PEP EXCLUSIVE: Coconut farmers want Lani Mercado's resignation as San Miguel Corp. Board Member


"Based on our initial study, ill-advised talaga to put someone there, kahit hindi si Ms. Mercado, e, kahit anyone, who is not even aware lang of why they were placed there in the first place—by virtue of the coco levy funds," explains Miguel Musngi, Centro Saka Public Advocacy Officer, on why coconut farmers want the resignation of actress Lani Mercado (in photo) as San Miguel Corp. Board Member.

Coconut farmers are asking for the resignation of actress Lani Mercado from her position as one of the 15 board members in San Miguel Corporation (SMC), saying she is "not fit" for her position.

Centro Saka, Inc., a non-government organization that supports people's initiatives for agrarian reform and rural development, said coconut farmers around the country were "surprised and disappointed" when the appointment was made public. The farmers are already discussing a unified statement asking for the actress' resignation, the NGO said.

In an interview with PEP (Philippine Entertainment Portal), last Thursday, August 20, Centro Saka Public Advocacy Officer Miguel Musngi stated that Lani's appointment to the position is a "mockery" of the 20-year fight of coconut farmers in the country to reclaim their rights in the multinational corporation.

According to the website of the Philippine Coconut Authority (PCA)—a government agency under the Department of Agriculture tasked "to oversee the development of the coconut and other palm oil industry"—coconut farming remains a "dominant" sector of the Philippine economy. It is among the Top 5 net foreign exchange earners, averaging US$760M per year.


About 25 million Filipinos, or 27 percent of the total population, are either directly or indirectly dependent on the coconut industry, said the PCA. Majority of the farmers live in the poorest provinces in the country.

GMANews.TV notes that SMC Chairman Danding Cojuangco bought the United Coconut Planters Bank (UCPB) during the Marcos regime through the use of coco levy funds, which consisted of taxes imposed by former President Ferdinand Marcos on coconut farmers in the country.

UCPB, which Cojuangco also controls, is among the companies declared during the administration of former President Cory Aquino to have been acquired by Marcos cronies using public funds. Cojuangco is closely linked to former President Ferdinand Marcos.

In 1983, Cojuangco acquired 27 percent of SMC shares through the UCPB. The business tycoon also controls 20 percent of the multinational corporation's total stock.

But a May 7, 2004 Sandiganbayan decision awarded Cojuangco's 27 percent SMC shares to the government, following a Supreme Court declaration that the funds used to acquire them were prima facie (at first view) public in character, thereby beholden to public interest.


The decision opened space for a government seat in SMC's Board of Directors, to be appointed by the President through the Presidential Commission on Good Government (PCGG).

Musngi said this chain of events proves that the appointed government representative must protect the rights of the coconut farmers in SMC. He added that his organization does not think Lani Mercado represents the farmers in any way.

"Based on our initial study, ill-advised talaga to put someone there, kahit hindi si Ms. Mercado, e, kahit anyone, who is not even aware lang of why they were placed there in the first place—by virtue of the coco levy funds," he explained.

Musngi added that their organization is not criticizing the actress for her qualifications, but for her own perceived role in the company.

Earlier, Lani told PEP (Philippine Entertainment Portal) in an interview that she thinks Pres. Gloria Macapagal-Arroyo appointed her because SMC needs someone who carries the voice of the consumers. (Click here to read related story.)


PLOT AGAINST FARMERS. According to Musngi, Centro Saka perceives Lani Mercado's appointment as part of the plot of Danding Cojuangco to take over the coconut farmers rights in SMC.

"I think the issue is beyond Lani Mercado," Musngi added. "Narrow yung perspective kung gagawin 'tong laban between Lani Mercado and the coconut farmers. We're calling for her resignation para mapalutang what's the issue behind the issue—yung control ni Danding Cojuangco sa SMC, and the people he uses to preserve that control."

To appoint a government representative to SMC, the President must first submit a request letter to the PCGG to ask for nominees. Upon receiving the request letter, the PCGG must hold a meeting with concerned sectors to decide whom to pick. The chosen candidate will then be confirmed and appointed by the President.

Musngi said this procedure was followed during the time of the late former PCGG former Chair Haydee Yorac. But this process changed under the administration of current PCGG Chairman Camilo Sabio.


Musngi said there was no consultation before Lani Mercado was appointed by the President.

"So, halimbawa, ang Malacañang binigyan si PCGG ng letter. Dati ini-scrutinize ko, ngayon hindi na. Po-forward ko 'yan sa, in this case, SMC. At sabihin ko, 'O, board of directors, mag-meeting kayo. Sinabi ng Malacañang uupo diyan si ganito,'" Musngi explained.

This is most unfortunate, Musngi said, because the hold of coconut farmers on their SMC shares is gradually slipping.

For the 27 percent shares that the Supreme Court delegated to the coconut farmers, SMC pays them a certain amount depending on the dividend of the company for the year.

The earnings are then transferred to UCPB and the Coconut Industry Investment Fund (CIIF) Oil Mills, a conglomeration of companies engaged in coconut oil milling and refining. Coconut farmers benefit from the dividend through loans from UCPB, and through development programs from CIIF.

SMC, however, proposed to the government last June that it can now convert its common shares to preferred shares. A government lawyer representing PCGG told last Monday, August 24, that the government embraces the idea, because it will yield higher earnings every time the company announces a dividend.


Musngi said, however, that the increase in earnings will be given in exchange for the government's voting rights in the multinational company. Accepting the preferred stocks option, therefore, is akin to surrendering the voice of the coconut farmers.

He also warned that the government seat in SMC may be lost in three years because SMC has the option to buy preferred stocks from shareholders.

"Kung ilalagay natin si Lani Mercado sa posisyon na 'yon, wala na yung source ng sinasabing ang nire-represent ni Lani Mercado ay ang government shares. Wala na 'yon, kasi after two or three years, bibilhin na 'yon ng San Miguel Corporation. In effect, yung interest ngayon ng coconut farmers, mabubura na," Musngi explained.

This is the reason Centro Saka, Inc. is asking for the resignation of Lani Mercado from her newly-acquired post.

"Kung maiintindihan 'to ni Ms. Mercado, I think she would also arrive with the same conclusion that she should yield her position to someone who would be more able to protect the coconut farmers," Musngi concluded.


NO REPLY YET FROM LANI. PEP tried to contact Lani Mercado for her reaction to the statements of Centro Saka, Inc., but requests for a phone interview are still unanswered as of press time.

PEP sent the request through two text messages sent to the actress last Saturday, August 22, at 1:55 p.m., and last Sunday, August 23, at 3:43 p.m.

To check if Lani's number is still working, PEP also called her cellular phone number last Monday at 3:09 p.m., and a ringtune sounded on the other line.





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