P-Noy: No ZTE-type deal under my watch

MANILA, Philippines - There is no way taxpayers will be asked to spend $329 million for a national broadband network (NBN), just as the previous Arroyo administration had tried to do with ZTE Corp. of China, President Aquino said yesterday.

“Reviving something similar to the ZTE deal, no way. But utilizing what we do already have to meet the needs, that is currently being assessed, and the plan is being drawn up by DOST (Department of Science and Technology),” Aquino told Palace reporters.

He said the DOST, headed by Secretary Mario Montejo, is in the process of making an inventory of the resources that might come in handy in case the administration’s NBN plans push through.

“Now, if there is need to engage the telcos (telecommunications companies), which was my position, they are ready as far as broadband is concerned,” Aquino said.

The President said the DOST has “coincidentally” reported the flaws of the ZTE project. He said the project “would have already been obsolete by the time it would have been set up.”

Meanwhile, Senators Francis Escudero and Alan Peter Cayetano asked the President yesterday to exercise caution regarding proposals to revive the NBN project.

Escudero admitted that he was surprised by fresh moves to resurrect the NBN project. 

Escudero said the Senate had thoroughly investigated the anomalous NBN deal with ZTE Corp. and that then senator and now Transportation Secretary Manuel Roxas II had been one of the fiercest critics of the deal. The Blue Ribbon committee, which investigated the issue, was then chaired by Sen. Joker Arroyo.

Escudero said even then Senator Aquino was at the forefront of the campaign against the NBN deal along with Senators Panfilo Lacson and Alan Cayetano.

“One of our main points then was that this was already being done by telcos, so why involve the government in this? It’s going to be just a duplication of existing facilities,” Escudero said in Filipino.

Cayetano argued that technologies change rapidly and that an NBN system being envisioned might become obsolete before its completion.

“This becomes obsolete, and government just loses money. Why compete with the private sector?” Cayetano said.

Escudero also said the government might not be capable of sustaining the upkeep and maintenance of NBN facilities.

Inexpensive but reliable

Earlier, Secretary Ricky Carandang of the Presidential Communications Strategic Planning and Development Office confirmed the administration’s plan for a more inexpensive but reliable broadband network.

“It was brought up that there might be a need for a government network which would help save communication costs... That was discussed in broad strokes, and there has been no discussion lately on that,” he told Palace reporters last week.

Montejo, for his part, has proposed P800 million in funding for the project.

“We are finishing our current studies before submitting it to President Aquino. Maybe in one month, we will give him the study,” he said.

Montejo said existing government assets such as fiber optic cables may be used for the connectivity project. He added the project could first interconnect government offices in Metro Manila before going nationwide.

He acknowledged that while a broadband project “has a bad image, the need to improve government services is more imperative, more important.”

The Arroyo administration had to cancel its NBN deal with ZTE Corp. amid public outrage over huge kickbacks allegedly received by former first gentleman Jose Miguel Arroyo and some of Arroyo’s officials from the Chinese firm.

However, not a single individual has been charged for the alleged anomalous deal, which had been a subject of Senate investigation. 

Then Transportation and Communications Secretary Leandro Mendoza signed the deal for the Philippine government with ZTE vice president Yu Yong in April 2007 in Hainan, China, with then President Gloria Macapagal-Arroyo as witness. With the project withdrawn, the Supreme Court dismissed all petitions contesting its constitutionality.

The NBN issue took a dramatic twist in February 2008 when then Philippine Forest Corp. president Rodolfo Lozada Jr., upon his arrival in Manila from Hong Kong to appear before a Senate inquiry, was taken “out of town” by a group of men who later turned out to be airport security personnel led by Angel Atutubo. He was eventually brought to La Salle Greenhills, where he held a pre-dawn press conference and detailed his kidnapping.

Lozada was also a consultant to the National Economic and Development Authority, one of whose tasks was to endorse infrastructure projects. It was then headed by his friend Romulo Neri.

A tearful Lozada would later narrate his ordeal before a Senate committee hearing on the NBN deal. In his Senate appearance, Lozada linked then first gentleman Arroyo as well as elections chief Benjamin Abalos - who has since retired - to the NBN anomaly.

Neri himself accused Abalos of attempting to bribe him with P200 million to make him endorse the NBN deal. He said he reported the bribery attempt to Mrs. Arroyo but refused to reveal details of their conversation. He said Mrs. Arroyo merely asked him to reject the bribe.

As a result of the NBN controversy, Mrs. Arroyo had a falling out with then Speaker Jose de Venecia Jr., whose son and namesake implicated her husband. The younger De Venecia related to the Senate how Mr. Arroyo barked at him to “back off” from the NBN issue. - With Christina Mendez