MANILA - President Rodrigo Duterte warned the 2 water concessionaires operating in Metro Manila and nearby areas that he can still go after them even if he signs new contracts with these companies.
During his sixth and last State of the Nation Address (SONA), Duterte again lashed out at the water concessionaires, without mentioning them by name, saying these companies were granted contracts that were very disadvantageous to the public.
“Dito sa tubig, in this contract, the water concessionaires, we made so many concessions that, really, sabi ko, if you look at the contract, look at the anti-graft law, talagang it’s all anti-graft, all of the sentences, even the period and question mark,” Duterte said.
The President said the water concessions specified that all corporate taxes would be shouldered by consumers, who would also pay for these companies' losses. The companies also decided when and how much water rates should rise, according to Duterte.
“Kaya sabi ko, wala ito. I told them, I think I told [Finance Secretary Carlos] Dominguez na: Tell them that I am no longer honoring the contract.”
The water supply of Metro Manila and nearby areas is divided between Manila Water in the east zone and Maynilad in the west zone. Both companies were granted new franchises by Congress earlier this year.
Duterte earlier said the water crisis in April 2019 “piqued” his interest in the water contracts, which prompted a review by the Justice department of the provisions of the water concession agreements.
In today’s speech, Duterte said he even threatened to confiscate the companies’ properties and hand these over to the military.
“Talagang inupakan ko sila. Sabi ko: Ayaw ninyo? You do not want it. Well okay, I will, I will just confiscate your system and call the military to operate it.”
But Duterte also warned that even if he signs new contracts with these companies, he can still go after them.
“I will not free you, no waiver, I will never allow that. Just make a new contract, just realize everyday that I can call you.”
Fitch Solutions earlier warned that the government's move to renegotiate the contracts of Metro Manila's water concessionaires would undermine investor confidence and affect foreign direct investments in the Philippines in the short term.
Business groups previously also called on the government to respect the sanctity of contracts.