PH secures $130M loan for MRT 3 rehab

• The Philippines has signed the JPY17.4 billion (around US$130 million) loan agreement with the Japan International Cooperation Agency for the rehabilitation of Metro Rail Transit Line 3

• The rehabilitation includes provisions for capacity including rolling stock, rail tracks, signaling system, power supply system, overhead catenary system, communications system, and depot and station equipment.

• The supplemental loan for MRT-3 was approved by the National Economic and Development Authority Board on February 2, 2023 to finance the increase in the total project cost amounting to P29.6 billion, following the additional scope of work submitted by the Department of Transportation

The Philippines has secured a JPY17.4 billion (around US$130 million) loan from the Japan International Cooperation Agency (JICA) for the rehabilitation of Metro Rail Transit Line 3 (MRT-3).

The loan agreement was signed by Finance Secretary Benjamin Diokno and JICA chief representative in the Philippines Sakamoto Takema on May 26 at the Department of Finance (DOF) office in Manila, the DOF said in a statement.

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 16.9-kilometer mass rail transit system with 13 stations along the 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, communications system, and depot and station equipment.

The supplemental loan for MRT-3 was approved by the NEDA Board on February 2, 2023 to finance the increase in the total project cost amounting to P29.6 billion, following the additional scope of work submitted by the Department of Transportation (DOTr).

These include integration and capacity expansion; complete rehabilitation; operation and maintenance (O&M) concession dovetailing with the expiry of the build-lease-transfer (BLT) agreement in 2025; and 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% per annum for consulting services, to be repaid in 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 $10.4 billion, including loans and grants.

Following the signing of the loan agreement, Japan’s total loan net commitment now amounts to around $10.3 billion, with a total ODA commitment of $10.5 billion.

Two loans amounting to JPY377 billion ($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) and the NSCR Extension Project.