DOTC to pursue buyout of MRT-3

MANILA, Philippines - The Department of Transportation and Communications (DOTC) plans to meet with government financial institutions Development Bank of the Philippines (DBP) and Land Bank of the Philippines (Landbank) as well as the Department of Finance (DOF) to pursue the buyout of the Metro Rail Transit Line 3 (MRT-3) from its private owner.

Transport Secretary Joseph Abaya said the DOTC intends to have a meeting with DBP, Landbank and DOF soon to discuss the buyout of the private shareholders of the MRT-3. 

The DOTC needs to get the approval of the DOF, DBP and Landbank on the planned buyout as the GFIs hold a combined 80-percent economic interest in Metro Rail Transit Corp.

“We have been wanting to execute this...They (GFIs) have certain concerns. We’re finding out what methodology to adopt to address their concerns,” Abaya said.

The GFIs have concerns over the plan as the execution of the buyout might result in a loss on their books.

Abaya said the buyout remains a priority of the Aquino administration.

“It is still a priority. We even have an executive order for that,” he said.

He said the government intends to complete the buyout of the MRT-3 by early next year.

The funding for the buyout, initially estimated to cost P54 billion, is expected to come from the 2016 national budget.

After the completion of the buyout, the decision to bid out the operations and maintenance of the mass transit system to the private sector would depend on the next administration.

While the decision is up to the next administration, Abaya is hopeful the benefits from the public private partnership (PPP) model would be considered.

The operations and maintenance of other train systems such as the Light Transit (LRT) Lines 1 and 2 have been opened to the private  sector.

Light Rail Manila Corp., a joint venture company of Metro Pacific Light Rail Corp., AC Infrastructure Holdings Corp., and Macquarie Infrastructure Holdings (Philippines) PTE Ltd., assumed operations last Sept. 12 of the LRT-1 which spans Roosevelt station in Quezon City up to Baclaran station in Pasay City.

The operations and maintenance of the LRT-2 from Santolan station in Pasig City to Recto station in Manila, meanwhile, is still under procurement.