DOTC: PPP projects to boost FDI inflows

Rappler.com
DOTC: PPP projects to boost FDI inflows
The agency says the successful bidding of the AFCS and Cebu airport expansion will attract more investments into the country
MANILA, Philippines – The Department of Transportation and Communications (DOTC) said the Philippines can expect a boost in foreign direct investments (FDI) after the successful bidding of two major infrastructure projects worth a combined P19 billion.
On Sunday, April 6, DOTC Secretary Joseph Emilio Abaya said the Philippines’ stature as an investment destination would be enhanced with the decision to award the P1.72-billion Automated Fare Collection System (AFCS) for the country’s rail transit systems and the P17.5-billion Mactan-Cebu International Airport expansion project.
On Friday, April 4, DOTC stood firm on its decision to award the airport expansion project to the consortium of Megawide Construction Corporation and GMR Infrastructure even after Senator Serge Osmeña sought to stop the agency from signing a concession agreement with the group.

DOTC’s decision to award the project came after the second highest bidder, the Filinvest Group of business tycoon Andrew Gotianun, raised objections against GMR-Megawide, questioning the group’s financial capability to take on the project and alleging conflict-of-interest violations.

In December last year, GMR-Megawide submitted the highest bid of P14.404 billion for the project, followed by Filinvest – CAI Consortium with P13.999 billion.

Osmeña asked the Supreme Court to stop the agency from awarding the concession agreement. In response, Abaya said the agency covered all legal bases to justify its decision, but added that it would abide with whatever decision the High Court hands out.

“We will have to honor any court issuance that will prevent the project from moving forward, even if we believe that there is no more time to waste in improving the country’s second busiest airport,” he said.

The PPP project seeks to upgrade the Philippines’ second-largest international gateway with the construction of a new passenger terminal building that can accommodate 8 million passengers.

The existing terminal building, which can accommodate 4.5 million passengers, will also be expanded. Since 2012, the terminal has been operating at over-capacity with 6.7 million passengers.

Growing investor confidence

Abaya said new PPP projects would enhance the image of the Philippines as a prime investment destination, attracting FDIs and boosting the economy.

Figures from the central bank showed FDIs rose 20% to $3.86 billion in 2013 from $3.2 billion in 2012, indicating growing investor confidence.

Abaya said “honest and competent governance” would help sustain the upward trend.

“If we promise honest and competent governance, we must show it.  If we promise a level playing field, we must do it,” Abaya said.

He added, “By sticking to bidding rules and refusing to be influenced by external factors, we are showing the world that the country now has an excellent investment climate. Gone are the days when big-ticket contracts would be awarded despite being tainted with irregularities.”

Last March, DOTC also signed a 10-year concession agreement with the AF Consortium led by conglomerate Ayala Corporation and infrastructure giant Metro Pacific Investments Corporation for AFCS, a single ticketing system for the Metro Rail Transit and Light Rail Transit (MRT-LRT). – Rappler.com

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