China allays 'security threats' fear over entry of Chinese telecom to Philippines

MANILA, Philippines — China on Thursday said it has reminded Chinese enterprises abroad to follow international and domestic laws, dousing fears of some Philippine lawmakers over “national security threats” posed by the possible entry of a Chinese telecom provider to the industry.

In November last year, President Rodrigo Duterte invited China to be his country’s third telecom provider that will challenge a longstanding duopoly.

Beijing later picked China Telecom to invest in the Philippines, backed by a consortium of Filipino businesses.

However, Duterte’s offer to China did not sit well with some lawmakers, who pointed out that giving the Asian power access to Philippine communications infrastructure could be a "Trojan horse" and “a serious threat to national security.”

A third telecom carrier is targeted to be up and running by the first quarter of 2018.

“We've also said many times that the Chinese government always asks them to abide by the market principles, international rules and local laws and regulations,” Chinese Foreign Ministry Spokesperson Lu Kang told a press conference when sought for comment.

“We also hope that other countries could offer necessary and amicable conditions and environment for Chinese enterprises,” Lu added.

Lu also said such a partnership between China and the Philippines testifies to the increasing mutual trust between the two countries and “the vast cooperation potential.”

“The China-Philippine relations have been improving, and bilateral practical cooperation has been yielding fruitful outcomes, delivering tangible benefits to the two peoples,” he remarked.

Malacañang had allayed fears over possible risks posed by the entry of a third player, saying measures would be in place to protect the country’s cyber security. 

Despite Duterte's warm relations with China, the Philippines has a long history of mistrust of it amid China’s maritime encroachment on the contested South China Sea — control of which is at the heart of a territorial dispute between the two countries.

According to a report by Reuters, US lawmakers are seeking to bar Chinese telecom firms Huawei or ZTE Corp. from entering US market due to “national security concerns.”

Aside from China Telecom, the Palace earlier said South Korea’s LG Uplus Corp., Japan’s KDDI, and a Taiwanese telecom firm that is yet to be revealed are also eyeing the Philippines’ third telecom slot.

READ: Andanar: Firms from Japan, Taiwan also interested in being third telco player

Last year, incumbent providers PLDT and Globe together agreed to buy conglomerate San Miguel Corp. out of the sector for $1.5 billion, pledging to invest heavily to boost internet service.

The Court of Appeals, in a decision dated October 18, ordered the Philippine Competition Commission to permanently stop its review of the deal and recognize its validity.