DoTr ordered to renegotiate loan agreements for 3 railway projects

DoTr ordered to renegotiate loan agreements for 3 railway projects

By Tracy Cabrera

File photo of newly appointed transportation undersecretary for railways Cesar Chavez (Photo credits: RMN Networks)

MALACAÑAN PALACE — Apparently determined in establishing an efficient mass transport system in the country, President Ferdinand ‘Bongbong’ Marcos Jr. has directed the Department of Transportation (DoTr) to go back to the negotiating table to secure the loan agreements aimed to fund the implementation of three big-ticket railway projects.

The projects that the chief executive was referring to are the Subic-Clark Railway Project; the Philippine National Railways (PNR) South Long-Haul Project and the Davao-Digos segment of the Mindanao Railway Project (MRP) which were to be funded under China’s official development assistance (ODA) through loan agreements between the governments of the Republic of the Philippines and the People’s Republic of China

In a statement, transportation undersecretary for railways Cesar Chavez disclosed that “there was a policy discussion on three China ODA Rail Projects in the last Cabinet meeting during which the President commented that as a matter of policy, (government) should encourage more investments in rail and . . . focus(ed) more on rail transport.”

The twelve-time presidential appointee since the time of the late president Corazon ‘Cory’ Aquino added that the contract for the PhP142-billion PNR South Long-Haul Project—also called the PNR Bicol Express—was awarded to the joint venture of China Railway Group Ltd., China Railway No. 3 Engineering Group Company Limited and China Railway Engineering Consulting Group Co. Ltd.

On the other hand, the PhP83-billion Tagum-Davao-Digos segment of the MRP failed to proceed after China was unable to submit a shortlist of contractors for its design-build contract. Meanwhile, the contract for the construction of the PhP51-billion Subic-Clark Railway Project was awarded to China Harbour Engineering Co. in December 2020.

Chavez cited that the loan agreements for three railway projects are now considered “withdrawn” after the Chinese government failed to act on the funding requests by the previous administration under erstwhile President Rodrigo Roa Duterte.

As a final word, the transportation chief gave assurances that other funding options are now being considered for the three railway projects such as the possibility of opening it for the private sector since the government thrust is towards public-private-partnerships (PPP).


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