What could our taipans do?

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Whatever happens in the Middle East now, it is certain that our country’s economy would be severely affected as growth falls, hunger rate increases and shortages of all sorts happen. That’s because supply of oil products will remain largely constricted, causing prices to stay high.

As the CNN puts it, “the global oil crisis has turned into an everything crisis. It is threatening to morph into a shortage of nearly everything. The disruption has also squeezed supplies of petrochemicals needed to make everyday items like shoes, clothing, plastic bags, crates and containers.”

In South Korea, CNN reports, people have been panic-buying trash bags. The South Korean government has encouraged event organizers to minimize use of disposable items.

“In Japan, the oil crisis has sparked fears that patients with chronic kidney failure won’t be able to get treatment due to a lack of plastic medical tubes used in hemodialysis.

“Malaysian glove manufacturers say a dearth of a petroleum byproduct needed to make rubber latex is threatening global supplies of medical gloves.”

The International Monetary Fund wrote in a blog post: “Such complex spillovers confront us at a time when many economies have limited room to absorb shocks. Although the war could shape the global economy in different ways, all roads lead to higher prices and slower growth.”

Already, household purchasing power is being eroded by higher domestic energy prices, not good for our consumer-driven economy.

BusinessWorld reports that the latest data from the Bureau of the Treasury showed that government spending fell year-on-year for a sixth straight month in January, slumping by 23.9 percent. That’s bad because our GDP growth is driven by government spending.

The government may be nominally running this country but the ship of state is obviously in trouble. Those who can do something to prevent sinking should now do more.

These are the taipans, those who belong to the top one percent of families controlling roughly P17.9 trillion in 2022. That’s approximately triple the combined net worth of the poorest half of the population.

With total private wealth estimated at P55 trillion, the top one percent owns nearly one-third (32.5 percent) of the country’s total net worth. The top 10 percent of Filipinos hold approximately P40 trillion, which is 1.33 times larger than the projected 2026 GDP.

The point is, the elite has plenty to spare to help the country in its time of need. Indeed, the severe wealth inequality has often given rise to calls for a wealth tax. But a wealth tax, no matter how justified, will never happen. BBM won’t even pay a long pending inheritance tax.

All we can do now in our current state of emergency is to appeal to our taipans to do more than their token CSR projects.

What can our taipans do?

Two taipans, Ayala Corp. chair Jaime Augusto Zobel de Ayala or JAZA and SM Group’s Teresita Sy-Coson during a panel discussion, InvestPH, started talking about how vulnerable the country is because we only have one oil refinery. We are largely dependent on the weekly spot market for petroleum products. Tessie nudged JAZA to invest in an oil refinery.

“Jaime, can you call Shell? Please do it for the country. We have to be a bit more independent,” Tessie exclaimed.

JAZA, whose brother Fernando sits as an independent director on the board of Shell Pilipinas, told her, “I would gladly invest in it together with you, Tessie.”

The Zobel de Ayala family has historically been stockholders and served as board members in Shell Pilipinas. The Zobels were invested in Shell when it closed their oil refinery in Batangas in 2020, claiming it was no longer economically viable to run the facility.

So, there you go…

Our food supply will be the next crisis arising from the high fuel costs.

Last week, an NGO helping farmers market their excess produce of vegetables gave up because they cannot afford the high diesel cost of sending a truck to pick up the produce. That means so much vegetables are going to waste and many farmers are going hungry.

With our high reliance on food imports, we are facing high food security risk, even without the Hormuz crisis. Now, the Department of Agriculture warns of a potential 50 percent increase in the price of rice, pork and chicken if the Gulf crisis persists.

The SM Group has a Kabalikat sa Kabuhayan (KSK) program helping farmers and providing direct market linkages to SM Markets, which helps bypass some middleman costs. Maybe Tessie and her siblings should expand the operations of this program. Take over the work of the NGOs helping farmers.

Ayala Corp. has supposedly been working to strengthen fresh food supply chains and logistics. AyalaLand Logistics has supposedly expanded its cold storage capacity by 56 percent in 2025. This is intended to reduce food spoilage and stabilize supply.

When Air 21 was owned by Bert Lina, it used its refrigerated vans to take vegetables from farmers as backhaul on return trips to Manila. I am not sure if Ayala has continued the practice.

Our farmers in Nueva Viscaya and Benguet are desperate after the regular traders have stopped buying because the price of diesel for their trucks is now too high.

Then there are things that should be plainly and urgently done because of the dire need, like feeding centers. San Miguel recognized this back in 2019 when it started Better World Tondo whose goal was simply to feed the hungry. It began as a soup kitchen and kept growing.

Better World Diliman buys produce bought from farmers which are either sold on-site to consumers and resellers, bought by donors, or are donated to SMC’s Better World Tondo food bank. SMC also provides transportation, heavy-duty freezers and machines to maintain the freshness of farmers’ produce. I guess SMC must now do more.

No more token CSRs. Taipans should invest more on fighting hunger which threatens their personal security too.

Boo Chanco’s email address is [email protected]. Follow him on X @boochanco