Sino investors seek guarantee

CEBU, Philippines - Chinese investors who want to invest in big-ticket projects in Cebu province want the Philippine government to guarantee for Cebu’s projects.

Fang Yan, chairman of the China Third Harbor Engineering Co., Ltd. (CHEC), said they want to make sure that Cebu projects are financially viable.

“We are interested in the projects here. But we have concerns also. The purpose of our company is to make money/profit. We still have to check the project cost for us to determine if it’s financially feasible,” Yan told Capitol official in yesterday’s meeting.

CHEC is an international contractor that is a subsidiary company of China Communications Construction Co., Ltd., a Chinese publicly traded construction company.

Governor Hilario Davide, together with Capitol executives and Evelyn Nacario-Castro, head of the Metro Cebu Development and Coordinating Board Research, Program and Organizational Development Project Management Office, presented before the investors the Mega Cebu project, the trans-axial highway, and other big-ticket projects in Cebu.

It was not immediately known if the CHEC representatives were the same people who visited Davide earlier this month expressing interest to invest in Cebu.

Yan said it is easier to carry out the projects if both the governments of China and Philippines are involved. He said if the Philippine government will guarantee for the projects they can move ahead with the implementation of the projects.

“In return, our company will follow up for financing,” he said.

He suggested Capitol officials ask President Rodrigo Duterte to include Cebu projects in the country’s priority programs and projects.

P24 Billion

He said China has set aside $24 billion worth of investment and financing agreements for the Philippines following the signing of deals between Duterte and Chinese President Xi Jinping last month.

Of the $24 billion, $15 billion is for investment projects and $9 billion is for credit facilities.

“You have to push for your projects to be included in the priority list. Lobby them to the national. You might get some of this funding. Try your best and make use of the budget,” Yan said, adding that this is what other countries usually do.

“We also want these projects to push forward. We will also try our best to look for new mode for our cooperation. Find better solution,” he said.

Aside from the guarantee, Yan said Public-Private Partnership (PPP) is one of the effective solutions.

Davide said he will write to Duterte on the province’s intention to avail of the China grant.

“We will write the president sa atong intention. It the president feels maayo ang project, maybe i-grant ta. We will communicate with the national government and inform them about the investor,” he said.

He said the province is open for PPP and Build–Operate–Transfer schemes for the projects.

“We accept PPP and BOT. We don’t have funds to finance these big projects. We are planning to loan out money but it’s hard because we don’t want to burden our constituents. We have other projects to benefit our constituents. But we welcome suggestions and recommendations,” he said.

In response to the request of the investors to have the projects swiftly done without political drama as experienced in other countries, he said they “will try to make whatever undertakings hassle free and free political squabble.”

However, in the meantime, Yan said they need the information of the projects and their detailed engineering designs like the proposed Cebu trans-axial highway project.

He said all the proposed projects will be considered for further studies.

Engineer Edgar Sibonga, consultant on the trans-axial highway project, said the Regional Development Council has endorsed the request for a full-blown feasibility study on the project to DPWH central office.

He said they also submitted the pre-feasibility study in 2007 and 2008 and the updated study in 2015 conducted by the Provincial Planning and Development Office.

He said the financing institution for the development of any huge projects requires a full-blown study.

The trans-axial highway project is a 280-kilometer road that connects the northern and southern tips of Cebu. Starting from Daanbantayan town in the north, its path will traverse Cebu's mountains down to Santander in the south.

The project cost was estimated at P46.31 billion in 2007 but this increased to P93.72 billion in 2014. The project has several proposed components, including reclamation areas, economic zones, seaports, water systems, and housing and commercial centers. 

Also among the proposed components are windmills and hydro and solar power generation plants in remote areas of Tuburan and Argao.

The highway was first proposed during the term of former governor Emilio Osmeña and was later championed by the late vice governor Gregorio Sanchez Jr.

A Malaysian company earlier offered to undertake the project under a public-private partnership scheme. The engineering company YEC International is also willing to build the proposed 520-megawatt solar power worth P40.1 billion through PPP.

China Communications Construction Co., Ltd. is one of the largest road and bridge construction companies and a major port design and construction company. The company is involved in some of the most important and complex road, bridge, tunnel and port projects in China.

It is also one of the largest dredging companies globally, and according to WorldCargo News, CCCC is the largest global manufacturer of container cranes by ship-to-shore container gantry crane deliveries in 2013.  (FREEMAN)