Monday, 4 May 2009

Philippines' $1.2-billion Clark airport investment deal to be finalized

BERNARDETTE S. STO. DOMINGO
BusinessWorld
http://www.bworldonline.com/BW050409/content.php?id=052

THE GOVERNMENT is finalizing a deal for a $1.2-billion investment commitment from Kuwaiti construction giant Al Kharafi and Sons Group to build and develop a new airport terminal at the Clark Freeport in Pampanga, Malacañang said yesterday.

Press Secretary Cerge M. Remonde said President Gloria M. Arroyo had met with the head of the Al Kharafi Group during her stay in Marsa Alam, Egypt before proceeding to Cairo where she would meet with Egyptian President Hosni Mubarak.

"We are here in Marsa Alam for an investments mission. We spoke with Sheikh Nasser Al Kharafi, one of the biggest financiers in the Middle East. He is interested in investing and developing the Clark airport and aviation city," he told reporters in Manila via telephone.

Trade Secretary Peter B. Favila for his part said the project will involve an initial investment of about $100 million-$300 million.

"The total project cost is about $1.2-$1.5 billion. [Construction should start] ideally within first semester," he said.

The new passenger terminal is part of the government’s bid to develop Clark as the country’s next international gateway, Clark International Airport Corp. (CIAC) President Benigno N. Ricafort said in a separate interview.

Under the joint venture deal with CIAC, whoever gets the contract must design, build, finance and operate the new airport.

"This is good news. The airport terminal is crucial because we’re increasing our passengers/flights. The offer has to be finalized, we still don’t know what they [Mrs. Arroyo and Mr. Al Kharafi] agreed upon but I think within 30 to 60 days, this would be finalized," he said. The proposal may still be subjected to Swiss challenge for transparency, he added.

CIAC is targeting to open the new airport facility by the middle of 2010 with a capacity of at least three million passengers a year.

Clark’s present terminal at the Diosdado Macapagal International Airport can hold two million passengers yearly. In comparison, Manila’s airport system has a combined capacity of over 30 million passengers a year.

Officials have said Clark has more room for growth than Manila, with around 4,200 hectares of land that can be used for expansion.

The President left for an official visit to Egypt on May 2. She will proceed to Syria for a state visit on May 3.

Malacañang earlier said Mrs. Arroyo’s visit to Egypt will focus on interfaith dialogue, investments, and securing support for the Philippines’ long-standing bid for observer status in the Organization of Islamic Conference. She is also expected to meet with Arab investors and the Filipino community there.

During her state visit to Syria, she is expected to meet with Syrian President Bashar Al-assad, scout for investment opportunities and meet with representatives of about 17,000 Filipinos working in Syria.

Mrs. Arroyo is also scheduled to sign partnership and cooperation agreements with the Syrian president. Deputy Presidential Spokeswoman Lorelei T. Fajardo earlier said about 12 agreements will be negotiated during Mrs. Arroyo’s trip to Cairo.

These agreements include:

* promotion and protection of investments;
* memorandum of agreement between the Philippine Chamber of Commerce and Industry and the Federation of Egyptian Chambers of Commerce;
* memorandum of understanding on tourism cooperation;
* executive program for cultural cooperation;
* memorandum of understanding in the field of health, medical science and pharmaceutical production;
* memorandum of agreement on technical cooperation in agriculture; and
* memorandum of understanding on establishment of mutual recognition and authentication of halal certification.

Mrs. Arroyo will be back in Manila on Thursday.

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