Gov’t pushes PPP Act to sustain infra gains beyond PNoy term

MANILA, Philippines - The government is pushing for reforms to sustain the momentum of the Public-Private Partnership (PPP) projects even after President Aquino steps down from office in June 2016.

PPP Center executive director Cosette Canilao said the government is pursuing the enactment of the PPP Act that would amend Republic Act 7718 or the Build Operate Transfer (BOT) Law.

“The enactment of the PPP Act will ensure that the PPP program and the deal flow will continue in the next administration regardless of whoever takes over,” Canilao said.

She pointed out that the proposed PPP Act has already been forwarded to both the Senate and the House of Representatives.

“We hope both chambers will act on passing the law as it will be one of the major measures to ensure sustainability of our economic growth,” she added.

The rollout of PPP projects in the Philippines is in full swing after the award of seven projects worth close to P68 billion including the Daang Hari – South Luzon Expressway link road (P2 billion), PPP for School Infrastructure Project Phase 1 (P8.86 billion), the PSIP-2 (P16.28 billion), the modernization project for the Philippine Orthopedic Center (P5.98 billion), the Ninoy Aquino International Airport expressway (P15.52 billion), the automated fare collection system project (P1.72 billion), and the Mactan – Cebu International Airport expansion project (P17.5 billion).

The award of the P65-billion Light Rail Transit Line 1 Cavite extension project as well as the P35.4-billion Cavite – Laguna expressway project are now pending due to questions raised by losing and disqualified bidders.

The Aquino administration is set to roll out 18 PPP projects worth P407 billion before June next year as part of the inventory of over 50 projects in the pipeline.

The government has launched the biggest PPP project to date, the P123-billion Laguna Lakeshore expressway dike project; the P24.4-billion Bulacan Bulk Water supply project; the P4-billion Integrated Transport System (ITS) – South terminal; and the P2.5-billion ITS-Southwest terminal.

It is set to roll out the PPP portion of the P265.3-billion North-South commuter rail worth close to P70 billion; the subway system Mass Transit loop (P132 billion); the operation and maintenance of Davao Airport (P39.7 billion), Iloilo Airport (P29.7 billion), Bacolod Airport (P19.8 billion), Laguindingan Airport (P14.3 billion), Puerto Princesa Airport (P5.01 billion), the new Bohol (Panglao) Airport (P2.28 billion), the Regional Prison Faciities through PPP (P39.4 billion), the Motor Vehicle Inspection System (P18.9 billion) and the Tanauan City public market (P381.2 million).

The government has yet to determine the cost of several projects including the San Fernando Airport, the Batangas-Manila natural gas pipeline, the Manila Bay-Pasig Ferry-Laguna lake ferry, and the proposed extension of the Light Rail Transit Line 1 (LRT-1) all the way to Dasmariñas in Cavite instead of only Bacoor City under the P65-billion LRT-1 Cavite extension project.

Canilao said the robust pipeline of projects is due to the reforms the government initiated primarily by the establishment of the PDMF, the PPP Governing Board and the new project evaluation process wherein the PPP Center is the secretariat to the ICC for PPP projects.

“We are hoping to institutionalize these reforms on the proposed amendments to the BOT Law (PPP Act),” she added.

Moody’s Investor Service has cited the accelerating infrastructure projects under the PPP scheme of the Aquino administration.

Moody’s associate managing director Patrick Mispagel cited the expanding PPP market in the Philippines in a special comment titled “Global P3 Landscape,” providing a region-by-region round-up of major themes in infrastructure investment.

Mispagel noted the accelerating deal flow for PPP projects under the Aquino administration and the PPP Center despite the constraints on regulatory framework in the region.

“Despite these constraints, Moody’s report notes that the PPP markets in the Philippines and China are expanding, with deal flow accelerating in the Philippines under the current administration and its PPP Center,” he said in a statement.