Transport gets lion’s share of PPP projects in PH

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Artist's rendition of the P17.52-billion Mactan-Cebu International Airport (MCIA) project. Photo from ppp.gov.ph
Artist's rendition of the P17.52-billion Mactan-Cebu International Airport (MCIA) project. Photo from ppp.gov.ph
Artist’s rendition of the P17.52-billion Mactan-Cebu International Airport project. Photo from ppp.gov.ph

The bulk of the Aquino government’s public-private partnership (PPP) projects is for the transport sector, with the Department of Transportation and Communications (DOTC) cornering 28 of the 57 projects in the PPP pipeline.

The entire DOTC portfolio amounts to P529.41 billion, said the PPP Center’s staff monitoring the projects.

Out of the seven awarded PPP projects, two are DOTC projects collectively worth P19.24 billion. These are the P1.7-billion Automatic Fare Collection System (AFCS) and the P17.52-billion Mactan-Cebu International Airport (MCIA).

“That’s roughly 30% of PPP projects awarded so far based on estimated project cost,” PPP Center executive director Cosette Canilao said in a statement.

DOTC was expected to generate some P15.6 billion in premium payments made by the winning bidders for the AFCS and the MCIA projects.

On May 28, the P64.9-billion LRT Line 1 Cavite Extension project, the third PPP project by the DOTC, was bid out. The Ayala-MPIC Consortium was the lone bidder who placed an offer for the right to build, operate, and maintain the rail project.

MTD-Samsung Consortium, DMCI Holdings, Ecorail, Globalvia, Megawide Construction Corp, and SMC Infrastructure Resources, Inc. all dropped out of the bidding.

Aside from the LRT Line 1 project, the DOTC is also in the process of bidding out the Integrated Transport System Project – Southwest Terminal worth P2.5 billion.

Another transport project seeking approval of the National Economic Development Authority Board is the operation and maintenance of the LRT Line 2.

“The PPP Center has a good working relationship with the DOTC and we look forward to continue working closely with them in the PPP projects they have lined up,” Canilao said.

Transportation Secretary Joseph Emilio Abaya admitted that in the beginning, due diligence needed in getting them off the ground was a huge challenge to the DOTC.

“We had to carefully study these projects and ensure we complied with the legal and procedural requirements of the BOT Law and its implementing rules and regulations. We had to learn by doing. There were critical decisions needed along the way, but eventually we got them right,” Abaya added.

The LRT Line 1 Cavite Extension project was rebid after prospective investors initially backed out.

Transport Undersecretary Rene Limcaoco explained: “It was back to the drawing board for us then. We had to unlearn some of our previous notions on project structuring and procurement. We learned to balance the interests of both the government and the private sector without compromising the project’s viabilities and its public service objectives. We are hopeful we will receive good bids for the LRT Line 1 project.”