The private sector is gaining confidence in public-private partnership projects as the government mulls joining a China-led development bank to help narrow the infrastructure gap
MANILA, Philippines â The new administration in 2016 would have to learn a lot of the lessons from how the current administration handled public-private partnerships (PPPs), and this would take a few years, said Ramon Ang, president of San Miguel Corporation (SMC).
âTo maintain momentum, I hope we bid out as many of the additional PPP projects planned as we can before the current administration ends,â Ang said in an infrastructure discussion at the Euromoney Investment Forum on March 24.
Ang said on March 23 during the SLEX-TR4 project briefing that the conglomerate is setting aside billions to put the countryâs toll roads on a par with those in neighboring countries in Asia.
âWe look at infrastructure as an opportunity to participate in the growth of our country. Quality infrastructure will change and impact lives,â Ang said.
The Aquino administration was initially slow but the sizes of the projects that are being bid out are growing â 9 are underway with 16 to be rolled out, said Jorge Consunji, president of DM Consunji.
âWe welcome this and we hope it will continue,â Consunji said.
Consunji’s DMCI was awarded the civil works contract to complete within 18 months the elevated guideway or viaduct for the Light Rail Transit line 2 project.
Vote of confidence
The private sectorâs increasing confidence in the PPPs played a significant part in the momentum.
But there are generally no power projects among the PPPs, said Eduardo Francisco, president and chief executive officer of BDO Capital and Investment Corporation.
This is because private firms can do power projects by themselves, supported by merchant banks, Francisco explained.
âTransitioning power projects to PPPs is the same â proponents are bidding without any government guarantees for profit. So the banks have gotten themselves comfortable supporting these projects,â Francisco said.
Banks are also coming up with a âstaple financing,â which pre-analyzes a project and finances whoever the winning bidder is as long as it is pre-qualified, he explained.
BDO has done it for some projects and is looking at doing the same for the many projects that are coming along, Francisco confirmed.
The growing confidence the private sector has in the PPP projects was reiterated by Department of Public Works and Highways (DPWH) Secretary Rogelio Singson.
âWe offered viability gap funding for all the toll roads we bid out, but no private firm took it so itâs an indication of the confidence the private sector has in these projects,â Singson said.
He also acknowledged that initially, the unsolicited mode as a method of getting PPPs bid out caused some delays, like that experienced in the North Luzon and South Luzon expressways (NLEX-SLEX) connector road project.
The government still needs to address right-of-way issues. But success would be evident if all of the PPP projects that DPWH initially lined up are bid out.
âWe hope to have the remainder bid out by the middle of this year. If we close them all, weâre done as far as DPWH is concerned,â Singson confirmed.
To date, DPWH set July 7 for the issue of notice of award to the winning bidder for the controversial Cavite-Laguna expressway project.
Asian Infrastructure Investment Bank
The current administration is also mulling joining the China-led Asian Infrastructure Investment Bank (AAIB) to help bridge the infrastructure gap in the country.
The government is gathering information on the AIIB before it makes its final decision by June, Finance Secretary Cesar Purisima said at the sidelines of the forum.
“We are part of several meetings, but the President (Benigno S. Aquino III) has not yet made a decision whether we will join or not,” Purisima said.
The Philippines, along with other countries, signed in October a non-binding agreement to become a founding member of the $50-billion multilateral institution that would finance infrastructure projects in the Asia-Pacific region.
Switzerland and Luxembourg were the latest nations to declare their intention to join the institution that is viewed by some to be a rival to the Manila-based Asian Development Bank (ADB), as well as the World Bank.
Japanese officials had previously expressed concern about the new bank’s transparency standards, while the United States is reportedly fiercely opposed to the AIIB.
Despite such, Purisima believes that the AIIB is âfinancial and economic in nature,” and has no relation with the territorial conflict between China and the Philippines over the West Philippine Sea. â Rappler.com
Rappler, 25 March 2015
By Chris Schnabel
MANILA, Philippines – A modern ticketing system will be in place at the Light Rail Transit Line 2 by May.
More than 80 ticket vending machines and 100 new turnstiles have already been installed in LRT 2 stations.
The new vending machines can dispense tickets, single journey and stored value card, which can be loaded from P11 to up to P10,000. These cards can last up to 4 years.
Once implemented, the magnetic stripe tickets currently in use will be replaced by contactless, tap-and-go smart cards that come with a microchip much like Hong Kong’s Octopus cards and Singapore’s EZ link.
The new ticketing system is scheduled to be used by the commuters by May. It will be in place for MRT-3 by June and for LRT-1 by July.
“The new system will work together with the old system. This is the best way to introduce the system” Peter Maher, CEO of AF Payments, said.
Maher said they chose to start using the system in LRT 2 first to try the system on a railway with less ridership.
“LRT-2 is the least busy of the lines. It is also the summer holidays for the colleges. So the riders are not that busy and we are able to see and adjust the system without too much hassle,” he said.
The passengers will only tap the card on the new machines and then walk through the turnstile.
The new ticketing system will speed up payments substantially, lessen queuing time and allow commuters to transfer from one rail line to another seamlessly.
The AF Consortium, led by Metro Pacific and Ayala, is undertaking the project after it was awarded the P1.72 billion automatic fare collection system (AFCS) contract by the Department of Transportation and Communications.
The AF consortium includes AC Infrastructure Holdings Corp., BPI Card Finance Corp., Globe Telecom, Meralco Financial Services Corp., MPIC and Smart Communications.
