Lorenzana says he signed deal to let China-backed Dito telco build cell sites in military camps

MANILA, Philippines—Defense Secretary Delfin Lorenzana said on Tuesday (Sept.8) that he has signed a deal with China-backed Dito Telecommunity Corp., which would allow the telco to build cell sites inside Philippine military camps.

“I signed the contract recently,” he told lawmakers at a budget hearing at the House of Representatives.

The defense chief deferred the signing of the contract with the telco in 2019 after opposition senators asked for a copy of the agreement so they can review it.

“When the contract reached my table, Senate asked a copy of the contract for them to scrutinize,” Lorenzana said in response to Cagayan de Oro Rep. Rufus Rodriguez’s request for an update on the controversial deal.

Lorenzana said he was given an assurance by the Armed Forces of the Philippines that the military will  “institute safeguards so that the security of our camps will be maintained.”

Rodriguez expressed concern that the employees of Dito could be spying for China.

“Can you imagine that there will be Chinese employees of Dito, who may be spies for China while we have a conflict especially in the West Philippine Sea, entering our camps,” Rodriguez said.

Lorenzana said that Dito would be allowed only in camps where network providers Globe and Smart have cell site towers.

“I think this is just fair for Dito because they will be just providing signals or telco services in the provinces…They also want to be inside camps for security and protection,” he said.

The entry of the third telco player in the country was envisioned to break the duopoly enjoyed by PLDT-Smart and Globe.

Dito Telecommunity, formerly known as Mislatel, is a consortium led by Davao-based businessman Dennis Uy, which included Chelsea Logistics and Infrastructure Holdings Corp., Udenna Corp. and China Telecom.

The state-owned China Telecom owns 40 percent of Dito Telco.

Some government officials and security analysts have earlier raised concerns over the Chinese stake in the consortium, amid Beijing’s use of cyber surveillance in other countries.

Chinese state-owned firms are obliged under Beijing laws to follow orders, like divert or intercept internet traffic, or access state secrets, when required.

Several countries, including Australia, United States, Japan, Taiwan, and New Zealand, have banned or reconsidered business deals with China’s largest telco and phone manufacturer Huawei Technologies due to suspicions of potential Chinese state espionage.

A security official earlier warned that the Philippines has weak cyber defense systems and is not ready for complex challenges.

He said existing similar arrangements of the AFP with Smart and Globe should not serve as a basis to let the agreement with Dito push through easily, pointing out that the two telcos are not linked with China.

TSB