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SANLAKAS National Office:
150 K-6th St.
Brgy. East Kamias
Quezon City, Philippines
Tel.: (632) 433-8377
(632)
Fax: (632) 426-2422
E-mail: [email protected]
A QUESTION OF INTEGRITY, A MATTER OF SOVEREIGNTY
August 25, 2003
Mr. Speaker, Distinguished Colleagues --
Today I rise on a matter of privilege concerning a grave occurrence that affects not only the constituents I represent in this august chamber but the entire Filipino people, now and for generations to come. The New Iloilo Airport Development Project seeks to construct a new international- standard airport that will straddle the towns of Sta. Barbara and Cabatuan in the province of Iloilo. This project is funded from the so-called Obuchi Fund, a Special Yen Loan Project managed by the Japan Bank for International Cooperation (JBIC), with a contract cost amounting to – at the present international value of our lowly peso – approximately 7 Billion Pesos. Being a Special Yen Loan Project, only Japanese construction firms may participate in the bidding processes. That being so, the Department of Transportation and Communications (DOTC) prequalified three joint ventures. Group 1 is composed of the following Japanese firms: Taisei, Shimizu, and Kajima. Group 2 is composed of Obayashi, Sumitomo Construction, and Sumitomo Corporation. Group 3 is composed of Takenaka Construction, Takenaka Corporation, and Itochu Corporation. On 28 March 2003, the Pre-qualification, Bids and Awards Committee (PBAC) of the DOTC held the bidding for the project. While all of the three prequalified joint ventures submitted their respective bids, one of these submissions –-the submission of the Taisei-Shimizu-Kajima group-– was rejected. There were two reasons for the rejection. First, the documents show that one of the members of the joint venture, more specifically Kajima, had written two weeks earlier to the other members that it was withdrawing from the joint venture. For this reason, the official representative of the joint venture wrote two letters --both dated 17 March 2003-- to the PBAC Chairman at the DOTC, Assistant Secretary Rene E. Maglanque, informing him of Kajima's withdrawal and thus amending the joint venture partnership to include merely Taisei and Shimizu. Nine days later, or on 26 March 2003, the same official representative of the joint venture wrote again to Asst. Sec. Maglanque that they are submitting the bid under the original formation of Taisei-Shimizu-Kajima. But the DOTC did not accept the reinstatement of Kajima to the joint venture. In a letter addressed to the Counsellor for Economic Affairs at the Japanese Embassy, Asst. Sec. Maglanque explained why -- “The withdrawal of Kajima Corporation on 14 March 2003 from the Taisei-Shimizu-Kajima Joint Venture resulted to the dissolution of the said joint venture. Up to the time of the bid submission no official information or document was relayed to the DOTC-PBAC that Kajima Corporation was formally recalling its withdrawal from the original joint venture formation. The original joint venture, therefore, remained dissolved when the bids were submitted.” What DOTC was here saying is that Kajima having earlier formally withdrawn from the joint venture, it should first be formally reinstated before the DOTC could recognize Kajima as again part of the joint venture. This first reason for the rejection of the bid submission of the Taisei-Shimizu-Kajima group was procedural. There was second, more substantial reason; one that is actually the cause for Kajima's withdrawal from the joint venture formation. It turned out, Mr. Speaker, that Kajima had been convicted by final judgment by the Japanese Supreme Court of having bribed a former Construction Minister. As Asst. Sec. Maglanque noted -- "The suspension of Kajima Corporation by the Japanese Ministry of Land, Infrastructure and Transport was anchored [on] its involvement in a bribery scandal in Japan which resulted to final judicial criminal convictions." It is thus very clear that Kajima withdrew from the consortium because it had been suspended by its own Ministry from doing business due to the conviction by final judgment of one of its officials who bribed the DOTC's Japanese counterpart. The moment JBIC heard of the rejection of the bid submission of the Taisei-Shimizu-Kajima group, the Japanese bank showed an immediate knee-jerk reaction. Even before the PBAC had wrapped up its deliberations, JBIC sent two of its people to meet with DOTC officials and threatened our officials with a discourtesy reminiscent of its ambassador. The Counsellor for Economic Affairs of the Japanese Embassy also faxed a letter to the DOTC on the same day, 28 March 2003, with interventionism veiled in the statement that "the Embassy cannot acknowledge any Japan ODA-related bidding process which the Embassy finds to be unfairly and inordinately treating any Japanese company." The Taisei group itself sent a letter before the close of day to Asst. Sec. Maglanque protesting the rejection of its bid. The situation, Mr. Speaker, was just like the Japanese invasion of our country in 1940 -- stealthy, swift and merciless. The JBIC, the Japanese Embassy, and the triumvirate of biggest construction firms in Japan led by Taisei ganged up on our DOTC and