On expensive China loans/ODA

On February 21, 2018, Philippines Defense Forces Forum posted this photo and brief note:

NEDA secretary Ernesto Pernia admits China's interest rate of 3% is much higher than Japan's 0.25%-0.75%, in talk in front of businessmen and economists this afternoon.

Asked why the government is availing more of China's expensive loans than Japan's cheaper offer Pernia could only reply "Because we need more friends". #IdolNiDuterte #ChinaPuppet

It was Dr. Ciel Habito who asked Pernia that questions. Now notice this statement: 

"Pernia admits China's interest rate of 3% is much higher than Japan's 0.25%-0.75%... because 'we need more friends.'"

Ok, PH taxpayers are "less friends" of the Duterte administration that is why we must pay more taxes via TRAIN and they will give more money to their "more friends" China Communist Party. Magaleeeng.

To the Dutertenomists and TRAIN rah-rah boys and girls -- eto abangan nyo: the main purpose of "more revenues via TRAIN" is not exactly more infra but more payment for China loans. We have NLEX, SCTEX, TPLEX, SLEX, STAR, CAVITEX, NAIAEX, Skyways, etc even without big tax hikes. Lots of "hybrid PPP" were actually integrated PPP before President Duterte came to power.

Integrated PPP means no need for new ODA, new loans from China or elsewhere, no need for tax-tax-tax because the private builders of those big infra have the financial, technical and engineering resources, network to build those behemoth structures at minimal cost to taxpayers (only right of way cost, etc). Hybrid PPP means more loans, especially from the China communist party.

Recall also that when Ernesto Pernia was newly appointed as NEDA chief, he justified the series of drugs murders as "necessary evil." 

Tweets February 21:

@bendeveraINQ (Ben Arnold de Vera)

@SecPernia: First basket of infra projects for Chinese financing includes Kaliwa Dam, Chico River Pump Irrigation, North-South Railway south line between Manila and Bicol.

@Noysky

Replying to @bendeveraINQ @SecPernia @InquirerBiz

Wow, tax-tax-tax de TRAIN so that PH govt can pay these big loans fr China? Horrible. These shd be integrated PPPs and not charged to taxpayers.

Gus Cosio @gus_cosio

Replying to @ClaireJiao @Noysky @cnnphilippines

Japan offers better quality performance at cheaper cost. Why in heaven’s name will you burden us with this preposterous idea?

@bendeveraINQ

@SecPernia: But the Japanese had been slow in process of financing projects, while the Chinese has become more aggresive @InquirerBiz

@bendeveraINQ

@SecPernia: Chinese loans, at best, slapped 2-3% interest per annum vs. Japan soft loans/ODA at 0.25-0.75%, but we haven’t signed loan agreements with China yet DD-biz-INQUIRES_

@bendeveraINQ

Pernia: We don’t want a repeat of our previous experience with China (referring to NBN-ZTE deal), that’s why PH and Chinese govts established vetting process for Chinese firms bidding for PH projects under @NEDAhq ICC @InquirerBiz.

Now see this report,

http://bworldonline.com/3-chinese-firms-interested-kaliwa-dam/

3 Chinese firms interested in Kaliwa dam

February 16, 2018 | 12:15 am

"Under the previous administration, the P18.72-billion Kaliwa dam had two pre-qualified bidders, which are now out of the picture... It used to be a public-private partnership, with MWSS as implementing agency.

Since the project is funded by ODA from China, Mr. Velasco said there will be no pre-qualification stage since the Chinese embassy identifies the three pre-qualified companies."

Another big China loan, contractors and suppliers identified by China embassy, very likely cronies of the China Communist Party. PH goverment agencies will wait for the terms and say "Yes", and PH taxpayers will pay for the bill, courtesy of TRAIN de tax-tax-tax. 

From sir Doy Segundo E Romero, Feb. 22:

"ON CHINA'S HEGEMONIC ACTIONS AGAINST THE PHILIPPINES

A few weeks ago, an EU ambassador posted in Sri Lanka repeated to me what a Chinese diplomat told him: 'No big deal. The Philippines is not even a real country.' Nasaktan talaga ako."

