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BATAAN EXPORT PROCESSING ZONE
History
Theoretically,
the Bataan Export Processing Zone (BEPZ) is the result of the Philippine
government's decision to concentrate its development efforts in the field of
foreign-owned, export-oriented industrialization.
This
occurred in the mid-1960 as policies of "import substitution" (on the
rise in the 1950's) were proven ineffective. This type of development claims
that the benefits of foreign capital in the field of technology transfer,
employment and industrial infrastructure will enable the nation to become
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"competitive" in the global capitalist market.
The
zone itself began as an idea of Congressman Pablo Roman, Sr., a
representative from Bataan, who authored Republic Act
5490 which was passed by the Legislative Body (of the defunct House of
Congress) on 21 June 1969 designating Mariveles, Bataan as the first free trade zone in the Philippines.
Roman was also the owner of extensive landholdings in the vicinity of the BEPZ.
In
early 1972, three congressmen — Roman, Roces
and Sarmiento - sponsored the bill to convert the free trade zone authority
into government corporation. This would grant the power of a corporation
combined with the coercive strength of the Philippine Government to move the
project ahead, especially regarding the relocation of residents. The bill
stalled in Congress due to the opposition of many members to the vested
interests involved. However, barely two months after the declaration of Martial
Law on 21 September 1972, Presidential Decree 66 was promulgated creating the
Export Processing Zone Authority (EPZA) and extending the credits and benefits
to foreign enterprises while ordering the relocation of the residents living
within the zone. The construction of the zone and its infrastructure could now
proceed.
There
is no room here for a discussion of the many factors involved in the process
but it must be mentioned that many fortunes were made and enhanced during the
creation of the zone. The proliferation of high income subdivision, highway
projects and luxury hotels attest to this fact. Martial Law also stifled,
through fear. The protest of the poor residents of the barrios which were
dislocated by the zone.
The
land for the zone, although settled by Barrio Nassco,
was readily made available. This was formerly occupied by the military
reservation of the USA and was given up in 1965 after 40 years of occupancy.
The land which was promised to the residents was never delivered.
Selling
Points
The
following are official benefits to
corporations in the zone:
1.
No municipal tax
2.
No duty on import of
resources for construction or manufacturer.
3.
No duty on exports
4.
Carry over of net
operating losses incurred in the first five years as deduction on income tax
for the next five years
5. accelerated depreciation of fixed assets.
In
addition, the following points were cited by Zone authorities in the process of
attracting business:
1.
The Philippines is the
'hub' of Southeast Asia — a central location
2.
English is spoken
3.
Highly trained and
low-paid work force
4.
Politically stable due
to Martial Law
5. No strikes due to designation of the zone as "vital
industry".
Structure of
BEPZ
The
zone is located on 1,600 hectares of land adjacent to Mariveles,
Bataan. The land is divided into areas for heavy
medium and light industry. The zone rents all land and provides the necessary
infrastructures of electricity and water — the zone has its own water
treatment facilities. The factories have the option to rent standard factory
buildings (SFB) for light industries or construct their own buildings like the
Ford Stamping Plant.
Other
facilities in the zone:
1.
New administration
ration building
2.
Clinic
3.
Worker housing
4.
Schools
5.
Manpower training center to provide vocational training for zone business
6.
Sports facilities
7. Ecumenical chapel
We
also visited the Bataan Hilltop Hotel, a luxury
facility built for executives primarily — the rooms rent for US$ 30.00
per night. Nearby is the Landau Hotel owned by a
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corporation headed by Pablo Roman,
Jr. and others who have been instrumental in the construction of the zone.
The
administration of the zone is in the hands of a Board of Directors headed by Teodoro Q. Pena of the Central Bank and includes government
and private sector representatives. The zone manager is Dioscoro Manrique, a local politician whom we met. He sees his role
as "making life in the zone quite enjoyable and meaningful". In
addition, the EPZA has its autonomous police force and intelligence force,
medical personnel and its own transportation system.
In
short, the zone is a complete enclave whose only relationship to the province
of Bataan is its use of the labor force. The city of Mariveles has no control over the zone; in fact, no group
of Philippine citizens can have any say over the business activities within.
The Factories —
physical conditions, the external appearance of the factories the group
visited were quite similar. Most factories are set in well attended grounds and
there is provision for workers to sit outside. The internal appearance of most
factories was also similar. They are quite spacious. There was a distinct
difference between the conditions in the offices, between the
administrative and management areas and the factories themselves. In the
offices, the furniture was very comfortable and the offices are all
air-conditioned. By contrast, the factories are not air-conditioned, except at Sohron where the machinery necessitated it. At Mattel,
Taiyo Giken, Interasia and Amco, the temperatures were very high.
Lighting
in most factories was adequate. It was
poor in parts of Ford and Taiyo Giken. The noise
level depended on the type of industry.
