Government to review projects funded by China ODA

The government will be reviewing all projects funded by official development assistance (ODA) from the Chinese government including the Southrail project as part of efforts to prevent another controversy similar to the broadband deal between ZTE Corp. and the Philippines.

“President Arroyo’s instruction is to review all ODA funded projects proposed by the Chinese government,” Trade and Industry Secretary Peter B. Favila told reporters yesterday.

In January, the Chinese and Philippine governments signed a loan agreement worth over $1 billion to finance government’s various priority projects.

Favila said as per the President’s instruction, the DTI will prioritize what is important and will even hold consultations with various stakeholders in order to thresh out oppositions early on.

“I can do consultations with stakeholders in order to stop people from opposing approved projects,” Favila said.

According to Favila, he has asked for a copy of all the project proposals endorsed by the Chinese government.

“We will hear their proposal. I’ve been asked to review all of these proposals, I’m still in the process,” he explained.

However, Favila refused to name all the projects included in the review.

Favila likewise did not give details as to how long the review will be and who is included in the group that will review the projects.

Early this year, a memorandum of understanding (MOU) worth $500 million was signed for the development of key infrastructure projects. The National Economic Development Authority (NEDA) will recommend where the money will be allocated.

Former NEDA director general Romulo L. Neri said most likely the money will be for the Southrail and other water supply projects.

Southrail is a multi-million project linking Calamba, Laguna and Lucena, Quezon. It involves the rehabilitation of railroads and the purchase of electric and diesel trains

Another $500-million loan agreement is for the continuation of the Northrail project. The Chinese government is financing 83 percent of the country’s Northrail project through ODA under the Chinese Concessional Loan, while the rest will come from local and foreign commercial loans.

The Chinese government will likewise provide $100 million to bankroll the Non-Intrusive Container Inspection System Project, Phase 2 under a framework agreement. Under the framework, the two governments will discuss which projects to undertake under the concessional loan package.

Also, a P100-million grant will be given for the formulation, promotion and implementation of projects under the Agreement on Economic and Technical Cooperation between the two countries.