FFE Magazine

Foreign contractors welcome to bid for big PH infrastructure projects

DPWH Secretary Rogelio L. Singson

MANILA, Philippines—The government plans to open up the state infrastructure market to more foreign contractors by 2015, Public Works and Highways Secretary Rogelio Singson said.

In a news conference at the DPWH head office in Manila, Singson said the move was meant to “level the playing field, but not to the detriment of local contractors.”

The DPWH, he said, would push for “progressive liberalization” of the construction industry by allowing foreign contractors to take part in state projects worth P1 billion and above. However, these contractors “will not be allowed to bring in sub-contractors or a labor force from outside the country, which is not good for our economy.”

According to Singson, the issue was already being discussed by the economic cluster in President Aquino’s Cabinet.

“There are ongoing discussions on improving [foreign contractors'] access to infrastructure projects within current laws,” he said.

A number of contractors from South Korea, Japan and China have expressed interest in bidding for local projects, he said, noting “the Chinese contractors are very active and aggressive.”

In a briefing paper furnished reporters, the DPWH said opening up the construction industry to more foreign contractors by 2015 was one of four agency “reforms” involving procurement practices.

The other reforms were “moving toward electronic bidding; indexing the net financial contracting capacity of contractors in their income taxes; and strengthening the borrowing capacity of contractors by paying them through letters of credit.”

At the same time, the DPWH head reported that the department had recorded a “big leap” in infrastructure spending in the first quarter with disbursements of P34.8 billion, or P16.1 billion (53.7 percent) more than fund releases during the same period in 2012. The amount, however, was P42 billion short of the agency’s obligated funds for the January to March period, which totaled P76.8 billion.

Singson credited the “higher pace of public works implementation” for the increased fund releases.

He said that “with the DPWH reform program of doing the right project with the right cost, the department has realized savings of over P16.3 billion during the past two and a half years due to the conduct of transparent and competitive bidding.”



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