Balita, 09 April 2014
CEBU CITY, April 8 â Cebu City Mayor Michael Rama said he wants the immediate implementation of the P17.5-billion Mactan Cebu International Airport expansion project to bring more economic benefits to the country.
Rama issued the statement after the Department of Transportation and Communications (DOTC) finally awarded the project to GMR-Megawide Consortium for submitting the highest bid of P14.4 billion.
This means GMR-Megawide will pay the government up front P14.4 billion, aside from undertaking the P17.5-billion airport expansion project.
âThe whole expansion and the whole infrastructures to be done at the airport will unquestionably and indisputably bring more economic gain to the country,â Rama said.
Rama said the project should be implemented immediately for it to become an engine for economic growth, creating a domino effect for the country.
Rama said there should be no more delay in the implementation of the project because it will hamper the efforts of the Department of Tourism and the Cebu City Tourism Commission in attracting more foreign and domestic tourists.
Louie Ferrer, Megawide chief marketing officer, earlier said they aim to start construction in the early part of 2015, as the terms of reference set that the new terminal should be delivered within 36 months.
Cebu Governor Hilario Davide III, who sits as member of the Mactan Cebu International Airport Authority Board, said he had a sigh of relief after the project was finally awarded to the contractor.
Davide was absent when the bid was awarded during the MCIAA Board meeting Friday in Manila.
He said he was just informed by MCIA General Manager Nigel Paul Villarete about the awarding of the project to the winning bidder. (PNA)
The Philippine Star, 09 April 2014
By Marichu A. Villanueva
For more than three years now, heads of government offices have seemingly adopted âteka-tekaâ mode. This has sort of become the order of the day for those running the various government agencies in the âTuwid na Daanâ of President Benigno âNoyâ Aquino III. Typical of Filipino words that are loosely repeated, âteka-tekaâ means literally âwait, wait.â
The term, however, has taken a pejorative meaning to refer to government policies, programs, and projects that take an interminably long time to get off the ground.
As used, âteka-tekaâ refers to putting things on âwaitâ mode by sending proposals or initiatives on hold for further study or review. This has become the trick employed by government officials who want to play it safe. They simply resort to âteka-tekaâ for any reason because they could not make hard decisions.
Thus âteka-tekaâ has become a national malaise among many Aquino administration officials. In fact, if there is any sign of brewing trouble, they just let P-Noy to take the hit for them.
This national malaise unfortunately afflicted most of the projects under the Public-Private Partnership (PPP) that were initially launched a few months after P-Noyâs inaugural speech in 2010. Supposedly the top priority of the administration, these PPP projects were not spared from the usual problems related to government red tape, legal troubles from right-of-way to bidding wars, etc.
What is not foreseen in P-Noyâs straight path are the obstacles or roadblocks thrown along the way. What do you do when a losing bidder, or should we say sore loser â some backed by their politician-friends â questions the implementation of approved PPP projects?
President Aquino ticked off a number PPP projects, most of which involved major infrastructure. The bulk of the projects were under the Department of Transportation and Communications (DOTC); the Department of Public Works and Highways (DPWH), and the Department of Education (DepEd).
We had thought that the newly appointed economic managers then would hit the ground running and take firm and decisive steps to fast-track these various infrastructure projects, including roads, airports and railways.
Up to now, or more than halfway through P-Noyâs term, however, we can count on the fingers of one hand the number of PPP projects that have actually laid the cornerstone, or poured the first concrete on the foundation.
The government has already awarded some of these priority infrastructure projects to the biggest names in business such as the Ayalas and Metro Pacific led by Manny V. Pangilinan. But for one reason or another, many other PPPÂ projects are suffering endless delays.
A case in point is the Mactan-Cebu International Airport (MCIA) project. The P17.8-billion project was awarded by the DOTC to the winning bidder, GMR-Megawide, only last Friday. This is more than three months after the Filipino-Indian consortium won the open competitive international bidding for this project held in December last year.
