Northrail contract suspended – Roxas

MANILA, Philippines – The talks over the contract for the train system crucial in the transfer of the country’s main gateway from capital Manila to Clark in central Luzon has been suspended, Transportation Secretary Mar Roxas said.

“[The Northrail contract is] not scrapped (yet). It’s officially suspended. We are sorting through the procedures for the next steps,” Roxas told Rappler on Thursday, March 29.

The Northrail project is one of the scandalous contracts under the Arroyo administration that involved a Chinese state-run contractor. Critics have slammed it for having provisions disadvantageous to the Philippines.

A renegotiation of the botched contract was one of the key issues that President Aquino raised with Chinese officials during his state visit to Beijing in 2010.

During the inaugural ceremony of AirAsia Philippines’ flights from Clark airport on Wednesday, March 28, Roxas assured the stakeholders that President Aquino has given orders to prioritize the rail project.

“[The Northrail project] is a priority among key Cabinet officials. President Aquino said it will benefit his constituents,” Roxas shared.

President Aquino is from Tarlac province in central Luzon, which also hosts the Clark airport that sits on a sprawling land in Pampanga province.   

The Aquino government has been keen on shifting most flights from the congested Ninoy Aquino International Airport (NAIA), which could not be expanded due to physical limitations, to Clark airport. 

An airport infrastructure that could absorb the rapid expansion in the airline industry has been one of the key issues the Aquino administration promised to address given nagging complaints from passengers and officials. 

Delays

The completion of the long delayed 80-kilometer rail line from Caloocan, the northern edge of the capital, to Clark was one of the main reasons why airline passengers still have to go through NAIA where the terminals and the runway are operating beyond capacity.

The Northrail project started in 2004 when a state-owned agency, Northrail Corp, inked a $400 million loan with China’s Import-Export Bank.

However, difficulties in securing the alignment and changes to the scope of the design led to a series of delays and cost escalation which ultimately led to the suspension of work in 2008.

Some civil works have been undertaken to keep the project going, but these were halted when the Aquino government took over apparently to investigate claims of irregularities in the original contracts.

Roxas said he wanted to review and re-write the contract to ensure that the Philippine government spends public funds properly.

Alternatives being considered is the sale of the NAIA airport concept, with the proceeds to be used to fund the rail project connecting Manila and Clark.

Another is to utilize the middle portion of the existing North Luzon Expressway (NLEx) to do away with right-of-way issues.

Meantime, passengers from the capital or those who have connecting flights from NAIA have to take Clark-bound bus or private vehicles to reach Clark.

Renegotiations

Roxas said President Aquino has recently raised the Northrail project again with Chinese President Hu Jintao.

“President Aquino told his Chinese counterpart that he is committed to having a high-speed rail link between Metro Manila central business district and Clark International Airport, because that is what the country really needs, a high speed rail system,” said Roxas.

Roxas said the Philippine government is primarily seeking to revise the present contract which calls for a commuter rail system.

A high-speed rail system would cut travel time between Clark and Metro Manila by 45 minutes. A commuter rail line, with several stops to service commuters in towns it passes through, would mean a longer travel time, Roxas explained.

He said renegotiations involve new terms for funding, design and construction.

“Well, we’re really at zero, because what has been set up is a slow, old-technology commuter system built by China National Machinery and Equipment Corp. that had minimal if no experience in rail construction. So, the winning contractor assigned by China is one of the problems,” he said.

Roxas said the Chinese contractor had completed only one kilometer of the proposed 90-kilometer Northrail system. – Rappler.com