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Defense Secretary Delfin Lorenzana said on Wednesday he suggested to President Rodrigo Duterte the government's possible takeover of troubled shipbuilding firm Hanjin Heavy Industries and Construction-Philippines.

"I proposed that scheme (takeover) to him (Duterte) yesterday," he said.

Duterte presided over a command conference with defense, military and police officials in Malacanang on Tuesday.

"Why? It's perfect: we have a shipbuilding facility that would build and repair our Navy and Coast Guard ships," Lorenzana said when asked why he made the proposal.

But Lorenzana said Duterte ‘’did not disapprove nor approve’’ his proposal. He added ‘’it is expected that an interagency committee will look into this.’’

But Presidential Spokesperson Salvador Panelo, in a text message to reporters, said the government's possible takeover of the South Korean affiliated firm in Subic Bay, Zambales is still a proposal.

"It's just a proposal by Secretary Lorenzana. No decision from PRRD (Duterte)," he said.

Lorenzana's proposal came after former Philippine Navy chief Alexander Pama, in his Facebook post earlier, warned that allowing Chinese firms to takeover Hanjin has significant security implications.

The Department of Trade and Industry has said that at least two Chinese firms have expressed interest to invest in the debt-saddled firm.

"Let’s be aware that this Hanjin shipyard issue is not just about business, financial and other economic issues. This is a very significant national security issue! The ownership of Hanjin shipyard in Subic Bay will give the owners unlimited access to one of our most strategic geographic Naval and Maritime asset," Pama said.

While Hanjin is a commercial shipyard, Pama said, "nothing can prevent the owners from making it into a de-facto Naval base and a maritime facility for other security purposes! Let us all be aware and wary of the serious security and other strategic implications of this issue!"

The Philippines and China are engaged in a territorial row in the South China Sea.

Hanjin will undergo rehabilitation after the Olongapo City Regional Trial Court placed it under receivership due to its $412 million debt to five banks. Celerina Monte/DMS