A Tourist Paradise Shadowed by Terror


By Mark L. Clifford From the serenity of the Marco Polo Hotel in Davao City, Mindanao sure doesn't look like an island that's caught up in the web of international terrorism. From my room overlooking this low-rise city of 1.4 million people, I can see the ocean and across a bay to resort-dotted Samal Island.

Yet sleepy Mindanao has been caught up in the whirlwind of terrorism and its aftermath (see BW, 10/29/01, "The Philippines: An Island Shaken by Terror"). Pentagon consultants have just arrived to help train Philippine soldiers, who are looking for guerrillas -- most people call them bandits -- from the notorious Abu Sayyaf group. Abu Sayyaf (the name means "Bearer of the Sword") kidnapped 20 people, including three Americans, from a diving resort in May. The decapitated body of one of the Americans was found earlier this month. An American missionary couple is still being held.

Abu Sayyaf claims links with Osama bin Laden, whose brother-in-law visited the group in the early and mid-1990s. Another local guerrilla group, the Moro Islamic Liberation Front (MILF), in the past has sent fighters to Afghanistan to fight alongside the mujahideen. Now, supporters in the area claim to have signed up 100,000 fighters to join bin Laden after the U.S.-led assault on Afghanistan began.

BAD HABITS. Even before the September 11 attacks, it was pretty easy to get spooked by Mindanao. Fighting has been going on since the Spaniards tried to colonize this Muslim outpost more than four centuries ago. Two Muslim guerrilla groups (the MILF and the Moro National Liberation Front, or MNLF) have fought the government on and off for three decades. In the past two years, Abu Sayyaf -- seemingly more interested in cash than politics -- has kidnapped scores of people, including a slew of foreign journalists who had come to check out the action last year. Close to where I'm staying, two security guards were killed in May when the most exclusive resort on idyllic Samal Island, Pearl Farm Beach Resort, was approached by a boatful of gunslingers.

The U.S. has a travel advisory on much of Mindanao, warning that travelers could face "crime and insurgent activity" in a number of provinces. More generally, the U.S. State Dept. warns that "the threat of terrorist action by extremists, both domestic and foreign, does exist in the Philippines. There are periodic reports of plans for possible kidnapping or terrorist acts aimed at U.S. government installations, public and private institutions, and transportation carriers." And on Oct. 17, an Italian priest who had lived on Mindanao for three years was abducted while saying Mass.

Yet the unrest I found had very little to do with international terrorism and a lot to do with local grievances and the habit of using guns and grenades to solve problems. Some of these problems are stubborn legacies of centuries of underdevelopment and colonization. Others are just personal grudges.

LOST AT SEA? Take the Oct. 17 rocket-grenade attack on the port of Cotabato City, about 90 miles east of the city itself, which the U.S. embassy advises people to stay away from. Sounds alarming. But it seems, according to local papers, the acting port head suspects his recently ousted predecessor of being behind the attacks. So the problems probably boil down to a squabble between two men -- both former guerrillas -- who each wanted to run the port.

And that attack on Pearl Farm? Reports at the time blamed Abu Sayyaf for the gun battle at the famed resort. But locals now say they aren't so sure. One plausible theory lays it on a gunrunning operation gone wrong. Gunrunners (who may have been Abu Sayyaf members, but probably weren't), trying to move their muscle across the bay south of Davao City, ran into high seas and the crew got lost. They pulled up to Pearl Farm to ask for directions. Security guards at the resort figured, reasonably enough, that a boat filled with gunslingers approaching in the middle of the night meant an assault designed to snatch some foreign tourists. The guards started firing, the pirates started firing back, and at the end two guards were dead.

The September 11 terrorists attacks in New York and Washington have battered Mindanao's tourist economy. Not because Mindanao is really the focus of a new war on terror -- but because nervous tourists have crossed this lovely island off their list. The Japanese government slapped a ban on travel companies offering tours to the island. Though the crime rate in Davao City is lower than in Manila, even people from the capital are afraid to come. Rooms at the deluxe Marco Polo, which at 18 stories is Mindanao's tallest building, are going for just $65 a night. The hotel's staff of 300 will have to worry about their jobs if the slump continues.

HOPEFUL SIGNS. Mindanao could use a break -- and may actually be getting one. The first elections for the Autonomous Region of Muslim Mindanao are set for Nov. 26. One of the major guerrilla groups, the MNLF, signed for peace five years ago. The other, the MILF, has agreed to a ceasefire and started peace talks in the Malaysian capital of Kuala Lumpur on Oct. 16.

Hopeful signs abound that peace, given a chance, could flourish in Mindanao. One of the candidates for governor of the new Muslim region, Ibrahim P. Paglas III, or "Datu Paglas" as he is popularly known, comes from an influential family in an MILF-dominated area about 90 miles southwest of Davao City. At 24, Paglas took over as mayor of the town named for his family, the eponymous Datu Paglas, after his father was maimed and a younger brother killed in a grenade attack in the mid-1980s. (Datu is a hereditary honorific.) Back in those days, a dump truck filled with nearly 50 armed men provided security. (Dump trucks, Paglas and an aide explain, were good because they were high off the ground and offered his men a clear shot, yet their walls provided protection from return fire.)

In the 1990s, Datu Paglas invited some foreign investors, including Chiquita Brands International and a Saudi and Italian group, to build a banana plantation on family lands. The U.S. Agency for International Development has chipped in with technical assistance. So, too, have Israeli agricultural experts, even taking some of the plantation workers to Israel for training. The $26 million plantation now employs 2,000 people, mostly MILF cadres or supporters, and exports $15 million annually. Datu Paglas says his is the only Muslim town in Mindanao (and probably the whole country) with its own bank.

Is this venture at odds with the aims of the MILF? Not at all. Datu Paglas' uncle, who is the guerrilla group's chairman, has given his blessings to the project and to the Israeli assistance. And the dump truck full of armed soldiers? No more. Datu Paglas now travels unprotected, or with just one or two bodyguards, putting his faith in Allah to keep him safe. If Mindanao is to thrive, it needs a lot more places like Datu Paglas. That would give peace a chance. Clifford is BusinessWeek's Asian regional manager


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