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July 3, 1942

Today I shall delve into the confused structure of the industrial sector. Most business establishments were either voluntarily closed or sealed, while those that are still operating are under Japanese control, because in the first place, all industries capitalized wholly or partly by enemy countries have automatically passed on to Japanese hands. Among these are the mining firms and some sugar centrals, the Meralco, and many small factories in Manila and the provinces.

Our gold mines which are the riches in the world are now inactive, with no known plans for them. As for other metals like iron, chromium and manganese, they are still waiting for experts from Japan to arrive and set up mining establishments.

Sugar centrals have started operations since the end of January, under Japanese management. Even the factories which were subsidized only partially by American capital had been confiscated by the Japanese army. The plantation and sugar central in Canlubang was a case in point. It was purchased by Madrigal from an American firm before the war of ₱5,000,000.00. The Japanese took possession of it, promising to pay him back. In this case, the Japanese showed a little respect and consideration. In others there was none.

Almost all the sugar centrals, whether owned by Filipinos or Spaniards, are operating as usual. Some were allowed to sell sugar during the disposal of their sugar, with the price fixed at ₱5.00 a picul. The price in the market was ₱20.00 or more, and it is hard to determine who has the upperhand in this transaction. Meanwhile, molasses, which used to command an excellent price, is now being commandeered by the Army for use in the manufacture of alcohol.

Meralco, and other owned companies by the Americans, British or Chinese have passed on as spoils to the victors, although most of the people working in these firms were retained.

In this connection, the following notice to the public appeared in yesterday’s papers:

The undersigned company takes the pleasure of announcing that by the expressed order of the Japanese Military Administration, the operations and management of the public electric utilities of the Philippine Islands have been assigned to it, and that operations under our administration will commence on July 1, 1942.

The Taiwan Power Company

As the notice did not exclude electric power plants owned by Filipino establishments, the new Japanese firm has taken over all existing light factories, whether owned by enemy nationals or not.

On the other hand, Filipino, Spanish and German industries, except for isolated cases, are allowed to operate, with many reservations.

Of the four major cigar and cigarette factories in operation, three are Spanish and one is Swiss-German. They can produce all the cigars and cigarettes they want, with Philippine tobacco which is abundant. The prices, however, are prohibitive, due to the manipulations of middlemen. The military commandeers all the big warehouses of imported cigarettes. Likewise, the Army has “bought” from Virginia tobacco all the cigarettes made in Manila. In the beginning, they allowed the sale of some of these imported brands. Gradually, the Army exhausted the supply and prohibited their sales.

Furthermore, the Army purchases all alcohol produced by the different distilleries, exporting it to Japan, or selling it on ration to those who have the permit to use motor vehicles.

The manufacturers of “Rizal” cement were ordered to produce at full capacity, and the products are being bought by the Army. As of date, they have been paid only with receipts and IOU’s.


San Miguel Brewery was one of the most flourishing economic establishments in Manila. Its products are ice, softdrinks, Magnolia milk, ice cream and beer. Before the war, San Miguel produced some one hundred thousand bottles of Coca Cola and beer daily. All of them were sold. Ninety-five per cent of the operations were under Filipinos or Spaniards. Aside from a few Spanish employees and three or four German technicians, the personnel force was composed of Filipinos. The firm has been taken over by Japan, perhaps because the local Japanese beer factory could not compete with San Miguel, or perhaps because the Japanese needed the products of San Miguel. The fact is that just at the start of the war the Japanese Army took over all the plants of San Miguel and produced just enough for the Japanese Army.

Due to the lack of raw materials, San Miguel could not manufacture bottles. The Army had to resort to all kinds of tricks to insure the supply of bottles. First, they announced that beer was going to be sold to the public but those who wanted to buy it would had to turn in seventy-two empty bottles before they could be entitled to buy a case of twenty-four bottles. The Chinese went around buying empty bottles which they sold at seven or ten centavos per bottle. Once refilled, a bottle of beer cost from fifty to sixty centavos.