Marcos govt says Philippines is terminating Russian helicopter deal

The new government in the Philippines announced Wednesday that it was canceling a contract to buy 16 military helicopters from Russia, weeks after the former defense chief said Manila planned to scrap the deal because of potential American sanctions over Moscow’s war in Ukraine.

The Department of National Defense (DND) said it formed a committee to formalize the withdrawal from the military procurement contract worth about 12.7 billion pesos (U.S. $244.2 million). 

Signed under the Duterte administration in November 2021, the deal called for the purchase of 16 Russian-made Mil Mi-17 helicopters, with an additional unit of this Soviet era heavy-lift aircraft to be included at no extra cost.

“We have reconstituted the DND Contract Termination and Review Committee … that will undertake the appropriate processes and exercise due diligence in formalizing the termination of the project’s contract,” department spokesman Arsenio Andolong said.

“We are also preparing to initiate a diplomatic dialogue with the Russian side regarding matters arising from the project’s cancellation.” 

Alluding to potential consequences from the Russian invasion of Ukraine in late February, Andolong noted that “changes in priorities necessitated by global political developments resulted in the cancellation of the project by the previous administration.”

In early March, the defense department had said it intended to go ahead with the purchase despite sanctions by Western nations over the Russia-Ukraine war.

Under the contract, the Russian firm Sovtechnoexport LLC would deliver the Mi-17s to the Philippine Air Force, a military branch looking to modernize its fleets.

A heavy-lift helicopter is a rotary aircraft capable of lifting large numbers of personnel or big amounts of cargo. The model of helicopter is known as the Mi-8M series among the Russian armed forces.

Two weeks ago, Delfin Lorenzana, the defense secretary under former President Rodrigo Duterte, announced that the government had canceled the deal. But on Wednesday, Andolong clarified that Lorenzana had merely voiced the government’s intention, but that this caused some confusion.

Under Lorenzana, the department had made a down payment of two billion pesos in January. The delivery of the helicopters was supposed to start in November next year, or 24 months after the contract was signed.

Lorenzana said he canceled the contract on June 25, five days before the end of the Duterte administration. He said President Duterte wanted the contract canceled due to possible sanctions from the U.S.

Lorenzana was referring to sanctions under the Countering America’s Adversaries Through Sanctions Act of 2017, which prohibits countries from purchasing Russian military hardware.

“He [Lorenzana] started the [termination] process already by serving notice of our intention to cancel the contract. Now, there are procedures involved to formalize it,” Andolong told reporters in an interview on Wednesday.

“It’s not yet terminated, we have to complete the process although his letter to the Russians already constitutes the start of the process, the intent is already there,” he added.

When reporters asked him if the DND was confident it could recoup the payment already made to the Russians, Andolong said it was too early to say.

Western nations, led by the United States, meanwhile have imposed strict economic sanctions on Russia to punish President Vladimir Putin for the invasion of neighboring Ukraine.

The sanctions have included a ban on all imports of Russian oil and gas, the freezing of assets of Russian banks, restrictions on oligarchs and other high-powered Russians close to the Kremlin, and a slew of other measures, according to news reports.

While the Philippines condemned the Russian invasion, Lorenzana had initially said that the country had no business meddling in Moscow’s affairs.