4 MIN READ
NORTHERN DISPATCH
www.nordis.net
There is, in fact, a chilling connection between Public-Private Partnerships (PPP) and similar hybrid privatization schemes in railways and other mass transportation, on the one hand, and public markets on the other. Both are critical public services that promise to become lucrative profit centers if “properly managed”. This “if” has been turning out to be a big WTF for the wider public.
This connection is not coincidental. It is the cold-blooded result of the so-called “New Public Management” (NPM) and “Reinventing Government” doctrines introduced by neoliberal think tanks in the late 1980s and 1990s.
It was an attempt to refine the original, yet increasingly problematic and discredited models of outright privatization and deregulation. These approaches promoted that public services should adopt private sector management practices to enhance efficiency and make public services more business-like.
Applied to Philippine local governments, this framework focused on four public services that relied heavily on infrastructure facilities: public markets, slaughterhouses, integrated bus terminals, and commercial centers.
These mirror public experiences in several PPP initiatives in the Philippines, such as the Metro Rail Transit, which has faced criticism over fares and service reliability. Another was the Tutuban Center in Divisoria, Manila, which opened in 1993. This was soon followed by the mallification of other public markets in Manila, such as the historic Quinta Market and the Paco Market.
The redevelopment of public markets nationwide has become a test of how local governments should modernize essential infrastructure without weakening public control. At the center of the debate is the PPP scheme, which many local governments have opted to take. Advocates view PPPs as a strategic tool to enhance government-private sector collaboration in delivering public services and developing infrastructure.
However, critics, such as the Ibon Foundation, have long argued that this amounts to privatization with additional benefits for corporate investors. It enables companies to generate revenue while governments assume the risks and costs. These can redirect public funds to private firms, influence government priorities, and weaken public oversight of development projects.
After two decades, policy planners are now seeing not the shining success, but miserable failures, as revealed in a 2021 study of five PPP-public market cases published in the Journal of Public Administration and Governance (JPAG).
“Contrary to the expected results, the study showed that PPP/BOT public markets failed to address the perennial problems of public markets in the Philippines,” the research concluded.
It noted that while it provided LGUs with infrastructures, it failed to resolve the issues for several reasons, including “the shift of project proponent’s interest from managing and operating public markets to the operation of commercial shopping centers…”.
Instead of serving small market enterprises, the study noted, the facilities became trade centers for large and influential businesses, including foreign ones, under the Retail Trade Liberalization Act of 2000. The conversion of public markets into so-called “market malls,” the study explained, “placed local market vendors at the disadvantage because of the difficulty in competing with gigantic franchise holders and retail trade corporations.”
An earlier 2018 report from the European Public Service Union and the European Network on Debt and Development noted that PPPs “often come at a high cost for the public purse and citizens, an excessive level of risk for the public sector, and have a negative impact on democratic governance.” Based on seven global case studies, it showed that “impacts have risked compromising the fulfillment of fundamental rights, and undermining the fight against inequalities and climate change.”
In Baguio, vendors, residents, and groups opposing a corporate-led redevelopment of the city’s Public Market under a PPP have consistently voiced these concerns. These worries are strengthened by facts from recent city council deliberations, which show: 1) the original proponent, SM Prime Holdings Inc., will control nearly 48% of the project area; 2) some expenses are considered advance rental payments for a 50-year lease; 3) the draft contract lacks a non-compete clause to stop the proponent from competing with market vendors.
City officials have prioritized rehabilitation, and vendors and residents agree that the market needs structural improvements and better management. However, authorities appear to be failing to strike a balance between these objectives and the interests of vendors, consumers, and the broader community.
Redevelopment will require temporary relocation, but current plans do not appear to guarantee adequate space or fair return terms. Vendor groups warn that many operate on thin margins and cannot withstand prolonged disruptions. They also argue that a large commercial center attached to the project could disadvantage enterprises that form the market’s core identity.
These risks are heightened by limited public access to information, as the confidentiality clause has restricted public review of several provisions. Decisions affecting public property for decades should not proceed without full disclosure. The City Council must find a way to enable public scrutiny of these sections. Consultations should be regular and meaningfully reflected in final plans.
The market’s cultural value also deserves attention. Redevelopment can improve hygiene and safety, but design should remain responsive to the community’s social and economic needs.
Financial capability is a constraint, but the city should explore alternative funding models that are inclusive and preserve public control, even if they do not match private investment. Vendor associations and cooperatives have consistently expressed their willingness to collaborate, and those opposing “mallification” have supported this.
LGUs have a duty to protect public assets, and officials must decide not only on the basis of cost and aesthetics, nor just on short-term financial gains, but primarily on the long-term economic impact on the community. This is both a practical responsibility and a civic obligation.
Certainly, the redevelopment of the Baguio Public Market must proceed. However, it should not come at the expense of the people, nor allow big business interests in the central business district to grow unchecked. In the long run, this could concentrate commercial power, limit competition, and reduce opportunities for local entrepreneurs.
It must evolve to reflect the needs of its people, preserve its heritage, and maintain public control over essential services. Calls to oppose its “mallification” and the corporate-led PPP scheme are a critique of misplaced priorities and skewed development views, grounded in concrete examples.
In a nationwide context, public markets have experienced long-term underinvestment and structural decline. The persistence of illegal subleasing and limited support systems are product of governance failures, deep-seated graft, and widespread corruption, worsened by the government’s ongoing commitment to neoliberal economic policies. #nordis.net
