By Atty. Antonio P. Pekas

practicality.”
In the early1960s when I was in the elementary grades, I noticed the notebooks and pad papers we were using had a Globe logo. These were being produced by a company called Keng Hua Paper Products.
About a decade after that, I went to the college of forestry. My course was Forest Products Engineering. The best field of specialization I that course was pulp and paper. I left that course though when I was in my fourth year.
Then I put up, while still a law student, a small book shop in Baguio which certainly included the selling of paper products for offices and schools. So I went directly to paper companies. One of them was Globe Paper Products. To avoid the traffic of customers from all over the country, I would go early morning to their main sales office at Binondo and wait for it to open.
Decades after or about 10 years ago, somebody introduced to me in Baguio a Chinese businessman who turned out to be the son of the owner of Globe Paper Products.
Our conversation got animated when I found out he also studied forestry and majored in pulp and paper at Syracuse University in New York.
Since their family’s business was about paper, it was a great foresight of this father to have sent him, one of his kids, to the US to specialize in that field.
Another thing that came out from our conversation was their family’s having forest concessions in Mindanao. He did not have to say the reason for this. Forests are the sources of logs than get converted into pulp and then to paper.
So they would be producing the pulp and paper they would make into notebooks, pad papers, bond papers and other paper products. Since they were the biggest producers and sellers of paper products for offices and schools, they would have no problem about marketing and of raw materials becoming scarce and expensive.
With the family producing the raw materials for paper and manufacturing these themselves into finished products, they would be able to beat the shit out of anybody thinking of competing with them. Naturally, their production costs would be much lower. Ergo. Lower prices of their products.
Economists and business people call such business arrangement vertical integration. Great planning and foresight. But something went awry. For there was something the family patriarch did not foresee. The emergence of China.
From our about one hour of conversation that afternoon, I gathered their business was not as good as before. That things are now different—“iba na ngayon,” he lamented. I deduced it might be cheaper to import from China paper in rolls like gigantic toilet papers. Then just remanufacture these into small paper products for homes, offices and schools. That would be a lot easier and cheaper compared to having to take care of forest or logging concessions and then processing the logs into paper. A lot of trouble or problems.
It would have been OK if the company could export their products to foreign countries. But how can you do that, or how can you compete out there when everything is cheaper in China?
So the great plan of the family to achieve an ideally integrated business had to be shelved for practicality.
From our national perspective, hopefully, there would not be nurses, engineers, doctors, and other professionals flooding the world from China easily contented with very low wages.**