Project description

This is a two-part story on the promises and pitfalls of the multibillion-dollar infrastructure and other business deals that the administration of President Rodrigo R. Duterte has reportedly secured — but have yet to roll out and deploy — courtesy of concessional and tied loans that had been pledged by China.At the close of his state visit in Beijing in October 2016, the President had proclaimed to the world that the Philippines and China were now besties, or the best of friends again. Proof of that rekindled love, he said, was a fabulous figure that his state visit reportedly snared — a total of $24 billion or about PhP1.2 trillion in loans and grants for mostly infrastructure projects of the government, as well as for investment projects that Filipino and Chinese companies plan to launch.By all indications, and according to the secretaries in charge of the negotiations, Beijing’s touted generosity to the Philippines is just a lot of intentions, the agreements signed mere "frameworks for cooperation," and the projects that China has pledged to finance, mere concepts for now.This supposed reboot in Manila-China relations may not happen overnight, or in seamless fashion. Duterte officials acknowledge that there is a long migration path between project concept and actual project deployment and implementation. The tedious process covers the conduct of feasibility studies, review and approval by economic managers, project financing, bidding of supply contracts, and finally, project procurement. Barring kinks, complaints, and scandals that could visit, the entire process may stretch on from 14 to 18 months at best, or from two to three years at worst.In the meantime, senior Duterte officials privy to the talks told PCIJ that brokers in both Manila and Beijing with eyes for quick fix and prize — i.e. contracts, commissions, and related benefits — are even now stalking project talks.While the future of renewed Manila-Beijing ties remains touch-go amid supposedly warming economic ties but also simmering territorial dispute in the West Philippine Sea, the recent past of failed and corruption-tainted projects funded with loans from Beijing continue to haunt negotiations on the new projects.China money and companies had rolled out under then President Gloria Macapagal Arroyo such ignominies as:– The $330-million NBN-ZTE national broadband project that was aborted in 2006 amid allegations of kickbacks sought and received by certain senior officials close to Arroyo; and– The $400-million loan from China Export-Import Bank for the 32-kilometer first section of the North Luzon Railways Corp. (Northrail) project that the Arroyo administration awarded in 2003 to a subsidiary of a China state-owned enterprise or SOE. The project was scuttled in 2012 but Filipinos continue to pay tens of millions of dollars for part of the loans that China had extended for this project which gave Filipinos "nothing, nothing at all," says a Duterte Cabinet official.

What makes this project innovative?

The reports were completed through a collaboration between PCIJ and Kenneth Cardenas, a Filipino PhD candidate in Geography at York University in Toronto, Canada. Cardenas used corporate filings with the Securities and Exchange Commission’s online database as a starting point, and then cross-referenced names and addresses against news stories, Google maps, and publicly-available corporate profiles, with additional research support from PCIJ. Accessing hard-to-get public documents, spreadsheet and SQL skills, and most importantly, shoe-leather reporting, helped complete the reports.

What was the impact of your project? How did you measure it?

The China deals report was one of PCIJ’s top stories of 2017, shedding light on the potentially risky “deals” that the Philippine government plans to take on with China. The stories were syndicated to major online news websites, both local and national. The stories also got fairly high online engagement, by volume of shares, likes, and retweets on Facebook and Twitter.

Source and methodology

Cardenas and the PCIJ used corporate filings with the Securities and Exchange Commission’s online then cross-referenced names and addresses against news stories, Google maps, and publicly-available records from the Philippine Government Electronic Procurement System, Department of Trade and Industry, and the National and Economic Development Authority. The reports were also informed by extensive interviews with relevant subjects and officials of the finance and budget departments in the Philippines.

Technologies Used

Apart from spreadsheets, PCIJ used Navicat to be able to run SQL queries to efficiently search large procurement datasets.

Project members

Malou MangahasCecile Balgos Kenneth CardenasKarol IlaganJohn Antiquerra

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