Chronology Of Events

History Causes On April 2007, Department of Transportation and Communications (DOTC) Secretary Leandro Mendoza and ZTE Corp. Vice President Yu Yong entered into a US$ 329.5 million contract for a national broadband network (NBN) that will improve government communications capabilities.[1] On the 21st of the same month, Mrs. Arroyo flew to China and witnessed the contract signing between the Department of Transportation and Communication and ZTE Corp. in Boao province[2], despite the fact that, at the time, the First Gentleman was still recovering from a critical condition, having recently undergone surgery for aortic aneurysm. On August 29, Nueva Vizcaya Congressman Carlos Padilla hinted in a privilege speech that Commission on Elections (COMELEC) Chairman Benjamin Abalos went to China to broker a deal for the NBN project. The following day, Abalos denied brokering for the NBN project, although he did admit going to China four times.[1] On September 5, Senator Aquilino Pimentel called for a Senate investigation about the NBN project.[1] As a result, three committees held joint hearings about the issue: the Accountability of Public Officers & Investigations (aka the Blue Ribbon Committee) headed by Alan Peter Cayetano, the National Defense and Security committee headed by Rodolfo Biazon and the Trade and Commerce committee headed by Mar Roxas.

[edit] Senate investigations [edit] De Venecia's testimony Jose "Joey" de Venecia III, son of House Speaker Jose de Venecia, Jr., testified on September 10 that he was with Abalos in China and that he heard Abalos "demand money" from ZTE officials. The younger de Venecia was president of Amsterdam Holdings, Inc. (AHI), the company that lost its bid to ZTE for the NBN project.[1] On September 11, the Supreme Court of the Philippines promulgated a temporary restraining order (TRO) on the $329-million national broadband network (NBN) contract between the Philippine government and China's ZTE based on separate certiorari suits filed by Iloilo Vice-Governor and former Representative Rolex Suplico and Joey de Venecia III. Under political pressure from the opposition group, the court gave ZTE fifteen days to comment on the injunction. Suplico, a former opposition congressman, alleged that the agreement was sealed without public bidding and violated the Telecoms Policy Act, which required privatization of all telecommunications facilities. Congressman Padilla sued DOTC and ZTE officials of violating the Anti-Graft and Corrupt Practices Act, the Telecommunications Policy Act, the Build-Operate-Transfer (BOT) Act and the Government Procurement Act at the Office of the Ombudsman. AHI also petitioned the Court to direct the DOTC to provide copies of the contract, since it

should have won the same.[3] The younger de Venecia testified on September 18 that Mike Arroyo, President Gloria Macapagal-Arroyo's husband, personally told him to "back off" from pursuing the NBN project.[1] [edit] Neri's testimony On the September 20 Senate hearing, Cabinet officials attended the hearing except for former National Economic and Development Authority (NEDA) Chairman (now Commission on Higher Education Chairman) Romulo Neri, who was sick. On September 22, 2007, president Arroyo suspended the broadband contract with ZTE after the bribery scandal sparked major problems in her government.[4] Neri and Abalos finally faced each other on the September 26 Senate hearing; Neri testified that Abalos told him "Sec, may 200 ka dito" while playing golf at Wack Wack Golf Club; they had been discussing the ZTE deal at that time. Abalos denied making the apparent bribe attempt. Neri later invoked executive privilege in response to some Senators' questions.[1] He later shunned succeeding Senate hearings still citing executive privilege On September 27, 2007, ZTE petitioned the Supreme Court to lift the TRO alleging, in its urgent omnibus motion, inter alia, that the injunction cost the company millions.[5] Abalos announced his resignation as COMELEC chairman on October 1; Resurreccion Borra succeeded him as COMELEC chairman. President Arroyo on her October 2 trip to China, said to Chinese President Hu Jintao her "difficult decision" to cancel ZTE Corp.'s contract for the NBN project.[1] [edit] Lozada's kidnapping and testimony On January 30, 2008, the Senate produced warrants of arrest to Neri and Rodolfo "Jun" Lozada, Jr., former chief executive officer of the government-run Philippine Forest Corporation and a consultant of the NEDA. Neri then went into hiding while Lozada skipped the Senate hearing and went to Hong Kong.[6] Meanwhile, House Speaker de Venecia lost a motion of confidence vote on February 5, which unseated him as House Speaker; his partymate at Lakas-CMD, Prospero Nograles of Davao City, succeeded him as speaker.[7] On February 5, as the Senate arresting team waited on the Ninoy Aquino International Airport (NAIA) on Lozada's arrival,[8] Lozada was taken by unidentified people "out of town" and Lozada's kin appealed for help on his whereabouts.[9] On February 7, Lozada finally surfaced as police took him to La Salle Green Hills, Mandaluyong City. Lozada linked Mike Arroyo and Abalos to the ZTE scandal.[10] On the same day, the Supreme Court stopped the Senate from arresting Neri, ordering a status quo; Neri then resurfaced after the threat of arrest was taken off.[11]

