Manila: There are more than 90 airports in Philippines. Now, the country has earmarked “at least” 15 airports for privatisation from next year.
The aim: drive infrastructure spending, tourism and job creation, while improving efficiency and speeding up public service projects with private money.
It’s a bold move for the Philippines’ aviation sector. Spearheaded by the Department of Transportation (DOTr), its aims to bolster the nation’s position as a regional air travel hub.
The announcement by a senior official comes on the heels of the privation of its main aviation gateway, the Ninoy Aquino International Airport (NAIA), in an effort rehabilitate the airport and improve capacity from 32 million to 62 million passengers annually.
Modernisation
Packaging for these projects comes under the Public-Private Partnership (PPP) scheme, which aims to modernise and expand critical airports.
The privatisation moves will be launched with the support of global financial giants — the World Bank-International Finance Corporation (IFC) and the Asian Development Bank (ADB), according to a senior official.
“We are closely working with the World Bank–International Finance Corporation as well as with the Asian Development Bank for the launch of additional PPP projects for next year,” declared Hector Villacorta, the DOTr’s Assistant Secretary for Communications and Commuter Affairs, a recent forum.
It embodies optimal risk allocation between the parties – minimising cost while realising project developmental objectives. Thus, the project is to be structured in such a way that the private sector gets a reasonable rate of return on its investment.
PPP means the government will not spend money for an infrastructure project used by the public. It addresses the limited funding resources of the public sector thereby allowing the allocation of public funds for other priorities, while allowing private investors to recoup their investments.
It is governed by the PPP Code.
Foundation
Alongside attracting foreign capital for transport infrastructure, the country is advancing a new visa programme designed to lure the world’s top talent to help fuel innovation and propel the nation toward unprecedented growth.
There are currently 90 airports across the Asian nation, of which 40 are rated either as Class 1 and Class 2 airports.
The biggest is NAIA, also known as the Manila International Airport, which consists of four passenger terminals, with another one in the pipeline.
NAIA's privation was just recently concluded: On September 17, the San Miguel Corporation-led consortium, known as the New NAIA InfraCorp (NNIC), kicked off a 170.6-billion-peso ($3.02 billion) rehab project under a PPP deal with the government.
Airports up for privatisation
Villacorta, speaking on behalf of Transportation Secretary Jaime Bautista at the World Trade Centre Manila on September 18, outlined the bold vision that promises to revolutionise the country’s aviation infrastructure.
The plan, which covers airports from the farthest reaches of Luzon to the southernmost islands of Mindanao, includes:
- Luzon: Basco, Busuanga, Cauayan, Daraga in Bicol, and Tuguegarao.
- Visayas: Bacolod, Calbayog, Catarman, Catbalogan, Ormoc, and Siquijor.
- Mindanao: Camiguin, Davao, General Santos, and Surigao.
Based on an official summary of PPP “Projects in the Pipeline” released by the Philippines’ Department of Budget and Management (DBM) earlier this year, the total cost of the upgrades could hit about $4 billion.
“(Our) projects in aviation focus on the upgrade, expansion, and modernisation of airports,” Villacorta stressed, signaling the government's intent to align with international standards and respond to increasing passenger and cargo demand.
Altogether, these projects are estimated to more than $2 billion.
It codifies all prior statutes related to PPP (including the original PPP law in 1990, the 1994-era BOT Law, or Republic Act No. 7718) under a comprehensive law, and clarifies ambiguities in the previous legislations.
Privatisation
In a race for development, airports in Laguindingan and Bohol-Panglao have already entered the privatisation phase, currently undergoing a “Swiss challenge” —a competitive process that invites third parties to challenge unsolicited proposals.
The DOTr is also considering unsolicited development proposals for key tourist gateways like Iloilo, Kalibo, and Puerto Princesa, with the ADB assisting in evaluation and planning.
“ADB is helping us evaluate how to proceed in upgrading, expanding, or constructing the airports in Busuanga, Cauayan, Tuguegarao, Basco, Camiguin, Calbayog, Catbalogan, Catarman, Ormoc, and Surigao,” Villacorta said, outlining the critical role international partnerships play in advancing the country’s infrastructure.
Bicol Daraga - Php4.81 billion ($84 million)
Sayak Siargao Airport - Php0.86 billion ($15 million)
Davao International Airport - Php56.24 billion ($988 million)
Laoag International Airport - TBD
New Busuanga Airport - Php1.35 billion ($24 million)
New Surigao Airport Project - TBD
New Bohol International Airport Project - Php4.53 billion ($80 million)
Laguindingan Airport Project - Php12.75 billion ($224 million)
Puerto Princesa International Airport - Php11.22 billion ($197 million)
Iloilo International Airport - Php14.70 billion ($258 million)
Kalibo International- Php3.62 billion($64 million)
Altogether, these projects are estimated to be worth more than $2 billion.
North Line Project
Adding the 30.3-km MRT 7 “Airport Access-North Line”, which envisions a train network going to and from the New Manila International Airport and neighboring provinces, will raise airport-related PPP projects to Php130.90 billion ($2.3 billion), as per DBM.
Meanwhile, the government is pursuing greenfield airport projects in Masbate, Naga, Pangasinan, Siargao, and Zamboanga — fresh endeavours to bring air connectivity to more remote regions.
As part of the nation’s commitment to inclusivity, Villacorta emphasised the ongoing development of airports in smaller, underserved communities, stating: “We also continue to develop airports in islands and communities such as those in Itbayat, Maasin, Hilongos, and Siquijor.”
These developments align with President Ferdinand Marcos, Jr.’s directive to keep the nation’s supply chains moving efficiently.
Villacorta underscored the importance of a robust transport network, linking it directly to economic growth: “If transport systems are efficiently functioning, it will translate into a well-oiled logistics system, and thus increase the competitiveness of private business, while lowering the cost of moving people and goods.”
Ambitious wave
This ambitious wave of airport modernisation is poised not only to improve air travel but will catalyse broader benefits.
From tourism to trade, every upgraded terminal and expanded runway will contribute to positioning the Philippines as a competitive player on the global stage.
Shaped by the success of PPP projects for infrastructure buildup, this could mark a turning point for the country’s aviation and tourism sectors.
