Posts Tagged ‘Cosette Canilao’

Cebuanos Express Support for the Cebu Airport PPP Project

Press Release
03 June 2014

Representatives from 13 private and government organizations expressed support for the P17.5 Billion Mactan-Cebu International Airport new passenger terminal building project to be implemented under a public-private partnership (PPP) arrangement.

These stakeholders sealed their commitment of support during the project’s ceremonial signing last 30 May 2014 at the Waterfront Hotel & Casino in Mactan, Cebu. The signing was led by the project’s private proponent GMR-Megawide Airport Corporation (GMCA) together with the Department of Transportation and Communications (DOTC) and Mactan-Cebu International Airport Authority (MCIAA).

PPP Center Executive Director Cosette V. Canilao, in her speech during the signing, expressed that the MCIA project’s success “sends a very clear signal to our investors that if you do business in the Philippines, you are certain to get a fair and square deal.”

Aside from the PPP Center, other government agencies present to support to project were the Cebu Provincial Government, Lapu-Lapu City Government, Department of Finance, Department of Tourism, Bureau of Customs, and Bureau of Immigration. Cebu-based private organizations that included the Cebu Chamber of Commerce and Industry, the Mactan Airline Operators’ Association, and the Hotel and Restaurant Association of Cebu were also present to express support to the project.

GMCA, the company created by the winning consortium to undertake the project under the PPP Agreement, vowed to transform the existing Mactan-Cebu International Airport (MCIA) facility into the world’s first ‘Resort-Airport’ and make it the second largest gateway to the Philippines by 2017. GMCA will take over the MCIA by October 2014 and start on the airport’s proposed upgrades.

World’s First Resort-Airport

The new airport will have separate international and domestic terminals linked by a bridge to facilitate ease of movement for connecting flights. Adequate parking facilities and aircraft parking stands served by bus transfers will be in place.
The upgraded airport will have more spacious check-in area with additional counters and enhanced automated baggage handling systems and will feature conveniently located airlines lounges, retail and food shops. It will have an adjoining “village mall” complex.

The company is currently talking to world-renowned Cebu designer Kenneth Cobonpue for the airport’s interiors.

International and Cebuano designers are working together on this expansion because we want the new airport to reflect the rich Cebuano heritage while it exudes a modern yet soothing resort feel,” said GMCA President Louie Ferrer.

By 2017 when the project is completed, we would like the Mactan-Cebu International Airport to be something that Cebuanos can call their own and which all Filipinos can be truly proud of,” added Ferrer.

7th PPP Project Awarded

The MCIA project of the DOTC is the seventh project to be awarded under the flagship PPP program of the Aquino Administration. It is also the country’s first airport PPP project awarded.

GMR-Megawide Consortium was awarded the MCIA project last April 4 after submitting the best bid offering the highest premium of P14.404 billion to government in December 2013. After fulfilling all the post-award requirements including the turnover of the upfront payment, DOTC and GMR-Megawide officially signed the airport’s 25-year concession agreement in April 22.

The MCIA project is set to modernize the current airport in Cebu with the construction of an international passenger terminal building at the same time expanding the existing passenger terminal. The modernization of the MCIA will address the growing influx of passengers.



Other regions have to wait as govt moves funds to rebuild E. Visayas

GMA News, 29 November 2013

The Philippines was already playing catch-up with neighboring countries in infrastructure. Super typhoon Yolanda has pushed back plans to improve and add roads, bridges and schools in other parts of the country, as authorities devote government resources to rebuilding flattened towns and cities.

“They (the government) have to recast some plans. Some efforts are kicking in but any rebuilding in the coming months will be incremental in nature,” Emilio Neri Jr., lead economist at the Bank of the Philippine Islands, said in a telephone interview on Friday.
Neri said a significant infrastructure boost in Yolanda-stricken areas is only “seen to start second quarter.”
In a separate telephone interview Friday, Metropolitan Bank & Trust Co. research head Ildemarc Bautista said: “Most efforts are focused on relief. The private sector and the government are still evaluating what needs to be done.”

