Advertisement

Lender bender

"Did the administration give the store away to the Chinese lenders in Chico River?"

 

Over the week-end, Senior Associate Justice Tony Carpio and Senior Columnist Scold Winnie Monsod ganged up on the administration for allegedly selling out the country’s patrimony to Chinese lenders.

To hear Carpio tell it, the Chinese can seize the country’s patrimonial as well as commercial assets anytime—including the oil and gas reserves under the Reed Bank—in order to satisfy an arbitral ruling in their favor.

As evidence, he pointed to the newly signed Chico River project loan agreement, under which he claimed that any arbitration must be held in Beijing, any court cases have to be brought in China, and the governing law will be Chinese. It’s a dire, dire situation that Monsod dolefully described as “lutong macao—pun very much intended.”

As usual, with these guys, it’s a good idea to check the facts and the precedents for ourselves. What’s really going on?

* * *

Here’s the response from the boys at the Department of Finance:

Collateral is not mentioned in any of the country’s loan agreements, including the one for Chico River.

Instead, what’s provided for is an “arbitration clause” under which the Philippines, as borrower, agrees to participate in arbitration to settle any differences with China as lender.

In order to participate in arbitration, the Philippines has to waive its sovereign immunity “in connection with the arbitration or the enforcement of any arbitral award”, though NOT in connection with “any Philippine assets which are neither patrimonial nor commercial in nature”.

Note that our government has to affirmatively declare that a given asset is in fact patrimonial before it can be covered by arbitration. To his credit, Carpio unearthed a 1972 law declaring the Reed Bank to be, indeed, patrimonial. But let’s see below what other hoops the Chinese or any other lenders still have to jump through.

Whatever might happen, an arbitral award would still need to go through a Philippine court for validation before it can be enforced against us. The court will want to see that the arbitration was fair, there was no collusion, and the award is consistent with the country’s public policy.

* * *

So did the administration give the store away to the Chinese lenders in Chico River? Let’s do an actual comparison of the Chico River agreement with one from Japan (for the North-South commuter line) and Korea (new Cebu international container port), all three under Duterte; a fourth agreement with France (Cebu bus rapid transit-BRT) under Aquino; and another Chinese one (Angat dam) under Arroyo.

On choice of governing law: All five agreements are governed by the law of the lending country. This is a standard provision and will not surprise those familiar with such loan agreements.

On arbitration venue: Four agreements provide that arbitration will take place in the lending country (the fifth, with Korea, was either different or silent)

On immunity waiver: The Chico River agreement with China under Duterte and the Cebu BRT agreement with France under Aquino contain virtually identical language about waiving immunity only for arbitration purposes and maintaining immunity for our assets except those which are commercial or patrimonial.

It seems evident that what really galls many of us about these new Chinese loans is not the language in the agreements—which is fairly standard—but the plain fact that these are the same guys who’re happy to harass our fishermen as they go about building up their island-based defenses against the US 7th Fleet and its submarines.

As ever, the less emotion is involved, the better for us. We are neither as strong as Vietnam nor as far-away as Indonesia if it comes to an open clash. Better to stay pacific and build up our business and people-to-people ties with them while we get our military act together. And one good place to start with the latter is reviving ROTC—although, predictably, that’s being opposed by the same leftists who like to pillory Duterte for “selling us out” to China.

* * *

At last the European Union will investigate if the millions of dollars it has been sending to local NGO’s over decades have in fact found their way to the CPP-NPA, an organization that the EU (and the US) have both declared to be terrorist in nature.

The tie-up between violent guerrillas and leftist elements of civil society has got to be one of the country’s worst-kept secrets. If every leftist NGO that’s denied any ties to the NDF legal front of the communists were telling the truth, there wouldn’t be any NDF at all.

And yet, sadly enough, one generation after another of young idealists swallows the lie, hook line and sinker. Every year these kids provide fresh fodder for the delusions of the ageing malefactors who’re trapped in Utrecht by the alluring comfort of their petty-bourgeoiserie.

Come to think of it, why stop with EU funds?

There’s every reason to extend the probe and look into what the NDF front that calls itself the “Makabayan bloc” of legislators is doing with the public funds they get from Congress. How much of that money ends up with their NPA colleagues—together with confidential information on natural security that may routinely cross their desks?

* * *

Today’s Readings:

Water is an important theme in today’s readings. In Ezekiel 47: 1-9, the exiled prophet shares his visions of a stream flowing from under the Temple in Jerusalem that will bring the Lord’s abundant blessings to his fellow Judahites in Babylonian exile.

In the Gospel (John 5: 1-16), Jesus encounters a sick man lying beside the Bethesda healing pool, also in Jerusalem, who was not healed for thirty-eight years because no one would help him into the pool whenever the underwater spring bubbled up. But Jesus doesn’t need to lead him there. He simply tells the man to take up his mat and walk, and the healing miracle happens.

Jesus is the miraculous water who brings, not only God’s blessings, but also the manifest Divine presence into our lives. All He asks in return—as he did of the man in Bethesda—is for us to turn away from sin.

Readers can write me at [email protected]

Topics: Tony Carpio , Department of Finance , Winnie Monsod , Chico River , Reed Bank
COMMENT DISCLAIMER: Reader comments posted on this Web site are not in any way endorsed by Manila Standard. Comments are views by manilastandard.net readers who exercise their right to free expression and they do not necessarily represent or reflect the position or viewpoint of manilastandard.net. While reserving this publication’s right to delete comments that are deemed offensive, indecent or inconsistent with Manila Standard editorial standards, Manila Standard may not be held liable for any false information posted by readers in this comments section.
AdvertisementGMA-Working Pillars of the House
Advertisement