Shot in the foot-A A +A
Monday, September 17, 2012
THE decision of Ayala Land Inc. (ALI) to pull out its planned P6 billion development plan for that property behind the Provincial Capitol is a big blow both to Bacolod and to the Province. Pumping in P6 billion into our island is already a windfall; but would you believe it is peanuts to what should have happened next?
The multiplier effect the P6 billion investment would have additionally generated as the money transfers in the course of business from ALI to the contractors, to the employees of the contractors and sub-contractors, to the suppliers of materials and products, to the personnel to be hired by mall lessees and to the enumerable other opportunities for income all that economic activity would have produced is incalculable. Why, we will be talking in the mega billions already! Unfortunately, all that anticipated windfall evaporated with Ayala's decision to back out.
I can understand why SM would try to stop ALI. Right or wrong, it is a keen competitor of the Ayalas and it's part of competition to try and corner one's "territory." The sad part of it, however, is that it seems the straw that broke ALI's back was the Commission on Audit's one-year delay in ruling on the deed of conditional sale and contract of lease signed by Ayala with the Provincial Government. A review of those contracts should have taken the COA only days, or at most several weeks, to make. Contracts like that are not complicated and the laws governing them are clear and concise. A year to review their validity and implication is unjustified and unforgivable.
It's ironic that it was the provincial government that enticed Ayala Land to come in. The purchase and sale as well as the contract of lease over an additional portion of land would have been a good example of the public-private partnership that the Aquino Administration has been trying to push in the country. That it should also be government through the COA that prevented its becoming a reality is the irony of ironies, indeed.
Competition among the big mall owners should have been good for Bacolod. The mere fact that SM, Robinsons, Gaisano and then, Ayala thought it good business to enter Bacolod City is already enough to prove that there's enough commerce to go around without anyone of them being prevented entry. Add to that the additional employment and investment opportunities that their presence opens to Bacolodnons and Negrosanons, and one gets an idea how much we just lost.
During the weekend, text messages mourning the ALI pullout have been flying thick and fast. Detractors will of course say that these are just political propaganda hatched by groups having a stake with Ayala Land's entry into the Province. Even if they are right, assuming such interest groups exist, the fact still is that we just lost ourselves another golden investment. We just lost another chance to prove that Bacolod is business and investment friendly.
We have just been shot in the foot. And it's going to hurt-big time!
Published in the Sun.Star Bacolod newspaper on September 17, 2012.