No fee hikes at northern Mindanao airport sans upgrades – DOTr chief

DOTr Sec. Jaime Bautista —INQUIRER.net file photo/Tetch Torres-Tupas

MANILA, Philippines — Airport maintenance concessionaires must first undertake upgrades in the infrastructure of Laguindingan International Airport (LAI) in Misamis Oriental to justify higher fees that may be borne by passengers, Department of Transportation (DOTr) Secretary Jaime Bautista said on Monday.

At a press briefing in Malacañang, Bautista said higher charges may take effect at least a year following the private concessionaires’ takeover and only after pouring in investments to upgrade airport facilities.

READ: Aboitiz bags Laguindingan airport deal

“The adjustment on fees would not be implemented outright; the operators must first make improvements on its services,” he said to allay fears of higher travel costs due to the privatization of LAI.

Earlier, Bautista signed the public-private partnership (PPP) concession agreement between the government and Aboitiz InfraCapital (AIC), in a ceremony witnessed by President Marcos in Malacañang.

The airport is classified as an international airport that serves the cities of Cagayan de Oro, Iligan and Marawi, and the provinces of Misamis Oriental, Lanao del Norte and Bukidnon.

Not immediately

It is considered Mindanao’s second-busiest airport after Francisco Bangoy International Airport in Davao City, Bautista said.

But while the transport chief admitted that the privatization of LAI would result in higher airport fees, he clarified that this should not come immediately.

“As of now, the higher fees should not be imposed in the meantime. But since the private sector will invest billions of pesos, there will be a minimal increase to allow them to recoup the investments that they will put into the project,” he said.

He cited the case of the recent privatization of Ninoy Aquino International Airport, in which the concessionaire San Miguel Corp. is expected to impose higher passenger service charges or terminal fees only after a year since its takeover earlier this year.

According to Bautista, AIC aims to expand Laguindingan’s capacity from 1.6 million passengers to 6.3 million passengers per year as it takes over airport operations and maintenance.

The project is estimated to cost P12.75 billion, which will be shouldered by the private concessionaire at no cost to the government.

“The airport’s transformation should promote regional growth, generate jobs and livelihoods, and create investment opportunities,” he said.

After Laguindingan, the government is entertaining proposals to privatize “seven to 15” other airports in the country, including those in Bohol, Iloilo, Davao, and Kalibo in Aklan.