Pangilinan-led MPIC to Duterte admin: Let's start with a clean slate
MANILA, Philippines – The chairman of infrastructure conglomerate Metro Pacific Investments Corporation (MPIC) has a message to President-elect Rodrigo Duterte: Let us put an end to arbitration cases and start with a clean slate.
MPIC had filed separate arbitration cases against regulators under President Benigno Aquino III's watch for refusing to implement water and toll rate adjustments, which were promised under existing contracts.
"There's got to be a clean-up. We don't want to be in a case with the government. No business group would want to be in that situation where you are in dispute with the government," Manuel V. Pangilinan said on the sidelines of an annual stockholders' meeting in Makati last Friday, May 27.
If these cases are left unsolved by yearend, Duterte will inherit over P12 billion in compensation claims, MPIC chief finance officer David Nicol told reporters.
"For the water and roads businesses, claims are going up all the time. Water is heading towards P7 billion, and for the roads, it is in the north of P4 billion by the end of the year," Nicol said.
MPIC's water group Maynilad Water Services Incorporated had won an arbitration case regarding its 2013-2017 water tariff, which the Metropolitan Waterworks and Sewerage System (MWSS) still ignores.
Meanwhile, its unit Manila North Tollways Corporation last month filed a notice of arbitration before the UN Commission on International Trade Law in Geneva, seeking P3 billion in compensation for the government's inaction on toll hike petitions.
"We would really love to end the arbitration. It would be a good signal to the business community. If businessmen are uncertain about his attitude towards business, this is the perfect opportunity for him to allay their fears," MPIC president and CEO Jose Maria Lim said on the sidelines of the meeting.
Lim added that MPIC is also seeking P1.9 billion in claims for the government's failure to deliver promised additional light rail vehicles, in connection with its Light Rail Transit Line 1 (LRT1) Cavite Extension contract.
"In the matter of LRT1, obligations of the government to the respective concessionaire remain unfulfilled," Pangilinan said.
"If there is any solution to that represents a compromise...So that we, the government, and the country can move forward, especially with respect to LRT1 expansion," the MPIC chairman added.
"Clearly any business group will have to determine how to work with a new environment – whether it's President Duterte or somebody else. Everybody has to plan accordingly."
Lim also said that MPIC will be "very reasonable" in looking for solutions together with the new government.
MPIC's net income surged by 19.89% in 2015 to P15.07 billion from P12.57 billion in 2014, due to strong performance across all subsidiaries, despite uncertainty in tariff rate adjustments for its water, rail, and toll road businesses. – Rappler.com