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Primer on ZTE-NBN Deal English Version

Primer on ZTE-NBN Deal English Version

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Published by api-3718467
All you need to know about the ZTE-NBN deal scandal
All you need to know about the ZTE-NBN deal scandal

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Published by: api-3718467 on Oct 14, 2008
Copyright:Attribution Non-commercial


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A Primer on the Anomalous National Broadband Network Project
And other disgusting Illegitimate Deals and Debts
Freedom from Debt Coalition
What is the ZTENBN deal?

It is a $ 329 million loan from the China Export and Import Bank to finance the infrastructure project between the Philippine Government and the China-based Zhong Xing Telecommunication Equipment Company Limited (ZTE). The said project aims to develop a telecommunications infrastructure that will deliver voice, data, and internet services to all government offices and munic ipalitiesnationwide.

However, the said project encountered serious accusations of fraud, bribery and other anomalies forcing the Arroyo Government to suspend it \u201c indefinitely\u201d last September 22, 2007. But due to the public's continued and strong outcry over the project, Mrs. Arroyo wasforced to cancel the ZTEdeal last October 2, 2007.

Why is it Illegitimate?
Allthe necessary elementsto make thisdealillegitimate are present.
For one, there is no existing financial analysis and plan for the said project.

The implementing agency is blind to any feasibility studies and has not initiated any detailed engineering studies, plans, specificationsand design forthe said broadband project.Thisentire aspect wastasked to ZTEalone. Secondly, it suffers from a crisis of transparency. It is alleged that there is a lack of competitive bidding which led to the overpricing of the project so as to include the cost of the so-called commissionsinto the project cost.


Thirdly, the loan project comes with one-sided conditionalities. The loan granted by the China Export Import Bank wastied to the purchase of services and technology also from China (read: ZTE).

Lastly, it suffersfrom a crisisof relevance. The question is, do we really need it in
the first place?

The government already owns two broadband networks\u2014the Philippine Administrative Network Project (PANP) supposedly to modernize our government's news and information network and the Philippine Research, Education and Government Information Network (PREGINET) tasked to interconnect academic institutions, government offices and research and development centersin the country.

Again we ask: do the already debt-burdened people really need to take anotherunnecessary if not illegitimate debt fora project we do not need in the first p la c e ?

Asof the moment, the National Government debt isP3.7 trillion wherein every Filipino isshouldering P 42,819 each for debtsthat are widely perceived to be illegitimate.

Illegitimate debtsare those that involve any ora combination of the following --
Fraud and deception
Lackof compliance with democratic processesorlegalrequirements
Grossly disadvantageoustermsand/oronerousand harmfulconditions
Financing of failed projects,orprojectswith damaging effectson people,
on the environment,oron the economy
Purchasing overpriced,unnecessary goodsorservices
Support of policiesthat result in the violation of human rights,
Accumulation due to unjust economic relations

Aggressive and unscrupulouspushing by lendersto promote their vested interests at the expense of the borrowers or the people who will pay the debts

Transactionsby illegitimate regimes
We believe the majority of the public debtswe are paying forare illegitimate.
Examplesof illegitimate dealsand debtsare:
$ 406 million Cyber Education Project
P503.65 million Austrian Medic al Waste Projec t
$ 100 million World Bank Textbook Loan Project
$ 503 million North Luzon Railways Projec t
$ 884 million South Luzon RailwaysProjec t
$ 165 million Telepono sa Barangay Project
P858 million Philippine Merchant Marine Academy Modernization
$ 121.8 million World Bank Small Coconut Farmers Development
What are illegitimate debts?

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