Friday, July 31, 2009 | MANILA, PHILIPPINES [ BusinessWorld Online ]
THE GOVERNMENT expects to generate P13 billion, up from the P10 billion estimated earlier this year, from the sale of parts of the Food Terminal Inc. (FTI) this quarter, the Finance department said.
"The indicative price is P13 billion," Finance Undersecretary Crisanta S. Legaspi said in a recent interview.
She said the indicative price — higher than the previous estimate of P10 billion — is based on updated appraisal value of the property.
"We will sell 103 hectares of the property," Ms. Legaspi said.
The FTI is a 120-hectare agro-industrial commercial estate in Taguig City that hosts about 300 firms engaged in various lines of production and services.
Ms. Legaspi had previously said that the government will only sell 103 hectares of FTI as state grain agency National Food Authority already owns some portions of the property.
She said 79 hectares of the property to be sold are ready for development, while the remaining 24 hectares are covered by existing contracts.
The government expects privatization revenues to reach P30 billion this year. Other items to be placed on the auction block within the year are the government’s 40% stake in the Philippine National Oil Company-Exploration Corp. and the 50-year lease contract of a state-owned property in Fujimi, Japan.
"The target date [for the privatization of these items] is September 30. But what is important is it [sale] should come before the end of the year...I think there could be some spillover to October or something like that. It does not exactly need to be September," said Finance Secretary Margarito B. Teves last week.
He added that the exact dates of the auctions will depend on market conditions.
No hurry
In a related development, the government is not in a hurry to re-bid the contract involving the development of a Tokyo property that has been nullified due to its supposed irregularities.
Last month, the Justice department junked the government’s deal with Nagayama Taisei Corp. (NTC), a Japanese consortium that won the right to develop a 2,489-square meter property in Tokyo’s Nampeidai district in 2005. The department said the NTC, which consists of Nagayama Architects Co., Ltd. and Taisei Corp., submitted falsified bid documents that were not notarized. State lawyers have said that the absence of notarized documents proving the existence of NTC means that the awarding of the contract is null and void.
The Finance department had said it will re-bid the project, but Ms. Legaspi said this may not be done within the year.
"Maybe not," she told reporters when asked if the bidding for the contract will be done this year.
"We will focus on the other assets for now," she added, referring to FTI, PNOC-EC shares and the lease contract for the Fujimi property.
Ms. Legaspi noted that the contract for the development of the Nampeidai property may still be subject to legal action as the NTC may defend the validity of the deal.
The Nampeidai property was acquired by the government as part of the reparations of the World War II.
Under the contract, the NTC was supposed to construct a building worth ¥1.7 billion (roughly P864 million) on the property and to pay the government ¥480 million (around P244 million) worth of development fees. — Alexis Douglas B. Romero
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