Bulacan Airport: A Sustainable Development Project

Bulacan International Airport | File Photo

There is no doubt that the government’s infrastructure program today is unprecedented in the country’s post EDSA history. The projects that have been accomplished including those are underway will surely shape how our country will fare in the years to come.

Now that the franchise to the Bulacan international airport has been granted to San Miguel Corporation’s San Miguel Aerocity, Inc. construction of the Php 740-billion airport will commence in the first quarter this year.

With the Department of Transportation as the implementing agency, the project involves the construction, operation and maintenance of a new modern airport in Bulacan with a design capacity of 200 million passengers annually. It will have four runaways and all aviation-related facilities. The project, an unsolicited proposal subjected to a Swiss challenge, was awarded to San Miguel Corporation in August 2019. With a cooperation period of 50 years, it is a public-private partnership under the Build-Operate-Transfer scheme.

The law, Republic Act No. 11506 grants the SMC subsidiary the franchise to construct, develop, establish, operate and maintain a domestic and international airport in Bulakan, Bulacan and an adjacent Airport City.

And like many government big-ticket infrastructure projects, the granting of the franchise triggered a brouhaha from oppositionists who refuse to look at the bigger picture and consider the economic benefits of the airport investment. On the onset, the support for the franchise was unanimous from both houses of Congress. No one voted against the bill in the Senate while in the House of Representatives, only a handful voted against it.

Let us give credit to our legislators. Surely they have made a thorough study of the bill knowing full well that that the project will benefit not only Bulacan but the entire country; not only this generation to which they belong, but future generations of Filipinos.

Pursuant to the franchise law, tax exemptions will be granted to SMC during the ten-year construction period. After construction, SMC can continue to enjoy tax exemptions but the exemptions will expire once the government through the Bureau of Internal Revenue determines that the franchisee has fully recovered its investment. Unless there are tax incentives, investors would mostly shy away from capital-intensive projects. Economists know for a fact that tax incentives encourage businesses and private companies to make investments that will benefit the community. Would SMC not abandon the Php740 billion project if there were no tax incentives especially at a time when air traffic are at its lowest and airlines are at the brink of bankruptcy because of the pandemic?

Consider these benefits that oppositionists refuse to acknowledge: employment generation, increased tourist arrivals, ease of travel and better quality of life.

SMC’s investment in the airport is expected to create jobs for millions of Filipinos many of them having lost their livelihood because of the pandemic that has resulted in the worst economic performance of the country since World War II. The jobs will be generated not only by the airport project but also by the major rail and road network projects that will be incorporated into the airport to provide seamless travel around the country and spur economic development in other provinces.

While the existing NAIA and Clark airport cater to the country’s short-term travel needs, these cannot address the 100 million passengers forecast in the medium-term. The Bulacan airport oppositionists did not take into account the long-term multiplier effect of being able to bring in more tourists with a world class infrastructure providing timely departure and arrival of passengers. The country relies heavily on tourism and better facilities are needed to attract more tourists once the pandemic is over. It is estimated that in 10 years 9 percent of GDP will be generated from San Miguel Aerocity, Inc.

All told, the airport development helps address the country’s air-travel competitiveness and efficiency and sustainability; creates jobs, opportunity and better quality of life as it ushers a new township that is affordable and accessible with the multiple links to NCR. Columnist Tony Lopez wrote “It isn’t inconceivable that after 50 years, Aerocity’s 2,500 hectares of prime land and its vertical infrastructure will be worth at least P2 trillion, value that goes to the government for foregoing P50 billion in taxes.”

Oppositionists have also raised the issue of subsidence in the Bulacan. Subsidence refers to the lowering of the earth’s land surface. The loss of land elevation is being address by SMC. It is preposterous to entertain the idea that a conglomerate like SMC would simply undertake a project without the necessary studies and analyses. For many years, water in Bulacan has been sourced from deep wells. Geologists concede that excessive extraction of groundwater primarily in the form of deep well construction and operation causes subsidence. With SMC’s Bulacan Bulk water project, affordable potable water will be made available to Bulacan residents and discourage use of pumps and reduce ground water extraction.

SMC has tapped global firm Royal Boskalis Westminster N.V., through its wholly-owned subsidiary Boskalis Philippines Inc., to undertake land development works for the airport project.

“Our selection of a global giant in dredging shows how ready, willing, and committed we are to do everything necessary to make sure this airport project is developed properly and sustainably,” SMC President and COO Ramon S. Ang said. “Boskalis has committed to ensure that the area will be suitable for development. It will be designed with the highest technical and environmental standards, so it can withstand potential large earthquakes, local typhoon conditions, and even future sea level rise.”

SMC is committed to ensure that the project will serve and benefit Filipinos for many generations to come.

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