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Friday, March 16, 2018
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Metro Manila Subway: PH, Japan sign loan deal
The Philippines and Japan signed on Friday the first tranche of a 104.5 billion yen (P51.3 billion) loan for Metro Manila's first subway, one of the centerpieces of President Rodrigo Duterte's infrastructure overhaul, according to a government statement.
The subway will begin partial operations by 2020, said Finance Secretary Carlos Dominguez, who signed the loan along with Japan International Cooperation Agency chief representative Yoshio Wada.
Dominguez called the subway the "biggest single project" under the P8 trillion program dubbed "Dutertenomics."
Once completed, the subway will have 14 stations and will run from Mindanao Avenue in Quezon City up to the Ninoy Aquino International Airport.
"The timely completion of the subway project will crown the aggressive infrastructure program the administration of President Duterte has initiated," Dominguez said.
"It will likewise crown the achievement of the economic diplomacy the Duterte administration has undertaken," he said.
Japan has increased engagements with the Philippines since the time of Duterte's predecessor, Benigno "Noynoy" Aquino, as Tokyo and Manila faced separate maritime disputes with Beijing.
In a rare diplomatic gesture, Japanese Prime Minister Shinzo Abe visited Duterte at his home in Davao City last year.
The subway will begin partial operations by 2020, said Finance Secretary Carlos Dominguez, who signed the loan along with Japan International Cooperation Agency chief representative Yoshio Wada.
Dominguez called the subway the "biggest single project" under the P8 trillion program dubbed "Dutertenomics."
Once completed, the subway will have 14 stations and will run from Mindanao Avenue in Quezon City up to the Ninoy Aquino International Airport.
"The timely completion of the subway project will crown the aggressive infrastructure program the administration of President Duterte has initiated," Dominguez said.
"It will likewise crown the achievement of the economic diplomacy the Duterte administration has undertaken," he said.
Japan has increased engagements with the Philippines since the time of Duterte's predecessor, Benigno "Noynoy" Aquino, as Tokyo and Manila faced separate maritime disputes with Beijing.
In a rare diplomatic gesture, Japanese Prime Minister Shinzo Abe visited Duterte at his home in Davao City last year.
PHL, JICA sign ¥104.53-B loan deal for Metro Manila subway
The Philippine government and the Japan International Cooperation Agency (JICA) signed on Friday the first tranche of a financing agreement for the first phase of the Metro Manila Subway project.
The first tranche of the loan deal amounts to ¥104.530 billion or around P51 billion.
It carries an interest rate of 0.10 percent per annum for non-consulting services and 0.01 percent per annum for consulting services to be repaid within 40 years including a 12-year grace period.
The agreement was signed by top officials of the Philippine government and JICA in Manila.
Signing for the Philippines were Finance Secretary Carlos Dominguez III, Budget Secretary Benjamin Diokno, and Transportation Undersecretary for Railways Timothy Batan.
The Japanese government was represented by incoming JICA Chief Representative Yoshio Wada, outgoing JICA Chief Representative Susumo Ito, and Japan Embassy representative Noboru Kageyama.
“This project, which is the Phase I of the Metro Manila Subway Project, is so far the biggest single project under the Build, Build, Build program of President Duterte,” Dominguez said in his remarks during the signing ceremony.
“For the first phase, we calculate a total project cost of P356.96 billion or $7.05 billion. This phase, covering the Central Zone, involves the construction of about 30 kilometers of underground railway with 14 stations with the possible extension of one to two more stations being planned by DOTr, from Mindanao Avenue to the Ninoy Aquino International Airport (NAIA),” Dominguez said.
The project includes a depot in Valenzuela City, electro-mechanical systems and rolling stock, and the establishment of a Philippine Railway Institute (PRI).
“The Institute will provide training as well as do research and development on regulation, train operations and maintenance. This will build a corps of expert train personnel to manage not only the subway system but all the commuter rail lines of the country,” Dominguez noted.
First subway rail system
“It is about time that our commuter lines be run by real experts,” he said.
The detailed engineering design for the subway, which is being funded under a JICA grant, is now ongoing.
“The design includes flood management features and applies the best seismic technology there is. We will acquire tunnel boring equipment to hasten the construction period. The Philippine government commits to working on this project 25/8 to get it done at the soonest possible time,” the Finance chief said.