It was high at Ford Stamping Plant and Taiyo Giken.
At Ford several safety measures were taken to protect workers, e.g. safety
glass and safety controls on presses. At Taiyo Giken
girls use drills without their faces, hands and eyes protected. There were
metal scraps flying around the air.
Ownership — Much
of the capital invested the Zone
is foreign — from countries like Japan, Hong Kong, USA and Australia Foreign
investors cannot be expected in have the same concern and regard for the
national interest as the indigenous investor would (Ohara
Ken, Bataan Export Processing Zone,
p. 99). The foreign investor is not concerned with the welfare of the worker He
is concerned to get the highest possible profit on the capital invested.
Management —
Approximately half of the managers interviewed were foreigners, e.g. Nam Yang
Chinese from Hong Kong, Pasig-Japanese, Amco and Ford, Australian. Their understanding of the
concern for problems faced by the workers was poor. This was also true of
Filipino managers who appeared very Westernized. They questioned the need for
workers to return home at times of illness and death. They were also very
critical if a worker was absent or late. The only manager that the group
interviewed that seemed aware of the problems faced by the workers was at Pasig Textiles.
Products —
Items being made in BEPZ include clothing, shoes, watches, plastic
flowers, dolls, car parts and woven plastic bags. It seems that even the
management had little control over what was being manufactured. They seem to be
dictated by Head Offices overseas and the orders of their customers.
Some
items being made in BEPZ receive labels such as "Made in Hong Kong" or
"Made in Korea" and therefore buyers overseas would have no
knowledge that they were made in the Philippines. Workers questioned whether
some items not marked "Made in the Philippines" get to the market in
the Philippines without duty being period.
Many
of the products made involved highly monotonous work e.g. spray painting eye
color and eyebrows of Barbie dolls. It was so distressing that long-legged,
blonde, big busted Barbie dolls were being produced. Is this really the epitome
of beauty?
Products
made at BEPZ sell in countries
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such as Hong
Kong, North and South Korea, Japan, Germany and other parts of Europe, North
America and Australia.
Wages –
The minimum salary of the workers is P8.00 per day including allowance and the
maximum is P24.00 per day (in Ford) or P3.00 to P3.70 per hour without
allowance for eight hours a day. If they work everyday, they will get
allowance.
Cost of Living – Many workers come from outside Bataan
and they live in boarding houses in Mariveles town.
The very small space they rent is used for their cooking, sleeping and
everything.
Here
are some figures, which explain the minimum expenditure of a worker per
month:
boarding P 25.00
transportation 15.00
food 100.00
emergency 22.00
_____
Total P 162.00
It
was observed that the above average is not enough for a single person to live
decently. Let alone the constant threat to the worker's health due to the bad
working conditions in the factories.
Labor Problems - As there are so many factories, so there are many
workers. According to one of the employers in the Manpower Building, there
are about 20,000 workers in BEPZ, comprising of 9,895 males and 11,105 females.
And there still are another 11,000 registered who are waiting for jobs. College
graduates have priority in landing a job, but they get the same salaries as the
other laborers.
The
workers before being accepted by the company have to join a training course first.
In their first three months, the workers are called trainees. They get paid
P6.75 a day for six month because they are considered unproductive as they are
still learning. Therefore, the company invests in them instead of their
contributing to the company’s income.
It was observed
that many of the jobs are very simple and would not actually require or need
any training. There is the story of Lita, a girl who
works in Inter Asia (manufactures plastic woven bags). She was first asked
to join the usual training for three months and after the period was finished,
for no reason at all she was asked to have another three months training. Later
she was transferred to another department and had to undergo another three
months of training before getting a higher pay.
According
to the workers, the management has
used a number of tricks such as:
1. stating that low profit margins prevent management from
paying higher wages and giving bonuses;
2. stating that the new workers require at least three months
training before they are fully productive (as in the case of Lita); and
3.
terminating employment
because of alleged alteration to machinery.
In
one company, the Lotus Export Company, they changed from leather to rubber
(athletic) shoes, so workers, ceased working in August with the understanding
that work would resume in about a week. In September, they were told,
production would begin again in October and when October came, the resumption
of work was postponed to November. Up to mid-December, no work has resumed.
Coincidentally, the workers were trying to organize a labor union at the time
work was stopped.
Not
all workers have unions; very few factories have. Those who are not
organized into a legal union (because they are not allowed) manage to organize
underground. But this is to a great risk for immediate action is taken by the
management against such activist workers. They either fire them or transfer
them to other factories or in cases where such workers are valuable to the
company, they are elevated to high position to isolate them from their fellow
workers.
