Has the Choice for the Third Telco Player Been Rigged? Will a National Social Credit System be the Next Telecom Agenda?
Using the Telecom sector as an example of the fascist model of socialism, I recently wrote,
Furthermore, competition is amazingly seen on a different lens by the National Government (NG) and the mainstream. Instead of open competition to provide consumers with the best services at most affordable prices, the bidding process for the third telco participant represents a competition designed to GRATIFY the whims of the government!
The byzantine obstacles via the “highest committed level of service (HCLoS)” imposed ensures not only of high costs and elevated risks for the third player, but also the challenge to cut through the thicket of regulations!
Rising Risks of a Fiscal Crisis: Record Public Spending Share to GDP! BIR Revenue Plunged 8% in September! Public Debt Servicing Costs Rockets! October 29, 2018
The results of the National Government’s selection may have been MORE than a competition designed to GRATIFY the whims of the government; there may not have been any semblance competition at all!
The supposed bidding may have been predetermined. The selection process may have been a political charade to embellish legitimacy to it.
Proof?
Please allow these articles to do the talking…
In 2017, President’s Duterte made a compact to the Xi Government…
From the Rappler (November 20, 2017): “Philippine President Rodrigo Duterte offered to China the chance for one of its firms to be the 3rd major telecommunications company in the Philippines, with the goal of ending the duopoly in the vital industry. This was announced by Presidential Spokesman Harry Roque on Monday, November 20, during a Malacañang press conference."During the bilateral talks between President Duterte and the Chinese Premier, the President offered to the People's Republic of China the privilege to operate the 3rd telecoms carrier in the country," said Roque, referring to the November 15 meeting of the two leaders in Malacañang. The Philippine government is now just waiting for Chinese telecom companies to submit their proposals. Roque said the government will only take "45 days" to determine if the offer will be taken.”
The telecom deal has been sealed with a kiss! …
From the South China Morning Post (December 11, 2017): “The Chinese government selected China Telecom to invest in the Philippines upon invitation by President Duterte during the bilateral meeting last November 16,” said Eliseo Rio, secretary of the Department of Information and Communications Technology. Chinese companies, however, could not operate alone in the Philippines and would need to partner with a local company. The government is now looking at whowill partner with the state-run China Telecom on a 60-40 basis, Rio said.”
Is this the smoking gun?
But then the political vaudeville …
From the Inquirer (October 23, 2018): The Department of Information and Communications Technology (DICT) committed on Monday to wrap up a series of policies to further level the playing field in the telco sector as it seeks to choose a challenger to incumbents PLDT Inc. and Globe Telecom by next month.
…which ended up with the awarding of…
From ABS-CBN (November 7, 2018): “Filipino authorities on Wednesday selected a joint venture of China Telecom and Davao tycoon Dennis Uy as the country's provisional new major telecommunications player that would go against PLDT Inc. and Globe Telecom. The consortium, Mislatel, beat Tier1 backed by former Ilocos Sur Governor Luis "Chavit" Singson and Philippine Telegraph and Telephone Corp. (PT&T). Mislatel includes China Telecom, Udenna Corp., and Chelsea Logistics. Only 3 of the 7 who bought bid papers participated. Singson's group and PT&T, however, were disqualified for failing to meet all the bidding requirements.”
…to fulfill the promise.
See? This selection mirage should be an example of how technical obstacles are created for the purpose of deliberately weeding out the competition.
With the labyrinth of requirements…
Boom! All were disqualified except for the chosen.
But then the denial over manipulating the process …
From the Inquirer (November 8, 2018): “Malacañang on Thursday said the link between President Rodrigo Duterte and Davao-based businessman Dennis Uy does not play a role in the selection of the “provisional” third major telco player. Presidential Spokesperson Salvador Panelo stressed that the selection of Uy’s consortium underwent proper bidding process without the intervention of Duterte. “As we all know, relationship, alliances, friendships do not matter with this President. What matters with him is ‘you follow the law, I’ll be with you. You don’t follow the law, I’m against you,’” Panelo said in a Palace briefing.
But then...
Once again…
…the SCMP’s publication last December 2017: The Chinese government selected China Telecom to invest in the Philippines upon invitation by President Duterte during the bilateral meeting last November 16,” said Eliseo Rio, secretary of the Department of Information and Communications Technology… The government is now looking at who will partner with the state-run China Telecom on a 60-40 basis, Rio said.”
Have such process not been deliberately gamed to accommodate the Chinese government?
But there are more important questions than the selection or bidding process itself.
Why opt for a state-owned telecommunication company? Because they are more efficient?
And why choose China? To curry favor with the Xi regime?
What comes in exchange for this?
What are the unstated costs?
Or, since China Telecom is a state-owned company, whose interests will be of its priority? Will it be the Filipino consumers? Will it be Mr. Duterte? Or will it be the geopolitical agenda of the Xi Jinping Government?
How is this related to the territorial disputes?
And as an international political agency not subject to profit and losses, will China Telecoms use its political position and local political connection to UNDERMINE domestic market competition through PREDATORY practices to snare a monopolistic hold on the industry?
The regime even initially hinted for a 100% ownership of the telcos. From the Inquirer (July 26, 2018): “Fully foreign-owned telcos can soon operate in the Philippines once President Duterte signs the proposed shorter 11th Foreign Investment Negative List (FINL), the country’s chief economist said Thursday.”
100% ownership doesn’t guarantee that the goal for a state-owned company would be to seek rewards with profits in service of the consumers. Instead, the caprices of the central authority determine its operating ambit. With that in mind, political firms like China Telecom can move goalpost smoothly.
That said, using the 3rd player as a means to feel the market, is the Duterte regime plotting for a nationalization of the telecom industry using China Telecom as the subcontracted operator?
Way back before this regime assumed power, I predicted (bold added)
the government will likely decrease participation of private sector in the economy through legislation. The government will likely resort to the substitution of private sector participation through nationalizations. Or that the government will increase regulations and mandates that will raise barriers to entry. So by picking on winners, the incoming administration may essentially endow the privilege of political protection from competition to select favored (rent seeking/crony) private entities or to state owned enterprises.
And here’s more.
The Chinese government has implemented a national “social credit system” where the citizenry is ranked and scored by a “reputation system” determined by the central authorities which it plans to expand usage nationwide by 2020. Or, the Chinese authorities use advanced and sophisticated technologies like AI, machine learning, big data and more to control the behavior of the citizenry.
And from here, the individual or the citizen is rewarded or punished accordingly through the incentives of extended social privileges or penalized by its deprival. By being out of favor, the government may impose punitive social measures such as: blacklisting by banning one from flying or getting the train, throttling internet speeds, banning children from going to the best schools, preventing one from getting the best jobs, keeping one out of the best hotels, having one’s pet taken away, publicly shamed as a bad citizen and more.
The publishing outfit, the Economist, has branded this as the “world’s first digital totalitarian state”. Others call it a dystopian Sci-Fi scenario switched On (or transformed to reality)
A national ID system has been signed into “law” by the Philippine leadership in August 2018, with plans for its full 5-year implantation starting 2019.
Will the next agenda be the Chinese government’s export of its national social credit system to the Philippines? Has China Telecom been chosen for this purpose?
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