The Duterte administration is still considering San Miguel Corp.’s (SMC) unsolicited proposal to build an airport in a land owned by the diversifying conglomerate in Bulacan, according to the National Economic and Development Authority (Neda).
Socioeconomic Planning Secretary Ernesto M. Pernia said the proposal is currently undergoing technical evaluation by the Neda, which serves as Secretariat to the interagency Investment Coordination Committee (ICC).
“The airport project in Bulacan is still not dead. It’s still being considered,” Pernia said. “It’s just going to go through the usual process. There’s no special treatment, no commitment.”
Pernia said the Neda will be looking at the proposal’s merits, particularly the conditions attached to the project. Should there be any conditions, the Neda chief said this will be a point against the proposal.
He said he has initially instructed the Neda to just focus on the development of the Clark Airport and the Ninoy Aquino International Airport (Naia) to improve the access and capacities of the two airports.
The Neda chief said this is part of the Duterte admnistration’s aim of focusing on projects that can be completed in three years or within the President’s term.
This focus, Pernia said, sent unsolicited proposals, such as the SMC airport proposal, to the back burner.
“[Earlier] I said we should focus on Clark and the Naia for the meantime because that is really doable, that is what we need in the immediate and short run so that is what we did. In other words, these unsolicited proposals were placed on the back burner so we felt we had to reconsider also,” Pernia said.
“Earlier, it was an announcement, I think the Finance Secretary [Carlos G. Dominguez] said we welcome unsolicited proposals so we wanted to honor that statement. But as I’ve said, it will go through the process,” he added.
Pernia said should the Neda find merit in SMC’s proposal, the proposal will still have to go through Swiss Challenge, a process by which other private groups could still come forward to make an offer to match the bid of the proponent.
He added that the location of the airport in Bulacan also needs to be studied in terms of accessibility. While the government, through the Philippine National Railway (PNR), has the Manila-Clark Railway project, the station in Bulacan is not near the location of the airport.
This can be addressed through the National Transport Policy (NTP), which, the Neda said, was approved in the last Neda Board meeting. It envisions a national transport system that is “safe, secure, reliable, efficient, integrated, intermodal, affordable, cost-effective, environmentally sustainable and people-oriented”.
The policy, the oversight agency said, will synchronize decisions and investments of all transport-related agencies and better coordinate such efforts between the national and local levels.
Pernia said the primary goal of the Duterte administration is to translate the Philippine Development Plan (PDP) 2017-2022 into actual programs that will benefit Filipinos.
“The government assures the people that the problem of congestion on the roads is still being prioritized. The NTP is a priority strategy reflected in the PDP as we seek to provide accessible social services through better connectivity,” Pernia earlier said.
In January the Neda advised against using unsolicited proposals to build the New Manila International Airport (NMIA).
This was the recommendation Neda made to the Department of Transportation (DOTr) in a letter to Transportation Secretary Arthur P. Tugade dated October 27, 2016, signed by Neda Undersecretary and, at that time, Officer in Charge Rolando G. Tungpalan.
The letter was sent by Neda in response to the DOTr’s request to review the unsolicited airport proposal made by SMC.
“Given the numerous proposals received with regard to the development of NMIA, you may wish to subject the project to a competitive bidding rather than through unsolicited mode, unless SMCH has been accorded by your department an original proponent status,” according to a copy of the letter obtained by the BusinessMirror.
With the current administration’s openness to unsolicited projects, there are at least five groups keen on undertaking the NMIA.
These groups include SMCH, which is reviving its $10-billion-worth airport proposal in Bulacan under the Aquino administration; the DM Wenceslao Group, which is proposing a combined airport and shipping port project in Sangley; and the Sy and Tieng Group, which is proposing a $50-billion-worth airport and economic zone in Sangley.
The Neda also said the New San Jose Builders group has also proposed to include an airport in its Manila Bay flood-defense project, while the Okada group is looking to increase its investments in the country by participating in the bidding for the NMIA.
If the DOTr decides to conduct competitive bidding for the project, this means that the performance requirements or project specifications will be drawn up by the government.
These requirements may include components, such as the capacity of the terminal, the number of runways, access to and from the airport and other key aspects that will allow the NMIA to meet the country’s needs.
The DOTr will also have to finalize the bid parameters, such as sovereign guarantees or premium payments, and the award will be granted to the group that offers the highest net present value.
This means that if sovereign guarantees were chosen, the government will award according to the lowest subsidy sought. In terms of premium payments, the award will go to the company/group that will provide the highest offer.
Going through a competitive bidding for a project will also promote transparency and prevent naysayers from claiming that the choice of the unsolicited proponent was made through a “sweetheart deal”.