Too early to raise red flag on 'Chinese takeover' of Hanjin - analyst


Posted at Jan 14 2019 06:58 PM

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MANILA - It's too early to tell if national security will be put at risk by a Chinese takeover of the Subic operations of troubled South Korean shipbuilder, an analyst said Monday. 

Bob Herrera-Lim, managing director of international consultancy firm Teneo, said that there were still a lot of things that remained unknown about the reported plan of some Chinese firms to invest in Hanjin.

Lim said 2 issues that need to be confirmed are: 1) if a Chinese takeover of Hanjin means unimpeded access to Subic for Chinese ships; and 2) if the Philippines Navy uses Hanjin's shipyards.

If any of these 2 concerns were confirmed, then there was a "strategic component" to the Chinese investment, Lim said. 

But he also warned that raising strategic security concerns prematurely may cause investors to be wary. 

"I don't think that, just off the bat we could say that just because it's Subic, it's strategic," Lim said in an interview with ANC's Market Edge.

Lim said the Philippines needed a "mechanism" for assessing if certain foreign investments have an impact on national security.

He added that such a framework may require legislation or better coordination between agencies, but this was preferable to "scaring away investors with the threat that if the investment is perceived as coming from another country, then we'll raise noise about it." 

Former Philippine Navy chief Alexander Pama earlier warned that a Chinese takeover of Hanjin was "a very significant national security issue."

Malacañang, meanwhile, said it sees no problem if Hanjin was taken over by a Chinese firm with proven track record.