The Philippines’ first subway rail system stretches 30 kilometers. It has 14 stations, from Mindanao Ave. in Quezon City to the Ninoy Aquino International Airport in Parañaque City, with a provision for a 5-km extension and two additional stations to connect with the Light Rail Transit Line 1.
The subway train is expected to reduce commuting time from Quezon City to the airport to under 40 minutes. The actual construction works is scheduled before the year ends.
Partial operations of the first three stations is expected in 2022, with the whole system to be fully operational by 2025.
“We are targeting May 2022 to begin operation of the first three of the subway stations—Mindanao Avenue-Quirino Highway, Tandang Sora, and North Avenue. The entire Central Zone will be operational by 2025, including the commercial space for the subway stations that will help defray the cost of operating this facility,” Dominguez said.
An estimated 370,000 commuters are expected to benefit each day during the first year of operations of the subway project.
“Previously thought by many to be impossible, today’s milestone in realizing the Philippines’ first subway project is a testament to the adage that bold problems require bold solutions, and that bold solutions require bold and visionary leaders to deliver,” Batan said.
Dominguez noted that in line with the “fast and sure” approach, the Philippine government processed the loan approvals for the project in six months.
“The timely completion of the subway project will crown the aggressive infrastructure program the administration of President Duterte has initiated. It will likewise crown the achievement of the economic diplomacy the Duterte administration has undertaken,” Dominguez said. —VDS, GMA News
The first tranche of the loan deal amounts to ¥104.530 billion or around P51 billion.
It carries an interest rate of 0.10 percent per annum for non-consulting services and 0.01 percent per annum for consulting services to be repaid within 40 years including a 12-year grace period.
The agreement was signed by top officials of the Philippine government and JICA in Manila.
Signing for the Philippines were Finance Secretary Carlos Dominguez III, Budget Secretary Benjamin Diokno, and Transportation Undersecretary for Railways Timothy Batan.
The Japanese government was represented by incoming JICA Chief Representative Yoshio Wada, outgoing JICA Chief Representative Susumo Ito, and Japan Embassy representative Noboru Kageyama.
“This project, which is the Phase I of the Metro Manila Subway Project, is so far the biggest single project under the Build, Build, Build program of President Duterte,” Dominguez said in his remarks during the signing ceremony.
“For the first phase, we calculate a total project cost of P356.96 billion or $7.05 billion. This phase, covering the Central Zone, involves the construction of about 30 kilometers of underground railway with 14 stations with the possible extension of one to two more stations being planned by DOTr, from Mindanao Avenue to the Ninoy Aquino International Airport (NAIA),” Dominguez said.
The project includes a depot in Valenzuela City, electro-mechanical systems and rolling stock, and the establishment of a Philippine Railway Institute (PRI).
“The Institute will provide training as well as do research and development on regulation, train operations and maintenance. This will build a corps of expert train personnel to manage not only the subway system but all the commuter rail lines of the country,” Dominguez noted.
First subway rail system
“It is about time that our commuter lines be run by real experts,” he said.
The detailed engineering design for the subway, which is being funded under a JICA grant, is now ongoing.
“The design includes flood management features and applies the best seismic technology there is. We will acquire tunnel boring equipment to hasten the construction period. The Philippine government commits to working on this project 25/8 to get it done at the soonest possible time,” the Finance chief said.
The Philippines’ first subway rail system stretches 30 kilometers. It has 14 stations, from Mindanao Ave. in Quezon City to the Ninoy Aquino International Airport in Parañaque City, with a provision for a 5-km extension and two additional stations to connect with the Light Rail Transit Line 1.
The subway train is expected to reduce commuting time from Quezon City to the airport to under 40 minutes. The actual construction works is scheduled before the year ends.
Partial operations of the first three stations is expected in 2022, with the whole system to be fully operational by 2025.
“We are targeting May 2022 to begin operation of the first three of the subway stations—Mindanao Avenue-Quirino Highway, Tandang Sora, and North Avenue. The entire Central Zone will be operational by 2025, including the commercial space for the subway stations that will help defray the cost of operating this facility,” Dominguez said.
An estimated 370,000 commuters are expected to benefit each day during the first year of operations of the subway project.
