MEMBERS of the Davao Oriental Chamber of Commerce and Industry (DOCCI) welcomed the arrival of Europe's biggest bio-fuel company in their province with the hope that the firm's $200 million investment will truly rev up the economy of Davao Oriental, which used to rely solely on the coconut industry.
"We warmly welcome the arrival of the Spanish bio-fuel company in Davao Oriental. This investment will truly make a difference here, it will truly improve the quality of life especially of our highly impoverished people which used to rely on the coconut industry," said DOCCI president Louie Rabat.
Governor Corazon N. Malanyaon, along with President Gloria Macapagal Arroyo, witnessed the signing of the joint venture investment during Arroyo's state visit in Madrid, Spain last December 2007.
Philippine-based company Guidance Management Corporation (GMC) signed an agreement with the Spain-based Green Fuel Corporation (GFC) for a joint venture that will undertake several bio-fuel projects in Davao Oriental.
The agreement was signed during a business meeting on December 4, 2007 in Spain's capital, Madrid. Arroyo, Malanyaon, Department of Trade and Industry (DTI) Secretary Peter Favila, Senator Miguel Zubiri, who authored the Philippine Biofuels Act, and top officials of the Spanish Confederation of Business Organizations, witnessed the signing.
The project's investment in its initial phase is estimated at $150 million, which will be allocated to planting of at least 60,000 hectares of palm in Davao Oriental, creating jobs for some 10,000 families in the province.
"There's no apprehension whatsoever on the part of the local businessmen with regards to the entry of the Spanish bio-fuel company here. No one among the local businessmen will be displaced because of that investment. That's why we fully support its entry here," Rabat said.
"In fact, we are surprised no end because that kind of investment is the least we expected for Davao Oriental. And they are here already, fascinated with the business climate and potentials of Davao Oriental. We can only credit its entry here to the relentless efforts of our hardworking Governor Corazon Malanyaon to attract foreign investors in our province," said Rabat, who is the son of former Davao Oriental Governor Francisco Rabat.
Rabat's younger sister, Michelle, is the incumbent mayor of the City of Mati.
"With the entry of this biggest bio-fuel investment in our province, the future of Davao Oriental is indeed very bright. We will no longer have to rely on the coconut industry, Davao Oriental being the largest producer of coconut in the country. In fact, this is helping to revive the coconut industry because coconut is one of the alternative sources or feedstock for bio-fuel production. Now, prices of copra here is now stabilized at a higher price, which means the coconut industry is now booming," Rabat said.
Green Fuel Corporation is a bio-diesel company whose shareholders include Spanish utility Endesa and Tecnicas Reunidas, one of the world's largest general contractors. The unprecedented and historic link-up between a European and Philippine companies is by far the most comprehensive joint venture agreement signed to date for the Philippine bio-diesel industry as the joint venture will develop the entire value chain, encompassing the procurement of feedstock, oil crushing, extraction and refining as well as the production of bio-diesel.
The Chairman of GMC, Jack Rodríguez, defined the relations with GFC, as "strategic for the joint development of vertically integrated bio-diesel projects in the Philippines".
President Arroyo has pledged her full support for the joint venture, while Senator Zubiri and Governor Malanyaon have underlined their commitment to facilitating the development of this milestone bio-diesel project.
For his part, the President of GFC, José Luis del Val, have stated that "The presence in the Philippines, apart from expanding the raw material base required for our projects, opens up the path to a region, Asia, with enormous economic growth potential and where more than half of the world's population live, from a country (the Philippines) historically rooted with Spain."
As part of the agreement, both companies have constituted a joint venture that is open to the incorporation of other local partners from the fuel distribution sector, as well as companies that can add value to the bio-diesel production chain with the objective of securing raw materials (coconut, palm and jatropha oils) via mass cultivation of oleaginous plants, the construction of an oil crushing, extraction and refining unit with an annual vegetable oil processing capacity of 200,000 tons and a bio-diesel plant with a production capacity of 110,000 tons per year. This will be followed by the gradual expansion of the company to other countries in Southeast Asia.
The initial steps of the project are directed towards the extraction of coconut oil of which there are plenty in Davao Oriental and the planting of a high-yielding variety of oil palm for feedstock and to be followed by the sowing of jatropha once its economic viability and availability in sufficiently large quantities can be guaranteed.
Davao Oriental Governor Corazon Malanyaon said she was "grateful no end" to President Arroyo for her "all-out support" to their efforts to sell the province's investment and tourism sites to the world market. She also said that another "big amount of investment" is set for the province to benefit by the investors from China who have planned to put up a fish processing plant in Davao Oriental. (With FZ)
