MANILA, Philippines — The Japan International Cooperation Agency (JICA) has extended a ¥38.1 billion loan to the Philippines for the improvement and rehabilitation of the Metro Rail Transit (MRT) Line-3 System.
Finance Secretary Carlos Dominguez, on behalf of the Philippine government, and JICA senior vice president Yasushi Tanaka signed the loan agreement for the MRT-3 Rehabilitation Project Thursday.
This happened right after Foreign Affairs Secretary Teodoro Locsin and Japanese Ambassador to the Philippines Koji Haneda signed the Exchange of Notes on the Japanese loan on Wednesday.
Under the agreement, JICA will provide a ¥38.1 billion (about P18.76 billion or $362 million) loan to partially fund the MRT’s rehabilitation which is estimated to cost P21.96 billion (approximately $413 million).
The loan carries an interest rate of 0.10 percent per annum for non-consulting services and 0.01 percent per annum for consulting services, with a maturity period of 40 years inclusive of a 12-year grace period.
Dominguez thanked Japan for its “generous financing support” for the project and for moving fast to immediately get the rehabilitation of the MRT-3 started.
He said the Philippines and Japan fast-tracked the processing of the loan, taking a record time of less than three months, given the urgent need for the rail system’s improvement.
“This is by far the fastest loan processing we have completed,” Dominguez said.
The MRT-3 rehabilitation project aims to improve the safety, reliability and level of service of the 16.9-kilometer light rail system with 13 stations spanning EDSA.
Dominguez said the project would address the problems of the decrepit MRT-3 system in the “most comprehensive fashion” through the replacement of all worn-out tracks, upgrading of the train’s obsolete signaling system, and general overhaul of the 72 light rail vehicles that are already 15 years old.
He said the rehabilitation project would result in the expansion of the MRT’s current degraded capacity and modernization of all its subsystems.
The finance chief said the project is expected to increase the number of operating trainsets for MRT-3 from 15 to 20 during peak hours, with time intervals of train arrivals reduced by half from seven minutes to only three-and-a-half minutes. He said the project also aims to increase the trains’ speed from 30 kilometers per hour to 60 kph.
“I would like to assure our harried commuters that we will rebuild and reinvent this vital rail service as quickly as possible,” Dominguez said.
JICA, for its part, said the assistance is part of the institution’s efforts to promote seamless mobility in the country.
“This is good news for the Filipino commuters so they will have improved access to safe and reliable transportation, while also meeting the Philippine government’s priorities to reduce traffic congestion in Metro Manila, attract investments, and improve the quality of life of the people,” Tanaka said.
The Department of Transportation has also confirmed that it will tap the service of Sumitomo-Mitsubishi Heavy Industries, the original maintenance provider of MRT-3, for the project.
Sumitomo started the project implementation last Oct. 15 even before the loan agreement was signed to help accelerate the process of rehabilitating the rail system.