A Cost Benefit Analysis of the Davos Trip

A Cost Benefit Analysis of the Davos Trip

Was It Worth It?

January 22, 2023

The "Huge" interest in the Maharlika Investment Fund

Generally, a cost-benefit analysis is done before an activity is undertaken, and only if the perceived benefits exceed the costs of the activity will it be undertaken. Obviously this was not done with respect to the President’s Davos trip. If this is an indication of how decisions are made by the President, it does not augur very well for the country. 

Or maybe an analysis was done, but the costs and benefits that were considered were not those accruing to the Philippines, but those accruing to the President’s private interests – such as clearing the blot on the Marcos name (which the President actually discussed in a plenary session of the World Economic Forum),  or being able to withdraw hitherto unknown funds from Swiss banks which required personal attendance. This last is pure speculation on my part.

But when the President and his entourage returned from Davos Saturday, he will be enumerating the  benefits that the trip will bring to the Philippines – the soft launch of the Maharlika Investment Fund (MIF)/Sovereign Wealth Fund (SWF) which has not even been approved by the Senate, and the “huge” interest expressed by the World Economic Forum attendees not only in the the MIF/SWF but in the Philippines as well.   

As for the costs of the trip, I am willing to bet there will be no mention of  the travel, food, accommodation costs, which are easily quantifiable. Nor of the price for general admission plus the price of admission to different sessions.

 The Palace initially released the names of 18 members of the delegation – the Presidential Couple, four members of Congress (Gloria Arroyo, son Sandro Marcos, cousin  Speaker Martin Romualdez and wife Yetta, also a party-list representative), one Senator (Martin Villar), six Cabinet Members, three undersecretaries, a Special Assistant and a Presidential Adviser.  But because of the criticism on the size of the delegation, it clarified that only 11 of the 18 were registered at the WEF—which means only 11 had to pay for admission.  A savings, hoorah!  Then why did the other 7 have to go in the first place?

But I go ahead of myself.  Let’s take these one by one.

BENEFITS: 

1.  A Successful Soft Launch?

Soft Launch of the Philippines MIF/SWF.  This was touted to be the President’s primary reason for the trip (if his mother Imelda were around, she would have used the term “primordial”). TV cameras showed us the room where  the Country Strategy Dialogue, took place.  

Did you notice Reader?  As shown on TV, it was a narrow room with two rows on each side along the length of the room.  From the footage, the two rows on the left side  were occupied by the Philippine delegation plus the seven billionaire businessmen, and the two rows on the other side were occupied presumably by those interested in the discussion. What struck me, and what should have struck the television viewers, is that there were more of us than of them.  I counted. There were exactly 13 attendees on the right side of the room. See for yourself.

The news coverage gave the name of the moderator, but did not give any clue as to which foreign corporations or country representatives  were part of that thirteen. Yet strangely enough, it supplied the names of every single person who attended a dinner hosted by the GRAB Filipino billionaire ( including Jared Kushner, the son-in-law of Donald Trump). What kind of reporting is that?

The point is, folks, that with 13 anonymous people out of a possible 2,500 WEF participants, what does that say about the success of the President’s “soft launch”?

2.  Create widespread business/corporate interest in the Philippines?

Again, did you notice Reader, that every assertion about the “huge”, “strong” “positive” interest in the Philippines or its SWF, was made by members of the Philippine delegation or by its billionaire businessmen?  Why weren’t the foreign attendees to the country strategy dialogue where PBBM soft-launched the MIF, interviewed, much more identified? After all, there were only 13 of them. 

The point being, folks, that if interest was large and positive, who evinced the interest?  Why can’t the Philippine delegation mention some names?

COSTS.  

1. Travel:  

The costs of travel for the delegation should easily be obtained.  The government chartered a B-777 aircraft from PAL, and by the way, Vera Files ascertained that the allegation that a flight to Vancouver was cancelled because of this is NOT TRUE.  That having been said, one cannot understand why media has not determined the cost of the chartered flight. But I  googled the cost of chartering such an aircraft, and I found that the average cost is $28,500 an hour. Flight time from the Manila to Davos is estimated at 13 hours, 23 minutes.  So total cost of a round trip chartered flight is about $760,000 or P38 million (at P50=$1).  

2. Accommodations

Klaus Schwab, the founder of the WEF, complained about 5 years ago that accommodations in Davos were too costly, and WEF may have to look for another site for its forum. The following are very rough estimates: 

A double room at the center of Davos during WEF costs about P300,000 a  night.  Assuming that everyone is doubling up (which is highly improbable), the total bill for a six-day stay for 18 delegates sharing rooms would by about P16.9 million.

I will assume that the cost of  lunches and dinners will be picked up by the billionaires.  If they are not that generous, then our total costs will rise.

3. Cost of admission to WEF: 

A ticket costs $19,000(P950,000). Since only 11 of the delegation went inside, that would add P10.45 million to the costs. But apparently to get a ticket, one has to be a member of the WEF itself, and that entails membership fees that on a sliding scale go up to as much as $500,000. I will assume that this membership fee was again underwritten by a billionaire’s corporation.  

The very much understated cost of travel, food and accomodations come up to P65.35 million.  

Summary:  A trip costing at least P65 million results in expressions of interest about the MIF/SWF from,  at most,  13 nameless attendees of the WEF, if we assume that  all who attended the country dialogue were impressed.  

Note:  the latest wrinkle on the MIF/SWF is that Congressman Joey Salceda now claims that it is completely different from the original. So what was President Marcos selling in Davos?

 

As I See It

The Official Blog of Winnie Monsod

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