Gov't snubbed 'free' broadband network pushed by DOST

The Department of Science and Technology proposed a “free" broadband network but the government opted for a $329-million (P15 billion) project to be funded by a loan from China. Science and Technology Secretary Estrella Alabastro told the House of Representatives appropriations committee that the DOST had proposed a similar broadband project to funded by official development assistance (ODA) or foreign aid. She also informed the panel deliberating the DOST’s P5.28 billion budget that that the agency was never consulted on the project. Alabastro and DOST director Dennis Llorente said they had been pushing since 2001 for an NBN project to link the DOST, other government agencies, and international agencies in the country. She said the DOST continued with their version of the NBN project by making use of their limited budget to interconnect with the country’s top telecommunication companies. At present, the DOST broadband network links 80 agencies. Chinese firm ZTE will undertake the $329-million national broadbank network (NBN) project. The Export-Import Bank of China will provide a loan that comes a 3 percent annual interest and is payable over 15 years, with a grace period of five years. The government insists the deal is an executive agreement and therefore does not require a bidding. Alabastro told House Deputy Minority Leader Roilo Golez that no official sought the DOST’s opinion on the ZTE deal even if the government knows that it falls within the agency’s expertise. The science and technology secretary also informed the appropriations committee headed by Albay Rep. Edcel Lagman that the DOST requested for funding – to be sourced from the Official Development Assistance (ODA) fund – but this was not acted upon by the National Economic and Development Authority, which approves such projects. Amsterdam Holdings Inc. (AHI), a losing proponent, also countered ZTE’s claim that their rival offer of a build-operate-transfer (BOT) project worth $240 million would actually cost $60 million more than the Chinese firm’s interest payments. “ZTE misses the point entirely. ZTE's proposal will require the Philippine government to obtain a US$330 million loan from the Chinese government at an interest rate of three percent per annum, payable in 15 years with a grace period of five years," AHI said. AHI was co-founded by Jose de Venecia III, the son of Speaker Jose de Venecia. “The Philippine government will not have to pay a single cent towards the US$240 million project cost of AHI. AHI will construct, operate, and maintain the NBN at no cost to government," the company said in a statement. -GMANews.TV