Government Infrastructure News Analysis

Figment of the facts

President Rodrigo Duterte’s bold foreign-policy realignment towards China and away from the US
President Rodrigo Duterte’s bold foreign-policy realignment towards China and away from the US

Behind the scenes, as critics continue to pour cold water on Philippine President Rodrigo Duterte’s bold foreign-policy realignment towards China and away from the US, Mainland companies are already involved in the Philippines on the ground.

“Some Philippine companies have already partnered with Chinese counterparts willing to get involved in major infrastructure projects. China has been very supportive and we’re very thankful for their support,” Department of Public Works and Highways (DPWH) secretary, Mark Villar said on Monday in Beijing.

He added that the Chinese Government has also been assisting in feasibility studies for major road and bridge projects in which Chinese companies will later participate. “We’re looking forward to a very fruitful relationship,” he said. In short, contrary to what the doubters have been saying, the Mainland is already showing its commitment to helping to build the Philippines’ infrastructure.

Villar was among the Philippine delegation attending the One Belt One Road Summit, the mega forum held in the Chinese capital at the beginning of the week to put more flesh on the bones of the biggest transcontinental trade and infrastructure project mankind has ever undertaken. Its aim is to link Asia, Africa and Europe via a network of roads and railways, ports and shipping routes.

Prior to this event, the doomsayers were out in force. For them it had all the right elements; all the right targets – China and Duterte, two entities they never tire of criticising.

Writing in Forbes magazine on 13 May, correspondent Anders Corr had this to say: “The Philippines is at a crossroads. Duterte and his political allies are seeking billions in loans at unknown interest rates from China, whose companies stand to benefit by offloading idle Chinese industrial capacity to build costly infrastructure for which no proper cost-benefit analysis has been done … The Philippine people must be forewarned about the dangerous China deal. Buyer beware. Caveat emptor”.

Corr offers no evidence to back up that outrageous statement. We very much doubt that he’s visited the Philippines lately to actually see what’s happening there; to talk to local industry, businessmen, entrepreneurs, chambers of commerce members, exporters, farmers and so on. As far as Corr’s coverage is concerned our advice is Reader beware, Caveat lector.

This isn’t serious analysis, it’s propaganda. Last month in Forbes he was writing about the Philippine president again; this time with another entity of Western-media hate, Russia. That piece – ‘Duterte Of The Philippines Plays With Russian Fire’ – effectively says that if Duterte forges close bilateral relations with Russian President Vladimir Putin, he’s making a pact with the Devil. More of the lame.

We wonder why the Philippines has suddenly become such a focus of interest for Corr, the founder of New York-based “research provider” Corr Analytics. Certainly he’s not pulling any punches; how about this extract from his latest Duterte hit piece…

“Duterte and his influential friends and business associates could each benefit with hundreds of millions of dollars in finders fees, of 2-7% for such deals. Duterte reportedly sought to fast track some deals, and has publicly mooted the possibility of declaring martial law for a wide range of issues, including drugs, traffic, and the situation on Mindanao. Debt imposed on the public through corruption, fast-tracking or under martial law should be considered odious debt, and not repayable”.

What he’s doing in this article is raising the spectre of Philippine debt which, according to his analysis – apparently based largely on guesstimates of the interest rates on loans – could reach US$450 billion. “Dutertenomics [Duterte’s economic policies], fueled by expensive loans from China, will put the Philippines into virtual debt bondage if allowed to proceed,” he wrote.

Coming up with numbers just to make a case is not our idea of analysis, but if Corr wants to write about a real debt story he has one right on his doorstep. US national debt is presently approaching US$20 trillion. Now that’s a story.

He also seems to base his ‘analysis’ on the assumption that the US$167 billion which Duterte has pledged to spend to ‘Build! Build! Build!’ over the course of his term is all coming from China – no other country is mentioned in the article – which he describes as “the most likely lender”.

But, of course it won’t be. China had committed just US$19 billion towards a number of infrastructure projects which are expected to start very soon. That leaves US$148 billion to be found. Finance Secretary, Carlos Dominguez, addressed this while at the One Belt One Road Summit. “The Philippines is going to fund the projects in our own way. We welcome help from China, but that is not the main source of the funding,” he said.

