RP's image as investment site affected by NBN deal - Chinese official

BEIJING, China – A senior People’s Republic of China (PROC) official said here yesterday that the cancellation of the national broadband network (NBN) project bagged by Chinese telecommunications firm ZTE Corp. has affected the Philippines’ image as a potential investment destination among Chinese companies.

Liang Wen-tao, deputy director general of the Department of Asian Affairs of China’s Ministry of Commerce, said that Chinese investors would take into account the cancellation of the NBN-ZTE project with the Philippines and think twice about investing.

“The incident did have some impact on the economic cooperation between the two countries,” Liang told ASEAN journalists in a briefing at the Ministry of Commerce office in Beijing the other day.

Liang said that in view of the “incident,” Chinese firms would be more cautious in undertaking projects with the Philippines.

“They will naturally become more cautious in looking at making investments in the Philippines,” Liang said.

“Naturally, there is an impact to potential investments,” Liang said.

He said that China was spearheading a call for mutual investments between Chinese and ASEAN countries and their private enterprises as a strategy to help them weather the current global economic difficulties.

Liang said that China was giving priority to its ASEAN neighbors in allocating foreign investments.

“China will look at its neighbors, the countries of ASEAN, when it decides on foreign investments,” Liang said.

He noted that trade between China and ASEAN has continued to grow since the 1990s and China and ASEAN have now become the fourth largest trading partners.

Last year, President Arroyo cancelled the $329-million contract with ZTE Corp. amid allegations of bribery and corruption involving First Gentleman Jose Miguel Arroyo.

Mrs. Arroyo also cancelled other government projects funded by Chinese overseas development assistance (ODA) loans, including the more than P24-billion Cyber Education Project of the Department of Education (DepEd) bagged by Chinese firm Tsinghua.