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Palace hits left-leaning Colmenares; calls him ignorant, desperate for media attention

Palace: Colmenares ignorant, desperate for media attention
By Argyll Cyrus Geducos
Malacañang slammed senatorial candidate Neri Colmenares for his supposed ignorance about the “intricacies of finance” after he described a loan agreement between the Philippines and China as “onerous” and “one-sided”.

“It is clear that the matter has been studied at length by our economic managers, particularly the DOF (Department of Finance), unlike Mr. Colmenares who has only shown himself to be ignorant of the intricacies of finance and immature with political pettiness,” said Presidential Spokesperson Salvador Panelo.

Panelo made the statement after the Bayan Muna Chairman said that the loan agreement for the Chico River pump irrigation project was a “disaster for the Philippines.”

“Worse, this P3.6-billion loan may just be one of the many secret loan agreements between the Philippines and China which could run in the billions,” he said.
The project broke ground in June 2018, and was among six bilateral agreements signed in April last year.

In his statement, Panelo said that political and left-leaning opposition should have exercised more prudence and subjected the allegedly controversial agreements to completed staff work before issuing any statement.

“Mr. Colmenares is just desperately seeking media mileage by unduly compartmentalizing the loan agreements of the country without the benefit of context and by maliciously labeling it as a China issue,” Panelo said.

The Palace official also said that they found it pitiful that Colmenares was politicizing the country’s bilateral relations with China in aid of his senatorial bid by uttering financial nonsense.

According to Panelo, the Philippines and China signed a $62.09-million agreement last year to help fund the construction of the Chico River Pump Irrigation Project.

The P4.3-billion project, which is expected to be completed in three years, would supply water to 8,700 hectares of land, benefit 4,350 farmers and their families, and serve 21 barangays in Kalinga and Cagayan provinces.

Panelo said the project has gone through Investment Coordinating Committee (ICC) approval and the loan agreement was reviewed, negotiated, and approved by the Interagency Committee composed of the DOF and the Bangko Sentral ng Pilipinas (BSP).

Based on the report, as part of the terms of agreement, China provided a list of three contractors of good standing and the implementing agency was given the opportunity to vet and request for a replacement if needed.

The Monetary Board also approved the terms of the loan for the Chico River Project before negotiation and after signing of the loan agreement.

Citing the DOF on the concessional interest rate, Panelo said that salient factors were taken into account and not just the nominal rate, to include the project cost, denomination of loan, and foreign exchange depreciation risk, among others.

Panelo also added that with regards the interest rate, the government’s Chinese loans are fixed and not subject to change over time. He also said that project debt to China was but a fraction of the country’s project debt to Japan.

“For each loan agreement, the DOF mentions that an arbitration clause is negotiated. We negotiate to make sure that the arbitration mechanism protects our interests,” he said.

“By 2022, project debt to China is estimated to be at around 4.5 percent of the total debt, while that of Japan will be at around 9.5 percent,” he added.

Palace hits left-leaning Colmenares; calls him ignorant, desperate for media attention Palace hits left-leaning Colmenares; calls him ignorant, desperate for media attention Reviewed by AsianPolicy.Press on 7:47:00 PM Rating: 5

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