The Philippines’ Department of Transportation and Communications and the Japan International Cooperation Agency signed on November 7, 2015, the Loan Agreement for the North-South Commuter Railway Project, running from Malolos, Bulacan to Tutuban, Manila.
The project will support the expansion of a mass transportation network, which is recognized as one of the priorities in the 2011-2016 Philippine Development Plan (PDP).
The project aims to improve the efficiency of land transportation capacity of Metro Manila.
It also seeks to provide a more environmentally sustainable mode of transport through:
- Construction of about 37km new elevated commuter railway from Malolos, Bulacan to Tutuban, Manila;
- Procurement of rolling stock; and
- Installation of electro-mechanical systems.
The project represents the Phase 1 of the North-South Railway Project (NSRP) of Department of Transportation and Communications.
The Phase 2 of NSRP, on the other hand, involves the construction and rehabilitation of approximately 653km commuter railway operations from Tutuban to Calamba.
Phase 2 also includes the long haul rail operations on the branch line from Calamba and Batangas and extension from Legaspi, Albay to Matnog, Sorsogon.
This is being proposed to be implemented via Public-Private Partnership (PPP) arrangement.
In signing the loan agreement, Department of Finance Secretary Purisima said: “In 2010, the ADB estimated that the Philippines has $127 billion in infrastructure needs until 2020, equivalent to around 6.1% of GDP per year. Obviously in this respect we’ve got a lot of catching up to do—for the longest time, in the years 1983-2000, average infrastructure expenditures as a percentage of GDP was kept at 2%.”
“So while in 5 years, the continued expansion of our fiscal space allowed us to ramp up infrastructure spending by 245.4% and to finally match it with 5% of GDP with our 2016 budget, we still appreciate development partners marching in lockstep with us on our priorities,” Purisima said.
“Japan is one of our strongest development partners in the world, with total ODA in loans and grants given to the Philippines second only to the World Bank,” Purisima added.
“Infrastructure projects are sometimes not financially viable but are very economically desirable– the cheapest sources of financing are thus given premium. Thus, we thank the government and people of Japan for the faith they have put in our economic partnership and for the investment they have put in our future,” Purisima said.
JICA Philippines Chief Representative Noriaki Niwa said: “Traffic congestion is a clear and immediate challenge that can affect a country’s economic competitiveness.”
“It’s timely for the Philippines to start its railway projects to ease traffic and improve mobility of logistics and ordinary commuters<” Niwa said.
“The Philippines’ transit lines of LRT/MRT extend to about 50 kilometers versus cities like Tokyo which has 300 kilometers subway network. By helping develop Metro Manila’s mass transit system, we can expand growth and develop surrounding cities,” Niwa said.
The Project also includes the procurement of 104 cars and the installation of electro-mechanical systems.
The railway will boast of aseismatic design technology used for earthquake-resilient structures, earthquake detection systems, corrosion-resistant steel, as well as signaling and communications systems for punctual and reliable operations.
The loan, amounting to Japanese Yen equivalent of $2 billion, will be the largest scale assistance ever extended by JICA to any country for a single project. (Department of Finance press release)