PRESS RELEASE: Aboitiz, Ayala Land, Megaworld, SM Prime form consortium for P123.8-B Lakeshore project bid

MANILA, Philippines, Friday, February 27, 2014 – Four of the biggest companies in the Philippines have formed a consortium to bid for the P123.8-billion Laguna Lakeshore Expressway and Dike Project (LLEDP).

Holding firm Aboitiz Equity Ventures, Inc. (AEV), real estate giants Ayala Land Inc. (ALI), Megaworld Corporation (MEG) and SM Prime Holdings, Inc. (SMPH) agreed to form Trident Infrastructure and Development Corporation (TIDC), and acting together, have formed a consortium in order to pre-qualify for the LLEDP and evaluate the feasibility of the project with the view of submitting a competitive bid proposal for what is considered to be the biggest public private partnership (PPP) project of the Aquino administration.

The project includes the construction of a 47-kilometer expressway and a 45-kilometer flood control dike, and the reclamation of around 700 hectares of land in the western part of Laguna Lake.

Dubbed as “Team Trident”, the consortium’s four members will each have an effective equal share of 25 percent. It combines the infrastructure expertise of the Aboitiz and Ayala groups as well as the reclamation and land development experience of Aboitiz, Ayala Land, Megaworld and SM.

The consortium also benefits from the combined financial muscle and the national and international network of experts that the four companies have, which will be able to benefit millions of Filipinos and thousands of businesses along the western shore of Laguna de Bay.

Trident brings together the expertise, experience, financial strength, and network that is needed to successfully execute a project the size and scale of LLEDP.

source:  Megaworld

First PH subway to run on 26th or 32nd Ave

DOTC studies P20-B savings from 1 of 2 alternative routes

The Department of Transportation and Communications (DOTC) is studying whether a proposed subway system below the 26th Avenue in Bonifacio Global City that costs P20 billion less would be the better alternative for a planned Mass Transit System Loop in the district.

DOTC Secretary Joseph Emilio Abaya said the original proposal was for a route below 32nd Avenue as part of the P370-billion Mass Transit System Loop (MTSL).

First Philippine subway
The planned MTSL project is intended to connect the fast-developing central business districts of Bonifacio Global City (BGC), the Makati Central Business District, and the Mall of Asia area in Pasay City.

The high-capacity MTSL will have interchange stations with the existing Light Rail Transit (LRT-1), the Metro Rail Transit (MRT-3), and the Philippine National Railways (PNR) lines along its approximately 12-kilometer long route. Almost the entire line will run underground, making it the first subway in the country.

The proposed alignment runs from the MRT-3 Taft Avenue station at Edsa, westward along Edsa to Macapagal Boulevard, northward to Sen. Gil Puyat (Buendia) Avenue, then eastward along Gil Puyat and Ayala Avenue to meet Edsa again in Makati.

In the original proposal, the subway line would follow Edsa northward for a short distance, then follow 32nd Street through BGC to Market Market. The new proposal is a straighter route to Market Market following McKinley Road and 26th Street.

The MTSL project, which was given initial approval by the National Economic Development Authority (NEDA) last month, is currently undergoing further evaluations while waiting for final approval of President B.S. Aquino 3rd in his capacity as head of the NEDA board.

The eventual private sector partner for the MTSL project is expected to finance, design, construct, operate and maintain the mass transit system.

The project has an indicative cooperation period of 31 years.

Cost-conscious
“The P20 billion is the difference in cost,” between the two BGC alignment options, DOTC Secretary Joseph Emilio Abaya told reporters. “Initially we were looking at 32nd [Avenue]. It’s costly, but [it’s] a predictable environment.”

“What is important is the project should be implemented, but NEDA suggested that we present the 26th (the new alternative route). So we will present. The P20 billion difference is significant in terms of schools, health centers and scholarships. It’s a huge amount,” Abaya explained.

source:  Manila Times

North-South commuter rail operations targeted for 2020

THE BIGGEST railway project of the government so far is expected to start commercial operations in 2020, after its public-private partnership (PPP) component on Monday secured final approval from the National Economic and Development Authority (NEDA) Board, a Cabinet official said on Tuesday.

Transportation Secretary Joseph Emilio A. Abaya said during a briefing in Mandaluyong City that the first phase of the P287-billion North-South Commuter Railway (NSCR) project is “targeted to be operational in the third quarter of 2020.”