ABS-CBN News, 26 March 2015
By Jacque Manabat
SPANISH companies âare eager to win some biddingsâ for Philippine infrastructure contracts despite an âunfortunate precedent,â Spanish Ambassador to the Philippines Luis Antonio Calvo told BusinessWorld during his courtesy call on Tuesday.
The âunfortunate precedentâ involved the Cavite-Laguna Expressway (CALAx) project, which was rebid in February after it was auctioned off in June last year.
The government ordered a new auction in November after Optimal Infrastructure — one of the bidders — sought MalacaĂąangâs intervention due to its disqualification on a technicality concerning its bid security. Of the four original bidders, only MPCALA and Optimal Infrastructure have renewed their bid bond — a guarantee that they have the financial muscle to carry out the project should they bag the contract.
Mr. Calvo clarified that they âstill have the hope that we will be able to win one of these big contracts.â
Spanish company OHL Concesiones, S.L. was part of the Team Orion consortium where it was a prospective operations and maintenance contractor for CALAx.
Business World, 25 March 2015
By Elizabeth E. EscaĂąo
MANILA, March 26 –The Public-Private Partnership (PPP) Center of the Philippines was recognized as Asia Pacific Grantor of the Year, in recognition of its role as a government body that advises awarding authorities on the procurement of infrastructure projects during the annual IJGlobal Asia Pacific Awards 2014 held at Singapore last March 24.
IJGlobal Infrastructure Journal and Project Finance Magazine recognizes excellence, achievement and innovation in energy and infrastructure finance. It also honors excellence of market participants by naming outstanding public and private sector players in the region.
The awarding body is composed of industry leaders in the various areas of international infrastructure finance.
This is the second international award bagged by the PPP Center after winning last yearâs Best Central/Regional Government PPP Promoter of the UK-Based Partnerships Bulletin. For 2015, the PPP center is shortlisted again for the said category. Two projects, the PPP for School Infrastructure Project (PSIP) Phase II and Automatic Fare Collection System (AFCS) Project, have also been shortlisted as Best Education Project and Best Transit Project, respectively.
âWe feel very honored to receive this international recognition. This reflects the hardwork and efforts of our institution as the main driver of Public-Private Partnership program in the countryâ, PPP Center Executive Director Cosette V. Canilao said.
âThis recognition will serve as our inspiration to continuously produce well-structured PPP infrastructure and development projects that will sustain the interest and participation from the private sectorâ, Executive Director Canilao added.
The government has already awarded nine PPP projects since 2010 with a total indicative cost of Php 136.37 billion which are the Daang Hari-SLEX Link Road Project, PPP for School Infrastructure Project (PSIP) Phase I, NAIA Expressway (Phase II), Project PPP for School Infrastructure Project (PSIP) Phase II, Modernization of the Philippine Orthopedic Center (MPOC) Project, Automatic Fare Collection System (AFCS) Project, Mactan-Cebu International Airport (MCIA) Passenger Terminal Building Project, LRT Line 1 Cavite Extension and Operation & Maintenance and Integrated Transport System-Southwest Terminal Project.(PPP)
Philippine Information Agency, 26 March 2015
MAKATI CITY, 25 March (PIA)–President Benigno S. Aquino III highlighted on Tuesday the economic growth gained by the country under his leadership.
In his keynote speech during the Philippines Investment Forum held at The Peninsula in Makati, Aquino bared his administrationâs achievements that resulted in improved economy, including the 2014 net Foreign Direct Investments (FDIs), that reached an all-time high of $6.2 billion, 65.9 percent higher than the 2013 figure.
“The tremendous amount of confidence the global community has developed towards the Philippines is incredibly gratifying, especially considering that not too long ago, we were considered the sick man of Asia,â Aquino said.
“Our administration remains hard at work so that we can maximize all opportunities available to us. I think many of you will agree with me when I say, you ainât seen nothing yet,â he added.
The Chief Executive bared that the Department of Public Works and Highwayâs (DPWH) budget has more than tripled: from P165 billion in 2010, to almost P570 billion in 2015.
âWe can expect this to grow even more, as our goal is to have infrastructure spending comprise five percent of GDP by 2016,â Aquino said.
Alongside with these, Aquino assured that the government is pursuing an entire menu of options to address the projected shortfall of energy during the dry-season including the use of alternative energy sources and building of new power plants.
âWe are expediting the rehabilitation of the 300 MW Malaya Thermal Power Plant Unit 1 to help augment power supply in Luzon. We are also requesting the National Grid Corporation of the Philippines to optimize the dispatch of hydropower plants, which will generate additional energy supply during peak hours,â Aquino said.
Despite all these, Aquino lamented the good news has often been relegated to the back pages of broadsheets.
âI must admit: our campaign to change the mindset that negativism sells is still a work in progress,â Aquino said.
The 4th Philippine Investment Forum gathered over 500 business leaders, investors and policy makers to discuss the countryâs economic prospects and challenges for 2015/2016. (PIA-NCR/RJB/SDL)
Philippine Information Agency, 25 March 2015
By Susan G. de Leon
THE GOVERNMENT will open the door in June to companies that intend to outdo Manila North Tollways Corp.âs (MNTC) P18-billion offer to link the North Luzon Expressway (NLEx) and South Luzon Expressway (SLEx), officials from the Department of Public Works and Highways (DPWH) said on Tuesday.
This follows the National Economic and Development Authority (NEDA) Boardâs decision in February to move forward with the unsolicited proposal, which involves the construction of an elevated road connecting the two expressways.
