Gov't revokes NAIA consortium's original proponent status for rehab proposal

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Metro Manila (CNN Philippines, July 9) – The Manila International Airport Authority has revoked the original proponent status for the group of conglomerates seeking to upgrade the Ninoy Aquino International Airport, the Transportation Department said.

In a statement dated July 8 but released to the media on Thursday, MIAA said it "has terminated negotiations with the NAIA consortium" and is withdrawing the group's status. An original proponent status gives a company the right to match other groups' offers and win the project under a Swiss challenge, a bidding process that allows rivals to submit competing offers.

READ: NAIA rehab plan hits another bump as gov't rejects fresh proposal from private contractors

On Tuesday, the consortium said authorities have turned down their revised proposal to upgrade the Ninoy Aquino International Airport.

The NAIA Consortium said they had to revise their proposed terms to factor in the "long-lasting consequences" of the pandemic and ensure the viability of the project, but that the state "is not willing to accept most of the consortium's proposed options."

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On Wednesday's pre-State of the Nation Address briefing, Finance Secretary Carlos Dominguez III said the group stated in a letter to Cabinet officials that they are not confident if they can still finance the major project that would revamp the country's biggest gateway.

Dominguez also revealed there are other private groups keen to take on the project.

"I understand that the DOTr (Department of Transportation) under Secretary Tugade as well as Vince Dizon, who heads the infrastructure projects, are in conversation with two more potential proponents for the NAIA project," he said.

"These two other proponents are willing to get into an agreement with the government which are very similar to terms of the agreement between the project proponents in the Clark airport and BCDA (Bases Conversion and Development Authority). We're not worried about it, we believe that these other two proponents are willing to step up to the plate here," he added.

Dominguez, however, did not name the two firms involved.

The global coronavirus crisis has paralyzed air travel and tourism for months now, with major airlines abroad going bottom up. Local operators Philippine Airlines, Cebu Pacific, and AirAsia have resorted to layoffs to keep their businesses afloat.

The NAIA Consortium is composed of Aboitiz InfraCapital, Inc.; AC Infrastructure Holdings Corp.; Alliance Global Group, Inc.; Asia’s Emerging Dragon Corp.; Filinvest Development Corp.; and JG Summit Holdings, Inc. Tycoon Manny Pangilinan's Metro Pacific Investments Corporation said in March that it will leave the NAIA Consortium, citing issues with real property taxes.

The big firms also tapped for technical support Changi Airport International, the operator of Singapore's airport which is deemed among the best in the world.

The companies said they can only move forward with the NAIA project under the new options they proposed. However, Dominguez pointed out that proponents of other public-private partnerships have not raised similar concerns so far.

The original contract price for the NAIA rehab plan was set at ₱350 billion for a 35-year concession period, which was scaled down to ₱102 billion for a 15-year deal. Tugade once threatened to cancel the project as the group seemed to be taking too long with its final pitch to repair the airport.

The government greenlit the consortium's plan to repair and upgrade NAIA in November after multiple revisions since February 2018, subject to a Swiss challenge.

Meanwhile, economic officials said the government is still on track in delivering the "Build, Build, Build" program, saying that they are counting on big-ticket infrastructure projects to help revive the economy.

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Public Works Secretary Mark Villar added that he does not expect long delays despite the pandemic, saying that construction work has resumed in most locations and some at 24/7 operations.

The Duterte administration is looking to spend as much as ₱8 trillion until 2022 for these projects, touting the President's term as the supposed "Golden Age of Infrastructure." Projects were delayed in 2019 due to the late passage of the annual budget, while lockdowns to prevent infections stalled heavy works earlier this year.