The first phase of the NSCR, according to Mr. Abaya, will involve the construction of a 36.7-kilometer elevated commuter railway from Malolos, Bulacan to Tutuban, Manila. This will involve a project cost of P117 billion.

The construction period is targeted to start in the first quarter of 2017 and end in the third quarter of 2020, according to a presentation by the Transportation department.

The NSCR is being studied as an official development assistance (ODA)-funded project, though funding out of the National Budget is also an option.

“Initially, there is a (Japan International Cooperation Agency (JICA)) proposal to do it through ODA funding. So we’ve been instructed to talk to JICA; but... the government has the option to finance the project through the National Budget; we think it would be the fastest way,” Mr. Abaya said.

Once it becomes operational in 2020, the average daily ridership for the Malolos-Tutuban line is estimated at 340,000 passengers.

Meanwhile, the second phase of the NSCR, representing the PPP component of the deal, will involve commuter lines connecting Tutuban to the southern peripheries of Metro Manila plus a long-haul network to the Bicol provinces, with an initial terminus in Legazpi City and a branch line eventually connecting Matnog, Sorsogon.

The NSCR South Line PPP deal was one of the projects approved by the NEDA Board yesterday.

The Transportation department is targeting to start the construction period in the first quarter of 2016 and end in the fourth quarter of 2019.

“We are targeting to start the operations of the South Line in the first quarter of 2020, once we publish the invitation to bid in the second quarter this year and issue notice of award by yearend,” Mr. Abaya said.

“For a mega city like Manila, it is clearly a consequence of a growing economy is the growing capacity of our people to own their own vehicles -- clearly, with our traffic that is not the way to go. And the solution to that natural tendency is to develop mass transit systems. Thus government is investing in rails, in BRTs (bus rapid transit), likewise reforming the bus system,” Mr. Abaya said.

“As we are now, there is a right mix. 80% of our riding public really use public transportation, 20% use private cars. However, we are all in smaller modes like jeeps, tricycles and UVs (utility vehicles). The direction is to migrate the smaller PUVs (public utility vehicles) to mass transport systems and eventually migrate private owners into mass transit systems,” he added.

Nine PPP deals have been awarded since the program was launched in 2010: the P2.5-billion Integrated Transport System-Southwest Terminal project; the P17.52-billion Mactan-Cebu International Airport Project; the P64.9-billion LRT Line 1 Cavite Extension; the P1.72-billion Automatic Fare Collection System; the P2.01-billion Daang Hari-South Luzon Expressway Link Road; the P15.52-billion Ninoy Aquino International Airport Expressway; the P16.28-billion first phase of the PPP for School Infrastructure Project (PSIP); the PSIP’s P3.86-billion second phase; and the P5.69-billion Philippine Orthopedic Center modernization.

source:  Businessworld

Infrastructure projects get green light

FIVE PUBLIC-private partnership (PPP) projects and one other infrastructure venture cumulatively worth P372.82 billion were approved by the National Economic and Development Authority (NEDA) Board yesterday.

Communications Secretary Herminio B. Coloma, Jr. said in an e-mail to reporters that PPP projects that got the green light from the NEDA Board, chaired by President Benigno S.C. Aquino III, were the P24.303-billion expansion of Tarlac-Pangasinan-La Union Expressway (TPLEx); P117.304-billion North-South Commuter Railway Project (NSCR) Phase I; P170.7-billion North-South Railway Project (NSRP) South Line; rebidding of the P35.43-billion Cavite-Laguna Expressway Project with a minimum bid price of P20.105 billion; and the Swiss challenge of the P20-billion 8-kilometer North Luzon Expressway (NLEx)-South Luzon Expressway (SLEx) Connector Road, with rate of return increased to 9.93% from the current 8.64%.

The NSCR Project, targeted to be implemented from 2015 and operated for 35 years starting 2020, involves construction of a 36.7-km narrow-gauge elevated commuter railway from Malolos to Tutuban using the Philippine National Railways right-of-way with 10 stations and a depot at Valenzuela City. The project also includes procurement of rolling stock and installation of electro-mechanical systems.

The NSRP South Line -- which will run mainly from Tutuban Station in Manila to Legazpi City in Albay -- aims to rehabilitate the existing railway “to provide improved transport and logistics services to currently underserved areas and encourage more productive activities,” according to the PPP Center Web site. This project will also involve commuter railway operations between Tutuban and Calamba and long-haul railway operations between Tutuban and Legazpi. Furthermore, it will build branch lines from Calamba to Batangas, and from Legazpi to Matnog, Sorsogon.

