The Philippines and Japan have sealed two loan agreements for projects amounting to P98.69 billion combined, one of which aims to improve flood control management in Metro Manila, and the other to seamlessly integrate a three-way commuter rail system linking this premier urban hub to the major provinces of Laguna, Pampanga and Bulacan.
Finance Secretary Carlos Dominguez III and Shigenori Ogawa, the director-general of the Japan International Cooperation Agency (JICA), signed on Monday the agreement providing the Philippines with a P80.47-billion loan (approximately JPY167.199 billion), which represents the first tranche of Japan’s total commitment in providing funding support for the North-South Commuter Railway (NSCR) Extension Project.
Dominguez and Ogawa also inked the P18.22-billion loan accord (about JPY37.9 billion) for the fourth phase of the Pasig-Marikina River Channel Improvement Project.
Following the signing ceremony at the Department of Finance (DOF) central office in Manila, Dominguez underscored anew the positive results of the “fast and sure” approach adopted by the Philippines under President Duterte and Japan under Prime Minister Shinzo Abe, as he pointed out that the two projects were processed in a record time of two months, after the Board of the National Economic and Development Authority (NEDA) approved them last November.
“This is, by far, the fastest loan processing time in the history of Philippines-Japan bilateral cooperation. We would like to share the credit here with our counterparties, who espoused the same sense of urgency and trusted our commitment to get these projects done,” Dominguez said.
He also thanked the Japanese government for its generosity to the Philippines, “the confidence you hold in our ability to undertake” the projects, and “the contagious optimism we share in the future of this great nation.”
“But especially, let me make special mention of JICA because they have stepped up to the plate and are really at the forefront of assisting the Philippines in its ‘Build, Build, Build program,’ ” Dominguez said.
Ogawa, for his part, said “the cooperative relationship between the Philippines and Japan has become stronger year by year and I believe that these projects symbolize such strong ties between (our) two countries and between our people.”
Public Works and Highways Secretary Mark Villar and Transportation Undersecretary Timothy John Batan also thanked the government of Japan for its funding support for the two “Build, Build, Build” projects.
The NSCR Extension Project forms part of the 147-kilometer NSCR System of the Philippine National Railways (PNR), which used to be composed of three separate projects—(1) the 38-kilometer line from Manila to Malolos in Bulacan, which is funded by a JICA loan signed in 2005; (2) the 53-km line from Malolos, Bulacan to Clark, Pampanga, and (3) the 56-km line from Manila to Calamba, Laguna, which cover today’s loan signing.
With a total cost of P628.42 billion (about JPY1.307 trillion), this high-capacity commuter railway system is the biggest combined project so far to be undertaken under President Duterte’s centerpiece program “Build, Build, Build.”
“The economic benefits of improved mobility for our commuters in this very large urban sprawl will far outweigh the total investment for this project,” Dominguez said.
Co-financed by JICA and the Asian Development Bank (ADB), the total loan financing requirement for the project is estimated at P488 billion.
The loan agreement for the NSCR Extension signed today amounting to P80.47 billion carries an interest rate of 0.1 percent per annum for non-consulting services and 0.01 percent per annum for consulting services. The loan is repayable within 40 years, inclusive of a 12-year grace period.
Dominguez said this commuter rail service is designed to accommodate the anticipated increase in passenger volumes in the future, with a capacity to run 15 trains per hour.
Cutting-edge Japanese technologies–ranging from platform screen doors, signaling, and rolling stocks to flood resilience and anti-seismic designs–will be adopted for the project.
“This is a system immune from all the heartache and exasperation with our existing commuter rail services. This is a railway system that we can be truly proud of,” Dominguez said.
Each train will have eight cars with a capacity of carrying as many as 2,200 passengers and will run at speeds reaching up to 160 kilometers per hour, which will cut travel time between Clark and Calamba from the current five hours by bus to as little as one-and-a-half hours.
“This commuter rail service ought to have been built many years ago. This might have spared our long-suffering commuters all the grief they bear now. But previous governments did not have the fiscal space, did not have the enthusiasm of our international development partners and, most importantly, did not have the unyielding political will that we have in our leader President Duterte today,” Dominguez said.
He said that like the NSCR Railway Project, the Pasig-Marikina River Channel Improvement Project, should have been completed long ago, given that the feasibility studies for it were done way back in 1998. Had this project been completed long ago, Metro Manila “might have been spared the horrific toll inflicted by typhoon Ondoy” in 2009, he added.
The fourth phase of this flood control project involves the implementation of channel improvement works along the stretch of the Upper Marikina River—from the Manggahan Floodway to the Marikina Bridge—and the construction of the Marikina Control Gate Structure plus two floodgates in Cainta and Taytay, Rizal utilizing Japan’s disaster prevention technology.
Targeted for completion by 2027, the project is part of the comprehensive flood control infrastructure under “Build, Build, Build.” The completion of the previous phases will reduce flood inundation in Metro Manila by about 75 percent, helping save lives and property in the process.
JICA’s loan for this flood control project also carries the same concessional lending terms given for the NSCR Railway project.