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ASIA-based civil-society organizations have urged Group
of Eight (G-8) countries to cancel all illegitimate
debts contracted by developing countries like the
Philippines.
The G-8
is an international forum for the governments of Canada,
France, Germany, Italy, Japan, Russia, the United
Kingdom and the United States.
The
Jubilee Southasia Pacific Movement on Debt and
Development (JS-APMDD) stressed that debt is a global
problem affecting almost 100 countries in the world—from
Africa, Latin America and the Caribbean and Asia and the
Pacific.
“Illegitimate debts involve the gross violation of basic
assumptions of debt contracts, as well as widely
accepted ethical, social, political, economic, [and]
environmental values, standards and principles. They
cause harm to the well-being of the people and
communities in whose name the debts were incurred and
who are the ones paying for these debts,” JS-APMDD
coordinator Lidy Nacpil said in a statement.
According to JS-APMDD, these violations can be found in
any one or combination of the following: circumstances
surrounding the contraction of the debt (can be
immediate, can also include a broader, historical
context); the nature of the contracting parties
themselves; the relationship between the contracting
parties (and the imbalance of power which shapes the
financial transactions and relationship); the terms and
obligations of the contracts; the implications and
impact of attendant conditionalities; how the funds
were used; and the impacts of servicing these debts.
“The G8
governments bear part of the responsibility for much of
the illegitimate debts claimed from developing
countries—as lenders of bilateral debts and as major
shareholders of international financial institutions
like the World Bank, the International Monetary Fund and
the Asian Development Bank,” stressed Nacpil.
Freedom
from Debt Coalition (FDC) secretary-general Milo
Tanchuling said that as of 2007, the Philippines has a
total of $6.23-billion debts claimed by G8 countries.
This,
Tanchuling said, is 45.6 percent of the country’s total
debt, excluding bonds issued by the national government.
Of the total amount, around $5 billion, or 39 percent,
is claimed by Japan alone.
In a
public forum in Japan, where the G8 Summit was held, the
“illegitimate debt” cases of the Philippines and
Bangladesh were presented by JS-APMDD.
The
cases presented were the San Roque Multipurpose Dam and
the Bohol Irrigation Projects in the Philippines.
The
$1.2-billion San Roque project was constructed in the
mid-1990s. The design showed there was an irrigation
component that could provide water to about 87,000
hectares of rice fields in Pangasinan and Tarlac.
The dam
was completed in 2002 without the irrigation component.
The project was funded by the Japanese government
through the Japan Bank for International Cooperation (JBIC).
Meanwhile, the controversial Bohol Irrigation Project,
Stage II (BHIP II) was deemed valid and legal by the
Department of Justice (DOJ) in the opinion it sent to
the National Economic and Development Authority (Neda)
last year.
The BHIP
II is a foreign-assisted project financed by JBIC under
a loan agreement entered into by the Republic of the
Philippines and the JBIC. It involved the construction
of the Bayongan Dam and Appurtenant Facilities (C1), and
construction of the irrigation canals and appurtenant
structures (C2).
The
agency budget for C1 was set by the National Irrigation
Administration (NIA) at P1.165 billion, while C2
amounted to P461.763 million.
The DOJ
ruled that the project is not covered by the
Implementing Rules Part A of Republic Act 9184, or the
Government Procurement Reform Act, since the invitation
to bid for the project was made before the effectivity
of IRR-A of RA 9184.
Before
the DOJ opinion, the Neda said the NIA’s request for a
P1.246-billion cost increase in the P2.384-billion BHIP
II is too big for the national government to bear,
according to former Neda director general Romulo Neri.
Neri
said the NIA proceeded to implement the project at
higher cost without first seeking approval from the
Investment Coordination Committee, as required of all
official development assistance-funded projects
undertaken in the country.
The Neda
directed the ICC to determine who is responsible for the
cost overruns for BHIP II. The ICC has stood firm on its
demand for someone or some agency to take responsibility
for the huge cost escalation. |