The other project approved in the more-than-six-hour NEDA board meeting was the P5.087-billion Panguil Bay Bridge project of the Department of Public Works and Highways, which involves construction of a bridge across Panguil Bay connecting the City of Tangub in Misamis Occidental and the Municipality of Tubod in Lanao del Norte. This project, regarded as a high-priority development project in Mindanao, is targeted to be implemented from 2015 to 2018.

The Palace official added that funding for the approved projects will come from a combination of sources. “Some will be internally funded, some through loans, and some will have private equity funding,” Mr. Coloma said.

Socioeconomic Planning Secretary Arsenio M. Balisacan said in a statement “most of these projects aim to have a more reliable and efficient transport infrastructure system to increase investment in connective infrastructure.”

“These projects will support the government’s goal of increasing infrastructure spending to at least 5.1 percent in 2016. We hope that they will be implemented efficiently and effectively,” he added.

With approval by the NEDA Board, Mr. Coloma said these projects can now proceed to rollout stage -- involving publication of invitations to prospective bidders -- adding that the President also yesterday “directed the Cabinet and the NEDA members to focus on completing similar ongoing projects.”

The other proposed PPP projects that were scheduled to be taken up yesterday -- the P378.33-billion Makati-Pasay-Taguig Mass Transit System Loop Project; P13.33-billion Motor Vehicle Inspection System Project; and P1.16-billion Civil Registry System-Information Technology Project Phase II -- will be discussed in the next NEDA Board meeting, whose date has yet to be set, Mr. Coloma said.

Nine PPP deals have been awarded since the 2010 launch of this program: P2.5-billion Integrated Transport System-Southwest Terminal project; P17.52-billion Mactan-Cebu International Airport Project; P64.9-billion LRT Line 1 Cavite Extension; P1.72-billion Automatic Fare Collection System; P2.01-billion Daang Hari-South Luzon Expressway Link Road; P15.52-billion Ninoy Aquino International Airport Expressway; P16.28-billion first phase of the PPP for School Infrastructure Project (PSIP); PSIP’s P3.86-billion second phase; and P5.69-billion Philippine Orthopedic Center modernization.

source:  Businessworld

More PPPs up for NEDA Board approval

THE GOVERNMENT aims to secure final approval for more public-private partnership (PPP) projects, finalizing a list for consideration at the National Economic and Development Authority (NEDA) Board meeting on Monday in hopes of rolling them out within the year as planned.

Asked if the NEDA Board, chaired by President Benigno S.C. Aquino III, will meet soon, NEDA Director-General Arsenio M. Balisacan replied in a text message: “Yes, we will have it Monday next week.”

Confirming that “[t]here will be a NEDA Board meeting on Feb. 16,” NEDA Deputy Director General for Investment Planning Rolando G. Tungpalan said via separate text: “Initially, we’ll have seven PPP deals and two other government infrastructure deals up for discussion.”

The preliminary list, Mr. Tungpalan said, consists of the P378.33-billion Makati-Pasay-Taguig Mass Transit System Loop Project; P170.7-billion North-South Railway Project (South Line); P19.33-billion Motor Vehicle Inspection System (MVIS) Project; Expansion of Tarlac-Pangasinan-La Union Expressway (TPLEx) whose cost has yet to be determined; P1.16-billion Civil Registry System (CRS)-Information Technology (IT) Project Phase II; Swiss challenge of the P18-billion 8-kilometer North Luzon Expressway (NLEx)-South Luzon Expressway (SLEx) Connector Road; and the rebidding of the P35.42-billion Cavite Laguna Expressway (CALAx).

Rebidding of CALAx and of the NLEx-SLEx Connector Road was approved by the NEDA Investment Coordination Committee (ICC) Technical Board and Cabinet Committee last Dec. 22, while the five other PPP deals were approved by the same body on Jan. 14.

PPP Center Executive Director Cosette V. Canilao told reporters in December that the government targets to roll out at least nine PPP projects within the year.

Her list included most of the projects initially up for approval this Monday except TPLEx expansion, plus the P50.18-billion Regional Prison Facilities through PPP; P18.99-billion Davao Sasa Port Modernization Project; and P400-million Tanauan City Public Market Redevelopment.

The Regional Prison Facilities and Davao Sasa Port were approved by the NEDA Board in October last year.

