Bohol-Panglao airport upgrade proposal gets Neda board OK

The Aboitiz Group’s plan to upgrade and operate the Bohol-Panglao International Airport could start as early as 2020, marking progress in the government’s plan to privatize select regional gateways that have stalled since the early days of the Duterte administration.

The power, banking and food conglomerate’s infrastructure arm Aboitiz InfraCapital Inc. earlier made a P3.8-billion unsolicited offer to operate and develop the Bohol-Panglao Airport, which opened on Nov. 28 last year.

On Friday, the offer won the approval of the National Economic and Development Authority (Neda) board. This will pave the way for the start of a required bidding through a Swiss or price challenge, which is expected to be held in early 2020.

According to the Department of Transportation (DOTr),  Aboitiz’s offer assumed the start of “initial enhancements and the installation of internal fit-outs of existing facilities” from 2020 through 2021. Other upgrades could come online starting 2026 depending on demand.

“It is our hope that this new airport will help propel development in Bohol and the rest of the Visayas,” Transportation Secretary Arthur Tugade said in a statement on Wednesday.

But the planned privatization of the project has a history dating back to the previous administration’s Public Private Partnership (PPP) program.

Bohol-Panglao, which started construction in 2015, was among five provincial gateways that were being bid out to interested private sector groups during the tail-end of the Aquino administration.

A number of prospective bidders—including Aboitiz, Metro Pacific Investments Corp., San Miguel Corp. and Megawide Construction Corp.—had hurdled the pre-qualification stage and were waiting for the new administration to complete its transition in 2016.

However, the DOTr later scrapped the PPPs and opened the door to new unsolicited offers.

The other original PPP airport projects were gateways in Davao, Bacolod, Iloilo and Laguindingan. Private sector offers for these four gateways have yet to be approved by the government.

Partly causing delays were varying policy shifts under the Duterte regime.

In June, the DOTr announced that unsolicited offers for existing gateways should align with the contract signed by a consortium led by JG Summit Holdings and Filinvest Development Corp. for the Clark International Airport in Pampanga province on Jan. 2019.

The Clark Airport contract was deemed advantageous for the government given the level of risk it assigned to the private sector. This included the limits on compensation that would be triggered in favor of the concessionaire should national government actions have a negative impact on the project.

Since the start of the Duterte administration, five business groups have made unsolicited bids for nine existing provincial air gateways.

Aboitiz had also bid for the Laguindingan Airport while companies controlled by businessman Dennis A. Uy were vying for Davao International Airport, Bacolod-Silay Airport and the Busuanga Airport. Manuel Villar Jr.’s group, meanwhile, is seeking to operate and develop Iloilo International Airport and Puerto Princesa International Airport.

Philippine Airport Ground Support Solutions Inc., controlled by businessman Jefferson Cheng had made an offer for Siargao’s Sayak Airport while the group of Mega 7 Construction Corp., which had links to the Cusi family, had bid for Kalibo International Airport.