Healthy fiscal space and an accommodating financing environment allow elbow room to fund reconstruction.

Counting the costs
Some P38.8 billion in government funds have been “approved in principle” by President Benigno Aquino III to bankroll “critical and immediate interventions” that include housing assistance and repair of classrooms, public markets and hospitals, Socioeconomic Planning Secretary Arsenio Balisacan said in a press briefing Thursday.
Cabinet secretaries have been huddled in meetings to firm up a longer three- to four-year rehabilitation plan that could include tedious mapping of affected areas and even the relocation of infrastructure.
“Agencies continue to conduct damage and loss assessments, gathering more detailed information and validating available data, in cooperation with local government units and development partners working on the ground,” the National Economic and Development Authority said in a statement Thursday.
As of Friday morning, the National Disaster Risk Reduction and Management Council estimated damage to infrastructure, mostly transport networks and schools, at P12.283 billion. The price tag is only expected to go up as more reports come in.
The state can fund immediate rebuilding, said Balisacan, but cautioned: “What we need, perhaps, are resources for the medium-term interventions that will require facilities.”
While a liquid financial system, below-cap budget deficit, and soft loans and realignments from development partners could ease financing for rehabilitation of Yolanda-stricken areas, these only serve to “take away from funds that could be used for new infrastructure,” said Neri.
The Aquino administration wants to hit the 5-percent ratio between infrastructure spending and the country’s gross domestic product by the time its term ends in 2016 to address an infrastructure lack, which the World Economic Forum says is the country’s top problem in attracting investors.
This is on top of infrastructure projects under the Aquino administration’s public-private partnership (PPP) program.
PPPs post-Yolanda 
In an interview Thursday night, PPP Center executive director Cosette Canilao said the agency has been meeting with economic managers and private sector participants on how the flagship infrastructure program can expedite the rebuilding.
“From the PPP side, tinitignan namin kung papaano makakatulong yung private sector ma-accelerate yung reconstruction, especially the schools,” she noted.
Of the roster PPPs, the second phase of the nationwide classroom building project meant to address a classroom shortage took the brunt from Yolanda.
“Talagang magbabago yung specifics. For example, yung location. May mga areas na hindi na pwedeng tayuan. Tapos, imbis na how many classrooms lang ang i-coconstruct… Yung iba, buong school na ang kailangan,” Canilao said.
Some proposed PPP projects have to reviewed, but those in advanced stages and others that were bid out are still seen to hurtle forward as these are mostly in Metro Manila and the Northern Philippines.
Balisacan said: “We really need the private sector to come in quickly.”
Build better, lasting infrastructure
For all the pain and destruction it has caused, Typhoon Yolanda has at least served to open the gate for improved infrastructure in a region left behind.
“It may be an opportunity for the government to significantly upgrade infrastructure, to come out with grander plans and better outlays,” said Neri.
Balicasan said the unified post-Yolanda recovery and rehabilitation plan, which is a work in progress, includes building infrastructure that “are structurally sound.
“It’s a full range of activities from early recovery and reconstruction toward better, resilient communities,” he noted. — JDS/HS, GMA News

5 infra works to be completed by 2016

Inquirer, 27 October 2013

PPP Center exec says other projects in the pipeline to go full blast

At least five major infrastructure projects will be completed under the public-private partnership (PPP) framework and several others likely to be in full blast of construction before President Aquino steps down from office in 2016, the chief of the government’s PPP Center said.

Speaking during the 8th Philippine Forum organized by The Asset Magazine and the Fund Managers Association of the Philippines (FMAP) last week, PPP Center executive director Cosette Canilao said the five projects likely to be completed during this administration were Daang Hari tollroad, School Infrastructure project phases one and two, the modernization of the Philippine Orthopedic Center and the Naia Expressway.

Speaking to reporters after the forum, Canilao said it’s also possible to complete the integrated transport fare collection system within Mr. Aquino’s term. “Once this project is approved and rolled out, it’s possible that this will be completed. It’s not too complicated,” she said.

