(First of two parts)
As the mayor of Bambam was slowly exposed to be an allegedly fake Filipino, the public may not have noticed that a clash between a mainlander Chinese with alleged criminal roots and a Filipino-Chinese who is big in politics and whose family has substantial business interests was taking place.
We are talking here about how Senator William “Win” Gatchalian helped pin down Alice Guo, now alleged to be Guo Hua Ping, for being fake Filipino and reportedly behind a wide network Chinese syndicates operating offshore gaming businesses, known as Philippine offshore gaming operations (POGOs), in the country.
A look into the background of Gatchalian will clearly reveal his Chinese roots: his father is the industrialist William Gatchalian and his mother is Dee Hua Ting, who are obviously with Chinese roots. His mother may be even pure Chinese.
His father is also behind the company that has a major reclamation project in Manila Bay, the 318-hectare Manila Waterfront City Reclamation Project. The senator’s father was also known before as the “plastics king.”
As to why Gatchalian has taken up the cudgels to pin down Guo and end operations of POGOs in the Philippines may also be rooted in fears that scrupulous Chinese businessmen from the mainland can make their way into the country and compete on uneven or unfair terms with the well-established Filipino-Chinese elite who largely play by the rules.
This, as there are Chinese business entities and personalities from the mainland who are known to have “mafia-like” behavior and are interested more on gaining profit than producing wealth that benefits society.
Chinese businessmen directly from the mainland exhibiting “mafia-like” behavior was discussed exhaustively in a paper released in 2021 and authored by Meg Rithmire of the Harvard Business School and Hao Chen of the University of Southern California.
Their paper titled ‘The Emergence of Mafia-like Business Systems in China” gives an almost damning account on how mafia-like business with Chinese roots operate:
“Mafia systems do not just pursue rents as a sort of ‘non-market strategy’ to enhance corporate performance; rather, they are organized to facilitate the flow of public resources into private coffers, mostly with any productive activity as epiphenomena”, the paper said.
“Plunder was present at inception for many of the private business systems that rose to the apex of the Chinese economy between 2004 and 2014,” it added.
POGOs as legitimate businesses
On the surface, the POGOs raided in Bamban and Porac look like legitimate businesses, with the one in Bamban resembling a smaller version of BGC in Taguig. It so happens that Chinese businesses have mafia-like behavior are careful in acting not like a violent mafia, at least on the surface.
“These mafia-like business systems are not actual mafia—i.e. they do not threaten and use violence or challenge the state’s monopoly on the use of force—but the widespread extortion, clandestine activity, and use of political threats (of exposure) make them a close analogy,” the paper said.
Another feature of Chinese mafia-like behavior is “mutual endangerment” which the authors defined as “is a pattern of relations by which participants hold one another hostage with mutually incriminating information.”
“Like plunder, mutual endangerment characterizes systems’ relations with political elites inside the state and within the organization. Mafia systems invest in relationships with political elites because, as the literature predicts, they benefit from privileged access to state resources, but also because those relationships are insurance that the state will refrain from disciplining them,” the paper said.
And amid the probe on the Bambam and Porac POGOs, it was obvious that such large operations could not have been possible without the collusion of local officials and even the local police force. The mayor of Porac, in particular, has come under fire for not knowing that the POGO operation in his town hosted illegal activities.
Gatchalian also lambasted the Philippine Amusement and Gaming Corporation (PAGCOR) for its “blatant failure” in stopping illegal POGO operations in the country.
There are also suspicions that those behind the large-scale operations of illegal POGOs in the country operated by Chinese businessmen have connections in the national government and prominent politicians.
While the Filipino-Chinese community has not rallied behind Gatchalian, they definitely owe him a lot as the entry of mainland Chinese businessmen with mafia-like behavior could be very bad to the Filipino-Chinese elites, especially over the long run.
To their credit, the Filipino-Chinese business community have contributed much to the country’s job creation and economic development in the past decades. And for sure, they don’t want competitors who employ mafia-like behavior, including those from the mainland.
Part two of this two-part series will discuss how Chinese businesses from the mainland with mafia-like behavior undertake ‘stealth’ operations to gain local resources, and why the Philippine business community should worry about this.
(Photo from PNA)
