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Telecom scandal: Arroyo knew of graft months ago
Mon, Feb 25, 2008 The Straits Times
MANILA - PHILIPPINE President Gloria Arroyo has admitted to knowing about possible corruption in a telecommunications deal with a Chinese company nearly six months before she cancelled it. In a radio interview on Saturday, she said she was alerted in April to possible corruption in the US$329 million (S$462 million) deal with ZTE Corp, China's second-biggest telecoms equipment maker. She was again told about possible irregularities the night before she attended the signing ceremony in China. 'How can you cancel the night before when you are negotiating with a foreign country?' she said.

Mrs Arroyo scrapped the deal in October after a businessman testified in a Senate probe that the country's elections chief and Mrs Arroyo's husband had told him to abandon his bid for the broadband project.

In a speech at the presidential palace after Sunday Mass, Mrs Arroyo firmly denied that her family profited from government deals and vowed she would not spare anyone who was found guilty of corruption.

In the opposition-dominated Upper House, senators said Mrs Arroyo had forced herself into a corner with her admission. 'What President Arroyo did or did not do after she learnt there was something wrong...is the smoking gun that links her to the scandal,' said Senate Minority Leader Aquilino Pimentel Jr.

The ZTE scandal resurfaced this month when a former government official reiterated the allegations of kickbacks. The new testimony galvanised opposition groups, who have renewed calls for Mrs Arroyo's resignation.

REUTERS, AGENCE FRANCE-PRESSE