Roque: Duterte's offer of telco role to China a 'political decision'

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FILE PHOTO. During President Rodrigo Duterte's bilateral talks with Chinese Premier Li Keqiang in Manila on November 15, he offered China a chance to supply the country's newest telecom provider, Malacañang said.

Metro Manila (CNN Philippines, December 12) — President Rodrigo Duterte's offer for a Chinese company to be the country's third telecommunications provider was a "political decision," his spokesperson said Tuesday.

"(It was) intended I guess also to strengthen our bilateral ties with China," Presidential Spokesperson Harry Roque said in a press briefing.

He said the player that was chosen by China, China Telecom, "without doubt is one of the biggest in the world."

Roque said the Chinese company will improve poor telecoms service in the country, which has one of the slowest Internet speeds in the region.

Read: PH slowest internet in Asia-Pacific, but there is hope - report

"Chinese companies ought to have already technical know-how in providing competent and reliable telecom services," Roque said.

During Duterte's bilateral talks with Chinese Premier Li Keqiang in Manila on November 15, he offered China a chance to supply the country's newest telecom provider, Malacañang said.

This will finally break the duopoly, Trade Secretary Ramon Lopez earlier told CNN Philippines' The Source. The market in the Philippines has been dominated by two players - Globe Telecom Inc. and PLDT Inc.

Read: Trade Secretary: Up to a year before new telco enters

The President has been vocal against the state of the internet in the Philippines, saying the only way to improve internet speed is to introduce competition.

Gov't to address security concerns

Duterte's offer to China has been lauded and criticized when it was announced in November.

Senate President Koko Pimentel welcomed a new telco provider, saying competition was "the only way to force the two major local telco companies to improve their services."

But former President Benigno Aquino III said it would place national security at risk.

"Mahirap naman yatang 'yung communications infrastructure mo eh sa potential na baka magkaroon tayo ng actual na conflict (I think it would be difficult if your communications infrastructure is with a country that the Philippines could have an actual conflict with)," Aquino earlier said.

The country has a dispute with China on overlapping claims in the South China Sea. Duterte has repeatedly said the Philippines could not afford to go to war with China over the sea row.  But he promised that within his term, he will talk to China about the arbitral ruling in favor of the Philippines, which China refused to recognize.

Read: What you need to know about the Arbitral Tribunal's ruling

Roque on Tuesday said the government will look into all security considerations of having a Chinese company as telco provider, saying "there are really concerns overall on cyber security."

Legal challenges

When asked if other countries aside from China would be given the same opportunity, Roque admitted that Duterte's invitation to China alone is "already fraught with challenges."

"It would not be as simple as it seems. There will be legal challenges. But we are confident we can overcome all these challenges because after all it is our commitment to provide viable public service in the telecoms industry to the Filipino people," he said.

Senate Public Services Committee Chair Grace Poe earlier welcomed the development, but pointed out there were legal hindrances to having a foreign provider.

"Healthy competition could lead to better services for the consumers. However, our current laws would not allow this," Poe said in a statement on November 21.

Article XII, Section 11 of the 1987 Constitution limits foreign ownership in public utilities "to their proportionate share in its capital" and mandates that "executive and managing officers of such [a] corporation or association must be citizens of the Philippines."

This ban has been taken to include telecommunication services.

CNN Philippines' Regine Cabato contributed to this report.