cajoled it to reverse itself and accept the bid of the Taisei-Shimizu-Kajima group. But the DOTC, like our defenders in Bataan, held fast to its decision to reject the bid of the Taisei-Shimizu-Kajima group for the reasons mentioned earlier. Thus, DOTC issued PBAC Resolution No. 03-06 dated 25 April 2003 affirming the actions taken on 28 March 2003 and seeking concurrence from JBIC. DOTC likewise wrote to the Japanese Ambassador, Kojiro Takano, with a detailed explanation for the actions taken. The Office of the President strongly backed the position taken by the DOTC. As Secretary Marita Magpili-Jimenez wrote to JBIC in a letter dated 23 May 2003: "Though it was the Embassy's position that the bribery case suspension [of Kajima was only in effect in Japan and not in foreign countries, the Government of the Philippines reserves its sovereign right to evaluate and decide on specific contractors who have pending cases or suspensions in foreign countries. Unfortunately, Kajima had an existing suspension in Japan at the time of tender. The Government of the Philippines considers this suspension significant enough to merit such serious action. The basis of the Department of Transportation and Communication's decision is explained well in their letter to you and the Embassy of Japan and in their attached PBAC resolution. "The Office of the President supports the PBAC resolution signed by DOTC Secretary Leandro Mendoza. As we had informed the Embassy of Japan, this suspension shall not be reversed and such is the final position of the GOP." In spite of this, JBIC was adamant in its insistence that the Taisei-Shimizu-Kajima group be included in the bidding process. It refused to accept the perfectly valid and legal explanation of the DOTC, and even the support expressed by the Office of the President. Thus, on 09 July 2003, JBIC wrote a strongly worded letter to DOTC Secretary Leandro Mendoza saying that it “opts not to review the evaluation report” of the bids because the Taisei-Shimizu-Kajima group was excluded. Mitsuru Taruki, JBIC’s chief representative in the Philippines, even went to the extent of saying that “the Bank may opt not to finance the contract”. Here, Mr. Speaker, was a threat that was no longer veiled. This provoked an even more strongly worded response from our DOTC Secretary, the Hon. Leandro Mendoza. Let me, Mr. Speaker, quote from Secretary Mendoza’s letter to JBIC dated 21 July 2003: “[The] most important issue at hand xxx is the fact that a former official of Kajima Corporation (who was an active officer of Kajima Corporation at the time crime was committed) was convicted of bribery that resulted not only to that person’s incarceration but also the suspension of Kajima Corporation during the period when the bidding for this contract was conducted. “The Bank should not take this bribery scandal lightly and force us to disregard this matter altogether. The Bank’s contention that the Philippine Government’s Anti-Graft Policy should be operationalized by DOTC and recognized by the Bank as objective before it can be valid is equally disturbing. DOTC has not penalized or punished Kajima Corporation for violation of Anti-Graft and Corrupt Practices Act, as you claimed. It is a derived conclusion that their conviction in Japan gives rise to the question of the propriety of allowing them to participate in a bidding of a contract, at the time their suspension was on in Japan, going against the Statement of Policy in the Anti-Graft and Corrupt Practices Act. More than anything, these overtures are already stepping on the Sovereign Rights of the Philippine Government to determine what is good and what is not good for the country. In the exercise of these Sovereign Rights, DOTC, in order to protect the interest of the Philippine Government, took a decision that will be most advantageous to the Philippine Government and show its consistent abhorrence of the graft and corrupt practices of any applicant contractor.” Secretary Mendoza went on to characterize the JBIC threat of withdrawing financing for the project as “coercion, which does not sit well in this situation especially since this is not a JBIC-DOTC matter only but a Government to Government agreement which involves your Ministries of Finance, Foreign Affairs, and Economy Trade and Industry and its Philippine counterparts.” Mr. Speaker, no braver words could have been spoken. One could almost feel the fervor and patriotism of the Bataan defenders revivified in the stand taken by our Department of Transportation and Communications, and this privilege speech should have been to sponsor a resolution commending the DOTC for defending our sovereignty. But alas, this is not to be so. Just as Bataan and Corregidor fell to the invading hordes of the Japanese military, so did the DOTC. JBIC did not heed the statements of our DOTC Secretary and insisted that a re-bidding be conducted with the Taisei-Shimizu-Kajima group included. Finally, on 06 August 2003, the same PBAC that rejected the bid documents of Taisei-Shimizu-Kajima sent notice to all of the three prequalified bidders to calling for a “re-submission of bid”. The only reason cited by the said notice is found in the first paragraph, which reads thus: “As per request from JBIC, it has been decided to request