Ex-Navy chief raises alarm on possible Chinese takeover of Subic shipyard

Updated 4 a.m. , January 14, 2019

MANILA, Philippines — A former Philippine Navy chief has sounded the alarm over the security and strategic implications on the prospect of a Chinese takeover of a commercial shipyard in Subic.

His statements came after two Chinese firms have reportedly expressed interest to invest in the local unit of Hanjin Heavy Industries and Construction Corp., currently struggling in massive debt.

READ: 2 Chinese firms eye Hanjin

“Let’s be aware that this Hanjin shipyard issue is not just about business, financial and other economic issues. This is a very significant national security issue!” former Navy chief Vice Adm. Alexander Pama said in a Facebook post on Saturday.

“The ownership of Hanjin shipyard in Subic bay will give the owners unlimited access to one of our most strategic geographic naval and maritime asset[s]. Although it is a commercial shipyard, nothing can prevent the owners from making it into a de-facto naval base and a maritime facility for other security purposes,” he said.

Pama served as Navy chief from 2011 to 2012, at a time when the Philippines was sharply critical of China’s massive claims in the South China Sea.

Subic Bay, a former US military base until it closed in 1992, is located about 260 kilometers from the Chinese-occupied Scarborough Shoal in the West Philippine Sea (South China Sea). It is also the safest and nearest port facing the disputed waterway.

When the Americans left, it was transformed into an industrial hub. Naval ships of foreign countries, including the US, conduct port calls there from time to time.

The biggest Philippine Navy ships also take shelter at Subic.

If China gains access to the shipyard, the former Navy chief expressed concern that it could later serve different purposes.

“Baka pag nagpa-patrol ang Chinese Coast Guard sa Scarborough, dyan na sila nagpapahinga, mag-re-repair at mag reprovision,” he told Inquirer.net.

“Nag-aagawan tayo ng mga lugar tapos ibibigay natin yung shipyard sa Subic,” he added.

Two Chinese shipbuilding firms — one of which is state-owned — have expressed interest in taking over the shipbuilder, which recently declared bankruptcy after it defaulted $412 million in loans. This is on top of its $900 million debt to South Korean creditors.

Pama urged the government and business sector to review the potential acquisition of the shipyard due to the risks it poses to national security.

“Let us all be aware and wary of the serious security and other strategic implications of this issue! I urge our patriotic business community and the government not to allow Hanjin Shipyard to fall into the wrong hands,” he said. /atm/ac