MANILA, Philippines -- For snubbing a subpoena to appear Wednesday at a Senate hearing on the scrapped ZTE deal, Rodolfo Noel Lozada Jr. has been ordered arrested by the blue ribbon committee.

Lozada, 45, president and CEO of state-owned Philippine Forest Corp., was supposed to tell the hearing what he knew about the deal, including how much in bribes went to powerful officials for every signature obtained for the project.

Citing death threats and Malacañang pressure, Lozada flew to Hong Kong Wednesday two hours before the Senate resumed its investigation of the $329-million contract for the National Broadband Network (NBN) project awarded to China’s ZTE Corp.

The blue ribbon committee also ordered the arrest of Romulo Neri, the director general of the National Economic and Development Authority (NEDA) when the government awarded the NBN contract to ZTE last year.

Lozada, a longtime friend of Neri’s, had reportedly served as Neri’s unofficial consultant at NEDA, which allowed him access to the ZTE deal and other big ticket projects of the government.

Jose “Joey” de Venecia III, who blew the whistle on the ZTE deal, said a distraught Lozada came to his house at 10 p.m. on Tuesday telling him about the death threats he and his family had received after it was reported that he would testify at the Senate.

De Venecia, son and namesake of the House Speaker, had gotten to know Lozada after he was assigned by Neri to evaluate his company’s proposal to undertake the NBN project.

Threats

Lozada told De Venecia that he had received texts and phone calls threatening him, his wife and their children. Lozada has five young children.

One message went like: “Alam namin kung saan ka nakatira, kung saan nag-aaral ang mga anak mo (We know where you live and where your kids study).”

Lozada told a friend that he was sent by his superior, Environment Secretary Lito Atienza, to London after he rejected an alleged order to lie at the Senate probe of what he knew about the overpricing and bribery in the NBN project, which sought to build a broadband network linking government agencies and local government units nationwide.

Global fuels conference

But Atienza denied Lozada was ordered to leave the country to prevent him from talking. He said Lozada was attending the “Global Fuels Conference and Exhibition” in London, adding that Lozada filed for a travel authority on the second week of this month.

“He asked permission to attend the conference and later on to meet with stakeholders (on biofuels) and he will be away up to Feb. 7,” Atienza told the Philippine Daily Inquirer, parent company of INQUIRER.net.

At the hearing Wednesday, Sen. Juan Ponce Enrile motioned for the Senate to impose its authority over Lozada and order his arrest upon his return to the country.

“He (Lozada) must stay abroad forever for all I care. As long as the Senate exists, he has no choice until he testifies in the Senate,” said Enrile.

Enrile said the Senate should hear the testimony of Lozada from himself instead of hearing it from other people because the latter would not count as evidence.

Sen. Aquilino Pimentel Jr. concurred with Enrile, saying that the arrest order would force Lozada to show up and reveal what senators believed was his “intimate knowledge” of the ZTE deal.

Sen. Manuel Roxas II said it was about time that the Senate put its foot down on the Arroyo administration’s continued defiance of its summonses.

“We will become an inutile institution if we allow the executive to have its way in our investigations,” he said.
Lozada’s superior, Environment Undersecretary Mary Ann Lucille L. Sering, informed Executive Secretary Eduardo Ermita in a letter dated Jan. 29 that Lozada would not be able to attend the hearing because of his trip to London (she presented a travel authority as evidence of Lozada’s official trip).

Plans to resign

Sen. Panfilo Lacson warned that the arrest warrant could further spook Lozada from coming back to the country.

De Venecia, who also said he also received death threats for exposing the alleged overprice and payoffs that attended the ZTE deal, said he told Lozada that it was the price they had to pay for telling the truth.

He said Lozada told him he was planning to resign his post.

Lacson, who had spoken to Lozada a few times in the past two months about what he knew about the ZTE deal, said Lozada had told him he was just going to Hong Kong.

“He will come back,” the senator said.

‘I can’t talk’

Lozada flew on flight PR 300 to Hong Kong at 8 a.m., taking with him one suitcase.

He told ANC anchor Ricky Carandang, who got wind of his departure and staked out at the airport, that he couldn’t talk about the controversy.

“I can’t. I’m still with the government so I still have to do government work. So I will be back,” he told ANC.

