DIA, a Burden to Government?

December 1, 2003
Mindanao Times News - Philippines

DIA, A Burden to Government?

The P4.9 billion Davao International Airport (DIA), set to be opened today,
is expected to become a liability to the national government in the next few
years unless traffic improves. “We don’t expect the airport to earn in the
next few years,” said Department of Transportation and Communications
Assistant Secretary Robert Castañares. 

Castañares said the traffic at the airport is not enough to make it
self-sustaining and pay its P80 million annual obligation to the Asian
Development Bank and the European International Bank, the funding agencies
in building the new airport. 

So the national government has to shoulder the loan repayment because it was
the party when the loan was obtained from the two international funding
agencies, he said. He added that the interest rate on the loan, a variable,
ranges between two and three percent annually. 

At present there are two proposals in Congress which will affect the DIA
operations if any is approved. One proposal is the creation for the DIA
Authority (DIAA), the agency that will be tasked to run it. 

If the DIAA is formed, the national government will relinquish its
supervision in running the airport to the authority, including the
obligation of paying the loan, Castañares added. 

Another proposal is the creation of the Civil Aeronautics Authority (CAA),
the agency that will be tasked to operate all public airports in the
country. Castañares said the new agency will be under the direction of the
national government. 

Frederick San Felix, DIA manager, said his office will also increase fees
for the sustainability in running the airport. Among the fees to be
increased is the terminal fee which will balloon from P40 to P100 a
passenger. 

San Felix justified the planned increase, saying the new facilities of the
airport and the convenience of the passengers are enough for them to pay
more. He added that a feasibility study on increasing the fees has already
been started. 

Councilor Emmanuel Galicia said there is already a group tasked to study how
to increase the traffic in the airport. Galicia said the group will come up
with a comprehensive plan that will address the issue. 

Earlier, another councilor, Peter Laviña, proposed to the national
government to declare the airport an area for “pocket open skies.” Under
this policy, foreign airlines can freely bring in or pick up passengers to
and from their places of origin. 

Unlike in the “open skies policy,” the “pocket open skies policy” does not
require a country to country air negotiation because airlines are free to
look at the destination whether servicing it is a viable proposition. 

Laviña said this is needed in order to develop tourism between the Davao
Region and the rest of the world. He said what must be considered is
bringing in tourists from the Asian region considering that movement of
people from the areas within the region seemed to have heightened


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