THE feasibility study of the long-proposed 2,000-kilometer Mindanao Railway System (MRS) is targeted to be completed in the third quarter of this year and is seen to be fully completed beyond 2022.
Socioeconomic Planning Secretary Ernesto Pernia told reporters on August 18 that the Duterte administration’s plan is to start to work on the big ticket project next year.
“This, as what President Duterte said, is his big ticket, priority infrastructure project that he will push under his leadership,” Pernia said at the Second Quarter (Q2) 2016 Report on the Philippine Economy Press Conference at the SMX Convention Center, SM Lanang Premier, Davao City.
“The FS is almost done as there is a directive of the President (Rodrigo Duterte) to fast-track this specific project,” National Economic and Development Authority (Neda)-Davao director Maria Lourdes Lim said.
Pernia also said they were looking at implementing the two projects in two stages, initial stage will include the connection of cities of Davao and Cagayan de Oro.
In a report, the big-ticket project will connect major cities of Davao, Cagayan de Oro, General Santos, Butuan, Surigao, Iligan and Zamboanga.
When asked on the funding of the project, Pernia said it may be funded through various ways, including the Official Development Assistance (ODA) and public-private partnership (PPP).
Lim also said that it will be up to the investment coordinating committee of the Neda Board to determine the appropriate financing mix.
She added that they are expecting all possible sources through bilateral, Government-to-Government (G2G) arrangement or through multilateral financing.
“For the ideal funding, we have to look at standard costing. We have our consultant to do the analysis, it should yield a fair rate of return of investment at the Government of the Philippines (GOP),” Lim said.
The total project cost of the rail project is also yet to be finalized.
Pernia also shared that they are eyeing two implementing ways of the MRS -- continuous or by segment or phase implementation.
Pernia said Thursday that the governments of China, Japan, and South Korea as well as some four local giant firms have showed interest to invest in the project.
He said China is the “most eager” party to take part in financing the project.
For the local companies, Pernia said the usual prospects are in the show including Ayala Corp., Megawide Construction Corp., Metro Pacific Investments Corp., and San Miguel Corp.
But he was clear to say that these are just initial information that is yet to be finalized.
Pernia said the realization of MRS is part of the Duterte administration’s move to reach infrastructure development to the underserved areas outside Metro Manila, especially Mindanao.
The business community here lauded this plan saying this will improve development in this part of the country.
“It is a welcome development, we are hoping for this to be realized as this railway project will surely spur development here and will improve connectivity to transfer goods of the island more efficiently,” Davao City Chamber of Commerce and Industry, Inc. President, Bonifacio Tan said in a separate interview.