Audit predicts that cost of scrapping the project will prove higher than building it
Canceling the new Mexico City international airport project at Texcoco, México state, will cost almost 332 billion pesos (US $16 billion), according to the Federal Auditor’s Office (ASF), an estimate more than three times higher than that of the federal government.
The previous government’s partially built airport was canceled by President López Obrador following a legally questionable public consultation in October 2018 that found almost 70% support for scrapping it in favor of converting the Santa Lucía Air Force base into a commercial airport and upgrading the existing airports in Mexico City and Toluca, México state.
According to the ASF’s estimate, canceling the Texcoco project will be slightly more expensive than building the facility, which had a projected price tag of $15 billion, although the current government says it would have cost more.
In a document submitted to the surveillance committee of the lower house of Congress, the ASF said it had determined that the total cost of canceling construction of the airport will be 331.99 billion pesos.
It noted that its estimated cancellation cost is higher than the 100-billion-peso estimate outlined by the Ministry of Communications and Transportation in a 2019 document.
The ASF said the cost could be even higher than its projection due to higher than anticipated contract liquidation expenses and higher than expected costs related to legal action against the decision to scrap the project, which López Obrador long argued was corrupt, too expensive and being built on land that was sinking.
It explained that 49.3% of the estimated cancellation cost is comprised of non-recoverable investment expenses, advance settlement of contracts, expenses related to terminating the project’s financing scheme and anticipated legal costs.
The remaining 50.7% consists of liquidating airport bonds, settling contracts currently in the process of termination and paying costs related to current legal action against the cancellation decision.
López Obrador unsurprisingly rejected the ASF’s estimated cancellation cost at his news conference on Monday morning, claiming that the figure is “exaggerated.”
“I would like them to explain that piece of information, which is wrong – it’s exaggerated,” he said.
“… I have other information and it will be presented here. … Those from the Federal Auditor’s Office are providing wrong information for our adversaries and I believe that they shouldn’t lend themselves to these [disinformation]campaigns.”
Source: Infobae (sp)