Inquirer Northern Luzon

‘It’s more fun than an airport’ in Subic

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An entirely different plan for the idle Subic Bay International Airport (SBIA) is taking shape and Roberto Garcia, chair and administrator of the Subic Bay Metropolitan Authority (SBMA), sums it up simply: “It’s more fun than an airport.”

“[The SBIA] will cease to be an airport,” he said during an Inquirer roundtable discussion at the Subic Bay Freeport on Saturday.

Announced in his “State of the Freeport Address” earlier, the plan shocked some and excited many.

The plan is one of the “out-of-the-box” solutions proposed by Garcia to attract more investments to Subic and increase its revenue stream.

“We will convert the airport into a family-oriented, integrated, international tourist destination. Something like Sentosa [in Singapore],” he says.

Over 20 million tourists visited that Singapore island resort last year, and Garcia is looking at three million visitors to come to the new Subic project, which might need some $10 billion to begin.

Here’s why SBMA is doing a drastic change of use of the SBIA land, a prime piece of real estate which spans 200 hectares and formerly the Cubi Point Air Station (Radford Field) of the US Navy.

The airport, formerly home to courier giant FedEx, has been underutilized, causing its income to drop from P255.2 million in 2005 to P36.6 million in 2011, and netting after debt servicing an average loss of P150 million since 2010.

The larger situation calls for decisive action, Garcia says.

Giving low lease rates while paying three loans worth $10 billion, the SBMA took in total losses of P7 billion over the last 20 years. It fulfilled its mandate, though, creating 88,957 jobs as of 2011 and helping the Bureau of Internal Revenue and Bureau of Customs remit taxes worth P1.1 billion and P6 billion, respectively.

Subic survival

Also, the free port has only 300 ha of land left to put on lease and these are not contiguous. The bulk of the former naval base of the United States is protected forests.

Garcia says the SBIA has “become redundant” because of the Clark International Airport at the Clark Freeport, a 40-minute drive from the Subic Bay Freeport via the Subic-Clark-Tarlac Expressway.

The conversion of the SBIA, he says, will assure the survival of Subic.

The US Navy built the airport during the Korean War in the 1950s. It was rehabilitated when former Sen. Richard Gordon chaired the SBMA immediately after the departure of the US Navy in 1992.

“You cannot do this (idea) anywhere else. As free port, Subic will be very competitive,” Garcia says. Promoting the nearby container terminal, which is 92 percent underutilized, is going to be stepped up, he says.

He says Tourism Secretary Ramon Jimenez Jr. welcomed the SBIA conversion plan and described it as a “very good project.”

The plan consists of having convention centers, business process outsourcing parks, a science and technology center, casinos, theme parks, a golf course and luxury villas, among others.

“We will make Subic an iconic destination. It is going to be a secured community, which is important, especially for Chinese visitors,” he says.

“We’re offering 50-year leases. The beauty of this project is what bankers call shovel-ready because you have existing infrastructure and the runway will be the main avenue.”

With this, the job of the SBMA in converting the US base takes a new level, he adds.

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  • http://profile.yahoo.com/6NOMVLC5HDV6PZCEUSYH26O4JI yaptangcom

    “Giving low lease rates while paying three loans worth $10 billion, the SBMA took in total losses of P7 billion over the last 20 years.” Not exactly a winning and sound business proposition by any stretch of the imagination. Now comes another brilliant, innovative and out-of-the box idea from SBMA chair/administrator Roberto Garcia, which calls for an initial funding of at least $10 billion! Truth be told, SBMA is still mired in billions of dollars in debt coupled with the growing perception by the inability of the government, past and present, to inspire and instill investor confidence in SBMA, make Garcia’s ambitious and grandiose proposal ill-timed and ill-advised. Let’s be cognizant of the fact that SBMA is still paying three loans worth $10 billion, on top of the P7 billion in total losses over the past 20 years, before the new leadership embarks on another multi-billion dollar project we could ill afford. Another white elephant is the last thing we need. 

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