Left Flank

Rina bravely admits to a praiseworthy perplexity and skepticism about the constitutional fracas occurring around the NBN-ZTE scandal in The Philippines. I'll join her in that predicament, and, as a non-Filipino, I think I need more help than she does.

ZTE Corp. issued a statement denying allegations by witnesses testifying in a Philippine Senate anti-corruption hearing that a former elections chief and President Gloria Macapagal Arroyo's husband were promised huge commissions to clear a national broadband contract with the Chinese company.

Both men have denied the accusations, and the deal was scrapped last year. But the scandal and nationally televised hearings have continued, threatening Arroyo's administration with fresh opposition protests and coup rumors.

(…)

Last year, a Filipino businessman who lost to ZTE the bid for the project to link online all government offices told senators the US$330 million (€225 million) ZTE proposal was overpriced by US$130 million (€89 million) to accommodate kickbacks demanded by ex-elections commissioner Benjamin Abalos and the president's husband, Jose Miguel "Mike" Arroyo.

Former Socioeconomic Planning Secretary Romulo Neri testified that Abalos offered him a bribe to approve the ZTE proposal, which he refused. Neri stopped short of linking Arroyo or her husband to the scandal.

Last week, Neri's former consultant, Rodolfo Lozada Jr., surfaced in the Senate after claiming he was held for two days by government agents to prevent him from speaking.

He said he discussed the deal with ZTE officials but failed to "moderate the greed" of brokers like Abalos, who last year quit as the elections chief. He also claimed Abalos threatened to kill him if he did not secure a kickback for him.

Obviously, ZTE, and the PRC government, will plead its innocence, and make threatening noises about not spoiling the business environment.

The problem is, that business and constitutional issues are intertwined. On the one hand, there's what actually might have happened between Chinese and Filipino businessmen and the two governments related to broadband companies. But then, because the scandal snared congressional figures, there's the constitutional relationship between Congress and the president. There's also President Gloria Macapagal-Arroyo's lack of popularity, which doesn't stop her from fighting.

President Arroyo spoke yesterday for the first time about the NBN issue after Lozada's explosive Senate testimony, saying she trusts the impartiality of the Ombudsman in its probe.

«We want to fight corruption.  The Ombudsman, who is constitutionally independent, has announced that she will carry out a review of this issue and the related allegations,» Mrs. Arroyo said in her speech at an economic briefing jointly organized by the Investor Relations Office, the Manila Overseas Press Club, and the Foreign Correspondents Association of the Philippines. Lozada told the Senate last week that her husband and Abalos demanded kickbacks from the ZTE deal.

«We take the ZTE issue very seriously,» Mrs. Arroyo said adding that she «moved quickly to cancel the project as soon as I could after proper consultation with government of China, our biggest export market.»

She said she has instructed Justice Secretary Raul Gonzalez to investigate the others implicated in the deal who are not within the jurisdiction of the Ombudsman. «We do not tolerate corruption,» she said.

«I trust that the Ombudsman will investigate this issue thoroughly and that she will ensure a transparent process in doing so.  I instruct the Secretary of Justice to likewise be thorough and transparent in his investigation,» Mrs. Arroyo said.

The President noted that allegations of corruption «have regularly emerged even in previous administrations as part of our less-than-impressive political culture.»

«I just hope this set of charges will not be a political football,» Mrs. Arroyo said. She said there's no way she could eliminate the «legacy of political corruption» overnight but stressed her administration has achieved great strides in its battle against well-entrenched grafters.

She said fighting corruption is one her administration's major goals.

Even if the NBN-ZTE scandal is like Watergate, Rina, just keep repeating, "Bring It On!" (So, for Rina, a little musical relaxation—more available, but it's in Tagalog)

I can find three reasons why the NBN {National Broadband Network)-ZTE ( Zhong Xing Telecommunications Equipment Corporation) scandal in the Philippines is so compelling. Yesterday's Inquirer editorial, comparing NBN-ZTE to America's Watergate, almost makes the question obligatory.

