MWSS: China-funded Kaliwa Dam cheaper than Japan-proposed project

MANILA, Philippines – The administrator of the Metropolitan Waterworks and Sewerage System (MWSS) belied Wednesday claims of a Japanese firm that the China-funded Kaliwa Dam project would be more costly for the government than their proposal.

“Hindi po ‘yan $800 million. Hindi po totoo ‘yung sinasabi na masyadong mahal ang Kaliwa Dam,” MWSS Administrator Reynaldo Velasco said in a briefing in Malacañang.

Japan-based infrastructure firm Global Utility Development Corporation (GUDC) on Tuesday said their proposed Kaliwa Intake Weir project would be cheaper at $410 million.

Velasco, however, said Kaliwa Dam project would cost only $248 million, cheaper than the proposal of GUDC.

“The actual [cost], because it has been bidded out already, is $248 million or P12.2 billion,” he said.

Dam vs Weir

Despite GUDC saying that a weir is “cheaper” and “more environmental friendly” than the Kaliwa Dam,  Finance Undersecretary Tony Labino said a weir is a low type of dam that does not have the ability to store water.

“Ang ‘weir’ o isang uri ng mababang dam ay umaasa sa agos ng ilog; kapag walang agos, ‘pag may drought, wala rin pong tubig mula sa isang weir,” he said.

“Nananatiling matibay ang paniniwala ng gobyerno sa kanilang desisyon noon pang 2013 na ang pagtatayo ng dam ang tamang solusyon para matugunan ang kakulangan natin sa tubig sa mga susunod na taon,” he added.

Why ODA?

Lambino also addressed criticisms on why the government opted the Kaliwa Dam to be funded by China through a loan — via official development assistance (ODA) — and not through public-private partnership (PPP).

“Iyong financing terms na nakuha po natin for our ODA projects ay 2% which is something that cannot be matched even by multilateral development banks at pati po ang private capital markets,” he said.

The finance official cited that while the government would not release funds for the PPP, he said private companies might pass the cost of the project to consumers.

“Patungkol sa mga paratang na ang solicited PPP ay walang gastos para sa pamahalaan, mariin naming ipinababatid sa publiko na kahit walang gastos para sa pamahalaan ay hindi ibig sabihin walang gastos para sa customer. Ang mas mataas na project at financing costs sa ilalim ng solicited PPP ay magiging dagdag pasanin para sa mga consumers,” he said.

He also allayed fears that the Philippines might fall into a debt-trap with China and said the agreement did not entail any collateral.

“Wala po tayong isinamang collateral. No collateral was declared. Pangalawa, mayroon po tayong clause in our loan agreements with China called ‘pari passu’. It’s a legal language that means all our creditor countries have an equal claim based on a pro-rated sharing of how much we owe them,” he said.

“So, actually, we cannot owe one country more than the other. Iyon po iyong kasama po doon sa mga loan agreements. Maingat na maingat po ang pag-negotiate niyan,” he added. /kga