The construction sector is deemed to be the prime mover of the domestic economy. It’s contribution to the economy is immeasurable. Spirited activities in construction spawn other economic activities from job creation to manufacturing – cement, steel, the bolts and nails. It’s encompassing!
Clearly, there has been a significant slowdown in this sector because of the pandemic, shared Junjun Abcede, the president of the Construction Projects Management Association of the Philippines. There has been a sprinkling of activities but understandably not in a massive way as before.
One major development project that has been severely impacted is the Sangley Point International Airport (SPIA). After almost 20 months something is going on.
The movement came in the form of an unsolicited proposal from the SPIA Development Consortium to form a joint venture with the Province of Cavite to transform Sangley airport as an alternative international gateway.
The consortium is composed of both top notch domestic and foreign companies backed with track records in developing, investing and managing large scale, high-value infrastructure projects including international airports.
Despite it’s inability to sign the joint venture (JV) undertaking for the development of Sangley airport, the interest of MacroAsia, owned by tycoon Lucio Tan, has not waned. Blame it on the pandemic.
Just to backtrack a bit, in February 2020 a month prior the declaration of the pandemic, the local government unit of Cavite entered into a JV agreement with the consortium of MacroAsia and China Communications Construction Corp. to develop SPIA. The JV would have been signed between the contracting parties in August 2020 but pandemic happened and all things broke loose. And the one-year prescription time lapsed. In October, the Cavite government conducted another bidding but it was deemed a failure. Thus, the unsolicited proposal.
MacroAsia has joined forces with other topnotch domestic and foreign companies to form the SPIA Consortium. MacroAsia will provide management and technical services for the aviation support and logistics component of the project. It will be a non-equity member of the consortium.
On the foreign side, there’s Samsung C&T Corporation of South Korea that built the extension of the Changi International Airport and the world’s tallest, the 828-meter Burj Khalifa in Dubai. Munich Airport International GmbH, the management services arm of Munich Airport, Europe’s only 5-Star rated airport and certified best airport for the past 14 years. And, London-based Arup Group.
Other local members include Cavitex Holdings, Inc. of Manny V. Pangilinan, which was responsible for the development, design and construction of the Manila-Cavite Expressway (Cavitex) project, a 14-kilometer-long controlled-access toll expressway linking Manila to Cavite Province.
And surprise of surprises, the Yuchengco Group of Companies (YGC), a major Philippine conglomerate engaged in construction, infrastructure development, banking, insurance, and automotive services, among others, is listed as member of the consortium.
With YGC participation, this simply means that financing of the project is assured. This, as the first phase of the development earlier pegged at $5 billion has, been scaled down to half, taking into consideration the architectural design.
Despite its notable membership, the consortium will still have to face the Swiss Challenge as required under the build-operate-transfer (BOT) law and its variant. This Swiss Challenge method has to be followed for projects procured by the government, in this case, the Cavite LGU, from the private proponents through unsolicited proposals.
Despite this hurdle, it is noteworthy to know that activities in the construction sector as massive as this is moving. All things considered, the consortium is in full throttle, ready to commence full project development activities as soon as the project award is granted.
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