Philippines' President Gloria Macapagal-Arroyo's visit to inform PRC President Hu Jintao of the project's cancellation looks like «kowtowing», as if GMA were reporting to a superior for the actions of her subordinates in the Congress for the delays in implementing the deal. GMA suspended two Chinese-supported projects on September 22, after bribery allegations surfaced against Benjamin Abalos, which is the second cause for concern. Abalos' legal and political status, whether he resigned or not, or whether he is still impeachable, is uncertain.

Finally, there's the impact the scandal will have on the Philippine's reputation:  «...poor governance and our weak institutions are a guarantee that ZTE will not be the end of corruption scandals here.»

Bribery, China, and a woman president seemingly more respected abroad than at home make for a story that might not yet have reached its climax!

Devon Stewart and Joshua Kurlantzick at BHTV take a little time to mention the subject of Chinese investment in the Philippines IT sector.

In the ongoing series of articles investigating the National Broadband Network (NBN) project, the latest fireworks in Manila come from Senator Miriam Defensor-Santiago (which is one of the best names I've ever heard):

An embarrassed Sen. Miriam Defensor-Santiago Thursday apologized for saying that China «invented corruption» during a heated hearing on the allegedly overpriced National Broadband Network (NBN) project that the Philippine government signed with a Chinese company.

«I will write a formal letter of apology to the Chinese ambassador,» Santiago, head of the Senate foreign relations committee and a close ally of President Gloria Macapagal-Arroyo, told reporters.

Santiago, famous for her mercurial temper, berated China in Wednesday's nationally televised hearing on the $329-million NBN project that was awarded to China?s Zhong Xing Telecommunication Equipment (ZTE) Corp. amid allegations of bribery and overpricing.

Former Socioeconomic Planning Secretary Romulo Neri and businessman Jose «Joey» de Venecia III, whose company lost the NBN contract, testified that they were offered bribes by Commission on Elections Chair Benjamin Abalos to clear ZTE for the contract, which has since been suspended.

Abalos denied the allegations but admitted that ZTE officials were his «golfing buddies» and had paid for his trips to China.

«China invented civilization in the East, but as well it invented corruption for all of human civilization,» Santiago said during the hearing.

She also admonished witnesses at the hearing for «just fighting over your kickbacks.»

That's just the beginning of good quotes in the article, and each a compelling argument. Yes, it does happen once in a while. Politicians and other public figures do achieve some sort of vocal competence, but it's probably just good staffwork.

The Chinese Embassy gives as good as it gets.

«We believe that the Philippine government and the people of the Philippines will not agree to that. It is known to all that anticorruption is a common task faced by all the countries of the world. Corruption exists not only in China, nor was it created by China,» the embassy said.

«The Chinese government has all along devoted itself to the building of an honest and clean government and combat against all forms of corruption,» the statement said.

«In recent years, the Chinese government has adopted even tougher measures in combat against corruption and achieved prominent results. [We] think people of insight can all see it.»

Aside from the philosophical issues, I think this is why China will always at least stymie the force of international opprobrium against it. It's just a savvy rejoinder. Not only does China have a line to sling, which in someways rivals western universalism (whatever you or I think about that), but it does it such a polite manner. None of the Toxic Texan Two-Step's bravado or the Filipino-Chinese Chambers of Commerce and Industry, Inc's sarcasm.

Finally, for sheer straightforwardness, there's Senator Manuel Roxas II:

«The problem is not China. The problem is that Philippine officials, every time they enter into a deal with China, they use that as an excuse to bypass the regular procurement laws which require bidding. That's the problem, it's not our transactions with China...»

Concerning the particulars of the NBN deal (via The Daily Dose), I'm reticent to comment. I find Philippine politics exhilarating, like a rat on methamphetamines, but the details are a bit blurry still. But, if i have to commit, why reinvent the wheel. especially if it costs more the second time?

But, the two above-mentioned quotes from Defensor-Santiago and Roxas II are worth a really good thunk.