The Department of Trade and Industry (DTI) said the review of the government’s contract with the water concessionaires is not creating uncertainties in the business environment.
This developed as the Metropolitan Waterworks and Sewerage System (MWSS) assured that in cooperation with concessionaires Maynilad Water Services Inc. and Manila Water Services Inc., it is exerting efforts to comply with the directive of President Duterte to execute a new water concession agreement after 2022 which is currently being drafted by the Department of Justice.
Ramon Lopez, DTI secretary, in a press briefing said the fact that government is reviewing a one-sided contract and is correcting its onerous provisions should ensure a clean and fair contract with private sector.
He added that as long as water remains a priority sector, the concessionaires ,if they reinvest, can be assured of incentives.
Lopez said the water concessionaires enjoyed incentives at the time they registered their projects with the Board of Investments.
“If they apply … and reinvest and if it is a new investment … and eligible, just like any other (priority) project (can get incentives). Of course (with a new contract) there is consciousness and awareness the contract is in order,” Lopez said.
He added: “(The contract) has to be corrected. We have to agree on a new contract where the onerous provisions will be removed.”
Presidential spokesman Salvador Panelo earlier said Duterte will make an announcement on January 6 on the water issue.
The MWSS in a statement said Manila Water and Maynilad are cooperating not only through their declarations to no longer collect or enforce the recent arbitral awards but also in their expressed willingness to renegotiate “inequitable provisions” of the concession agreement as well as to include other provisions that are beneficial to consumers.
“The continuity of the water sector PPP (public p[rivate partnership) depends on strong communication channels and handholding engagement so that the basic access to water and wastewater services will not be jeopardized, which includes fully addressing and accomplishing the urgent call for new water and sewerage infrastructure projects,” MWSS said.
MWSS also said the 25-year contracts from 1997 to 2022 with the concessionaires are still valid and only those covering extension period of from 2022 to 2037 are being renegotiated.