The Department of Transportation secured an additional P112.31 billion (253 billion yen) in loan from the Japan International Cooperation Agency for the country’s first underground railway system.
It will continue the support for the Metro Manila Subway Project, as the first tranche amounting to 105 billion yen (P46 billion), signed in March 2018, is almost fully utilized.
The new loan was signed by DOTR under the leadership of Secretary Arthur Tugade and JICA on Feb. 10.
It brought the total JICA ODA loan to 848 billion yen (P376.6 billion) in support of the country’s railways network, which suffered many decades of underinvestment and delayed project implementation, and which has been aggressively catching up under the Duterte administration’s “Build, Build, Build” program.
These official development assistance loans, which carry highly concessional terms of 0.10-percent interest per annum, 40-year repayment period and grace period of 12 years, were tranched to optimize financing costs.
“Japan’s equally aggressive ramping up of support is testament to its confidence in the DOTR’s strengthened implementing capacity, including its progressive ability to comply with ODA lenders’ strict environmental, social, and governance safeguards,” the agency said.
The proposal for a subway in Metro Manila was first developed in 1973 under the Urban Transport Study in Manila Metropolitan Area. When Tugade took the helm of DOTr in July 2016, the MMSP did not have a completed feasibility study, did not have NEDA board investment approval, did not have any financing and did not have a single awarded contract.
The MMSP was approved by the NEDA board in September 2017, its first tranche loan was signed in March 2018 and its first contract was awarded in November 2018.
Four other contracts were awarded for civil works of the partial operability section, 240 train cars and electromechanical systems. Three additional civil works contracts are scheduled to be awarded within the first half of this year.
Construction of the MMSP’s partial operability section from Valenzuela to North Ave. is now in full swing, and the project’s first two (out of 25) tunnel boring machines arrived in 2021.
The 33-kilometer subway, dubbed as the “project of the century” stretches from Valenzuela in the north to NAIA Terminal Terminal 3 and FTI in the south.
The project is expected to reduce travel time between Quezon City and NAIA from one hour and 30 minutes down to just 35 minutes. It is expected to serve around 370,000 passengers a day in its first year of full operations, with capacity to serve up to 1 million passengers a day in later years.
The MMSP is physically interconnected and interoperable with the North-South Commuter Railway System’s south segment, enabling a passenger to board a subway train, for example, in North Ave. Station of MMSP and get off at the Calamba Station of NSCR.