GMA signed, not just witnessed, NBN-ZTE

“I did not clear Gloria Macapagal Arroyo of the NBN-ZTE scam,” Joey de Venecia told me yesterday on the phone. “The Ombudsman prosecutor only asked me if I ever met or talked with ex-President GMA about the deal. I said no, as that’s the truth. But I could not have exculpated her (because) there are documents.”

Joey was clarifying the headlines of his testimony Monday at the Sandiganbayan. GMA and husband Mike are charged with plunder for the past administration’s $329-million overpriced contract with the partly state-owned Chinese telecom firm, ZTE Corp. Joey in 2007 had blown the whistle on the $200-million (P10-billion) kickback. He was the original proponent in 2006 of a national broadband network, as a build-own-operate plan, at no cost to the government. But it was taken away from him when the Department of Transportion and Communication contracted ZTE to supply the NBN, under a stiff Chinese government loan. Mike Arroyo allegedly ordered him to “back off.”

The Senate extensively had investigated the scam in Aug. 2007-Apr. 2008. It was shown that GMA not only had witnessed the DOTC-ZTE contract signing in Boao, Hainan, China, on Apr. 21, 2007. She also had instructed four Cabinet aides in writing to proceed with the NBN and other deals with ZTE. The documents were splashed all over the newspapers then; copies are accessible in their websites.

One such document was a “special authority,” dated Apr. 20, 2007. It was for then-DOTC Secretary Leandro Mendoza (now deceased) to sign the NBN contract the next day in Boao “in behalf of the President.”

GMA issued the order despite forewarnings of irregularities from then-Sec. Romulo Neri, National Economic & Development Authority. She herself said so in a DZRH radio interview at the height of the controversy.

Neri revealed to the Senate that then-Comelec chairman, Benjamin Abalos brokering for ZTE, had offered him P200 million to approve the deal. From testimony transcripts, Neri swore he reported the bribery on the night of Apr. 20 to GMA, who told him to reject it.

Still GMA left the bedside of First Gentleman Mike, who had just undergone heart surgery, to fly to the Boao Forum late night Apr. 20. Before flying back early the next morning, she witnessed the signing at the Hainan airport of the NBN-ZTE and other deals with China. “She came and went like a thief in the night,” a Malacañang press release stated.

In the DZRH interview GMA said she proceeded to Boao, despite the negative info on the NBN-ZTE deal, since “it was with another state.” But another whistleblower, Dante Madriaga, had a different account.

IT-expert Madriaga testified at the Senate that his principal, whom he called “the Greedy Group,” was at the time asking ZTE for $30-million advance. The Group, consisting of engineer Leo San Miguel, finance man Ruben Reyes, and retired police general Quirino dela Torre, had been tasked by Abalos to work out the technicals-financials with ZTE. Fan Yan, ZTE’s finance officer, refused to release any more advances, after two earlier ones totaling $8 million. But when guaranteed that GMA no less would witness the signing, she relented to the additional $30 million.

Madriaga stated that $10 million went to the Arroyos.

Another whistleblower, Jun Lozada, came forward Feb. 2008 to tell about ZTE’s initial representations with the NEDA months ahead. The NBN was then more modest, costing $200 million, with $132-million overprice. Half the kickback was for the administration’s May 2007 congressional election campaign, the other half for the First Couple and Abalos’ Group.

GMA issued one other special authority for the NBN-ZTE deal, with then-Executive Secretary Eduardo Ermita. Dated July 12, 2006, it was for then-Trade and Industry Secretary Peter Favila to sign with subsidiary, ZTE International Ltd., a $4-billion memo of understanding for several projects, including the NBN. Favila signed the MOU that same day, with ZTE Corp. president (ZTE Int’l) chairman) Yu Yong.

GMA instructed presidential chief of staff Michael Defensor to sign as witness. Defensor’s counterpart witness from ZTE Corp. was chairman Hou Weigui.

Yu and Hou also signed the main NBN-ZTE contract in Boao with DOTC’s Mendoza. The latter’s authorization from GMA gave him full powers to implement the contract. With that, Mendoza asked then-Finance Sec. Gary Teves in May 2007 to facilitate the loan approval with China Export-Import Bank, and then-Justice Sec. Raul Gonzalez in June to render a supporting legal opinion. GMA let the latter two Cabinet aides move, despite Neri’s report of anomalies in April.

A week after GMA’s special authority to Favila, with Defensor, she gave them a second one. It was to grant Yu and Hou mining rights in the Mt. Diwalwal and North Davao gold rush sites in Compostela Valley. The Constitution, which bars foreigners from mining except under limited terms, was broken.

A year earlier, in Mar. 2005, GMA had granted China the right to survey the Palawan Sea bed, as part of “disputed waters” of the Spratlys. It was similarly unconstitutional. But it paved the way for multibillion-dollar business deals with Chinese state firms, mostly overpriced and unnecessary. In 2009 China declared ownership of the entire South China Sea, under a nine-dash map that includes the Palawan Sea.

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