DOTr opens doors to 25-year concession for NAIA privatization

MANILA, Philippines — The Department of Transportation (DOTr) may provide the future operator of the Ninoy Aquino International Airport (NAIA) with an option to extend its concession period to 25 years.

In an interview with reporters, Transportation Undersecretary Roberto Lim said the government is standing by its decision to lock the concession period for NAIA privatization at 15 years, even as the Manila International Airport Consortium (MIAC) is pushing for a 25-year concession period.

“At this point, we believe that (15 years) is the better option. Likewise, we have incorporated in our proposal an option to extend it by another 10 years in the event that circumstances warrant,” Lim said.

In particular, Lim said the extension grants the NAIA operator the opportunity to complete all of the projects covered in the agreement. Similarly, it ensures that the airport will be expanded to a capacity that can serve the future demand of passengers.

Lim said the DOTr would try to maintain the concession period at 15 years in support of the plan to host multiple airports around Metro Manila.

Down the line, the DOTr envisions a National Capital Region where passengers get a total of four gateways to choose from in flying in and out the Philippines: NAIA, Clark International Airport, New Manila International Airport and Sangley Point International Airport.

“In the DOTr, we believe 15 years is the more appropriate term because it gives us flexibility. We have to consider that our strategy in the DOTr is to have multiple airports in the Greater Capital Region. We envisage that over time, with the forecast demand, you will have NAIA as one airport and have two other airports,” Lim said.

MIAC, composed of six conglomerates and a foreign partner, plans to invest around P267 billion to rehabilitate and upgrade NAIA. MIAC wants to bag a 25-year contract for its proposal.

Lim said the DOTr and MIAC are scheduled to meet this week to clarify some provisions in the unsolicited proposal submitted by the group. They will discuss, among others, who will pay real property taxes should MIAC win the contract to operate and maintain NAIA.