18 October 2012, Rappler.com


President Benigno Aquino III disclosed that of all the infrastructure projects of the government, his priorities are the North Luzon Expressway-South Luzon Expressway (NLEX-SLEX) connector road and all the airport Public-Private Partnerships (PPPs).

In an interview with Rappler, Aquino said these projects would help the government meet its target of an almost threefold increase in tourist arrivals by 2016.

Projects like the connector road will help ease traffic in Metro Manila, while better airports will allow airlines to mount more flights and carry more tourists to the country.

The President said the connector, specifically, will also lead to an efficient transfer of goods between the north and south of Luzon. It will also entice tourists to explore other tourist sites.

Some of the airports that were recently approved by the National Economic and Development Authority (NEDA) board, chaired by the President, are the P4.8 billion-worth Bicol International Airport in Daraga, Albay and the P7.4 billion-worth New Bohol Airport in Panglao, Bohol.

“Without the infrastructure support, the venture into tourist areas won’t happen. So that starts from the airport, then all the roads leading to it and out of it. That’s another major infrastructure project that we want finished,” Aquino said.

Road networks, floods

Aquino said apart from the connector, other road projects are deemed priorities of his administration. One of these is a proposed road that will connect Batangas and Misamis, which could reduce travel time between the two places to 15 hours from a 3-day ferry ride.

He added that other road projects are needed in provinces like Capiz and those in Mindanao. These roads will make it possible to bring agricultural products like shellfish and corn to Luzon at a cheaper and faster way.

The President said he is also keen on completing the country’s flood infrastructure which is estimated to cost around P25 to P35 billion. He said these will take time to complete because they require the creation of watersheds.

“All these infrastructure, anti-flooding, irrigation, etc. enhance that capability to foster that continuous environment necessary for continuous economic growth,” Aquino said.

‘Wrong premise’

The President admitted that the government may have started the PPP initiative on the “wrong premise” when it unveiled 10 ready to go PPP projects in a lavish event that gathered both local and foreign business leaders as early as October 2010.

To date, there have only been two PPP projects that were bidd out. These are the DaangHari – SLEX Link Road and the PPP for School Infrastructure Project (Phase I).

Aquino said the government had to deal with other issues concerning the PPPs. These issues caused many of the delays that plagued the PPP initiative.

He explained that PPPs need to be carefully evaluated since undertaking these projects will require government to “bear certain privileges.” If the government commits a mistake, the project could become more expensive.

“Perhaps we started off with the wrong premise,” Aquino explained. “Gov’t can borrow at concessional rates whereas private sector cannot. That in turn will increase the cost of the infrastructure we need and made no logic just to support the previous statement and to increase the burden of the people.”

Status of PPPs

The PPP Center’s current pipeline includes projects worth $4.8 billion. These projects include 8 transportation projects worth $1.88 billion; 4 road network projects worth $1.29 billion; and 3 water sector projects worth $1.08 billion.

Other projects include two health sector projects worth $126 million; 2 agriculture projects worth $186.9 million; 2 Local Government Unit projects worth $6.28 million; and an education project worth $233 million.

The PPP Center said there were 14 PPP projects approved to obtain financing for pre-feasibility studies under the Project Development and Monitoring Facility (PDMF). These 14 projects were able to obtain funding worth $16 million.

It said it still has $33.5 million left in the PDMF. This includes $7 million from the Philippine government; $6 million from the Australian Government which is administered by the Asian Development Bank (ADB); $9 million additional from the Australian Government, also administered by ADB; and $11.5 million counterpart contribution of the Philippine government. – Rappler.com