For his part, Transportation Undersecretary Rene Limcaoco said most of the infrastructure projects under his department’s pipeline would likely take off, not just those to be bid out under the PPP framework but likewise those that would be undertaken by the government itself.

Canilao said the following projects would be at the height of construction within Mr. Aquino’s term: Light Railway Transit Line 1 extension, Mactan-Cebu International airport upgrading.

By year 2015, she said most of the big-ticket projects would be in full blast of construction while 2014 would, for some, be the year to raise funds.

Canilao is expecting the rollout of the PPP projects to be faster in these last three years of the Aquino administration, noting that “lessons” had been learned from the first half of the President’s term.

“We’ve done already the setting down of the processes. We’re still improving it but the foundation is already there. During the remainder of the term, hopefully it will be faster. We’re looking at standardizing some of the bid documents so that the bidders, once they receive the drafts, they know what to expect,” Canilao said.

During the forum, when asked by The Asset editor-in-chief Daniel Yu to assess the performance of the government’s PPP program in the first three years, Canilao gave a score of six out of the highest possible score of 10. On rating his department’s infrastructure program, Limcaoco gave a rating of five out of 10.

Canilao said the government was likewise working to amend the build-operate-transfer law to boost the PPP program for the longer haul, no longer for the current pipeline.

“We don’t need it (for this term) but nonetheless, we’re rushing it, hoping that it will be passed by summer recess,” Canilao said.

She said among the most important provisions would be to identify and set parameters for projects of “national significance” as well as to extend the mechanism for Swiss challenge, or the process of inviting counter-proposals to unsolicited projects.

Right now, rival bidders are given 60 days to make a counter offer. “We’re hoping for at least six months,” she said.

At the same time, the amendments call for the creation of a PPP governing board and a legal framework for a PPP Center.

Flexibility is likewise sought on the contingent liability that the government can take in relation to projects in the pipeline, she said.


Classrooms under first DepEd PPP ready by April 2014

GMA News, 25 October 2013

Construction of 9,300 classrooms under the first phase of a public-private partnership (PPP) project of the Department of Education (DepEd) is likely to be completed by April next year, the top official of the state agency reviewing the flagship infrastructure program said Friday.

“That’s the target and contractors are expected to deliver,” Cosette Canilao, executive director of the PPP Center, said in an ambush interview in Bulacan province.,

The PPP for School Infrastructure Project (PSIP) Phase 1 involves the design, construction, maintenance, and financing of 9,300 classrooms in one and two-story buildings in Regions I, III and IV-A.

The 10-year contract under a build-lease-and transfer agreement also includes furniture, fixtures and toilets for 2,204 public elementary and secondary school.

The construction contract was bagged last year by two consortia: BF Corporation-Riverbanks Development Corporation, and Citicore Holdings Investment Inc.-Megawide Construction Corporation.

In a separate interview, Louie Ferrer, Megawide vice-president for Marketing and chief information officer, said some of the constructed classrooms were already being used by recipient-pupils.

On Friday, Megawide turned over 500 newly-built classrooms in Region 3 and 4-A to Education Secretary Armin Luistro.

“With the help of the private sector we are confident that we can deliver our commitment to public school students,” Luistro said.

According to the status report posted on the PPP website, construction of 3,200 classrooms has started, while notices to proceed for some 5,400 classrooms have been issued.

The PSIP was fielded in the PPP program two years ago to cut the public school system’s 66,800-classroom shortage as fast as possible.

Phase II of the PSIP – which aims to construct 10,679 more classrooms – was bagged by Megawide and Consortium of BSP & Co. Inc and Vicente T. Lao Construction this October. — DVM, GMA News

Aquino gov’t to bow out with five PPPs done

Business World, 24 October 2013

JUST FIVE public-private partnership (PPP) projects are expected to be completed by the end of Aquino administration’s term, an official yesterday said, but the infrastructure program will continue after 2016 given the groundwork that is being laid.

“We will finish Daang Hari. We will finish the two school projects. We will finish the hospital. We will finish the Ninoy Aquino International Airport (NAIA) expressway … So we have five projects that will be finished in the remaining term of President [Benigno S. C.] Aquino [III],” PPP Center Executive Director Cosette V. Canilao yesterday told a capital markets forum.

