GMA News, 19 December 2013
By Siegfrid Alegado
More foreigners are expressing interest in the Philippines’ pipeline of big-ticket infrastructure projects under the public-private partnership (PPP) program, ranking government officials told reporters at a briefing Thursday.
“Nag-iincrease talaga ngayon yung interest ng foreign players. They like the pipeline,” said Cosette Canilao, executive director at the PPP Center, the agency overseeing and reviewing projects under the flagship program.
According to Canilao, most inquiries are from European and Asian firms.
Most foreigners are looking for partner local firms, noting that more are interested in partnering with companies “outside the usual list of [Philippine] conglomerates,” she said.
The increased interest in the country’s PPP projects were attributed to consecutive investment grade ratings from all three of the world’s top debt watchers that the Philippines snagged this year and the “improved” bidding process.
“This is because of the of the investment grade,” said Canilao. Manila scored its first investment grade rating ever from Fitch Ratings in March.
Standard & Poor’s lifted the Philippines away from junk status in May and Moody’s Investors Servicecemented the country’s status as a new investment hub in October.
At the same briefing, Jose Emmanuel Reverente, deputy executive director at PPP Center, said: “We are improving it (the bidding process) with respect to transparency and willingness to have comprehensive discussions.”
United Kingdom Trade & Investment director in Manila Iain Mansfield has said British firms are looking at participating in the country’s PPP projects.
Australia’s Macquarie Group Ltd. and a handful of Japanese and a Korean firms have participated in past biddings.
For the Philippines’ first airport PPP, the Mactan-Cebu International airport project, all local companies took in foreign airport operators as partners to compensate for their lack of expertise in the aviation industry.
Concerns, however, are still being raised by some foreign firms, particularly in possible breaches of contract.
But “for as long as the contract is clear and consequences are clear for every action of the government and winning bidder, then it’s okay for them,” Canilao explained.
She, moreover, said the government has earmarked P30 billion in next year’s budget to set up a rolling contingent liability fund addressing regulatory risks including any breaches by future administrations. Arbitration provisions are also provided for in PPP contracts. — JDS, GMA News