Naia privatization plan falls through

Transportation Secretary Arthur Tugade said on Monday efforts to privatize Manila’s Ninoy Aquino International Airport (Naia) have stopped, ending hopes for significant upgrades and expansion during the pandemic-induced slump in air travel.

The roughly P100-billion Naia rehabilitation project fell victim to delays due to stringent government requirements and more recently, political opposition.

It was launched during President Duterte’s term to address worsening congestion in Naia and also in response to the administration’s decision to scrap the Naia development public private partnership project under President Benigno Aquino III.

Tugade said the project was no longer pushing through and the government would upgrade the country’s main gateway on its own.

Expand passenger capacity

“Notwithstanding the stoppage of the unsolicited proposal on the improvements of Naia, transformation continues to go on and on as we speak,” Tugade said during a government infrastructure briefing ahead of the President’s State of the Nation Address.

Tugade pointed to Department of Transportation projects such as repairs at Naia’s runways and taxiways, however, the private sector rehabilitation plan was more significant in scope.

The latest offer from Megawide Construction Corp. and GMR Infrastructure, the group behind the Mactan Cebu International Airport, included investments to expand both passenger capacity and flights apart from an elevated railway system linking Naia’s terminals.

The 25-year proposal was publicly opposed by Rep. Jericho Nograles and it was eventually rejected last December by the board of the Manila International Airport Authority (Miaa), which cited a narrow and rarely used definition of financial capacity to disqualify Megawide.

Waiting in line after Megawide-GMR were Philippine Airport Ground Support Solutions Inc. and food, drinks and infrastructure conglomerate San Miguel Corp.

Tugade did not immediately respond to queries on Monday on the status of their proposals.

The private sector’s push to upgrade Naia started in 2018 when the group of conglomerates known as Naia Consortium submitted its proposal to Miaa.Those negotiations lasted over two years and collapsed in July 2020 when the consortium withdrew during the COVID-19 pandemic.

The failure to rehabilitate Naia leaves the gateway to vulnerable to changes in government policy under a future administration.

San Miguel Corp. president Ramon S. Ang said the airport was better off being closed after his P735-billion airport city in Bulacan province, northwest of Manila, is finished.

SMC itself has submitted a 10-year proposal to operate and maintain Naia without any major redevelopment.