“[The year] 2015 will be the height of construction for the projects that will be rolled out in the next few months, and what’s more important to us is to leave a very successful program to the next administration…,” Ms. Canilao added.

Just four PPP projects have been awarded by the Aquino administration since it rolled out its centerpiece infrastructure program in late 2010. The P1.96-billion Daang Hari-South Luzon expressway project was the first, going to Ayala Corp. in 2011. The second, the P16.42-billion first phase of the PPP School Infrastructure Program (PSIP), was granted to two consortiums last year, while the P15.68-billion NAIA expressway and phase two of the PSIP were awarded this year.

The government is still reviewing the sole bid submitted for the P5.70-billion Philippine Orthopedic Center project.

Ronald L. Arambulo, executive director of the Information Technology and Business Process Association of the Philippines, said continuity was important to ensure the PPP program’s success.

“When … you leave, you have to make sure that the next batch won’t start from zero again,” Mr. Arambulo said.

Transportation Undersecretary Rene K. Limcaoco admitted that the government “could have gone faster” in the implementation of some projects, but said the process involved a “learning curve.”

“We were starting off from scratch. When we came in, we had an empty cupboard and we basically had to start everything from scratch,” he said.

But Ms. Canilao said: “We’re done already with setting the framework and the processes, although we’re still improving it … We already have a lot of learnings from the private sector and the government so for the remaining term, hopefully, it will be faster.”

The Aquino government has come under fire over the delays that have hit the PPP program. It has claimed that extensive reviews were needed to make projects foolproof, although recently prospective investors have complained of onerous contract terms.


PHL fights to save PPP initiative before PNoy goes in 2016

GMA News, 22 October 2013

After the Aquino administration failed to bid out a rail rehabilitation job—the most expensive infrastructure project in the pipeline at P59.2-billion—the government is scrambling to correct the doubts cast over its flagship public-private partnership (PPP) program.

Officials now acknowledge the need to shift to high gear by inserting changes in the rules and regulations concerning contracts, while the private sector waits the next invitation to bid on the Light Rail Transit Line 1 Rehabilitation project.

“We have to do some structural changes on the PPP,” Cosette Canilao, executive director at the PPP Center, told GMA News Online in an interview at her office.

The decades-old Build-Operate-Transfer (BOT) Law is a major problem—as pointed out by the private sector—and a hindrance to the bidding process.

PPP Center wants to introduce new changes into the BOT implementing rules and regulations (IRR) by January 2014, just over a year after amended IRR was released.

“An intermediate IRR” will cut the tedious multi-agency approvals needed in changing draft concession agreements of PPP projects, while the actual law amendment eyed within the current Congress is still in the works, Canilao said.

Big-ticket projects can help sustain P850 billion worth of infrastructure developments annually, which the Asian Development Bank (ADB) considers a must for the Philippines to keep growing at seven percent, attract foreign direct investments, and alleviate poverty.

But without an intermediate IRR, the PPP program seems doomed to stagnate. Revisions to concession terms will—again—have to be approved by an inter-agency committee before it is forwarded to President Benigno Aquino III, who has the final say.

This tedious process of amendments and approvals is what is keeping the government from bidding out the rehabilitation works on Southeast Asia’s first light rail transit, called LRT 1.

Two months ago, bidding for the LRT 1 was stunted after government received a conditional and non-compliant bid from Metro Pacific Investments Corp., the lone bidder, who went for it without partner Ayala Corp.

Three other bidders, mainly high-profile conglomerate their their foreign partners, backed out the last minute, and pointed out the expected returns—under government’s own terms—will not suffice in making up for the economic and political risks the project entails.

Lessons from the past?

In an e-mail to GMA News Online, Transportation Department spokesperson Michael Arthur Sagcal noted that coming up with the terms that are mutually acceptable to both government and prospective partners from the private sector is a great hurdle.