The Tanauan City Public Market Redevelopment project was approved by the NEDA ICC Technical Board and Cabinet Committee last Dec. 22.

Poised to become the country’s first subway system, the Mass Transit System Loop will link Bonifacio Global City, the Makati central business district and the SM Mall of Asia area in a bid to ease traffic congestion in the cities of Makati, Pasay and Taguig, according to the PPP Center Web site. The planned 20-kilometer (km) subway will consist of a 16-km tunnel, a 4-km elevated railway and 11 stations.

The PPP segment of the North-South Railway Project involves a 56-km stretch between Tutuban in the City of Manila and the City of Calamba in Laguna.

Mr. Tungpalan, however, clarified that the list of projects that will be up for approval in the Feb. 16 meeting will still be finalized “within the week.” “This is just the initial one. We are still currently going through our long list to look at what may be the first batch.”

He identified the non-PPP projects that could also be approved as the second phase of the Bureau of Fire Protection Capability Building Program under the Department of Interior and Local Government and the P13.89-billion Light Rail Transit (LRT) Line 2 West Extension under the Department of Transportation and Communications. These two infrastructure deals were approved by the NEDA ICC Technical Board and Cabinet Committee on Jan. 14.

“Once these projects are approved by NEDA Board, implementing agencies can start rolling out the deals, meaning publish the invitation to bid,” Mr. Tungpalan explained.

Nine PPP deals have been awarded since the program was launched in 2010: P2.5-billion Integrated Transport System-Southwest Terminal project; P17.52-billion Mactan-Cebu International Airport Project; P64.9-billion LRT Line 1 Cavite Extension; P1.72-billion Automatic Fare Collection System; P2.01-billion Daang Hari-South Luzon Expressway Link Road; P15.52-billion Ninoy Aquino International Airport Expressway; P16.28-billion first phase of the PPP for School Infrastructure Project (PSIP); PSIP’s P3.86-billion second phase; and P5.69-billion Philippine Orthopedic Center modernization. -- Chrisee Jalyssa V. Dela Paz

source:  Businessworld

PPP proponents urged to push local fuel-efficient car designs

TO help advance the adoption of smarter mobility in the Philippines, public-private partnerships (PPPs) are encouraged to support potential fuel-efficient car designs of local talents as the country hosts again The Shell Eco-marathon Asia at the Luneta Park from February 25 to March 1.

Lyndon Lumain, general manager of such event, told the BusinessMirror on Wednesday that they hope to see alliances from the government, private and the academic sectors in the future to work together to drive innovation and efficiency into vehicle designs.

This, he said, is feasible given the creativity and innovativeness shown by Filipino student-participants in such an annual event.

The official cited, for instance, the entry from De La Salle University, which won second place in the competition’s “Battery” category last year.

“Their designs will not improve if there’s no support from the government and the private sector because developing and designing [a fuel-efficient car] is expensive. It takes financial resources,” he said.

“So we hope they could see their potential. That’s why we hold it [the 2015 Shell Eco-marathon Asia] in a public place to really show to everybody that they could really work and yet they need help.”

Since the regional eco-marathon’s first staging in the country last year, Lumain shared that locally crafted fuel engines have already gained interests from both the government and private companies.

“We don’t own the rights [to the designs of the students]. We are just the enablers. So we channel them to the schools,” he said.  Being the event’s organizer, the oil company, according to Shell Vice President for Communications Ramon del Rosario, does not actually push the participants’ engine designs to the car manufacturers as they still need improvements to apply to the actual vehicles.  He said their technical group works with the design teams of the original equipment or car manufacturers for further enhancements.

“They try and match what we have in terms of our products as against what they have in terms of technology of cars and designs,” he said. “Then the combination can give you actual savings.”

With the growing interest as shown from the increase in numbers of local teams participating in this year’s event, he said that Filipino creativity is indeed alive.

From 14 student-teams coming from nine universities in Metro Manila last year, the 30 Filipino student-teams from 24 local universities all over Luzon, Visayas and Mindanao are all set for the 2015 Shell Eco-marathon Asia.

They will compete against over 100 teams of engineering students from 17 countries across the region to battle it out their very own original eco-friendly car inventions empowered to travel the farthest distance on the least amount of fuel.