MNTC is the tollways unit of infrastructure conglomerate Metro Pacific Investments Corp. (MPIC) that currently operates NLEx and had long been seeking to connect that expressway to the southern corridor exiting Metro Manila.
âThat was already approved by NEDA Board, so now we can publish ITB (invitation to bid) within the year,â DPWH Secretary Rogelio L. Singson said on the sidelines of Euromoneyâs Philippine Investment Forum in Makati City on Tuesday.
Asked for more details, Ariel C. Angeles, officer-in-charge and director of the Public-Private Partnership Service of DPWH, said in a mobile phone reply: âWe hope to publish in June. We are just sorting out some terms with MNTC.â
In February, the NEDA Board ruled that the contract should be bid out via Swiss challenge — the course the government takes when dealing with unsolicited proposals, which requires an invitation to make competing offers while giving the original proponent the right to match them.
MNTC first submitted an unsolicited proposal in 2010 for the connector road, and on Jan. 21 last year, signed a joint venture agreement with state-run Philippine National Construction Corp. — the holder of the NLEx franchise — to build that road.
But several months later, the Department of Justice (DoJ) issued an opinion on the joint venture proposal, saying that the NEDA Board approval of the agreement between MNTC and PNCC is âwithout factual basis or justification.â
The DoJ opinion also stated that the DPWH, under Section 3 of the Build-Operate-Transfer Law, could proceed with the consideration of the unsolicited proposal.
The MNTC proposal was then again subjected for NEDA review.
âAs of now, no companies have expressed interest,â Mr. Singson said, though he noted that absence of interest thus far is no reason not to proceed with a Swiss challenge, âbecause thatâs the legal process.â
Sought for comment, Metro Pacific Tollways Corp. (MPTC) President Ramoncito S. Fernandez said on the sidelines of the same event: âWeâre ready for the Swiss. We are just waiting for the government to invite proponents. Weâll fight for it.â
The original unsolicited proposal of MNTC involved a 13.5-kilometer elevated road that will connect North and South Luzon expressways, including a five-kilometer common alignment from the Polytechnic University of the Philippines (PUP) to Buendia Avenue in Makati City.
Citra Metro Manila Tollways Corp., which is also pursuing its own proposed connector road project with San Miguel Corp., has already obtained financing for the common alignment portion of the road. The San Miguel groupâs P26.5-billion Metro Manila Skyway Stage 3 project is a six-lane 14.8-kilometer expressway, from Buendia Avenue in Makati City to Balintawak in Quezon City, connecting the SLEx to NLEx.
MalacaĂąang approved the contract for the Skyway Stage 3 project in September 2013.
The NLEx-SLEx connector road would link C-3 in Caloocan City to the PUP campus in Sta. Mesa, Manila. Parts of the segment would run above the lines of the Philippine National Railways.
MPIC is one of three major Philippine units of Hong Kongâs First Pacific Co. Ltd., the others being Philippine Long Distance Telephone Co. (PLDT) and Philex Mining Corp. Hastings Holdings, Inc., a unit of PLDT Beneficial Trust Fund subsidiary MediaQuest Holdings, Inc., has a majority stake in BusinessWorld.
Business World, 24 March 2015
By Chrisee Jalyssa V. Dela Paz
President Benigno Aquino 3rd called on investors to place their money on the Philippines as he boasted that his administration is âmaking historyâ in terms of economic gains and promising that greater things are yet to come.
Speaking at the Euromoney Philippine Investment Forum held in Makati City, Aquino cited the economic gains during his term, ticking off other accomplishments such as record foreign direct investments, improved global competitiveness and credit rating upgrades.
The president said these economic gains âhave led to even greater optimism for our countryâs prospects.â
âTo those who are here to take a closer look at the Philippines, I invite you: Bet on the Filipino people, and discover for yourself how itâs more fun and more profitable to do business in the Philippines,â he said.
âIf, on the other hand, you decline this invitation, perhaps I may pose a question, how confident are you that you will never say: we missed such a good opportunity?â he added.
âThe tremendous amount of confidence the global community has developed for the Philippines is incredibly gratifying, especially considering that, not too long ago, we were known as the âSick Man of Asiaâ,â Aquino said. âHowever, our administration remains hard at work so that we can maximize every opportunity available to us, and I think many of you will agree with me when I say: You ainât seen nothing yet.â
The president said the Philippines is âpoised for even more successâ and âthere is indeed much reason for optimism.â
âThese past few years, our people have proven themselves to the world. But having been exposed to the skill, talent, loyalty, and resilience of so many of our countrymen, I know that we have only scratched the surface,â he said.
Aquino said his administration allotted a bigger budget for the Department of Public Works and Highways from P165 billion in 2010 to almost P570 billion in 2015, and to have infrastructure spending comprise five percent of GDP by 2016.
He said his administration is also focused on accelerating infrastructure development through the Public-Private Partnership program (PPP).
Under his watch, Aquino said nine projects have been awarded, 16 are in the process of being bid out, and over 30 other projects are in various stages of development.
He said the government is focused on developing the power supply situation, noting that â48 committed incoming power projects with 4,693.6 megawatts of power are expected to come online between now and 2018.â
âOut of these 48 power plants, 21 will be from renewable energy, in line with our goal of diversifying our energy mix and building a power supply that is as clean and reasonably priced as possible,â the president said.
âAs you can see, we are determined to continue treading green pathways to development, and to maintain our status as one of the driving forces for clean energy in the region,â he added.
