Race to NAIA

NAIA, we love it or we hate it. We love it for those times we had a pleasant experience – smooth, seamless and sane, but we hate it for all the times it failed us or nearly failed us – traffic, delayed flights, immigration horrors, etc.

Yet, for now, the Ninoy Aquino International Airport is the only main gateway we have as newer alternatives have yet to rise from bodies of water.

The good news is that the race to develop NAIA is on again under the Marcos administration. In fact, foreign airport operators, now allowed by the Public Service Act to control 100 percent of a Philippine airport’s operations, have joined the fray.

Foreign companies interested include Surbana Jurong Group, Parisian airports operator Groupe ADP, Turkey airport operator TAV and the consortium behind London Gatwick Airport, the gateway which unfortunately was hailed as among Europe’s worst airports in 2017 and more recently in May 2023, according to several online websites including Simpleflying.com.

Locally, the interest is strong as well. The super consortium of some of the country’s biggest and most competent conglomerates is trying its luck again, albeit one member less and more importantly, with some changes in its offer, now a P100-billion proposal for 25 years, compared to their earlier offer of P350 billion for 35 years.

Solicited vs. unsolicited

Against this backdrop, the Department of Transportation (DOTr) led by Transportation Secretary Jimmy Bautista made it clear early on that it prefers to pursue the upgrading of the airport through solicited bidding.

The DOTr tapped the Asian Development Bank to structure the terms for the solicited bidding route, not only for the airport but for other infrastructure projects.

Thus, it came as a surprise that the super consortium or the Manila International Airport Consortium decided to submit an unsolicited offer. In any case, the DOTr is looking into this offer as well.

For the DOTr, solicited bids are more competitive as it increases the likelihood of receiving the best deal for the government. It’s more transparent, too.

Furthermore, there is a level playing field as all competing entities are given the same opportunity, eliminating biases since terms and conditions are laid out and it applies to everyone.

On the other hand, unsolicited proposals – though very much allowed – may be less competitive since other private entities may not decide to join, knowing that their chances are slim.

And while the Swiss Challenge is an available avenue, in reality, the Original Proponent’s right-to-match effectively eliminates this.

But in some cases, the solicited process may take time, whereas the unsolicited route may advance faster. However, for the NAIA project, it seems DOTr and ADB are already in the advanced stages of the feasibility study and they have already been in talks with the National Economic and Development Authority (NEDA).

Now should the DOTr decide to do the unsolicited route, it must make sure there are no pending unsolicited proposals presented to past administrations to avoid possible legal challenges that could further delay the project. We’ve seen how legal hurdles have delayed moves to rehabilitate NAIA in the past.

What happens next is anybody’s guess. If it were up to me, solicited or not, I’d like to see a Filipino-owned company run our main gateway.

To date, there are at least three Filipino-owned companies with experience in running major airports. There’s Ed Saavedra’s Megawide for Mactan Cebu International Airport (MCIA); Aboitiz InfraCapital – led by infra veteran Cosette Canilao – after buying into MCIA and San Miguel Corp. of tycoon Ramon Ang for Caticlan Airport in Boracay.

Some foreign operators are good, too, although others are not necessarily better.

Actually, it can even be the Manila International Airport Authority (MIAA) if only it has the financial leeway and the speed to procure supplies just like a private corporation and not hindered by the Jurassic-era PhilGeps procurement system. Do you know how long it takes for a government agency to procure a single item, even just a ream of bond paper?

For 2023, in fact, MIAA only got a budget of P43 million, which is even less than the P49-million budget for the Department of Tourism’s “Love the Philippines” tourism campaign, which turned out to be anything but lovable –but that’s another story.

But despite its low budget, I’ve personally experienced significant improvements in NAIA under Bautista’s team, except for the blackouts which aren’t really MIAA’s fault.

But whether it’s Filipino or foreign, the process must be credible, transparent and competitive. As I said, solicited proposals can be better than the unsolicited route as the latter may be prone to politics, skewed negotiations, etc.

Build better more

It’s now up to Sec. Jimmy and the DOTr, the heralds of this administration’s Build Better More infrastructure program, to make sure that the NAIA privatization would work out this time. A credible and transparent process would encourage local and international investors to aid in the infrastructure build-up.

At the end of the day, as I always say, we deserve a world-class airport.

We want visitors to love the Philippines – that love-at-first-sight bedazzling kind of love – but if they have an unpleasant experience in our airport as soon as they land, sparks will immediately fly out the window. Worse, that love may turn to loathe before it can even begin and we may end up having a harem of scorned lovers instead.

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Email: [email protected]. Follow her on Twitter @eyesgonzales. Column archives at EyesWideOpen on FB.