re-submission of Bids from the three (3) prequalified Bidders for Construction Works for the” New Iloilo Airport Development Project. This “re-submission of bid,” Mr. Speaker, was scheduled this morning, and may have already come to pass as we speak. Many questions, Mr. Speaker, are raised by the recital of the above factual background. But the most important question is -- Why did the Department of Transportation and Communications, after a gallant stand against the incursions into our national sovereignty and the exercise of the right to reject the bid of an applicant who had been convicted of bribery, suddenly make a complete turnaround and finally accede to the demands of JBIC? This, Mr. Speaker, is a matter which this august chamber must seriously look into. Intrusions into our sovereignty, and the right not to allow contractors with criminal record to participate in government projects, are not to be taken lightly. More so if taken in the light of the vaunted campaign of the Macapagal-Arroyo administration against graft and corruption. It must be emphasized, Mr. Speaker, that cause cited by the DOTC for Kajima’s disqualification was its being convicted by final judgment of the Japanese Supreme Court of having bribed a former Construction Minister. Interestingly, the defense raised by the former Minister was that the funds he received from Kajima Corporation were political donations, not bribes. Which makes us wonder, Mr. Speaker, if the sudden turnaround of the DOTC is connected to the elections scheduled for May 2004 and if political donations are to be made, or already being made. The timing is very suspect, Mr. Speaker. The “re-submission of bids” will include the group to which the convicted briber, Kajima Corporation, belongs. It was scheduled this morning. We have reliable information that the bidding process will be finished and the contract awarded by October so that the fifteen percent (15%) down payment shall be made available by Christmas 2003. Fifteen percent of the contract price, Mr. Speaker, is roughly estimated at 1 Billion Pesos. Mr. Speaker, Santa Claus is coming to town, and Christmas is going to extend to May 2004. The actuations of JBIC and our Government lend credence to the nagging suspicion that the bidding processes at the DOTC for this particular project are nothing but a rigmarole, a sham, an utter fakery. The insistence that the Taisei-Shimizu-Kajima group be included despite acknowledgment of the fact that one of its members had already been convicted of a crime indicates that this is a rigged bidding. It will be a safe bet that the contract for the Iloilo airport project will be awarded to the group that the JBIC and the Japanese Embassy had been strongly favoring. Sa madaling salita, Mr. Speaker, plantsado na ang lahat doon pa sa Japan! Hindi lang ito lutong Macao, kundi parang na-sashimi pa ang bansa natin. E kung ganoon at magkakasabwat na rin lang ang JBIC at ang mga Japanese construction firms, bakit pa nag-bidding sa DOTC? Hindi na lang sana nagmoro-moro at gumastos pa ng pera ng mamamayan. I further raise this issue, Mr. Speaker: Would you allow convicted – or, at the very least, indicted – felons to construct your house just because the bank from which you borrowed the money for the construction insisted that these criminals should do so? I ask this question because the Japanese newspaper The Daily Yomiuri reported on 09 March 2003 that there was another indictment against Kajima Corporation in November 1993, also for bribery. It would appear, Mr. Speaker, that Kajima Corporation is not only a convicted felon but is also a recidivist. What is even worse is that the same report in The Daily Yomiuri also states that: “In a series of scandals involving major general contractors, executives of seven companies, including Kajima, Taisei Corp. and Shimizu Corp., were indicted.” If the news report is to be believed, Mr. Speaker, then the entire joint venture group of Taisei, Shimizu and Kajima have criminal records in Japan. Yet JBIC insists that this venture be allowed to participate in the bidding for the Iloilo airport? Mr. Speaker, there is something very fishy here, and I’m sure it’s not tuna. The House of Representatives should look deeper into this, Mr. Speaker. Based on these facts and the issues I have raised, Mr. Speaker, I formally file a resolution asking the House Committee on Transportation and Communication to investigate the bidding processes being conducted by the DOTC for the New Iloilo Development Project and the insults to our sovereignty that have been hurled by JBIC, including any unwarranted interventions by the Japanese Embassy. I am also including in my resolution, Mr. Speaker, a clause that we urge the DOTC to hold in abeyance any further proceedings in order not to render moot and academic the investigation that may be conducted by the House. Ultimately, Mr. Speaker, this is a question of the DOTC’s integrity and a matter of national sovereignty.
October 8, 2003
Maliliit na Manininda ng Kamaynilaan: Dapat bang Kamuhian o Dapat Tulungan?
A Question of Integrity, A Matter of Sovereignty
August 12, 2003
The People have the Right to know the Truth about the Accusations
July 30, 2003
The Accused can not Lead the Investigation
Copyright © 2003 SANLAKAS All Rights Reserved