President Aquino also addressed the realization of the Asean Economic Community (AEC) expected by the end of the year, saying Philippines âis taking every possible measure to take on a more dynamic economic role in the region.â
âOur compliance rate in the AEC scorecard in terms of our commitments to AEC 2015 is now at around 86 percent. I have already signed crucial laws that will help us meet our financial integration commitments, including an Act Strengthening the Insurance Industry and the Act Allowing the Full Entry of Foreign Banks in the Philippines,â he said.
For the remainder of his term, the government âwill continue expanding the range of financial tools available in our country, so we can maximize the advantages of integration,â Aquino added.
He also discussed the empowerment of micro, small, and medium enterprises (MSMEs) that will âestablish economic dynamos in even the most remote parts of the nation,â which could become âone of the strongest and most direct tools towards inclusive growth.â
To accomplish this, he said the SME Roving Academy has conducted more than 1,871 training sessions focused on skills training, product pricing and costing, business planning, entrepreneurship development, and financial management, which has helped more than 85,000 potential and established entrepreneurs.
Aquino said he also signed the Go Negosyo Act that will build business centers that will offer MSMEs a full range of services, including business registration processing, training sessions and seminars, and the establishment of market linkages.
âBy the end of this year, we intend on putting up 100 of these establishments across the archipelago,â the president said.
âRest assured, our administration will do everything in its power to build on our economic momentum by continuing to invest in the Filipino people,â he added.
The Manila Times, 25 March 2015
By Catherin Valente
MANILA, Philippines – “You ain’t seen nothing yet.”
This was President Benigno Aquino III’s message to investors on Tuesday as he boasted the country’s economic growth under his watch, claiming that the best is yet to come.
Speaking at the Euromoney Philippines Investment Forum in Makati, Aquino cited the economic achievements during his term including the country’s new all-time record in foreign direct investments, improved global competitiveness rankings and the credit rating upgrades.
“The tremendous amount of confidence the global community has developed for the Philippines is incredibly gratifying, especially considering that, not too long ago, we were known as the ‘Sick Man of Asia’,” Aquino said.
“However, our administration remains hard at work so that we can maximize every opportunity available to us, and I think many of you will agree with me when I say: You ain’t seen nothing yet,” he added.
Aquino told investors that the country is “poised for even more success” and that “there is indeed much reason for optimism.”
Despite the country’s economic gains, Aquino said that the “limitless potential” of Filipinos has yet to be “sufficiently measured.”
“I know that we have only scratched the surface.. To those who are here to take a closer look at the Philippines,” Aquino said.
“I invite you: Bet on the Filipino people, and discover for yourself how itâs more fun and more profitable to do business in the Philippines,” he continued.
In his speech, Aquino did not fail to take a swipe at the Philippine media for not trumpeting the country’s economic achievements.
“There has been so much good news these past few years, and yet, this good news has often been relegated to the back pages of our broadsheets. I must admit: our campaign to change the mindset that negativism sells is still a work in progress,” Aquino lamented.
The Philippine Star, 24 March 2015
By Louis Bacani
MANILA – President Benigno Aquino III on Tuesday reiterated the governmentâs commitment to put in necessary infrastructure that would ensure the sustained growth of the domestic economy.
In his speech during the Euromoney-hosted Philippines Investment Forum at The Peninsula Manila, the President said nine projects have been awarded within his term, with 16 in the pipeline.
He said the government is committed to attain its goal of increasing infrastructure spending to five percent of gross domestic product (GDP) by 2016 to sustain the high level of economic growth that the county enjoys.
He said domestic growth averaged 6.3 percent from 2010 to 2013, as against the 4.3 percent during the previous administration.
He, however, stressed that more will still be done especially on infrastructure and power generation.
âInfrastructure is one of the sectors that has greatly benefited from our drive to become more competitive,â he said, attributing this to the Public-Private Partnership (PPP) Program.
On the power sector, Aquino said the country has about 15,665 megawatts (MW) of dependable capacity, which is enough to meet the highest projected demand of about 10,222 MW for 2015.
âBut we cannot be content with this, especially with the potential power supply gap in Luzon this summer, due to the threat of El NiĂąo and rehabilitation of the Malampaya gas field,â he said.
Thus, the government is expediting the rehabilitation of the 300-MW Malaya Thermal Power Plant Unit 1 to help increase Luzonâs power supply.
The government also has asked the National Grid Corporation of the Philippines (NGCP) âto optimize the dispatch of hydropower plants, which will generate additional energy supply during peak hours,â the President said.
He said the Interruptible Load Program (ILP), which is being undertaken with the private sector, has about 688.67 MW of available capacity, which can be tapped when demand rises during the summer months.
Under ILP, customers of distribution utilities (DUs) that have generator sets will be allowed to augment capacity when electricity supply. These customers will then be paid for the fuel used in running their own gensets and on the depreciation of the equipment.
The President said 48 committed projects with a projected capacity of 4,693 MW are scheduled to go online between this year and 2018, ensuring that additional demand for power will be addressed.
He said 21 of these projects use renewable energy (RE), which is in support to the governmentâs bid to tap alternative sources.
âAs you can see, we are determined to continue treading green pathways to development, and to maintain our status as one of the driving forces for clean energy in the region. As I have said before, our vulnerabilities to climate risk should not keep us from exerting maximum efforts in pursuing non-conventional sources of energy. We are hopeful that the rest of the world will see the value in such a strategy,â he added.
InterAksyon, 24 March 2015
By Philippine News Agency
PRESIDENT Aquino on Tuesday committed to further increase his administrationâs multibillion-peso annual spending for various infrastructure and power projects in the remaining 15 months of his six-year term, which ends on June 30 next year.