“Previously thought by many to be impossible, today’s milestone in realizing the Philippines’ first subway project is a testament to the adage that bold problems require bold solutions, and that bold solutions require bold and visionary leaders to deliver,” Batan said.
Dominguez noted that in line with the “fast and sure” approach, the Philippine government processed the loan approvals for the project in six months.
“The timely completion of the subway project will crown the aggressive infrastructure program the administration of President Duterte has initiated. It will likewise crown the achievement of the economic diplomacy the Duterte administration has undertaken,” Dominguez said. —VDS, GMA News
Fare hike likely to have pushed Metro ridership to 4-year low, shows data
Last October’s tariff hike appears to have dragged Delhi Metro’s daily average ridership to pre-2015 levels, when trains ran on fewer corridors, spanning around 190 km in length, The Indian Express has learnt. Currently, Delhi Metro’s total network length has crossed the 250-km mark, but the fare hike seems to have forced lakhs of commuters to stop using the signature public transport of one of the world’s most polluted cities.
According to records with the Delhi government, the average daily ridership in the months following the fare hike has dropped by up to 15 per cent as opposed to the previous months.
In the months of October 2017, November 2017, December 2017 and January 2018, an average of 24.2, 24.5 lakh, 22.97 lakh and 23.23 lakh people commuted daily on Yellow Line, Blue Line, Red Line, Green Line and Violet Line collectively. In February, the figure improved marginally to 24.06 lakh. During the first two weeks of March, the average daily ridership has been 20.11 lakh.
The rapid mass transit lost over 2.6 lakh commuters per day last November, 4.23 lakh daily last December, 3.9 lakh commuters daily in January and 3.14 lakh commuters per day in February. The last time the Metro recorded a ridership of 30 lakh was in October 10, 2017, the day Metro’s second phase of fare hike kicked in. The first phase of the hike came into effect in May.
The last time the Metro ridership was this low was in 2013-14 and 2014-15 when the average daily ridership were around 22 lakh and 24 lakh respectively. In 2015-16, it rose to 25.9 lakh, and in 2016-17, it increased further to 27.6 lakh. Till May 2017, Metro transported around 28 lakh passengers daily. Since then, it has largely been a downhill ride. October’s hike bled Metro even further in terms of commuters.
On Wednesday, during the launch of the Pink Line, Chief Minister Arvind Kejriwal had appealed to the Centre to reduce the commuting fares. However, Union Minister Hardeep Puri made it clear that no such rollback was possible.
In a statement, DMRC said that ridership has been going up again since January. “About 24,000 more commuters travelled by the Metro every day in January in comparison to December, 2017. In February, 2018, there was an increase of over 30,000 riders every day. Therefore, the trends for the last two months indicate that ridership is on a upward trend,” the statement said. “The highest ridership achieved in December, 2017, was 25.64 lakhs while in January, 2018, the same figure stood at 26.85 lakhs. The highest ridership in February has been even higher at 26.98 lakhs. Metro’s ridership is generally low in the months of December and January every year because of the holiday season. The same trend could be observed this year also. However, despite the holiday season, January registered a better ridership than the preceding month,” the statement added.
However, if one goes by the ridership trends, such monthly variations are usual and DMRC has a lot of ground to cover if it is to attain ridership levels (discounting the commutership on the corridors such as Magenta Line and Pink Line which were launched after the fare hike) recorded just before the tariff hike.
Last year, in July, August and September, the Metro’s daily average ridership figures were 26.9 lakh, 28.5 lakh and 28.4 lakh, respectively, reflecting a trajectory of sustained growth
Last year, the DMRC had increased its fares twice — in May and October. The current fare structure is: up to 2 km — Rs 10, 2 to 5 km — Rs 20, 5 to 12 km —Rs 30, 12 to 21 km — Rs 40, 21 to 32 km — Rs 50, and for journeys beyond 32 km — Rs 60 .
According to records with the Delhi government, the average daily ridership in the months following the fare hike has dropped by up to 15 per cent as opposed to the previous months.
In the months of October 2017, November 2017, December 2017 and January 2018, an average of 24.2, 24.5 lakh, 22.97 lakh and 23.23 lakh people commuted daily on Yellow Line, Blue Line, Red Line, Green Line and Violet Line collectively. In February, the figure improved marginally to 24.06 lakh. During the first two weeks of March, the average daily ridership has been 20.11 lakh.
