Archive for the ‘News’ Category

MRT firm hits back at DOTC

Philippine Daily Inquirer, 13 February 2014

By Miguel R. Camus


MANILA, Philippines—The private sector group behind the Metro Rail Transit (MRT) Line 3 elevated railway in Metro Manila hit back at the government on Wednesday, criticizing the transportation department’s “lack of maintenance operations.”

The latest development in an ongoing word war between the consortium behind MRT 3’s operator, MRT Holdings Corp., and the Department of Transportation and Communications (DOTC) came ahead of a court hearing for an injunction with a temporary restraining order to stop a deal between the government and a Chinese company to supply badly needed train cars for MRT 3.

The Makati Regional Trial Court has set the hearing Thursday.

MRT Holdings spokesman David Narvasa said in the statement that DOTC should focus on ensuring the safety of the MRT 3 coaches “instead of insisting on illegally procuring 48 light rail vehicles from CNR Dalian Locomotive & Rolling Stock Co.” He reiterated that this was a violation of the existing build-lease-transfer agreement between the government and MRT Corp.

“DOTC should address the main issue of its role as lessee under the BLT agreement instead of pushing for the award and delivery of light rail vehicles outside the terms and conditions of the BLT agreement,” he said.

Narvasa cited the DOTC’s track record in maintaining LRT-1, with less than 65 percent of the trains available for operations.

“The MRT group also made several proposals to acquire additional LRVs from before 2007, and the 2010 proposal of Metro Pacific Investment Corp. to supply additional trains at no cost to the government—all remain in limbo and have not been responded to by DOTC,” Narvasa said.


Government pulls out flagship agriculture PPP projects

Business Mirror, 13 February 2014

By Cai U. Ordinario


THE Department of Agriculture (DA) has pulled out all its projects initially designed to become public-private partnership (PPP) undertakings.

PPP Center Executive Director Cosette Canilao said this means the two DA PPPs have been removed from the country’s PPP pipeline.

Canilao identified these as the P400 million worth Grains Central Project and the P693.4 million worth Establishment of Cold Chain Systems Covering Strategic Areas in the Philippines project.

Canilao said the DA plans to undertake these projects, which are both key in the country’s goal of attaining food self-sufficiency, through government and locally funded means.

“The sites identified for the cold chain are already included in the DA’s other programs. As to the grains, I believe the DA decided to course it through Nabcor [National Agribusiness Corp.] or another attached GOCC [government-owned and -controlled corporation] through a JV [joint-venture] arrangement. I do not know how that progressed,” Canilao told the BusinessMirror on Thursday via mobile-phone text.

In place of these two projects, Canilao said the Economic Development Council  has instructed the PPP Center and the DA to explore PPP projects in irrigation facilities, particularly in the construction of these facilities and the provision of equipment such as water pumps.

Canilao said the PPP Center would be meeting with the National Irrigation Administration soon to discuss possible projects and the mechanics of these PPPs.

One irrigation project already identified by the DA prior to pulling out the Grains and Cold Chain PPPs, was the spin-off the hydropower and domestic water-supply components of the Jalaur River Muti-Purpose Project Stage 2 into a PPP.

The DA said last year that it might seek funding from the PPP Center to conduct the feasibility study for the project through the Project Development and Monitoring Facility.

Initially, the Grains Central Project involved the rehabilitation, upgrading, expansion and operation and management of 11 existing Post-Harvest Processing and Trading Centers.

These are currently managed and operated by the Nabcor in different regions in Luzon and Mindanao.

The cold chain PPP project was initially envisioned to be directly managed by the DA, intends to reduce postharvest losses and maintain an inventory of quality perishable goods, stabilize food-prices and promote food safety consciousness.

The project initially involved the construction and operation of Cold Chain Centers in major production and consolidation areas of agri-fishery products of the Benguet-Manila cold chain route.

Activities include the following: pre-cooling, packaging, handling, transportation, storage, and distribution, among others, for high-value crops, such as fruits and vegetables, cut flowers, fishery, livestock and poultry meat products.


Metro commuters deserve modern rail ticketing system

Manila Standard Today, 13 February 2014

By Rey S. Eñano


Rail commuters waiting in long queues as early as five o’clock in the morning will have to endure their daily toil. A new rail ticketing system aimed at partially easing the suffering of commuters is not forthcoming yet.

The Transportation Department has dilly-dallied on the awarding of the automatic fare collection system contract, as losers in the just-concluded auction are out to derail the P1.72-billion project.

The rail ticket project was originally envisioned  to start on September 2013, with the intricate system development to be crafted by a battery of software analysts and engineers until September this year. The project will undergo a so-called sub system approval levels throughout the third quarter this year before the full-systems go-signal in November and full operations by January next year.

