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Tuesday , January 28 2020

Duterte orders prosecution of 2 utilities over contracts – ‘Martial law can end’

MANILA, Dec 5, (Agencies): President Rodrigo Duterte on Wednesday ordered the filing of criminal charges against the Philippines’ two biggest water utilities and demanded new deals to replace contracts “onerous and disadvantageous” for ratepayers, his spokesman said.

The firebrand Philippines leader acted after utility firms Manila Water Co Inc and Maynilad Water Services Inc have won arbitration cases in Singapore against the government. “A review of the agreements with Manila Water and Maynilad reveals that they are contrary to public policy and public interest, the same being onerous and disadvantageous to the people,” presidential spokesman Salvador Panelo said.

He said Duterte had ordered the filing of criminal, civil and administrative charges against everyone involved in the utility contracts, including the billionaire company owners and public officials for alleged economic sabotage.

Duterte had tasked agencies to draft new utility contracts acceptable to the government, he added in a statement. In April, Duterte ordered a review of all government contracts with companies and other countries to ensure they were fair to ordinary Filipinos.

Shares in Manila Water dropped 4.8% on Wednesday while Maynilad stockholders Metro Pacific Investments Corp and DMCI Holdings Inc fell 10.7% and 3.9% respectively. Japan’s Marubeni Corp owns a minority stake in Maynilad.

The Permanent Court of Arbitration in Singapore this month ordered the Philippine government to pay Manila Water 7.4 billion pesos ($145 million) to recoup foregone revenues from rate increases that were rejected by regulators. Maynilad won a separate arbitration last year.

The two firms argued that the rate hikes were necessary to improve utility service coverage and water pressure in homes. “The arbitration award issued in our favour is for acts in breach of the procedure committed by officials of the previous administration, not the Duterte administration,” Manila Water said in a statement, adding that it was willing to cooperate with Duterte’s government. Manila Water serves seven million customers through a concession valid until 2037.

Maynilad, which caters to 9 million customers, was not immediately available for comment. Filipinos are drawn to Duterte’s no-nonsense, manof- the-people style. But his centrepiece policy – a war on drugs – has caused international alarm over what UN experts have called a “staggering” number of illegal killings by police, who say they shot thousands of drug suspects only in self-defence.

Martial law in south can now end’
The Philippine defense chief said Wednesday he recommended that President Rodrigo Duterte not extend martial law in the country’s south, where it was imposed in 2017 to help troops quell a bloody siege by Islamic State groupaligned jihadists in Marawi city.

Defense Secretary Delfin Lorenzana said he told the president on Wednesday that Muslim militants have been weakened considerably and are no longer able to carry out an attack like the Marawi siege. Duterte has extended the martial rule three times and it is due to expire at year’s end. There was no immediate reaction from the president.

“The Armed Forces of the Philippines believes that the Maute group and other threat groups can no longer launch a Marawi-type attack as their forces and capabilities have significantly dwindled,” Lorenzana said, referring to one of the IS-linked groups blamed for the attack in the Islamic city.

Troops have also made significant progress in efforts to defeat the decades-old communist insurgency, Lorenzana said. Duterte placed the entire southern Mindanao region under martial law after hundreds of local militants, backed by foreign fighters, occupied buildings, a commercial district and communities in Marawi starting May 23, 2017, in the worst security crisis he has faced.

The attack reinforced fears in Southeast Asia that the Islamic State group was gaining a foothold in the region despite its battle setbacks in Iraq and Syria. Backed by US and Australian surveillance aircraft, troops quelled the siege after five months of intense airstrikes and ground offensives. The government successfully received congressional approvals to extend martial law in the south, saying surviving militants continued to recruit new fighters and plot bombings and other attacks.

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