MANILA, Philippines - Manuel Pangilinan's Metro Pacific Investments Corp. says government's decision to allow it and San Miguel to build two roads connecting the North Luzon and South Luzon Expressways, will result in higher tolls for road users.
MPIC chief finance officer David Nicol said the math doesn't add up.
"It doesn't double the level of traffic. Consequently someone has to make a return on this. The banks that lended money for the project have to be paid so this may raise tariffs up for users. And then there is a balancing act between what regulators can charge and what is reasonable for the riders," he said.
Instead of choosing between an unsolicited bid by MPIC and the Skyway extension proposed by the San Miguel Citra Group, President Aquino decided to let both companies build their own roads.
He even said in his State of the Nation Address this year that the roads would be done by 2015.
This isn't the only sticking point between Metro Pacific and the Aquino government.
Metro Pacific's contract to operate the Subic Clark Tarlac Expressway and its plan to take over MRT-3 both remain in limbo. The SCTEx contract remains unsigned by President Aquino even after terms were renegotiated last year and improved this year.
Nicol said what the government wants, a full guarantee for the SCTEx debt, is not realistic.
"Government took on quite a lot of debt to build this road and they would like someone to guarantee all that debt but that is quite hard for the private sector to do. So it is trying to find a compromise between a fair rate of return for the private sector partner and the debt and that is taking some time," he said.
While Metro Pacific has a stake in MRT-3 that it says gives it the right to expand and operate it, it says it will accept a government decision to take it over.
"It is best that we wait for the official advice of the DOTC. Whatever the government's decision might be on MRT3, we will respect and abide by it," Pangilinan said.
Transportation Secretary Jun Abaya this week said the government wants to "deprivatize" MRT-3 before bidding it out again.
While infrastructure is proving to be tricky, it's potentially so lucrative that companies etam up for the big ones, such as Metro Pacific and Ayala for LRT projects.
But that doesn't mean Ayala can't joke about about horning in on MPIC's other projects.
"What is not here is the NLEX-SLEX connector because Mr. David Nicol is here, but I want to surprise him by outbidding him when the time comes. We can talk after this, David," John Eric Francia, group head of corporate strategy at Ayala Corp., said.
At least MPIC hopes Ayala is just joking.