“Our main challenge is balancing the interest of both government and the private sector… Not wanting to leave behind a legacy of questionable projects, we are doing our best to make sure that public money is spent wisely, prudently, and in the best interest of the people,” Sagcal said.

How risks are spread is a common ground for disagreements hounding most PPP projects. In the end, concession agreements had to be revised stretching out the bidding time frame in the process.

The irony is that both the government and the private sector use the supposed lessons from past failed biddings in defending their respective positions on the matter, with the government arguing on the need for caution to avoid awarding contracts that would later be criticized as disadvantageous to the public.

Nightmares of “flawed” undertakings like the Metro Rail Transit 3 (MRT 3) prompt government to view contracts under a microscope and sprinkle it with stringent performance indicators the private sector must meet, said a government official—who asked not to be named due to the controversy of the subject—to GMA News Online.

A 2010 World Bank publication noted that in 1993, the Philippines accepted foreign exchange, demand, and revenue risks while guaranteeing a 15 percent return on equity for the MRT 3—a mass rail transit system that plys through the Metro Manila’s main thoroughfare, EDSA.

MRT 3, however, attracted lower-than-expected passengers and required billions of pesos in government subsidies. The latter had to be raised because petitions for higher fares were unapproved in the face of stiff public opposition.

The government is now mulling over a complete buy-back of the concession to avoid shelling out money for the subsidy.

Still, “a long list of historical contracts shown to have overly favored the private sector… should not be an excuse for their inability to reach positive deals with the private sector,” noted Bank of the Philippine Islands (BPI) economists Nicholas Antonio Mapa and Emilio Neri Jr. in an e-mail to GMA News Online.

In the case of LRT 1, government stood firm on its position that real property and income tax risks should be borne by the winning bidder. As a result, companies backed out to avoid getting caught in a financial squeeze.

In an ambush interview a week after the Aug. 15 LRT 1 bidding, which was declared a failure, Ayala Corp. managing director John Eric Francia shared his fears. “My concern was the risk was real from where I sit,” he said.

The government has since agreed to shoulder some of the risks originally assigned to the private sector.

For what they were worth, such lessons from the past were part of the “birth pains phase,” said Tala Fernando, managing director at BF Corp., part of the group of consortia that bagged the P16.28-billion contract to build 9,300 classrooms for the Department of Education under the PPP initiative.

“Both the government and investors are trying to find comfort levels,” she noted in an e-mail, saying the disagreements with government over design and building methodology took time until these were ironed out before the project was finally awarded last year.

A major concern by the private sector is the uncertainty about whether or not future administrations would honor the contract. The fear stems from an ongoing international arbitration over the Ninoy Aquino International Airport Terminal 3 with a German contractor.

“The private sector needs to be afforded a higher rate of return for possible changes in the rules of the game along the way,” Mapa and Neri said.

The economists noted the private sector needs “compensation for the risk that contracts will not be honored every six years” or when a new administration assumes office.

On ‘institutionalization’

To address regulatory risks, including “any breaches” by future administrations, the government has earmarked P30 billion in next year’s budget to set up a contingent liability fund, said PPP’s Canilao.

A separate fund for feasibility studies and manuals on processes will be drafted into the proposed amendments to the BOT Law that is now being reviewed by economic managers, she said, adding that an Executive-approved bill for consideration by the 16th Congress should be out in the summer of 2014.

“The institutionalization is very important,” the PPP official noted.

Despite a history of “failed” contracts, the institutional problem seems odd as the current PPP flow is actually viewed as one of the best in the world.

“The Philippines stands out very well in setting up a PPP standard,” ADB president Neeraj Jain said in a telephone interview. “Your ASEAN neighbors have long wanted to push for a standard PPP format and for a center handling PPPs. They have not achieved that much.”

Projects under Aquino’s PPP program took no more than 18 months to reach financial closure from when invitations to bid were released. This was on a par with Canada and Australia, and deemed faster than the 22-month minimum for the UK and India to seal a deal.

“I cannot say in a clear-cut manner that there are delays. Yes, expectations of both private sector and government have not been met, but we know that necessary blocks are there,” said Jain.

