Zamboanga ecozone a P50M white elephant, says COA

/ 11:23 PM June 09, 2011

AT LEAST P50 million in public funds had been misused, and wasted at the Zamboanga City Special Economic Zone Authority, the Commission on Audit (COA) said in a report.

The money was reportedly  spent on a condotel, an artificial ocean, and presidential chateau, all of which are now unused, and said to be deteriorating, said COA.


COA, in its 2010 report, also said that after 15 years, the economic zone has not achieved its goals and objectives.

Economic zone officials told COA there was no waste of funds as plans are in place to make full use of the facilities, including the condotel. Other facilities have not been completed because of lack of funds, the officials said.


COA found that the economic zone built a two-story condotel worth P25.42 million that was completed in June 2009. It was designed to house retirees and visiting investors.


Two years after it was built, however, the condotel is still unoccupied and unable to generate income. Its value continues to depreciate, COA said.

“There is a zero rate on return … clearly showing wastage of government resources,” it said.

COA also said other facilities, equipment and structures in the economic zone worth P24.897 million are lying idle and unable to generate income, too.

These facilities include a P2.829 million artificial ocean, a P2.458 million presidential chateau, and a P15.126 million waste water treatment and collection center.

The chateau has not been completed and has been cannibalized, while the other facilities are becoming dilapidated, the audit agency said.


“It appears that the (economic zone) authority was not able to meet the set objectives of being an economically viable free port,” said COA.

Economic zone authority officials said structures and projects in the free port have not been completed because of lack of funds.

COA, however, said the economic zone should have been more careful in handling public funds.

COA said as of Dec. 31, 2010, the authority’s total investments reached P792.8 million. It has six registered business operators and 22 leisure farm operators.


But it has also been losing money. In the last five years, its average yearly loss was P28.2 million over a P30 million per year subsidy from the government. Its average yearly income from its operations was only P4.5 million.

The poor performance was attributed to the absence of a port facility, lack of feasibility studies on infrastructure development, poor marketing strategies and lack of public acceptance.

The authority said it has been unable to meet its objectives because of its limited funding, lack of transportation, telecommunications and other facilities.

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