Business World, 08 November 2012

INVESTORS should look closely at projects being offered by the Philippines’ public-private partnership (PPP) program, as the government continues to refine its model, speakers at a forum on the PPP and infrastructure yesterday said.

The Philippines can also benefit from experiences of other countries that have implemented PPP programs, as well as technical assistance to help build capacity in agencies that will implement projects.

“Fundamentals and preconditions for PPP in the Philippines are here, so it’s not good for investors to miss the train so to speak,” said Aziz Haydarov, country economist of the Asian Development Bank (ADB) during his speech in the forum organized by United Kingdom Trade and Investment (UKTI).

There are still “challenges” like ensuring the sustainability of projects even with a change in administration as well as inconsistent contracts, but there are programs available in the ADB that are helping the Philippines craft new models, the ADB official said.

PPP Center Executive Director Cosette V. Canilao said the government’s PPP scheme has taken off two years after it was introduced.

“We are being very transparent so we can ensure contracts and processes are valid. There are also moves to craft a PPP law that will have rules about joint ventures, operations and maintenance, and unsolicited bids,” Ms. Canilao said in her presentation.

Only two PPP projects have so far been awarded by the government since the flagship program was first unveiled, with much fanfare, in late 2010.

The first, the P1.96-billion Daang Hari-South Luzon Expressway Link Road project, was awarded to Ayala Corp. last December. The second, the P16.5-billion School Infrastructure Project that involves the design, financing and construction of about 9,300 classrooms in three Luzon regions, was awarded last month to the consortiums of Citicore Holdings Investment, Inc.-Megawide Construction Corp., Inc. and BF Corp.-Riverbanks Development Corp.

The third could be the P60-billion Light Rail Transit Line 1 expansion project.

Four groups — the Light Rail Manila consortium led by Ayala and Metro Pacific Investments Corp., SMC Infra Resources, Inc., DMCI Holdings, Inc. and the MTD-Samsung consortium — last week submitted prequalification documents.

Invitations to bid and bid documents for the Orthopedic Center modernization project are scheduled to be released in the second week of November.

Vietnam and the UK said there are significant experiences on PPPs that they can share with the Philippines.

“The UK is open to help the Philippines in its PPP and we are keen on it as it drives transparency. Our work with the government for the PPP has increased bilateral ties between the Philippines and the UK,” said Andrew Hinton, UKTI business specialist.

He added the UK has set up training programs for local government units that will implement PPP projects, as well as business matching activities by bringing British businesses to the Philippines.

Pham Thanh Tung, director-general of Vietnam’s International Cooperation Department under the Ministry of Transport, said the Philippines could learn from Vietnam’s pilot projects that had tested various PPP models. — Emilia Narni J. David