Please activate JavaScript!
Please install Adobe Flash Player, click here for download


D+C  e-Paper  December 2015 29 A worker with beer crates in Manila. Alan Robles is a free-lance journalist based in Manila. [email protected] SMC’s answer: expand into other businesses. In 2008, it diversified into mining, banking, fuel and oil, power generation, infrastructure and even – for a while – the airline business. Now it’s about to go into telecommunications in partnership with Telstra. According to Jonathan Ravelas, a leading analyst with the Philippines’ largest bank BDO Unibank, about half of every peso a Filipino spends currently flows directly or indirectly into the coffers of San Miguel. Ramon Ang, the company’s president and chief operating officer, said that within a few years, “the food business will hopefully comprise only 20 % of our total sales”. If his plans bear fruit, San Miguel’s earnings will come from energy, petroleum and infra- structure – a far cry from beer, soft drinks and ice cream. Authoritarian heritage Ang’s very presence in San Miguel is a reminder of a dark chapter in the company’s history. In 1972, when president Ferdinand Marcos declared martial law and set himself up as a dictator, he promised to reform Philippine society and dismantle the oligar- chy that ruled and exploited the country. Instead, he set up a new set of masters consisting of himself, his relatives and cronies. In what came to be called “crony capitalism”, they proceeded to plunder the country’s treasury and divide up the economy, using Marcos’ dictatorial powers to grab control of strategic indus- tries and individual businesses. Inevitably, the giant San Miguel Corporation attracted attention. In 1983, Marcos’ crony Eduardo Cojuangco Jr. used billions of pesos raised through a forced tax on coconut farmers to effectively buy con- trol of SMC, making himself chairman of the board. However, his tenure was cut short in 1986 when he had to abruptly flee the country with Marcos after a peaceful “people power” uprising. In the process of dismantling the dictatorship’s crony economy, the government of President Corazon Aquino seized Cojuangco’s shares worth more than $ 1.2 billion and amounting to 47.9 % of the company. Through a series of devious manoeuvres, facilitated by political accommodations with the administra- tions of Presidents Joseph Estrada and Gloria Arroyo, Cojuangco not only wormed his way back into SMC, but also resumed chairmanship of the company. Ang is his right hand man. It is perhaps this shady past that prompted the Economist in 1990 to call SMC “a showcase for much that is wrong with business in the Philippines”. Link San Miguel Corporation: