Gridlock over the NAIA deal
EYES WIDE OPEN - Iris Gonzales (The Philippine Star) - July 16, 2020 - 12:00am

It was like a scene straight out of a spy movie or a Mission: Impossible of sorts, but without Ethan and his death-defying stunts.

But it was just as tense, with every second a cloak-and-dagger operation, at least that one day in February two years ago.

The scene that morning began on the helipad of taipan Lucio Tan’s building in Makati where a sleek, shiny white chopper with red and light blue stripes and its flight crew were roaring to life and ready to fly.

The whole operation was set up by seven of the country’s biggest conglomerates – the Aboitiz Group, Ayala Corp., Andrew Tan’s Alliance Global Group, the Gotianun family’s Filinvest, the Gokongweis’ JG Summit, Pangilinan-led Metro Pacific Investments Corp. and the Lucio Tan Group’s Asia’s Emerging Dragon.

Their team would deliver their proposal for the redevelopment and rehabilitation of the Ninoy Aquino International Airport (NAIA) – pages and pages of documents – to the office of Transportation Secretary Arthur Tugade in faraway Clark in Mabalacat, Pampanga.

Why the rush? Because they had to be first — first on record, first on the time stamp and first in real life.

Up in the air, the team carefully looked out for other choppers which may try to beat them in the race. They watched with bated breath and fingers crossed. Luckily there was none.

Thus, it came to be. One fine Monday of August 2018, the government granted the consortium the original proponent status. The tycoons heaved a big sigh of relief. They were eager to start.

But unlike in the movies, real life does not always have happy endings, not even if you’re the country’s most powerful tycoon multiplied seven times.

After all the trouble they went through, the NAIA Consortium finally threw in the towel.

Why did the consortium give up?

After two years of negotiations, the government and the consortium decided to call it quits. Both parties were asking for a better deal and neither one would budge.

And then there was COVID-19 or the coronavirus disease 2019. With the pandemic drastically affecting global travel, the project’s viability practically went down the drain.

“Banks won’t lend now,” said a source.

The consortium was looking for some form of guarantee to help it get bank financing for the project.

“Unfortunately, the government indicated that it is not willing to accept most of the consortium’s proposed options and the consortium can only move forward with the NAIA project under the options it has proposed,” the source said.

Another problem was the issue on real property taxes. The national government wanted the real property taxes to be a separate issue, so if the Pasay and Parañaque governments jacked up their tax rates, the consortium would have had bear it.

But the consortium wanted all taxes to be treated as one account. No way, said the government.

And so the dream proposal vanished in Manila’s empty skies.

It would have expanded the existing terminals, enhanced passenger experience, and elevated the status of NAIA as the country’s premier international gateway.

The group offered to invest P102 billion for a 15-year concession period.

Internal problems

But these weren’t the only problems. The NAIA Consortium was not without internal issues.

For one, Lucio Tan-owned MacroAsia, headed by the taipan’s son-in-law Joseph Chua, joined the competitor, the Sangley Airport Project, even if the Tan Group was already part of the NAIA Consortium.

This move by MacroAsia did not sit well with some members of the consortium.

Of course, there’s the issue on the Clark Airport template, which the group deemed as risky, but which the government wanted the consortium to follow.

The contentious issue in the Clark contract was the condition that would trigger compensation for the private concessionaire, otherwise known as a material adverse government action (Maga).

Specifically in the Clark Airport project, the Maga will cover only executive orders and not the impact of any change in future laws.

However, for the private sector, especially those in the infrastructure business, this was deemed a major risk.

Megawide is back

With the NAIA Consortium out of the picture – at least under this administration – the bold boys of Megawide are back in the game.

Megawide, which operates the multi-awarded Mactan-Cebu Airport, wants to revive its plans to vie for the NAIA redevelopment project, according to my sources.

Who wouldn’t want to get NAIA? It is the country’s main international gateway after all.

But if Megawide is serious in its plan, it should strive to bag the deal under this administration.

If it doesn’t, members of the NAIA Consortium may regroup under the next administration and decide to give the airport project another try.

World-class gateway

Whichever group ends up redeveloping NAIA, I hope the real winners will be the Filipino people.

We’ve long endured the use of an airport that has already deteriorated through the years and had been filled to the brim many times.

There were days when it seemed like we just passed through the gates of hell.

But it shouldn’t be this way. Filipinos — and our guests — deserve a world-class airport. It is after all the last thing we see before we fly out and when we fly in, it’s the first thing that tells us that we’re finally home.

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