenzana and Department of Trade and industry (DTI) officials.
The UK trade envoy said he is hoping to sign a couple of memoranda of understanding and his contingent is hoping to broker some technology sales to the government.
Meat of the ‘beef’
MEANWHILE, we segued into what the Philippines’s ‘beef’ was against British beef in the last 20 years.
The curiosity was fulfilled through Kevin Burrows, director of C&K Meats, a producer and abattoir in the UK. He flew into the country just for the occasion, although he confessed he had been in the country many times, providing his expertise in meat to- some of the biggest hotels in Manila.
“We got lost; it was all commercial,” he said during lunch at a posh hotel-and-casino establishment in Aseana Business Park, presiding over several raw cuts of meats headed for the oven.
He might have been referring to their cattle, which suffered from bovine spongiform encephalopathy, informally known as “mad cow disease”. It ravaged Britain’s cattle industry and the outbreak affected about 180,000 cows and devastated farming communities from 1986 to January 1993.
“We changed our thinking; it is not about commercialism anymore, it is about customers,” said Burrows.
Moon provided the technical reason for the long arrival of their beef to Manila’s tables:
“I think it took a while for the authorities here as they had to go back to the UK and look at the procedures and some of the farms. This was after the mad cow issues 20 years ago.”
He said the inspection took some time “because of the processes, but it is good now we got through the process. It’s all clear.”
He added the Philippine authorities were very helpful. “I should say, even for this beef to get through 70 kilos, just for this event. And for the event tonight, the ambassador is hosting at his residence; he will also be serving to some [Philippine] senators later on this evening.”
He said he does not have a precise figure, but estimates that the Philippine market for UK beef would be worth about £30 million a year.
“This year it could be half of that amount, but of course it depends on how well it goes down in the Philippines; how well it’s viewed. Hopefully, [one] can tell it’s a quality product.”
Moon added their beef has been successful around the world, and globally it has contributed about £350 million to the British economy.
“It’s popular,” he insisted.
He added that, “from today, it will take a while for various associations to establish their network, like any new business, because effectively, this is a new business. For 20 years.”
“We will come in and we will have to market it, establish demand, supply chain in various hotels, supermarkets, etc. It will take time, but we think £30 million to £34 million a year. We reckon it will be around that much.”
Moon said they are optimistic that the country will “bite” into their reintroduced quality meats, basing its projections from the DTI, as well as the country’s demographics and growth rates, given its population at 103 million, “which is clearly a lot more than 20 years ago”.
Image credits: Jimbo Albano, Recto Mercene