P741 billion to be spent for Luzon, Mindanao railway projects from 2021 to 2025 - DOTr

Nika Lazo, ABS-CBN News

Posted at Feb 24 2021 11:00 PM

The Philippine National Railways introduces its new Diesel Hydraulic Locomotive and Passenger Coaches in an inaugural run on January 28, 2021 at the PNR Dela Rosa Station in Makati City. Mark Demayo, ABS-CBN News

MANILA - A total of P741.4 billion in capital expenditures (capex) is being set aside for the development of multiple railway projects in Luzon and Mindanao, according to the Department of Transportation (DOTr) on Wednesday.

Timothy John Batan, the transport undersecretary for railways, said in a virtual presser that the government is allotting the budget for 11 railway projects to decongest Metro Manila and to move the country to progress.

He cited that as of 2017, traffic congestion in Metro Manila has an annual economic cost of nearly P1.3 trillion.

The programmed capital expenditure from 2021 to 2025 of the Department of Transportation (DOTr) for railways. Screen grab from DOTr virtual presser on February 24, 2021

The capex spending program is expected to forward the country's major rail projects, which has a combined project cost of P1.669 trillion, broken down as follows:

  • LRT-1 Cavite Extension - P65 billion
  • LRT-2 East Extension - P9.5 billion
  • LRT-2 West Extension - P10.1 billion
  • MRT-3 Rehabilitation - P30 billion
  • MRT-4 - P49.8 billion
  • MRT-7 - P68.2 billion
  • Metro Manila Subway - P357 billion
  • Common Station - P2.95 billion
  • North-South Commuter Railway - P777.6 billion
  • Subic-Clark Railway - P50 billion
  • PNR Bicol / South Long Haul - P175.3 billion
  • Mindanao Railway - P81.7 billion

Batan said the country's rail network is seen to expand to 1,209 km by 2025 from only 77 kilometers in 2016.

This is comparable to the 170.2 km rail network of Jakarta, Seoul's 490 km, Tokyo's 700 km, and Shanghai's 690 km.

The slide shows the before and after scenario of the country's railway system from 2016 to 2022, in the duration of President Rodrigo Duterte's term. Screen grab from DOTr virtual presser on February 24, 2021

Apart from the country's own budget, Batan said funding sources for the railway projects include official development assistance (ODA) loans from Japan International Cooperation Agency, Asian Development Bank, the Chinese government, and from the public-private partnership (PPP) scheme.

"We really need mass public transport. And trains or railways are the most efficient form of mass public transport with the highest capacity. That is why we are pushing for the funding of these projects even through loans," Batan said.

He noted that the Philippines is a "lower middle income country" that can afford to avail of ODA loans with friendly rates.

ODA loans, he said, are offered to the Philippines for as low as 0.1 percent per annum, 40 years to pay, with 12 years grace period for payment.

Batan also reported that there were 32 contracts awarded last year for railway projects, and that they plan to increase this to 58 contracts this year, and 65 by next year.

The DOTr hopes the rail projects can decongest and replace thousands of cars and jeepneys, and hundreds of buses on the road. 

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