By Antonio Colina IV
DAVAO CITY – After being awarded the right to become the country’s third major telecommunications player through his Mislatel partnership with China Telecom, Davao tycoon Dennis Uy, through his Udenna Corporation, has also gained the upper hand to undertake the P30-billion, 34.9-kilometer intra-city urban rail system project.
According to Davao City Planning and Development Office (CPDO) head Ivan Cortez, Udenna has scheduled a presentation before the City Development Council this month.
Cortez said Uy’s company submitted an unsolicited proposal in December 2017, but the city government told the company to send its proposal directly to Department of Transportation (DOTr) as the agency was responsible for overseeing the “implementation of the rail system in the country.”
After it satisfies all the requirements set by the government, he said the National Economic Development Authority (NEDA) will subject the rail project to a Swiss Challenge that would allow other interested parties to enter their bids and proposals for the project.
But since Udenna has already been granted an Original Proponent Status (OPS), Cortez said the Uy company has already gained the “upper hand” in the Swiss challenge because it will have the advantage of having “the right to match the best offer that might come out during the bidding.”
“The most crucial of the documentary requirement is the financial viability and capacity of the proponent to undertake the project. That will be reevaluated and assessed by the NEDA-ICC,” he said.
Cortez said any rail system in the country is considered a “national project” and, as such, the city government will not be able to provide Udenna any counterpart financial support because it is an unsolicited project.
As per the Public-Private Partnership Ordinance of this city, unsolicited projects should be undertaken at no cost to the local government.
Udenna was granted the OPS because it was the only one that complied with the documentary requirements when it forwarded its proposal to undertake the project, according to Cortez.
An Korean engineering company submitted its unsolicited proposal in 2015, while Philtram/Maglev Vision Corp. in partnership with state-run China Railway Engineering Consulting Group Inc. in January 2017.
But the two firms may still join the bidding, he said.
Any project can be considered unsolicited when it’s not listed as one of the projects to be implemented by the city, introduces new technology, and requires no financial support from the city in the implementation of the project, Cortez added.
“In their second presentation to the Transport and Traffic Group, they already were harping on getting a guarantee from the (city) government. That’s why, we already recommended them to go directly to the national government because the city government cannot provide them the guarantee that they are asking for. It’s a guarantee that can only be provided for by the national government,” he said.
According to Cortez, the DOTr responded favorably to the company’s proposal and granted them the OPS.
“Just like other rail systems from the other parts of the world, there really is a need for government to also chip in in terms of operation or in terms of capex (capital expenditure) simply because as of now all operations of the railway system in the world is subsidized largely by the government,” he said.