A close friend of President Ferdinand E. Marcos had become a very wealthy man - and a symbolic figure - through his deep involvement in one of the largest sales ever by a U.S. company to the Philippines.
The good fortune of Herminio Disini, who in five years has grown from a small businessman to a magnate with a giant conglomerate of 35 companies, typifies the growing ability of Marcos' friends and relatives to reap huge financial rewards and influence the economy under his martial law. Marco's rule has been stregthened this weekend by a referendum on his five - year - old martial law. Partial results from the voting Saturday have led government officials to predict a near unanimous vote of confidence in the president, who has come in for strong criticism by civil rights advocates here and abroad.
Disini, 41, was the owner of a small cigarette filter company before Marcos declared martial law in 1972. His greatest coup in the years since then has been his role in helping Westinghouse Electric put together a $1.2 billion nuclear power plant deal here.
A frequent golfing partner of the president and an in-law of the president's wife, Disini has sold the insurance policy for the Westinghouse project, won the civil construction contract and earned an agency fee of "a few million dollars" for the success of one of his companies in winning the contract for Westinghouse in the first place.
Disini is one of at least a half dozen Marcos friends and relatives who have prospered since Marcos assumed the power to issue trade and tax edicts by fiat under martial law.
Foreign business sources here say government offices have delayed in granting licenses to companies not in favor with Marcos and government financial institutions have helped underwrite large deals for favored companies. In at least one case, Marcos issued a direct presidential decree that in effect granted Disini significant trade duty advantages over other cigarette filter manufacturers.
Marcos, in an interview, denied that Disini or any other businessmen particulary close to him had gotten special consideration. He said he was using his martial law powers to help as many Filipino businessmen as he could, both friend and foe, to benefit the whole economy. Some of his friends were influential businessmen long before martial law, he added.
"Is there any businessman who is not my friend?" Marcos asked. "Is there anyone who wants to make money in this development program who wants to say in my face that he dislikes me?"
At least one key Marcos adviser admitted that some did political foes of the president have been stripped of lucrative enterprises by intervention from the presidency on behalf of their competitors. But the adviser insisted that these were [WORD ILLEGIBLE] who in the last had abused their economic power [WORD ILLEGIBLE] frustrate attempts to reduce corruption and spread wealth to poor Filipinos.
There are constant rumors, but no readily available evidence, that Marcos has personally profited from his friends' and relatives' good fortune. His wife, Imelda, now governor of greater Manila and second only [WORD ILLEGIBLE] Marcos in influence here, frequently goes on expensive shopping trips abroad.She also regularly solicits large donations from the palace's friends for hospitals and cultural centers in the capital.
Marcos himself lives simply. To his friends he seems to be interested in money only to the extent that it can be used to defend himself against wealthy enemies who might otherwise buy off the political support he needs to [WORD ILLEGIBLE] social and political change.
The government announced that Westinghouse had been awarded the contract or for the Bataan nuclear power plant - the first of a planned series of such plants - in early 1976 after Disini acquired Asia Industries, the Westinghouse agent in the Philippines.
Marcos said the decision to buy the Westinghouse plant, instead of a competing proposal from General Electric, was made before Disini became involved with Westinghouse and was based on a report from foreign technical consultants favoring the Westinghouse scheme. In any case, the decision did not reflect any personal feelings of the president, he said.
Government and business sources close to the deal said that Disini played a crucial role in the negotiations leading up to the sale and that this explains in part the several financial benefits he has derived from it. One Westinghouse negotiator has told businessmen here that the influence of Disini and Jesus Vergara, president of Asia Industries, "was essential."
An official of the government's National Power Corporation said, "The decision to choose Westinghouse was a political decision."
Power Contractors Inc., the Disini company that eventually won a contract as chief subcontractor of the civil works in the nuclear project, filed articles of incorporation with the Philippine Securities and Exchange Commission on Jan. 30, 1975, a year before the public announcement of the Westinghouse sale.
The document listed Vergara and Rodolfo B. Jacob, two men who were soon to become Disini's most important lieutenants, as members of the incorporating board. It said the new company - an amalgam of three existing contractors - had been judged "competent and capable" of handling the Bataan nuclear project, which it said "the government of the Philippines intends" to award to Westinghouse.
The project, backed by the U.S. Export-Import Bank with a $227 million direct loan and a $356 million guaranteed loan, also brought significant business to other members of the Herdis (Herminio Disini) group o companies.
Asia Industries not only is agent for Westinghouse but also for International Telephone and Telegraph, which is installing communications at the project site. Summa Insurance, a small company bought by Disini, won the contract to write a $668 million insurance policy on the project. It includes a $10 million premium.
The policy was far too large for Summa, or any other private Philippine insurer, to handle so the government's Government Service Insurance System was brought in to cover the liability.
A Westinghouse negotiator told businessmen here that Disini and Vergara received "a few million" for their assistance in winning the contract. Vergara, in an interview, said that the money was a commission to Asia Industries, which would be prorated over seven years.
Asked about the negotiations and the commission, Vergara said "this project was in my opinion, above-board."
Disini, stocky and youthful looking, was approached at a reception here honoring the World Cup golf championship after several unsuccessful attempts to reach him by phone. He declined to comment on any of his companies' financial dealings.
"Your editors will print what they want anyway," he said.
Some Philippine economists now wonder if the rising costs of construction and uranium will obliterate the $100 million a year in savings on oil imports that the nuclear plant was expected to provide. There also has been some trouble with local villagers over safety fears and the contractors' failure to hire much local labor. But building is on schedule and the 620-megawatt plant is expected to be operating by 1983.
Disini's empire continues to grow, with the reported September purchase for $25 million of a group of companies, including one tht handles the highly profitable sale here of Capterpillar tractors and other heavy equipment.
Among other friends and relatives of Marcos who have enjoyed business successes over the last five years of martial law are:
Roberto Benedicto. A fraternity brother of Marcos at the University of the Philippines, Benedicto heads of the Philippo Sugar Commission which handles trade in the country's largest export commodity. He has inherited his family's sugar plantations and also receives foreign contracts to export sugar. He controls the Traders Royal Bank, a 150,000-circulation newspaper in Manila, four of the nation's five television networks and two hotels.
Ricardo C. Silverio Sr. A close friend of Marcos, he owns the Toyota automobile franchise and the popular Toyota professional basketball team, which his son coaches. He also owns successful national franchises for Daikin air conditioners and Frigidaire refrigerators and a shipping line.