China-backed group bags Sangley Airport project

A bid to transform a former military base near Manila into a global aviation hub in a few years is moving forward after a Chinese-backed consortium formally bagged the project on Friday.

The Provincial Government of Cavite awarded the initial phase of the Sangley Point International Airport (SPIA) project to the consortium of State-run China Communications Construction Co. Ltd. (CCCC) and taipan Lucio Tan’s MacroAsia Corp., which disclosed the development to the Philippine Stock Exchange.

The award was expected given that the consortium was the sole bidder that submitted its joint venture proposal to the Cavite government last Dec. 17, 2019.

The parties are expected to sign the Joint Venture Development Agreement to be followed by 12-18 months for detailed engineering design and financial closing.

The SPIA has already lured controversy given its proximity to Metro Manila, located about 35 kilometers away, and CCCC’s role in building militarized islands in contested waters in the West Philippine Sea amid a broader territorial dispute with China.

Moreover, joint venture documents seen by the Inquirer stated that SPIA was among the projects identified in China’s Belt and Road Initiative. The same documents also indicated that a Chinese partner was preferred, prompting other potential bidders to back out of the project, sources said.

Cavite Gov. Jonvic Remulla told the Inquirer they were transparent with all bidders while he promised that SPIA, which would mainly be funded with borrowings, would not turn into a Chinese debt trap.

The award on Friday covered Phase 1 or P208.5 billion of SPIA’s total estimated project cost of P550 billion.

Project documents showed that Phase 1, which could open by 2022, involved the first runway and a passenger capacity of 25 million passengers per year. Under subsequent phases, SPIA will have up to four runways and a passenger capacity of 130 million annually, serving demand up to 2050.

The project is a massive undertaking that will involve the reclamation of over 1,400 hectares of land in Manila Bay. The goal is to decongest Manila’s Ninoy Aquino International Airport (Naia), which is operating well above its existing design capacity.

The award to the CCCC-MacroAsia comes a day before President Duterte inaugurates for commercial use the existing Sangely Airport, formally called the Major Danilo Atienza Air Base given its previous use by the Philippine Air Force.

The Sangley Airport will be redeveloped anew should the Cavite government’s SPIA proceed.

The Department of Transportation earlier said it would be reimbursed for its expenses in readying Sangley Airport, whose upgrade started two years ago.

Apart from SPIA, the board of the National Economic and Development Authority, which is chaired by Mr. Duterte, has approved the proposal of Naia Consortium to upgrade and expand Naia and San Miguel Corp.’s offer to build a new airport in Bulacan about 40 km north-west of Metro Manila. Both projects have yet to start as negotiations over their respective contracts are ongoing with the national government.