After the usual post-bidding review, the DOTC should have already issued the notice to Megawide-GMR to proceed with implementation. By this time, if the award had been made in December, GMR-Megawideâs bulldozers and other heavy equipment would have begun work on the project already.
Weâre not saying that every proposed project should be immediately approved without due diligence on firms bidding for government contracts. Every bidder should satisfy all the requirements for a particular project. This is what âTuwid na Daanâ is all about.
GMR-Megawide submitted the highest bid of P14.4 billion. The winning consortium beat six other bidders which are also big-time Filipino conglomerates with their respective foreign partners. Megawide is one of the top construction firms in the Philippines while Bangalore-based GMR Infrastructure Ltd. is the worldâs third largest private airport developer in terms of passenger traffic.
Immediately after winning their bid, Megawide-GMR underwent a barrage of allegations that it should be disqualified because of reported lack of financial capability, poor track record, conflict of interest, among others.
Such serious allegations naturally raised valid concerns, especially from leaders of Cebu like Sen. Sergio OsmeĂąa III. Acting on the Resolution filed by OsmeĂąa, the Senate committee on public services conducted at least two public hearings that looked into these allegations. Top officials and executives of the DOTC and GMA-Megawide were invited to shed light on the issues.
At the Senate hearings, both Megawide and GMR rebutted all the allegations. Apparently, they finally managed to convince also the DOTC that they were right to award the MCIA project to their consortium. But they were unable to win over Sen. OsmeĂąa.
On the eve before the DOTC issued the notice to proceed last Friday night, OsmeĂąa filed before the Supreme Court a petition seeking TRO to stop the DOTC from awarding the MCIA to the winning bidders. While it may have been filed too late to stop the DOTC notice, the winning bidders are not yet out of their troubles.
Despite such troubles, Megawide remains actively involved in PPP projects. In fact, they bagged three other PPP projects, namely, the P5.7-billion new Philippine Orthopedic Center; the PPP School Infrastructure Project Phase One (PSIP-1), the PSIP-2.
The MCIA project is the biggest yet that Megawide will undertake â and the most troubled one as it turned out. Its partner GMR is likewise undeterred by these challenges. GMR is reportedly bidding in six other PPP airport projects.
Many administration projects now being implemented are in catch up mode precisely due to so much delays the investors and private contractors encounter in doing business with the government.
We could only hope and wish these private local and foreign contractors would not resort to cutting corners just to fit the timetable of completion within the remaining 812 days in office of P-Noy.
Business Standard, 09 April 2014
ByÂ Surajeet Das Gupta & Aneesh Phadnis
The company faces a petition in Philippine’s Supreme Court to scrap the deal
A consortium led by the Bangalore-basedÂ GMRÂ group, which won the bid for theÂ Mactan CebuÂ internationalÂ airport projectin theÂ Philippines, faces a petition in that country’sÂ Supreme CourtÂ to scrap the deal.
Serge R OsmeĂąa III, a prominent Philippine politician, said in his petition filed in court two days before last week’s announcement that the GMR group violated bid conditions that barred companies with a conflict of interest from bidding. He has asked the court to stop the notice of award to GMR and its local consortium partner, Megawide.
The consortium bid $325 million to renovate, modernise and expand the Mactan Cebu airport and operate it for 25 years. It outbid seven global competitors, many of which had earlier raised questions about GMR.
The conflict of interest arises because Malaysia Airport Holdings Berhad, which separately bid for the Mactan Cebu project, is also a stakeholder in GMR’s airports in Delhi and Hyderabad. Tan Bashir Ahmad, apart from being managing director of Malaysia Airport Holdings, is also on the boards of directors of the two GMR airport companies.
The petition said the other bidders were at a disadvantage because they were restricted from entering into similar arrangements. It also said the Senate Committee of Public Services had conducted two hearings on the issue and had concluded that the pre-qualification bids and awards committee did not compare the submissions of the bidders in order to determine the existence of a conflict of interest.