This was underscored by Benjamin Diokno, secretary of the Department of Budget and Management who said this: “We do not stick to one country. We are not totally dependent on China for development, but we welcome any help”.

Corr’s article is beyond speculation; it’s close to defamation. By posing a ridiculous hypothesis – which is what this is because there are no facts to support such claims – Corr is seriously undermining the president’s standing in the country. And while Forbes has a negligible readership in the Philippines, it could deter investors.

Oddly, we’ve not seen an article from him yet warning the Filipino people to be wary of Japan; and yet that country is every bit as aggressively involved in courting Duterte as both China and Russia. In 2015 Japanese foreign direct investment (FDI) to the Philippines accounted for a staggering 28% share of total FDI, by far the biggest of any country. Or South Korea, another massive investor – far bigger than China.

Meanwhile, large Japanese and Korean corporations are pouring billions into the place as they jockey for large transport infrastructure projects. So why no Japan warning? Why no alert to the dangers posed by the South Koreans? Diokno has said that offers of financing have been received from both these countries. Could it possibly be because Japan and South Korea are strong US allies while China and Russia are seen by the US as unfriendly nations? Or are we being cynical?

No doubt Corr’s anti-Duterte coverage will be applauded in some quarters – certainly among the Philippines’ Liberal Party and its diehard admirers. They love negative publicity like this – don’t get us wrong, we’re not suggesting for a moment that Mr Corr has been retained by the Liberals for dark public relations purposes, producing articles that put Duterte in a bad light. But they certainly could have that effect.

Corr claims to have “government clients” – we have no idea who those are but obviously China, Russia and the present government of the Philippines aren’t among them.

26 Comments

    • Call this knowledge? Lol
      The article is POORLY written.Corr is a political analyst whose PhD is on Government. His undergrad degree is on International Relations. This is based on his bio in Forbes. He should never have written on international finance of which he seems to know squat. I think the article’s intent is not truth but to cast suspicion on Dutertenomics. Again, to put down our government. Forbes must also be getting senile publishing an article from someone who they know knows next to nothing about what he’s writing about.

    • Normande Rafael
      Laugh? (YAWN)
      My goodness.
      Did you read and actually understand Corr’s outrageous Assumptions?
      Or you swallowed.it all hook, line and sinker.
      Blinded by his color, white and ivy league credentials.
      We had an exchange in his wall.and you can hear the crickets when Corr realized, he Erred.

    • Summary of disputes (eerily similar observations.shared on his wall by finance and tax experts) i posted in Corr’s wall. He was silent for a while and changed the subject after he realized he cant bluff his way thru.
      MANG Uuto sya hanggat may UUTUIN sya. CLASSIC yan. And you fall to his trick.😉

      4 points.
      1. ODA loans usually carries 0.25 to 0.5% a year. Less than 1% per year compare to Corr’s estimate of 10-15% p.a.
      2. Corr ignored the CURRENT opporrunity loss resulting to loss tax revenue of government from horrendous traffic choking economic activities. WITH infra spending these losses shall be eliminated.
      3. Corr ignored the explosive economic activities that will be unleashed ona account of higher tax revenue for the goverment on increased economic activities and new economic centers resulting from opened infra pathways .
      4. Corr is ignorant that Funding mix of 8Trillion Philippine infrastructure development include forecasted increased in collection of taxes (Tax reform on excise taxes, VaT, removal of tax exemptions, increasing tax of the rich, tax reform bill passed committee level at lower house expected to be a law within 2017), low interest rate and long grace period ODA loans, local financing through banks and private entities.

      Flawed talaga analysis ng bayarang CORR . Wag basta magpapaniwala sa mga BANYAGANG bayaran. May sariling agenda mga yan. Marami ng ekspertong ekonomistang maaaring kunsultahin tulad nina Bernardo, Diokno, Purisima, Dominguez.
      Ingat po.

    • “Flawed talaga analysis ng bayarang CORR . Wag basta magpapaniwala sa mga BANYAGANG bayaran.”

      eto na lang ba ang lagi kong makikitang PALUSOT ng mga taong hindi marunong MAGBASA at MAGISIP? anu ba. bigyan nyo ako ng isang LEGIT. at 100% PROPER SOURCE to prove your FUCKING CLAIMS. hindi yung galing sa mga BARBERO na pages. please?

