Posts Tagged ‘Finance Secretary Cesar Purisima’

Gov’t to amend BOT law for PPP projects

Malaya Business Insight, 19 February 2014

By Angela Celis

 

The Aquino administration plans to amend the Build-Operate-Transfer (BOT) Law to better implement public private partnership (PPP) projects.

Finance Secretary Cesar Purisima said at the sidelines of the Philippines Investment Forum that he is hoping for the passage of the proposed amendments in the BOT law before the 2016 elections.

“We are working with congress already. There are many features in the amendments that can make it easier to implement PPP projects,” the finance chief said yesterday.

“The focus of this administration is to increase investments, reduce the infrastructure gap, and to make it easier to do business in the country,” he added.

Purisima said that one of the proposed amendments in the BOT law is the clearer provisions in the right-of-way acquisitions (ROWA).

“Right now, the ROWA can take some time. The government has a right of eminent domain and yet we’re held back by TROs (temporary restraining orders),” Purisima said.

“We want clearer provisions that would come up with mechanisms to determine how disputes in valuation will be dealt with without delaying the projects. Because sometimes the projects are held hostage because of this valuation provision,” he added.

Another amendment is in the taxation regime of some projects.

“This is a result of our experience with Pagbilao (power plant) where the local government unit tried to increase the tax to a point where the viability or the cost of that service becomes much higher than the rest of the country,” Purisima said.

“Therefore I think we need more clarity in this area,” he added.

 

Executive taps Congress to expedite BOT law amendments

GMA News, 18 February 2014

By Siegfrid O. Alegado

 

The Cabinet is already working with the 16th Congress in firming up changes to the Philippines’ law governing joint public-private projects in a bid to fast-track its approval, Finance Secretary Cesar Purisima said Tuesday.

A proposed measure amending the decades-old Build-Operate-Transfer (BOT) law is among “key legislation” the Aquino administration is pushing for in the remainder of the President’s term, Purisima told the attendees of the Euromoney Philippines Investment Forum. This forms part of its larger goal of attracting more long-term investments and addressing joblessness.

Purisima later told reporters that the draft Executive bill has been sent to Congress even as some provisions are still being studied.

“We’re already working with Congress,” he said, noting that the Executive wants the bill to move closer fruition before preparations for the next national elections in 2016 takes the spotlight in both the lower and upper house.

“As you know, next year we’ll be closer to 2016,” Purisima said. “And there will be more electoral noise; we’d like to have this done in this Congress.”

Among the key provisions agreed upon is a process of identifying “projects of national” significance, paving way for a new tax regime that would prevent too high a cost for the consuming public.

Moreover, an option to buy private sector proposals for big-ticket state projects and bid them out to other viable investors was drafted into the Executive-backed bill.

“Obviously, our preference has always been solicited,” Purisima said.

Amendments to the BOT law will ensure that current processes and contracts will be honored in succeeding administration, Cosette Canilao, executive director at the public-private partnership center, earlier told GMA News Online.

At the same forum, President Benigno S. Aquino III said the BOT law amendment will “smoothen working conditions with the private sector.” — BM, GMA News

 

Finance dep’t backs guarantee for MRT-7

Business World, 18 February 2014

By Lorenz Christoffer S. Marasigan

 

THE FINANCE department has endorsed performance undertaking for the P62.7-billion Metro Rail Transit Line 7 (MRT-7) Project to Malacañang, a cabinet official said.

  “We are waiting for the approval from the President. We wrote to the office of the Executive Secretary months ago,” Finance Secretary Cesar V. Purisima said, when asked for updates on the MRT-7 project, to be undertaken by San Miguel Corp.

Whether the project attains financial closure now rests in the President’s hands, Mr. Purisima said.

Financial closure entails having all requirements and necessary approvals, including performance undertaking, in place. Performance undertaking refers to a guarantee from the government that it will finance the project should the proponent be incapable of funding it.

San Miguel President and Chief Operating Officer Ramon S. Ang has said that the funding for the project is ready and that the firm is trying to fast-track the financial closure of the project, which he expects within the first half.

The original proponent of the project, Universal LRT Corp., failed to secure performance undertaking, thus failing to secure financial closure for the MRT-7 expansion.

The project entails the construction of 14 train stations starting from San Jose del Monte, Bulacan, to North Avenue, Quezon City. It will be connected to the existing MRT-3 and Light Rail Transit Line 1 via a common station on Epifanio de los Santos Ave.

‘HAVE PITY’
Meanwhile, Mr. Purisima appealed to Metro Rail Transit Holdings II, Inc. (MRTH-II), the parent company of MRT-3 asset holder Metro Rail Transit Corp. (MRTC), to consider the plight of commuters who use the railway.

“We really appeal to the private sector that is trying to slow down or stop this. Just look at the lines, have pity on these people and allow us to be able to expand the lines,” he said.

