The Davao City Council would be inviting key officials of government offices involved in the P17 billion Sasa Wharf Modernization Project, which has raised suspicion of over-pricing.
This is for clarity not an investigation to clear the issue, said Councilor Danilo Dayanghirang.
During privilege hour of the May 5 session of the city council, Dayanghirang delivered a privilege speech picking up reports in media about the project to be implemented by the Phippine Ports Authority (PPA).
Although he touched mildly on reports that there could be overpricing, Dayanghirang said the local government should be interested in the project as it involves relocation of informal settlers inside the wharf. Dayanghirang passed a resolution inviting officials of the PPA, the National Economic Development Authority, the Department of Transportation and Communication and the Davao City Planning Office, among others, to the next session of the city council.
In an earlier report in a national paper, Dayanghirang said the high cost of the project could impact on the local economy in terms of higher port charges.
The ‘stink’ in the alleged overpricing in the modernization project will most likely be investigated by Congress, according to Peter lavina, a former member of the Davao City Council, in a report in a national paper.
The P17 billion project is funded by DOTC with fund sourced from a World Bank loan and will be implemented by the PPA.
From the original study of P4 billion the new price tag for the Sasa Wharf expansion is now P17 billion, according to Lavina.
The overprice will most likely reach Congress for investigation, he said.
Media reports on the alleged anomaly apparently is behind an emergency meeting called by DOTC and PPA with aim to clear up the controversy.
In a Facebook post (May5), Lavina wrote: “I just received word that officials from the Department of Transportation and Communication (DOTC) and the Philippine Ports Authority (PPA) are arriving today in Davao and will hold a meeting at Park Inn Hotel at SM Lanang.”
In his privilege speech, Dayanghirang said he was informed that media was barred from the meeting.
“I hope they issue a statement to clarify the overprice of the Sasa Port PPP project. There is now a growing opposition to the project that it will likely reach Congress for investigation,” Lavina said in the report.
Lavina said the high cost of the project has raised suspicion in the ports building industry, including the International Container Services Inc. (ICTSI). Known worldwide, the Filipino company builds container ports and runs operation of port facilities in several countries.
“No less than ICTSI of Enrique Razon, the country’s largest port operator, questioned the huge project cost,” Lavina said.
Suspicion of alleged irregularities in the project cost has also caught the eye of Dayanfhirang who put to task the DOTC and PPA for the high cost.
“The DoTC had undercut, ignored, and totally undermined the study done by its own agency, the Philippine Ports Authority (PPA), to favor a much costlier proposal by a foreign consultancy group under the World Bank,” City Councilor Danilo C. Dayanghirang said in a report in BusinessWorld.
Suspicion on alleged overpricing can be seen in the comparative cost of other ports development projects in the Davao Guif, according to Lavina, the first to write about the apparent anomaly in the Sasa port project.
“(The Sasa Port Modernization Project) is more than four times the project cost based on the PPA study and three times the cost of the redevelopment of the Hijo Port in Tagum, Davao del Norte, which is pegged at P5.7 billion,” Lavina said also in the BusinessWorld report, further saying that the Davao International Container Terminal (DICT) of San Vicente Terminal and Brokerage Services, Inc. in Panabo City, also in Davao del Norte province, only cost P2.65 billion.
“DOTC should postpone the bidding and re-evaluate the Sasa Port project if it is still feasible. Cargo at the Sasa Port has been reduced in the past years because of the presence of the private ports that it may no longer be feasible given the huge amount it will entail to build it,” Lavina said in the BusinessWorld report.
The NEDA Region 11 office reported that cargo throughput in Sasa Port dropped by 42% to 2.85 million metric tons (MT) as of the third quarter of 2014 from 4.89 million MT a year earlier.
“The cargo throughput is only 31.9% of its 2014 target of 8.92 million metric tons,” said Maria Lourdes D. Lim, Director of NEDA-11. She said only 545 vessels called at Sasa during the third quarter of 2014, down 36% year on year and 1,691 vessels short of target.