The rapid mass transit lost over 2.6 lakh commuters per day last November, 4.23 lakh daily last December, 3.9 lakh commuters daily in January and 3.14 lakh commuters per day in February. The last time the Metro recorded a ridership of 30 lakh was in October 10, 2017, the day Metro’s second phase of fare hike kicked in. The first phase of the hike came into effect in May.
The last time the Metro ridership was this low was in 2013-14 and 2014-15 when the average daily ridership were around 22 lakh and 24 lakh respectively. In 2015-16, it rose to 25.9 lakh, and in 2016-17, it increased further to 27.6 lakh. Till May 2017, Metro transported around 28 lakh passengers daily. Since then, it has largely been a downhill ride. October’s hike bled Metro even further in terms of commuters.
On Wednesday, during the launch of the Pink Line, Chief Minister Arvind Kejriwal had appealed to the Centre to reduce the commuting fares. However, Union Minister Hardeep Puri made it clear that no such rollback was possible.
In a statement, DMRC said that ridership has been going up again since January. “About 24,000 more commuters travelled by the Metro every day in January in comparison to December, 2017. In February, 2018, there was an increase of over 30,000 riders every day. Therefore, the trends for the last two months indicate that ridership is on a upward trend,” the statement said. “The highest ridership achieved in December, 2017, was 25.64 lakhs while in January, 2018, the same figure stood at 26.85 lakhs. The highest ridership in February has been even higher at 26.98 lakhs. Metro’s ridership is generally low in the months of December and January every year because of the holiday season. The same trend could be observed this year also. However, despite the holiday season, January registered a better ridership than the preceding month,” the statement added.
However, if one goes by the ridership trends, such monthly variations are usual and DMRC has a lot of ground to cover if it is to attain ridership levels (discounting the commutership on the corridors such as Magenta Line and Pink Line which were launched after the fare hike) recorded just before the tariff hike.
Last year, in July, August and September, the Metro’s daily average ridership figures were 26.9 lakh, 28.5 lakh and 28.4 lakh, respectively, reflecting a trajectory of sustained growth
Last year, the DMRC had increased its fares twice — in May and October. The current fare structure is: up to 2 km — Rs 10, 2 to 5 km — Rs 20, 5 to 12 km —Rs 30, 12 to 21 km — Rs 40, 21 to 32 km — Rs 50, and for journeys beyond 32 km — Rs 60 .
Japan OKs P51-B loan for PH subway
The rollout of the country’s first subway system moved a step closer as the Japanese government extended a 104.5-billion yen or P51.3-billion loan to finance the initial phase of the flagship infrastructure project.
Japan International Cooperation Agency senior representative Tetsuya Yamada told the Inquirer on Thursday that the first tranche of the loan agreement for the underground railroad to be signed today would be slapped an interest rate of 0.1 percent a year and a repayment period of 40 years, including a 12-year grace period.
While the Metro Manila Subway Project Phase 1 is projected to cost P356.9 billion, Japan Prime Minister Shinzo Abe earlier expressed their intention to possibly lend a total of up to 600 billion yen or about P294.8 billion, Yamada said, citing the Japan-Philippines Joint Statement on Bilateral Cooperation for the Next Five Years issued in October.
The subway will be the biggest Philippine infrastructure project to be funded by Japanese official development assistance.
It will connect Mindanao Avenue in Quezon City and Food Terminal Inc. in Taguig City, with a spur line to the Ninoy Aquino International Airport.
The construction of the 36-kilometer subway, whose implementation was green-lighted by the National Economic and Development Authority Board chaired by President Duterte in September, will begin next year.
The subway will be completed by 2025, although three of the 14 stations were targeted to be in operation as early as 2022.
Transportation Secretary Arthur Tugade said last month that they planned to fast-track the partial opening of the subway system to the fourth quarter of 2021.
In a statement posted on its website, Japan’s Ministry of Foreign Affairs (Mofa) said that the subway “will contribute to relieving serious traffic congestion in Metro Manila by meeting growing transportation demand, as well as easing atmospheric pollution and climate change.”