Lacson said Lozada would come back voluntarily, resign from his post and present his testimony to the Senate.

Lacson said it was unfortunate that Lozada flew to Hong Kong because he would have talked about his meeting with Jose Miguel “Mike” Arroyo, husband of President Gloria Macapagal-Arroyo, at the Makati Shangri-La hotel where they talked about the NBN project and ZTE.

Unfair, untrue

Mike Arroyo, who had reportedly spat at Lozada, was also the one who told De Venecia to stop pursuing the NBN project.

Arroyo’s spokesperson, Ruy Rondain, said it was not in the nature of the President’s husband to spit on the face of anyone.

“The allegations are simply unfair, untrue, unfounded. It makes a mockery of the man who has kept all this time, away from the public eye while quietly helping the poor and the needy,” Rondain said in a statement.

Lacson said Lozada was willing to testify for the country. “He would have talked about the overprice which he said he would have accepted had it been pegged at P70 million but when he learned that the padded amount was unconscionable, he told Neri about his misgivings,” he said.

Reconsider

Neri said he was hoping he would not be arrested.

“I’m hoping that they will reconsider,” he told the Inquirer when asked if he would submit to the arrest order.

Neri said he already filed a petition in the Supreme Court against the Senate’s order for him to appear again at its hearings.

Neri filed last Dec. 6 a special civil action for certiorari against the show-cause order issued by the Senate blue ribbon and two other committees investigating the deal.

The high tribunal issued a Jan. 15 resolution asking the Senate committees to comment on Neri’s petition.

At a hearing last year, Neri told the Senate that then Commission on Elections Chair Benjamin Abalos Sr., who was lobbying for ZTE, offered him P200 million to process the proposal of the Chinese firm.

Neri invoked executive privilege and refused to testify on whether the President had asked him to proceed with the NBN project despite knowing that Abalos had offered him P200 million.

Amid the scandal, the President scrapped the ZTE deal.

No special treatment

Lacson claimed that Lozada had backed off because of Malacañang pressure and death threats but Enrile said Lozada should not be given special treatment by the Senate security because it has not been proved that his life was at risk.

Aside from Lozada and Neri, other government executives who were invited but skipped the hearing were Transportation Secretary Leandro Mendoza and his assistant secretaries, Elmer Soneja and Lorenzo Formoso III. Only columnist Jarius Bondoc was present during the hearing.

The other witness, De Venecia, decided not to attend after learning of Lozada’s flight abroad. De Venecia, in his letter to the Senate, called for the “full closure” of the NBN probe to facilitate the completion of the Senate joint committee report and its referral to the proper authorities.

Sen. Alan Peter Cayetano, chair of the blue ribbon committee investigating the scandal jointly with tow other committees, said that while the Senate already had “90 percent” of the information it needed to finalize its report, it would have to wait for Lozada before deciding whether to end the investigation.

Independent panel, please

Mendoza asked the Senate to get an independent panel to review the costing of the supply deal with ZTE Corp.

He expressed confidence that his office had conducted due diligence on the scrapped NBN contract. As a telecommunications project, the proposed NBN is under the supervision of the Department of Transportation and Communications.

Mendoza noted that the Senate had said it would tap an independent panel to evaluate the NBN deal but instead accepted an evaluation report submitted by De Venecia whose company did not get the NBN project.

In the report, De Venecia claimed that the project requirements were overpriced.

Mendoza said the De Venecia evaluation report “should be readily dismissed as a work of propaganda” for evident bias and partiality, errors, lack of verifiable basis, lack of attributable sources of data, lack of sound evaluation methodology, and for arriving at conclusions that contradicted his own submissions in other venues.”

In a statement, ZTE said it was unfair to the company for De Venecia to be allowed by the Senate to convene a panel of industry experts, supposedly to make a financial analysis of its bid proposal.

“This is simply because his position as a rival of ZTE in the aborted Philippine NBN project precludes any objectivity on his part or the conclusion reached by his so-called panel,” the Chinese firm said.

ZTE said it offered the Philippine government the best NBN network for the least amount of money. With reports from Dona Pazzibugan, Leila Salaverria, Norman Bordadora and Riza T. Olchondra