LETTER OF INSTRUCTIONS NO. 288

TO    :      The Secretary Department of National Defense

        The Secretary Department of Finance
        The Director-General National Economic and
        Development Authority
        The Secretary Department of Public Works and
        Transportation and Communications
        The Chairman Development Bank of the Philippines
        The Chairman and the President Philippine National Bank
        The Chairman and the President Philippine Exchange Company, Inc.
        The Commissioner Bureau of Customs
        The Administrator Sugar Quota Administration

1.    Reduce the cost of warehousing and handling of export sugar through mass storage in strategic areas;  

2.    Allow prolonged storage of export sugar without spoiling its quality;

3.    Provide flexibility in marketing and shipment of export sugar especially during period of depressed prices;

4.    Relieve the mills of the problems of warehousing by providing them centralized and strategically located storage facilities; and

5.    Allow inventory financing of unsold sugar by means of secured storage backed up by unquestionable warehouse receipts.

1.    The Department of Finance and the Bureau of Customs to immediately make available their property within the customs zone of the Pulupandan Port where the facilities shall initially be constructed, and such other properties as the Philippine Exchange Company, Inc. may deem necessary;

2.    The Philippine Exchange Company, Inc. to immediately enter into negotiated contracts with reputable private construction firms or government entities for the construction of the warehouses, inloading, outloading and pier facilities. These contracts shall be exempt from existing laws, rules and regulations on public bidding and government corporations;

3.    The Department of Finance, the National Economic and Development Authority and the Bureau of Customs to facilitate the procurement of construction materials and bulk handling equipment which, if not locally available or if necessary, as determined by the Philippines Exchange Company, Inc., may have to be imported from foreign suppliers. Said importation shall be exempt from customs duties and taxes;

4.    The Development Bank of the Philippines to provide financing assistance to the project by means of a fifteen-year loan;  

5.    The Department of Public Works, Transportation and Communications to provide the dredging and reclamation work for the project. When necessary, the Philippine Exchange Company, Inc. may request the assistance of the Corps of Engineers of the Armed Forces of the Philippines, and the Secretary of National Defense is hereby directed to provide such assistance;

6.    The Sugar Quota Administration to require all sugar mills to construct and/or maintain adequate warehouses which shall have the capacity to store at least forty (40%) percent of one (1) crop year production, as well as facilities for domestic sugar.

Since 19.07.98.