3 big-ticket railway projects in limbo but will push through, says DOTr
MANILA -The three big-ticket regional railway projects—whose loan applications to China were withdrawn due to the latter’s inaction —have remained in limbo as their costs escalate due to delays, the Department of Transportation (DOTr) said.
The government—led by the National Economic Development Authority (NEDA)—is now determining the new costs of these infrastructure projects before finding another source of financing, Transportation Secretary Jaime Bautista said.
These projects are the P142-billion South Long Haul project in Bicol, P50-billion Subic-Clark Railway project (SCRP) and the P36-billion first phase of the Mindanao Railway Project (MRP).
Bautista said the mega-railway projects will likely be financed either through official development assistance (ODA) or under the public-private partnership (PPP) framework. “But the right of way is not covered by ODAs, so it will likely be shouldered by the government,” he added.
“For us to be able to continue the project, we would need to get the approval from the Neda for the increase of the project costs,” Bautista said on the sidelines of an event in Makati on Wednesday.
The transport chief said the project estimates—which were made based on the previous administration’s planning—must be updated as the costs of materials and labor have likely increased.
A potential funding source is the Japan International Cooperation Agency (Jica), which is a partner of the DOTr in crafting the 30-year rail master plan covering the National Capital Region, Central Luzon and Calabarzon. Other possible sources of funding are the World Bank and Asian Development Bank.
Asked when the loans will be finalized, Bautista said they were not sure yet, putting the projects on hold for a longer time.
Earlier, the DOTr backed out of its protracted loan negotiations with China Export Import Bank (Eximbank) as the latter failed to give a decision on the matter.
The railway projects, despite the delays, would still push through as these are part of the Marcos administration’s flagship infrastructure projects, he added.
These projects were originally scheduled to start operations within 2024 to 2025.
South Long Haul project is a 380-kilometer (km) railway linking Calamba, Laguna to Daraga, Albay while SCRP is a 71.13-km link between Subic Bay Freeport Zone and Clark Freeport Zone and would transport both freight and passengers. MRP’s first phase covers the 102-km Tagum-Davao-Digos route and is envisioned to be the first rail line across Mindanao.
In January last year, the contract for the Bicol project was awarded to the joint venture of China Railway Group Ltd., China Railway No. 3 Engineering Group Co. Ltd., and China Railway Engineering Consulting Group Co. Ltd.
The contract for the construction of the SCRP was earlier awarded to China Harbour Engineering Co. in December 2020.
However, the Tagum-Davao-Digos segment of the Mindanao project failed to proceed after China was unable to submit a shortlist of contractors for its design-build contract.
More railway projects
The government has been lining up railway projects, which are seen to decongest road traffic and facilitate quicker passenger movement.
Recently, Bautista told reporters they were seeking the expertise of International Finance Corp. in crafting the implementation strategies for Metro Rail Transit (MRT) Line 10, MRT 11 and Light Rail Transit (LRT) Line 6.
The P112.26-billion MRT 10 is a 22.5-km railway with 16 stations linked at MRT 7, which is under development. Its alignment is along circumferential road C-5 connecting the Ninoy Aquino Terminal Airport Terminal 3 to Quezon City.
The P81.79-billion MRT 11 project is an 18-km elevated rail line starting from EDSA Balintawak in Quezon City traversing along Quirino Highway in Novaliches, onto Zabarte Road in North Caloocan and all the way to San Jose del Monte, Bulacan.
LRT 6, which has a price tag of P73.24 billion, is a 23.5-km light rail transit system extending LRT 1 further to Cavite cities, including Bacoor, Imus and Dasmariñas.
Other major projects include the Metro Manila Subway and the North-South Commuter Railway.
“The mission is clear: to make the Philippine transportation system comfortable, accessible, safe, sustainable and affordable for everyone,” Bautista said.