FINANCE Secretary Carlos G. Dominguez III said he is open to selling Ninoy Aquino International Airport (NAIA) to raise the much-needed revenues to help pay for debts the government incurred after it imposed lockdown measures against Covid-19.
While the privatization of government assets was not listed in the Department of Finance’s (DOF) proposed fiscal consolidation and resource mobilization plan for the incoming administration, Dominguez said selling NAIA is possible but they have to ensure first the development of alternative international airports.
“That [selling NAIA] is a definite possibility. Actually we have thought about that since 2016? But we have to see first how the development of the alternative to NAIA,” he told reporters during a news briefing.
House Ways and Means Committee Chair Albay Rep. Joey Salceda earlier urged the next administration to privatize NAIA and some parts of Manila Bay as a means to raise P500 billion to pay for its debts.
Last Wednesday, the DOF unveiled its proposed fiscal consolidation plan, which contains a set of measures aimed to generate an annual average of nearly P350 billion per year from 2023 to 2027 to help the country outgrow its debt at a faster rate. The plan included the following: imposition of several taxes; 3-year deferment of the second tranche of reduction of personal income tax rate from 2023 until 2025; the expansion of value-added tax base; removal of VAT exemptions except for some sectors; and, possible VAT-rate reduction among others.
According to the Bureau of the Treasury, the government needs at least P249 billion in incremental revenues every year to wean the bureaucracy from more borrowing to pay for a debt bill that has hit P3.2 trillion.
As of end-March, the national government is staring at a record-high debt of P12.68 trillion as it resorted to more borrowings amid weak revenue collections and increased spending. The national government’s debt-to-GDP ratio has also risen to a 17-year-high at 63.5 percent, above the internationally recommended 60-percent threshold by multilateral lenders for emerging markets like the Philippines. This is also the highest since the country’s debt-to-GDP ratio hit 65.7 percent in 2005 under the Arroyo administration.
To recall, the government in December 2020 revoked—for reasons officials have yet to say—the original proponent status (OPS) granted to Megawide Construction Corp. and its partner GMR Infrastructure Ltd. for their P109-billion proposal to redevelop the NAIA.
It was in July 2020 when the Manila International Airport Authority issued the OPS to Megawide. This came a few weeks after the NAIA Consortium—a group of conglomerates that proposed to redevelop the airport—backed out of the project.