More private firms seen joining ‘build, build, build’

Even with the tighter rules to be imposed on public-private partnership (PPP) projects, the country’s chief economist is optimistic that more private firms will participate in the Duterte administration’s ambitious “Build, Build, Build” infrastructure program.

Socioeconomic Planning Secretary Ernesto M. Pernia told reporters last week that “they [the private sector] know already” that provisions deemed detrimental to the government would not be included in PPP contracts.

The rules to be put in place will be “more stringent than during the previous administration,” said Pernia, who heads state planning agency National Economic and Development Authority.

“We want to make sure that PPP projects are going to benefit the people—that is why we don’t want government guarantees, subsidies, [and] anything having to do with Maga (material adverse government action),” Pernia said.

The PPP guidelines to be issued by the government will also serve as a model for future contracts, especially for airports.

“What we did for Bulacan, Clark and Bohol-Panglao [airports] will be the template for Davao and Laguindingan,” Pernia said, referring to the pending unsolicited proposals from Dennis Uy-led Chelsea Logistics and Infrastructure Holdings Corp. and the Aboitiz Group, respectively.

But Pernia said regional airports would no longer be lumped together into a single PPP project, as was done during the previous administration.

Last week, presidential adviser for flagship programs and projects Vivencio Dizon told the Inquirer that the Aboitiz Group’s unsolicited proposal to operate and maintain the New Panglao Bohol International Airport, the San Miguel Corp. (SMC)-led Bulacan International Airport and the rehabilitation of the country’s main gateway, Ninoy Aquino International Airport, to be undertaken by seven conglomerates were among the 26 PPP projects included in the longer Build, Build, Build list that covered 100 projects.

Dizon said other “major” unsolicited airport PPP projects were also made part of Build, Build, Build.

Only nine of the original list of 75 projects had private sector participation—eight PPPs and one to be implemented by a private firm.

The interagency Investment Coordination Committee-Cabinet Committee and the Committee on Infrastructure last week approved the new Build, Build, Build pipeline, which Pernia said was still subject to further refinements.

Pernia said the Duterte administration had been “very restrictive—it took us almost a year just to pass the O&M [operations and maintenance] for the Bohol Panglao International Airport… because it goes to so many iterations.”

“We want to make sure, of course, that we won’t get sued—there’s always a danger when we’re not so careful about dealing with projects,” he added.

In anticipation of more PPP projects included in Build, Build, Build, the Department of Budget and Management last week reiterated the mandatory reporting of project spending and contingent liabilities.

Joint Memorandum Circular No. 2018-1 issued by the DBM and the PPP Center in December last year standardized the monitoring and reporting of both government and private sector spending on PPPs. —BEN O. DE VERA