An understandable dilemma

The fear boils down to this: Not enough number of projects will be awarded while funds are there, or investors’ interest will fizzle out once the most popular president steps down less than three years from now in 2016.

“The accommodative financing environment should embolden investors, both the private and public sectors to take advantage while the tap is flowing,” said BPI economists Mapa and Neri.

The dilemma on the part of government is understandable, but the danger of sliding back remains a threat to infrastructure development.

“I understand the government’s teething problem, but it’s disappointing… I hope things don’t get pushed back again,” Eduardo Francisco, president at BDO Capital Investment Corp., said in an interview.

Decades of neglect by past administrations have made simply obvious the fact that Philippines needs to improve its decrepit infrastructure, and the clamor is there to pursue that path of development.

“We’re willing to finance, but there are no projects to bid for now,” Francisco said.

From the current pipeline of at least 47, only four projects worth a combined P43 billion were actually awarded three-years after the program was unveiled. 12 of the proposed projects were in advanced-approval stages—and likely to be awarded during Aquino’s term.

“In a fight or flight situation, we choose to fight despite bruises from criticisms, because we believe that what we do will change the way the government does business,” PPP Center’s Canilao said. – VS/VC, GMA News


New PPP players sought by gov’t

Business World, 24 September 2013

THE GOVERNMENT is looking to entice a new group of players — insurers — to join its vaunted public-private partnership (PPP) program.

“We have to develop infrastructure as an asset class that market players can invest in,” Finance Secretary Cesar V. Purisima said following last week’s government briefing on the economy.

“This is why we have been working to boost the capitalization of insurance companies, because their money is the better match for infrastructure projects,” Mr. Purisima added.

While the insurance sector has held key roles in funding infrastructure development in other countries, here it is still not the first choice among project proponents. Those who may be interested, meanwhile, have no formal system to find partners.

Industry officials noted that they need investments to park the premiums they collect.

Rizalina G. Mantaring, president and chief executive of Sun Life of Canada (Philippines), Inc., estimated that the average liability duration of insurers is 19 years. The average duration of assets like stocks and bonds, however, is only 10 years.

Big-ticket infrastructure projects like toll roads, railways and airports, in contrast, are constructed, developed and operated over much longer terms.

The Organization for Economic Cooperation and Development calls insurance money “patient capital”. It warned in a June 2013 paper that the financial system was running short of such in the wake of the 2008 global crisis.

Michael T. Rodriguez, Macquarie Infrastructure and Real Assets managing director, painted a different problem in the Philippines. “There is so much wealth in the economy right now, but there is nowhere to put it. That is why the money keeps going to the short-term market which is more volatile,” he said.

Sun Life, the country’s largest insurer, amassed P20.06 billion in premium income in 2012 alone. “We are actively looking at PPP projects right now, since they can offer the better yield and duration for us,” Ms. Mantaring said.

“In Canada, Sun Life is the biggest individual investor in infrastructure programs.”

Despite the money on offer, Ms. Mantaring said Sun Life was having difficulty attracting proponents of infrastructure projects.

“Banks are thought of more naturally when people think of loans or funding,” she noted.

Some project proponents also look to the debt markets but the long-term bonds they issue typically have a tenor of 10 to 15 years since investors don’t have the appetite for anything longer. Insurers can lock up funds for 20, even 25 years, she said.

Mr. Purisima said one way of bringing insurers into the PPP program was to issue infrastructure-linked bonds, which are currently being considered by the government.

PPP Center Executive Director Cosette V. Canilao said that over the next two to three years, the government could issue the long-term bonds and allow insurers purchase the bulk. The proceeds will be used to finance projects.

Ms. Canilao also urged investment banks to arrange infrastructure project bonds.

“Local banks will commonly lend for 12-15 years, so there will be refinancing risks for the project proponents. Investment banks should tap insurers to make sure there are no refinancing risks. On the fifth or seventh year of a project when cash flows stabilize, they can issue project bonds,” she said.

Antonio G. de Rosas, president and chief executive of Pru Life UK — the country’s second-largest insurer with P15.59 billion in premium income last year — said investment banks could arrange and underwrite the bonds and then invite insurers to the primary offer.

