MacroAsia must prove capability to fund Sangley airport project

MANILA, Philippines — Lucio Tan’s MacroAsia Corp. has to prove to the Cavite government that it still has the financial muscle to fund the first phase of the massive Sangley Point International Airport (SPIA) project before it can proceed with the development together with its Chinese partner.

Cavite Gov. Jonvic Remulla said they are assessing the financial capacity of MacroAsia amid the impact of the pandemic on businesses. “We are still evaluating the financial capacity of MacroAsia considering the economic climate everyone is facing,” Remulla told The STAR.

Based on its latest financial statement, MacroAsia has felt the impact of the pandemic on the aviation industry as it incurred a net loss of P856.7 million in the nine months ending September last year, a reversal of the P932.7 million net income recorded in the same period in 2019.

MacroAsia said the management teams of its aviation services companies have instituted cash conservation and cost-control measures to cope with the ensuing crisis and business downturn.

The firm has expertise in developing and operating key operating functions in an airport as part of the Lucio Tan conglomerate and as an affiliate of flag carrier Philippine Airlines.

MacroAsia president and chief operating officer Joseph Chua earlier said the company may bring in other members of the Lucio Tan empire onboard the airport project to provide additional financial muscle.

The first phase of the SPIA project was awarded by the provincial government of Cavite in February last year to the team of MacroAsia and state-owned China Communications Construction Co. Ltd. (CCCC).

MacroAsia has a 40 percent stake in the consortium, while CCCC holds the remaining 60 percent.

The consortium submitted in December 2019 the sole bid for the project, which will be implemented as a local government public-private partnership joint venture by the provincial government of Cavite.

Phase one of the project amounting to $4 billion involves the development of an interim first runway with an annual design capacity for 25 million passengers and the new Sangley connector road and bridge.

The consortium has been completing the qualification documents for the award, but the COVID-19 pandemic has delayed its processes, including the completion of joint venture documents prior to any signing of legal or financial contracts.

Following a series of extensions given by the Cavite government for its post qualification requirements submission, the consortium was able to submit in late November main documents such as their consortium agreement.

Jesse Grepo, legal officer of the Cavite government’s public-private partnership selection committee, told The STAR that there is currently no concrete timeline as to when the ongoing evaluation will be completed.

“Review is being conducted thoroughly. The documents are voluminous and tedious. These things take time,” Grepo said.

Presidential spokesman Harry Roque said last year the airport project would continue despite the blacklisting by the US of CCCC subsidiaries for their involvement in reclamation activities in disputed waters in the West Philippine Sea.