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Walang blackmail! DOF claims China not demanding WPS deal as quid pro quo for delayed $24B in loans, grants

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The Department of Finance (DOF) on Wednesday denied that China has delayed the release of billions in promised grants and aid to the Philippine because of President Rodrigo Duterte’s reluctance to sign a join exploration deal in the West Philippine Sea.

“The topic of joint (oil) exploration was never raised in our discussions with our counterparts, particularly during loan negotiations and processing of new loans, even during the bilateral meetings/high-level meetings with this office,” it said in a statement through the office of Finance Assistant Secretary Antonio Lambino II.

DOF issued the statement to debunk false claims published online about a Chinese embassy official supposedly using China’s offers of loans and grants to force the Philippines to agree to a joint exploration deal in the West Philippine Sea.

“This is a grossly malicious claim without any basis,” the DOF said. “There is no link whatsoever between the Chinese loans and grants and the proposed joint oil exploration deal between the two countries.”

POLITIKO ( reported that China has canceled a number of infrastructure loans and grants to the Philippines that were supposed to be signed during the visit of China President Xi Jinping next month.

Zhao was apparently using these billions in loans and grants as leverage to force Duterte to agree to a joint oil exploration deal in the Recto Bank inside the West Philippine Sea.

The talks have been stalled as Duterte has stood firm in not relinquishing majority control of the project as it would mean surrendering part of the country’s sovereignty to China.

DOF claimed that big-ticket infrastructure and development projects to be rolled out by the Philippines in cooperation with China are proceeding as discussed during the regular high-level meetings between the two countries, with an initial three loan accords due for signing before the year-end.

The DOF added that technical discussions on the loan agreements to be signed between the two countries are ongoing, with delays encountered “mostly due to our (the Philippine government’s) internal processes.”

“In fact, the proposed infrastructure projects we are undertaking with the cooperation of China, all go through a very stringent process of approvals to ensure that they comply with the Government Procurement Act and other applicable laws,” the statement said.

To date, the Philippines has signed four grant agreements totaling 1.25 billion renminbi (about $198.77 million) to finance projects and feasibility studies for various infrastructure projects.

Under the 500-million-renminbi grant signed last April, about 110.33 million renminbi ($17.55 million) had been allotted for the project feasibility studies of the Davao City Expressway Project and Panay-Guimaras-Negros Island Bridge Project to be implemented by the Department of Public Works and Highways.

Moreover, during the High-Level Meetings between the Philippines and China held in Beijing last August, an indicative list of 12 infrastructure projects proposed for feasibility study assistance was submitted to the Chinese government for its consideration.