Until then, insurers are working by themselves to meet project proponents and offer their funding. “Here there appears to be no interest” in bringing the two parties together, Ms. Mantaring said.

“Perhaps the government can help by more actively working with insurance companies when projects are bid out to put them together with interested bidders,” she added.

Ms. Canilao offered: “We have held infrastructure summits. We are also thinking of holding some sort of networking and business-matching event. We will keep in mind the Insurance Commission and insurers.”

Mr. de Rosas was more optimistic, saying: “As more and more projects are approved, credit arrangers will get around to requesting funding requirements not only from banks but also from insurance companies.”


Seven more PPPs to be rolled out in H2

Business Mirror, 7 September 2013

THE Public-Private Partnership (PPP) Center is eyeing to roll out around seven more PPP projects before the end of 2013.

Rolling out PPPs, according to the PPP Center, involves the publication of the Invitation to Prequalify to Bid. This means that the PPPs have already been designed and passed the evaluation process of concerned government agencies.

In a briefing on Friday, PPP Center Executive Director Cosette Canilao said these projects are either being evaluated by the National Economic and Development Authority through the Investment Coordination Committee (ICC) or will be submitted to the ICC for evaluation.

Canilao said these projects include the Integrated Transport System (ITS) Project, Grains Central Project, the New Centennial Water Supply Source Project and Bulacan Bulk Water Supply Project, which are currently undergoing evaluation.

She added the list includes the Enhanced Operation and Maintenance of the New Bohol (Panglao) Airport, Operation and Maintenance of the Laguindingan Airport and the regional prison facilities project of the Bureau of Corrections (BuCor).

The P5.06-billion-worth ITS involves the establishment of three mass-transportation intermodal terminals at the outskirts of Metro Manila. Two terminals in the South of Metro Manila will serve passengers to and from Laguna/Batangas side and those to and from the Cavite side and another one will serve passengers north of the city.

The P285-million-worth Grains Central Project involves the rehabilitation, upgrading, expansion and operation and management of 11 existing Post-Harvest Processing and Trading Centers.

These are currently managed and operated by the National Agribusiness Corp.  located in different regions in Luzon and Mindanao.

The New Centennial Water Supply Source Project, whose cost has yet to be determined, involves the building of potential dams; head works and appurtenant facilities; conveyance structure from the diversion point to the water-treatment facility; water- treatment facility; and hydropower facility.

The Bulacan Bulk Water Supply Project involves the construction of treated water transmission mains, including line appurtenances from water treatment plants (WTPs) to the agreed delivery/interconnection points of the municipalities.

It will also construct WTPs and ancillary facilities; treated water reservoirs; pumping stations; installation of flow metering devices after the WTPs, pumping stations, transmission branch points and at the agreed delivery/interconnection points; and installation of appropriate pressure monitoring stations.

The Panglao airport project involves the operation and maintenance of the greenfield airport facility in Bohol to replace the existing Tagbilaran Airport within a 230-hectare spread.

The planned facility to be constructed by the Department of Transportation and Communications (DOTC) is designed primarily to meet the initial requirements for domestic flight operations and possibly accommodate international flights during off-peak hours/nighttime.

The Laguindingan airport project involves only the operation and maintenance of the airport in Misamis Oriental. The DOTC is constructing the new airport in Misamis Oriental as well as airside civil works (runways, apron, taxiway, etc.) and air navigational facilities.

The DOTC is also undertaking landside building works and terminals (passenger and cargo terminals and other associated facilities) and all other facilities as per international Civil Action Organization standards.

The BuCor project aims to address the dire jail conditions faced by existing penal facilities such as the New Bilibid Prison and the Correctional Institution for Women.

The Department of Justice and BuCor envisions to create a “humane” prison condition that will provide adequate living spaces, facilities and basic needs aimed to curt the occurrence of crimes while in custody.


