60 Public-private partnerships and the new squatters of capital

Christopher John “CJ” Chanco, University of the Philippines-Diliman, Phillipines

An understanding of the processes driving urban land conflicts in the Philippines requires us to look at the connections between the historical neoliberalisation of the country and new mechanisms of extracting value from the city. Regimes of dispossession as they occur across different contexts are bound together by broadly similar processes, i.e. the crises of capitalism and profit motives of the capitalist class; although it would be wrong to suggest that neoliberalisation is a monolithic affair conducted through the same institutions at the local level, with identical results.   Neil Brenner speaks of the “path dependency” of the neoliberal project, which takes different forms according to the historical, socio-political, and cultural contexts of the countries where neoliberalisation takes place.

Neoliberal gentrification and revanchism in Philippine cities extend back to the Martial Law era, most notably with Imelda Marcos’ urban beautification drives attempting to turn Manila into the “City of Man”. But competing narratives of progress, the desire to attract foreign investment and tourism, and mass evictions and displacements of the poor in many ways still resonate in the developmental priorities of the state under the guise of modernisation. The only difference is that these same processes today involve an even wider, globalised web of state institutions, foreign investors and their local counterparts – a transnational capitalist class I christen the new ‘squatters of capital’ – in mutually beneficial regimes of accumulation, rooted in globalised flows of speculative and extractive capital.

Capital’s squatters reside in public-private partnerships (PPPs) that are the latest modality for ABD, as they sequester wealth via these new modes of accumulation in partnership with the state. Running the gamut from build-operate-and-transfer (BOT) to build-transfer-and-operate (BTO) schemes, PPPs grant certain rights to corporations that extend throughout the duration of a PPP contract, usually a period spanning decades, after which these projects are either to be returned to the state or are managed in perpetuity by the private sector under a set arrangement.

PPPs are just one among a number of neoliberal technologies of power enlisted to fulfil the classic functions of the capitalist state as it balances between the interests of capital and securing legitimacy for itself. Put simply, placing public before private in the language of partnerships goes down easier with the electorate than straightforward privatisation. Meanwhile financial deregulation and the deterritorialisation of capital have fed the rise of the “contract state”, which arbitrates value in the built environment, attempts desperately to capture the interest of footloose investors, and negotiates the social terrain to ensure the least possible barriers to big business.

PPP investments in the Philippines peaked in the mid-1990s, declined in the aftermath of the Asian Financial Crisis, but have made a recent come-back with the Aquino administration championing PPPs as its flagship development initiative. Previously limited to infrastructure projects, water and the energy sectors, PPPs are now expanding into healthcare, information technology, mass transit, public housing, even the construction and operation of prisons[1].

Yet infrastructure still accounts for a significant share of PPP projects, partly to make up for years of ‘woeful’ public spending on the sector – in a telling illustration of capital’s need for speed in the transit of labour and commodities. A battery of new airport terminals, expressway toll way systems, roads, and transit lines are assumed to raise real estate prices, entice tourists, and assure investors of the country’s status as a new Asian tiger ripe for the picking, and are spurring significant transformations of the built urban environment, against which the urban poor are perceived to be literally squatting in the way of progress.

In his explorations of the post-political city, Erik Swyngedouw reflects on the entrepreneurial nature of the built environment of the city, which has increasingly come to depend on flows of fictitious or speculative capital. The living conditions of informal and precarious labour, by contrast, have been steadily undermined. Couched in the language of competitiveness and efficiency these costs are touted as the inevitable price of modernisation and the new in the global city. But PPPs are variations on an old theme, inasmuch as popular democratic forms of accountability in the Philippines have always been limited, and a parasitic privatised state has actively underwritten capitalist accumulation by a narrow subset of political cliques and rent-seeking capital.

