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30 March 2010

Philippine state firm rejects Kuwaiti offer to build Clark airport

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The state-owned Clark International Airport Corp. (CIAC) has rejected Kuwaiti firm Al Mal Investments’ $1.2-billion offer to build the new Diosdado Macapagal International Airport (DMIA) in the former US air base in Pampanga, reported the Philippine Daily Inquirer.

CIAC president Victor Luciano said the Kuwaiti firm wanted some conditions like tax perks and the commitment from the government not to build any other airport within a 150-kilometer radius, which the CIAC could not promise.

“There were several conditions that we could not agree on,” Luciano said in an interview.

Al Mal earlier offered to develop all civil components of the Diosdado Macapagal International Airport Terminals 1, 2 and 3 as well as the adjacent 1,500-hectare land at a total investment value of $1.2 billion.

He said the Kuwaiti company, which submitted an unsolicited proposal to build the new airport last year, had asked the CIAC for tax perks. “But we can’t give them that. We do not represent the government,” Luciano said.

He said Al Mal also wanted to operate DMIA terminal 1, which serves about a million passengers a year. But Luciano said terminal 1 was currently Clark Development Corp.’s (CDC) main source of revenues, which made it too important to risk losing.

“In their proposal, they did not give us a definite revenue-sharing scheme in case we allowed them to operate terminal 1,” he said.

Al Mal also wanted a ban on the construction of any airport within a 150-kilometer radius of Clark, another condition, Luciano said, which the CIAC could not make on the government’s behalf.

The DMIA, named after President Macapagala-Arroyo’s father, is being groomed as the country’s next premiere international gateway to eventually replace Manila’s congested airport system.

Airports in the capital currently serve close to 25 million passengers a year, or about 90 percent of all air traffic in the country.

Luciano said that despite the failure of talks with Al Mal, the CIAC still had three other offers from foreign and local firms to evaluate.


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