Govt considers P2-B subsidy for LRT-1 Cavite

Rappler, 7 September 2013

SUBSIDY. The government may shoulder P2-billion-worth of real property taxes in the LRT-1 Cavite extension project. Photo courtesy of the PPP Center SUBSIDY. The government may shoulder P2-billion-worth of real property taxes in the LRT-1 Cavite extension project. Photo courtesy of the PPP Center

MANILA, Philippines – After several delays and the failed bidding for the P60 billion LRT-1 Cavite extension project, the government is mulling a P2 billion subsidy to get the rail project going.

This is among the changes in the project’s terms of reference that the Department of Transportation and Communications (DOTC) is seeking approval for, according to Public-Private Partnership (PPP) Executive Director Cosette Canilao.

Canilao said the DOTC’s Special Bids and Awards Committee is working on getting the nod of the National Economic and Development Authority (NEDA) Board for government to subsidize the real property taxes (RPT) to be included in the new concession agreement.

“We need the approval of the NEDA Board, but we’re still taking away the variables. RPTs will be absorbed by government, “ she added.

Canilao has earlier said RPTs amount to almost P2 billion.

She explained that payment of the real property taxes, which will be imposed by the local government units, was the deal breaker when 4 of the pre-qualified bidders withdrew.

“For LRT-1, the RPT really became an issue,” she explained.

Three out 4 firms withdrew their participation shortly before the opening of the technical proposals last August 15.

The lone bidder, Light Rail Manila Consortium of Pangilinan-led Metro Pacific Investments Corp., however, failed to meet the requirements of the bidding, which resulted in a failure of bidding.

Canilao said rebidding for the railway project will be conducted before year-end.

The LRT-1 Cavite Extension project is among the biggest PPP projects under the Aquino administration.

The project will extend the existing 20.7-kilometer LRT-1 by 11.7 km, with a new south endpoint in Bacoor, Cavite.

The new line is expected to increase the ridership of LRT-1 from 500,000 to 700,000 passengers per day, and provide faster and more convenient mode of transportation to residents of Cavite, Las Piñas and Parañaque. –


PHL still has ‘shortest’ PPP procurement timeline

Business Mirror, 07 September 2013

DESPITE delays that have caused many investors to become impatient on the country’s public-private partnership (PPP) projects, the PPP Center believes the Philippines still has one of the shortest timelines for PPPs.

At a news briefing on Friday, PPP Center Executive Director Cosette Canilao said procurement timelines begin with the publication of the Invitation to Prequalify and Bid (ITPB) and ends with the start of the construction or groundbreaking. After financial closing, projects begin construction.

Data showed that it only takes the Philippines 14 to 18 months between the ITPB and financial closing to occur, the same as Australia.

The shortest procuremet timeline in Philippine PPPs is for the PPP for School Infrastructure Project (PSIP) Phase 1, which only took 12 months. The ITPB for the project was published on January 8 and the financial close was achieved a year after.

To date, the Ninoy Aquino International Airport (Naia) Expressway Project is taking the longest procurement time among all PPP projects that have published ITPBs. The notice to proceed for the project is estimated to be released in January 2014, more than a year after the ITPB was published in July 2012.

PPP Center data showed that the longest procurement timelines for PPPs globally is in South Africa at 35 months, and the United Kingdom, 22 to 35 months.

In Europe the average procurement timeline is 22.3 months, while in India, it takes 24 months. Canada, on the other hand, consume 16 to 18 months from ITPB publication to financial closing.

The Philippines’s PPP Program was launched in October 2010. Since then, the government has been able to award three PPPs. These are the Daang Hari–South Luzon Expressway Link Road, PSIP 1 and the Naia Expressway Project.

The current pipeline of the PPP Center for projects that are on various stages of development, apart from the three awarded projects, consist of 43 infrastructure projects. Around seven projects are now undergoing bidding, while one is securing National Economic and Development Authority Board approval and another one has completed the Neda Investment Coordination Committee (ICC).

Further, two projects are undergoing ICC Technical Board approval; the design for five projects are currently being finalized; around eight are undergoing their feasibility studies; another eight are currently procuring transactional advisers; and 10 are currently being conceptualized.