Government poised to suffer huge losses from NAIA 2

The government is poised to suffer huge financial losses because of its decision to allow the soft opening of the Ninoy Aquino International Airport (NAIA) Terminal 3, which would make NAIA Terminal 2 consistently operate on a loss, airport workers warned.

The airport workers, belonging to the Scrap the Piatco Deal Coalition, said Terminal 3’s operations will result in NAIA 2 incurring heavy losses yearly and the government servicing its (NAIA 2’s) huge loans to foreign creditors.

Romy Sauler, Scrap spokesman, said Manila International Airport Authority (MIAA) general manager Edgardo C. Manda has confirmed the huge losses to be incurred by NAIA 2 if all international airline operations are transferred to NAIA 3 during the recent Senate hearings on the Philippine International Air Terminals Co. Inc. (Piatco) contract.

Manda has informed the Senate committees that conducted the investigation that starting next year, the government will start servicing the loans incurred in the construction of NAIA 2 in the amount of P700 million a year for the next 20 years.

Without the income to be generated from NAIA 2’s international airline operations, the government will be hard put servicing these obligations, he said.

Manda said that based on their projections, MIAA would incur a loss of P416 million in 2003, P391 million in 2004, P302 million in 2005, P272 million in 2006, P162 million in 2007 and so on.

"The losses to be incurred by NAIA 2 will have a negative effect on the net income of MIAA itself. This will have an impact on our capability to service our foreign obligations," Manda said.

He stressed that because of MIAA’s yearly negative income, "the servicing of loans will be shouldered by the government."

Manda’s disclosure prompted senators to comment that although the government would be getting a guaranteed annual payment from the operations of NAIA 3 and a share in gross revenues and terminal fees, its (government’s) earnings would be offset by its loan obligations.

Sauler said they could not understand why there is a need to give the operations of the new airport to the private sector when NAIA 1 and 2, which are run by the government, are operating profitably.

Sauler said while the Piatco contract requires all domestic airlines to transfer operations to NAIA 2 once NAIA 3 starts operating, Terminal 2 is not configured to accommodate the bigger and newer jets.

He said local airlines like Cebu Pacific, Air Philippines and Asian Spirit still have old planes in their fleet, which are not compatible with the newer equipment and facilities at Terminal 2.

Citing as an example, Sauler said the aero bridges of Terminal 2 cannot service the existing fleet of Air Philippines and Asian Spirit and other smaller airlines.