MANILA, Philippines - Policy directions on infrastructure projects must be cleared first before investments can pick up steam, according to the National Economic and Development Authority (Neda).
Neda Infrastructure staff director Erick Planta said there were several policy issues on large urban infrastructure projects such as the location of the new Manila airport and the tussle on the common station project that would link the Light Rail Transit (LRT) and Metro Rail Transit (MRT).
He said the Neda Infrastructure Committee is expected to convene on Aug. 5 and could hopefully give a clearer direction of the infrastructure development strategy of the Duterte administration.
“In the infracom, what we will raise are policy issues that were unresolved or those needing closure. As we start a new administration, everybody’s reconfirming the priorities of projects that are caught in between.”
The Neda infracom is composed of the director general of the Neda as chairman, the secretary of public works and highways as co-chairman, and the executive secretary and the secretaries of transportation and communications, finance and budget and management, as members.
The committee advises the president and the Neda board on infrastructure development strategy for highways, airports, seaports, railways; power generation, telecommunications, irrigation, flood control and drainage, water supply and sanitation; national buildings for government offices; hospitals and related buildings; and state colleges and universities, elementary and secondary school buildings.
Another project that went back to the approval process is the P170.7 billion North-South Railway Project which would run from Manila to Legaspi City, Albay.
The submission of prequalification documents was originally set in April but was postponed after the Department of Transportation and Communications (DOTC) proposed to bid out the two lines of the train system separately as opposed to the original NEDA board approval of bundling the lines in one deal.
Planta said greater policy direction is also needed for new pronouncements on pursuing infrastructure projects under the public-private partnership (PPP) scheme.
Among these include Finance Secretary Carlos Dominguez’s proposal to encourage the use of the PPP scheme for smaller projects at the local government unit level and Budget Secretary Benjamin Diokno’s plan to pursue hybrid PPP deals in which only the management of government projects would be bid out.
If more PPP deals at the LGU level would be pursued, now would be an opportune time to do so because LGU leaders are also starting fresh terms, Planta said.
“We are supportive PPPs in the LGUs. Now is the time to think about it because we are at the early stage of a new government. It makes sense but operationally, that process is just starting,” he said.
Planta expects to get a glimpse of the new administration’s policy direction on infrastructure when President Duterte delivers his first State of the Nation Address (SONA) today.
The government is determined to complete by 2017 the procurement of around 17 stalled PPP projects collectively valued at $580 billion. Many of these projects still lack the requisite approval of NEDA while some that that have made it to the auction stage were snubbed by bidders and sent back to the drawing board. These comprise airports, seaports, dams and dikes among others.
The Asian Development Bank estimates that between 2010 and 2020, the Philippines needs to invest $127 billion in infrastructure to stave off an infrastructure crisis owing to rising incomes and a growing population.
The Duterte administration— which has signified early on that it would build on the gains of the previous administration— promises to pick up the pace of the PPP program by streamlining the approvals process and opening its doors to more unsolicited proposals under the PPP scheme, therefore maximizing the expertise of the private sector and freeing up government funds for other use.