New Cebu Airport Terminal Under PPP Program
Consultants for the building of a new airport terminal at the Mactan Cebu International airport (MCIA) have recommended that the private sector jointly manage the facility under the Public-Private Partnership (PPP) program.
A promise to upgrade the international airport in Mactan, Cebu was among the things President Benigno Aquino III mentioned in his State of the Nation Address (SONA) last Monday.
If the Department of Transportation and Communications (DOTC) approves the PPP programt, the recommendation from transaction adviser Velloloite (India) will be sent to the Infrastructure Coordinating Committee (ICC) of the National Economic and Development Authority (NEDA).
Nigel Paul Villarete, general manager of the Mactan Cebu International Airport Authority (MCIAA), said they are asking that the PPP contract include a provision to absorb the existing employees for at least six months.
About 580 employees may be affected if the plan to let the private sector operate the expanded airport pushes through.
Villarete, however, said he is confident that the private firm will retain most, if not all, of the employees for three reasons.
First, airport operations require highly specialized skills that are not in abundant supply.
Second, the airport is operating with a lean staff.
In 2000, there were more than 600 employees to serve two million passengers. Right now, they are down to 580 to serve 6.2 million passengers as of 2011.
Third, the private sector is going to need more people for the new terminal.
The expansion of MCIAA is one of the major PPP projects President Aquino mentioned in his third SONA.
”Before the end of my term, the New Bohol Airport in Panglao, New Legazpi Airport in Daraga, and Laguindingan Airport in Misamis Oriental will have been built,” the President said.
”We will also upgrade out international airports in Mactan, Cebu; Tacloban; and Puerto Princesa Airport, so they can receive more passengers; in addition to the airports in Butuan, Cotabato, Dipolog, Pagadian, Tawi-Tawi, Southern Leyte, and San Vicente in Palawan,” he also said.
Villarete said he has a scheduled meeting with DOTC officials headed by Secretary Mar Roxas on Friday to further discuss the Mactan airport project.
The transaction adviser for the construction of the new terminal, Velloloite (India), has also recommended that the operational and management structure of the entire airport be included in the PPP.
Villarete recalled the feasibility study for the new passenger terminal building, prepared by the Korean International Cooperation Agency, was submitted to the DOTC last November 2011, for inclusion in the PPP.
It was DOTC that requested the Neda PPP Center to engage the consultant’s services, and Velloloite has completed the draft business case and PPP structure.
It recommended changing the project terms for the construction of the new terminal, from build-operate-transfer (BOT) to include operation and management of the entire airport.
But Villarete said the draft business case needs to be approved by the DOTC, then NEDA-ICC. The target is to submit this to NEDA by the first week of August.
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