The next day, on a Philippine Senate hearing, Lozada confirmed his NEDA boss Romulo Neri's testimony that Commission on Elections (COMELEC) chairman Benjamin Abalos and Arroyo's husband Mike Arroyo were behind the kickbacks in the deal. Lozada's statement was made after he was "abducted" on the orders of Department of Environment and Natural Resources (DENR) secretary Lito Atienza, Neri, former Presidential Management Staff head Michael Defensor, Secretary for Special Concerns Remedios Poblador and Deputy Executive Secretary Manuel Gaite.[12] On February 11, upon continuation of Senate hearings, the government denied on kidnapping Lozada. Lozada claimed he was driven around Metro Manila and even reached Los Baños, Laguna, before he was transported to the La Salle Green Hills seminary. According to DENR Secretary Atienza, Lozada, who is his boss as the Philippine Forest Corp. is under the DENR, asked for his help as "he feared for his life" as he returned from Hong Kong. Joey de Venecia later claimed that ZTE advanced USD 1 million to Abalos; senators pointed out that this qualifies as "plunder" under Philippine criminal law since the advance was given when the foreign exchange was at about PHP 50 to $1, thus equaling the PHP 50 million floor for plunder.[13]

[edit] Ombudsman cases The Office of the Ombudsman subpoenaed First Gentleman Mike Arroyo, Neri, the de Venecias and Abalos to hear their side of the story. The case was filed by former vice president Teofisto Guingona, Jr., several lawyers, Fr. Jose Dizon and party-list Representatives Joel Villanueva and Ana Theresia Hontiveros-Baraquel, among others.[14]

[edit] Reactions [edit] CBCP Official Statement The Catholic Bishops' Conference of the Philippines, due to the Filipino people's clamor for a united political stance, called an emergency meeting on the 25th of Ferbruary 2008. Under his CBCP presidency, the bishops said in their statement: "They refused to call for her resignation saying they wanted her, President Gloria Macapagal-Arroyo, to be part of the moral reform process.

[edit] De Venecia et al. After the Lozada testimony, several sectors and prominent people such as Joey de Venecia and senator Panfilo Lacson called for president Arroyo's resignation, while Senate President Manuel Villar and senator Alan Peter Cayetano called for a leave of absence.[15][16] Vice President Noli de Castro on the other hand, asked President Arroyo and other government officials "should be charged" if they would be found directly involved in the alleged anomalies.[17]

On February 12, the Makati Business Club and other about 80 groups called for Arroyo's resignation.[18] An estimated 10,000 people held a protest rally in front of Ninoy Aquino statue in Makati City to demand the resignation of Arroyo in February 15.[19] More than 4,000 including former President Corazon Aquino and Lozada attended the Sunday mass at the La Salle Green Hills' St. Benilde Gymnasium.[20]

Additional Facts:

Arroyo caught in web of own lies February 26, 2008 23:18:00 Neal Cruz [email protected] Philippine Daily Inquirer MANILA, Philippines -- So she did know. President Gloria Macapagal-Arroyo was finally forced to admit that she knew as early as last April that the ZTE national broadband network (NBN) contract was anomalous. (My column last Monday, which asked if she knew, was written on Saturday. She made her admission last Sunday.) She said in a radio interview she “moved swiftly” to cancel the deal “the moment I learned there was the slightest suspicion of anomaly” in the project. “Moved swiftly”? “The moment” she learned? It was five months later, on Oct. 2, 2007, that she scrapped the deal, and only after the stink became unbearable when Joey de Venecia III testified in the Senate and exposed the bribe offer to him and the involvement of her husband Mike Arroyo, and Commission on Higher Education Chair Romulo

