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SENATE
Minority Leader Aquilino Pimentel Jr. is pushing for the
early resumption of the Senate inquiry into the
“anomalous” $500-million North Rail Project (NRP) to
ascertain what is really happening with the undertaking
that got mired in a series of controversies.
Pimentel
pointed out that the troubles hounding the NRP can be
traced to the “serious infirmities” in the project
agreement between the Philippines and China, which gave
the Chinese Export-Import Bank (Eximbank) the authority
to choose and designate the contractor for the project
without any public bidding.
“The
North Rail Project is faltering [mainly] because the
Arroyo government awarded the flagship project to a
Chinese contractor despite the absence of public bidding
and noncompliance with other government rules,” he said.
Pimentel
was also dismayed by Trade Secretary Peter Favila’s
revelation that the contractor, China National
Machineries and Equipment Group (CNMEG), was asking the
government an additional $290 million for the first
phase of the NRP—the 32-kilometer stretch from Caloocan
to Malolos—despite the fact that actual construction has
not yet started.
The NRP
is being financed by a $400- million loan from China’s
Export-Import Bank and a $103-million government
counterpart fund.
In a
statement on Monday, Pimentel challenged the Arroyo
government to inform Congress and the public about the
real status of the project in view of conflicting
statements from the Executive branch; at the same time,
he assailed the administration for lack of transparency
when it secured Chinese financing for the railway
project.
He
recalled that shortly after the loan agreement was
signed on February 26, 2004, in Beijing, the Senate had
already expressed misgivings over the project.
He cited
findings by the University of the Philippines (UP)
College of Law that the North Rail deal “suffered from
serious infirmities, and government officials who had a
hand in the deal could be held liable for the mistakes.”
Among
the flaws found by the UP College of Law were that CNMEG
was awarded the project without the benefit of public
bidding in violation of the government procurement law;
a provision in the contract that says that disputes over
the project will be governed by Chinese courts instead
of Philippine courts or courts of neutral countries; and
the Philippine government’s move to relinquish
effective control of the proceeds of the $400-million
loans from China’s Export-Import Bank by allowing the
bank to directly remit payments to the Chinese
contractor without first turning over the money to
Manila.
Pimentel
said the total $1-billion loan from the Chinese Eximbank,
which he said remains practically unused since both the
two phases of the project ($500-million loan each)
remain virtually unimplemented, is being paid at the
rate of P1 million a day by the Philippines.
Former
senator Frank Drilon prodded former Speaker Jose de
Venecia Jr., to “finally spill the beans” on alleged
massive overpricing and kickbacks involved in the North
Rail Project.
“The
reason why former Speaker de Venecia seems to be
reluctant in testifying before the Senate on the NBN-ZTE
scandal is reportedly the threat from Malacañang that he
will be blamed for the massive corruption in the North
Rail Project,” said Drilon. “My advice to Joe de Venecia:
‘Tell the truth, for the truth shall set you free.”
De
Venecia, said Drilon, could be the conscience of the
Arroyo administration, as he had promised when he was
ousted as Speaker, if he rectifies the mischief in the
North Rail deal. “This [exposé of the] North Rail
Project could be the cornerstone and the right track to
take for his much-ballyhooed Moral Recovery Program.”
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