Speaking before business leaders attending the Philippine Investment Forum at the Peninsula Hotel in Makati City, Mr. Aquino also vowed to continue pouring public funds to other government projects intended to create more jobs.
President Aquino announced his term-ending plans, as Moodyâs on Tuesday increased its Philippine growth forecast for the year at 6.6 percent.
The President affirmed that infrastructure remains one of the sectors that greatly benefited from the governmentâs drive to become more competitive, acknowledging that, through the efforts of the Department of Public Works and Highways (DPWH), âcorruption has been vastly minimized, if not eradicatedâ and projects are now regularly completed ahead of time and under budget, including those started by past administrations.
âThe good news is that the DPWHâs budget has more than tripled: from P165 billion in 2010 to almost P570 billion in 2015. We can expect this to grow even more, as our goal is to have infrastructure spending comprise 5 percent of GDP [gross domestic product] by 2016,â he said.
Mr. Aquino assured that the administration is continuing to pursue another path toward accelerating infrastructure development in the Philippines, through the so-called Public-Private Partnerships (PPP) Program.
âThanks to the good work of those in the Public-Private Partnership Center, we have proved to be exceedingly efficient in executing PPP projects. If you will allow me to make a quick comparison: The past three administrations combined were only able to complete six solicited PPP projects. On the other hand, under our administration, nine projects have been awarded; 16 are in the process of being bid out; and more than 30 other projects are under various stages of development.â
Mr. Aquino reported that another sector his administration is focused on is that of power, which, he admitted, âhas been rather complicated, to say the least.â
âRest assured: We share your concern. Right now, the Philippines has a total dependable capacity of 15,665 megawatts (MW), which isâor should beâsufficient to meet our highest projected demand level of 10,222 MW for 2015. But we cannot be content with this, especially with the potential power-supply gap in Luzon this summer, due to the threat of El NiĂąo and rehabilitation of the Malampaya gas field,â President Aquino informed the investorsâ forum.
At the same time, Mr. Aquino disclosed that his administration is also pursuing an entire menu of options to address this projected power-supply shortfall.
âWe are expediting the rehabilitation of the 300-MW Malaya Thermal Power Plant Unit 1 to help augment power supply in Luzon. We are also requesting National Grid Corp. of the Philippines [NGCP] to optimize the dispatch of hydropower plants, which will generate additional energy supply during peak hours. Partnerships with the private sector have also proved useful: Under the Interruptible Load Program, as of January 2015, 252 participants have signed up to use their own generators and deload a total of 688.67 MW during times when power supply is too tight.â
According to Mr. Aquino, the good news is that a total of 48 committed incoming power projects with 4,693.6 MW of power are expected to come online between now and 2018. He added that out of the 48 power plants, 21 will be from renewable energy, in line with the governmentâs goal of diversifying the energy mix and building a power supply that is as clean and reasonably priced, as possible.
âAs you can see, we are determined to continue treading green pathways to development, and to maintain our status as one of the driving forces for clean energy in the region. As I have said before, our vulnerabilities to climate risk should not keep us from exerting maximum efforts in pursuing nonconventional sources of energy. We are hopeful that the rest of the world will see the value in such a strategy,â he said.
The President explained that these efforts are even more crucial, in light of the realization of the Asean Economic Community, expected to take place further this year. He noted that Asean remains a formidable economic force, adding that at a time where many countries in the world are experiencing economic uncertainty, it has remained one of the worldâs fastest-growing regions.
âOn top of this, one must consider its size: If Asean were just one country, it would be a $2.4-trillion economy. This is precisely why, as Asean integration takes full effect, the Philippines is taking every possible measure to take on a more dynamic economic role in the region,â he said.
Mr. Aquino reported that he had already signed crucial laws that will enable the Philippines to âmeet our financial integration commitments, including an âAct Strengthening the Insurance Industryâ and the âAct Allowing the Full Entry of Foreign Banks in the Philippines.â Moving forward, we will continue expanding the range of financial tools available in our country, so we can maximize the advantages of integration.â
The President also pointed out that widening the range of financial options in the country also helped another key sector: that of micro, small and medium enterprises (MSMEs), explaining that an empowered MSME sector is one of the main foundations of a healthy economy, as it âenables us to establish economic dynamos in even the most remote parts of the nation; it creates opportunities, giving our countrymen yet another path through which they can take hold of their destinies. Ultimately, it can become one of the strongest and most direct tools toward inclusive growth, and thus, we want MSMEs to take on a leading role in our countryâs growth story.â
This is why, he said, âWe have been working overtime to provide MSMEs the wherewithal to compete and succeed in an increasingly global market. For instance, our SME Roving Academy has conducted more than 1,871 training sessions focused on skills training, product pricing and costing, business planning, entrepreneurship development and financial management, among many others. To date, these have helped more than 85,000 potential and established entrepreneurs.â
President Aquino lamented that âthere has been so much good news these past few years, and yet, this good news has often been relegated to the back pages of our broadsheets,â he told guests at the forum. âI must admit: Our campaign to change the mind-set that negativism sells is still a work in progress.â
Admitting that his administration had its share of setbacks and challenges, Mr. Aquino asserted, âwe also have an impressive number of achievements under our belt. This is why I have made it a point to spread the good news, and why I am always thankful for those who stay balanced and constructive: pointing out areas in which we can improve, while also acknowledging our progress.â
For instance, he recalled that 2014 was âindeed, a banner year for net FDI [foreign direct investments], reaching an all-time high of $6.2 billion, 65.9 percent higher than what we received in 2013.â
âWe have, likewise, posted impressive growth: from 2010 to 2013, the Philippines averaged a GDP growth of 6.3 percent,â he said, adding: âCompare this to the previous three-year period, under my predecessor, where growth was just at 4.3 percent. On top of this: in spite of the lingering effects of Typhoon Haiyan and the uncertainty in the global economy, our country still posted a respectable 6.1-percent GDP growth figure last year.â
According to Mr. Aquino, the Philippines was upgraded to investment grade by all three major credit-rating agencies in 2013, and has continued to receive upgrades since. âWe are, indeed, making history. All these, and many other factors, have led to even greater optimism for our countryâs prospects.â
The President also cited a recent Bloomberg report which, he said, noted that âthe Philippines is forecasted to be the worldâs second-fastest-growing economy in 2015.â
âThe tremendous amount of confidence the global community has developed for the Philippines is incredibly gratifying, especially considering that, not too long ago, we were known as the âSick Man of Asia.â However, our administration remains hard at work so that we can maximize every opportunity available to us, and I think many of you will agree with me when I say: You ainât seen nothing yet,â President Aquino added.
