China Telecom earmarked as Philippines' 3rd telecoms player: Manila officials

MANILA (Reuters) - State-run China Telecom Corp could become the Philippines’ third telecoms player, officials of the Southeast Asian nation said on Sunday, as the government looks to stir up competition in an effort to boost notoriously poor services.

The logo of China Telecom is pictured at its booth during an expo in Guangzhou, Guangdong province, China July 27, 2017. Picture taken July 27, 2017. REUTERS/Stringer

Philippines President Rodrigo Duterte last month offered China the “privilege” of challenging a longstanding duopoly that has frustrated consumers because of slow and intermittent internet and mobile phone services.

“The Chinese government selected China Telecom to invest in the Philippines upon invitation by President Duterte during the bilateral meeting last Nov. 16,” Eliseo Rio, secretary of the Department of Information and Communications Technology, told Reuters.

Chinese companies cannot operate alone in the Philippines and would need to partner with a local company.

The government is now looking at who will partner with China Telecom on a 60-40 basis, Rio said.

China Telecom, one of China’s top three state-backed telecommunications firms, said on Monday that no deal has been reached yet.

“China Telecom is currently having a preliminary study on the investment opportunity in Philippines and no concrete plan has been determined yet,” a China Telecom spokesman told Reuters.

The Philippine constitution’s 40 percent cap on foreign ownership of domestic telecoms companies has kept interest from multinationals at bay in the market of more than 100 million people. Presidential Communications Secretary Martin Andanar said the state-owned Chinese company should partner with a reputable Philippines company with an existing telecoms franchise.

“The government is fast-tracking this because consumers are getting annoyed with dropped calls and slow internet connections,” Andanar said in a radio interview on Sunday.

Also seeking to be a major player is Philippine Telegraph & Telephone Corp, which had said it was talking with China Telecom and Datang Telecom about strategic partnerships to challenge the nation’s dominant duo of PLDT Inc and Globe Telecom Inc.

Reporting by Neil Jerome Morales; Additional reporting by Cate Cadell in BEIJING; Editing by David Goodman and Muralikumar Anantharaman