Last week, Dr. Pernia replied in my fb wall where I tagged him on this subject. He wrote,

"Nonoy Oplas got it all wrong — making a comment without even knowing the context. Rather unscholarly and malicious!"

I replied, "Ok Sir Ernie, what is the non-malicious explanation why (a) PH government should get new foreign loans when many projects were already under integrated PPP (not "hybrid" that require new loans, or new public spending and hence, new taxes), and (b) why China loans considering that China interest rates are high, and China Communist Party is a theft of PH territory?

I will apologize for my statements above if these can be clarified. Thank you."

As I expected, no further reply or clarification.

EFN Asia 3: Conference in Jakarta

Here in Jakarta, Indonesia, for the Economic Freedom Network (EFN) - Asia annual conference, October 6 to 8, 2010, at Sultan Hotel. Arrived here this afternoon with 3 other Filipinos, all academic economists -- Dr. Alvin Ang (Univ. of Santo Tomas), Dr. Lawrence Dacuycuy (De La Salle Univ.) and Dr. Ernesto Pernia (Univ. of the Philippines). Ernie represents the Foundation for Economic Freedom (FEF), Lawrence represents the Philippine Economic Society (PES), both are local partners of FNF Philippines. Alvin is sponsored by Atlas. I was also sponsored by FNF and I represent our think tank, Minimal Government Thinkers, Inc.

All four of us are either panel speakers or panel moderators. Ms. Jyoti Sachavirawong, a friend and the overall conference manager, made sure that Filipino participants will wrack a part of their brains for this conference. :-)

The theme of this year's conference is "Migration and the Wealth of Nations". Sort of "modern Adam Smith" :-)

Well, migration is not exactly a "modern" phenomena, it's an old occurence dating back before the modern man (before the homo sapiens species). It's just that with globalization, migration and people mobility across countries and continents is becoming an ever-increasing phenomenon for many people in many countries. Adam Smith of course, is the author of the famous book, "The Wealth of Nations", among the classic work for people who believe in individual freedom and free market.

The conference program is here,

Going through the names of speakers and moderators, I think I personally know at least 1/3 of them. Some were fellow participants of the 4th Pacific Rim Policy Exchange in Sydney, Australia, last week.

This is my first time to be in Indonesia, so I was excited to see this city. Jakarta's international airport looks old -- well, not the usual steel and glass structures in many modern Asian airports these days -- like Manila's terminal 1. But the Jakarta airport is big.

Jakarta's road infrastructure is better than Manila's. I did not see potholes on the roads, for instance. But Jakarta's traffic is a lot worse than Manila's. We arrived at the hotel around 3:30pm local time, meaning non-rush hour, but traffic gridlock was bad. It's good that our taxi driver was very brave on the road, we sneaked through the gridlock by passing through the highway's shoulder made narrow by huge trucks and thousands of cars.

Of the 10 member-countries of the Association of South East Asian Nations (ASEAN), Indonesia has the biggest population, should be about 230 million now, while the Philippines is 2nd biggest at 94 million. So comparing their capital cities, Jakarta and Manila, would make some sense. Jakarta's population is about 20 million? Metro Manila's is 12 million. Among the megacities of the world.

Hectic days for me lately. Just last Sunday midnight, I arrived from Sydney, went straight to the hospital as my wife was scheduled to give birth that day to our second child. I arrived at the hospital around 1:30am of October 4, the baby was born around 4:30am, she's pretty.

I left the hospital early this morning, my wife and the baby are scheduled to check out later today. They should be home by now. Thanks to my mother in law and two sis-in-law, they help watch my family while I am away.
--------

See also:
EFN Asia 1: From HK to Phuket to KL, September 16, 2006
EFN Asia 2: Hayek in Asia, September 20, 2010
Jo Kwong rocks, February 09, 2010