Repudiate sovereign guarantee provision of concession deal – solon

Published December 12, 2019, 5:10 PM

by Martin Sadongdong & Antonio Colina

By Ben Rosario 

Buhay Partylist Rep. Lito Atienza on Thursday called for the repudiation by government of a provision in the concession agreement with two private water utilities that extends sovereign guarantee on all loans, whether local or foreign sourced, that the concessionaires incurred to implement water and sewerage projects.

BUHAY Party-List Rep. Lito Atienza (Lito Atienza FACEBOOK / MANILA BULLETIN)
BUHAY Party-List Rep. Lito Atienza
(Lito Atienza FACEBOOK / FILE PHOTO / MANILA BULLETIN)

Atienza directed the appeal to Malacañang as he noted that the Ayala-led Manila Water Company and Pangilinan’s Maynilad Water Services, Inc. earned a net income of P60.57 and P69.32 billion, respectively, over a period of 13 years, from 2006 to 2018.

The lawmaker revealed that for the first half of 2019 alone, Manila Water’s net income already reached P3 billion while Maynilad’s is higher at P4.5 billion.

“With such huge profits, I don’t think a sovereign guarantee for their loans would be necessary,” Atienza told a press conference on Thursday.

During the first day of briefing on the water supply and concession situation in Metro Manila, Atienza demanded that Congress be furnished with documents reflecting the foreign and local loans incurred by the two water concessionaires.

“We also want to know who will pay for the loans,” said the partylist solon.

Atienza, former mayor of Manila, said the public had always been at the receiving end of the concession deal entered by government and the two water concessionaires in 1997.

He acknowledged that the cancellation of the extension of the concession agreement (CA) may prompt the two water concessionaires to pass on to government their accumulated loans due to the sovereign guarantee in the CA.

However, Atienza said officials of the two water concessionaires may be held liable, especially for their failure to “tell the truth” in the cases they filed before the Permanent Court of Arbitration in Singapore.

Earlier, the Metropolitan Waterworks and Sewerage System disclosed that the board has revoked the board resolution extending the CA with the two water utility firms from 2009 to 2037.

The original CA was supposed to expire in 2022, it was learned.

Appearing at the joint briefing of the House Committee on Good Government and on Public Accounts, Deputy Administrator for Engineering Leonor Cleofas said the decision to cancel the extension of the CA was based on their review of its provisions.

Cleofas said 12 of the provisions were found to be onerous and put the government at a disadvantageous position.

According to Cleofas the revocation of the concession agreement extension was made on December 5 during a meeting of the MWSS Board.

 
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Repudiate sovereign guarantee provision of concession deal – solon

Published December 12, 2019, 12:00 AM

by manilabulletin_admin

By Ben Rosario 

Buhay Partylist Rep. Lito Atienza on Thursday called for the repudiation by government of a provision in the concession agreement with two private water utilities that extends sovereign guarantee on all loans, whether local or foreign sourced, that the concessionaires incurred to implement water and sewerage projects.

BUHAY Party-List Rep. Lito Atienza (Lito Atienza FACEBOOK / MANILA BULLETIN)
BUHAY Party-List Rep. Lito Atienza
(Lito Atienza FACEBOOK / FILE PHOTO / MANILA BULLETIN)

Atienza directed the appeal to Malacañang as he noted that the Ayala-led Manila Water Company and Pangilinan’s Maynilad Water Services, Inc. earned a net income of P60.57 and P69.32 billion, respectively, over a period of 13 years, from 2006 to 2018.

The lawmaker revealed that for the first half of 2019 alone, Manila Water’s net income already reached P3 billion while Maynilad’s is higher at P4.5 billion.

“With such huge profits, I don’t think a sovereign guarantee for their loans would be necessary,” Atienza told a press conference on Thursday.

During the first day of briefing on the water supply and concession situation in Metro Manila, Atienza demanded that Congress be furnished with documents reflecting the foreign and local loans incurred by the two water concessionaires.

“We also want to know who will pay for the loans,” said the partylist solon.

Atienza, former mayor of Manila, said the public had always been at the receiving end of the concession deal entered by government and the two water concessionaires in 1997.

He acknowledged that the cancellation of the extension of the concession agreement (CA) may prompt the two water concessionaires to pass on to government their accumulated loans due to the sovereign guarantee in the CA.

However, Atienza said officials of the two water concessionaires may be held liable, especially for their failure to “tell the truth” in the cases they filed before the Permanent Court of Arbitration in Singapore.

Earlier, the Metropolitan Waterworks and Sewerage System disclosed that the board has revoked the board resolution extending the CA with the two water utility firms from 2009 to 2037.

The original CA was supposed to expire in 2022, it was learned.

Appearing at the joint briefing of the House Committee on Good Government and on Public Accounts, Deputy Administrator for Engineering Leonor Cleofas said the decision to cancel the extension of the CA was based on their review of its provisions.

Cleofas said 12 of the provisions were found to be onerous and put the government at a disadvantageous position.

According to Cleofas the revocation of the concession agreement extension was made on December 5 during a meeting of the MWSS Board.

 
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