THE Department of Finance (DOF) and the Japan International Cooperation Agency (Jica) signed on Thursday a ¥38.1-billion loan accord for the rehabilitation of the country’s Metro Rail Transit (MRT) 3 Rehabilitation Project.
Finance Secretary Carlos G. Dominguez III, on behalf of the Philippines, and Jica Senior Vice President Yasushi Tanaka, on behalf of Japan, signed the accord for the project, which aims to improve the safety, reliability and level of service of the 16.9-kilometer light rail system with 13 stations spanning across Edsa.
The board of the National Economic and Development Authority chaired by President Duterte gave the go-ahead for the project on August 22, which was then followed 77 days later by this afternoon’s signing of the loan agreement.
“This is by far the fastest loan processing we have completed. I would like to assure our harried commuters that we will rebuild and reinvent this vital rail service as quickly as possible,” Dominguez said.
The finance chief pointed out that the MRT 3 will not only be rehabilitated, but its operations will also be expanded and modernized with the help of the official development assistance (ODA) loan from Japan.
In his statement, Tanaka said the implementation of the project “is good news for the Filipino commuters, so they will have improved access to safe and reliable transportation while also meeting the Philippine government’s priorities to reduce traffic congestion in Metro Manila, attract investments and improve the quality of life of the people.”
Earlier, Foreign Affairs Secretary Teodoro L. Locsin Jr. and Japan Ambassador to the Philippines Koji Haneda had signed the Exchange of Notes on the Japanese loan for the MRT 3 rehabilitation project.
The MRT 3 rehabilitation project will cost a total of P21.96 billion, or approximately $413 million, of which ¥38.1-billion, or about P18.76 billion will be funded by an ODA loan from Jica. The remaining amount of P3.19 billion or about $62 million, will be funded locally.
The loan bears an interest rate of 0.10 percent per annum for nonconsulting services and 0.01 percent per annum for consulting services, with a maturity period of 40 years inclusive of a 12-year grace period.
“This is by every measure a very soft loan that will enable us to address a very pressing problem,” he added.
The rehabilitation will include the replacement of all worn-out tracks, upgrading of the train’s obsolete signaling system and general overhaul of the 72 light rail vehicles that are already 15 years old, with the view to expand the MRT’s current degraded capacity and modernization of all its subsystems.
The Department of Transportation (DOTr), implementing agency, expects the number of operating train sets for MRT 3 to increase from 15 to 20 at peak hours, with intervals of train arrivals reduced by half: from seven minutes to only three-and-a-half minutes. The MRT 3 is also expected to increase its train speed from 30 kilometers per hour to 60 kph.
According to the DOTr, it tapped the services anew of Sumitomo-Mitsubishi Heavy Industries (MHI), the original maintenance provider of MRT 3.
Sumitomo started on October 15 even before the loan agreement was signed to help accelerate the process of rehabilitating the rail system.
From servicing 500,000 passengers per day in 2012, the MRT 3 could only accommodate 388,000 passengers in 2017 owing to the deteriorating condition of the system, plagued by train stoppages, system failures, engine breakdowns and faulty
air-conditioning units.
MRT 3 stations are on North Avenue, Quezon Avenue, Kamuning, Cubao and Santolan-Annapolis, all in Quezon City; Ortigas Avenue in Pasig City; Shaw boulevard and Boni Avenue in Mandaluyong City; Guadalupe, Sen. Gil Puyat Avenue (Buendia), Ayala Avenue and Magallanes Avenue in Makati City; and Taft Avenue in Pasay City.
Transportation Undersecretary Timothy R. Batan said the rehabilitation will take at least 26 months, with the project having a contract period of 43 months.
“The first 26 months is for the rehabilitation of the entire system. The balance is going to be used for the completion of the general overhaul of all the 72 trains. So we need that additional time because, as we’ve explained before, we are going to keep operating while the rehabilitation is ongoing,” Batan said.