Decision to have a Chinese telecom player a 'political decision'

MANILA, Philippines — The decision of President Rodrigo Duterte to allow a Chinese company to become the country's third telecommunications player was a "political decision" meant to strengthen Manila and Beijing's bilateral relations, a spokesman of the Philippine leader said on Tuesday.

“The Chinese government has selected a company that will invest in the telco (industry) of our country. It is China Telecom, the largest telecommunications company in China,” Martin Andanar of the Presidential Communications Operations Office said over dzBB. 

Harry Roque, a spokesman for Duterte's office, dubbed this possible entry as a means to break the "duopoly" of Smart and Globe, the Philippines' main service providers.

Roque said that the choice of China was because the president would like to strengthen further the two nations' ties and Beijing had one of the biggest telecoms market in the world.

"But it was a political decision of the President to...to offer it to a Chinese company. Intended I guess also to strengthen our bilateral ties with China, coupled with the fact that given the huge telecoms market in China, Chinese companies ought to have already technical know-how ‘no in providing competent and reliable telecom services," Roque said in a media briefing in the ornate, wood-paneled presidential palace.

"And the eventual player that was chosen by China, China Telecom without doubt is one of the biggest in the world ‘no. And of course, we want to avail of the fact that we’re very proximate to China ‘no," Duterte's spokesman said.

The chief executive invited China last month to invest in the Philippines' telecoms market, one of the most unreliable and inefficient in Asia Pacific, following the bilateral meeting between Duterte and Li Keqiang, China's premier.

Over the weekend, government officials said that state-run China Telecom Corp. could become the country's third telecoms player as Manila continued to try to improve the country's notoriously poor internet and voice services.

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Roque also doused hesitations that the entry of a company would expose the Philippines' data infrastructure to a state-run firm of China, which has a long-running territorial dispute with Manila over waters in the West Philippine Sea.

"Well, as far as security considerations are concerned, we will look into that because there are really concerns overall on cyber security in general," he said.

Inviting other foreign players from other countries would not be easy, according to Roque, as there is already a standing invitation to a Chinese company to invest in the country's telecoms infrastructure.

"[I]t would not be as simple as it seems. There will be legal challenges. But we are confident we can overcome all these challenges because after all it is our commitment to provide viable public service in the telecoms industry to the Filipino people," he said.

Andanar, the PCOO official, said that China Telecom would have to find a local partner as the Philippine Constitution limited foreign ownership of public utility to 40 percent.