NAIA rehab: Here's what a solicited PPP proposal could look like

MANILA, Philippines – The government is getting serious about the rehabilitation of the aging Ninoy Aquino International Airport (NAIA), as the Department of Transportation (DOTr) and the Manila International Airport Authority (MIAA) prepared a joint proposal on how the upgrade to its services and capacity should look like.

The two agencies have submitted their proposal to the National Economic and Development Authority (NEDA) board for approval. The project, a solicited public private partnership deal, would “increase the capacity of NAIA and ensure safe operations while significantly improving the passenger experience,” the DOTr said in a press statement on Friday, June 2.

Here are some of the project’s goals:

Higher passenger capacity
Shorter waiting and processing times
More comfortable and modern facilities
Better connectivity between terminals

Under the PPP agreement, a private concessionaire will acquire modern air traffic control equipment, rehabilitate the airport’s runways and taxiways, and upgrade the terminal’s existing facilities.

In return, the private concessionaire will have 15 years to run the airport and make a profit from its investment before turning it over to the government.

The DOTr said that this project would address the growing demand for air travel in the Greater Capital Region – which often refers to Metro Manila, Bulacan, Rizal, Cavite, and Laguna – while additional airports are built in the regions.

“Cebu and Clark have shown that when given the chance, private companies can provide excellent airport services to Filipino travelers and visitors to the Philippines,” DOTr Secretary Jaime Bautista said in a statement.

“With this project, it is our goal that travelers to and from Manila, our country’s main international gateway, also benefit from the improvements in efficiency and service that world class airport operators and investors can bring,” he added.

NAIA has been hounded by controversies – from being named the worst business class airport in the world to facing multiple complaints of passenger theft by security screening officers. The latest was on May 1, when a power outage disrupted the flights of 9,000 passengers while on New Year’s Day, the failure of air traffic equipment paralyzed the entire Philippine airspace and left more than 78,000 passengers stranded.

What about the MIAC proposal?

The DOTr and MIAA are considering both solicited and unsolicited proposals for the airport’s rehabilitation, with the Asian Development Bank (ADB) acting as a transaction advisor for both modes.

A solicited proposal is submitted by a company in response to a request made by the government, which usually already outlines certain terms and conditions. Meanwhile, an unsolicited proposal is submitted before any such request is made by the government.

Earlier in April – and days before the Labor Day airport fiasco – a super consortium of the country’s biggest conglomerates submitted a P100-billion unsolicited proposal for the rehabilitation of NAIA.

The new consortium – called the Manila International Airport Consortium (MIAC) – includes many of the conglomerates that were part of an older proposal for the same project, which eventually fell apart during the height of the global pandemic.

Although the DOTr has already acknowledged receipt of MIAC’s unsolicited proposal, Bautista said that his department was still in the process of conducting a “completion check” on it.

“The initial study is to have a solicited [proposal]. That’s the reason why we engaged ADB for help, for us to be able to entertain a solicited proposal. But since there is this unsolicited proposal, we have to work on it…. We are given 35 days to do the completion check, and that’s what we’re doing,” Bautista told reporters on May 10.