“This year, I think it will be more competitive. Some of the Philippine teams have actually prepared. We see their potential of winning,” Del Rosario said.

source:  Business Mirror

MNTC seeks to complete P18-billion connector road by 2017

THE tollways arm of conglomerate Metro Pacific Investments Corp. (MPIC) is seriously looking into completing its P18-billion connector road in two years’ time, so much so that it is already planning to raise roughly P15 billion to bankroll the capital requirements of the much-needed infrastructure project that would connect the North and South Luzon expressways.

Despite hitting legal hurdles and the uncertainty of bagging the project, Metro Pacific Tollways Corp. (MPTC) President Ramoncito S. Fernandez said his company is already preparing to finance the project, signaling the confidence of the group of businessman Manuel V. Pangilinan in winning the contract.

The infrastructure conglomerate, he said, plans to unload as much as 20 percent of its shareholding in his company. The plan, he added, involves the sale of the said shares to a strategic partner.

“We haven’t gotten a board approval for that, but there are initial talks about getting preferably a strategic partner. We are open to both foreign and local companies,” Fernandez said in a chance interview late Tuesday.

The local flagship of conglomerate First Pacific Ltd. Co. holds a 99.88-percent shareholding in MPTC, which controls the Manila North Tollways Corp. (MNTC), the builder and the operator of the decade-old thoroughfare to the north.

Rodrigo E. Franco, president and chief executive officer of MNTC, noted that the plan to raise funding for the muiltibillion-peso connector-road project will depend on whether the company wins the contract or not.

“We are still unsure. It will depend on when the government approves the connector road,” he said in a separate interview. “If we get it then, we will start raising funds.”

The P18-billion deal has been in limbo for five years now, as government officials have different ideas on how to execute the unsolicited proposal of the infrastructure conglomerate.

Transportation officials said the project could be implemented under a joint-venture agreement with state-run Philippine National Construction Corp., requiring certain amendments to the existing supplemental toll-operations agreement of the North Luzon Expressway. Contrary to that, justice executives believe that the project must undergo a competitive challenge because of its nature as an unsolicited proposal.

The project, hence, underwent several amendments and went through different approvals and objections. Now, the deal is set to be discussed in this month’s National Economic and Development Authority (Neda) Board meeting.

The connector road, or Segment 10.2, is an 8-kilometer mainline road that will run from C-3 Road in Caloocan to Polytechnic University of the Philippines in Santa Mesa, Manila. It will also have 2.6-km port area spur road that will run from C-2 Road to R10 in Tondo, Manila.

The expressway is expected to facilitate the seamless exchange of goods and services between the two ends of the country’s capital. This would aid truck operators and freight services firms to pick up shipped goods from the ports in Manila and deliver them to local markets.

source:  Business Mirror

P1.08-trillion infrastructure push to drive growth

The government is banking on the P1.08 trillion worth of infrastructure projects that were approved by the Aquino administration to boost growth this year.

In a presentation on Wednesday, Socioeconomic Planning Secretary Arsenio M. Balisacan said this covers 93 infrastructure projects, 58 of them already ongoing.

“There are good prospects this year for infrastructure development. A total of 93 projects, amounting to P1.08 trillion, or $24.31 billion, have been approved by the Neda [National Economic and Development Authority] Board under the Aquino administration—seven of which are completed projects, 58 are ongoing or under implementation, and 28 are for implementation,” Balisacan said.

The Neda chief said that the majority of the 93 projects, or around 53 projects, will be financed through official development assistance (ODA).

The majority, or 37, of these ODA-funded projects are already ongoing. The total cost of these projects amounts to P318 billion.

Seven ODA projects, worth P17.6 billion, have been completed; and nine projects, worth P47 billion, are for implementation.

Meanwhile, around 24 of the 93 infrastructure projects, worth P628 billion, will be financed through the public-private partnership (PPP) scheme.

Nine of these projects, worth P193.3 billion, are already ongoing, while the remaining 14, worth P435 billion, are for implementation.

Around 17 projects will be funded through local financing. Twelve projects, worth P44.1 billion, are already ongoing; and five are for implementation, worth P23.9 billion.

“Notably, many PPP projects are already in their rollout stage. The government has already awarded contracts for nine Neda Board-approved PPP projects. We can say that we can expect the other 14 projects to eventually reach this stage, barring any major problem in the process,” Balisacan added.

Apart from these infrastructure projects, Balisacan said other sources of economic growth this year include the recovery of the US economy; the country’s hosting of the Asia Pacific Economic Cooperation meeting in 2015; and the implementation of the Asean economic integration by year-end.

