NEWS

By Richmond Mercurio

China Communications Construction Co. Ltd.

China’s actions and ambitions may affect the corporate infrastructure deals of state-owned firms in the Philippines, with the recent cancellation of China Communications Construction Co. Ltd. (CCCC)’s airport deal with the local government of Cavite just a start of potentially more that could follow, according to aviation think tank CAPA-Center for Aviation.

In a report, CAPA said political reasons may be behind the cancellation of the contract for the Sangley Point International Airport (SPIA) project previously awarded to the tandem of CCCC and Lucio Tan’s MacroAsia Corp.

CAPA believes that there must be more to it than just being “deficient in three or four items” and “a sign that they were not fully committed to the project” as earlier stated by Cavite Gov. Jonvic Remulla.

According to the aviation think tank, the hidden reason for the original process being cancelled suggests that Chinese companies, especially state-owned ones, may be about to find it more difficult to secure foreign airport development contracts.

“Politics may well be behind it, as is often the case. President Duterte has pursued warmer ties with Beijing since taking office in 2016, and this was among the biggest projects involving a Chinese firm under his stewardship,” the aviation think tank said.

“But when push comes to shove, relations with the US are more important,” it said, noting that the US is one of the largest foreign investors in the country and one of its largest trading partners.

“China Communications Construction Co. was among the Chinese firms blacklisted by the US in August 2020 for their roles in construction and militarizing artificial South China Sea islands,” CAPA said.

“That, together with China-originating pandemic, the collapse of the air transport business, the crackdown against democracy in Hong Kong and growing concerns about potentially military offensives by China throughout Asia, may have tipped the balance against Chinese investment in key infrastructure in the future,” it said.

The local government of Cavite last month kicked-off anew its search for a new partner for the Sangley airport project, publishing an invitation for interested parties to submit proposals.

Prospective bidders are given one month, from March 1 to 30, to purchase the bid documents which will contain instructions draft joint venture and development agreement, as well as project feasibility study, including schedules and updates.

The Cavite government has set the deadline for the submission of joint venture proposals on May 4.

Source: The Philippine Star