Business Mirror, 24 March 2015
By Butch Fernandez
Diversified conglomerate San Miguel Corp. is adding airports outside Metro Manila to its menu of big-ticket infrastructure projects. The projects are in line with the so-called âpocket open skiesâ policy of the Aquiono administration to encourage traffic in airports other than the main gateway, Ninoy Aquino International Airport (NAIA).
In a disclosure to the Philippine Stock Exchange, the food-to-infrastructure group says it would bid for several regional airports under the flagship Public-Private Partnership program.
âBy way of response to the Exchange, we confirm that the Company shall participate in the bidding for the operation and maintenance of the regional airports consisting of the two packages, namely: the Bacolod-Silay International Airport and the IloIlo International Airport and the Davao International Airport-Laguindingan Airport and New Bohol (Panglao) AirportâŚ,â a San Miguel statement said.
Worth P20.26 billion, the Bacolod-Silay International Airport will be bundled with the P30.4-billion Iloilo International Airport.
The P40.57-billion Davao International Airport will be offered with the P14.62-billion Laguindingan Airport and P4.57-billion New Bohol (Panglao) Airport.
San Miguel bought bid documents for the development, operation and maintenance of the local airports, said the PPP Center, together with J. G. Summit Holdings, Inc. and Megawide Construction Corp.
The projects are in line with the so-called âpocket open skiesâ policy of the administration to encourage traffic in airports other than the main gateway, Ninoy Aquino International Airport (NAIA).
Executive Order 29 issued by President Aquino in May 2011 states that the government panel, in negotiating for air service agreements with other countries, will offer and promote airports other than NAIA, âwithout restriction as to frequency, capacity and type of aircraft.â
San Miguel had proposed a state-of-the-art, multiple runway, inter-modal airport on a reclaimed property along Manila Bay, which will be an alternative to the congested NAIA. This is awaiting government response.
The company is currently building other major projects such as the soon-to-be-completed Tarlac-Pangasinan-La Union Expressway, Skyway 3 that will link the South Luzon Expressway to the North Luzon Expressway, NAIA Expressway that will connect the Skyway system to the three NAIA terminals and the Entertainment City of the Philippine Amusement and Gaming Corp. in Pasay City, and the soon-to-be-constructed Metro Rail Transit Line 7 in Quezon City.
CNN Philippines, 24 March 2015
By Cris Paraiso
THE following is a statement issued by the Asian Development Bank outlining its economic projections for the Philippines in 2015:
Growth in the Philippine economy is set to pick up in 2015 as government expenditure expands and both private consumption and investment remain strong, says a new Asian Development Bank (ADB) report.
ADBâs flagship annual economic publication, Asian Development Outlook 2015 (ADO), released today, forecasts Philippine gross domestic product (GDP) will grow by 6.4% in 2015 and 6.3% in 2016. In 2014, the economy expanded by 6.1%, decelerating by about 1 percentage point from the year earlier on a slowdown in government spending.
âFactors that powered private consumption in 2014 — growth in employment, modest inflation, and higher inflows of remittances — are expected to continue to support solid growth this year,â said Richard Bolt, ADB Country Director for the Philippines. âWhile the economic outlook is bright there is a need to stimulate employment growth and continue efforts to address gaps in infrastructure.â
Private consumption remained the central driver of the economy in 2014, accounting for more than 60% of GDP growth. Private construction rose at a double-digit pace, driven by demand for offices, retail space, and housing. Investment in machinery and transport equipment expanded as well.
However soft government spending in the wake of a Supreme Court ruling against certain government funds weighed on the economy, while damage from Typhoon Haiyan and other storms hurt agricultural output for much of last year. Inflation quickened to 4.9% in August, the highest in 3 years, but then eased on better harvests, additional rice supplies from imports, and plunging global oil prices to average 4.1% in 2014.
Growth is projected to accelerate this year on buoyant private consumption, a solid outlook for investment and exports, and recovery in government spending. The report sees downside risks should recovery in industrial countries stumble, and in potential power shortages on the main Philippine island of Luzon in the summer of 2015.
A key factor in the outlook is the budgeted rise in government spending to more than 18% of GDP — the biggest ratio to GDP in at least a decade. The budget boosts allocations for social services and infrastructure and directs additional support for the development of agriculture, tourism, and manufacturing. A plan approved last October to rehabilitate areas devastated by Typhoon Haiyan will accelerate reconstruction spending.