He added that other factors, such as the decline in global oil prices, the recent credit-rating upgrades received by the country, and, barring any delays, the passage of the Bangsamoro basic law, will boost economic growth this year.

These upside factors, Balisacan said, may be able to avert the negative effects of external risks, such as the normalization of the US monetary policy; the slowdown in large emerging economies, like China; the weakness in the euro area; and the recession in Japan.

Balisacan said the government is also bracing for the domestic downside risks this year, such as possible disasters, like typhoons and a prolonged El Niño; disruptions in the peace process; infrastructure delays; logistics bottlenecks; and thin power reserves.

“Our goal up to 2016 is to sustain, if not surpass, our growth performance in the past four years and achieve inclusive growth.  We are positive that we can take advantage of [these] opportunities,” Balisacan said.

Balisacan also said the government aims to grow the economy by 7 percent to 8 percent this year and in 2016.  This growth target will be sufficient in reducing unemployment to 6.6 percent by next year, from 7.1 percent in 2013, and underemployment to 17 percent next year, from 19.3 percent in 2013.

However, consistent with his earlier pronouncements, Balisacan said the country will not be able to meet its Millennium Development Goal (MDG) target of halving poverty to 16.6 percent this year.

The MDG target is based on the estimate that poverty incidence in the country was pegged at 33 percent in 1991.

The government said it will only be able to reduce income poverty by 19 percent in 2016. In 2012 the government estimated that the poverty incidence slightly declined to 25.2 percent, from 26.3 percent in 2009.

source:  Business Mirror 

Another transport terminal set for auction under PPP program

THE STAGE has been set for the auction on May 18 of a P4-billion deal to build, transfer and operate an integrated transport hub near Food Terminal, Inc. grounds in Taguig City, with the government moving it three weeks earlier than initially planned in a bid to start construction sooner.

The Department of Transportation and Communications (DoTC) last month looked to put the Integrated Transport System (ITS)-South Terminal Project under the public-private partnership (PPP) scheme on the auction block on June 1, but announced in a pre-bid conference yesterday the date has been moved to May 18.

“We’ll issue a general bid bulletin within the week -- moving the bid submission date on May 18 -- so we can speed up the procurement process and start of construction” DoTC Undersecretary for Administration and Procurement Catherine P. Gonzales said during the pre-bid conference.

The pre-bid conference was also attended by members of the department’s Special Bids and Awards Committee and representatives of all four qualified groups, namely: Ayala Land, Inc.; Datem, Inc.; Filinvest Land, Inc.; as well as MWM Terminals of Megawide Construction Corp. and WM Property Management, Inc.

The four investor groups made it to the short list of those qualified to bid for the contract, which will include the design, construction and operation for 35 years of a terminal servicing Manila-bound commuters coming from Laguna and Batangas.

During the pre-bid conference, concern over revisions in project timeline was raised by representatives of Ayala Land and Filinvest, but Ms. Gonzales assured prospective bidders that her department “will issue a general bid bulletin stating the final timeline.” Otherwise, no major concern was raised.

Ms. Gonzales said a first round of one-on-one meetings will be held Feb. 16-17, while a second pre-bid conference will be on March 11. “After that, second round of one-on-one meetings will be from March 16 to 20,” she added.

The government set a two-stage bidding process for the contract, which means qualification documents are opened separately from financial and technical proposals.

After submission of technical and financial proposals and opening of technical offers on May 18, “the department will notify within 20 calendar days from the bidding which groups have passed the technical round,” Ms. Gonzales said.

Opening of financial proposals will be within 15 days from completion of evaluation of technical offers.

“Once we announce which company has the best financial offer, we will issue the notice of award within five days from submission of post-qualification requirements,” Ms. Gonzales said.

The contract for the P2.5-billion ITS-Southwest Terminal project, involving another terminal serving commuters from the Cavite area, was awarded to MWM Terminals last month.

source:  Businessworld

ADB approves airport funding

LAPU-LAPU CITY, Cebu—The Asian Development Bank (ADB) has approved a $75 million loan to a consortium of companies that will undertake expansion of the Mactan-Cebu International Airport (MCIA), which airport officials said will be operational within the year.

MCIA general manager Nigel Villarete said the expansion project included construction of a new terminal that would accommodate more than 12.5 million passenger every year.