The system, a public-private partnership program of the government, seeks to unify the ticketing system in LRT-1, LRT-2 and the MRT-3 lines. It will substantially lessen queuing time and allow seamless transfers from one rail line to another. The project involves the decommissioning of the present magnetic-based ticketing system and replace the same with a “contactless-based smart card technology.”

The PPP center on January 30 announced the notice of award to the AF Consortium of conglomerates Ayala Corp. and Metro Pacific Investments Corp. AF submitted the highest premium offer of P1.08 billion, or P103,900 higher than that of a consortium led by the SM Group.

Five consortiums prequalified to bid for the project, with two (E-Trans Solutions Joint Venture Inc., and Megawide Construction Corp.) disqualified for failing the technical evaluation. E-Trans complained later about its disqualification and asked Transportation to open its financial bid, which the government agency denied.

Another bidder, meanwhile, questioned the Transportation decision, saying the offer of the AF Consortium was “conditional.” The losing bidder in a published statement contended that the AF Consortium’s bid of P1,088,103,900 entailed certain conditions.

The first step

Ayala Corp. also received a flak from its critics, who linked the success of the company in obtaining multi-billion peso deals under the Aquino administration to its political clout.

Critics can throw all their accusations against the winning tandem of Ayala and Metro Pacific but they are not solving the daily woes of commuters.

The rail ticketing system will not effectively solve congestion in and the dilapidated state of the LRT-MRT train system. Only the addition of new railways and technical upgrade of the whole system can address the problem. But these options are still several years away.

The new ticketing system is actually the first step in a long journey to ease the problems of commuters in the LRT and MRT. Envisioned to be like Hong Kong’s Octopus Card, the AFCS ticketing system will serve as a debit card, aside from being a stored-value train ticket. The single ticket could also be used for other modes of transportation such as buses, paying toll, electronic banking, and even shopping.

It ensures seamless interconnection for travelers and removes the current inconvenience of the need to buy separate tickets for different rail lines.

The new smart card ‘tap-and-go‘ system would replace the current magnetic-based ticketing system that is nearing the end of its usability. The new card could also serve as an electronic micropayment solution in convenience stores, or as identifier for loyalty schemes, facility access and location-based services, as well as other transport modes, including buses and taxi cabs. In sum, the system will modernize the country’s transport systems and lessen the day-to-day confusion and discomfort of commuters.

Meanwhile, criticisms hurled against the winning bidder—from the supposed clout of the Ayala and Metro Pacific conglomerates with the Aquino administration to the ongoing arbitration case in Singapore between the government and Metro Rail Transit Corp.—are not clarifying the true design of the PPP project.

The arbitration case, for one, has no relevance to the project as the issue concerns the shareholders of MRTC and the Philippine government. It will be settled by the courts and has nothing to do with the ticketing system or the AF Consortium.

Commuters should have the last say on the automatic fare collection system.



Ecorail Transport to bid anew for LRT 1 Ext project

The Philippine Star, 13 February 2014

By Lawrence Agcaoili


MANILA, Philippines – One of the disqualified bidders of the proposed extension of the Light Rail Transit line 1 (LRT1) all the way to Cavite will participate again in the bidding for the Aquino administration’s largest public private partnership (PPP) project.

Cosette Canilao, executive director of the PPP Center, said Ecorail Transport Service Inc. of businessman Reghis Romero II bought bid documents for the P65-billion Light Rail Transit (LRT) Cavite extension project.

“The new entity that bought LRT1 bid documents is Ecorail,” Canilao said in a text message to reporters.

Ecorail was disqualified by the bids and awards committee (BAC) of the Department of Transportation and Communications (DOTC) after it failed to submit its 10 copies of their prequalification documents on time last Oct. 22, 2012.

Companies that have expressed interest in the rebidding for the project were the tandem of conglomerate Ayala Corp. and infrastructure giant Metro pacific Investments Corp. (MPIC) through the Light Rail Manila consortium, SMC Infra Resources Inc. of diversified conglomerate San Miguel Corp. (SMC), construction giant DMCI Holdings Inc., and Malaysian-owned MTD Philippines Inc. that were prequalified during the previous failed bidding last Aug. 15.

In addition, the DOTC spokesman Michael Arthur Sagcal earlier said new players led by Globalvia Inversiones of Spain and Megawide Construction Corp. have also indicated interest in the tender.

The DOTC is giving interested bidders until April 28 to submit their bids for a single-stage bidding wherein interested groups would submit their qualification documents simultaneously with their technical and financial proposals to shorten the process by at least two months.

