On behalf of the Philippine Government, Finance Secretary Benjamin E. Diokno signed the Metro Rail Transit (MRT) Line 3 Rehabilitation Project (II) loan agreement with Japan International Cooperation Agency (JICA), represented by Chief Representative in the Philippines Sakamoto Takema, on May 26, 2023 at the Department of Finance (DOF) office in Manila.
The rehabilitation project was originally approved by the National Economic and Development Authority (NEDA) Board on August 22, 2018 with the aim of improving the safety and service of the MRT 3.
The MRT 3 is a 16.9km mass rail transit system with thirteen (13) stations along EDSA Corridor from North Avenue in Quezon City to Taft Avenue in Pasay City.
The rehabilitation includes provisions for capacity including rolling stock, rail tracks, signaling system, power supply system, overhead catenary system (OCS), communications system, and depot and station equipment.
The JPY17.4 billion (around US$130 million) supplemental loan for the MRT 3 was approved by the NEDA Board on February 2, 2023 to finance the increase in the total project cost amounting to PHP29.6 billion, following the additional scope of work submitted by the Department of Transportation (DOTr).
These include: 1) Integration and capacity expansion; 2) complete rehabilitation; 3) operation and maintenance (O&M) concession dovetailing with the expiry of the Build-Lease-Transfer (BLT) agreement in 2025; and 4) addition and extension of maintenance works to account for the six-month period of community quarantine due to the COVID-19 pandemic.
The loan is concessional as 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 in forty (40) years, inclusive of a 10-year grace period.
Japan is the Philippines’ top official development assistance (ODA) partner as of March 2023, with total ODA commitments at around US$10.4 billion, including loans and grants.
Following the signing of the loan agreement, Japan’s total loan net commitment now amounts to around US$10.3 billion, with a total ODA commitment of US$10.5 billion.
Two (2) loans amounting to JPY377 billion (US$2.8 billion) were already signed with JICA within the first quarter of 2023. Among these projects are the North-South Commuter Railway (NSCR) Project (Phase I) (II) and the NSCR Extension Project (II).
DOTr Undersecretary Reinier Paul Yebra and Assistant Secretary Jorjette B. Aquino, along with Embassy of Japan to the Philippines Chargé d’Affaires ad interim Matsuda Kenichi and Economic Minister Nihei Daisuke, witnessed the ceremonial signing of the loan agreement.
