Third loan deal for Metro Manila subway eyed for signing in March

The Philippine government is set to finalize the third tranche of loan financing for the country's first underground railway system with its Japanese counterpart next month.

In a statement on Tuesday, the Department of Transportation (DOTr) said Transportation Secretary Jaime Bautista is discussing with the National Economic and Development Authority (NEDA) and Department of Finance the review of draft documents pertaining to the loan deal provided by the Japan International Cooperation Agency (JICA) and the Government of Japan.

The DOTr said the Philippines and Japan are expected to finalize the third tranche loan agreement worth ¥150 billion for the project in March this year.

The Philippine government and JICA have so far signed two tranches of loan agreements—the first tranche amounting to ¥104.53 billion, or P47.58 billion, was signed in March 2018, while the second tranche, amounting to ¥253.31 billion, or P112.87 billion, was inked in February 2022.

"It is DOF that is negotiating with JICA," said Bautista.

"With the support of JICA, we are implementing this project on time for completion in 2029," said the Transportation chief.

For his part, Finance Secretary Ralph Recto said that the “Department of Finance is fully committed to securing the funding for this project.”

“We aim to finalize the loan agreement for the third tranche of financing by March 2024," said Recto.

The entire Metro Manila Subway project currently has an estimated total cost of P488.5 billion, of which P370.7 billion will be financed through an official development assistance (ODA) loan from JICA, while P117.7 billion will be covered by the Philippine government.

So far, the DOTr has awarded four contract packages for the project.

These are the CP 101, covering four stations—East Valenzuela, Quirino Highway, Tandang Sora, and North Avenue—and the depot and the Philippine Railway Institute Building, bagged by a joint venture led by EEI Corp.; the CP 102, comprising the stations in Quezon Avenue and East Avenue, bagged by D.M. Consunji Inc.; the CP 103, bagged by Sumitomo Mitsui Construction Co. Ltd., which involves the stations from Anonas to Camp Aguinaldo; and Megawide Construction Corp. was awarded the CP 104, which covers the Ortigas to Shaw Boulevard segment. 

The project involves the construction of a depot and a 33-kilometer railway line consisting of 17 stations that will connect Valenzuela City to Pasay City with a spur line to Ninoy Aquino International Airport (NAIA) Terminal 3.

Once operational, the subway is seen to reduce travel time from Valenzuela to NAIA from one hour and 30 minutes to just 35 minutes, servicing 519,000 passengers daily. —VAL, GMA Integrated News