Philippine Military: We Welcome Probe Into Telecom Deal With China-Backed Firm

The Armed Forces of the Philippines said Tuesday it would welcome a Senate inquiry into its approval of a controversial deal that allows a Chinese-backed consortium to set up telecom cell towers in the country’s military bases.

Critics of the deal renewed demands that the Senate investigate the deal with Dito Telecommunity Corp. after Defense Secretary Delfin Lorenzana last week acknowledged he had approved it.

Opponents say the arrangement undermines national security, as it exposes Philippine military bases to Chinese espionage.

“We respect the Senate’s oversight function,” military spokesman Maj. Gen. Edgard Arevalo said in a statement. “Thus, we are happy to be tasked and in fact welcome the call for a Senate inquiry on the signed agreement between the Armed Forces of the Philippines and Dito Telecommunity Corp.”

Lorenzana told lawmakers last week that Dito Telecommunity was allowed to set up equipment and cell towers in military bases because its competitors, Globe Telecom and Smart Communications, also had cell sites, equipment and relay stations there.

He further said these companies were allowed to set up in military bases because their equipment there was protected from communist insurgents who often attack cell towers in the provinces.

However, what gives critics pause is the fact that the state-owned China Telecommunications Corporation owns a 40-percent stake in Dito Telecommunity. The other partners in the consortium are Chelsea Logistics and Udenna Corp., owned by Filipino businessman Dennis Uy, who is a supporter of President Rodrigo Duterte.

Since being elected in 2016, Duterte has sought to distance the Philippines from the U.S. and forged closer ties with China despite their differences on the South China Sea.

National security

Opposition Senator Risa Hontiveros, who filed a Senate Resolution last September calling for an investigation into Dito Telecommunity, questioned the legality of allowing a partly Chinese-backed firm inside sensitive military bases.

“Have we agreed to be taken over?” Hontiveros asked in a statement Monday.

“A China-owned telco inside our own military bases is suspicious, especially since China has been aggressively taking over the West Philippine Sea, destroying our natural resources and abusing Filipino fishermen,” she added, using the Philippine name for the portion of the South China Sea that lies west of the country.

Hontiveros said that Dito Telecommunity was bound by China’s Counter-Espionage Law, which means it has to assist Beijing’s security apparatus and is bound to turn over any information China demands.

“It's as if the Chinese state itself is present within our military camps. Our national security is at risk here,” Hontiveros said.

“This is already a warning signal, and yet the AFP [Armed Forces of the Philippines] seems to have forgotten the warning its mother department itself raised last year,” she said, referring to Lorenzana’s August 2019 warning that Philippine Offshore Gaming Operators (POGOs) known to employ citizens of China could pose an espionage risk for security installations nearby.

BenarNews contacted Dito Telecommunity for comment but didn’t hear back.

However, the company, which is set to begin operations soon, said last Wednesday in a statement that “its devices, equipment, and structures shall not be used to obtain classified information from the [Philippine] Armed Forces,” reported ABS-CBN News.

"Let us make clear that the Armed Forces of the Philippines has in place stringent protocols that disallow foreign nationals from performing sensitive technical work within military camps,” Adel Tamano, DITO Telecommunity chief administrative officer said in the statement.

“The Memorandum of Agreement signed with the AFP contained the very same provisions signed by the other two telcos with the notable exception that additional provisions were provided pertaining to commitments of DITO to national security."

Still, Hontiveros said the deal needs to be investigated urgently and that she would lobby the Senate to immediately launch a hearing based on her resolution from last September.

“We, in the Senate, should exercise our oversight powers at once to ensure that our national security is not undermined,” she said.

Hontiveros’ resolution has yet to be approved in the Senate, which is controlled by Duterte allies. The Senate’s committee on national defense and security has tentatively tabled it, although a date has not yet been set to hear it, a source told BenarNews.

Meanwhile, a petition started a week ago on Change.org urging the Philippine Congress to prevent Dito Telecommunity from operating in the Philippines has gained close to 4,000 signatures.

“We started this petition to the Philippine Congress to stop the entry of Dito Telecommunity into the Philippine telco industry until its risks to the country are thoroughly assessed,” the petition says.

“It is true that the current offerings of the country's telco players need significant improvement. However, we must ask: ‘Will a 3rd telco with ties to the Chinese government actually help us out? Or is it some form of Trojan Horse that will be the cause of added woes?’”