Editorial: Seeking ‘conventional’ wisdom-A A +A
Tuesday, February 26, 2013
ON this day 10 years ago, the Cebu Provincial Board (PB) approved a P250-million budget for a “megadome” project.
Construction work did not begin until three years later, in 2006, and by then the Province had transformed the project into the far grander Cebu International Convention Center (CICC). Told to get the center ready in time for a Southeast Asian leaders’ summit, the Province’s contractors got the job done in less than one year.
Today, however, questions from the office of Acting Gov. Agnes Magpale have revived concerns about whether local governments should be in the business of building and running convention centers—or whether it should leave that up to the private sector.
It turns out that in the last two years, the CICC has earned less than what the Province spent to operate it. In 2012, the deficit stretched nearly P8 million.
The acting governor has reason to be concerned about whether the CICC is proving to be a feasible project. Three weeks ago, the Court of Appeals upheld a trial court’s decision ordering the Province to pay a contractor an additional P257.4 million for extra work done on the facility.
But it’s not enough to assess the CICC on its earnings alone.
One must consider the number of entrepreneurs whose businesses have grown after they joined exhibitions hosted in the CICC, which gave them the chance to reach more buyers faster. One must also consider how much money, if any, the Province has saved its towns, cities and local officials’ federations, who otherwise would have had to pay more to hold their activities in privately-operated spaces.
One can even consider the CICC as one of the Province’s contributions to the effort to help Cebu attract a larger share of the business events traffic.
The Province has commissioned a private company, Petco, to manage the CICC and go after more Mice—that is, meetings, incentives, conventions and exhibitions. But it may need to tap more expertise from the private sector, such as organizers of Mice events, for creative ideas to improve the CICC’s bottom line.
More transparency from the CICC’s managers wouldn’t hurt. What factors kept the facility from earning at least enough to break even in the last two years? How can these be corrected?
Published in the Sun.Star Cebu newspaper on February 27, 2013.