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Effects of
the BEPZ on Mariveles
The
foremost problem in Mariveles, which was aggravated
by the presence of the BEPZ is housing. Since 1960, the devotion of the
government to develop an industrial area in Mariveles
has cost suffering among the people there. May be this is an inevitable part of
the process of development to foster economic growth or this could be a consequence
of government policies which did not look into the problem very well. But the
development of Bataan Export Processing Zone is a
typical example of dislocation and further suffering brought upon the poor.
Even the Secretary to the Mayor of Mariveles
admits that housing is one of the burning issues there due to poor government
planning.
Background – In addition to the town proper at Mariveles,
there was the NASSCO (National Shipyard and Steel Corporation) barrio. When
NASSCO complex was set up in 1950, families of the Nassco
workers began to inhabit a large piece of land which had been used by the US
Navy as a base. NASSCO told the workers to stay where they like. Therefore the
NASSCO community was formed.
When
President Marcos declared the establishment of BEPZ in Mariveles
in order to hasten the hope for an industrialized Philippines, NASSCO
inhabitants were requested to move out from the zone where they had been living
for over 20 years. But they were not given proper places nearby and they
received no compensation. Housing in Mariveles thus
became overcrowded.
The
problem of housing can be classified in three aspects: 1) overcrowding, 2)
relocation, and 3) squatters.
Overcrowding: Before
the construction of the BEPZ, the population in the town was 3,000. After the Zone
was established in 1975, there were over 25,000 inhabitants. In 1977, the
population was increased to 42,000 including 22,000 BEPZ workers. This rapid
increase of population exceeds the supply of accommodation in the small town.
There are several causes
contributing to the overcrowding
situation in Mariveles:
1.
Large scale of immigration:
the development of BEPZ attracts and absorbs labor forces from the
provinces and all over the country. Each house is inhabited by ten or more
boarders. Usually the so-called "room" is only a place for a bed
which is roughly 8 ft. X 10 ft. This bed space is rented out by the owner for
at least P50 to P80 per month. Usually two boarders sleep on one bed. There are
cases where a day-time worker uses the bed at night and a night-time worker
uses it during the day time. In other cases, one can witness a boarding house
whose normal capacity is less than ten is crowded in by 25 people. Owning a
house in the area has meant a treasure of wealth for some.
2.
Failure of family planning (natural increase): Children can be seen playing
around in the town. Each couple raises from 6 to 10 children. Meanwhile a large
number of young people are just approaching the age of marriage. They will also
potentially raise a large number of children. Based on the birth rate, the
increase of population shall be unabated.
3.
Low wages: Except the
workers of Ford Stamping Plant who get hourly pay, all the zone workers are
paid daily. Their minimum and maximum daily wages are ranging from P6.75 to
P14.00 with which they cannot afford to rent a house or even a room for
themselves. The only way to get a shelter is to hire a bed or share a. room or
a bed with their friends and co-workers.
4.
Transportation:
The low wages of the workers make it difficult to afford transport from
BEPZ to their homes. Therefore the economic way for them to save money is try
to live nearby their working place. Do the workers like to
live in such over-crowded conditions in Mariveles?
The answer is negative. But the majority of them are too poor to exercise
effective choice in the housing market. They have to take whatever they can
afford: a bed space, even a body space.
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Relocation: NASSCO barrio was previously located
in the center of BEPZ but this was all changed with the enactment of Republic
Act No. 594 in 1969, which declared in part: "No person would be allowed
to reside within the Zone". The inhabitants opposed the relocation.
Protests and demonstrations were organized. They resisted government actions in
clearing their resident premises. The period of resistance and struggle to keep
their home and land was crushed when Martial Law was proclaimed. The active
leaders of the community were arrested. Residents who had lived in the Zone
area for over twenty years were forced to move to temporary sites at their own
expense. No compensation was given by the government.
There
are several temporary sites for the relocation of NASSCO inhabitants:
1. ALION (sunrise village, Batangas
II)
2. Mountain view division
3. Baseco country
4.
BEPZ dorms for single
workers
NASSCO
residents did not want to be relocated in the assigned residential areas mainly
due to transportation and housing facilities. For instance, from BEPZ to ALION,
the people have to pay P1.00 for the "baby bus" and then pay another
30c to take the jeepney for Sunrise Village, Batangas II. The whole trip would take more than half an
hour. It is an economic burden for a low paid worker to travel from his home to
the zone. Then in moving to Mountain View Division, BASECO country or BEPZ
dorms, there are so many regulations. The Mountain View Division is for
high income earners because the rent for each house costs more than P250.00 per
month. The BASECO country was mainly built for BASECO (formerly NASSCO)
employees. However, when they retire or are discharged, they have to move out.
The BEPZ dorms are for single workers, but housing facilities are poor. Owing
to the above limitations, most of the NASSCO inhabitants have to look for
living space in the town proper by building a small house or renting a room
there. Yet the problem of housing for them does not stop here; they still have
to pay the rate to the landlord monthly and are limited by contract in addition
to the lack of taps, toilet, drainage or even electricity. If the government
confiscates their land for further development of BEPZ they have to seek
another place. They are uncertain of their future residence. The living
condition in Mariveles was a shock to our group.