It would be recalled that the DOTC and the Light Rail Transit Authority (LRTA) declared a failed bidding after only one of the four prequalified bidders – Light Rail Manila Consortium led by MPIC – submitted a bid last Aug. 15 while other major proponents backed out due to concerns about the viability of the project.

Only the Light Rail Manila consortium minus Ayala Corp. submitted a conditional bid while MTD-Samsung Group, San Miguel Infrastructure, and DMCI Holdings withdrew from the process due to concerns including on who would shoulder the real estate taxes.


Romero’s Ecorail guns for LRT-1 PPP anew

GMA News, 12 February 2014

By Siegfrid Alegado


Ecorail Transport Service Inc. of businessman Reghis Romero II is going to try its luck anew in winning the Light Rail Transit Line 1 (LRT-1) extension to Cavite province, the government’s most expensive public-private partnership (PPP) project.

“The new entity that bought LRT-1 bid documents is Ecorail,” said Cosette Canilao, executive director at PPP Center, the agency overseeing the projects under the flagship program.

Ecorail was earlier disqualified by the Department of Transportation and Communications from the P63.55-billion project for failing to beat the submission deadline for documents.

The company joins the other prospective bidders for the project:

  • Light Rail Manila consortium of Ayala Corp. and Metro Pacific Investments Corp.
  • SMC Infra Resources Inc. of diversified conglomerate San Miguel Corp.
  • DMCI Holdings Inc.
  • Malaysian-owned MTD Philippines Inc.
  • Spain’s  Globalvia Inversiones
  • Megawide Construction Corp.

The LRT-1 Cavite extension PPP is going through a rebidding after the government last August 15 received a conditional and non-compliant bid from Metro Pacific Investments Corp., the lone bidder, which went for it without partner Ayala Corp.

Interested firms have until April 28 to submit bids.

So far, six projects worth an estimated P45.08 billion have been awarded since the infrastructure program was unveiled in November 2010.

This includes the Transportation Department’s P1.72-billion automation and integration of the Metro Manila railway ticketing system, the first PPP project awarded by the government. – Siegfrid Alegado, GMA News


Ecorail bids anew for LRT1 Cavite extension project

InterAksyon, 12 February 2014

By Darwin G. Amojelar


MANILA – A company affiliated with businessman Reghis Romero 2nd has expressed interest again to join the bidding for the P64.9 billion Light Rail Transit Line 1 (LRT 1) Cavite Extension Project.

Cosette Canilao, Public Private Partnership (PPP) Center executive director, said Ecorail Transport Service has purchased bid documents for the LRT Line 1 Cavite Extension Project.

In the August bidding for the LRT Line 1 Cavite Extension, Ecorail failed to make it to the 2 p.m. deadline for the submission of the pre-qualification documents.

Besides Ecorail, companies that recently bought bid documents were the Light Rail Manila Consortium led by Metro Pacific Investments Corp (MPIC) and Ayala Corp.,  SMC Infra Resources Inc, Globanvia Inversiones S.A.U., Megawide Construction Corp, MTD Philippines Inc, and DMCI Holdings Inc.

The auction last year failed after only one bidder, the Light Rail Manila Consortium, submitted an offer. The Department of Transportation and Communications (DOTC) Bids and Awards Committee, however, turned down the lone bidder’s offer after it contained conditions that the government deemed unacceptable.

The three other pre-qualified parties withdrew from the tender in August, pointing out that the terms of the contract render the deal financially unviable. The government has since revised the terms, providing “sweeteners” to make it more attractive to bidders.

In a general bid bulletin, the DOTC informed the prospective bidders that that the viability gap funding for the LRT Line 1 amounted to P6 billion.

Canilao said that the viability gap funding means partial financial support to the project.

“That’s the maximum amount. The bid parameter would be the lowest viability gap funding,” she added.

The DOTC earlier said the deadline for bids is slated on April 28 and the opening of the financial offers is in May. With this timetable, the concession agreement will likely be signed in July.

The project should be completed and operable 54 months from signing date or by December 2018.

The agency had announced that it would pursue a single-stage bidding, which means interested groups will submit their qualification documents simultaneously with their technical and financial proposals, thus doing away with a separate pre-qualification phase. This will cut the bidding process by around two months.

This is the second time the government will auction off the project, one of the Aquino administration’s public-private partnership (PPP) ventures.

According to the DOTC, more than 500,000 commuters everyday use LRT 1, which runs from Baclaran in Pasay City to Roosevelt in Quezon City.

The southern part of Metro Manila and neighboring Cavite province is home to nearly four million people.


