THE government hopes to wrap up project negotiations in good time even when more contracts are offered up as public-private partnerships (PPPs), while also hoping to minimize the contingent liabilities paid by the state, Finance Secretary Carlos G. Dominguez III said.
Speaking in a recent forum at Guangzhou, China, Mr. Dominguez said that PPP-funded infrastructure projects “must be delivered quickly and we cannot take too much time negotiating with the private sector on this.”
Mr. Dominguez also said his department will pay close attention to contingent liabilities in PPP contracts, which was not given due attention by past governments.
“We have taken a very serious position that we will limit severely the contingent liabilities on the government, and really the taxpayers, with regard to PPP projects,” he said.
Last month, Socioeconomic Planning Secretary Ernesto M. Pernia said that the government will be more stringent in issuing state guarantees, subsidies and material adverse government action (MAGA) in the PPP projects.
Mr. Dominguez also said that the project mode should be renamed Public Private-Partnership for the People (PPPP) to highlight the need for public works that are not be disadvantageous to the government and the public.
He said it used to take around 33 months on average for a PPP proposal to start project implementation, noting that “one project with competing private sector proponents took 60 months.”
Midway through the administration’s term, the government decided to review and update its list of infrastructure flagship program, which now contains 100 projects from the previous 75. It ruled out those deemed not feasible while including projects that are expected to be high-impact.
The list now also included 29 projects with PPP as a financing mode, up from nine previously.
The flagship-project list is estimated to cost P4.2 trillion. Some 22 projects worth P167.95 billion will be funded by the national budget; 49 others costing P2.31 trillion will be funded through foreign-aid loans; and 29 PPP projects will cost around P1.77 trillion. — Beatrice M. Laforga