OsmeĂąa’s office said the senator would not comment on the issue, as he had already filed a petition in court. A GMR spokesperson said there was no conflict of interest at all. “The company that bid for the airport was GMR Infrastructure, in which Malaysia Airport Holdings has no stake or director representation. The government gave us the contract only after looking into this issue, after we became the highest bidder in December,” he said.
The Philippine airport is crucial for GMR that has loaded itself with debt to fund its foreign expansion. The company was forced to exit the $500-million Male airport after a change of government in the island nation in November 2012. Malaysia Airport Holdings last December bought GMR’s 40 per cent stake in an airport in Istanbul. GMR was also interested in the Barcelona and Madrid airports, but their auctions were cancelled.
The group had bid the highest for the Mactan Cebu project last December. But the award was held up by objections from rival bidders. A consortium of Filinvest-CAI, which came a close second, raised the issue of conflict of interest. The Philippine government finally selected GMR-Megawide last Saturday after scrutinising all the claims and counter-claims.
INS & OUTS
The Philippine Star, 08 April 2014
By Louella Desiderio
MANILA, Philippines – The government plans to rollout 15 projects under the Public Private Partnership (PPP) program with a total cost ofÂ over $14 billion, from now until the first quarter of next year.
âThe 15 projects are what we think we can rollout in the next 12 months,â PPP Center executive director Cosette Canilao told reporters on the sidelines of the Philippines-France Conference held yesterday.
She revealed that the government intends to issue the request for qualifications or the start of bidding processÂ for the Bulacan Bulk Water Supply Project ($542.22 million) and the Integrated Transport System Southwest Terminal ($115.56 million) by May.
The government likewise wants to start the bidding for six airport projects by June. These are the Laguindingan Airport operation and maintenance (O&M) ($354 million), New Bohol (Panglao) Airport O&M ($52 million), Puerto Princesa Airport O&M ($71.13 million),Davao Airport O&M ($476.39 million), Bacolod Airport O&M ($208.98 million), and Iloilo Airport O&M ($322.34 million).
The issuance of request for qualification for the Laguna Lakeshore Expressway Dike project, with a cost of $1.44 billion, is slated for either June or July.
The Motor Vehicle Inspection project ($313.16 million) would be rolled out by the third quarter, while the bidding for the Mass Transit System Loop ($3 billion) would begin in the fourth quarter.
For the North South Commuter Rail, which would start from Malolos in Bulacan to Calamba in Laguna ($6.03 billion), the government hopes to hold the bidding process by the first quarter next year.
Canilao said the government may even advance the start of the bidding by the fourth quarter of this year.
Other projects to be rolled out over the next 12 months are: the O&M and extension of the Light Rail Transit Line 2 which runs from Recto station in Manila to Santolan station inMarikina, the New Centennial Water Supply Source Project ($417.33 million), and the New Prison Facility ($895 million).
âIn the next 12 months, we are really working hard, barring causes of delay in seeking approvals, then weâre hoping that we could rollout all those projects in the next 12 months,â Canilao said.
âThe reason why we are putting word in the market that we will rollout these projects is so that investors can already founnd consortium and prepare for it,â she added.
The government has so far awarded seven PPP projects which are the Daang Hari â South Luzon Expressway Link Road; the PPP for School Infrastructure Project (Phase I), NAIA (Ninoy Aquino International Airport) Expressway Project, PPP for School Infrastructure Project (Phase II); Modernization of the Philippine Orthopedic Center, Automatic Fare Collection System, and the Mactan-Cebu International Airport Passenger Terminal Building.
Asia News Network, 08 April 2014
By Amy R. Remo
Manila (Philippine Daily Inquirer/ANN) -Â The Philippine government plans to roll out 15 projects worth a total of $14 billion under the Public Private PartnershipÂ (PPP) program over the next 12 months, PPP Center executive director Cosette Canilao said Monday.
âWe are really working hardâbarring any event that will can cause delaying seeking approvalsâto roll out these projects in the next 12 months, which means we willÂ publish the invitation for qualification requests,â Canilao said on the sidelines of the Philippines-France conference held Monday.
