Manila, March 4, 2003 -- The Department of Foreign Affairs (DFA) yesterday confirmed the existence of a $100-million palm oil production deal being hammered out by the Arroyo administration with the Malaysian and Libyan governments for the development of Central Mindanao.

“It's supposed to be confidential,” said a reliable Foreign Affairs source when asked about the proposed palm oil project in the Liguasan Marsh area in North Cotabato.

But presidential spokesman Ignacio Bunye, during a press briefing, said the project was never a secret although he failed to comment on whether recent military operations against the Moro Islamic Liberation Front (MILF) in the area were aimed at clearing the path for the joint palm oil project.

“In the first place, it (President Arroyo's deal with Libyan leader Moammar Gadhafi) was not a secret. We have been announcing the Al Gadhafi Foundation headed by the Libyan leader's son, Sayf Al Islam, had expressed keen interest in the area,” Bunye added.

He said the government would push through with the project despite differences between Libya and the United States.

The US does not look kindly on Libya and its leader, Gadhafi, or his foundation, which is suspected to be a money front for funding terrorist activities.

“We're going to have the joint venture pushed through with the National Development Corp. for the development of the North Cotabato area for the palm oil tree plantation,” Bunye said.

When asked if Mrs. Arroyo's pact with Gadhafi on the project would cause conflict with the US, which had been busy seeking alliance with countries like the Philippines in its global war on terrorism, the presidential spokesman evaded the issue.

He answered, “We're interested in the development of the area. We know that the military offensive (against the MILF) has effectively stopped. There are no more operations so we are now going for a long-term development of that area.”

Malacañang also downplayed any possibility of retaliation from MILF leader Hashim Salamat, who is said to live in the area but was driven away by the military during the assault on the Buliok Complex.

“I think everyone would benefit from this development and that includes even rebel returnees in case they return to the fold of the law,” Bunye said.

The Liguasan Marsh area is the site of the 2,000-hectare Buliok Complex, where the former MILF-controlled Camp Rajamuda is located.

The complex was also the scene of a military offensive against the MILF as ordered by the President to flush out members of the Pentagon Gang reportedly seeking refuge in the camp.

But an Asian diplomat, who spoke on a condition of anonymity, earlier contested the military offensive saying, “If you notice, there were no Pentagon Gang members caught or killed and the MILF (members) were just swept out of that complex to clear the path for the Libyan palm oil project.”

The project, another source disclosed, was the brainchild of Presidential Adviser for Special Concerns Norberto Gonzales.

Other sources bared it it was proposed by Gonzales to the President in 2001, a month after Mrs. Arroyo assumed the presidency through a coup d'etat that ousted the now detained Joseph Estrada.

The palm oil project, the sources said, is a “concession” promised by Gonzales to Libya and Malaysia if they will agree to “actively” mediate in the peace talks between the government and the MILF.

“It appears that the project is tied up to the peace talks,” a source said.

Malaysian and Libyan Embassy officials in Manila declined to give their comment on the issue.

It was not clear if the DFA was consulted on the palm oil project.

“Before we, the DFA, knew about this, this proposal has already reached the President and was subsequently approved by her,” a source at the department said. They said they know nothing about the President's plan to send a personal envoy to Libya to discuss charitable projects for Mindanao.

The Asian diplomat quoted by the Tribune in its exclusive report on the palm oil project published yesterday warned that Mrs. Arroyo was playing a dangerous game as she fosters relationship with Libya while at the same time acting as a staunch supporter of the US to gain economic and financial assistance.

He said the reason for the government's reluctance to have the MILF declared by the US as a foreign terrorist organization is that it would present difficulties for Libya in mediating the peace talks with an FTO while preparing to establish the $100-million project in Mindanao.

Meanwhile, opposition senators also yesterday said the deal only proves that the military operations in the South were meant to seize control of the petroleum-rich Liguasan March area, not to crush insurgent and terrorist groups.

“Definitely, the Liguasan Marsh is a prize (catch) that any foreign investor or local enterprise would like to have its hands on. It has been a potential agricultural site. It is also known to have petroleum reserves under it. So... it's certainly an area that the national government, not the MILF, would be interested in recovering,” Osmeña said. (By Michaela P. del Callar, Sherwin C. Olaes and Angie M. Rosales, Tribune)

Reported by: Sol Jose Vanzi

All rights reserved