Inflation is projected to slow to average 2.8% in 2015, due largely to lower fuel prices, although a potential El NiĂąo weather effect in the first half, along with possible power rate hikes, could put upward pressure on prices.
The ADO also highlights the need to stimulate investment and generate more and better jobs. Even when the unemployment rate fell to 6.6% in January 2015, the lowest in 10 years, 2.6 million people remained jobless, half of them aged 15-25 years, and a further 6.5 million were underemployed. Creating good jobs in all sectors is key to reducing poverty.
Inadequate infrastructure is a constraint on investment and the government aims to double outlays on infrastructure from 2% of GDP over the past decade to 4% in 2015 and further to 5% in 2016. Further progress on the governmentâs public-private partnership program will help to achieve this ambitious target. Achieving higher levels of investment also requires reforms to enhance competition, improve regulatory efficiency, and reduce the administrative costs of doing business.
ADB, based in Manila, is dedicated to reducing poverty in Asia and the Pacific through inclusive economic growth, environmentally sustainable growth, and regional integration. Established in 1966, it is owned by 67 members — 48 from the region.
Business World, 24 March 2015
By Asian Development Bank
A modernized Philippine Orthopedic Center will be returned to the government after 25 years, but poor patients will continue to have access to âworld-classâ trauma and orthopedic care there, the PPP Center says
MANILA, Philippines âThe government-owned Philippine Orthopedic Center (POC) is up for modernization, not privatization, the Public-Private Partnership (PPP) Center stressed in a statement.
Not only the patients and the patientsâ families expressed their opposition to the reported privatization of the hospital, but also the medical staff, the nurses, and the doctors.
PPP Center said in a statement dated March 20 that through a PPP initiative, the government will retain ownership of the new public hospital facility and poor patients will continue to have access to world-class trauma and orthopedic care there.
The 68-year-old POC, currently located at Maria Clara corner Banawe streets in Quezon City, only has 300 usable beds out of the 700 in the hospital.
âThese conditions have somehow limited the scope of medical services offered in the hospital and affected the quality of care patients get,â PPP Center said.
Thus PPP Center gave assurances that even the poorest of the poor patients will get quality medical care and services in the modernized POC. âThey will not be turned away but shall be treated through the PhilHealthâs Universal Health Care Program,â it said.
The modernization is set to address all of these challenges through the provision of âexcellent orthopedic and rehabilitation care through better services, improved hospital conditions, state-of the-art equipment and facilities, and more efficient operations,â PPP Center said.
âThe new hospital is expected to serve more patients and cover a broader range of ailments considering reduced length of stay and improved medical facilities,â it added.
At present, patients at the old POC stay an average of 16 to 24 days in the hospital. But with the improved POC, patients can expect a shorter stay of 8 to 12 days.
In December 2013, the PPP project was awarded to Megawide-World Citi Consortium. The consortium won the hospital modernization project under the public-private partnership (PPP) deal. The consortium can finance up to 70% of the project cost through borrowings and the remaining 30% through equity.
In October 2014, the consortium said it would borrow up to P3.9 billion ($86.98 million*) to partially finance the P5.7-billion ($127.13 million) POC modernization.
Megawide-World Citi Consortium will infuse not only the requisite funds to modernize POC, but also manage the day-to-day operations and its funding.
The construction of new building and facilities and provision of equipment will be at no cost to the government. The government will only provide the land for POCâs new site.
The Department of Health (DOH) will continue to oversee management of the modernized POC.
After the 25-year cooperation period, the modernized POC will be returned to the government, it added.
Thus, government is not giving up control and ownership to the private sector, PPP Center said. â Rappler.com
US$1 = P44.84
Rappler, 23 March 2015
PROSPECTIVE BIDDERS have been given more time to seek prequalification for the P18.72-billion New Centennial Water Source — Kaliwa Dam Project (NCWS-KDP), an official said.
The Metropolitan Waterworks and Sewerage System (MWSS), the agency in charge for the public-private partnership (PPP) project, has further moved the deadline to submit prequalification documents to next month.
âSubmission of prequalification documents will push through on April 6,â Jose Patrick S. Rosales, project development officer at the PPP Center, said in an e-mail.
The deadline was originally slated for last month but Mr. Rosales said the prospective bidders sought extensions.
âThe move was a response to the request of bidders to lengthen the period for preparing their prequalification submission,â he noted.
This is the third time MWSS extended the deadline for prequalification from the original date of Nov. 17.
MWSS in November identified eight companies that bought prequalification documents and attended the conference for the NCWS-KDP.
These are: San Miguel Holdings Corp.; Filinvest Development Corp.; DM Consunji, Inc.; Megawide Construction Corp.; Prime Metroline Holdings, Inc.; San Lorenzo Ruiz Builders & Developers Group, Inc.; Abengoa Abeinsa Business Development; and Obrascon Huarte Lain SA.
Under this auction process, prequalified bidders will be invited to participate in the actual bidding that is expected to take place within this year although actual date has yet to be finalized.
The NCWS-KDP is part of the efforts of the government to provide another water source for Metro Manila.
âThe objective of the project is to ensure water security, increase Metro Manilaâs raw water supply to meet future potable water demand, and as a redundant water source, thereby reducing total dependency on the Angat Dam reservoir,â according to the invitation to prequalify published last October.
Located in Norzagaray, Bulacan, Angat Dam currently provides more than 90% of Metro Manilaâs potable water.
