The Tourism Infrastructure and Enterprise Zone Authority (TIEZA) Board chaired by the Department of Tourism (DOT) in their meeting held on October 8 (Tuesday) in Pasay City, approved the inclusion of all TIEZA assets and Tourism Enterprise Zone (TEZ) development projects in the Public Private Cooperation Program (PPPC), adopting Joint Venture and Management Contract as additional modalities for privatization, in support of the agency’s goal to generate more private sector partners.
Last August 29, the TIEZA Board had approved the agency’s own joint venture guidelines (JVG) that will be used to allow private sector participation in the development, operation, management and/or disposition of TIEZA properties and facilities, whether owned, administered or controlled.
TIEZA anticipates that this initiative will increase chances of asset-based investments and promote more inclusive growth across the country, as well as expedite expected developments in Tourism Enterprise Zones (TEZs) through Public-Private Cooperation.
TIEZA Chief Operating Officer Pocholo Paragas said that the additional modalities for privatization will help accelerate tourism investments and development of tourism infrastructure in the country, enhancing revenue streams for the agency with less financial exposure of government.
“We want to broaden the scope of privatization as well as provide additional options of modes of contractual arrangements which the local or foreign investors can avail,” Paragas explained.
TIEZA COO asserted that the adoption of more innovative modalities of private sector partnerships will maximize the potentials of the agency’s assets, without losing the government ownership and control in the property. Through the proposed JV, TIEZA will retain control and supervision of the assets but will be able to tap on private sector expertise on the day-to-day operations of the assets as well as private sector funding of necessary improvements of the assets.
“We welcome the support and approval of the DOT and the other members of the Board to boost the privatization efforts through these alternative modes of private sector partnership,” Paragas said in a statement.
“To increase revenues and make it more advantageous to the government, we need to change our old paradigms and principles. Thus, the thrust to add JV and management contracts as priority modalities for the private sector to come in, aside from lease and sale,” he added.
During the Board meeting, the Board approved the initiation of public bidding for two operating properties namely Club Intramuros Golf Course (CIGC) and Balicasag Island Dive Resort (BIDR) for the last quarter of this year 2019, as well as the minimum financial bid parameters that will be offered to prospective private sector investors.
With the expertise and capital of the private sector, TIEZA hopes to improve these facilities and enhance the operations of the two properties, which have been incurring losses in the past years.
The Commission on Audit (COA) earlier recommended the privatization of these properties to lessen the unnecessary losses incurred by TIEZA in operating the two assets.
CIGC is one of the oldest golf courses in the Philippines. It is located at the heart of Manila and near government offices, universities, hotels, museums, commercial establishments and identified as the site for a cruise port. It also offers the only night golf in Manila.
BIDR on the other hand is the only resort situated in the entire Balicasag island, within the municipality of Panglao Bohol.
The entire island has a total land area of 25 hectares. The resort occupies 1.5 hectares of the island. With its marine sanctuary and five diving sites, the island dive resort is a prime ecotourism destination.
Paragas urged the private companies and consortia to consider investing in these tourist facilities noting their high revenue-generating capacity and tourism potential, with the adoption of strategic marketing initiatives and infusion of capital investment.