Directly addressing the reported call by an advocacy group for the Senate to investigate the alleged sell-out to Chinese investors of the Grande and Chiquita Islands here in Subic Bay, the Subic Bay Metropolitan Authority (SBMA) said it looks forward to such an official inquiry to resolve the long-drawn issue over the two tourism islands here.
SBMA Chairman and Administrator Wilma T. Eisma said that the Subic agency would welcome any investigation over the falsely reported “sale” of the islands, which were leased in 2019 to a joint venture between GFTG Property Holdings Corp. and Sanya CEDF Sino-Philippine Tourism Investment Corp., as Chinese company.
“First of all, I would like to point out that Grande and Chiquita have not been sold—they are still the property of the Philippine government,” Eisma said. “But there is an investor-company renting the islands, and which has committed P180 million to build a five-star hotel, restaurant and recreational facilities on these properties.”
“If someone would want an investigation of the Grande Island investment project, then I say, by all means get on with it!” Eisma reacted on Thursday. “In fact, we are highly encouraging this group calling for an official investigation so that this matter can be resolved once and for all,” Eisma added.
The SBMA chief noted that while the proposed project by the Chinese investor-company has been “in deep-freeze” after the SBMA objected to some of the development plans two years ago, “some people are maliciously using it as an example of ‘creeping Chinese invasion’ in the country.”
“As much as that group, the Pinoy Action for Governance and the Environment (PAGE), says it has had enough of intrusions into our country’s exclusive economic zone, I would say that the SBMA, too, has had enough of speculation over the nature of this tourism project here,” Eisma said.
From the viewpoint of the SBMA, which is one of the country’s top investment promotion agencies, the Grande Island development project is a legitimate investment proposal in a Philippine special economic zone where 100% foreign ownership of business enterprises is allowed.
The SBMA Business and Investment Group said the Grande Island development project started in July 2000 with Silver Dragon Cruises Inc. (SDCI) entering into a lease agreement with the SBMA to rehabilitate Pier 684 on Grande Island and operate a ferry service within Subic Bay.
In June 2002, SDCI entered into a Lease and Development Agreement (LDA) with the SBMA to develop Grande and Chiquita Islands, but soon assigned its leasehold rights to GFTG Holdings Corporation in September 2002.
The SBMA said that over the years, it has approved various amendments to the agreement with GFTG, including escalation of revenue shares, extended leasehold period, special provision for developing and marketing housing units, and changes in ownership of what has become GFTG Property Holdings Corp.
Eisma said the biggest change in GFTG occurred in January 2019 when it brought in Sanya CEDF as its biggest shareholder, with 79.99% ownership of the firm. However, in May 2019, the SBMA Board of Directors withdrew its consent to the change in the control and ownership of GFTG, noting that the changes were made without its approval, thus violating the LDA between SBMA and GFTG.
At that time, the SBMA also noted that the Sanya-controlled GFTG had proposed to build 80 ultra-high-end housing units over the water along the coastline of Grande and Chiquita islands. This, Eisma pointed out, was not allowed due to Constitutional limits giving the use and enjoyment of archipelagic waters exclusively to Filipino citizens.
Eisma said that ever since 2019, the Grande project has been in a limbo—for the SBMA, as well as for the investor. “The company continues paying rent for the property, but no new development has taken place—which is sad because Grande is Subic’s tourism jewel and it’s just going to waste,” she stressed.
Eisma added that if there may be some security concern over Grande Island because of its strategic location, then this is the best time to bring out and resolve the issue. “We welcome the call for a Senate investigation, but let me add that let’s take it very seriously. I hope the call was made not only for the purpose of grandstanding,” she added.