MANILA, Philippines — Makabayan senatorial candidate Neri Colmenares is planning to question before the Supreme Court the $248 million (P12.2-billion) China-funded New Centennial Water Source-Kaliwa Dam loan deal, which he said has “onerous conditions” that are “detrimental to the Filipino people.”
“The Preferential Buyer’s Credit Loan Agreement between the MWSS (Metropolitan Waterworks and Sewerage System) and China pertaining to the Kaliwa Dam Project is as onerous as the exposed Chico Dam Loan Agreement,” the Bayan Muna chairman said in a statement.
“Ang nagdidikta ng mga kondisyon ay ang China mula sa interest rate, contractor, trabahador, pagpirma ng DOJ secretary na legal ang loan maski di pa nya naaaral, batas ng China ang susundin sa loan, bawal ipaalam sa publiko ang mga terms ng loan, at kapag di nakabayad ng utang ay parte ng bansa natin ang magiging kapalit,” he added.
(China dictates the conditions — from the interest rate to the contractor to the workers and even the signature of the DOJ secretary to prove that the loan is legal. The laws of China will also be followed and the terms of the loan cannot be disclosed to the public. In case of loan default, part of the payment will be our country)
The Department of Finance has published on its website the loan agreements of the nine infrastructure flagship projects funded through Official Development Assistance (ODA).
These projects are the Chico River Pump Irrigation Project, Kaliwa Dam, Pasig-Marikina River Channel Improvement, Cavite Industrial Area Flood Risk Management, Metro Manila Subway Project-Phase I, North-South Commuter Railway Extension Project, Panguil Bay Bridge Project, New Cebu International Container Port, and Metro Manila BRT – Line 1 (Quezon Avenue).
With the release of the official copies, Colmenares said he “plans to file a petition in the Supreme Court to question the said contracts.”
He also exposed a leaked copy of the Chico River irrigation loan contract two weeks ago.
READ: Ex-lawmaker raises alarm over onerous’ China loan
Colmenares, a lawyer, said the government already “pre-selected” the contractor who would implement the Kaliwa Dam project, which is Chinese contractor China Energy Engineering Corporation Limited.
The former Bayan Muna representative said this was a “violation of our procurement laws, as well as a violation of the Constitution that mandates a preference for Filipino contractors and workers who are equally, if not more than qualified.”
Under Article 8.4 and 8.5 of the agreement, the governing law between the parties would be the laws of China, and the venue for the settling of disputes would be the Hong Kong International Arbitration Centre (HKIAC).
Screenshot from the loan agreement
This provision, Colmenares warned, already “puts in jeopardy the country’s chances in getting any favorable or fair outcome in any future dispute considering that the legal and technical advantages are already stacked in favor of China.”
The Philippine government further provided waivers in favor of China under Article 5.7 of the loan agreement.
Screenshot from the loan agreement
This provision “would allow China, following their win in an arbitration conducted in Hong Kong using China laws, to take over Philippine government properties,” according to Colmenares.
MWSS Administrator Reynaldo Velasco has said the Kaliwa Dam was already a “done deal,” as its construction may begin in July or August this year.
READ: MWSS: China-funded Kaliwa Dam’s construction may start July or August
Velasco also claimed that the project would be cheaper compared to a Japanese firm’s proposal.
READ: MWSS: China-funded Kaliwa Dam cheaper than Japan-proposed project
The Kaliwa Dam is one of MWSS’ long-term solutions to the water shortage that parts of Metro Manila have experienced since March 6. The dam, which is part of the Duterte administration’s two-phase New Centennial Water Source, is expected to supply 600 million liters per day (MLD) of water.
IN THE KNOW: The New Centennial Water Source Project
The Commission on Human Rights, as well as various environmental groups, has warned that the construction of the dam would displace indigenous communities in Rizal and Quezon provinces. /ee
READ: CHR: Mind people’s rights in Kaliwa Dam project
READ: Kaliwa Dam Project Loan Agreement