Why SMC refuses to submit formal proposal for $10-B airport


Posted at Jul 10 2014 08:34 PM | Updated as of Jul 11 2014 04:34 AM

Sangley eyed as site for new airport

MANILA - The Philippines is looking at using a former U.S. navy base as an alternative to Manila's dilapidated main international airport after San Miguel Corp. refused to submit a formal proposal for a $10-billion gateway it had planned to build.

San Miguel submitted a "list of suggestions but not an unsolicited proposal" which is required under the law for private sector-initiated projects, Transportation Assistant Secretary Jaime Raphael Feliciano told Reuters on Wednesday.

This was confirmed by San Miguel President Ramon Ang late on Wednesday. "We don't want to, because that's unfair (to other prospective bidders)," he said, when asked if the company had submitted an unsolicited proposal.

Instead of asking San Miguel to submit an "unsolicited" proposal, the government should hold a public bidding to be fair to other investors who may also be interested in undertaking the project, Ang said.

The transportation department has repeatedly asked San Miguel, the most diversified Philippine conglomerate, to submit an "unsolicited" proposal for its planned airport, which would be subject to state scrutiny and open to competition.

In March, San Miguel had presented plans to build a new $10-billion international airport in Manila, including four runways and an elevated toll road to connect the airport to the
Makati financial district, as well as reclaiming more land.

San Miguel later said it was willing to take on other top conglomerates as partners, like SM Investments Corp. and Ayala Corp.

Feliciano said in the absence of a formal proposal from San Miguel, the government had asked the Japan International Cooperation Agency (JICA) to conduct a full-fledged study into the feasibility of converting a former U.S. navy base at Sangley Point in southwestern Cavite province into an alternative to the congested and ageing Ninoy Aquino International Airport.

"JICA has proposed...Sangley as the location for the new primary gateway after considering other options which it found less ideal," Feliciano said in an e-mail response to Reuters.

"To determine, however, the viability of this project, a full feasibility study must be conducted."

A full feasibility study on an airport at Sangley will include a review of financing options, including public-private partnership scheme, inexpensive development assistance loans or the state budget, Feliciano added.

An airport at Sangley formed part of a slew of infrastructure projects proposed by JICA to the Philippine government.