Gabriela Women’s Party Representative Liza Maza today called for the immediate termination of the Northrail contract saying that the issues now being raised by the China National Machinery and Equipment Corp. Group (CNMEG), as well as price adjustments amounting to over US$ 299M corroborate allegations of bribes and anomalies that have hounded the US$ 503M Northrail Project.
According to the Gabriela solon, “The termination of the Northrail contract and the prosecution of those involved are long overdue. The Arroyo government has already wasted millions in taxpayers’ money and should not be given the opportunity to waste even more.”
Reports reveal that since January 2005, it has reportedly been paying about $400,000 in monthly interest. The government has allegedly drawn USD$105 M of the loan in 2004. Moreover, with the price adjustments, the total cost of the project would now amount to at least US$ 802M. “Why the government insists on carrying on with the project despite its already huge and rising cost is in itself dubious and questionable,” Maza further said.
The Northrail Project, a deal financed by a disadvantageous loan of around US$ 503M from the Export-Import Bank of China and awarded to Chinese contractors, was overpriced and allegedly involved some US$ 50-100 M in commissions and kickbacks to high-ranking government officials. “These allegations that surrounded the Northrail project from the very beginning have yet to be resolved.”
“This project is a burden to the people. The $400,000 monthly interest that the government is now compelled to pay can be used for subsidies and other projects for the poor and marginalized. Terminate this project now so we can be spared from the burden of paying for the kickbacks and anomalies that have long surrounded this project.” said Maza.
“Moreover, we believe that the reason why the Arroyo government insists on collecting the 12% VAT, is because of its commitment to pay these overpriced and anomalous ODA loans such as the Northrail project.”
Research conducted by the partylist group meanwhile reveal that US $50-100 M commissions from the Northrail project could have produced 4,000 classrooms or 3,636 houses or it could have treated 2,000 women with breast cancer at P1M per treatment.#