âWe are putting putting word out on the market that weâre rolling out these projects in the next 12 months so that investors could already group or find consortiumÂ members, and by showing them the estimated project costs, they know they will have to make [a reasonable] offer,â she explained.
Canilao made a presentation of the PPP projects before local businessmen and a French investment delegation led by Medef International. The bidding process for theÂ projects, which are in varying stages, might start as early as next month up to the first quarter of 2015, she added.
Canilao identified the 15 projects as the $542.22-million Bulacan bulk water supply project; the $417.33 million New Centennial Water Supply source project; theÂ operation and maintenance of the LRT Line 2; the $6.03-billion Integrated Luzon Railway Project Phase 1; the $3-billion Mass Transit System Loop; the $353.78-millionÂ operation and maintenance contract for the Laguindingan Airport, and a $52-million operation and maintenance contract for the New Bohol (Panglao) airport.
Also included in the list were the $71.13-million operation and maintenance contract for the Puerto Princesa airport; the $476.39 million operation and maintenanceÂ contract for the Davao airport; the $208.98-million operation and maintenance contract for the Bacolod airport; the $322.34-million operation and maintenance contractÂ for the Iloilo airport; the $895.33 million regional prison facilities in Fort Magsaysay in Nueva Ecija; the $115.56-million Integrated Transport System ProjectÂ Southwest Terminal; the $313.16-million Motor Vehicle Inspection System, and the $1.44-billion Laguna Lakeshore Expressway Dike project.
The Bulacan Bulk Water Supply project, which will be implemented in three phases, will supply treated water to 24 municipalities of Bulacan, while the New CentennialÂ Water Supply Source Project aims to increase Metro Manilaâs raw water supply with the construction of the Kaliwa Dam and the Water Conveyance Tunnel.
The integrated Luzon railway project aims to revitalize the entire length of the state-run Philippine National Railway (PNR), while the Mass Transit Loop will connectÂ the fast-developing Bonifacio Global City, Makati Central Business District and the Mall of Asia area in Pasay City.
Contracts for the airports (Laguindingan, Bohol, Puerto Princesa, Davao, Bacolod and Iloilo) will give to the private sector the operation, maintenance and commercialÂ management of the facilities, including future investments for capacity expansion.
The regional prison facilities project will entail the construction and maintenance of a state-of-the-art prison facility in Fort Magsaysay, Nueva Ecija; while theÂ Integrated Transport System Project Southwest Terminal aims to provide a central transport terminal where all modes of transport will be available in one location.
TheÂ Motor Vehicle Inspection System is intended to be the national network of Motor Vehicle Inspection Centers (MVICs) using automated inspection methods that will beÂ linked to the information system of the Land Transportation Office, while the Laguna Lakeshore Expressway Dike will provide a high standard highway-cum-dike with aÂ proposed alignment that runs 500 meters away but following the shoreline of the Laguna Lake.
The Philippine Star, 08 April 2014
By Louella Desiderio
MANILA, Philippines – French companies are interested in business opportunities in the country.
Trade undersecretary Ponciano Manalo, Jr. told reporters on the sidelines of the Philippines-France Conference yesterday the French business delegation, composed of more than 20 companies from Franceâs biggest business organization MEDEF International, is looking at available opportunities here.
âTheyâre interested in PPP (Public Private Partnership) projects, aerospace, energy…and in opportunities in Mindanao,â he said.
âWeâre very happy the French delegation is here and they can have a view on the Philippines,â he said further.
MEDEFâs business delegation is a return visit to the country following the trade and investment mission conducted by the Department of Trade and Industry in France in September last year.
Manalo said the DTI is planning to visit France again sometime this year in line with its aim of increasing trade and investment ties with European countries.
MEDEF International Business Delegation president Philippe Matiere told reporters there has always been strong interest from French companies to do business in the Philippines.
âThis is because of the continuous growth of the economy and success of French companies in the Philippines,â he said.
He added that the Philippine government has facilitated an environment more conducive for business.
