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COA: Full operations of Apeco are in doubt

/ 05:16 AM July 17, 2018

CITY OF SAN FERNANDO — Although the national government had invested up to P1 billion since 2008 to develop a 12,923-hectare free port in Aurora province, there has been no evidence that the free port was ready to be fully operational by 2021, according to the Commission on Audit (COA).

The Aurora Pacific Economic Zone and Freeport Authority (Apeco), given a total appropriation of P1.8 billion, “had yet to present significant desirable outcomes and would be hard put to be fully operational as targeted within the next four years,” according to the COA report.


Apeco operates the Aurora Pacific Economic Zone and Freeport.

But Apeco cited a budget reduction to explain why it slowed down infrastructure projects and gave priority to repairs of facilities damaged by typhoons.


From a high of P400 million in 2009 appropriations for capital outlay, Apeco has had a zero budget since 2014.


COA traced the poor showing of Apeco to “major lapses in planning, inefficient investment programming and unsupportive personnel actions thus, [the] timely realization of the promised development and progress to the residents of Casiguran and the province of Aurora is not certain.”

Republic Act No. 10083, the law that created the Aurora free port, envisioned it to be a “decentralized, self-reliant, and self-sustaining industrial, commercial/trading, agro-industrial, tourist, banking, financial and investment center with suitable residential areas.”

Following a master plan made by Design Science Inc., Apeco identified 81 investment projects. But only 20 projects were started and of these, only 12 were completed in 2017, while one had been suspended “indefinitely,” according to COA.

Storm losses

COA noted that Apeco lost P22.4 million to two typhoons and spent P31.3 million in repairs “due to apparent failure to consider in the architectural and engineering design provisions for the fact that Casiguran is almost always at the path of 90 percent of typhoons that passed through the country every year.”


The corporate building, for instance, was made of glass walls.

COA questioned Apeco’s claim of acquiring land at a cost of P138.4 million in San Ildefonso peninsula because of opposition by indigenous people, farmers and fishermen as well as the absence of boundary delineation by the Department of Environment and Natural Resources.

Unused warehouse

COA also noted that an ice plant, built at a cost of P9.8 million, has not been used since 2013 because the cost of operations was higher compared to the expected revenues.

Apeco has also not used a warehouse that it rented and renovated at the Clark International Airport for P5 million, COA said.

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TAGS: Apeco, Aurora Pacific Economic Zone and Freeport Authority, COA, Commission On Audit
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