DBM gives nod for Cebu BRT project's funding requirement-A A +A
Wednesday, August 27, 2014
MANILA -- The Department of Budget and Management (DBM) has approved the funding strategy of P9.48 billion for the Cebu Bus Rapid Transit (BRT) project, an official said Wednesday.
Budget Secretary Florencio Abad said his office also issued a Forward Obligational Authority (FOA) to the Department of Transportation and Communications (DOTC) for the project.
The new bus transit—which will be funded through loans from Agence Francaise de Development (AFD), the International Bank for Reconstruction and Development (IBRD), and the Clean Technology Fund—will provide a safer, more efficient, and environment-friendly mode of travel in and around Cebu City.
"We want to enhance urban mobility in Cebu by establishing a high-quality, viable and sustainable bus rapid transit system. Once completed, the project will give Cebu's commuters a fast, comfortable and cost-effective mode of transportation. The main idea here really is to emulate a modern rail-based transit system at a much lower cost," Abad said.
"This Forward Obligational Authority will allow the government to process the loans for the project. The FOA will also help us in avoiding unnecessary commitment fees along the way," he added.
(Infographics by: Mariz Puyo)
As approved by the National Economic and Development Authority (Neda) Board, the Cebu bus rapid transit system will be undertaken this year and finished in 2018, with a total project cost of P10.62 billion.
The FOA covers P9.48 billion of this amount—a combination of the national government contribution and loan proceeds—in accordance with the approved funding strategy submitted by the DOTC.
The remaining P1.14 billion will be shouldered by the private sector and will be mainly utilized for the purchase of necessary motor vehicles.
"Aside from improving public access to transportation, we also want to further stimulate the economic activity in the city. The implementation of the project alone will open various employment opportunities for the construction and manufacturing sectors. The Cebu Bus Rapid Transit—among the provision of other economic services nationwide—represents the Aquino administration's efforts to cultivate a more vibrant economic environment for cities outside Metro Manila," Abad said. (SDR/Sunnex)