Infrastructure and Governance in Megacities Metro Manila
Outline• Megacities of the World• Mega Manila – History to Present: • Private-led Development in Real Estate • Poor quality and development in Transport and Social Infrastructure – Outlook: • Private Participation in Infrastructure Development – Capacity of the Private Sector (Financial and Technical) – Philippine Constructors Association (PCA) » Public-Private Partnerships (PPP) Program
Megacities of the World
Megacities: Framework PUBLIC PRIVATE Products Gateway INFRASTRUCTURE and(Airport, Seaport, Roads) DEVELOPMENT ServicesPrinciples and Plans GOVERNANCE People
10 Largest Cities of the World (2011) SEOUL TOKYO NEW SHANGHA YORK DELHI I GUANGZHOUMEXICO MANILACITY MUMBA I SAO PAULO
10 Largest Cities of the World (Time Magazine, 2011) Megacity Population Population GDP per Capita (in Million) Density (USD) (population/sq.km)Tōkyō 34.4 4,750 42,994Guangzhou 25.4 3,417 5,630Seoul 25.2 16,700 11,548Shanghai 24.9 13,400 9,357Delhi 23.5 11,050 7,106Mumbai 23.2 29,650 9,009Mexico City 23.0 8,400 16,957New York 22.0 2,050 63,909São Paulo 21.0 9,000 18,476Manila 20.4 10,550 7,304
Megacities• Megacity: >10 million people (some consider 5-8 million inhabitants)• Dynamics of urbanization not necessarily the same – Wealthier countries have much lower growth rates – Megacities in other regions are expected to continue growing• Two-edged sword – Vast opportunities: Market and Income Concentration – BUT with Challenges • High Cost of Living with Congestion and Pollution • Infrastructure AND Governance • Government AND Private Sector • Planning AND Implementation
Philippines PhilippinesNational Income USD 170 BLand Area 299,764 km2Population 88MPopulation 300/sq. km.DensityPer Capita USD 1,850Income
Mega Manila Metro Manila (% of Philippines)National Income 34%Land Area 0.2%Population 13%Per Capita Income 7,304(USD)
Megacities: Framework Case of Mega Manila PUBLIC PRIVATE Products Gateway INFRASTRUCTURE and(Airport, Seaport, Roads) DEVELOPMENT ServicesPrinciples and Plans GOVERNANCE People Average Best Poor Record Performance Practice
Mega Manila: Present• Mega Manila: a collection of 17 highly-urbanized cities• High and concentrated economic growth – Anchored on international airport and seaport, Agglomeration of industries and markets inside• Private sector-driven development for the last 5 years: Especially in real estate development – Residential, commercial, recreational and institutional buildings• Infrastructure has lagged behind – Poor quality of transport infra: rail, airport, seaports, and roads – As well as social infra: schools and hospitals
Overall Infrastructure Performance Japan Legend Taiwan Korea 1 = poorly developed andHong Kong inefficientSingaporePhilippines 7 = among the best in the Vietnam world India Indonesia Average of 133 China countries Thailand Malaysia Source: World Economic Forum, 0.0 1.0 2.0 3.0 4.0 5.0 6.0 7.0 8.0 “The Global Competitiveness Report, 2009-2010
Private Sector-Driven Growth (Especially Real Estate Development)Case Study:DATEMConstruction
DATEM ConstructionWe are a private construction company in the Philippinesestablished in 1984. We offer a wide range of services, fromtechnical consultancy to construction of complex projects suchas commercial buildings, residential structures, recreationalfacilities, worship centers, healthcare facilities, industrial parks,educational centers and other infrastructures.Over the past few decades DATEM has steadily grown andbecome a major participant in the reshaping and improvement ofthe landscape of the Philippines ’ major urban centers,particularly the megacity of Metro Manila.In our projects, we put distinctive focus on value-engineering andinnovation, and providing our clients with the highest qualityproducts and services.
ONE ROCKWELLRockwell Drive, Rockwell Center, Makati City2 Upscale residential condominium towers (45and 55 storeys) with a 4-level common basementparking area, and commercial and office spacesat the Ground Floor.Total CFA: 134,102.0 sq.m.Contract Amount: Php 2,519,537,788.29 (USD 58.6M)Commencement Date : May 2008Completion Date: October 2011Methodology:Used the “Mevadec” formworks system (simpleand fast assembly and stripping; few proppings).Used precast concrete for the stairs and ledges.
DISCOVERY PRIMEA6749 Ayala Avenue, Makati CityA 67-storey luxury apartment (90 residential flats of 382 to680 sq.m. each) with 6 levels of basement parking area. It ispresently under construction and it employed the “Top-DownMethod of Construction”.Total CFA: 95,614.0 sq.m.Contract Amount: Php 1,373,646,512.88 (USD 32.0M)Commencement Date : July 2008Completion Date: August 2013Methodology:Uses the “Mevadec” formworks system.Uses structural precast concrete for the exterior walls andprecast panels (Ecowall) for the interior partitions.
