PEZA clears Xianglu Dragon project in Philippines

MANILA, Philippines - The Philippine Economic Zone Authority (PEZA) has decided to pre-qualify the proposed projects involving alleged “notorious Taiwanese fugitive swindler” You-Hao Chen.

Director general Charito Plaza said PEZA has granted in late July pre-qualification clearance to First Pangasinan Industrial Corp.’s planned mixed-use economic zone in Pangasinan. First Pangasinan is a 60 percent Filipino and 40 percent foreign owned firm.

The project will bring in foreign funding from several Chinese state-owned and Fortune 500 multinational firms from China, Taiwan and Singapore for a 30-year project that could encompass a total 3,000 hectares.

Plaza said Chen’s Xianglu Dragon Group (XDG) would serve as a “coordinator” for the project and would also likely be a locator in the development. 

“The pre-qualification is still pre-qualification. Final approval is still the presidential proclamation. Due diligence will continuously be conducted. We suggested that all related agencies will also be doing their due diligence. We are giving the company a fair trial,” Plaza said. 

Aside from the proposed economic zone in Pangasinan, XDG will also lead a consortium to develop an 85-story hotel with IT services component along Roxas Boulevard in Manila. 

Plaza said the agency conducted its own background check on Chen and his company as it did not want to prejudge the parties based on a report submitted by the Taipei Economic and Cultural Office (TECO). 

“However, to be fair and effective on our due diligence, we do not want to be swayed by any bias. Otherwise it will make PEZA biased as well. We felt this is not a proper way to treat a prospective investor in the Philippines,” Plaza said. 

Plaza instead urged the Taiwan government to take its concerns with Chen directly to the Chinese government. 

 “Please give us also the respect because this is going to be a project that will be enjoyed and benefit many in the country,” she said. 

Speaking on behalf of the Taiwan government, TECO issued a statement last week alerting the country about Chen’s highly risky investment projects and urged the  Bureau of Immigration to deport Chen back to Taiwan for justice as soon as possible. 

TECO said Chen was issued a circular order of arrest on Jan. 14, 2014 by the Taiwan Taipei District Court. 

A former CEO of Tuntex Group in Taiwan, Chen was prosecuted by the Taiwan Taipei District Prosecutors Office on account of fraud, unlawful embezzlement and other serious economic crimes of defrauding, according to TECO. 

In statement yesterday, XDG denied TECO’s allegation that its chairman, Chen, embezzled money in Taiwan and then fled to China.

XDG said Chen’s roots are from Xiamen, China and had long been a well-respected businessman there.