Disqualified bidder wants another go at LRT-1 Cavite project

ABS-CBN News, 12 February 2014


MANILA, Philippines – Businessman Regis Romero II is making another bid for the Light Rail Transit (LRT) Cavite extension project.

Cosette Canilao, executive director of the Public Private Partnership Center, said Romero’s Ecorail Transport Service has bought documents for the LRT Cavite extension project.

“The new entity that bought LRT-1 bid documents is Ecorail,” Canilao said in a text message to reporters.

Last October 2012, Ecorail was disqualified by the Department of Transportation and Communications (DOTC) bids and awards committee after failing to submit 10 copies of pre-qualification documents on time. Ecorail had tied up with China Railway Construction Corp. for the project.

Ecorail had also filed a petition for certiorari, prohibition, and mandamus, with application for the issuance of a temporary restraining order and writ of preliminary injunction against the DOTC and the Light Rail Transit Authority (LRTA) before the Supreme Court to stop the bidding process.

The LRT-1 Cavite extension project has attracted interest from the country’s top companies, such as Ayala Corp. and Metro Pacific Investments Corp.’s Light Rail Manila Consortium; SMC Infra Resources; DMCI Holdings, Megawide Construction, as well as Malaysia’s MTD Philippines and Spain’s Globalvia.

Interested bidders for the LRT 1 Cavite extension project have until April 28 to submit bids.

The DOTC is expediting the bidding process for the project by adopting a single-stage bidding process. It also improved certain economic terms in the concession after the bidding for the project failed last August.

The improvements include government absorbing the obligation to pay real property taxes, ensuring the integrity of the facility’s structure for a 2-year period, permitting a 5 percent fare increase upon completion of the project, and allowing the submission of negative bids.

The P65 billion LRT-1 Cavex project involves the construction of an 11.7-kilometer southward extension from the Baclaran station to Bacoor, Cavite, and the construction of 8 new stations, plus more stations in Parañaque City, Las Piñas City, and Cavite in the future.


PPP Center upgrades list of experts under $90-M facility

GMA News, 12 February 2014

By Siegfrid O. Alegado


A fresh list of consultants for big-ticket infrastructure projects under the flagship public private partnership (PPP) initiative is being eyed to attract more investors, an official of the agency overseeing the program said.

“Seasoned consultants and transaction advisors are very important in developing viable and bankable PPP projects,” Cosette Canilao, executive director at the PPP Center, said in a text message to GMA News Online on Wednesday.

“Investors are more comfortable in participating in our PPP bids when experienced consultants and experts advise the government,” she added.

On Monday, the PPP Center asked interested companies to pre-qualify for the panel, which will be funded through the Project Development and Monitoring Facility (PDMF).

Made available for the panel was $90 million which consisted of government funds and aid from the Australian government under a Capacity Development Technical Assistance from the Asian Development Bank.

The PDMF framework commissions technical advisors composed of international and local consulting companies for the state agencies and local governments that would tap the facility.

From an initial nine consortia of consulting companies in 2011, the panel has expanded to 15 in 2012, according to the PPP Center website.

“There is no cap as to how many firms we are going to admit for the new panel for the PDMF,” Canilao said in the text message.

The deadline for applications is on March 22.

The pre-qualified consulting companies will be retained on without commitments for two years to support the preparation and transaction of PPP projects. – VS, GMA News

Public-Private Partnership: Nepal can learn from others

The Himalayan Times, 11 February 2014



Since several PPP projects have been developed worldwide‚ Nepal should learn the lessons and develop suitable models in its own context. Nepal does not need to experiment with PPP but it can develop its strategies on the basis of other countries’ experiences

Infrastructure deficits in Nepal are hampering economic growth as well as inclusiveness as far as the poor are concerned. Currently Public Private Partnership (PPP) is much discussed worldwide and is recognized as a useful tool to deliver infrastructure projects through the joint effort of public and private sectors. Governments of developed as well as developing countries are facing financial constraints to deliver infrastructure as demanded because government funds are limited and need to cover all of the various services provided by the state. Government funds must cover a wider range of sectors like poverty alleviation, water supply, power supply, waste management, road, rail, airports, education, and health. If infrastructure could be delivered through private funding, the government could concentrate on other social sectors to improve living conditions of the people. The concept of PPP has been developed as a means to use the finance and technical know-how of the private sector. Big hope is laid upon PPP worldwide.

PPP in general is an agreement between public and private sectors to deliver public infrastructures using each other’s competencies, strengths, and experiences to achieve common objectives. In PPP both sectors must have a common vision.