French economic counsellor Gilles Vernet said it is in the interest of France to strengthen its economic relations with the Philippines.
âWe support the EU GSP+ (European Union Generalized Scheme of Preferences Plus) status leading to a free trade agreement with the EU,â he said, noting that being a beneficiary of the trade scheme would allow the Philippines to increase trade with France.
The EU GSP+ covers 6,274 products that could enter the EU at zero duty.
Currently, the Philippines is a beneficiary of the regular GSP which covers 6,209 products, with 2,442 products subject to zero duty and the rest slapped with lower tariffs.
Two-way trade between France and the Philippines is valued at two billion euros.
For his part, French Ambassador Gilles Garachon said he would encourage more French tourists to visit the country.
Manila Standard Today, 08 April 2014
ByÂ Othel V. Campos
Stronger bilateral ties and the prospect of increased investments between the European Union and the Philippines may lead to the lifting of the flight ban on Cebu Pacific Air soon.
A French business delegation led by members of the Mouvement des enterprises de France said France was one of the countries that favored the lifting of the ban soon.
âWeâre just one of the countries of the EU. The decision still has to be taken officially as a regional bloc. It hasnât been decided yet and hopefully it will go in the right direction,â head of delegation and Matiere SAS chief executive Philippe Matiere told reporters Monday during the Philippines-France Conference at the Hotel Intercontinental Manila in Makati City.
Trade Undersecretary Ponciano Manalo, meanwhile, said the French trade mission was interested in forging joint ventures with local companies to bid for private public partnership projects.
âThe interest is very high especially on transport and aeropace. There are also interests in energy, oil and gas exploration and investments in Mindanao,â he said.
The 23-company delegation includes ADP Ingenierie, Airbus Group International, Alstom, Bureau Veritas, Citelum, Cofely Group, Collecte Localisation Satellites, Credit Agricole Corporate and Investment Bank, Egis S.A. and Freyssinet International Manila Inc.
Matiere said the lifting of the ban on Cebu Pacific would benefit French tourists who were having difficulty booking flights to the Philippines.
The Medef is the biggest union of employers in France, with over 750,000 member companies. It serves as a lobby group at the local, regional, national and EU-wide levels.
About 40,000 French tourists visit the Philippines yearly. Matiere said a liberal flights arrangement was a promising prospect and that infrastructure was key to tourism development.
French Ambassador to the Philippines Gilles Garachon said he was looking forward to the lifting of the ban on Cebu Pacific.
Business World, 08 April 2014
ByÂ Daryll Edisonn D. Saclag
âThey are very much interested to invest in the Philippines. Some of them are already here. Some are in the process of opening while some are planning to do so. They are convinced that they must have presence in the Philippines,â French Ambassador Gilles Garachon told reporters yesterday, at a business forum jointly organized by the Philippines-France Business Council, MEDEF International, the National Committee of Foreign Trade Advisors of France, and the French Embassy in Manila.
Twenty-four French companies — which are into energy, transportation, banking, aerospace development, shipbuilding, and infrastructure — were in town yesterday for networking and business matching activities.
The visiting firms are members of the Mouvement des entreprises de France (MEDEF), or the Movement of the Enterprises of France.
MEDEF, according to its Web site, was established in 1946 and started out as the Conseil national du patronat FranĂ§ais. It changed to its current name in 1989 and now represents more than 700,000 businesses in France.
Philippe MatiĂ¨re, head of the business delegation and chief executive officer of construction firm MatiĂ¨re SAS, said: âSeveral things happened that make it [the Philippines] even more interesting for French companies. First is the continuous growth and stability of the country, and second was the success met by a lot of French companies here last year.â
The French Embassyâs Mr. Garachon said many French companies joined the delegation to find out which sectors they can invest in and how to do business in the Philippines.
He said tourism has the highest potential for growth between the two countries as travel to the Philippines from France and vice versa has been limited due to a ban on local carriers by the European Union (EU).
