Press Release
September 23, 2007

GMA'S ORDER TO SUSPEND ZTE CONTRACT UNAVOIDABLE
DUE TO TRO ISSUED BY SUPREME COURT -- PIMENTEL

Senate Minority Leader Aquilino "Nene" Q. Pimentel, Jr. (PDP-Laban) today said President Gloria Macapagal-Arroyo's order suspending the effectivity of the National Broadband Network project awarded to China's ZTE Corporation is both a useless and superficial surplussage and a devious ploy to befuddle the public about the nature and status of the ZTE contract.

Pimentel said although the indefinite suspension order is a predictable and expected move on the part of the President, it also implies that the executive branch has not given up on its plan to implement the contract despite the controversy surrounding it depending on the ruling of the high tribunal.

"It is a surplussage," Pimentel said, "because the Supreme Court had already issued a temporary restraining order (TRO) precisely to stop the deal in its anomalous tracks, be it only temporarily." He added that "the presidential move is also a devious ploy to confuse the people because what is immediately needed is a presidential decision to scrap the deal and not merely to suspend its effectivity."

"But the most sensible thing that the President can do is to rescind the government's $329 million broadband contract with ZTE, instead of just suspending it," the minority leader said.

"I cannot see how Mrs. Arroyo can justify the deal in the face of allegations that it is overpriced and the claim that a national broadband network can be undertaken by Philippine telecommunications firms at no cost to the government through the build-operate-and-transfer scheme."

Pimentel said the President should admit that she and her Cabinet made a grave mistake when they abandoned the administration's policy to pursue capital-intensive telecommunications projects through the BOT concept to spare the government of expenses in favor of the ZTE project proposal which will entail a $329 million loan from China to be incurred and/or guaranteed by the government.

"Ultimately, it is the Filipino people who will be harmed by this transaction because they will end up paying for the loan incurred for a broadband project of doubtful importance to the nation," he said.

Naturally, Pimentel said officials of ZTE Corp. are opposed to the scrapping of the contract because they have already invested a lot of money, including the commission allegedly given to a top government official who supposedly acted as broker.

It is doubly difficult to rescind the ZTE contract if what Joey de Venecia had testified to before the Senate is true that some advances in dubious commissions had already been advanced to some officials in the government.

Moreover, considering the political climate in China today, scrapping the ZTE deal because of alleged bribery could put in grave danger the lives of some ZTE officials if found to have been responsible for it.

Saying the suspension of the NBN project does not mean the shelving of the congressional inquiry into the deal, Pimentel said Comelec chairman Benjamin Abalos should not cash in on this turn of events to change his mind about testifying before the Senate investigating panels.

"Chairman Abalos should take advantage of the opportunity to explain his side on the allegation that he brokered the deal with ZTE and even made a number of trips to China during the period when Comelec was by law required to supervise the preparations," he said.

Pimentel also urged Commission on Higher Education chairman Romulo Neri, former director general of the National Economic and Development Authority (NEDA) not to bow to pressures allegedly being exerted by powerful forces that do not want him to testify before the Senate.

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