A temporary order of protection was set against the Transportation department, stopping the agency from procuring 48 train coaches from Chinese firm CNR Dalian Locomotive & Rolling Stock Co., which won the auction to do so early this year.

The government has been losing P9.9 million daily under the 20-day stay order, MRT-3 General Manager Al S. Vitangcol III said.

The government’s losses would reach roughly P198 million.

The train cars from Dalian were to beef up the existing 73-train fleet of the MRT-3 — the most crowded of Metro Manila’s mass railways — so that more cars could operate at more intervals during peak hours.

“We hope that the order preventing us from adding brand new LRVs (light rail vehicles) will be lifted immediately, for the public’s sake. The [Transportation department] will be able to increase MRT-3’s capacity within two to three years starting from the time that the court allows us to proceed. Since more passengers will be able to take the train, EDSA traffic should be mitigated considerably,” Transportation Spokesperson Michael Arthur C. Sagcal said in a statement.

PH trade mission on UK, Northern Europe rounds

Philippine Daily Inquirer, 22 September 2013

Riza T. Olchondra

 

Philippine trade officials and business leaders will be in Europe next month to try to translate marketing and promotions efforts into new investment pledges and partnerships.

Trade Undersecretary Ponciano Manalo told reporters that a high-level business delegation would be in London (hosted by UK Trade Minister Lord Stephen Green) on Oct. 2 and 3.

There will also be trips to Scandinavian countries and other sites in Europe with Philippine Economic Zone Authority (Peza) director general Lilia de Lima joining the rounds.

“The focus is investment. We will have a big delegation going there,” Manalo said. “Europe is undergoing financial difficulty but that doesn’t last forever. So we want to establish ourselves early,” he added.

About 23 firms and/or industries are expected to be represented.

Officials of the IT and Business Process Association of the Philippines (ITBAP); oil firm Shell; banks HSBC, Standard Chartered Bank, China Bank, and Planters Development Bank (through its chair, Ambassador Jesus Tambunting); British American Tobacco; Unilever; and airline firms will likely join, Manalo said.

Also in the London program are talks by Finance Secretary Cesar Purisima, Bangko Sentral ng Pilipinas Deputy Governor Diwa Gunigundo, Public Private Partnership Center executive director Cosette Canilao, and ITBAP president and CEO Jose Mari Mercado.

Besides targeting UK-based financial services firms, the Philippines is also looking for a British investors in automotive parts as well as animation.

After the UK meetings, Manalo will join at least 15 Philippine food exhibitors in Germany for the Anuga Trade Fair on Oct. 4 and 5.

He will also be on a roadshow in Stockholm, Sweden on Oct. 6 or 7, plus a one-day program in Finland with potential investors.

Meanwhile, Peza’s De Lima will be going to Copenhagen, Denmark and Oslo, Norway on Oct. 8 and 9.

“We shared the work on four countries in the Northern (European) area. Her focus is on information technology. Europe asked us to go and pitch for the Philippines so we are acceding,” Manalo said.

Besides manufacturing investments that could boost merchandise exports, the Philippine government is also seeking support for services, such as IT and animation work.

The services sector accounts for about a fifth of total exports and is seen to cushion the effects of a volatile electronics exports market.

The Philippines is aiming for at least a single-digit expansion in total exports (including merchandise and services) from last year despite volatile demand for electronics, according to Department of Trade Industry-Bureau of Export Trade Promotion director Senen Perlada, who is also the executive director of the Export Development Council.

 

First Meeting of the PPP Governing Board

11 September 2013

 

First Meeting of the PPP Governing Board

The PPP Governing Board, created through Executive Order No. 136, met for the first time last 06 September 2013 at the PPP Center. The Board is the overall policy-making body for all PPP-related matters, including the Project Development and Monitoring Facility. It shall be responsible for setting the strategic direction of the Philippine PPP Program and creating an enabling policy and institutional environment for PPP. Secretary for Socio-Economic Planning Arsenio Balisacan chairs the PPP Governing Board with Finance Secretary Cesar Purisima as Vice-Chairperson. Other members of the Board include the Secretaries of Budget and Management, Justice, Trade and Industry, Executive Secretary and the Private Sector Co-Chairman of the National Competitiveness Council. The PPP Center acts as the Secretariat of the PPP Governing Board.

 

 

 

 

Finance chief pushes changes to BOT law

Business World, 5 August 2013

By Bettina Faye V. Roc

 

THE GOVERNMENT is eyeing changes to the law governing infrastructure projects in a bid to increase their execution and delivery efficiency, a Cabinet official said.

Proposed amendments to Republic Act (RA) 7718 or the Build-Operate-Transfer Law — one of the Cabinet economic cluster’s priority legislative measures — focus on the idea of “strategic national infrastructure,” Finance Secretary Cesar V. Purisima said in an interview.

