BEFORE serious infrastructure projects can be implemented, a rigorous feasibility study needs to be undertaken to ensure its viability. It was disappointing to hear last Thursday that Vivencio Dizon, presidential adviser for flagship programs said that eight projects worth a total of P370 billion had been stricken out of the ‘Build, Build, Build’ list. These included the Guimaras-Negros portion of the Panay-Guimaras-Negros Bridge. The feasibility study was reportedly initiated some time ago. Are there any interim results available for public consumption?
Intuitively, I would have though that the full project, particularly if tolls were involved, would be highly viable.
This brings us to the question of the efficacy of government bureaucrats when it comes to decision-making in infrastructure projects.
Recently, Globe CEO Ernest Cu mentioned inordinate delays in obtaining permission to erect cell towers needed to develop Globe’s telecommunications infrastructure. His observations elicited an empathetic response from president Duterte. We would like to see government officials occupy a role which facilitates, rather than hinders, speedy implementation.
In 2010, the Aquino administration created a public private partnership (PPP) scheme whose aim was to develop infrastructure.
Dizon has reported that there are 29 PPPs that are ‘shovel-ready’ (presumably this means that there are now no more public sector administrative hurdles to be cleared). But have both the public and the private sector agreed that these projects are all viable? The PPP scheme has not been an overwhelming success, partly because the public sector has specified onerous conditions which the private sector is not able to accept.
For example, it is now several years since a PPP project was conceived which involved an additional P20.26 billion to be invested in Bacolod-Silay airport. What the airport needs is a longer runway. Then, in a post-pandemic age we would be able to accommodate non-stop flights from accessible places such as Seoul, Vladivostok, Beijing etc. The tourist potential is enormous, particularly in the Korean, Russian, and Chinese winters. It does not cost P20 billion to extend the runway. A viable project could be implemented for around P5 billion. The airport does not need an additional P15 billion for glossy lounges, shops, restaurants etc. The private sector knows this but the public sector, seemingly, does not.
I sense that the public sector does not fully understand how difficult it is for the private sector to obtain reasonable returns on its front-loaded investments.
How many of the 29 PPPs mentioned by Dizon have been accepted by the private sector? I sense that government officials see themselves in the driving seat when dealing with the private sector, and that the latter are perceived to be mere supplicants.
We need realistic discussions and negotiations./PN