ONE SHANGRI-LA PLACEEdsa cor Shaw Boulevard, Barangay Wak-wak,Mandaluyong CityA 60-storey twin-tower luxury residential condominiumwith 10 floors of Podium and a 2-level common basementparking area. At the Podium floors are retail and parkingspaces.Total CFA: 165,000.0 sq.m.Contract Amount: Php 4,015,623,269.25 (USD 94.0M)Commencement Date : May 2010Completion Date: April 2014Methodology:Uses the “Mevadec” formworks system.Uses structural precast concrete for the slabs.
ARYA RESIDENCELot 1 Block 4, Fort Bonifacio, Global City, TaguigCityA 45-storey residential building with 5 basements.The project is aiming for a LEED Certification ofGold.Total CFA: 64,743.20 sq.m.Contract Amount: Php 1,018,000,000.00 (USD 23.6M)Commencement Date : January 2011Completion Date: June 2013Methodology:Uses structural precast concrete for the exteriorwalls.
THE MIND MUSEUMFort Bonifacio, Taguig CityThe Philippines’ first world-class ScienceMuseum. It has 3 levels of display/exhibit areaand training and learning center.Total CFA: 7,595.0 sq.m.Contract Amount: Php 316,360,815.36 (USD30.6M)Commencement Date : September 2010Completion Date: December 2011
TWIN OAKS PLACEShaw Boulevard, Mandaluyong CityA 43-storey residential building with 3 floors of commercialspaces and 5 basement levels of parking area.Its amenities include state-of-the-art fiber optics and wirelessbackbone that will allow the residents to enjoy a host of smartbuilding technologies and conveniences.Total CFA: 68,743.20 sq.m.Contract Amount: Php 1,100,523,828.30 (USD 25.6M)Commencement Date : December 2010Completion Date: April 2014
JOY NOSTALG CENTEROrtigas Center, Pasig CityA 48-level hotel and office building with6 basements.Total CFA: - 80,000 sq.m.Contract Amount: Php 489,160,216.64 (USD11.30M)Commencement Date : July 2007Completion Date: January 2009Methodology:Used structural precast concrete for the slabs andbeams.
EAST OF GALLERIATopaz Road, Ortigas Center, Pasig CityA 45-storey residential Condominium with 2 basements. It has commercial spaces as well as amenities for residents(swimming pool and gymnasium) at the Ground Floor.Total CFA: 35,186.00 sq.m.Contract Amount: Php 422,421,847.72 (USD 9.80M)Commencement Date : November 2008Completion Date: April 2010Methodology:Used structural precast concrete for the exterior walls, slabsand ledges
MDC 100E. Rodriguez Jr. Avenue , Libis, Quezon CityA 33-storey office building with 5 basement levels.A revolving restaurant sits on its topmost floor.Total CFA: 103,210.0 sq.m.Contract Amount: Php 745,966,011.81 (USD 17.0M)Commencement Date : February 2009Completion Date: March 2011Used structural precast concrete for the slabs.
GATEWAY RESIDENCEPioneer Street cor. Robinson Road, MandaluyongCityA 33-storey residential Condominium with 2basements.It consist of 331 residential units.Total CFA: 43,515.00 sq.m.Contract Amount: Php 399,300,000.00 (USD 9.3M)Commencement Date : June 2010Completion Date: July 2012
Mega Manila: Outlook Towards a More Balanced Development• Private sector is pushing for infra development – Local banks have CASH: USD 43.5 B net savings (>20% of GDP) – Local contractors have technical capacity at cheaper (<30-50%) cost• Developmental Governance – Initiatives of Philippine Constructors Association (PCA) • PPP Coalition • Construction Industry Authority of the Philippines • Improvement of Education for Construction Professionals
Excess Liquidity in the Economy40,0035,00 Savings30,0025,00 Kept at Central20,00 Bank15,0010,00 Investment 5,00 0,00 1982q1 1984q1 1986q1 1988q1 1990q1 1992q1 1994q1 1996q1 1998q1 2000q1 2002q1 2004q1 2006q1 2008q1 2010q1Source: Raw data from NSCB
Unutilized Money in Philippine Central Bank’s Vault 40 000 35 000 30 000 25 000 SDA 20 000USD M 15 000 RRP 10 000 5 000 0 2007 2008 2009 2010 2011 Total of 43.5 B USD Source: Bangko Sentral ng Pilipinas
Philippine Contractors’ Technical Capacity• Urban Spaces and Development• Transportation and Telecommunications• Engineering and Industrial Infrastructure• Institutional Buildings
Urban Spaces and DevelopmentTOP-DOWN CONSTRUCTION DISCOVERY PRIMEA SUITESCase Study: PROJECT MAKATI CITY, PHILIPPINESDATEM DISCOVERY PRIMEA SUITES IS A 67-STOREYConstruction RESIDENTIAL BUILDING WITH 6 BASEMENTS. CONSTRUCTION WAS STARTED IN SEPTEMBER 21, 2009 AND WILL BE COMPLETED ON DECEMBER 28, 2013.
