POSTSCRIPT / December 17, 2002 / Tuesday


Philippine STAR Columnist

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Erap okayed Impsa deal, but rejected $14-M offer?

EMBARRASSING DOCUS: Former President Erap Estrada better look for an excuse to detour from his Senate date today and instead proceed to that healing bath prepared for him by nuns in Novaliches.

Erap is in for some embarrassing revelations at the hearing of the Senate committee on public enterprises that invited him to testify on a power contract of the Argentine firm Industrias Metalurgicas Pescarmona Sociedad Anonima (Impsa).

The advance information is that some members of the committee chaired by Sen. John Osmena plan to use the hearing to embarrass President Gloria Macapagal Arroyo and her husband Miguel with innuendoes on alleged bribes involving the project.

As the administration has done its homework on the Impsa contract (to build, rehabilitate, operate and transfer [to the government] the Caliraya-Botocan-Kalayaan (CBK) hydroelectric plant in Laguna), it is itching to turn the tables on Erap.

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WHERE’S THE $14M?: Erap has repeatedly claimed that he was offered $14 million to approve the contract. When documents are submitted to the Senate showing that he had approved it, the question would be: Did Erap receive the $14 million offered in exchange for his approval?

We dare say that most men in the street and every student of corruption in the bureaucracy will find it unlikely that Erap rejected what appears from his statements to have been an unsolicited gift.

But only Erap is saying that he was offered $14 million. This claim has not been corroborated by any direct witness.

Impsa itself says that it has neither offered nor given any bribe to anybody for the CBK project. With both the alleged giver and the supposed receiver (Erap) denying the alleged bribery, what is there left for the Osmena committee to do?

What Osmena can do is wring testimony or innuendo from witnesses, including Erap, that the $14 million eventually went to the Arroyo administration. But that would require proof, which we do not see forthcoming.

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ERAP OKAYED DEAL: Administration officials are set to submit to the Senate documents showing among other things that then President Estrada had signed and approved the Impsa contract.

Erap has told us that he signed the Impsa papers, but clarified that it was just to authorize the proper Cabinet officials to follow through and do whatever was necessary to complete the requirements.

Documents released to media by the justice department in anticipation of the Senate showdown on the Impsa contract showed that:

  1. On Nov. 6, 1998, then President Estrada signed as witness to the signing of the contract between Impsa and the National Power Corp. (Napocor).
  2. On Feb. 10, 2000, he signed a “full powers” authorization for Napocor president Federico Puno to “make, execute, endorse and deliver” any document that may be needed to carry out the contract.
  3. On Sept. 25, 2000, Puno asked for a Government Acknowledgment and Consent Agreement (Gaca) — a guarantee that the government would assume Napocor’s obligations in case the power firm could not pay its obligations. Mr. Estrada executed another full powers authorization to the finance secretary to “conclude, sign and deliver” the Gaca. The Gaca was issued.

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NAPOCOR PURGE ON: President Arroyo, meanwhile, has started the top-level cleanup of Napocor and an allied firm. Mismanagement and some corruption have been blamed for the continued incurring by Napocor of huge losses.

To be removed effective Feb. 1 next year are acting Napocor president Roland Quilala, who will be replaced by Rogelio Murga of Engineering Equipment Inc.; and president Asisclo Gonzaga of Napocor’s sister company National Transmission Corp. (Transco), who will be replaced by Alan Ortiz.

One big racket exposed by Napocor insiders is the collection of multi-million-peso commissions from the centralized purchase of fuel for coal-fired power plants. Independent power producers (IPP) are required to source their coal only through the Napocor.

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JIMENEZ DENIES BRIBERY: Opposition senators have not presented proof for their charge that the $2-million that was allegedly given Justice Secretary (on leave) Hernando Perez by Manila Rep. Mark Jimenez was part of the alleged $14 million payoff on the Impsa deal.

In fact, Sen. Panfilo Lacson, who was the first to charge that the $14 million went to administration officials is just relying on Jimenez to produce the evidence.

But Jimenez is careful not to get embroiled in the Lacson charges. He said that the $2 million he had wired to a Coutts Bank account in Hong Kong for Perez was not related to the Impsa deal, but was extorted from him by the justice secretary.

With Jimenez issuing a blanket denial, it would be interesting to watch how the Osmena committee could link the First Family to the alleged $14 million payoff.

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PEREZ A LIABILITY: There is, meanwhile, a growing feeling even among key administration officials that Perez just resign and not drag the Arroyo administration with him.

Senate President Franklin Drilon, for one, says that it would be best for Perez to resign instead of reclaim his post after his one-month vacation. His views are shared by Arroyo loyalists who say that the serious accusation against Perez has had negative effects on the President’s approval rating in the surveys.

Perez has become ineffective and will continue to be a liability of the administration if he stays. We suggest that he goes on terminal leave or resign outright if the President cannot bring herself to firing him.

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OPEN THAT ACCOUNT!: We think President Arroyo can settle the question once and for all by ordering immediately the start of official communications with the Hong Kong government for the opening of Coutts Bank account where Jimenez claimed to have wired the $2 million for the justice secretary.

The President and her justice secretary should have nothing to fear if she or both of them have no secrets hidden in the Coutts Bank.

The longer the President refuses to have the bank account opened, the more she would suffer in the surveys. She cannot continue to protect or appear to protect Perez as this apparent coddling has its mounting political costs.

Recall that then President Estrada suffered a big political fall when the senators supporting him in his impeachment trial refused to open a controversial second envelope containing documents from the Equitable Bank linked to Erap.

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NOT A TREATY: Can the Philippine government ask the Hong Kong government to carry out the provision in their mutual assistance agreement for securing bank information without is being ratified first by the Senate?

Yes, we think so. Only treaties are required under the Constitution to be ratified by the Senate. The RP-HK pact is not a treaty, but a mere executive agreement that does not require ratification.

Treaties are signed between sovereign states. Hong Kong is not a sovereign state but is only an administrative region of China. The agreement was not signed with China but only with Hong Kong.

We urge President Arroyo to set the administrative ball rolling toward getting Hong Kong cooperation in opening that Coutts Bank account where $2 million was allegedly wired by Jimenez for Perez — and get it over with.

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(First published in the Philippine STAR of December 17, 2002)

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