The long-term future of the Philippines’ main air gateway, Ninoy Aquino International Airport (NAIA) in Manila, is looking increasingly wobbly – the plain fact being that it will never be able to meet the projected capacity needs of handling 140 million travellers annually in the next 18 years. Designed to deal with 30 million passengers a year, it‘s already exceeded that by around 6 million. In short, a decision needs to be made – and fairly soon – regarding where to lay the runway tarmac for the future of Philippine air travel.
Of course, like most things – particularly big-ticket infrastructure items in the Philippines – the NAIA is a political issue. It’s been battled over in Congress ever since it was located to the American air base of Nichols Field at Parañaque and Pasay in 1948 shortly after Philippine independence from the US.
In 2015, the previous administration, led by Benigno “Noynoy” Aquino – NAIA is named in honour of his father “Ninoy” Aquino who was assassinated as he disembarked from an aircraft there in 1983 – was seeking to upgrade the airport’s terminal facilities by means of a PHP74.6 billion Public-Private Partnership (PPP) scheme. This, according to the PPP Center would allow the NAIA “to meet the International Civil Aviation Organization standards and develop the main gateway airport of the Philippines”.
In February this year, the current administration of Rodrigo Duterte put that project on hold. After assessing the limits of NAIA’s potential, it broadened the scope of airport development in the greater capital region and is seeking viability studies covering outlying provinces such as Bulacan, Cavite, Laguna and Rizal – all of which lie outside Metro Manila.
And while this may be part and parcel of reducing “Imperial Manila’s” claims to being the commercial hub of the Philippines – Duterte’s committed to decentralising power and reallocating the country’s assets more broadly – it’s also rooted in logistics. It’s not just that NAIA’s airport standards and capacity are woefully lacking; road access to and from it is too. Frankly, everything about the airport is problematic.
And so what’s now emerging are rival corporate camps each vying for airport supremacy – a battle royal between the country’s big-name corporations to get a piece of an airport mega-contract.
On the one hand Ayala Corp., Aboitiz Equity Ventures, and Metro Pacific Investments Corp., have expressed interest in getting involved with the NAIA upgrade; on the other, San Miguel Corp. (SMC), and SM Prime Holdings are looking to build from scratch outside Manila.
The interesting projects then are the ones that would be built from the ground up.
In Bulacan, SMC – which already operates the Boracay Airport – has plans for a 1,168 hectares airport complex comprising four runways, with provision for a further two. This will provide a passenger-handling capacity of 100,000 with expansion to take 150,000. It will cost around PHP699 billion and would take six years to construct.
In Cavite, SM Prime in partnership with the Tieng family and through their jointly held All-Asia Resources & Reclamation Corp. (ARRC) is planning to reclaim an initial 2,500 hectares of land at Sangley Point, the former US naval station. The airport which will have an annual passenger capacity of 50 million will operate with a dual runway system expected to cost in excess of PHP100 billion. This forms just part of the ARRC-proposed Philippine Global Gateway Project, a PHP1.3 trillion mega-plan at Sangley for an airport, seaport and mixed-use real-estate development.
Both projects are now under consideration by the National Economic and Development Authority and the Department of Transportation.
All sides are determined to make their case for which project should get the government’s nod. Ayala’s MD, Jose Rene Almendras, has said joining the development of a new airport would take too much time. “Bulacan and Sangley (won’t be finished for) 10 years from now. How soon can you build that airport? We will focus on NAIA to extend the life of NAIA,” he said.
SMC president, Ramon Ang, is unfazed: “We will finance everything, build everything by ourselves and take the risk,” he said.
What all that looks like to us is an embarrassment of riches. There’s plenty of appetite from the private sector to go in with the government to upgrade NAIA and extend its life, and there’s plenty of private funding ready to get involved in airport newbuilding.
But the real question is, which airport will be the Philippines’ premier gateway of the future? And that looks less and less likely to be NAIA.
Back in 2013, another proposal which had been floated before, gained political backing. This was to make Clark International Airport (CIA) in Pampanga that “Golden Gateway”. There was a lot of support for it at the time – not least because NAIA had just been voted the “Worst Airport in the World” by an online poll. The government was embarrassed and needed to control damage to the country’s image as a tourism destination and did so by unveiling grandiose plans for Clark International.
But the case that was made at the time was a serious one that would see CIA become the Philippines’ premier air hub with NAIA downgraded to a secondary airport.
And much of it made sense. Clark is bigger than NAIA sitting on 2,400 hectares of land. There was room for massive terminal expansion. Its 3.5 kilometres of parallel runways were claimed to be capable landing the Space Shuttle; certainly, apart from NAIA it’s the only other airport – there are more than 80 across the country – where the wide-bodied Airbus A380 can put down.
Over the course of a year however, the Aquino government became less keen on the proposal going on to re-energise investor interest in the NAIA upgrade.
Time now is running out and a decision needs to be made on the future of NAIA. From all the stats that are available, it’s plain to everyone that the present location of the country’s main air-travel complex is inadequate – even right now, let alone in 18 years time. It seems to make little sense pouring additional funds into NAIA knowing that it will always be snarled by congestion (photo); that it will never be much more than a hand-to-mouth operation. The longer-term view here, then, is where the smart money is likely to go.
This problem has been kicked around for too long by too many Congresses and it’s time for this government to bite the bullet and deliver a purpose-built international airport that can hold its head high with the likes of Singapore’s Changi, Hong Kong’s Chek Lap Kok, Bangkok’s Suvarnabhumi, and Kuala Lumpur’s Sepang.