Infrastructure

LAST WEEK’S announcement that an agreement between the Philippines and China to study the feasibility of the potential Panay-Guimaras-Negros Island bridge project is welcomed. It is reported that China will fund the feasibility study which will be implemented by the Chinese company CCCC Highway Consultants Co.

Feasibility is one thing.

Implementation is another.

We trust that the results of the feasibility study will be made public. Intuitively, the project could be viable.

The costs should be quantifiable.

But what about the benefits?

They will be huge, the economy of Guimaras, in particular, will benefit substantially. The fact that the islands would now all be connected by land-based transportation will, of course make an enormous difference.

But can the benefits be quantified?

At the end of the day, the viability of the project will be an act of faith. Are there conditions attached to the feasibility study? For example, if CCCC Highway Consultants Co. recommends that the bridge-building project should proceed, is there any obligation to go ahead?

If not, good.

But if there is already an implicit commitment to proceed, then this would be unfortunate. There is the question of finance. How will the funding be arranged? Would we be beholden to China? If so, what are the conditions, including the interest rate associated with the loan?

President Duterte’s successor, due to be inaugurated on 1 July 2022, 32 months hence, may be subjected to an irksome commitment because the project will not be completed by then.

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Socioeconomic Planning Secretary Ernesto Pernia last week announced that other bridge-building projects, previously considered under the public-private partnership (PPP) scheme will not now proceed. These include the P57.6 billion Luzon-Samar bridge, the P56.6 billion Cebu-Bohol bridge, and the P47.4 billion Leyte-Surigao bridge.

Therefore, we have to ask the question: Is the go-ahead for the feasibility study for the Panay-Guimaras-Negros bridge due to China’s interest in the project.

Pernia says that the three bridge projects which are not being implemented are due partly to the lack of technological and engineering equipment suitable for a deep water project. He also claims that the projects are not economically viable. How does he know when no feasibility study has been carried out?

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There are those who believe that the Duterte administration has not been sufficiently adversarial with China in connection with China’s controversial conduct in the West China Sea. But China has a way of providing indirect quid pro quos to those it considers to be friendly. For example, until this year, the majority of overseas visitors to Boracay have been South Koreans. But, according to statistics from the Caticlan Jetty Port, this year (January-June 2019) there were over 250,000 Chinese nationals visiting the island compared to just under 200,000 South Koreans. Could the huge rise in Chinese visitors be attributed to the Philippines being a ‘friendly’ country?

Interestingly China plus South Korea provided around 85 percent of overseas visitors. All other countries (Taiwan, US, UK, Australia etc) only provided 15 percent. (Incidentally, China does not like us providing separate statistics for Taiwan. Sooner or later we shall hear about this).

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The successful implementation of infrastructure projects is vital to our continued economic growth, We need more such projects and we need them to be implemented with greater rapidity./PN

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