Business World Online, October 21, 2011
THE GOVERNMENT is pushing through with plans to tap concessional loans to kickstart public-private partnership (PPP) projects, starting with the planned extension of a Metro Manila railway.
As a consequence, the line’s operations and maintenance contract — part of the first PPP project originally offered to investors — will be pushed back further, the department indicated.
The centerpiece PPP program, originally touted by the government as a solution to the country’s infrastructure lack — has been hit by delays due to protracted project reviews and leadership changes at concerned agencies.
Out of an initial list of 10 big-ticket infrastructure deals announced last year, only the P1.956-billion Daang Hari-South Luzon Expressway link deal is currently on the table. The first project offered to investors, the combined LRT-1/MRT-3 operations and maintenance contract, has been recalled by Transportation Secretary Manuel A. Roxas III.
The government recently said it was now seeking to begin the projects instead of bidding these out to the private sector, reasoning that it would be better to use favorable loan terms from ODA and other facilities. Only when projects are finished would operations and maintenance contracts be bid out, officials said.
The PPP program was originally also touted as spurring 7-8% economic growth this year. The growth goal has since been slashed to 5-6% and President Benigno S. C. Aquino III has said the first project award would likely be made only in January next year.
Mr. Roxas, in the statement, claimed that the “PPP program is on track and there are no delays. The feasibility studies are being completed by either end of this month, or next month for those which are already in place. We are now going through the analysis of these projects to determine the most effective way to implement them.”
Some projects in the PPP program “will be funded partially through PPP, PPP/concession agreement, PPP/ODA, and through the General Appropriations Act”.
He claimed that other projects were also being firmed up. In particular, the Laguindingan Airport in Misamis Oriental that is currently being constructed will open next year.
“We expect the airport to open late next year and we’re finalizing the bid documents for the operations and maintenance of the terminal. Once construction of the terminal is complete, the private sector can step in to operate the facility,” Mr. Roxas said.
The North Rail project was also described as on track as “China has conveyed to the Philippine government their willingness to top-up or to continue to finance the project.”
The project, however, is currently not under the PPP program.
