Tycoons move to save plan for Naia expansion

/ 05:09 AM April 23, 2019

A consortium of the country’s largest conglomerates is preparing a compromise offer in a bid to convince the Duterte administration to move forward with an unsolicited offer to upgrade and expand the congested Ninoy Aquino International Airport in Manila (Naia).

Cosette Canilao, chief operating officer of Aboitiz InfraCapital, which is part of the seven-member Naia Consortium, said Monday they would soon submit a revised proposal to the Department of Transportation (DOTr), which had earlier set an April 30 deadline to finalize negotiations with the private sector.


“We are going to comply with the deadline and in a matter of days we will have an announcement,” Canilao said in a press briefing ahead of parent firm Aboitiz Equity Ventures Inc.’s annual meeting Monday.

Canilao declined to detail the specific areas of disagreement between the private sector and the DOTr.


However, multiple sources said a major issue involved the wording on the standard safeguards granted to the private concessionaire in the event that the Naia project is affected by a national government action.

This is also known as a material adverse government action, which covers any significant negative impact a national government agency act may have on the project proponent under its concession contract.

Sources said the government did not want to guarantee the impact of any change in future laws, which would significantly increase the risk profile of the project. Naia Consortium earlier offered to spend P102 billion—most of which would be deployed early on through the 15-year concession period.

Naia Consortium, whose members are among the country’s largest conglomerates, first proposed in February 2018 to upgrade Manila’s main gateway. Its initial offer to operate Naia through a 35-year concession was rejected by the DOTr, which favors closing Naia in favor of a brand-new gateway near Manila within a decade.

If the DOTr approves its latest proposal, the project will still require the final say of the National Economic and Development Authority. The original target was to start upgrades by September this year.

Naia Consortium is hoping to augment capacity at the massive airport complex, which has limited expansion options given its location surrounded by dense commercial and residential areas within Metro Manila.

Based on its offer, it will increase capacity to support 65 million passengers annually versus Naia’s design capacity of 31 million passengers per year. It also targets to increase hourly takeoff and landing movements to 52, up by a third.


Naia currently serves more than 40 million passengers per year.

Apart from Aboitiz, Naia Consortium’s members include Ayala Corp., Alliance Global Group Inc., Asia Emerging Dragon, Filinvest Development Corp, JG Summit Holdings Inc. and Metro Pacific Investments Corp. Its technical partner is Singapore’s Changi Airports International.

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TAGS: Airport, Business, NAIA
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