“The MCIA has never been tagged as among the world’s worst airports and we hope that with its expansion and renovation within this year it will be named as among the world’s best airports,” Villarete said.

The project will be undertaken by GMR Megawide Cebu Airport Corp., a joint venture of India’s GMR Infrastructure and local company Megawide Construction Corp. GMR is the fourth largest private airport operator in the world.

The consortium will operate the airport under a 25-year concession agreement. It will involve the operation of two terminals as well as the commercial outlets.

Villarete said the new airport was expected to boost passenger traffic, support inclusive growth and mark the first large-scale public-private partnership awarded by the government.

The ADB said financing for the project include a debt of P20 billion from a consortium of Philippine banks made up of BDO Unibank, Bank of Philippine Islands, Development Bank of the Philippines, Land Bank of the Philippines, Metropolitan Bank & Trust Co, and Philippine National Bank.

“ADB’s involvement demonstrates its commitment to assist the government in developing critical infrastructure, the lack of which has been hampering new investments in the country,” said Christine Uy, Investment Specialist of ADB’s Private Sector Operations Department.

“The project will increase tourism and support industry and agricultural activity, thus creating employment opportunities in the province of Cebu and its neighboring provinces,” she said.

Cebu, which one of the fastest growing regions in the Philippines, is the gateway to Visayas and Mindanao. Mactan-Cebu Airport, which opened in the 1960s, was designed to serve up to 4.5 million passengers a year, but in 2014 it served more than 7 million.

source:  Manila Standard Today

Subway project rolled out by first half of 2015 -- DoTC

THE MOST expensive public-private partnership (PPP) deal in the government pipeline is set to be rolled out within the first half of the year, once it secures final approval from President Benigno S. C. Aquino III this month, a Transportation department official said.

Transportation spokesperson Michael Arthur C. Sagcal said by phone on Friday that his department “targets to publish an invitation to bid within the first half of 2015, and award it by the first quarter of 2016.”

The P374.5-billion Makati-Pasay-Taguig Mass Transit System Loop was one of the seven infrastructure projects approved by the National Economic and Development Authority (NEDA) Investment Coordination Committee Technical Board and Cabinet Committee meeting on Jan. 14.

It will also be one of the projects that could be approved in the next NEDA Board meeting, tentatively set for early February, Rolando G. Tungpalan, deputy director-general for Investment Programming of NEDA, said by phone on Sunday.

“We’re allocating at least seven months after the rollout for the one-on-one meetings with prospective bidders, qualification of those interested, and actual bidding itself,” Mr. Sagcal said.

The spokesman of the Department of Transportation and Communications (DoTC) said that his department is “preparing for the next NEDA board meeting where we are hopeful that the project will be given the final green light for bidding.”

The planned 20-kilometer (km) system will consist of a 16-km tunnel, a 4-km elevated railway and 11 stations, which is expected to ease road congestion in the cities of Makati, Pasay and Taguig, according to the PPP Center Web site.

Veteran PPP bidders Metro Pacific Investments Corp. (MPIC) and MTD Philippines, Inc. have set their sights on the P374.5-billion PPP deal, the country’s first subway system that will link Bonifacio Global City, Makati central business district and the SM Mall of Asia.

“We are interested in the mass transit. We will wait for the terms and will look into the terms of reference,” MTD Philippines, Inc. President Isaac S. David said via mobile phone reply on Jan. 18.

For his part, MPIC President Jose Ma. K. Lim said in a text message: “We are interested and we will study it closely.”

Another transportation project requiring a major investment is the P177.22-billion North-South Railway Project (South Line), which is also set to be tackled in the next NEDA Board meeting.

The railway project -- involving 89.7 kms of track -- will connect to the state-owned Philippine National Railways system. It will have two phases, namely: the Malolos-Tutuban line which will be funded by the Japan International Cooperation Agency, and the rehabilitation of the Tutuban-Calamba line under the PPP scheme.

The second phase will involve an interchange at Tutuban station and will run southwards to Calamba. -- Chrisee Jalyssa V. Dela Paz

source:  Businessworld

JP Morgan hikes Philippine growth forecast

MANILA, Philippines - US-based JP Morgan raised its forecast for Philippine economic growth this year following the faster-than-estimated expansion in the last quarter of 2014.

“The upward revision of 2015 (estimated) GDP growth forecasts following the better-than-expected (fourth quarter 2014) GDP growth print and the material monetary policy flexibility amid easing inflation and softness in oil prices reinforce the positive macro story of the Philippines,” the financial services giant said in a research note.

