‘ILOILO IS PRIORITY’: DOTr Vows to Hasten Villar Group’s Privatization of Iloilo Airport

By Rjay Zuriaga Castor

The Department of Transportation (DOTr) has committed to expediting the unsolicited proposal of a Villar Group-owned company to rehabilitate and expand Iloilo International Airport in Cabatuan, Iloilo.

DOTr Secretary Vince Dizon emphasized the urgency of privatizing and upgrading the airport to accommodate increasing passenger traffic and support Iloilo’s economic growth.

“We have to fix it immediately […] We assured the mayor and the governor that DOTr will fast-track the current public-private partnership (PPP) proposal from the Villar Group to ensure the sustainable development and growth of the airport,” Dizon said in a media interview on March 8.

Prime Asset Ventures Inc. (PAVI), a key subsidiary of the Villar Group, has an unsolicited proposal to operate, maintain, and expand the airport’s facilities, valued at approximately PHP21.16 billion.

The company first submitted its proposal in 2019 and was granted original proponent status for the project.

As of Sept. 16, 2024, PAVI successfully completed negotiations for its proposal.

The next steps involve submitting the project for approval to the DOTr and the Civil Aviation Authority of the Philippines (CAAP).

Once these agencies approve it, the National Economic and Development Authority (NEDA) Investment Coordination Committee must review the proposal before final approval by the NEDA Board.

Even with NEDA’s approval, the proposal will undergo a competitive challenge, allowing other firms to submit competing bids.

Dizon said the proposal is already at a “very advanced stage.”

The DOTr aims to award or privatize the Iloilo Airport by late 2024 or the first quarter of 2026.

While privatization is in progress, Dizon said essential repairs at the airport will begin this year using PHP190 million allocated under the 2024 General Appropriations Act through CAAP.

The budget will fund terminal building rehabilitation and enhancements such as additional seating, escalators, and elevators.

“This year, we will invest almost PHP200 million here. Then, when the private operator comes in, the initial investment for the first phase will be around PHP3 billion to PHP3.5 billion. So, we will speed this up,” Dizon said.

He added that the goal is to expand the airport’s capacity to handle up to 10.5 million passengers, making it comparable to Mactan-Cebu International Airport.

Since assuming office, Dizon has made Iloilo Airport his first inspection site outside Manila.

“Iloilo is the priority right now. It is one of the most advanced,” he said.

Privatization Is ‘Way Forward’

Dizon emphasized that privatization is the best approach to ensuring the sustainable development and efficient management of Iloilo Airport.

He said President Ferdinand Marcos Jr. has given clear instructions to prioritize the privatization of key infrastructure projects, including airports, to improve service quality and reduce government expenditure.

“The instructions of our president are clear—we need to privatize because that is the way forward,” he said.

“The beauty of privatization is that capital expenditures and investments will come from the private sector, minimizing the financial burden on the government,” he added.

Dizon also noted that privatization ensures proper operations and maintenance, citing the successful cases of the Mactan-Cebu and Clark airports.

Iloilo Gov. Arthur Defensor Jr. and Iloilo City Mayor Jerry Treñas both support the privatization of Iloilo Airport, saying it will accelerate its rehabilitation.