PPP projects have been showing positive results in developing as well as in developed countries. According to the report of accelerating PPP in India, the PPPs in UK have been highly successful and an assessment of the UK PPP policy in 2009 showed that 65% of the PPP contracts were delivered on time and within the agreed budget. The same report presented that Australia, Brazil, and Philippines have well developed PPP structure and policies and there is a growing focus in these nations to develop infrastructure under PPP. According to Hemant Kanoria, Chairman of FICCI National Committee of Infrastructure India, PPPs in India have shown good progress in some sectors while others achieved only limited success. There have been successes as well as failures of PPP but most of the countries are learning from the failures and moving forward with PPP projects. The Nepalese government has also realized the importance of PPP in Nepal. In this regard the GoN has put forward PPP policies and acts to facilitate project development of infrastructure projects under the PPP model.

Infrastructure is the basis for economic development. Infrastructure alone, however, does not ensure economic growth but it is certainly a catalyst that accelerates economic activities. It is widely accepted that infrastructure is a prerequisite for economic prosperity. Nepal´s infrastructure is inadequate and underdeveloped to promote economic growth. Therefore, there is an urgent need to develop infrastructure in Nepal at the earliest. It is a well accepted truth that Nepal lacks adequate infrastructure and the responsible authorities have well developed plans to develop infrastructure, but where should the funding come from? GoN is determined to develop the infrastructure but lacks required resources to finance such projects. This situation has compelled GoN to implement PPP projects.

PPP is neither privatization nor partial privatization. Privatization is shifting the ownership/management of the facilities from government to the private sector in whole or part but in PPP the facilities may be transferred to the private for the contracting period only. After the expiry of the contract the facility will be automatically transferred back to the government. PPP uses the strengths of both the private and the public sector in terms of planning, design, construction, financing, operation, management, and maintenance.

The private sector has the incentive to operate, manage and maintain the facilities efficiently and innovatively as much as possible in order to cut costs and improve profits. Mostly, private sector know-how is added to the public sector in delivering infrastructure projects. Sharing of risk is another critical success factor of PPP: risks are allocated to the party that can most efficiently manage them at the lowest possible costs. For the private sector, investing in PPP projects is like investing in business. PPP projects are secure for investment because of the involvement of the government.

PPP projects are challenging; there are lots of failure experiences with this model. For instance, in Hungary in 1993, a road link between Budapest and the Austrian border was built under the PPP model.

After the operation of the toll road, the project failed because the traffic and the use of the toll road was only half the amount that was forecast by the investor (Najja Bracey). PPP projects have lots of associated challenges like cost of capital investment assumption, traffic forecast, accepted toll rate, politics, and economic volatility, all of which need to be assessed carefully before commencing PPP projects. Since several PPP projects have been developed worldwide, Nepal should learn the lessons and develop suitable models in its own context. Nepal does not need to experiment with PPP but needs to learn from others’ successes and failures and develop strategies that are necessary for success.

3 more eye bus terminal proj

The Philippine Star, 11 February 2014

By Lawrence Agcaoili


MANILA, Philippines – Three more companies are keen on participating in the bidding for the proposed P2.5 billion Integrated Transport System (ITS) Project – Southwest Terminal under the Aquino administration’s public private partnership (PPP) scheme.

PPP Center executive director Cosette Canilao said Ayala Corp., Filinvest Land, and Megawide Construction Corp. bought bids documents for the project.

This brought to 10 the number of companies interested in the PPP project.

Interested bidders include diversified conglomerate San Miguel Corp., property giant Ayala Land Inc., Metro Pacific Tollways Corp. of infrastructure giant Metro Pacific Investments Corp., Robinsons Land Inc. of taipan John Gokongwei, D.M. Wenceslao and Associates Inc., Vicente T. Lao Construction, and French-owned Egis Projects Philippines.

“It just validates that the PPP program is really successful and that all the biddings that we conduct and the rules are transparent. Hence we continue to attract more bidders for all our PPP projects,” she said.

The Department of Transportation and Communications (DOTC) has given interested companies until May 15 to submit their bids for the 2.9-hectare Southwest Terminal project located at the Coastal Road Terminal along the Manila-Cavite Expressway.

The terminal would connect passengers coming from Cavite to other urban transport systems such as the future Light Rail Transit Line 1 (LRT) South Extension to Bacoor in Cavite, city bus, taxi, and other public utility vehicles plying Metro Manila.

The project would include a passenger terminal building, arrival and departure bays, public information system, ticketing and baggage handling facilities and park-ride facilities.

The DOTC pointed out that the proponent would finance, design, construct, operate, and maintain the ITS project for a period of 35 years.