Megawide wants shot at $2-B Naia upgrade
Despite the downturn in aviation, Megawide Construction Corp. and partner GMR Infrastructure want to jumpstart the $2-billion modernization of Manila’s Ninoy Aquino International Airport (Naia), betting that flyers and congestion will return once the COVID-19 pandemic passes.
For Megawide-GMR—the venture behind Mactan Cebu International Airport’s operations and expansion—current conditions are ideal to upgrade Naia given the years it will take before activity bounces back.
“This is the best time to redevelop Naia while air traffic movements and foot traffic inside the terminals are still limited,” Megawide chair and CEO Edgar B. Saavedra said in an interview on Tuesday.
Megawide-GMR became the front-runner to upgrade Naia after negotiations last July failed between the government and Naia Consortium, an alliance of Filipino tycoons and Singapore’s Changi Group.
After two years of talks, the consortium withdrew in the middle of the pandemic, citing the government’s steep terms and the evolving views within their ranks on the project’s viability.
This came despite the government’s decision to relax its terms, extending the concession period from 15 years to 25 years to allow the private sector more time to recover their investment.
Megawide-GMR’s offer has yet to be approved, which will pave the way for a competitive challenge.
Megawide said the upgrade of Naia would eliminate congestion in seven years or less. The plan calls for gradual expansion of capacity to about 65 million passengers a year.
Before the pandemic, Naia was struggling with over 45 million passengers yearly—above its design capacity of 31 million passengers per year. This led to frequent flight delays and cramped passenger waiting areas.
Saavedra said their offer would include a passenger railway link to connect Naia’s passenger terminals within the 650-hectare complex. This is different from Naia Consortium’s offer to link the terminals through a dedicated bus system.
Megawide-GMR’s offer is facing challenges given that certain quarters oppose the privatization of Naia.
Earlier, Rep. Jericho Nograles questioned the need for the private sector’s participation, saying the state-run Manila International Airport Authority had adequate financial resources to pursue the massive project.
However, there are no major plans for the government to upgrade Naia because the project is designated as among its flagship “Build, Build, Build” infrastructure pipeline to be developed by the private sector.
Nograles is also seeking to disqualify Megawide, claiming it lacked the necessary equity to finance the full upgrade cost of about P107 billion.
“Our credentials and capabilities have been questioned in the past but Megawide has consistently delivered first-world infrastructure projects,” said Louie Ferrer, Megawide chief branding and corporate affairs officer.“We have no doubt that we will be able to sustain future expansion without issue despite qualification requirements having been based on initial development phases only,” Saavedra said. INQ
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