By Elijah Joseph C. Tubayan, October 10 2018; Business World


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THE DEPARTMENT of Finance (DoF) said that Chinese loans and grants were not employed as leverage to arrive at a joint energy exploration agreement in the South China Sea.

The DoF disputed the claim after an online media outlet reported, without citing a source, that Chinese ambassador to the Philippines Zhao Jianhua hindered the delivery of official development assistance (ODA) to force the Philippines to agree to joint exploration.

“The topic of joint (oil) exploration was never raised in our discussions with our counterparts particularly during loan negotiations and processing of new loans, even during the bilateral meetings/high-level meetings with this office,” the DoF said in a statement on Wednesday.

“This is a grossly malicious claim without any basis. There is no link whatsoever between the Chinese loans and grants and the proposed joint oil exploration deal between the two countries,” it added.

The Chinese embassy has yet to reply to queries at deadline time.

The Finance department said that meetings both here and in China only involved negotiations on the funding for infrastructure projects under the government’s “Build, Build, Build” program, and that the delay was “mostly due to (the Philippine government’s) internal processes.”

“In fact, the proposed infrastructure projects we are undertaking with the cooperation of China all go through a very stringent process of approvals to ensure that they comply with the Government Procurement Act and other applicable laws,” the DoF said.

Foreign Affairs Secretary Alan Peter S. Cayetano said last week that he is “trying to rush” the framework for a 60-40 joint exploration between Manila and Beijing, in favor of the former.

Economic managers and their Chinese counterparts last met in August in Beijing, where they discussed an indicative list of 12 infrastructure projects proposed for feasibility study assistance. Both parties meet every quarter to firm up partnership agreements and streamline the process.

The Philippines has so far signed with China grant agreements supporting the Estrella-Pantaleon and Binondo-Intramuros bridges across Pasig river, the acquisition of radio and broadcasting equipment, the Philippine-Sino Center for Agricultural Technology-Technical Cooperation Program Phase 3, as well as feasibility studies for the Davao City Expressway Project and the Panay-Guimaras-Negros Island Bridge.

In terms of loan agreements, the Philippines and China have only signed one covering the P2.69-billion Chico River Pump Irrigation Project.

Chinese President Xi Jinping is expected to visit the Philippines next month to sign more loan deals, kicking off the start of project implementation.

Projects covered by the expected loan signings include the New Centennial Water Source-Kaliwa Dam project; financing for a project management consultant for the Philippine National Railways South Long-Haul project; and the Safe Philippines project, Phase 1, according to the DoF.

Other projects lined up for China funding include the Davao-Samal Bridge construction project, the Ambal-Simuay River and Rio Grande de Mindanao River Flood Control projects, the Pasig-Marikina River and Manggahan Floodway Bridges project, the Subic-Clark Railway, and the rehabilitation of the Agus-Pulangi hydroelectric power plants.

Mr. Duterte obtained $9-billion worth of ODA commitments from China in late 2016. — Elijah Joseph C. Tubayan