    • Normande Rafael
      Shit!
      You really dont comprehend. What i gave you above is my personal take as a finance and tax professional.
      Mas maniniwala ka sa link ng puti na Walang Alam sa sinulat nya?
      Ano yan colonial mentality😁😁😁
      Hindi mo pa nasagot kung nabasa mo at naintindihan mo article.ni Corr at un sagot ko.
      Kasi?
      Basta banyaga mas magaling.
      Asus

  • Normande Rafael
    Call this knowledge? Lol
    The article is POORLY written, lacks researched. Corr is a political analyst whose PhD is on Government. His undergrad degree is on International Relations. This is based on his bio in Forbes. He should never have written on international finance of which he seems to know durian as smooth as an apple. I think the article’s intent is not truth but to cast suspicion on Dutertenomics. Again, to put down our government. Forbes must also be getting senile publishing an article from someone who they know knows next to nothing about what he’s writing about.
    This is foreign junk.

    • Vicente Tatierra Abrenio Jr.
      Corr knows nothing about finance, i practice in tax and financial consultancy. Do the math.
      By the Corr was silent then changed topic of our convo after i posted below on his wall. He can bluff his way thru on a topic he is IGNorant.
      Na realize nya na di sya makaka UTO. Alam nyang MADAMI syang NAUTO.

      Summary of disputes (eerily similar to observations.shared on his wall by Filipino finance and tax experts in practice) i posted in Corr’s wall.
      He changed the subject after he realized he cant bluff his way thru.
      MANG Uuto sya hanggat may UUTUIN sya. CLASSIC yan. And you fall for it

      4 points.
      1. ODA loans usually carries 0.25 to 0.5% a year. Less than 1% per year compare to Corr’s estimate of 10-15% p.a.
      2. Corr ignored the CURRENT opporrunity loss resulting to loss tax revenue of government from horrendous traffic choking economic activities. WITH infra spending these losses shall be eliminated.
      3. Corr ignored the explosive economic activities that will be unleashed ona account of higher tax revenue for the goverment on increased economic activities and new economic centers resulting from opened infra pathways .
      4. Corr is ignorant that Funding mix of 8Trillion Philippine infrastructure development include forecasted increased in collection of taxes (Tax reform on excise taxes, VaT, removal of tax exemptions, increasing tax of the rich, tax reform bill passed committee level at lower house expected to be a law within 2017), low interest rate and long grace period ODA loans, local financing through banks and private entities.

      Flawed talaga analysis ng bayarang CORR . Wag basta magpapaniwala sa mga BANYAGANG bayaran. May sariling agenda mga yan. Marami ng ekspertong ekonomistang maaaring kunsultahin tulad nina Bernardo, Diokno, Purisima, Dominguez.
      Ingat po.

  • It’s all jealousy green eyed monster they will criticize to high heavens move move move on let them salivate on the juicy news from China they are up to destabilize but what else is new we are use to Soros Loida trollaness the yellow cult

  • I am observing, The Volatillian, at first you think it’s for government to realize later that it isn’t. Pupurihin nya sa simula, ibabagsak nya sa huli. Buti na lang, I read up to the end, so I am not deceived to repost them.

  • Almost all Critics have narrow minds or closed their brains believing their own conclusions. From the time, former US President Richard Nixon opened wide the American Doors to China… US and Other Foreign Corporations started doing business with what was then called “Communist China”. So now, almost “MADE IN CHINA” products/goods is all over the World. Ngayon, President Duterte has a different Foreign Policy from previous Administrations, they are making destructive criticism. KapitBahay natin ang China, so why not be friendly and trade, do economic business which the US, EU, AFRICAN NATIONS, and other ASIAN COUNTRIES are doing.

    • With the launching of One Belt One Road Initiative, US and its key western allies will be left out when the economies of the participating countries under this Beijing initiative start to grow bigger. Even Turkey, w/c is far frm asian region is requesting for membership accreditation with the ASEAN, has foreseen the potential of that initiative for their own country.

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