Chinese complaint: $200 M, still no railway

MANILA, Philippines - Hundreds of millions in Chinese assistance intended for a railway project have been exhausted, President Duterte said, as he vowed to put at stake his life, honor and the presidency in his fight against corruption.

Speaking before members of the Filipino community in Hong Kong on Saturday, Duterte said “China was complaining. The funds were allotted for the railway.”

Duterte did not mention the currency of the 200 million and did not elaborate on the issue, which he brought up hours before he flew to China to attend the Belt and Road Forum for International Cooperation slated yesterday until today.

It was not clear whether Duterte was referring to the nearly $200 million in conessional loan disbursed to the Philippines by the Export-Import Bank of China for the $500-million Northrail project. The railway, planned during the presidency of Gloria Macapagal-Arroyo, would have connected Manila to the Clark International Airport in Pampanga.

In 2012, the Philippines and China’s Eximbank signed a deal for the repayment of the $180.8-million loan disbursed for the controversial project, plus interest of three percent due yearly until 2014.

The Aquino administration scrapped the project in 2012 because of alleged corruption and other irregularities.

Officials said the Philippines bagged about $24 billion worth of investment and financing agreements during Duterte’s visit to China last October.

The visit was meant to repair the relationship between the Philippines and China, which has been strained by the dispute in the South China Sea.

Of the amount, $15 billion are for investment projects and $9 billion for credit facilities. More than half of the credit facilities or $6 billion will come in the form of official development assistance while $3 billion will be provided as loans.

The projects that may be funded by the assistance include a P200-billion railway from Manila to the Bicol region.

Duterte was all praises for China when he met with members of the Filipino community in Hong Kong and explained why he had not been bringing up the South China Sea dispute between Manila and Beijing.

“One thing is very certain actually, China in all good faith wants to help us,” Duterte said.

“They are not asking for anything in return. There were no conditions. They just want to help. They have lots of money,” he added.

Duterte cited China’s plan to build two bridges across the Pasig River, which is part of the investment package agreed upon by the Philippines and China.

“To date, I can’t say anything except my profuse thanks to China for helping us out.”

Last year, a Hague-based tribunal ruled that China’s maritime claim in the South China Sea, which covers about 90 percent of the crucial trade route, has no legal basis.

The ruling stemmed from a complaint filed by the Philippines under then president Benigno Aquino III in 2013.

China rejected the ruling, calling it “a mere piece of paper” and “illegal since day one.”

Duterte has said he is ready to set aside the ruling as the Philippines seeks to strengthen its relationship with China.

Critics have accused Duterte of being too cozy with China and selling out Manila’s interests to Beijing. The President has denied this as he promised to discuss the ruling with Chinese leaders within his term.

Duterte is not likely to bring up the South China Sea dispute during the Belt and Road Forum for International Cooperation, which was expected to be attended by 27 heads of state.

“I come here and you must be apprised also, conscious of the fact that we have a conflicting claim. You’re claiming (South) China Sea as yours. And we claim it as ours also. And as a matter of fact, we went to a court, international body to settle these things, and we won the arbitration,” the President said.

“I will not bring it up at this point in time because it would not be proper since I am here as a guest,” he added.

While he is not keen on discussing the dispute, Duterte defended the rotation of Philippine troops in Pag-asa, the second largest island in the disputed Spratlys chain.

“To the Chinese government, we have been there since 1974 in Pag-asa,” Duterte said.

“We replace our troops there every three months,” he added.

The Philippines and China will start next week the bilateral talks on the South China Sea dispute.

Philippine Ambassador to China Jose Santiago Sta. Romana made the announcement during a press conference in Beijing on Saturday.

The ambassador said the mechanism may be initiated shortly and that the venue of the talks is in southwestern China.

Sta. Romana said Duterte and Chinese President Xi Jinping will not participate in the initial bilateral talks.

“The first session will really cover the terms of reference and the basic. Try to draw an agenda so the first session will be the long step in the long journey... What it provides is a platform, a mechanism to bring out the issue,” he said.