TOP-DOWN CONSTRUCTIONDISCOVERY PRIMEA SUITESAYALA AVENUE, MAKATI CITY, PHILIPPINES DISCOVERY PRIMEA SUITES IS ADJACENT TO AN EXISTING 28-LEVEL RESIDENTIAL BUILDING, “THE MAKATI TUSCANY” THE MAKATI TUSCANY DISCOVERY PRIMEA BUILDING SUITES
Philippine Constructors AssociationPrivate Sector-Led Infrastructure Development Initiatives
Philippine Constructors AssociationA trade organization composed of licensed construction contractors,construction materials, equipment and service providers and other tradeorganizations allied to the construction industry.PCA members handle an average of 80% of the annual construction turnover ofthe Philippines.Recognized as the “voice of the construction industry”, among the PCA’sadvocacies are: – Construction safety – Manpower training and development – The creation of a level playing field in the construction arena, especially in dealing with foreign contractors.The PCA is also represented in a number of government bodies tasked withpolicy formulation and implementation. It is the founder of the InternationalFederation of Asian and Western Pacific Contractors’ Association (IFAWPCA)and a regular member of the ASEAN Constructors Federation (ACF) and theConfederation of International Constructors Association (CICA).
PCA Development Projects• Crafted the Construction Industry Roadmap that included three pillars for development.• Current implementation of the three pillars
The Three Pillars of the Construction Industry Roadmap1. The Strengthening of the Construction Industry Authority of the Philippines (CIAP); and2. The Enhancement of Education of Construction Professionals and Upgrading of Skills Standards of Construction Workers3. The Promotion of PPP as the main engine for infrastructure development in the country;
Construction Industry Authority of the Philippines (CIAP)• primary task to promote, accelerate, and regulate the growth and development of the construction industry in conformity with national goals• To strengthen: – must be lead by competent and industry-immersed officers – Restructure towards a common vision, realigning the vision of each board to match with the overall vision of CIAP• Reviewing and clarifying the functions of the different construction regulatory bodies
Enhancement of Education of ConstructionProfessionals and Upgrading of Skills Standards of Construction Workers• Devise learning programs and offer financial assistance for education.• Enhance elementary and secondary education• Develop and implement a globally competitive and internationally recognized engineering curriculum, in concurrence with the ongoing application for Philippine membership to the Washington Accord• Strengthen industry-academe linkages• Revitalize the Construction Manpower Development Foundation (CMDF) as a pilot center for trainers’ training.
PPP Coalition• PPP Coalition consists of private sector associations committed to: – the promotion of BOT/PPP Framework in infrastructure development – assist the Government in promoting PPP Coalition Members good governance through an open, Left to Right: REID President Enrico Basilio; PCA President Levy Espiritu; PCA Foundation President Roger transparent and competitive Murga; BAP President Gigi Montinola; IHAP President Raul Leopando process for PPPs – assist the Government in PCA Foundation jumpstarting few PPP Infra Projects – assist the Government in pushing for policy reforms
Promotion of Open, Transparent and Competitive Process“If we are truly interested in a square deal for all, then what we shake handson, should be what endures. To this end, what we will be doing in so far assolicited projects are concerned, is to minimize your risk in a meaningfuland fair manner.” President Aquino“For PPP projects, the government will focus on the solicited mode. Priorityprojects identified in the MTPDP/MTPIP and CIIP will undergo the solicitedmode and will be processed within 6 months.” Press statement of Socio-Economic Planning Secretary Paderanga
PPP PROJECTS FOR 2012 ROLL- OUTSchool Light RailsClassrooms • LRT Line 2 Ext• Nationwide • LRT 1 South coverage Extension• Pilot in 3 regions Airports • Clark BTToll Roads • New Legaspi• NLEX-SLEX (Daraga) Connector • Puerto• NAIA Princesa Expressway • New Bohol2 Airport• Daang Hari- • Laguindingan SLEX Link• CALA Expressway
Conclusion• Megacities are the future of the world.• Balanced development of infrastructure and governance must be emphasized to ensure inclusive and sustainable growth.• Our case in Mega Manila demonstrated the possibility of a private sector-led development• The private sector associations (e.g. PCA) have a role in supporting their government agencies in their developmental and regulatory functions. – Strengthening the industry authority – Public-Private Partnership (PPP) Program in infrastructure development
Annex• Details on Infrastructure Performance• Details of the PPP Initiatives