The Philippine government has decided to terminate the procurement plan for the modernization of five regional airports using the public-private partnership (PPP) scheme, as it intends to take a different approach to developing these projects.
In a statement, the PPP Center said it received confirmation that the procurement of the development, operation, and maintenance of the New Bohol (Panglao), Davao, Iloilo, Laguindingan, and Bacolod airports has been terminated.
PPP Center said the government, through implementing agencies Department of Transportation (DOTr) and Civil Aviation Authority of the Philippines (CAAP), decided that the projects would be implemented through other modes.
Finance Secretary Carlos Dominguez III had earlier announced the government’s preference for “hybrid” PPP deals, in which the government builds infrastructure projects and later bids out their operation and maintenance to the private sector.
The regional airport projects were originally approved under a bundled PPP structure by the National Economic and Development Authority (NEDA) Board and the Investment Coordination Committee (ICC).
“With the approval, a transparent and credible PPP procurement process commenced following the Build-Operate-Transfer (BOT) Law and its implementing rules and regulations. This generated strong interest from the private sector, as evidenced by the active participation of highly-qualified local and international players,” PPP Center said.
But in November 2016, the NEDA Board approved the unbundling of the five airport projects. This meant an adjustment in the milestones of the procurement processes, such as the pre-qualification and bid submission dates targeted for June and December 2017, respectively.
“While the PPP Center believes in the credibility of these airport projects structured as PPP, and gratefully acknowledges the solid interest of the private sector, we respect DOTr’s and CAAP’s authority and their decision to terminate the Projects,” PPP Center said.
“Notwithstanding this development, the PPP Center remains ready and committed to support government agencies in their infrastructure and development projects. The critical foundations of the PPP Program have been laid down, and the institutions, both in the public and private sectors, are ready to deliver,” it added. PPP Center is an agency attached to NEDA that is mandated to facilitate the implementation PPP programs and projects.
The center also noted the effectiveness of the PPP program as shown by the outcome of awarded PPP projects such as Mactan Cebu International Airport (Passenger Terminal Building, NAIA Expressway, PPP for School Infrastructure Project, and the Automated Fare Collection System (AFCS) or Beep Card.
“It is clear that PPPs remain as a viable option in the procurement of infrastructure projects, especially those that require an integrated approach (i.e. design-build-operate-maintain) in order to save on procurement timing, reduce interface risks, and avail of private sector’s technology and efficiency,” the center pointed out.
It said it continues to collaborate with government agencies and the private sector to fulfill the country’s infrastructure requirements, significantly contribute to the government’s “Build, Build, Build” program, and deliver much needed public services.
Image courtesy of Stuart Miles at FreeDigitalPhotos.net
