Revoked extension of water concession deals good for business, Andanar says

MANILA, Philippines — President Rodrigo Duterte's opposition to the government's agreements with the two major water distributors is favorable to businesses as it proves that he does not condone any form of corruption, Malacañang said Thursday.

Presidential Communications Secretary Martin Andanar said Duterte was telling Manila Water and Maynilad that he is against "onerous" deals and there are no sacred cows in his administration.

"The main point here is that we should not be entering into onerous contracts. This is in fact, doing the business community a favor by telling them that there is no room for corruption in our business industry and under the term of President Rodrigo Roa Duterte," Andanar told ABS-CBN News Channel.

"There are no sacred cows. You've been asking for 'big fish', and there you go," he added.

Andanar also disagreed with speculation that Duterte is criticizing the owners of the water firms so he could replace them with his "oligarchs."

"I don't think so....I think the purpose here is to send the message to both Maynilad and Manila Water that the president is not accepting this kind of reasoning and this kind of onerous contract," he said.

RELATED: Water utilities' woes seen hurting investor confidence

"That's why the MWSS (Metropolitan Waterworks and Sewerage System) revoked the extension of the contract and both Manila Water and Maynilad already wrote a letter to the president," he added.

The concession deals with Manila Water and Maynilad were signed in 1997 and were supposed to last for 25 years. The agreements were extended by 15 years in 2009 or 13 years before they were to expire.

Last week, Duterte accused water firms of "screwing" the Filipinos and demanded revisions to the concession deals they signed with the government in 1997.

He said the contracts were contrary to public policy and had violated laws against graft and plunder.

Duterte, in particular, is seeking the removal of contract provisions that he said prohibit the government from preventing water rate hikes and allow water firms to collect indemnities when they incur losses due to regulatory actions.

Duterte has also decried decisions by a Singapore arbitration court ordering the government to pay more than P10 billion to the two concessionaires for the losses they incurred due to the delayed implementation of rate increases.

READ: NEDA: Demand to amend water concession agreements will not scare away investors

Manila Water and Maynilad have announced that they would no longer collect from the government the amount awarded to them by the court.

Presidential spokesman Salvador Panelo has confirmed that the water firms had written a letter to Duterte expressing their willingness to revisit the concession agreements.

Last Wednesday, MWSS disclosed that it has revoked the extension of the contracts, alarming the investors and creditors of the water distributors. 

Lawmakers who belong to the so-called Makabayan bloc suspect that Duterte is lambasting the owners of Manila Water and Maynilad to favor his allies. They said the task of distributing water should be reverted to the government.