Exciting things are happening
(Sixth of a series)
BAGUIO City became much closer to Metro Manila residents, who trooped to the summer capital every year to escape the metropolis’ heat and enjoy the cool climate amid the pine forests, when the Tarlac-Pangasinan-La Union Expressway (TPLEX) opened in 2013. Instead of seven hours, travel to Baguio has been cut to as short as four hours, which makes it not just a summer vacation destination, but even a weekend hotspot.
Last July 21, the Muntinlupa-Cavite Expressway (MCX) opened for service. The four-kilometer MCX links the South Expressway with Cavite, Las Piñas, and Muntinlupa.
Aside from speeding up travel to the south of Metro Manila, the MCX will also accelerate the development of commercial and residential communities on its path, including what may be a new millionaires’ row on Daang Hari.
Big players in the real estate industry have already initiated projects in the area. Vista Land & Lifescapes, which has a direct access to the MCX, is pursuing a huge mixed-use project that will include office towers, shopping and entertainment centers, schools, hospitals, and residential communities.
It’s important to note that the MCX was the first project awarded by the government under the Public-Private Partnership (PPP) program, which was launched in 2010. These projects illustrate the wide and long-lasting impact of large infrastructure projects on the economy and the people.
It is also important to note the growing aggressiveness and excitement of the big players in business to participate in the PPP program. Their participation means that the government no longer has to shoulder all the expenses for infrastructure projects. On the contrary, the government even receives money for a project that is awarded under the build-- operate-transfer (BOT) scheme or its variations.
In April, 2013, San Miguel, which also operates the TPLEX, won the concession to build and operate the Ninoy Aquino International Airport Expressway. NAIEX will connect the Skyway system to all three NAIA airport terminals and the Entertainment City of the Philippine Amusement and Gaming Corp. SMC paid the government P11 billion for the contract to build the expressway and operate it for 30 years.
In my view, the success of these projects will encourage more participation (and investment) from Filipino tycoons. Ayala Corp., which built the MCX, is also now involved in other PPP projects. Early this month, Ayala was declared the winner in the bidding for the proposed Southwest Integrated Transport System (ITS), which is a 35-year concession to build and operate a transport terminal as well as commercial facilities in the 5.57-hectare former Food Terminal, Inc. A consortium between Ayala and Metro Pacific Corp. has completed the Automated Fare Collection System project, which established a common ticketing system for elevated railways in Metro Manila.
Infrastructure and the PPP have also opened opportunities for the tycoons to diversify outside their traditional businesses, so now they establish subsidiaries to pursue new ventures.
For instance, San Miguel is no longer into beer, food, feeds, or packaging. Its infrastructure business is conducted through San Miguel Holdings Corp. (SMHC), which consists of investments in companies that hold long-term concessions in the infrastructure sector.
SMHC’s projects include TPLEX, the Boracay Airport, MRT-7, NAIA Expressway, and the Skyway Stage 3, and operating toll roads – South Luzon Expressway (SLEX), Skyway 1 and 2 and the Southern Tagalog Arterial Road (STAR) Tollways. SMHC, through its subsidiary, Rapid Thoroughfares, Inc., owns a 45% equity interest in Private Infra Development Corp., which holds the 35-year TPLEX concession.
Other PPP projects that have been awarded or are in various stages of implementation include the P55.51-billion Cavite-Laguna Expressway (awarded to MPCALA Holdings, a unit of Metro Pacific Investments Corp.), a four-lane, 44.63-kilometer expressway connecting CAVITEX and SLEX, starting from Kawit, Cavite, and ending in Biñan, Laguna; the LRT Line 1 Cavite Extension and Operation and maintenance project (awarded to Light Rail Manila Corp, a consortium composed of Ayala Corp., Metro Pacific Light Rail Corp., and Macquarie Infrastructure Holdings), which will extend the existing LRT Line 1 from Baclaran station to Bacoor, Cavite, a distance of about 11.7 kilometers; and the NLEXSLEX Connector Road (awarded to Citra Central Expressway Corp.), a 14.82 kilometer, six-lane elevated toll road intended to connect South Luzon Expressway (SLEX) at Alabang to Balintawak in Quezon City, which is the beginning of the North Luzon Expressway (NLEX).
What we’re seeing now is not a fleeting moment of enthusiasm and excitement among the tycoons but a commitment for the long run. The PPP projects are long-term enterprises and continuing investments.
In my view, this can only be good for the Philippines. (To be continued)
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