âThere are not enough French tourists visiting the Philippines [due to] an air ban by the European Union. The air safety committee has lifted the ban for PAL (Philippine Airlines), and it is now in the process of lifting the one for Cebu Pacific. It has not been decided yet, but the prospect is good. We hope it will be lifted this year,â said Mr. Garachon.
In 2010, the EU blacklisted local carriers after the International Civil Aviation Organization (ICAO) in 2009 tagged the Philippines as a âsignificant safety concern.â
But, reforms implemented since then led the ICAO to remove the Philippines from the list of countries with safety concerns in March last year.
Last July, the EU had lifted the ban imposed on PAL, allowing the flag carrier to mount flights to the 28-member bloc.
Should Cebu Pacific hurdle EU scrutiny, the budget carrier is expected to compete with PAL, which resumed operations to Europe last November, launching flights five times a week to London.
Gilles Vernet, economic counselor at the French Embassy, said he expects Philippine exports of agricultural products and electronics to France to increase upon the approval of Manilaâs application for Generalized Scheme of Preference Plus (GSP+).
The GSP is a trade arrangement where the EU grants lower tariffs and zero duties to developing countries to boost their export capabilities. Under the arrangement, the Philippines enjoys tariff reductions on 3,767 products and zero duty on 2,442.
The GSP+, on the other hand, would grant zero duty to all products exported to the EU.
The Philippines submitted its application last December and expects to enjoy GSP+ benefits by the middle of this year.
Trade Undersecretary Ponciano C. Manalo, Jr., meanwhile, said that during his discussions with several French companies, âmany were interested in participating in PPP (public-private partnership) projects, aerospace development, energy, and oil and gas.â
He added that he has received inquiries on how to invest in Mindanao, especially now that the government and the Moro Islamic Liberation Front have signed the Comprehensive Agreement on the Bangsamoro.
PPP Center Executive Director Cosette V. Canilao, for her part, identified 15 projects the agency expects to roll out within the next 12 months, which French companies may take part in:
â˘ the $542.22-million Bulacan Bulk Water Supply Project;
â˘ the $417.33-million New Centennial Water Supply Project;
â˘ the operation and maintenance (O&M) of the existing 13.8-kilometer Light Rail Transit Line 2;
â˘ the $6.03-billion Integrated Luzon Railway-Phase 1 Project;
â˘ the $3-billion Mass Transit System Loop project connecting Bonifacio Global City, Makati Central Business District, and the SM Mall of Asia in Pasay City;
â˘ the $353.78-million O&M project for the Laguindingan Airport;
â˘ the $52-million O&M project for the New Bohol (Panglao) Airport;
â˘ the $71.13-million O&M project for the Puerto Princesa Airport;
â˘ the $476.39-million O&M project for the Davao Airport;
â˘ the $208.98-million O&M project for the Bacolod Airport;
â˘ the $422.34-million O&M project for the Iloilo Airport;
â˘ the $895.33-million prison facility in Nueva Ecija;
â˘ the $115.56-million Integrated Transport System Project — South Terminal;
â˘ the $313.16-million Motor Vehicle Inspection System; and
â˘ the $1.44-billion Laguna Lakeshore Expressway Dike Project.
Mr. Garachon said a Philippine business delegation, including President Benigno S.C. Aquino III, is expected to visit France in September.
âIt will be a landmark visit and will be a perfect time to reinforce this positive momentum,â said Mr. Garachon.
Some of the French companies and brands that are already in the Philippines include gasoline station Total, construction materials provider Lafarge, cosmetic brands LâOreal and Maybelline, apparel brand Lacoste, and business process management firm Teleperformance.
Total trade between France and the Philippines last year reached $1.935 billion, with imports from France amounting to $1.622 billion while Philippine exports were only $312 million.
Business Mirror, 07 April 2014
By Catherine N. Pillas
A visiting 24-member French business delegation has expressed growing interest in investing in the Philippines, specifically in aerospace, energy and public-private partnership (PPP) projects, according to Undersecretary for Trade and Investment Promotions Ponciano Manalo Jr.
