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Finance Secretary Ralph Recto welcomed the P30-billion upfront payment from San Miguel Corp-led New NAIA Infra Corp
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The remittance was for the Ninoy Aquino International Airport Public Private Partnership project
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As the project finally takes off, the government is expected to generate roughly P900 billion in revenues from the deal over the entire term, of 15 years
Finance Secretary Ralph Recto welcomed the P30-billion upfront payment from San Miguel Corp-led New NAIA Infra Corp (NNIC) for the Ninoy Aquino International Airport (NAIA) Public Private Partnership (PPP) project.
Recto said the remittance will boost the government’s non-tax revenue stream without the need to impose new taxes.
“We are hitting two birds with one stone on this project. This will not only transform NAIA into a world-class airport but also guarantee the government a healthy income stream from the private sector operator,” Recto said in a statement.
“The 30 billion pesos is just the upfront payment from the private sector partner. As the project finally takes off, the government is expected to generate roughly 900 billion pesos in revenues from this deal over the entire term, which is a 15-year concession period, extendable for another 10 years.
“This will be equivalent to a revenue source of more or less P36 billion annually for fund more projects in education, public health, and infrastructure,” the finance chief said.
With an estimated project cost of P170.6 billion, the proposal to rehabilitate NAIA is the largest PPP project of the Marcos administration. The project aims to address the longstanding challenges of undercapacity, congestion, and underinvestment in NAIA.
The National Economic and Development Authority Board approved the project on July 19 last year, then evaluated it within six weeks. This made the project the fastest approved PPP proposal in Philippine history.
The Manila International Airport Authority (MIAA) Board awarded the contract to the SMC-led consortium on Feb. 16, last year.
The MIAA remitted the first payment to the Bureau of Treasury on September 16, after the official turnover of the NAIA’s operations and maintenance to NNIC on September 14.
READ: NAIA turned over to private operator
The rehabilitation of the country’s premier airport is expected to increase capacity from 35 million passengers yearly to 62 million, and expand air traffic movements per hour from 40 to 48.
Service is expected to improve by applying globally benchmarked Minimum Performance Standards and Specifications, utilizing private sector expertise for modernization and capacity expansion.
