US telecom execs willing to testify in ZTE probe

Officials of a US telecommunications firm have expressed willingness to testify in the looming congressional investigation of the controversial $330- million broadband contract between the government and ZTE Corp. of China.

Scott Arey, chief financial officer of Arescom Inc., said company executives recently met with officials of the Department of Transportation and Communications (DOTC). He did not say what came out of the meeting.

Arescom had offered to undertake the National Broadband Network of the government, but was edged out by ZTE.

“We would certainly not rule out making an appearance before the Philippine congress and would most likely welcome the opportunity,” Arey told The STAR.

“However, we are not interested in becoming anyone’s political pawn and will not engage in any grandstanding or deliberate inflammatory actions,” he said.

Arescom and local firm Amsterdam Holdings Inc. are questioning the ZTE contract signed last April 21 in Boao, China. The contract stipulates that the Philippine government would borrow $330 million from China under “concessional” rates.

Arescom and AHI described the deal as grossly overpriced and onerous as it appeared to have violated some laws and is inconsistent with the government policy of allowing greater private sector participation in projects of such magnitude.

Arescom submitted a bid of over $150 milllion while AHI, owned by Jose de Venecia III, proposed $245 million.

De Venecia, a son of Speaker Jose de Venecia, said AHI’s proposal is superior since it will be fully privately funded and will not require a sovereign guarantee.

The US Embassy earlier decried the apparent lack of transparency in the forging of the deal with ZTE.

President Arroyo has ordered Justice Secretary Raul Gonzalez to review the contract. Senators vowed to investigate the ZTE deal as soon as the 14th Congress opens next week.

DOTC Secretary Leandro Mendoza said he is ready to face any investigation, including congressional inquiries.

“If there’s any investigation that is going be conducted, then we are ready to face any investigation or queries, even in the courts – it’s a good project,” Mendoza told reporters at Subic where Mrs. Arroyo inaugurated the Subic Bay Container Terminal 1.

“These losing bidders give lower figures when they lose. But when they submitted their bids, their figures were different,” Mendoza said.

“If you compare apple to apple and the full coverage of the project, the ZTE contract is the best.”

He admitted the DOTC is still waiting for a legal opinion from the DOJ.