The NCWS-KDP will involve a 25-year contract for a dam with 600 million liters per day (MLD) capacity, a 2,400 MLD water conveyance tunnel and access roads, as well as bridges and a drainage system in General Nakar, Quezon.
Another water source development project for Metro Manila involving construction of Laiban Dam in Tanay, Rizal will also be auctioned off by the MWSS.
âThis is a very big project, so it will be done in phases. Weâre not sure yet of the timeline for the Laiban Dam but we want to effectively implement the Kaliwa Dam first,â PPP Executive Director Cosette V. Canilao had said in June last year.
Apart from the NWCS-KDP, MWSS has started the bidding process for the P24.4-billion Bulacan Bulk Water Supply Project (BBWSP).
In November, the agency named the prequalified investor groups that can participate in the auction.
These are: the consortium of First Philippine Holdings Corp. and Spainâs Abeinsa Infraestructuras Medio Ambiente, SA; the Filinvest Agua Consortium (composed of Filinvest Development Corp. and Tecnicas De Desalinizacion De Aguas, SA); the consortium of San Miguel Holdings Corp. and Korea Water Resources Corp.; Team Polaris — Manila Water (Manila Water Company, Inc., M.E. Sicat Construction, Inc., and J.H. Patawaran Construction, Inc.); and Prime Alloy Water Consortium (Prime Water Infrastructure Corp., MTD Capital Bhd and the UKâs Biwater International Ltd.).
MWSS is preparing the bid documents for the project, which include instructions to bidders, minimum performance standards and specifications, a draft build-operate-transfer (BOT) contract and draft memorandum of agreement.
The BBWSP will involve the design, financing, construction, development, operation and maintenance of facilities that will supply treated water to 22 Bulacan water districts.
The project — to be conducted in three phases — will be executed via a 32-year BOT contract with the government.
According to an MWSS brief, the BBWSP aims to address the water requirements of Bulacan and eventually reduce groundwater extraction and use of deep wells in the province.
The government has so far awarded nine PPP projects since the infrastructure thrust was launched in late 2010. These are:
â˘ P2.01-billion Daang Hari-South Luzon Expressway Link Road;
â˘ P15.52-billion Ninoy Aquino International Airport Expressway;
â˘ P16.42-billion first phase of the PPP for School Infrastructure Project (PSIP);
â˘ PSIPâs P3.86-billion second phase;
â˘ P5.69-billion Philippine Orthopedic Center modernization;
â˘ P1.72-billion Automatic Fare Collection System;
â˘ P17.52-billion Mactan-Cebu International Airport Passenger Terminal Building;
â˘ P64.9-billion Light Rail Transit Line 1 Cavite Extension; and
â˘ P2.5-billion Integrated Transport System-Southwest Terminal project
Business World, 23 March 2015
By Claire-Ann Marie C. Feliciano
MANILA, Philippines – Diversified conglomerate San Miguel Corp. (SMC) has earmarked close to P170 billion to bankroll the construction of modern toll roads and highways, to help the government undertake major infrastructure projects nationwide over the next few years.
Ramon S. Ang, president and chief operating officer of SMC, said the conglomerate is investing P168 billion to put the countryâs toll roads at par with those in neighboring countries in Asia.
âWe look at infrastructure as an opportunity to participate in the growth of our country. Quality infrastructure will change and impact lives,â Ang said.
SMC through South Luzon Tollways Corp. (SLTC) is spending P13.1 billion to construct the Southern Luzon Expressway-Toll Road 4 (SLEX-TR4) extending the highway all the way to Lucena in Quezon from Sto. Tomas in Batangas.
The four-lane, 58-kilometer expressway project is seen to make travel to and from Southern Tagalog provinces such as Batangas, Laguna, Quezon, and Bicol, faster and safer. It would cut travel time between Sto. Tomas and Lucena to just one hour from the usual four hours.
âThe tollway will help encourage new investments across these regions. Land values will appreciate; new businesses will emerge. Because of the new roads, progress will be brought to the towns and barangays. And we are happy that we are in a position to contribute,â Ang said.
According to Ang, the project could also help in addressing peace and order concerns by making the provinces more accessible than before.
According to Ang, the proposed tollroad to be completed by 2019 would have four lanes preventing head-on collision, guard rails, median barriers, well-lighted toll plazas, and CCTV cameras, among other safety features.
The project is divided into five sections with Section 1 covering Sto. Tomas, Batangas to Macban Laguna (10.58 kms); Macban, Laguna to San Pablo, Laguna (12.2 kms); San Pablo, Laguna to Tiaong, Quezon (8.1-kms); Tiaong to Candelaria, Quezon (14.4 kms); and Candelaria to Lucena City, Quezon (12.31-kms).
SLTC said that it is targeting mid-2017 for the completion of the first section from Sto. Tomas to Macban. Local government officials have welcomed and expressed support for the project, saying that it would boost trade, commerce, and tourism in Regions 4 and 5.
Aside from SLEX, SMC also operates the Tarlac-Pangasinan-La Union Expressway (TPLEX), the at-grade and elevated Skyway system and the recently upgraded and expanded Southern Tagalog Arterial Road (STAR) Tollway.
SMC has been focusing on tollroad projects including the P15.5 billion Ninoy Aquino International Airport (NAIA) expressway project through Vertex Tollways Development Inc., the P24 billion TPLEX through Philippine Infrastructure Development Corp. (PIDC), and the P26.5 billion Metro Manila Skyway Stage 3 project via Citra Central Expressway Corp. (CCEC).
The Philippine Star, 24 March 2015
By Lawrence Agcaoili