On Tuesday in the Philippines, a public-private partnership (PPP) concession agreement worth 12.75 billion Philippine pesos (US$219 million) was signed, allowing Aboitiz InfraCapital (AIC), the infrastructure arm of the Aboitiz Group, to take control of Laguindingan International Airport (CGY) in Northern Mindanao for a period of 30 years.

The move will enable the gateway to increase traffic from its current 1.6 million passengers to 3.9 million in Phase 1, and 6.3 million in Phase 2 by boosting international travel to and from the gateway.

In a press conference moderated by Presidential Communications Officer Daphne Oseña-Paez, Department of Transportation (DOTr) Secretary Jaime Bautista said: “Today is a significant milestone in our endeavour to improve air connectivity. With the signing of this concession agreement we expect Laguindingan’s transformation after Aboitiz InfraCapital takes over the airport operations and maintenance.”

Since its opening in 2013, CGY has served as the key gateway to the northern part of Mindanao. Across the island, it is second-busiest airport after Francisco Bangoy International Airport (DVO) in Davao City which is also up for privatization.

The PPP signing for CGY comes after September’s successful handover of Ninoy Aquino International Airport (MNL), the Philippines’ biggest gateway, to the San Miguel-led New NAIA Infrastructure Corporation as its concessionaire. The secretary said these deals “form part of our program of airport upgrades and expansion while enhancing passenger experience.”

He added: “Like other airport development projects, Laguindingan’s transformation should promote regional growth, generate jobs, and create investment opportunities. It highlights the immense potential of PPPs in driving innovation and infrastructure development. The partnership with Aboitiz InfraCapital not only taps private sector expertise but also ensures the delivery of quality public services.”

The project came about with the help of the International Financial Corporation (IFC) of the World Bank Group which provided the government with advisory services on the best way to privatize CGY.

More Privatizations Coming

Also on the panel, DOTr Undersecretary for Aviation and Airports Roberto Lim commented: “Our PPP program is a cornerstone of government policy as a strategy to accelerate the infrastructure development of airports and other sectors.

“This clear policy—supported by the implementing agencies such as DOTr, in partnership with the PPP Center and other relevant agencies—has been able to fast-track these projects that will bring connectivity, trade, and commerce to our archipelagic nation. We expect to have more before the end of the year, and additional projects for 2025.”

Civil Aviation Authority of the Philippines (CAAP) Director General Capt. Manuel Antonio Lara Tamayo added: “This is a milestone for CAAP as the regulator of so many airports in the country. With the PPPs, operations of airports will gradually be moved out of CAAP so that we can concentrate on our primary mission of regulation and safety.”

Nevertheless, CAAP will partner with new concessionaires in expanding route networks to restore regional and/or international flights to CGY and other airports. For CGY specifically, Tamayo raised hopes that it will eventually be able to serve wide-body aircraft, although “at this point in time, single-aisle aircraft are sufficient,” he noted.

Under the deal with AIC, the passenger terminal will be renovated and expanded with modern equipment also boosting operational efficiency and raising overall standards at CGY. AIC Vice President and Head of Airports Business Rafael M. Aboitiz, said: “We see potential in international flights and want to work closely with the airlines in realizing this dream. We will also work with tourism stakeholders to see how we can develop a longer-term roadmap.”

Earlier today, AIC also announced it had taken full ownership of Aboitiz GMR Megawide Cebu Airport Corporation (AGMCAC), the developer and operator of Mactan-Cebu International Airport (CEB). “Completing the acquisition of AGMCAC is a significant step forward in our vision to enhance the Philippines’ airport infrastructure. With full ownership of AGMCAC, we are committed to taking the airport to new heights and cementing its status as a world-class gateway,” said Cosette V. Canilao, AIC President and CEO.