DO JIHADIST ABDUCTORS HAVE FUNDS TO BUY PHILIPPINE ARMY’S GUNS?

Erle Frayne Argonza

Good afternoon from Manila!

The headlines and front pages of the major dailies here are focused (scoop) on the Ces Drilon abduction by the Abu Sayyaf, the CIA-created jihadist group operating in Mindanao (southern Philippines; Ces Drilon is a rated journalist of the oligarchic ABS-CBN). Reports say the P15 Million rock-bottom ransom is out, and that the jihadists have signaled an ultimatum.

As this is happening, the national army is massing up troops and intelligence assets in the area, supposedly as part of the ‘stick tactic’ that could glue the terrorists to the bargaining table. This is old-hat psych-op that belabors on the obvious, which even kindergarten minds are aware about.

The real score in the current ‘abduction game’ as well as in previous ones is that it is an opportunity for rouge military officers to sell armaments to the terrorists. I have already tackled the matter of rouge arms sellers, and factored the USA’s Pentagon neo-cons as the current force behind such abominations within the Philippines’ armed forces or national army.

As discussed in a previous article, terrorist abduction is an amusingly ‘win/win’ situation in an affected area. I also tacked the matter of pricing strategy for ransom and the network of peacekeepers involved in the process. The one bannered on headlines, worth P15 Million, is the rock-bottom price, while the maximum ransom, per estimates leaking to media and experts, shoots up to $5 Million.

The question that comes into mind now is, with the massing up of army operations in the affected area (Indanan, Sulu island province), how would the abduction be handled as a whole from both sides? Aware that rouge elements are inside the army who are up to sell arms to the jihadists, do the terrorists possess the funds for paying the rouge soldiers?

The problem, which finance experts may better reflect on, is that the cash to pay rebels hasn’t been fully forwarded yet. The only cash paid so far was for the release of the camera crewman of Drilon, who is a low-bankable player and in the latest abduction game. Though seemingly a nuisance, the value of the crew is that, while negotiations were in process for his release, the jihadists were able to spy on the connecting threads and linkages of operators and peacekeepers on the “other side” of the table.  

Such a situation is precisely what hedge funds are for. Portfolio capital can serve precisely as cash forward to the party involved (jihadists), while the same portfolio operator can likewise hedge the scheduled cash flow inputs of the paying group (Lopez group). As I was saying in a previous article, insurance companies and hedge funds operators have a ‘window of opportunity’ in the context of a ‘force majeure’ event such as terror abduction.

The final question is, in case that no cash forwards will get through to the jihadists, and no guarantees for luscious purchases by the army and designated bagmen operators, will the ‘stick operations’ pursue? Will Drilon finally be released by the jihadists in case that they feel the pressure from the army assault on their lairs?

These types of operations are already routine in Mindanao’s life and hardly make a dent on public attention that is focused on other hard issues like oil price hikes and inflation. What makes the case unique is the person of Drilon who is an asset of the ABS-CBN, a Lopez family firm. The jihadists know the great sins of the Lopez utilities notably the Meralco on the public, which could factor in the dynamics of the abduction.

Needless to say, the Lopez sinners can pay the price of the latest game. Government can also exact a bit of revenge for the beating it got when its board representatives in the MERALCO lose in bidding for chairmanship and juicy posts. Or, perhaps a turn-around that could see the release of Drilon and heavy beating (with high casualties) of the jihadists would happen, thus increasing the palatability of the government control of the MERALCO firm.

The scenario is no determinate one as the situation is fluid. You can make your own guesses about the compass of the abduction. In case you’re following up on the news, better do your own scenario building now while the “soup is hot.”

[Writ 17 June 2008, Quezon City, MetroManila]

KICKBACKS & PEACEKEEPING, TV JOURNALIST’S ABU SAYYAF ABDUCTION

Erle Frayne  Argonza

Good afternoon from Manila!

As of this moment, Manila is in the heat of coffee shop speculations about the fate of the recently abducted Ces Drilon & crew, personnel of the oligarchic network ABS-CBN, by the Abu Sayyaf. The ‘cara y cruz’ debate is whether the Lopez group will pay for the ransom of Drilon & crew, amounting to $5 Million more or less.

Having observed peacekeeping for some time now, and having had the privilege of being close to peace negotiators on both camps (state and rebel counsels), I know very well about the perks that go with peacekeeping. A favorite popular idiom today, when one is uncertain whether to push through with a work engagement, is “i-career mo na” (make a career out of it). This goes through for peacekeeping.

Let me ping straight to the point: there’s a lot of kickbacks in peacekeeping, that is why it is a great project engagement for any state official to role-play peacekeeper. On the terrorist side, mujahideen work becomes adventure, fun and good life as sweet money would come around every time that abductions and raids would be mounted. Abduction, specifically, is a ‘win/win’ situation (Fidel Ramos favorite idiom).

Here is the value chain of abduction: A group of young terrorists are tasked to abduct any bankable personage or group. Most probably a preliminary assessment had been done about the ‘book value’ of the proposed victims. With all parameters and actions observed (on the backward and forward linkages, inputs and outputs), the group then proceeds to abduct the bankable victim and team members.

The ever ready peacekeepers, actual (those with mandates) and potential (those local and other personages who can do go-between or back-channel tasks), will then quickly respond to the situation. The terrorists are aware of the chain of peacekeepers, and knowing the “10% goes to Boss” S.O.P., they already padded the price of the ransom. A lot of contingency expenses are entailed in the negotiations, a lot of risks too, so all operating expenditures must be covered in the ransom estimate.

The bargaining then begins as soon as the peacekeepers rendezvous with the terrorists or their authorized agents. To show semblance of civility and concern, the peacekeepers would try to strike a bargain, but not rock-bottom please. Nobody wants to come home empty-handed, please understand.

Upon doing the preliminary rendezvous, the terrorist group or T-Group would then re-assess the estimate. They have already done their own counter-espionage about the ‘chain of peacekeepers’, so this dovetails in the decision whether it is sound to scale down or move up the ransom. Factoring along the number of new T-Group recruits who may need immediate ‘glad tidings’ support is also an important decision input here.

The family or firm that is set to pay ransom will make the pronouncement that “there will be no ransom” and the rationale that “we will not and never will negotiate with criminals and terrorists.” This is a mere cover-up by-line, remember, I know this for a fact. Non-payment is too remote from reality, I’m very certain about this.

What is factual is that the family or firm would have to decide quickly to pay more as soon as a bargain had been done via back-channel. Often than not, the paying group must also offer gifts (payola incentives) to the back-channel negotiators. Payment must really be quick and sweeping. Because failure to do so would make the T-Group raise the ransom, and the negotiations after that would be more difficult, hazardous, and  the chain of peacekeepers would rise, perhaps following 2-3 chain tracks.

So, what happens upon the conclusion of the deal is that everybody will be happy. Jihadists are awash with funds for operations and payments of assets, locality’s banks are awash with fresh cash that will then circulate back into the local economy, and happiest of all will be the peacekeepers whose purses and secret vaults will bulge with fresh funds. Everybody gets a lot of news exposures, the media personnel abducted will have tons of materials for new write ups and reportage, the paying group will project an angelic mien as philanthropic moguls worth your emulation.

Perhaps the insurance companies should cash in on terror abductions and attacks, and open up ‘terror insurance’ or maybe peg them as ‘force majeure’ with specifications applicable to terror-operated abductions. And, maybe they can even partner with wealthy peacekeepers to study the viability of hedge funds operations for abductions. Isn’t this a fantastic proposal?

[Writ 15 June 2008, Manila, Quezon City]