Onerous daw? FVR: Terms of contract with Maynilad, Manila Water ‘most favorable’ to gov’t
Former President Fidel V. Ramos has defended the contract that his administration signed with Maynilad Water Services Inc. and Manila Water Co. Inc., which President Rodrigo Duterte called “onerous.”
The Philippine Daily Inquirer reported Saturday (December 13) that Ramos wrote Duterte a letter explaining what led his administration to privatize water distribution in Metro Manila.
In a letter dated December 4, the former President said the concession agreement was borne out of the need to solve the “water crisis” which gripped Metro Manila in 1997.
Ramos maintained that his administration had public interest in mind when it negotiated the contracts.
“The MWSS (Metropolitan Waterworks and Sewerage System) concession agreement, as with all projects and agreements entered into by government during my administration, was anchored on complete staff work, review and consultation with various government agencies, organizations and the concerned public, which resulted in complete transparency all the while negotiating terms most favorable to government,” he said.
The privatization transferred the responsibility of distributing water from MWSS to the Ayala-owned Manila Water for the east zone, and the Lopez group’s Maynilad for the west zone. The Metro Pacific Investments Corporation owned by Indonesian oligarch Anthoni Salim took over Maynilad in 2008.
Ramos said his administration was able to convince private companies to invest in water distribution by giving them the government’s guarantee that it will honor the contracts.
“To achieve all this, the private sector mobilized funding from both foreign and local sources depending on the word of the Philippine government that the essential conditions of adherence to the sanctity of contracts and rule of law must be observed,” Ramos said.
Stressing the importance of honoring contracts, the former President added: “These are the pillars that hold together any agreement, be it between governments and/or the government and the private sector. Our word must be our bond.”
Duterte has been lashing out at Maynilad and Manila Water over the supposed lopsided concession agreement. He vowed that the government will not pay the nearly P11-billion arbitral awards they won from a Singapore court.
Acting on Duterte’s orders, MWSS recently revoked the extension of the water concessionaires’ contract until 2037. The agreement is set to expire in 2022.