"This will be history in the making."
On Jan. 15, San Miguel Corp. finally breaks ground for its P735.6-billion New Manila International Airport in Bulakan town, Bulacan province.
Top officials from President Duterte’s cabinet, the LGUs of Central Luzon, and of course, SMC Chair Eduardo M. Cojuangco Jr. and SMC Vice Chair and President Ramon S. Ang will grace the occasion.
With the groundbreaking, San Miguel will be making history.
Firstly, Bulakan, a 448-year-old coastal town, barely 31 kilometers north of Rizal Park in Manila and with a population of about 80,000, used to be the capital of Bulacan province and nearby Pampanga province, as well as of the entire Central Luzon, the richest region outside Metro Manila. In putting up NMIA there, SMC will in effect restore the town—and Bulacan province’s—preeminence as a capital hub.
Secondly, the NMIA is the largest and greatest enterprise ever in the Philippines to be undertaken by any single company or group of companies in the nation’s history.
SMC, the country’s largest and most diversified conglomerate, was given the go-signal on Sept. 18, 2019 to proceed with the development and construction of NMIA.
It had been a long grind for SMC and for its president, Ramon S. Ang, to begin construction of NMIA. The project had faced many hurdles. It underwent months of government scrutiny, from the lowest level of the bureaucracy up to the Office of the President.
Even after SMC was given the NTP (notice to proceed) in September, Finance Secretary Carlos Dominguez sought review by the Department of Justice to check its legal and economic viability. One cabinet member accused SMC of “building a white elephant in Bulacan.”
Aghast, in November, RSA sought an audience with President Duterte and his economic managers. “If indeed the project is a white elephant, there won’t be any international bank that will lend money to us,” he argued. Banks are lining up to provide credit lines. No. 2, RSA pointed out, “we are using San Miguel balance sheet against the loan. There is no guaranty or subsidy from the government. So what seems to be the problem?”
One economic manager retorted: “But huge capital will get out of the Philippines!”.
“But that’s San Miguel money, not money of the government,” Ang replied, calmly.
“You could use that money for a better project,” insisted the economic manager.
“What could be better than a project that could serve needs of our OFWs (overseas Filipino expats)?,” cut in Ang, still calmly.
Then the SMC president made his biggest point. “You know, sirs, San Miguel is into beer, food business, power business, oil, infrastructure. We funded all those with San Miguel earnings. We reinvest 100 percent of profits in the Philippines. We do that to create jobs, modernize the economy, make life better for Filipinos, make this country greater.”
Addressing Duterte himself, Ramon said: “Mr. President, this airport will be a feather on your cap. This mega project is in support of your Build, Build, Build. Also, Mr. President, I have received offers from the super business groups in the world to join or participate in this project. They all want to invest in the Philippines.”
Ang disclosed he is inviting the sovereign funds of Singapore, Malaysia, and other large countries, and the major tycoons in the region, including India, to invest in the Philippines. “These direct foreign investments will strengthen the balance sheet of the country,” he explained. Other local companies, he noted, “just keep on borrowing ODA (loans from foreign governments) which could bring down the country (if unpaid or because of onerous provisions).”
After that meeting, the NMIA was listed among the expanded Build, Build, Build list of Duterte’s priority infra projects. The list used to have only 75. It now has 100 projects.
The San Miguel airport is No. 83, with the project cost of P735.634 billion and as an unsolicited PPP (private-public sector project) under transport and mobility, and instruction to commence construction in six to eight months. Completion date is 2025 but RSA will probably operate at least one runway for Duterte to inaugurate before the President leaves office.
“NMIA will be the game-changer,” declared RSA, upon the signing of the 62-page 50-year concession agreement midmorning of Wednesday, Sept. 18, at the headquarters of the Department of Transportation (DOTr) in Clark Freeport Zone.
On behalf of the national government, Department of Transportation Secretary Arthur Tugade signed the SMC concession agreement.
It seems ironic the contract for Asia’s next most modern airport was signed inside Clark, a former American facility that is being developed by the government itself as a gateway international airport.
In addition to Clark, a consortium of seven conglomerates is proposing to upgrade and operate NAIA over a 15-year period. The National Economic and Development Authority has yet to approve the project.
DOTr Secretary Tugade said multiple airports would benefit the public. “Let it be a battle of commercial competitiveness,” he said on Wednesday. “Having multiple airports is something that the world’s biggest economies do. Ideally, there should be a train service linking these airports, which is also being pursued by the government. This complementation strategy was already part of the air transport roadmap from Day One. Rest assured, that’s what we are going to do,” Tugade pointed out.
The project of San Miguel Aerocity, Inc., SMC’s wholly-owned airport subsidiary, does not just involve land development, and the construction and operation of an airport.
The long-term strategy includes the construction of no less than 22 expressways over a ten-year period or longer. The scheme is called the NMIA Integrated Multi-Modal Transport Network.
Aerocity is aimed to attract 30 million tourists yearly beginning 2025 (from the present 7.1 million), drastically lower the cost of travel within the archipelago (a return ticket from Manila to the Visayas costs $500 because of runway congestion and traffic at NAIA), and contribute up to P1.5 trillion to the Gross Domestic Product (GDP or the total output of goods and services).