“The new subway is estimated to transport approximately 500,000 passengers per day in 2027 (two years after the completion of the project), and to reduce the time required for moving from Mindanao Avenue station to FTI station to 30 minutes by express train, where it currently takes approximately two hours by car,” Mofa said.
The project is thus expected to contribute to sustainable economic growth through the promotion of investment in the Philippines, Mofa added.
Documents last month showed that Japan would finance 19 infrastructure projects worth at least P753 billion in support of the Duterte administration’s ambitious “Build, Build, Build” program.
Read more: http://business.inquirer.net/247738/japan-oks-p51-b-loan-ph-subway#ixzz59ypfhaZ2
Follow us: @inquirerdotnet on Twitter | inquirerdotnet on Facebook
Japan International Cooperation Agency senior representative Tetsuya Yamada told the Inquirer on Thursday that the first tranche of the loan agreement for the underground railroad to be signed today would be slapped an interest rate of 0.1 percent a year and a repayment period of 40 years, including a 12-year grace period.
While the Metro Manila Subway Project Phase 1 is projected to cost P356.9 billion, Japan Prime Minister Shinzo Abe earlier expressed their intention to possibly lend a total of up to 600 billion yen or about P294.8 billion, Yamada said, citing the Japan-Philippines Joint Statement on Bilateral Cooperation for the Next Five Years issued in October.
The subway will be the biggest Philippine infrastructure project to be funded by Japanese official development assistance.
It will connect Mindanao Avenue in Quezon City and Food Terminal Inc. in Taguig City, with a spur line to the Ninoy Aquino International Airport.
The construction of the 36-kilometer subway, whose implementation was green-lighted by the National Economic and Development Authority Board chaired by President Duterte in September, will begin next year.
The subway will be completed by 2025, although three of the 14 stations were targeted to be in operation as early as 2022.
Transportation Secretary Arthur Tugade said last month that they planned to fast-track the partial opening of the subway system to the fourth quarter of 2021.
In a statement posted on its website, Japan’s Ministry of Foreign Affairs (Mofa) said that the subway “will contribute to relieving serious traffic congestion in Metro Manila by meeting growing transportation demand, as well as easing atmospheric pollution and climate change.”
“The new subway is estimated to transport approximately 500,000 passengers per day in 2027 (two years after the completion of the project), and to reduce the time required for moving from Mindanao Avenue station to FTI station to 30 minutes by express train, where it currently takes approximately two hours by car,” Mofa said.
The project is thus expected to contribute to sustainable economic growth through the promotion of investment in the Philippines, Mofa added.
Documents last month showed that Japan would finance 19 infrastructure projects worth at least P753 billion in support of the Duterte administration’s ambitious “Build, Build, Build” program.
Read more: http://business.inquirer.net/247738/japan-oks-p51-b-loan-ph-subway#ixzz59ypfhaZ2
Follow us: @inquirerdotnet on Twitter | inquirerdotnet on Facebook
Still a big problem
Budget Secretary Ben Diokno was wrong to tell me they have solved the right of way problems of the San Miguel-led NLEX-SLEX connector road. Ben said DPWH Sec Mark Villar used the savvy of his family property companies to fix the problem.
It looks like Ben will need more than the Orwellian tech surveillance methods he plans to use to monitor the progress of projects under Build Build Build. Ben will need informers working within DPWH to help him find out if Secretary Villar is telling him what is really going on.
On the connector road project of San Miguel, sources revealed to me that their ROW problems are far from resolved. Indeed, the announced opening of the segment up to the Paco station by yearend may not happen, if the ROW problems are not resolved fast.
Sources gave me some details about the ROW status for that segment up to Paco station: 1) Seven NGCP high voltage poles along Quirino avenue from the corner of Pedro Gil to small bridge (after Philippine Columbian) need to be relocated. 2) Awaiting DPWH/ NGCP negotiation for work to commence; 3) We got information NGCP has not bought new poles /accessories. 4) Completion of viaduct along Osmeña highway (from Buendia to corner Osmeña/Quirino) is possible by end 2018, but no ramp, so will remain useless.
Ben gave me the impression that his office would effectively be the “bastonero” of all Build Build Build projects. But without good information, Ben will be clueless. His colleagues in the Cabinet can make false claims of progress.
