Manila’s water problems

PHILIPPINES - In Brief 05 Dec 2019 by Romeo Bernardo

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On Tuesday, Manila’s business elites found themselves at the receiving end of President Duterte’s latest tirade. The cause? A ruling by the Permanent Court of Arbitration in Singapore for government to pay Manila Water, one of the metropolis’s two water concessionaires, P7.39 billion (~$145 million) for losses resulting from “acts in breach of the procedure committed by officials of the previous administration.[1]” The other concessionaire, Maynilad Water also has a pending collectible from government amounting to P3.4 billion (~$67 million), likewise upheld by the Singapore court last year, due to government’s refusal to adjust tariffs in line with the terms of the concession agreement. Manila Water is part of the Ayala conglomerate while Maynilad’s controlling shareholder is Metro Pacific Investments Corp. (MPIC). In his usual uncensored, expletive-laden outburst, he accused the owners of the water concessionaires of not paying corporate income taxes and not providing wastewater treatment services, threatening to charge them with economic sabotage and put them behind bars. Having found the existing contracts “onerous,” he also directed his justice and finance secretaries to craft a new contract that will be given to the concessionaires on a take it or leave it basis. The President’s words drew different reactions from different sectors. Some, including senators, quickly backed his directive to review the concession agreements. Others, hearing his disjointed attacks against not only the water concessionaires but also a major television network, mixed in with praises for other businessmen-supporters, hastily drew parallels with Marcos-era crony capitalism. Still others...