By BERNIE C. MAGKILAT
Manila Bulletin

The Cagayan Economic Zone Authority (CEZA) and a consortium of private sector groups are investing P11 billion for the construction of infrastructure projects particularly an international airport and seaport to jumpstart the development of the Cagayan Special Economic Zone and Freeport in Santa Ana, Cagayan.

CEZA administrator and CEO Jose Mari Ponce said they are looking at the completion of all the infrastructure facilities by 2010.

Of the total investment requirement, Ponce said between P5 billion to P6 billion would be used to for the construction of the international airport and P4 billion to P5 billion for the construction of the container port.

The funding for the international airport would be a combination of its own budgetary allocation from the national government and the private sector consortium led by the First Cagayan Leisure and Resort Corp., CEZA’s Internet casino master licensor, of businessman Alfredo Benitez group. They are eyeing an equity sharing of 60-40 in favor of CEZA.

Spanish-owned Banco Bilbao is also providing a 350-million euro open credit line that can be tapped for the airport project and to fund expansion projects of CEZA locators.

The Banco Bilbao, however, requires a sovereign guarantee for the loans from PhilExim bank.

“It is a priority for CEZA to build the airport this year,” said Ponce, as he cited the rapid development of the Cagayan Special Economic Zone and Freeport.

He said the airport will have a runway of 1,500 meters to 2,000 meters to accommodate large aircraft filled with tourists and investors. The runway alone entails P2 billion in investments. Construction of the airport is expected to start this year in a 30-hectare privately-owned lot in Sta. Ana and is expected to be operational by 2009.

Ponce said the international airport will support the vision of CEZA to transform the economic zone and Freeport into a first-class tourist destination and a major transshipment point for trade in the Asia-Pacific rim, competing with the like of Hong Kong and Singapore.

The international airport will be complemented by various infrastructure and information technology projects that will solidify the position of the Freeport and economic zone as a tourism and investment destination.

While the international airport is under development, CEZA has developed the San Vicente airstrip to accommodate smaller chartered flights from Manila. Under a joint use agreement with the Philippine Navy, CEZA finalized the widening of the airstrip and started utilizing the facility since last year.

Larger aircraft are also using the Tuguegarao airport which presently caters to international chartered flights to and from Macau, and has a frequency of two flights per week to bring tourists to Sta. Ana while the CEZA international airport remains to be completed, Ponce added. Tuguegarao is 150 kilometers away from Sta. Ana.

On the other hand, Port Irene, the center of the Freeport zone, is being developed into a major transshipment hub of international standards for a total cost of P5 billion.

The port’s existing pier will be rehabilitated and lengthened to accommodate 20,00 deadweight tons vessels while the 7-hectare port area shall be developed into a container year with a capacity of 17,000 twenty-foot equivalent units (TEUs).

The development of the port will come in two phases, the construction of breakwater to protect the port from strong currents and waves, and the lengthening of the pier and development of the container yard.

The development of the seaport would be undertaken on a build-operate transfer scheme by the ASEAN Pacific International Terminals Inc., which is now owned by Filipino-owned Burgundy Group of Co.

“The goal is by 2010 all the infrastructure facilities are already operational including additional power capacity, roads and bridges,” Ponce said.

Ponce said road development is ongoing to facilitate more investments related to eco-tourism projects. Other projects including waste and sewerage system, and waste disposal facilities are ready for implementation.

Ponce explained that when he took over CEZA in 2005, he ordered a shift in focus in the implementation of priority projects from transshipment port and agro-industrial strategy to eco-tourism.

Ponce has decided to push the development of eco-tourism first because there is already the demand for tourists and casino players from nearby countries particularly Macau, Taipei, China, Japan and Korea.

On the other hand, based on his study the transshipment and agroidnsutrial strategy can only become viable by 2012 yet.

Ponce’s move to prioritize eco-tourism has born fruit with the establishment of two major casinoresort complexes Macaubased Sun City and Xiamen-based Eastern Hawaii, built at a cost of nearly P1 billion, which is currently under expansion to provide a total of 600 rooms for foreign guests from the current 400 room capacity.

This has facilitated more tourist arrivals on the average of 200 a month via chartered international flights. In December last year, there were 300 tourists that came into Sta. Ana. The zone has also an available 400 hotel rooms.

The zone has been declared as Asia’s first and only interactive gaming jurisdiction by the International Association of Gaming Resources.

First Cagayan is also developing a ten-hectare cyber complex at a cost of P800 million, which will house a world-class, state-of the-art data center facility.

Ponce said that First Cagayan has invested heavily in telecommunications to provide the needs of investors. It has already completed the installation of microwave facilities connecting Aparri to Sta. Ana and the installation of an 85-kilometer fiber optic cabling facility from Lallo to Sta. Ana.

Through this fiber network, the Zone is interconnected to major telcos and can now offer high-capacity internet connectivity at competitive costs, ideal for various businesses such as offshore banking, call centers and other BPO ventures.

Now that the demand has been established in the Freeport, Ponce said they are now laying down the infrastructure projects to accommodate increased tourist arrivals and increased trade volume as transshipment hub.(BCM)