JP Morgan now sees the Philippine economy expanding by 6.4 percent this year than its earlier projection of 5.4 percent.

Gross domestic product (GDP), a measure of economic output, grew by a surprising 6.9 percent in the fourth quarter last year, accelerating from the 5.3 percent seen in July to September. This brought the 2014 economic growth to 6.1 percent, still below the government’s 6.5 to 7.5 percent target and also slower than 2013’s stellar 7.2 percent growth.

“The key highlight of the GDP print was the recovery of government spending in the [fourth quarter] which assuages concerns regarding the potential pull factor from the government infrastructure spending bottlenecks,” JP Morgan said.

It noted the government last week committed to further accelerate spending, the lack of which pulled down growth in the third quarter of last year.

“We remain confident on growth over the next few quarters as consumption remains robust and the government is expected to accelerate spending ahead of the six-month moratorium on project approvals prior to the May 2016 national elections,” JP Morgan said.

The government hopes to grow the economy by seven to eight percent this year, fueled by domestic consumption and the service sector amid the run-up to the national polls in 2016.

Meanwhile, British banking giant Standard Chartered forecast growth this year at six percent, noting a faster print could materialize if the government hastens spending and more infrastructure projects are started.

“Growth is likely to be supported by the domestic and external sectors, with low oil prices providing additional upside. Our macro tracker for the Philippines shows that the economy has continued to benefit from solid external demand in recent months,” Standard Chartered said in a separate research note.

“At the same time, inflationary pressures have eased, most notably from energy. Tighter monetary conditions… should rein in inflationary pressures for now,” the bank said.

Standard Chartered stressed that the sound macroeconomic fundamentals should continue supporting the peso even with a strong US dollar.

The banking giant said it expects the peso to settle at 45 to a dollar by mid-2015 and at 43.50:$1 by the end of this year.

source:  Philippine Star

Auction process to start for ‘clean’ energy deals

THE ENERGY department plans to start later this month the open and competitive selection process (OCSP) for the 24 renewable energy resource areas that will be offered to investors, an official of the Energy department said last week.

“The target is to launch the OCSP on Feb. 23. We’re just working on some final details,” Mario C. Marasigan, director of the agency’s Renewable Energy Management Bureau, said in a text message.

The auction process was originally scheduled to be launched on Dec. 15 last year but was pushed back due to some “minor concerns.”

Mr. Marasigan said the Energy department will make bid documents available to the investors during the launch.

“Once we launch the OCSP, interested investors can start buying the documents and start preparing for their bids,” Mr. Marasigan said.

While other details are yet to be finalized, the official said bid submission deadline will be two months after the OCSP launch.

A three-month evaluation period will follow, after which the Energy department will award the contracts.

The government expressed confidence that the OCSP will yield good results. Mr. Marasigan had said in December there were local and foreign investors that had already indicated interest in the auction.

“The results of our stakeholders consultations in Davao, Cebu and Baguio were all very positive,” Mr. Marasigan had said.

“We got very positive outlook [sic] in local communities and local governments. So we believe that as long as we can do the launch, we’ll have positive results.”

Under the OCSP, the Energy department will offer four geothermal and 20 hydropower sites for development and utilization. Two of the geothermal sites to be offered are in Mindanao, while the other two are in Luzon and the Visayas. The 20 hydropower resources, meanwhile, are spread across the country.

Data from the Energy department showed that as of end-November, the government has already awarded 650 renewable energy contracts since the passage of the Renewable Energy Act of 2008. Projects with capacity totaling 2,500 megawatts (MW) are operational, while 10,040,03 MW are in various stages of development.

Besides the tender planned for renewable energy deals, the department is also in the process of auctioning off petroleum areas under the fifth leg of the Philippine Energy Contracting Round (PECR 5). Launched in May, the PECR 5 offered 26 resource areas -- 11 for petroleum and 15 for coal -- to investors.

A total of seven coal operating contracts were awarded last month.

For petroleum, deadline for service contract applications will be on June 30. Winning bidders will be endorsed to Energy Secretary Carlos Jericho L. Petilla on Sept. 4. Upon endorsement, Mr. Petilla will evaluate the applications and forward them to Malacañang. Petroleum contracts are subject to approval by the President before awarding, as required by Presidential Decree No. 87.

source:  Businessworld