Why is the completion of the connector road project important? Simple… because it is claimed that it can take as much as 50 percent of vehicles in EDSA during rush hours. San Miguel also plans to put up a BRT on top of that connector road to go all the way to Susana Heights which will help commuters now suffering that horrible MRT 3 service.
This project previously encountered ROW problems when motels in Sta Mesa refused to give way. This forced San Miguel to divert the route to run over the San Juan River, but the permit to do so slept at the Pasig River Rehabilitation Commission and DPWH for a year.
Here is something I found out some weeks ago about another priority project mismanaged by the Abaya-era DOTC and is suffering the same sad fate again under Secretary Tugade.
The secret status of the LRT 2 extension to Masinag is as follows: 1) Stations should be done by year end. 2) The rails/electro mechanicals had 2 failed bids. 3) DOTr budget is half of bids received. 4) Bidders had a meeting with DOTr after the first failed bid to adjust budget but no action. It is still same old budget except increase in construction time from 16 to 20 months. 5) DOTr is negotiating with Marubeni to reduce scope to meet present budget, but raises the question of how they will make the trains run.
That means the project will be delayed indefinitely without a bigger budget or a hefty discount from Marubeni. That means the traffic on Marcos Highway will be screwed up for a longer time than previously announced.
That’s the problem with GAA-funded projects. If this was PPP, no such funding problems and the trains would have been running months ago.
Incidentally, I also got a reaction to my column on Ben Diokno from an academic who knows the workings of government.
“There is no doubt Ben Diokno is one of the most competent and hard-working members of the Duterte government. But the lack of efficiency in infrastructure investment is beyond Ben’s sincerity (and Big Brother monitoring won’t help).
“There are limitations in the institutions of a developing country that wants to ramp up infrastructure spending over a short time period. Both Indonesia and the Philippines are now in the same boat.
“Last week, President Widodo temporarily halted all transportation projects, after a dozen major accidents that killed five and injured dozens. Indonesia is rushing the completion of the infrastructure projects in time for the Asian Games in 2018 and the presidential elections in 2019.
“But the empirical evidence shows that infrastructure projects are less likely to be successful when they are undertaken during periods of higher than average public investments (e.g. from 1.7 percent of GDP to 5.6 percent of GDP).
“This is because of present supply bottlenecks, technical manpower bottlenecks, poor project evaluation and selection procedures, and lack of sound policies and institutions for the selection and management of infrastructure projects (e.g. you have ceremonial groundbreaking ceremonies, but no actual construction).
“In fact LRT1 has not started construction more than three years after the concession contract was implemented. It is also mind boggling for DOTr to announce to partly inaugurate the Metro Manila Subway in 2023, when in fact there is no firm financial closure vis-à-vis Japanese ODA and there is no definite starting date for construction.
“There is also uncertainty MPIC will finish their connector road from NLEX Segment 10 to SLEX in the first quarter of 2021 as announced. The start of construction is still tentatively set for the third quarter of 2018.
“The bureaucracy’s lack of technical capacity to assess the design of infrastructure projects (e.g. how local resources cope with front-loading of spending) is a problem. Scaling-up investments too much and too fast can only reduce the success rate of individual projects in the Build Build Build program, and limiting its impact on the economy. Since infrastructure build up takes time, the BBB Program should shift to a gradual scaling-up approach.”
Finally, in a comment on my post on Facebook, Arnel Paciano Casanova who formerly headed BCDA, had this revealing observation: “Having implemented both ODA and PPP projects, I prefer the PPP. Moral hazard, risk allocation and delivery are three important factors to consider.”
Boo Chanco’s e-mail address is bchanco@gmail.com. Follow him on Twitter @boochanco
It looks like Ben will need more than the Orwellian tech surveillance methods he plans to use to monitor the progress of projects under Build Build Build. Ben will need informers working within DPWH to help him find out if Secretary Villar is telling him what is really going on.
On the connector road project of San Miguel, sources revealed to me that their ROW problems are far from resolved. Indeed, the announced opening of the segment up to the Paco station by yearend may not happen, if the ROW problems are not resolved fast.
