THE Philippines and Japan signed a ¥9.399-billion (P19.387-million) loan agreement on Wednesday for the construction of the third phase of the Arterial Road Bypass Project designed to ease traffic congestion in Bulacan.
On behalf of the Philippines, Finance Secretary Carlos G. Dominguez III signed the project-loan agreement amounting to approximately $89 million or P4.25 billion. Signing for Japan was Susumu Ito, chief representative of the Japan International Cooperation Agency (Jica), on Wednesday.
The Philippines will provide a counterpart funding of P1 billion or around ¥1.476 billion, equivalent to $15 million, for the project, which has a total cost of ¥10.87 billion equivalent to about P5.26 billion or approximately $104 million.
“[This is], in a word, an economically worthwhile investment. It symbolizes the economic calculation, immediacy of impact and long-term multiplier effects that we wish to see in all the ‘Build Build Build’ projects,” Dominguez said after signing the agreement with Ito at the National Economic and Development Authority (Neda) main office in Ortigas Center, Pasig City.
On behalf of the Philippine government, Dominguez thanked Jica for its continued funding support for the construction of the road bypass, as well as the flagship infrastructure projects of the Duterte administration, and assured it of the “efficiency in the use of the loans and urgency in the implementation of the projects.”
The Arterial Road Bypass, also known as the Plaridel Bypass, is a 24.61-kilometer arterial road that will link the North Luzon Expressway (Nlex) in Balagtas, Bulacan, with the Philippine-Japan Friendship Highway, also called Maharlika Highway, in San Rafael, Bulacan.
The agreement for phase 3 of the project provides for interest-rates of 1.5 percent per annum for non-consulting services and 0.01 percent per annum for consulting services, with a repayment period of 20 years and a 10-year grace period.
Phase 1 of the Arterial Bypass Road Project, costing ¥6.3 billion or $55.6 million, and Phase 2 worth ¥4.591 billion or $40.9 million, were both financed with official development assistance (ODA) loans from Japan signed in 2004 and 2012, respectively.
The project’s first component was completed in November 2012, while Phase 2 is nearing completion and is expected to be inaugurated in May this year. Phase 3 of the project involves upgrading and expanding the existing bypass road from two lanes to a four-lane carriageway national road. “We are grateful for the generosity of the Japanese people through Jica and the Japanese government, as well as the strong support you have extended to us at this key juncture in our own economic emergence,” he added.
The finance chief said the government chose to use ODA for the project, instead of the public-private partnership (PPP) method, since the latter takes a bit of time to complete, around 320 months, among others. “The original PPP project was supposed to be P10 billion, and by doing it ourselves, we will probably be spending P5.2 billion. Apparently, it’s going to work out for us financially,” he said.