Neri revealed that he was offered a P200-million bribe. That’s “moving swiftly” “the moment” she learned? On the contrary, she still went ahead and took the trouble to go to China to witness the signing of the contract between Chinese firm ZTE Corp. and our Department of Transportation and Communications instead of canceling it “swiftly.” “How can you cancel it on the eve of the signing?” was her lame excuse. “We would lose face.” Why would we lose face if we cancelled an anomalous deal? On the contrary, she should have been proud to cancel it because she was nipping corruption in the bud. She should not have gone to China to witness the signing in the first place. She had a good reason not to. Her husband was seriously ill, having just survived a life-threatening heart operation. She didn’t have to be there. But no, she left his sickbed and took the trouble to go to China to witness the signing of what she knew was an anomalous contract. She was afraid to lose face before the president of China but not to 90 million of her countrymen? She is not only losing face now but may also lose her presidency because she was afraid to “lose face” before one man. The ZTE deal was only one of many contracts to be signed that day. The non-signing of the ZTE contract would not have been noticed. As it turned out, the Chinese president

didn’t mind when told about it later. “He understood,” she herself said. Despite her admission, I think the President is still not telling everything. She did not say that she did not cancel the deal immediately because she was still hoping it would go through. Sayang naman ang $70 million commission that her hubby was promised. At that time, that was worth P3.5 billion (that’s billion!), enough to retire on in comfort in Monte Carlo or on a Caribbean island when she is out of power here. In fact, that must have been the reason she took pains to go to China -- to show that she was behind the deal so it would push through. That is why she used all her subordinates and allies to justify the deal and deny that there was any irregularity. That is why she officially declared in September last year that “after an investigation” they found “no hard evidence for junking the deal.” That is why she prevented her Cabinet secretaries, through Executive Order 464, from testifying in the Senate. That is why she used all the President’s men to abduct Rodolfo Noel Lozada Jr., threaten him, force him to sign false affidavits and try to bribe him to prevent him from testifying in the Senate. Only when the people, after hearing Lozada, demanded her resignation and fearing that the protest movements may escalate into another people power that may force her out of Malacañang did she deign to admit that she knew last April of the anomaly. It was an attempt to defuse the anger of the

people and perhaps save her. But it only got her deeper in the muck. That’s what happens when you lie. You are caught in the web of contradictions of your own lies. If she knew as early as last April that the ZTE deal was anomalous, then she must have been lying in September when she declared there was “no hard evidence for junking the deal.” And what happens now to Transportation and Communications Secretary Leandro Mendoza and Undersecretary Lorenzo Formoso, as well as other officials who have been insisting that the ZTE deal is above board? With Ms Arroyo’s admission that it was anomalous, it is clear that they have been lying through their teeth all along. They should come out now and make a clean breast of it and apologize to the people. It is obvious that Ms Arroyo will not hesitate to sacrifice them to save her neck. More and more, the ZTE deal is becoming Ms Arroyo’s Watergate. Like US President Richard Nixon then, she is sacrificing her loyal men to save herself. But like Watergate, the investigation is peeling layer after layer of cover-up to reveal the ugly secrets. All that is needed now to complete the picture is for one more official (like Neri?) to be stricken by his conscience (and also to save himself) and tell all. And for her allies in Congress to tell her the jig is up. Then she can take the honorable way out and step down like Nixon did.

Of course, what she did -- allow an anomalous deal -- as well as other illegal things she had done earlier are grounds for impeachment. But those who want her impeached better prepare the impeachment complaint early enough, otherwise another Oliver Lozano may beat them into filing a weak impeachment complaint this July to save her, again, from a more serious one. Presidential adviser Joey Salceda is right, she “is the luckiest b*tch alive.” She should have been impeached a long time ago were it not for the quickness of the Oliver Lozanos and the slowness of opposition leaders, the immoderate greed of congressmen, the fear and indifference of public officials in the know, and the apathy of many Filipinos. And having Noli de Castro as the Vice President.