Fidel Ramos defends land deal in face-off with old foe

Former president Fidel Ramos defended himself yesterday against charges of corruption in the controversial Smokey Mountain project, coolly answering the accusations of his political enemies.

Mr Ramos was the second head of state to be called to account for previous presidential actions by the Senate Blue Ribbon Committee, the special body that investigates government corruption.

Two years ago, former president Joseph Estrada appeared before a Senate committee to deny receiving US$14 million in return for approving a power plant deal.

Mr Ramos took full responsibility for starting the complicated business deal that granted a private construction firm, R-II Builders, the right to own 79 hectares of reclaimed land. In exchange, the company was required to construct at its own expense 33 multi-storey residential buildings for the 21,000 people living as scavengers on Smokey Mountain, Manila's infamous seven-storey rubbish dump.

The homes remain unfinished, but Reghis Romero, who owns R-II Builders, had built a private port facility beside Smokey Mountain, and earned 13.2 billion pesos (HK$1.8 billion) by selling some of the reclaimed land, Senator Miriam Santiago told Mr Ramos.

Ms Santiago criticised Mr Ramos for continuing a project for which government-controlled pension funds ultimately footed most of the bill. This violated the original contract, she said.

Mr Ramos denied ordering the pension funds to invest in the project. He insisted the project was financed through the issuance of commercial papers, which were then sold to banks, including the pension funds, as an investment.