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NorthRail project delayed anew

DoTC holds off talks with Beijing




01:50 AM February 27th, 2012

By: Paolo G. Montecillo, February 27th, 2012 01:50 AM

MANILA, Philippines—The controversial NorthRail project faces more delays after the government has decided to hold off any negotiations with the contract’s Chinese proponents due to the prevailing political landscape in Beijing.

To insulate the Philippines from any sudden policy shifts in Beijing, the Department of Transportation and Communications (DoTC) said it would postpone discussions until China’s leadership change is completed.

DoTC Secretary Manuel Roxas II said newly installed Chinese Ambassador to the Philippines Ma Keqing wanted to schedule a trip to Beijing in the middle of the year.

“We had a very productive talk, and they are trying to schedule a visit to China. We wanted to find out the next steps for the project,” Roxas said. “But the fact is, the Chinese leadership is going through changes. They want to meet with us earlier but we don’t want our projects to be disrupted because of that.”

Late last year, the DoTC submitted major revisions to the NorthRail project. Under the proposed new contract, the Philippine government will write the terms of reference to ensure that the contractor has the capability and track record to carry out the rail project.

The new project will contain an entirely new train section that will connect the Makati central business district to Caloocan, a 12-kilometer distance. The second phase will link Mabalacat in Pampanga to Clark airport, another 15-kilometer distance.

The project, to be funded with a concessional loan from the Chinese Export Import Credit Agency, involves the construction of a train line connecting Metro Manila to the Diosdado Macapagal International Airport and other provinces in Northern Luzon for $1.2 billion.

But construction has been delayed. The deadline to complete the first phase was moved from 2007 to 2013, and the total cost estimate has ballooned to $1.8 billion.

The DoTC likewise noted that the project’s Chinese contractor, Sinomach, had asked for more money for construction, despite the reduction of the project’s scale.

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