QUEZON CITY (PIA)—Department of Finance Secretary Ralph Recto has announced the successful remittance of a P30 billion upfront payment from the San Miguel Corporation-led New NAIA Infra Corp. (NNIC) for the Ninoy Aquino International Airport (NAIA) Public-Private Partnership (PPP) project.
The finance chief noted that this payment is expected to significantly enhance the government’s non-tax revenue stream and help alleviate the need for new taxes.
With an estimated project cost of P170.6 billion, the rehabilitation of NAIA is described as the largest PPP initiative under President Ferdinand R. Marcos, Jr. The project aims to tackle long-standing undercapacity, congestion, and underinvestment issues at the country’s main airport.
“We are hitting two birds with one stone on this project. This will transform NAIA into a world-class airport and guarantee the government a healthy income stream from the private sector operator,” Recto said.
The P30 billion that NNIC remitted represents only the initial payment, with projections indicating that the government could generate approximately P900 billion over the 15-year concession period, which can be extended by an additional period of 10 years. This translates to an estimated annual revenue of P36 billion, earmarked for the government’s education, public health, and infrastructure projects.
The Manila International Airport Authority (MIAA) processed the remittance and was cleared by the Bureau of the Treasury (BTr) on September 16, 2024, following the official turnover of NAIA’s operations and maintenance to NNIC on September 14, 2024.
The Department of Transportation (DOTr) and the MIAA are the co-grantors of this solicited PPP, which is expected to boost airport capacity from 35 million to 62 million passengers annually and increase air traffic movements from 40 to 48 per hour. The rehabilitation will also incorporate internationally benchmarked Minimum Performance Standards and Specifications, leveraging private sector expertise for modernization.
The NAIA project received approval from the NEDA Board, chaired by President Marcos, on July 19, 2023, after being evaluated in a record-breaking period of six weeks—the fastest approval for a PPP proposal in Philippine history.
On February 16, 2024, the MIAA board awarded the contract to the SMC-led consortium, which submitted the highest bid parameter. The consortium has committed to a P30 billion upfront payment, a fixed P2 billion annual fee, and an 82.16 percent revenue share for the national government, excluding passenger service charges. The concession agreement was signed on March 18, 2024.
This landmark project reflects the government’s commitment to improving infrastructure and public services, promising a brighter future for both travelers and the economy. (JEG/PIA-NCR)
