Reuters reports that the Filipino government is seeking bids for a US$37 million DBFO toll road project called the Daang Hari-SLEX toll road that will link southern Cavite province to the South Luzon Expressway. Interest is expected from local firms such as San Miguel Corp , Metro Pacific Investments Corp , Ayala Corporation and JG Summit Holdings. Deadline for bids is 19 September 2011. Details on the road are here.
However, this is only one of three major highway projects expected to be put out to tender this year. The other projects are the NAIA Expressway Phase 2 project (NAIAX) and the NLEX-SLEX connector road. According to broadcaster ABS-CBN, “PPP Center Executive Director Phil Torio said the bidding process for NAIAX and the NLEX-SLEX connector may be started this year but there may not be time for final bids”.
In addition, Trade Undersecretary Cristino Panlilio said “ It also plans to push for raising the foreign ownership limit to 60 percent, or remove the limit entirely”. This will improve the attractiveness of Filipino toll roads for foreign investors able to have a controlling stake. It has been government policy for some time for major highways in the Philippines to be tolled PPP concessions, and so there are certainly some opportunities for investors, although many of these may be around enhancing operations. The risks of such investments need to be considered as well of course.
Meanwhile, the Philippine Daily Inquirer reports that Filipino toll operators are awaiting the outcome of a Supreme Court case that could force them all to impose a 12% Value Added Tax on toll charges. They have been opposing it, but the government insists that it needs the additional revenue and that tolls are a payment for a service.
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