MWSS rebuts but probe on
Clearly, the government approvals to the loan agreement were secured in full coordination with all concerned agencies
No shortcut has been made in the New Centennial Kaliwa Dam project as the Metropolitan Waterworks and Sewerage System
(MWSS) assured yesterday the bidding process for the P12-billion project met all requirements including a “special authority from the President.”
Despite the MWSS assurance, however, Malacañang said it will review the Commission on Audit’s (CoA) report questioning the selection of the contractor for the deal.
In an Audit Observation Memorandum sent to MWSS, CoA reported that the China Energy Engineering Corp. Ltd (CEEC) already conducted preliminary activities even without government’s approval and two out of three shortlisted Chinese contractors were approved by the technical working group despite their non-compliance with MWSS minimum requirements.
MWSS said in a statement that among the documents it had obtained were the Monetary Board approval of the loan between MWSS and Export-Import Bank of China; Department of Finance (DoF) approval-in-principle and willingness to guarantee paper; DoF certification of internal government approval required to deliver and execute the loan agreement; Bureau of Treasury certification; signed preferential buyer’s credit loan agreement; and signed letter of guarantee.
“Clearly, the government approvals to the loan agreement were secured in full coordination with all concerned agencies to implement this flagship project which is part of MWSS Water Security Program,” according to the statement.
Duterte provides kick
MWSS noted that the project was conceptualized in 1967 but “it is only the administration of President Duterte that has taken bold and decisive action” in ensuring its swif t implementation.
It said the project will benefit Metro Manila residents who are reeling from yearly water shortages at the height of the dry season.
The water service regulator ceded that a pre-condition to loan effectivity has yet to be submitted which is the environmental compliance certificate (ECC). The Department of Environment and Natural Resources-Environmental Management Bureau has been holding hearings with the MWSS for the ECC, according to MWSS.
The MWSS assurance will not preclude an investigation, according to the Palace which promised to go through the report of the CoA “and then look at the contract.”
President Duterte’s spokesman Salvador Panelo said, however, the final say on the long-delayed project will be from President Rodrigo Duterte.
In December 2018, the contract for the dam project was awarded to CEEC Ltd.
The China-funded project in Quezon province is expected to provide an additional 600 million liters a day of water to Metro Manila and nearby provinces.
The multi-billion water project was first approved by the National Economic and Development Authority (NEDA) on 29 May 2014 and on 27 June
2017 the
The flagship project is part of MWSS Water Security Program
project’s financing scheme shifted from Public, Private Partnership (PPP) scheme which was hard to obtain to securing Overseas Development Assistance (ODA) funds.
Some groups have rejected the construction of the Kaliwa Dam, saying it would displace indigenous peoples.
No debt trap
Instead of allegations of being buried in debt as a result of the project, the government will save as much as P4.2 billion in the construction of the dam through an ODA loan from China compared to financing through commercial debts.
DoF Assistant Secretary and spokesman Tony Lambino explained that the construction of the Kaliwa Dam has been a government proposal since 1970s but it somehow never materialized.
He said several proposals were made on the manner of financing for the project that included an unsolicited PPP (public-private partnership) scheme which were all thumbed down by authorities.
With the shift in the financing mode, Lambino said the government will have “significant” savings from the original estimated cost.