Cebu Gov. Garcia to end joint agreement with Manila Water

CEBU CITY – Governor Gwendolyn Garcia is firm in her decision to terminate the joint investment agreement (JIA) with Manila Water Consortium Inc. after the provincial government notified the firm of 5 alleged breaches discovered in the JIA.

Manila Water and Maynilad Water Services are also being investigated by the national government after President Rodrigo Duterte expressed outrage over the decision of the Permanent Court of Arbitration in Singapore, directing the government to pay Manila Water billions of pesos for the non-implementation of water rate increases that occurred prior to his assumption to the presidency.

A review of the agreements with the Manila Water and Maynilad reveals that they are contrary to public policy and public interest, the same being onerous and disadvantageous to the people, relative the terms or periods, government non-interference, as well as concessionaire indemnification for losses, according to Duterte, who directed the filing of the appropriate criminal, civil and administrative charges against all those involved in the said agreements including the latter's owners and legal counsels, as well as agents and lawyers of the government for economic sabotage.

Garcia said it is just rather very significant that Duterte is also taking action against Manila Water and Maynilad for those agreements which are grossly disadvantageous to the Filipino people.

The governor said she would no longer meet with the executives of Manila Water to negotiate the JIA, but instead discuss to them the dues that the Province of Cebu could collect from the firm. “Negotiations with Manila Water are off the table,” she said, stressing that the provincial government is weighing its options against Manila Water to protect the interest of the Cebuanos.

The Provincial Board also passed a resolution authorizing Garcia to sign the termination notice against Manila Water.

In August, Garcia issued a notice of breach against Manila Water, through its president and chairman of the board of directors, Virgilio Rivera. In the notice, she gave the firm 90 days to cure the alleged breach in the JIA, but Garcia said she was not satisfied with Rivera’s response dated November 4.

The JIA between the province of Cebu and Manila Water was signed on March 21, 2012, creating the company, Cebu Water, with a 49-51 percent profit-sharing scheme in favor of the private company.

In the JIA, the private company agreed to manage bulk water supply from Luyang village in the northern town of Carmen, Cebu. The P1.1-billion water project started producing 35 million liters of water every day for Metro Cebu households through the Metro Cebu Water District.

The governor wants the company to account for an estimated P150 million of revenues supposedly for the province. (John Rey Saavedra. With additional reporting from the Cebu Examiner.)

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