Philippine Business Magazine: Volume 13 No. 9 - Agenda

Gateways to Development

The government undertakes an ambitious airport construction and modernization program to spur regional development

By Roxanne V. Lu

Nothing delights a traveler more than to find an airport that provides comfort and security while he spends idle time waiting for his flight. It is also a fact that many visitors’ first glimpse and last image of a city is of its airport. First impressions are formed and expectations are set, and as the saying goes, first impressions last.

These may seem like minor concerns, but for cities and countries that want to stand out and make an impression, airport accessibility and comfort are certainly plus factors. Furthermore, a well-maintained and upgraded airport is not just about catering to the satisfaction of travelers but, more importantly, it also translates to being able to provide efficient and quick service to local and foreign airlines that transport cargo and passengers.

Improve and Expand

In 2001, Philippine airports accommodated 20 million domestic and international passengers. This number grew to almost 25 million in 2005, an increase of 25%. These passengers passed through 4 primary international airports (the Ninoy Aquino International Airport in Manila, Diosdado Macapagal International Airport in Pampanga, Subic Bay International Airport in Zambales, and Mactan International Airport in Cebu); 4 secondary international airports; 11 trunkline airports; 37 minor commercial domestic airports; and 30 feeder airports.

The number of airports would seem sufficient for a country of 85 million residents and 2.6 million visitors. However, most of the airports are in need of rehabilitation and expansion work in order to cope with the increasing air traffic volume. Recognizing this, the government, through the Department of Transportation and Communication, has prioritized the construction, rehabilitation, and upgrading of 31 airports all over the country.

Grand Plan

The airport projects are also being undertaken in line with the Arroyo administration’s newest grand plan-—the development of “super regions.”

In August, President Gloria Macapagal-Arroyo released Executive Order 561, which mandated the formation of five super regions: the Northern Luzon Agribusiness Quadrangle, Luzon Urban Beltway, Central Philippines, Agribusiness Mindanao, and the Cyber Corridor. The super regions concept highlights the grouping of regions and provinces by their economic strengths to stimulate their growth and development. The overall goal is to bring the country up to par with its Asian neighbors by enhancing each super region’s competitive advantage.

How do the airport projects fit into this grand plan? For one, the government is intent on boosting and harnessing the country’s abundant tourism potentials by improving feeder airports and airstrips to make hard-to-reach areas more accessible to visitors. In the Central Philippines super region, whose long white beaches and rich coastal and marine resources make it the premier tourist destination in the country, several airport projects are already underway or in the pipeline.

Aside from boosting tourism, the development of airports is expected to open up markets and link islands through an intermodal transport system. For instance, the passenger terminal expansion plan for the Diosdado Macapagal International Airport enhances its position as the country’s newest international gateway, as well as a freight and logistics hub.

Who’s Footing the Bill?

To empower the super regions, a set of infrastructure programs costing P372 billion has been lined up for completion by the end of 2010. Of the P372 billion estimated cost, P104.53 billion (28% of the total) is earmarked for the development of the prioritized airport projects. The government plans to tap funds from the national coffers, local government units, government-owned and -controlled corporations, financial institutions, foreign loans, and the private sector to meet the investment requirements.

The question now is: With 2010 just three years away, what are the chances of getting the funds ready and going in time to meet the targeted deadline?

Based on present indications, it seems the government is still holding on tightly to its available funds. Records show very slow spending, with third-quarter expenditure barely growing at 0.4%.

The onus is on the government to show that it is really intent on bankrolling these priority projects. Otherwise, the country might find itself 10 years down the road still waiting for the opening of its international airports, still making travelers use beat-up feeder airports, and wondering why tourism hasn’t picked up yet—all the while leaving visitors with unflattering first and last impressions. And as we all know, impressions really last.