In contrast to the rhetoric around promoting competition, PPP projects are concentrated in a small number of elite. Five business conglomerates shouldered 51.3% of the total cost of PPP deals in infrastructure alone between 1984 and 2012 that were collectively worth close to USD 60 billion. These have included old players like San Miguel Corporation, Aboitiz, and Ayala Corporation – owned by politically well-connected clans with landholdings inherited from the Spanish colonial era – as well as the noveau riche, like Metro Pacific Investment Corporation, a joint venture between stock market tycoon Manuel V. Pangilinan and Indonesia’s Salim group, and Megawide Constrruction, owned by mall tycoon Henry Sy.

Traditional forms of political power in the Philippines, including the landed oligarchy and corporate monopolies, are thus reinforced and simply adapt to emerging neoliberal trends. Local landed elites are transitioning from their traditional bastions in the sugar or tobacco industries toward more corporatized models of business and speculative real estate, responding to the state’s generous incentives and open calls for the privatisation of public space.

Neoliberal forms of urban policy and redevelopment are the default developmental framework of the Philippine government, fuelled in part by the historical momentum of the fall of the Marcos regime, and the associated inefficiencies of a stigmatised government bureaucracy and public sector. The Asian financial crisis made subsequent governments even more responsive to neoliberalisation, and the private sector has since been elevated to the status of imprimatur of development. While historical underdevelopment of the country’s manufacturing and agricultural sectors persist, local elites have come to depend even more on state support for their speculative investments.

These ‘squatters of capital’ have impacted significantly on the politics and production of urban space. PPPs have ushered in fresh waves of urban dislocation and structural violence in their wake, driving evictions while overseeing housing projects for the displaced.

What results is a spiral of structural violence, limited only by the extent to which the urban poor are able to mobilise and carve space for themselves against ongoing threats of eviction and marginalisation. For not all is a one-way street. Capital is constantly made to modify its strategies toward the subaltern according to a variety of geographic and political considerations. Implicit in this is the potential for subaltern sites to turn into sites of resistance to the predations of capital, offering hope that the urban commons can be reclaimed.

I conclude that there is a need for more attention to dispossession at the urban scale, and to the dynamics between urban and rural dispossession that has provided ready fodder for capitalist dispossession. Such themes could form the basis for powerful urban ethnographies, counter-mapping and counter-histories by the urban poor. Indeed such attempts are already underway through joint efforts by academics and urban poor solidarity groups like the Urban Poor Resource Center of the Philippines (UPRC)[2]. A better grasp of urban dispossession can, in addition, aid social movements in the mobilisation of the informal sector as a terrain for political action in the city. The challenge is to empower communities on the ground –sustaining resistance and connecting varied sites of struggle across geographic borders.

By analysing and contesting the violence of dispossession, dominant discourses of fear and othering can be replaced by narratives of resistance and hope.

Author notes

This article is an extract from a longer unpublished work, Squatters of Capital: Regimes of Dispossession and the production of subaltern sites in urban land conflicts in the Philippines.

[1]A variety of private contractors are involved in the construction and maintenance of a Php 40.29 billion (USD 895.33 miilion) prison facility in Fort Magsaysay, Nueva Ecija, in coordination with the Department of Justice. Information on the latest projects are available at the PPP Center website: http://ppp.gov.ph

[2]Two such counter-history exercises were organised by UPRC in 2014, through conferences focussing on the history of Sitio San Roque, with insights provided by generations of urban poor community leaders, activists, and recent migrants [For more information about UPRC, please see http://uprcp.wordpress.com/]. I owe a debt of gratitude to the organisers of these seminars, as well as to Kristian Saguin and Andre Ortega of the University of the Philippines-Diliman, and Chester Arcilla of the University of the Philippines-Manila, all three of whom have focussed intensively on issues surrounding land dispossession and the urban poor.

Author Biography

Christopher John “CJ” Chanco is a graduate student in the Department of Geography at the University of the Philippines-Diliman, with research interests in political ecology and the geographies of dispossession and resistance. He was formerly a policy researcher on global development and civil society at Ibon International.

Contact email: chrischanco@gmail.com

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