Government billed P1.8 billion for railway delays
A change in railway strategy is becoming more imminent for the Department of Transportation (DOTr), as delays in big-ticket projects have required the payment of P1.8 billion to lenders.
In the Philippines, the Department of Transportation (DOTr) is contemplating a change in railway strategy due to delays in major projects, leading to the payment of P1.8 billion to lenders. Acting Transportation Secretary Giovanni Lopez has directed rail officials to complete pre-construction works, particularly on right-of-way (ROW), before applying for loans.
As of July, the government had accrued commitment fees of up to P1.76 billion from lenders, who charge based on unused loan portions. This compels borrowers to utilize their loans efficiently and complete projects promptly. However, Lopez noted that commitment fees on rail projects have been increasing annually due to ROW delays.
The DOTr aims to avoid these fees by ensuring projects stay on schedule. The first project the DOTr intends to test this new approach on is the Metro Rail Transit Line 4 (MRT-4), a 12.7-kilometer line between Ortigas and Taytay, Rizal. The ADB will provide a $1 billion loan for MRT-4, complemented by a $650 million loan from the Asian Infrastructure Investment Bank.
However, the ADB's latest data sheet delays the approval until March 2030, providing the DOTr more time to finish engineering design and site acquisition. The DOTr is also working on the North-South Commuter Railway (NSCR) and the Metro Manila Subway Project (MMSP), both expected to be completed in the early 2030s. The MRT-4, despite being smaller, will address commuting demands in the Ortigas-Rizal corridor, reducing travel time between Taytay and Ortigas to 30 minutes from three hours.
To expedite this, the DOTr is considering an exclusive bus lane in Ortigas, with plans to establish busways on C5 Road and Quezon Avenue as well.
Written by urgent.news from Philippine Star Business's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
