A MEMBER of the House Committee on Economic Affairs on Monday said the Department of Finance (DOF) and the National Economic and Development Authority (Neda) have formally rejected the unsolicited proposal of Megawide Construction Corporation (MCC) to expand and operate the Ninoy Aquino International Airport (Naia), but the noted builder said it has complied with the equity requirement that the two agencies had used as basis for rejection.
Puwersa ng Bayaning Atleta (PBA) Party-list Rep. Jericho Nograles said the DOF-Neda decision affirms the position of lawmakers that the Department of Transportation (DoTr) erred in endorsing Megawide’s unsolicited proposal to expand Naia in exchange for a 25-year contract to manage and operate the country’s biggest and busiest airport.
“The DoTr has no other recourse but to finally listen to the Neda and DOF as project evaluators. DoTr must reject the unsolicited proposal. Should the DoTr continue to entertain this unsolicited proposal, then it is clear that the agency is favoring a private contractor for a contract that may be disadvantageous to government.
This is a crime under section 3 of Republic Act 3019 or the Anti-Graft and Corrupt Practices Act,” Nograles said in a statement.
In a three-page memorandum dated November 19 to Transportation Secretary Arthur Tugade that was copy-furnished to Nograles’s office, the DOF and Neda declared that MCC’s equity position is insufficient to finance the equity requirement for the proposed expansion project. The memo was signed by Finance Secretary Carlos Dominguez and Neda Acting Secretary Karl Kendrick Chua.
The DOF and the Neda are the main regulators that check and approve all Public-Private Partnership (PPP) and Build-Operate-Transfer (BOT) projects.
“We are returning the submitted unsolicited proposals and project documents in view of the findings of the ICC [Investment Coordination Committee] Secretariat’s evaluation that MCC’s equity position is insufficient to finance the equity requirement for the proposed project,” said the memo.
Megawide claims it complied
Megawide, however, said on Monday it has complied with the additional financial requirements for its unsolicited proposal on Naia.
Louie B. Ferrer, the company’s managing director for transport, said the documents were forwarded to the Manila International Airport Authority (Miaa). They include the joint solidary liability, which the Neda requires.
“The financial documents we submitted are sufficient to exclusively support the requirements of the Naia project. With this, we are hopeful our proposal to rehabilitate and transform Naia into a first-world airport complex can now be elevated to the Cabinet committee for approval and proceed to Swiss challenge,” Ferrer said.
The Neda Investment Coordination Committee had sought to clarify the group’s financial capacity to fund the multibillion-peso project. This caused several groups and individuals to cast doubt on the unsolicited proposal, raising other issues such as the employment of current Naia staff.
“Infrastructure investment is critical for our country to build back from the economic crisis caused by the Covid-19 pandemic. We at Megawide are ready to do our part by providing employment and enhancing the Philippines’ competitiveness in infrastructure, especially airports,” Ferrer said.
Megawide has partnered with Indian infrastructure firm GMR Infrastructures Ltd. to meet the financial requirement for the P109-billion unsolicited proposal.
The Filipino engineering and construction firm will hold a controlling 60-percent interest in the partnership, and GMR, 40 percent. “Our partnership with GMR is strong. Together, we delivered the transformation of Mactan-Cebu International Airport and the construction of Clark International Airport. Now, we are hugely excited to deliver a first-world Naia that uplifts the travel experience for all Filipinos and provides a critical assist to the national government’s efforts to rebuild after the pandemic,” said Edgar Saavedra, Megawide Chairman and CEO.
Megawide has proposed to implement the project between seven to five years in three phases. Megawide’s proposal replaced Naia Consortium’s unsolicited proposal, after the latter withdrew its offer due to the economic viability of the project. Megawide received the original proponent status for the project in July.