The powerful Investment Coordination Committee-Cabinet Committee (ICC-CabCom) of the National Economic and Development Authority (NEDA) Board has approved the unsolicited proposal for the operations and maintenance (O&M) of the Bohol Panglao International Airport (BPIA) in the resort island of Panglao.
In a statement issued Thursday, NEDA said that the ICC-CabCom approved the privatization of the P8.9-billion facility’s O&M under a 25-year concession period.
The long-awaited decision came almost a year after the airport’s inauguration and amid public clamor for the improvement of the facility’s services and amenities, which are currently overseen by the Civil Aviation Authority of the Philippines.
According to Socioeconomic Planning Secretary Ernesto Pernia, the government has been “very restrictive” with public-private partnerships as it exercised caution in engaging in PPP concession agreements.
This led to the slew of iterations in the terms for the BPIA’s O&M.
“It took almost a year just to pass the O&M for the Bohol Panglao International Airport and that’s because it goes through so many iterations,” Pernia said in a press conference in Pasig City on Wednesday.
“We want to make sure also that we won’t get sued when we are out of office already. There’s always a danger when you’re not so careful in dealing with projects,” he added.
The final approval for the unsolicited proposal will now be up to the NEDA Board (NB) which is chaired by President Duterte.
The ICC-CabCom is the highest decision-making body in the executive branch which takes action on proposals for major capital projects. However, “since it is a Committee of the NB, its decision on projects are presented to the NB for a formal confirmation,” according to NEDA’s ICC Guidelines and Procedures.
Meanwhile, the NEDA statement on the ICC-CabCom’s approval of the BPIA’s O&M and three other big-ticket infrastructure projects did not include the airport’s upgrade or expansion which was initially part of the unsolicited proposal.
An earlier report by The Philippine Star indicated that Aboitiz InfraCapital (AIC), which secured the original proponent status for the BPIA’s O&M and future upgrade, was told to make an adjustment that would entail a major restructuring of the proposal.
“What the ICC is now saying is let’s remove the augmentation, just make it O&M (operations and maintenance) only and then government will be the one to invest on the augmentation. The problem of the proponent is what if the government doesnt do the investment, then they will not be able to meet the minimum performance standards and specifications they have committed under the contract. If they cannot do that then they will be penalized,” Transportation Undersecretary for planning Ruben Reinoso was quoted as saying by The Philippine Star in an October report.
The mulled solution was for AIC to give two separate offers for the airport’s expansion and for the O&M.
Even before the inauguration of the BPIA in November last year, the AIC, the Aboitiz Group’s infrastructure arm, already announced its plans for the BPIA’s improvement eyeing a multi-billion budget for the endeavor.
It was earlier reported that the AIC was planning to spend an estimated P27 billion on the BPIA, which is the country’s first “eco-airport” dubbed the “Green Gateway to the World.”
“Our vision is to transform the New Bohol Airport into a prime example of excellence and efficiency for regional gateways,” said Sabin M. Aboitiz, AIC president and CEO, in an earlier statement.