Palace: ‘Onerous’ provision in Chico River project loan just ‘standard’
Credit to Author: kadraneda| Date: Mon, 25 Mar 2019 05:48:21 +0000
MANILA, Philippines — The “onerous” provision in the Chico River Pump Irrigation Project between the Philippines and China is just “standard,” Malacañang said Monday, as it dismissed criticisms that Manila would not be able to pay the loan to Beijing.
The loan agreement, signed on April 10, 2018, stated that “in case of default by the Philippines in repayment of the loan, China can seize, to satisfy any arbitral award in favor of China, ‘patrimonial assets and assets dedicated to commercial use’ of the Philippine government.”
Former Bayan Muna Muna Rep. Neri Colmenares said the loan agreement was “onerous and highly favors China” while Senior Associate Justice Antonio Carpio said Beijing could seize gas in the resource-rich Reed Bank, saying it falls under the category of “patrimonial assets and assets dedicated to commercial use.”
“What I am saying is, the onerous conditions that some are saying incorporated in the contract is standard between the lender and borrower to be sure that the lender will be getting what they have lent to the borrower,” Presidential Spokesperson Salvador Panelo said in a Palace briefing.
“I understand that this is a standard contract whenever our country gets loan from other countries. Others, are not like that. But you cannot also blame the lender if they will impose certain terms favoring them,” he added.
“Just like bank institutions when they lend,” he said, “they impose terms to make sure they would be paid.”
Panelo, who is also the chief presidential legal counsel of President Rodrigo Duterte, said the waiver of immunity in the agreement was “useless” because the government would be able to pay the P3.2-billion loan.
“It is not a possibility because we will never renege. We are known to pay our obligations,” he said.
He expressed confidence that the government could pay the P3.2-billion, saying, it’s a “small” amount.
Panelo said the government could no longer negotiate the terms in the contract , saying “you can only rescind that if there is fraud and or the intention of the parties are not written down.” /kga