Sources gave me some details about the ROW status for that segment up to Paco station: 1) Seven NGCP high voltage poles along Quirino avenue from the corner of Pedro Gil to small bridge (after Philippine Columbian) need to be relocated. 2) Awaiting DPWH/ NGCP negotiation for work to commence; 3) We got information NGCP has not bought new poles /accessories. 4) Completion of viaduct along Osmeña highway (from Buendia to corner Osmeña/Quirino) is possible by end 2018, but no ramp, so will remain useless.
Ben gave me the impression that his office would effectively be the “bastonero” of all Build Build Build projects. But without good information, Ben will be clueless. His colleagues in the Cabinet can make false claims of progress.
Why is the completion of the connector road project important? Simple… because it is claimed that it can take as much as 50 percent of vehicles in EDSA during rush hours. San Miguel also plans to put up a BRT on top of that connector road to go all the way to Susana Heights which will help commuters now suffering that horrible MRT 3 service.
This project previously encountered ROW problems when motels in Sta Mesa refused to give way. This forced San Miguel to divert the route to run over the San Juan River, but the permit to do so slept at the Pasig River Rehabilitation Commission and DPWH for a year.
Here is something I found out some weeks ago about another priority project mismanaged by the Abaya-era DOTC and is suffering the same sad fate again under Secretary Tugade.
The secret status of the LRT 2 extension to Masinag is as follows: 1) Stations should be done by year end. 2) The rails/electro mechanicals had 2 failed bids. 3) DOTr budget is half of bids received. 4) Bidders had a meeting with DOTr after the first failed bid to adjust budget but no action. It is still same old budget except increase in construction time from 16 to 20 months. 5) DOTr is negotiating with Marubeni to reduce scope to meet present budget, but raises the question of how they will make the trains run.
That means the project will be delayed indefinitely without a bigger budget or a hefty discount from Marubeni. That means the traffic on Marcos Highway will be screwed up for a longer time than previously announced.
That’s the problem with GAA-funded projects. If this was PPP, no such funding problems and the trains would have been running months ago.
Incidentally, I also got a reaction to my column on Ben Diokno from an academic who knows the workings of government.
“There is no doubt Ben Diokno is one of the most competent and hard-working members of the Duterte government. But the lack of efficiency in infrastructure investment is beyond Ben’s sincerity (and Big Brother monitoring won’t help).
“There are limitations in the institutions of a developing country that wants to ramp up infrastructure spending over a short time period. Both Indonesia and the Philippines are now in the same boat.
“Last week, President Widodo temporarily halted all transportation projects, after a dozen major accidents that killed five and injured dozens. Indonesia is rushing the completion of the infrastructure projects in time for the Asian Games in 2018 and the presidential elections in 2019.
“But the empirical evidence shows that infrastructure projects are less likely to be successful when they are undertaken during periods of higher than average public investments (e.g. from 1.7 percent of GDP to 5.6 percent of GDP).
“This is because of present supply bottlenecks, technical manpower bottlenecks, poor project evaluation and selection procedures, and lack of sound policies and institutions for the selection and management of infrastructure projects (e.g. you have ceremonial groundbreaking ceremonies, but no actual construction).
“In fact LRT1 has not started construction more than three years after the concession contract was implemented. It is also mind boggling for DOTr to announce to partly inaugurate the Metro Manila Subway in 2023, when in fact there is no firm financial closure vis-à-vis Japanese ODA and there is no definite starting date for construction.
“There is also uncertainty MPIC will finish their connector road from NLEX Segment 10 to SLEX in the first quarter of 2021 as announced. The start of construction is still tentatively set for the third quarter of 2018.
“The bureaucracy’s lack of technical capacity to assess the design of infrastructure projects (e.g. how local resources cope with front-loading of spending) is a problem. Scaling-up investments too much and too fast can only reduce the success rate of individual projects in the Build Build Build program, and limiting its impact on the economy. Since infrastructure build up takes time, the BBB Program should shift to a gradual scaling-up approach.”
Finally, in a comment on my post on Facebook, Arnel Paciano Casanova who formerly headed BCDA, had this revealing observation: “Having implemented both ODA and PPP projects, I prefer the PPP. Moral hazard, risk allocation and delivery are three important factors to consider.”
Boo Chanco’s e-mail address is bchanco@gmail.com. Follow him on Twitter @boochanco
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