On the part of the French delegation, they are looking at the Philippines with a fresh set of eyes due to the Philippinesâs general upward growth and ease of government dealings on projects, among other factors, he said.
âWe are making a big pitch to the French business community and they really want to learn about us. We have a lot of leads especially in aerospace, energy, specifically in oil and gas,â Manalo said in an interview with reporters on Monday.
The MEDEF International delegation, which was received by major proponents of the government, represents the French Business Confederation and its 800,000 companies, worldwide.
Major government agencies, including the Philippine Economic Zone Authority, departments of Tourism, of Transportation and Communications, and Trade and Industry, PPP Center, Department of Finance, as well as private-sector business groups welcomed the European business delegation and presented the countryâs strengths during the Philippines-France Conference on Monday.
Gilles Vernet, French Embassy economic counselor, confirmed prospects in industry, primarily in infrastructure, aviation, energy, manufacturing and transportation from the business delegation âThis high-level French business delegation already has contracts here in the Philippines or is in the process of setting up offices,â added French Ambassador to the Philippines Gilles Garachon in an interview with reporters.
âThere has always been interest from French companies, but several things make the Philippines more attractive: the continuous economic growth and stability of the government now, the successes of existing French companies in the Philippines and now itâs easier toÂ Â deal with the government,â MEDEF International Head Philippe Matiere said in the same interview with reporters.
Vernet confirmed that existing substantial French investments today come from La Farge, a global giant in cement manufacturing, LâOreal, AXA Life Insurance and Total Gas.
âWe hope to see a doubling up of French presence and investments in the coming years,â Vernet added.
Bilateral trade between the Philippines and France, which stands at âŹ2 billion, is currently in the favor of the European country, said Vernet, due to the contracts with Airbus for the purchase of planes but will soon level out after the refleeting.
Franceâs exports to the Philippines are at âŹ1.5 billion, mostly in aviation,Â Â and imports are at âŹ0.5 billion, but could have a rebalancing of trade if the Philippines ramps up its exports, especially in agriculture and the furniture industry.
(With Bloomberg News)
Global Construction Review, 07 April 2014
After months of wrangling, the Philippinesâs Department of Transport and Communications (DOTC) has finally awarded the concession to renovate, expand and then to operate the Mactan-Cebu International Airport to a consortium comprising an Indian firm and a Philippine firm.
It emerged in January that Indiaâs GMR Infrastructure and the Philippinesâ Megawide Construction had offered the highest premium, approximately $320m, for the project, which entails renovating the existing passenger terminal building, building a new one for international flights, and operating the airport for 25 years.
The award process for this public-private partnership (PPP) has been controversial.
The second highest bidder, a consortium of the Phillipinesâ Filinvest Development Corporation and Singaporeâs Changi Airport Group, sought the disqualification of GMR-Megawide on grounds of conflict of interest and insufficient capacity to handle the project.
Then, just a day before the contract award, a senior politician, Senator Sergio OsmeĂąa III, asked the Philippinesâ Supreme Court to stop it. He, too, alleged conflict of interest on GMRâs part.
But the DOTC remained committed to the GMR-Megawide bid.
âAmidst all the noise drummed up in different forums the past few months, the DOTC has allowed nothing but the law and the countryâs interests to matter in awarding the project,â said DOTC spokesperson Michael Arthur Sagcal in a statement.
âThis project should have been done at least a decade ago, so there is no more time to waste,â he added. âWe have resolved all issues, we are ready to defend our decision, and it is now time to push forward onDaang MatuwidÂ by delivering our services to the people.â
(Daang Matuwid, meaning âstraight pathâ, is the name given to the anti-corruption initiative launched by Philippinesâ president Benigno Aquino.)
GMR-Megawide now have 20 days to complete the post-award requirements, such as submitting a $4m line of credit up front, and the payment of the $320m premium to the Philippines government.
The DOTC said the construction work is expected to take three to four years. The total cost of the renovation and expansion has been estimated in the Philippinesâ media to be 17.5bn pesos, or roughly $390m.