Who ‘facilitated’ NFA overpriced rice deal?

Nail the “facilitator” in the National Food Authority’s overpriced rice import from Vietnam last year. That person – a certain “Buddy R.” – would know who the recipients are of the alleged P457-million kickback.

Concerned finance department officials are suggesting the strategy for the Ombudsman to unravel details of the anomaly. Private lawyer Argee Guevara, in a plunder suit against the two highest NFA men, gives numerous leads for investigators to track down Buddy R.

The import, P4.1 billion for 205,700 tons of rice, was a government-to-government transaction between the Philippines and Vietnam. Thus, the finance officials say, there was no need for Buddy R. as consultant. The negotiators from both sides are supposed to be experts in grains agriculture, trading, and shipping. Yet in this deal a private businessman was hired as broker for the NFA with its counterpart Vietnam Southern Food Corp. (Vinafood-2).

Buddy R.’s presence alone should ring alarm bells, the officials add while requesting anonymity. “Facilitators” in G2G deals serve as conduits for kickbacks, disguised as sales commissions, they explain. Guevara calls Buddy R. the “palusot-ator” who traveled with NFA men to Vietnam and Singapore.

Guevara has accused NFA chairman (Agriculture Secretary) Proceso Alcala and administrator Orlan Calayag as masterminds. In the complaint, deputy administrators Dennis Guerrero and Ludovico Jarina are implicated in “cloak-and-dagger” trysts:

• On Apr. 1, 2013, Calayag, Guerrero, and Buddy R. went to the Makati Shangri-la Hotel, where officials of Vinafood happened to be billeted.

• Weeks later Guerrero and Buddy R. flew to Vietnam, without official clearances to travel on government time and expense. There they secretly met with Vinafood general director Truong Thanh Phong.

• Guerrero and Buddy R. proceeded to Singapore, where they billeted themselves at the Hyatt Hotel. Phong and other Vinafood officials also flew to the island-state and checked in at the same hotel.

• On May 8, 2013, Guerrero and Buddy R. again flew to Vietnam, there to be joined three days later by Jarina.

 The Filipinos made their Vietnamese counterparts recognize the NFA as the sole authorized importer of rice in the Philippines. This was for them an important document, to skirt the rules of the World Trade Organization, to which both countries are signatories. The international body forbade governments, starting 2004, from monopolizing food trading. The Philippines twice was granted extensions of the NFA monopoly, which expired in June 2012.

Guevara says the NFA’s G2G with Vietnam was a convenient cover for corruption. It would seem there was no hanky-panky between state officials, he says, but Buddy R.’s role shows otherwise.

The NFA paid $459.75 per ton of the Vietnam rice at a time when the going rate was only $360-$365 per ton freight-on-board. The accused officials claim to have incurred added costs for trucking and shipping. Guevara retorts that such items already are included in website price quotes. Besides, in real G2Gs between neighboring states, the bureaucrats transact on lower import rates and softer terms. In this case the higher rate was used, to insert the P457-million kickback, Guevara says.

The finance officials lament that the government should have earned P2 billion in taxes from the P4.1-billion deal. This, had the NFA let private traders do the importing, for which they would have had to pay 50-percent duty.

Guevara says the NFA brass also kept the true figures from Malacañang. This was why President Noynoy Aquino said in his State of the Nation last July that the government imported only 187,000 tons of rice. Yet there was an additional 18,700 tons – unauthorized.

In a related development, the Federation of Philippine Industries has given the NBI evidence that alleged rice smuggler David Tan and businessman Davidson T. Bangayan are one and the same.

Documents from a court case, in which a Singaporean firm sued Bangayan for fraudulent shipments to India, show that “David Tan” was his alias. FPI chairman Jesus Arranza gave the papers to the NBI, which last week hesitated to arrest Bangayan because of uncertain identity.

Tan is said to have bribed Customs officials P6 billion in the past two years to accept the smuggled rice. Bangayan popped up at the office of Justice Sec. Leila de Lima to deny being Tan.

In a subsequent television interview Bangayan disavowed any link to rice importing. Yet in the same event his lawyer strived to justify his recent shipment of rice that the Customs bureau has seized. Oddly Bangayan’s name does not appear in the records of the importing firm.

Customs insiders claim that accusations against Tan are diversionary. Supposedly a cartel in Southern Tagalog-Bicol regions is using him as decoy while muscling into Central Luzon-Cagayan.

Rice traders, meanwhile, say there can be no smuggling because the commodity is too visible to slip into the piers. Importers purportedly are willing to pay the 50-percent tariff, but the Customs confiscates their cargo on the NFA’s insistence on its monopoly.

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