“We’d like it (the process) to be immune to the vagaries of local rules — like taxation and other policies — as all construction will be local but projects will not just be for localities but for the whole country,” he added.

The Finance chief said the amendments aim to enhance the implementation of infrastructure projects, particularly those under the government’s centerpiece public-private partnership (PPP) program.

For one, the government wants to include modalities such as joint ventures, concessions, and management contracts into the BOT Law.

“Right now, all those are under separate rules. So we’d like to consolidate those under the BOT Law so they’re all under one regulatory framework,” Mr. Purisima said.

Enhanced provisions on unsolicited proposals will also be included in the proposed amendments.

“We’d like to have the opportunity to convert an unsolicited proposal into a solicited proposal,” the Finance chief said.

“[F]or example, someone submits an unsolicited [proposal] but we like it, we can offer to reimburse the cost of the study and then make it a solicited proposal. Right now we can’t do that,” he explained.

Under RA 7718 and its implementing guidelines, solicited proposals only need the approval of the implementing government agency for the projects to proceed and be bid out.

Agencies are allowed to accept unsolicited proposals for evaluation only if the project involves a new concept or technology or is not part of the priority project list, and does not include a direct government guarantee, equity or subsidy.

The proponent is required to submit a feasibility study and a draft contract, among others. If the proposal is accepted by the implementing agency and eventually approved by the Investment Coordination Committee (ICC), the agency and the proponent will negotiate based on the ICC’s recommendations.

The negotiated contract will be then be used as the basis for a Swiss challenge or project’s terms of reference.

Under the Swiss challenge system, challengers will be given a chance to submit a comparative or competitive proposal. If the challenger submits a better proposal, the original proponent will be given a chance to match. If no challenge is submitted, the contract is automatically awarded to the original proponent.

The BOT Law amendments, said Mr. Purisima, will go hand-in-hand with proposed changes to RA 8974, otherwise known as the Act to Facilitate the Acquisition of Right-of-Way, Site or Location for National Government Infrastructure Projects and For Other Purposes that is also a priority measure of the economic cluster.

“We’d like to simplify the [right of way acquisition] process also. Anyway the country has the right of eminent domain. The only issue is valuation. But valuation should not hold back projects,” he said.

The government launched the PPP program in 2010 but so far only three projects have been awarded.

 

Tax reforms paved way for positive PH outlook

The Manila Times, 4 August 2013

By Mayvelin U. Caraballo

 

Tax collection reforms paved the way for the positive outlook of a Japan-based rating agency for the Philippines, according to the Department of Finance (DOF).

In a statement over the weekend, Finance Secretary Cesar Purisima commended Ratings and Investment Information Inc. (R&I Ratings) in changing its rating outlook for the country from stable to positive, while affirming its investment grade rating of “BBB-.”

“The gains of good governance are again recognized by those who monitor world economies, with our tax collection reforms and our landmark sin tax reform law contributing greatly to the positive outlook,” he said.

In its report, R&I cited the efforts of the government to improve fiscal consolidation, by laying out a plan to contain the fiscal deficit to 2 percent of the gross domestic product (GDP) by beefing up its tax collection capacity.

“The fiscal deficit for 2012 was 2.3 percent relative to GDP, a slight increase from 2 percent in 2011, due partly to public investment, whose execution pace returned to a normal level. The 2013 budget targets 2 percent in line with the mid-term plan,” it stated.

However, the ratings agency said that despite the significant increase in public investment in the country, research by the World Bank and other institutions suggests that the level remains insufficient.

It identified the fiscal position of the Philippines as a major constraint, adding that in 2012, tax revenues are only 12 percent to 13 percent of GDP.

“R&I positively views the government’s leadership in raising the sin tax levied on tobacco and alcohol beverages. Still, reform on the tax code and system aimed at a stronger tax collection capacity and better spending efficiency remains an important issue to be addressed,” it stated.

Earlier, the Bureau of Internal Revenue said that it eyes to raise its tax collection P1.6 trillion by 2015. For this year, the bureau is targeting a tax collection of P1.253 trillion, 17.59 percent higher than the previous year’s P1.058 trillion.

On the other hand, R&I also said that the political situation in the country had been consolidated after the inauguration of the government led by President Benigno Aquino 3rd in June 2010.

“The political situation in the Philippines has undoubtedly consolidated under the Aquino government. It is not an overnight task, however, to address the issues ranging from lack of infrastructure to the perception of widespread corruption in order to improve the investment climate,” it stated.

It also mentioned that the government significantly restored the peace of western Mindanao, a part of the island which used to ruin the country’s image.

“I commend R&I for noting not just the prudent fiscal management we have implemented under President Aquino, but the great strides we have taken toward lasting peace in Mindanao. With the recent signing of the wealth sharing annex to the Framework Agreement on the Bangsamoro, we have come closer to enshrining perpetual inclusive growth in law for all Filipinos,” Purisima added.