Squatters: Squatters
are the joint product of poverty and the shortage of permanent housing. In Mariveles, squatters can be found everywhere. People become
squatters because of their low wages and crowded tenements.
The
houses of squatters look insecure, dirty and dangerous. The open drains and lack
of water supply make the preparation of food seem a risk to health. They have
to walk a distance for water and toilet. At night the feeling of backwardness
is obvious for many of the squatters do not have electricity because they
cannot afford it; thus, candlelight is used.
The
overall picture of squatters is disorder and improvisation. Squatters are a
menace to private and public health and their settlements are a refuge for
criminals and drug addicts.
The
government does not take care of the squatters; rather government officials are
hostile to them. In a conversation we had, the chief of police told us that one
of his responsibilities is to demolish squatters’ shacks.
The
general conclusion that one can draw is that to develop BEPZ, the government is
only concerned with native capitalists and foreign investors. But the basic
condition for the habitation of
the people is ignored; since NASSCO had been cleared by force by the government, it is now lying
idle awaiting development by foreign investors. But the basic condition for the
habitation of the people is ignored; since NASSCO had been cleared by force by
the government, it is now lying idle awaiting development by foreign investors.
Since
the development of BEPZ, the farmers who had lost their land and the workers
who had suffered dislocation have sunk further in hardship and poverty. On the other hand,
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the setting up of BEPZ has made the
rich richer.
Since
the development of BEPZ, the farmers who had lost their land and the workers
who had suffered dislocation have sunk further in hardship and poverty. On the other hand, the setting up of BEPZ
has made the rich richer.
The
second most important problem of the people of Mariveles
is water availability. The water system, which was installed in 1947 after
liberation, served a much smaller population. It is understandable that with
the upsurge in population, the water system cannot cope with the present needs
of the town. Many places have wells; other people draw water from a public
faucet (a long walk) or buy water at P2.50 per container.
Poor
living arrangements and the lack of water are reflected in the morbidity and
mortality figures for the region especially in the prevalence of
gastro-intestinal diseases which are the most common illnesses and also the
largest significant cause of deaths. Also, since the zone was constructed there
has been an increase in bronchial diseases; no special reason was given for
this,
Other
problems have arisen from the immigration of workers. For example, the
area was previously malaria free but workers coming from other parts of the
country have brought it to the region. It is not widespread but care will be
necessary to keep in under control.
There
are a great number of social problems which have arisen as a result of the
dislocation of people. People who were removed from NASSCO are usually
unhappy and resentful. Workers in Mariveles are torn
away from their families. Many girls interviewed said they did not want to work
and would rather be with their families; however, they are forced to work
because they help support their families.
Concerning
mental health, generally problems are caused by extreme poverty. This has been
aggravated lately by "self – induced" problems for some
particularly among the youth who are on drug addiction.
Some
other aspects of the effect of the zone on the people of Mariveles
are: 1) the cost of living has increased dramatically from 5% to 30% in
comparison with the prices in Manila. 2) Increased wealth in the area which is
reflected in the municipal budget: 1967 – P55.000 and 1977 –
P1,000,000,000 and 3) the increased wealth in the municipality should mean more
public services. Although there has been marked expenditure for health and
agriculture, the rate is not equal to the rate of population growth. This is
most evident in the lack of public service facilities such as schools.
Speculations are high that sooner or later, Mariveles
will be relocated as the zone keeps expanding, getting closer and closer to the
town.
Interview
with Religious Leaders
In
spite of the enormity of the problems of the people brought about by the
development of the zone, the group felt that it was no cause for despair.
This was mainly because of our encounter with people who are doing work within
the community. Some religious leaders in Mariveles
held a discussion with us and through them we learned of their efforts to
create awareness among the people regarding their conditions so they,
themselves, can organize and act towards meaningful changes.
A
concrete contrast of 'the conditions there pointed out were the church building
in BEPZ with that in the town. The ecumenical chapel which cost P6 million is
located on top of a hill inside the zone and has marble floor and very
expensive fixtures. In contrast the Catholic churches are all under
construction — just shell enough for people to worship in.
The
people are quite aware that their problems, their lives, are interlinked with
forces outside themselves - those of the government, those of the
capitalists and companies outside and all the structures that have been built
to keep this arrangement stable. But
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the people are also aware that changes
not only in their lives mean a change in the structures which govern their
lives. And the members of the group felt that seeds in the people have begin to
grow so such changes can be made possible.
GROUP MEMBERS:
Ricky Yick Tai, Janice Calvert, Linda Sumilat,
Jennie Hurley and Lin Newman.