MANILA, Philippines – Taipans and their conglomerates may be tapped to put up big-ticket infrastructure projects under the administration’s planned Public-Private Partnerships (PPPs) program, according to the government.
Budget Secretary Florencio Abad said taipans are eyeing projects in power, water supply, agriculture, transportation and communications, general infrastructure such as tourism–related projects.
“There are people who have expressed interest, quite a number, in fact,” he said.
“But definitely, there are a number of both local and foreign institutions, businesses, investors that have expressed interest.”
Abad said joint ventures would mean greater stake of Philippine investors in Philippine development.
However, it was too early to identify the interested investors, as well as the list of possible projects, he added.
Abad said the government expects P180-billion to P200-billion worth of PPP projects next year.
The National Economic and Development Authority (NEDA) hopes this would increase to P400 billion in 2013, he added.
The Philippine Public-Private (PPP) Coalition for infrastructure projects has already listed a number of “ready-to-go” projects that the administration may implement immediately, according to documents prepared by the Research, Education & Institutional, Development (REID) Foundation Inc., a member of the PPP Coalition.
These include the P13.9-billion Cavite-Laguna Expressway, a second terminal of the Diosdado Macapagal International Airport (DMIA) in Clark amounting to P7.6 billion, and a high-speed rail from DMIA to central business districts amounting to P138 billion.
The Coalition, composed of the Philippine Constructors Association, Bankers Association of the Philippines, Investment Houses Association of the Philippines and REID Foundation, also listed a list of “pipeline projects,” including various water projects such as Bulacan Treated Bulk Water Supply Project amounting to P5.5 billion, the Marikina River Basin Sewer System amounting to P7 billion, the San Juan River Basin Sewer System amounting to P14 billion and the Boracay Water and Sewerage System amounting to P1.1 billion.
The Coalition said the next step is for the government to approve the list of projects and to recommend to President Aquino the creation of a PPP Infrastructure Council to review major policy issues and uncork interagency bottlenecks.
Faced with a budget deficit that is projected to hit P325 billion this year, the administration wants to use government funds mainly for social services and tap the private sector for needed infrastructure projects.
Private sector help sought
Socioeconomic Planning Secretary Cayetano Paderanga Jr. is seeking the private sector’s help in increasing investments through overseas remittances.
“We have funds coming in through overseas Filipinos and we should be able to take full advantage of it,” he said.
Paderanga said the idea is to merge private and public governance so people can be confident with their investments. “We can mobilize these funds that are just going out of the country as consumption,” he said.
Paderanga said the private sector can provide better investment vehicles for overseas Filipinos.
“We have to give overseas Filipinos investment vehicles that they can also count on as part of their pension,” he said.
Paderanga said a seven to eight percent gross domestic product (GDP) growth rate is workable if a higher investment rate can be attained and the cost of doing business can be reduced.
“The Philippines is in a situation where the savings rate actually surpasses the investment rate,” he said.
“We have liquidity sloshing in our banks. We can use it for more productive purposes.
“If we are using these funds to beef up our industrial strength by importing new technology and machines then we can be more competitive, including in our exports.”
The government has been trying to provide Filipinos abroad with investment opportunities so the dollars they send home would grow and translate to higher income.
The administration is eyeing the private sector’s help to spur investments in infrastructure.