The Senate is poised to look into the terms of a loan agreement with China that the Duterte administration intends to tap to bankroll its $167-billion infrastructure program.
In pressing for the Senate inquiry, Sen. Leila M. de Lima said the congressional review was “necessary”, amid concerns that the loan agreement could “put the country in dire debt
or force the country into commitments undermining the Constitution or its sovereignty”.
The senator sought the inquiry through Senate Resolution 377, even as she noted that, while the government needed to stimulate the economy, “there is an even greater need for our economic managers to exercise extreme caution before advising our President to enter into any loan agreement of this magnitude”.
She asserted the need for the Senate review “lest we end up with a debt that our children, our children’s children, and even several generations thereafter will not be able to repay, and with commitments that would violate the Constitution or undermine our sovereignty”.
De Lima echoed international concerns aired over “the danger of long-term onerous indebtedness among allied countries under the China-espoused “Belt and Road Initiative” (BRI).
She noted that the BRI aims to connect countries of Asia, Europe and Africa with each other, primarily through infrastructure projects that are to be financed, in part or in whole, by China, such as ports, roads, railways and bridges, adding that “some countries, such as Mongolia, Venezuela and Sri Lanka, had to resort to desperate measures to renegotiate their loans with China.”
De Lima also cited, for instance, that “Mongolia had to sell coal to China for only 11 percent of the international market price, Venezuela had to ask for more onerous loans from Russia, and Sri Lanka had to offer debt-for-equity swaps to China over infrastructure projects.” She said “the principles of transparency and accountability dictate that the terms of any loan agreement that have the potential of undermining our sovereignty and of mortgaging our children’s future be subjected to extreme scrutiny.”
“It is the duty of Congress to keep the Executive department in check, through the investigation of, and meaningful legislation on financial and economic policies that could affect our country well beyond the current administration,” de Lima added.