Source: Business Mirror, 8 January 2012

By Cai U. Ordinario

THE country’s development partners are open to doubling their assistance to the fund that finances the feasibility studies to jump-start more public-private partnership (PPP) projects this year.

The Project Development and Monitoring Facility (PDMF) is a revolving fund managed by the PPP Center. It aims to finance costly pre-investment studies needed to make projects viable under PPP arrangements. The amount spent for the pre-investment studies on a project is reimbursed by the winning bidder to the PPP Center but only after the project is awarded.

National Economic and Development Authority (Neda) Director General Cayetano Paderanga Jr. said development partners are open to provide an additional $11-million to $13-million assistance for the PDMF this year.

Last year the Australian and Canadian governments, together with the Asian Development Bank (ADB), extended a Capacity Development Technical Assistance (CDTA), a grant, of around $6 million for the PDMF.

“There is a possibility that our development partners will double their assistance. They approached us that they are willing to recommend an increase in their assistance to the PDMF,” Paderanga said.

As all official development assistance (ODA) loans and grants need counterpart funding, Paderanga said, the government has allotted an additional P160-million budget for the PDMF in the 2012 budget and some agencies have agreed to give up their PPP budgets in favor of the PDMF.

In the 2011 budget, the government set aside around P15 billion for the PPP projects of infrastructure-intensive agencies such as the Department of Public Works and Highways (DPWH), Department of Transportation and Communication (DOTC) and Department of Agriculture (DA).

In an earlier briefing, PPP Center Executive Director Cosette Canilao said the current amount of P550 million in the PDMF would be depleted by midyear.

Around P284 million has already been used to finance the pre-investment studies on 10 of the 16 PPP projects to be rolled out this year. The other six projects’ pre-investment studies have been financed through implementing-agency funds and donor assistance.

Apart from this year’s scheduled 16 projects whose pre-investment studies have already been funded, the PPP pipeline includes 43 others that have not yet undergone pre-investment studies. These studies are crucial in project preparation and evaluation because they cover the design and scope of the project and give a sense of how much it would cost to implement and complete a project under a PPP scheme.

Documents obtained by the BusinessMirror showed that this pipeline includes 15 projects to be implemented by the DOTC; nine projects by the DPWH; eight with local government units (LGUs); and two each for the DA and the Metropolitan Waterworks and Sewerage System (MWSS).

The list of pipeline projects also includes one project each for the departments of education, justice, finance, foreign affairs and national defense, the National Irrigation Administration, the Office of the Solicitor General, the Technical Education and Skills Development Authority and the Land Transportation Office.

The 10 projects funded under the PDMF are the P25 billion worth MWSS New Water Supply; the P10.4- billion PPP for School Infrastructure Project (Batch 1); the P10.15-billion Mactan Terminal 2 Airport Development and the P8-billion New Bohol Airport; the P7.8-billion Laguindingan Airport Operations and Maintenance; the P5.3-billion Cold Chain Systems Project; the P5-billion Modernization of the Philippine Orthopedic Center; the P1.8-billion Common Fare Collection System; P1.5 billion Rehabilitate-Operate-Transfer of the Angat Hydro Electric Power Plant Turbines 4 and 5; and the P900-million Vaccine Self-Sufficiency Program of the Department of Health (DOH).

The 10 projects on the list of 16—worth P154 billion—to be rolled out this year. The remaining six ,whose pre-investment studies are not funded under the PDMF, will be funded through implementing agencies or multilateral aid. These are the P20.18-billion NLEx-SLEx Connector Road; the P20-billion Balara Water Hub; the P19.69-billion Cala Expressway (Cavite and Laguna Side); the P11.3-billion LRT 2 East Extension; the P4.2-billion Puerto Princesa Airport and the P1.25-billion Grains Central Project.