Abalos tied to NBN deal

Solon cites many trips to China for golf, sex

By Norman Bordadora, Nikko Dizon
Last updated 02:01am (Mla time) 08/30/2007

MANILA, Philippines — Commission on Elections Chair Benjamin Abalos Sr. may have played a key role in the ZTE Corp. of China bagging the country’s national broadband network (NBN) project with a $329-million bid, an opposition congressman Wednesday said.


“Apparently, Chairman Abalos’ unofficial trips to China courtesy of ZTE and his golf games with the officers of ZTE can hardly be characterized as just friendly and totally innocuous. He was a man on a mission,” Nueva Vizcaya Rep. Carlos Padilla said in a privilege speech.


“Could it be that that mission is worth P15 billion?” he asked. The NBN project would connect all government offices.


Padilla said Abalos played golf with executives of the Chinese telecommunications firm in Shenzhen and in Mandaluyong City where the Comelec chair once served as mayor just “weeks before April 2007” when the contract was signed.


Padilla cited a column by Jarius Bondoc in the Philippine Star on an unnamed election official who reportedly negotiated the NBN deal while he played golf and had sex with women in Shenzhen.


“If this matter is investigated by the House, I suggest that this be made a required reading of the members of the House,” Padilla said.


Abalos laughed off the allegation that he was the Comelec official who acted as a conduit between the government and ZTE to seal the NBN deal.


On the phone, he was full of mirth as he said: “I feel flattered. I didn’t know I am that influential.”


Abalos said he could not imagine himself as someone who could influence members of the Cabinet like Transportation Secretary Leandro Mendoza, Trade Secretary Peter Favila and Justice Secretary Raul Gonzalez.


Wishful thinking?


Abalos also heartily laughed when he said he “wished” he could be the person, who was mentioned in the newspaper column as someone with the “sexual prowess” to handle two women in one day.


“That would make my wife very happy. You know, I am not at all affected by these allegations. It’s really laughable. One [partner] in the morning, and another in the evening?” he said, chuckling.


“At my age, I am already 73, why would I do that?” he added.


Ready to face probe


Nonetheless, Abalos said he would face whatever investigation Padilla or the House of Representatives would initiate.


On April 21, 2007, which was covered by the election period during which no government contract should be signed, Mendoza and Yu Yong, ZTE vice president, inked the $329-million deal in ceremonies witnessed by President Gloria Macapagal-Arroyo in Boao, China.


Asked if the ZTE contract was legal even if it was signed at the height of the election campaign, Abalos said it would have to be looked into.


“We can’t immediately say if it’s allowed or not because we don’t even know if that is just an understanding or a contract. We have to see it first,” he said.


Two other companies — Amsterdam Holdings Inc. (AHI) and US-based Arescom — came up with proposals of $240 million and $135 million, respectively, to undertake the NBN project.


Padilla said the Filipino firm AHI submitted an unsolicited bid under the Build-Operate-Transfer (BOT) Law to the Department of Transportation and Communications (DOTC) but the offer was set aside “despite the fact that under the BOT Law, the agency concerned is mandated to review the BOT proposal within a fixed period.”


E-Procurement Law violated?


Padilla said the E-Procurement Law was also violated because the award in favor of ZTE failed to go through an “honest-to-goodness” bidding process.

“There was no competition, no fight, nothing that would have ensured that the Filipino people will get the most of the taxes they are always constrained to cough up,” he said.


Padilla said the representative of AHI, which proposed to undertake the NBN through the BOT scheme, was asked to withdraw its unsolicited proposal to the DOTC.


Unofficial trips


Padilla said that weeks before the ZTE-NBN deal was signed, Abalos traveled unofficially to China.


“According to sources, ZTE Corp. paid for the hotel accommodations of Abalos. It was then unclear why Abalos was traveling to China, why he was doing so unofficially, and why ZTE Corp. was apparently sponsoring his trips,” the lawmaker said in his speech.
“On several occasions earlier this year, Chairman Abalos was also seen playing golf with officials of ZTE at a golf club in Mandaluyong City and in Shenzen, China. Obviously, this was more than a mere coincidence,” he added.


Padilla said Assistant Secretary Lorenzo Formoso III of the DOTC made up the story about the ZTE-NBN contract getting lost with four other agreements signed in Boao.


He said Formoso made the claim before a round-table discussion at the Ateneo Professional Schools in Makati City.


“Probably taken aback by the reaction of those present … (Formoso) almost immediately declared that there was no need to worry. He promised to make available copies of the reconstituted pertinent agreement,” the lawmaker said.


Contrary statements


Contrary to Formoso’s announcements, Padilla said Presidential Legal Adviser Sergio Apostol said the NBN project would not push through because there was no contract.


Favila, for his part, also said that what was signed in Boao was a memorandum of understanding (MOU) and not a contract with ZTE.


“The day after (Apostol’s announcement) Mendoza and Formoso in an interview with the Inquirer practically made liars of Favila and (Apostol) when they declared that an MOU and supply contract with regard to the NBN had, in fact, been executed between the government and ZTE,” Padilla said.


Padilla noted that Mendoza and Formoso earlier said that the contract had been reconstituted.


“Mr. Mendoza and Mr. Formoso lied. The Department of Justice reviewed the transaction not the agreements,” Padilla said.


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