Teves: Gov’t can still rescind national broadband contract

(Updated 4:19 p.m.) Finance Secretary Margarito Teves on Monday said the $329-million broadband deal between the Philippine government and ZTE Corp from China can still be canceled, radio dzBB reported. Teves made the statement during the public hearing of the Senate finance committee, adding that the contract is not yet perfected or formally agreed upon by both parties as it still lacks some necessary documents. He said a loan agreement – one of two key requirements for the completion of a perfect deal in this case – has yet to be signed by the Philippines and ZTE Corp, the report said. The report said that a supplier's contract, the other crucial component for the broadband deal, should be signed by both parties. However, Teves said he has yet to see the supplier's contract, saying he was only informed by his staff that the supplier's contract exists. In a related development, Jose "Joey" de Venecia III, co-founder of losing bidder Amsterdam Holdings Inc. (AHI), said Elections Chair Benjamin Abalos allegedly dropped the names of President Gloria Macapagal Arroyo and House Speaker Jose de Venecia Jr in a meeting with ZTE officials last year. Radio dzBB reported Joey claimed that he personally witnessed how Abalos name-dropped his father, the House speaker, and Mrs Arroyo before the ZTE officials in China last December. Abalos was welcome to file a case in court should he insist on denying allegations that he dangled a $10 million bribe, De Venecia said. De Venecia also alleged that he was offered a $10 million bribe from the poll chairman to give way to ZTE. "I am encouraging him to do so, so our testimonies will be recorded in court. The court's decision would clear the air between us," the young De Venecia said. He also claimed to have been receiving threats to his life. "I have tried to confirm the source of these threats but I am unsuccessful. My father has been so concerned that is why he has been telling me to try to limit my statements to the media about this issue" De Venecia said. The younger De Venecia said Abalos invited him to go with the latter to China as a partner in a broadband project and meet the ZTE officials. He said he could not take Abalos’s statements before the ZTE officials and the alleged plan to bribe government officials connected with the broadband contract. He said Abalos sought the help of his father to be able to have a meeting with the younger De Venecia. He first met Abalos in the house of his father. As this developed, opposition Sen. Panfilo Lacson on Monday said the Philippine may find itself in a bind if it scraps the deal it signed with ZTE Corp. of China. Lacson said that aside from the Philippine government's failure to earmark funds in the national budget for the broadband deal, it needs ZTE's consent to scrap the deal. "That's the bind the government is in. How do you turn your back on a signed contract? And I still don't understand how the DOTC could declare the contract as lost," he said. Lacson also questioned the government's claim it can still scrap the deal, noting that no less than President Arroyo flew all the way to Hainan province to witness it. Even though an agreement on the loan project has yet to be inked, Lacson said the deal was virtually done, signed before no less than the Philippine president. Under such circumstances, he said it is not possible for the Philippine government to turn its back on a deal without the consent of the other party. "The fact is, there's already an agreement between two parties. The agreement as the contract would suggest had been signed by [Transportation and Communications Secretary Leandro] Mendoza representing the Philippine government, and on the other side, the vice president of ZTE ... And if you recall, no less than President Arroyo flew to Hainan to witness the signing ceremony," he said. "The government cannot say it will not push through with the project because it has become too controversial. Now that the President apparently has already issued a directive to review or get the recommendation of the Cabinet to review the contract, it still entails the permission of the other party. The government cannot just say it will scrap the contract because it cannot stand the controversy," he said. - GMANews.TV