Diokno warns vs. banning China-owned firms in gov’t infra projects

Finance Secretary Benjamin Diokno on Wednesday warned against banning China-owned corporations from participating in government’s big-ticket infrastructure projects.

The country’s top economic manager cited several negative implications amid Senate President Juan Miguel Zubiri’s proposal to ban Chinese government-owned companies considering the “bullying” of Filipinos in the West Philippine Sea (WPS).

“It makes no sense for us to give billions of pesos to a Chinese contractor, state-owned, who will bring the profits back to China and that profit, because it’s state-owned, will go back to fund their different activities in the West Philippine Sea. Parang niluluto natin ang ating sarili sa sariling mantika, ika nga,” Zubiri said.

In response, Diokno said there might be effects in the financing and the implementation of the government’s infrastructure projects should the Philippines ban China-owned firms.

“In case [a] decision is made to ban Chinese contractors from participating in pipeline projects of the national government, it may have the following potential effects. For example, implementation of Official Development Assistance (ODA) projects from bilateral and multilateral ODA partners alike, particularly for projects considering multiple country participation including China as a member the ADB, Asian Infrastructure Investment Bank and the World Bank, so that might affect the implementation of those projects,” Diokno said.

“Procurement of locally-funded projects and even [Public-Private Partnership] implementation, if the main contractors, suppliers, or subcontractors would be Chinese firms or Chinese nationals, potential impact on the economy for possible delays in the projects that will be affected and of course, we have to shift to the financing for those projects that have been requested from China,” he added.

With the long list of pursued infrastructure projects, Diokno said it might also affect the sourcing of workers.

“We’re running out of workers in the Philippines, your honor, I think you’ll agree with me. We’re running out of workers, also the private sector workers. And we need foreign workers, maybe Indian workers, Chinese workers…especially in renewable energy and power projects,” he said.

But Zubiri insisted the need to stand up for the WPS, saying the Philippines can tap other countries to help in the implementation of the infrastructure projects.

“I think we all have to stand up for what’s happening in the West Philippine Sea. You have to make a policy decision… We also have to stand up for our troops in the WPS, they should not be allowed to be bullied. I think we all agree to that,” he said.

“Masyado tayong bilib sa China. We can always get South Korean contractors. We can always get Japanese contractors, we can get Vietnamese contractors. They make big fantastic infrastructure. We can also get supplies from India,” he added.

The Senate president bolstered his argument by citing the “failed” infrastructure contracts that the Philippines had entered into with China.

“You know, secretary, kausap ko si [Transportation] Secretary [Jaime] Bautista. Ang sabi niya sa akin palpak lahat ng Chinese contracts. Hindi natuloy. [The North-South Commuter Railway], they abandoned it. All these contracts that were made in the previous administration are abandoned. Correct? You’re nodding your head, yes,” Zubiri said.

Senate Deputy Minority Leader Risa Hontiveros also refuted Diokno by citing NEDA statistics in June 2018 which showed that of the estimated $13 billion ODA received by the Philippines, China only accounts for 0.8%.

While Diokno said the statistics cited were correct, the Finance chief explained that if a project is financed by multilateral institutions like ADB, any member country can compete in the project bidding like China.

Still, Zubiri said the track record of China showed that it failed in finishing the infrastructure projects of the Philippine government.

“It can be a policy shift when it comes to that because the track record shows na palpak ang projects ng China dito sa ating bansa. They were supposed to do the Clark. What happened to them? Gone with the wind. They were supposed to do the rail on the way to Bicol. Gone with the wind. They were supposed to do the Mindanao rail, ang ganda ganda. Gone with the wind. It’s now in the West Philippine Sea,” he said.

“My point is, let us deal with, I think, reputable and reliable, friendly partners with like-minded ideals and I think that would be a better option for our country,” he added.

Zubiri went on and said with the presence of more Chinese nationals in the Philippines amid the situation in the WPS, the government must have a “nationalist stand” on the country’s sovereignty.—AOL, GMA Integrated News