MCIA deal to draw more foreign investments
The Department of Transportation and Communications said that the awarding of the Mactan Cebu International Airport (MCIA) public-private partnership deal was linked to drawing broader foreign investments even as a losing bidder said it was “disappointed” with the decision.
The DOTC said that its decision has helped bolster investors’ confidence in the Philippines, which has a history of contracts being canceled or revised partly due to politics.
“By sticking to bidding rules and refusing to be influenced by external factors, we are showing the world that the country now has an excellent investment climate,” Transportation Secretary Joseph Abaya said.
“Gone are the days when big-ticket contracts would be awarded despite being tainted with irregularities. As promised, bidding at the DOTC is conducted on a level playing field, because we follow ‘daang matuwid’,” he added.
Abaya said strengthening the process would help draw foreign direct investments, a measure where the country has lagged in the past.
“There is only one way to advance that perception: to prove it with our actions. If we promise honest and competent governance, we must show it. If we promise a level playing field, we must do it. We made those promises to investors when we began with this project, and now we have proven it,” Abaya added.
Even before the award was issued Friday, Sen. Sergio Osmeña III had filed a petition with the Supreme Court to stop the awarding to Megawide-GMR.
Legal justification
Abaya said the DOTC would comply with any Supreme Court order in case a temporary restraining order (TRO) was issued but he nevertheless said the department had all the necessary legal justification.
“We will have to honor any court issuance that will prevent the project from moving forward, even if we believe that there is no more time to waste in improving the country’s second busiest airport. What we can assure Cebuanos who are awaiting this project is that we have the law on our side and we will defend this project to the end,” Abaya said.
Megawide shares rally
Shares of Megawide Construction Corp rose as much as 7.7 percent in early trade Monday.
“Now, there’s no overhang,” Lexter Azurin, head of equity research at Unicapital Securities Inc, said regarding the impact of the contract on Megawide’s share price.
Before the announcement that the Megawide-GMR consortium won the contract for the MCIA expansion project, Megawide shares had fallen 10.7 percent as it was competing with another bidder for the airport tender.
In December, rival firm Filinvest Development Corp had sought GMR-Megawide’s disqualification from the bidding.
Filinvest Development shares were down 1 percent and the main share index was up 0.8 percent.
Azurin said Megawide’s “aggressive” participation in the government’s PPP initiative was “beneficial to its long-term earnings prospects.”
Other than the airport deal, the contractor has also bagged a hospital modernization and two nationwide-school building contracts under the state’s flagship infrastructure program.
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