Privatization woes

With a number of airports, including the Ninoy Aquino International Airport (NAIA) soon to be privatized, a group of airline companies have urged government to regulate private sector operations of airports, just like water and energy companies, to ensure that all interests are protected.

The Board of Airline Representatives (BAR) has asked the Philippine Competition Commission (PCC) to appoint an economic regulator for airports who will protect the interest of all users including passengers, airline companies and airport service providers.

BAR’s members include the country’s domestic airlines, namely Philippine Airlines and Cebu Pacific and some of the biggest foreign airlines operating in the country.

The group, in a letter to PCC chief Arsenio Balisacan, said independent economic regulators for airports in other countries have been very effective in creating a level playing field that benefits all airport users, even as it warned that airport operators, if left unchecked, could exert significant unilateral market power.

The Department of Transportation recently held a prequalification conference for regional airport public-private partnership or PPP projects involving the airports in Bohol, Laguindingan, Davao, Bacolod, and Iloilo. Last year, it also disclosed a PPP scheme for NAIA.

While public interest would be served better if private sector resources are deployed to build and manage certain airport terminals, BAR said the privilege given to the private sector should be subject to reasonable regulation and supervision by the government through different agencies such as the PCC.

The group said that while a private entity may be authorized to exclusively operate a local or international passenger terminal, government has the right and the duty to ensure it is done in accordance with public interest, without infringing on the rights of the airlines, their service providers, and the travelling public at large.

In particular, it said airlines must be allowed to make their own choices of airport service providers, from among suitable qualified options.

It added that inadequate government oversight could result in airlines being forced to pay exorbitant prices for the use of the newly privatized facilities, which could raise prices for airline passengers and the public.

In an earlier position paper submitted to NEDA, the group urged the government to ensure that regulatory safeguards would be in place when it privatizes the operations and development of NAIA.

It wants government to guarantee that airlines are free to either self-handle airport operations or select their service providers as long as they comply with government-set guidelines, and to reserve the authority to regulate prices for airport services to make sure that these are reasonable to all stakeholders.

Not so hidden agenda

TEAM PHILIPPINES MEETING: The Tourism Educators and Movers Philippines has elected its new set of national officers for 2017-2019 during its annual general membership meeting at the Wine Museum Hotel and Resto. Shown in photo are founder and chairman emeritus Dr. Robert Lim Joseph (center standing) with (from left, seated) Angelie Vizconde, Manila Tytana College, secretary general; Dean Melanie Saro, University of Baguio, president; and Gina Balahan Montes, STI West Negros University, VP external affairs. Standing from left are Alex Ylagan of LPU Batangas (VP for internal affairs), Joseph and Dominique Martel Leaño Soriano of Far Eastern University (treasurer). Not in photo is Xander Kim Sigua of Holy Angel University (auditor).

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