If Finance Secretary Carlos G. Dominguez III has to choose which the government should prioritize, it will be the development of New Clark City over San Miguel Corp.’s (SMC) proposed P735.6-billion “aerotropolis.”
“Our priority is the New Clark City development. We have put money in it, we started that—obviously, that’s our priority,” Dominguez told reporters late Monday when asked which would take a backseat in case the government had to choose between the two big-ticket projects.
Dominguez also told a joint hearing of the Senate public services and economic affairs committees earlier in the day the proposed Bulacan airport might affect the development of the Clark International Airport and the Clark Freeport Zone as a whole.
“All airport projects are real estate projects. The real estate value of the New Clark City is currently $14 billion and the government has committed an additional P12 billion. We wanted to know how the Bulacan airport, which is just 65 kilometers away from Clark, will affect the value of the New Clark City, which is by the way, the property of the Filipino people,” Dominguez told senators.
Dominguez had expressed reservations on SMC’s airport proposal, as its subsidiary San Miguel Holdings Corp., the project’s proponent, was deemed “incapable” of building the massive infrastructure given that its capitalization of P60 billion in 2016 was dwarfed by the high project cost.
Dominguez sought the execution of a joint and several liability agreement ensuring parent firm SMC’s guarantee that its subsidiary can finish the project.
Dominguez said that even if SMC’s airport project was an unsolicited bid and would be implemented at no cost to the government, “there’s no such thing as free.”
“Everything is going to have a cost. There is no such thing as a free lunch. Either the passengers will pay for it, the airlines will pay for it, or the taxpayers will pay for it,” Dominguez said, citing the contingent liabilities incurred for such public-private partnership projects.
Dominguez, however, maintained the government was working to address congestion issues at the Ninoy Aquino International Airport, including the development of Clark as another gateway.
“We also want a better air service for the Metro Manila area. According to the studies before, the current Naia, as it is now, has reached the point of diminishing returns. In other words, whatever money you put in there, it won’t return to you the same amount,” Dominguez said.
“So other airports are important. My job is to increase the values of the government’s assets,” the Finance chief added.
Negotiations are already ongoing between the Department of Transportation (DOTr) and San Miguel Holdings for the final terms of the concession agreement, before it is subjected to Swiss challenge.
The proposed new international aerotropolis, or a metropolis revolving around an airport, would involve a massive complex to be built on a 2,500-hectare property in Bulakan town.
The airport project, which was already awarded an original proponent status by the DOTr, would have an initial capacity of 100 million passengers or over three times that of the Naia.
SMC said it planned to complete the project within six years.