Why does Duterte admin prefer China loans despite higher rates? Alejano gives reason

Opposition lawmaker Magdalo party-list Representative Gary Alejano on Saturday said the reason why the Duterte administration prefers loans from China despite having higher interest rates is that they have less stringent requirements.

"The issue really there is that hindi ganun ka stringent ang requirement ng loans sa China. Hindi ka required to observe, respect to human rights, hindi ka naman nire-require na may due process of law in respect to democracy, or even a comprehensive feasibility study," Alejano said in a news forum in Quezon City.

"'Yun ang nature ng loans sa China basta bayaran niyo kami... Parang nangungutang ka sa Bumbay. Dito ka kukuha dahil mabilis ang loans kahit mataas ang interes," the lawmaker said.

The opposition solon said interest rates from Chinese loans can go as high as 3 percent to 7 percent compared to Japan's 0.25 percent to 0.75 percent.

Socioeconomic Planning Secretary Ernesto Pernia earlier said that Japan is slow in processing projects that's why the government prefers loans from China.

Despite the administration's preference of Chinese loans so far, Alejano said that only one agreement was signed between the Philippines and China.

Under an agreement signed between the Department of Finance and Export-Import Bank of China in 2017, China would provide soft loans estimated at $234.91 million for the Kaliwa Dam-New Centennial Water Source of the Metropolitan Waterworks and Sewerage System, and $72.49 million for the Chico River Pump Irrigation Facility of the National Irrigation Administration. 

Because China pledged $24 billion in investments and loans, the Duterte administration is compelled to be less defensive on China's aggression in the West Philippine Sea, according to Alejano.

"Mataas ang promises o pledges but the delivery is slow, so for the meantime, nahahawakan ka niya. Hindi ka pwede papalag dahil naghihintay ka nga na pahiramin ka so nagiging tahimik ka muna, wala kang ginagawa," the lawmaker said.

With this, Alejano said he filed a resolution calling on the Duterte administration to be transparent with the conditions for financing deals it entered with the Chinese government.

"Kasi ang loans sa China is very secretive, hindi transparent so magugulat na lang... Magugulat na lang after ang bansa na meron na pa lang loans na ganito," he said.

"In fact, sumulat na ako sa NEDA (National Economic and Development Authority) tinatanong natin kung ano 'yung mga loan agreements na nakasalang or napirmahan kasi wala pa tayog nakikita," he added. —KG, GMA News