Naia PPP put on hold

A massive public-private partnership (PPP) auction to expand and privatize the operations of Manila’s Ninoy Aquino International Airport (Naia) has been put on hold as the government decides to first come up with a comprehensive Luzon air gateway master plan, the head of the PPP Center said.

PPP Center executive director Ferdinand Pecson said last week that multiple government agencies, led by the Department of Transportation (DOTr), were reviewing new and existing airport proposals with the main goal of addressing air congestion in Manila and growing traffic elsewhere.

“We need to have a complete and holistic approach to airports for the greater capital region,” Pecson told reporters.

Naia, the country’s busiest air gateway, is considered the crown jewel of airport PPPs.

The Naia PPP was conceived under the Aquino administration as a P75-billion project that also involved modernizing facilities and building a new passenger terminal. It was approved by President Duterte in September 2016.

Given its importance, the project easily lured interest from the country’s biggest conglomerates, which expressed their intention to bid for the Naia PPP once it was auctioned off.

But it also drew heavy criticism, chief of which was the fact that the current Naia site faced limited long-term expansion and the best way to address growing congestion was to build a brand-new international airport. Naia handled 39.5 million passengers last year against its design capacity of 31 million passenger annually.

In response, two private-sector proposals have emerged: San Miguel Corp. and a group led by businessman Wilson Tieng and taipan Henry Sy Sr.

SMC made a proposal for an “aerotropolis” on roughly 2,000 hectares of land in Bulacan, north of Metro Manila. The airport itself would have at least four runways and would be located about 40 minutes from the Makati City financial district.

Separately, Tieng and Sy-led All-Asia Resources and Reclamation Corp. proposed to reclaim about 2,500 hectares of land in offshore Sangley Point, Cavite. It would then be redeveloped into a new airport, seaport and industrial estate.

Meanwhile, the DOTr signaled that it wanted the underutilized Clark International Airport in Pampanga province to play a bigger role in decongesting Manila’s air traffic while growing its share of flyers from the rest of Luzon.

“The Department of Transportation is looking at these various options they now have on the table,” Pecson said. “That means they have to decide this together with the new airport [proposals], Clark’s development and then Naia because these are going to affect one another.”

In a report last month, think tank CAPA Center for Aviation cautioned that the government was moving “slowly” in deciding on a new airport, which would take years to complete.

“In the meantime, it is imperative for authorities to invest in upgrading and improving the existing airport,” CAPA said. It said pursuing a PPP, which likely required a long-term concession of about 25 years, might also dampen prospects for a brand-new replacement airport.