EconomyEditor's PickMRT-3 privatization plan to undergo consultations — DoTr

November 8, 2022
PHILIPPINE STAR/ MIGUEL DE GUZMAN

THE DEPARTMENT of Transportation (DoTr) on Tuesday vowed to be transparent in the planned privatization of the Metro Rail Transit Line 3 (MRT-3), saying it will undergo consultations with various stakeholders.  

“DoTr is now studying several options for what to do with MRT-3 when it is turned over to the government,” Transportation Undersecretary for Railways Cesar B. Chavez told BusinessWorld in a phone message.  

The build, lease, and transfer agreement with the Sobrepeña-led Metro Rail Transit Corp. is set to expire in 2025, according to the transport official.  

“Among the options are privatization of operations and maintenance (O&M), a concession agreement similar to LRT Line 1 (LRT-1) with Light Rail Manila Corp. (LRMC), government continuing the operation but the maintenance will be provided by the private sector, etc.,” he added.  

He stressed that the department has yet to choose a specific course of action on MRT-3. 

“It will undergo several processes, including consultations with stakeholders and NEDA (National Economic and Development Authority) approval,” he noted.  

Sought for comment, Rene S. Santiago, former president of the Transportation Science Society of the Philippines, pointed out that the concession for LRT-1 was different.   

“The private company put up money to design and build the extension from Baclaran to Bacoor. They have skin in the game,” Mr. Santiago said in a phone message.   

“The worst kind of privatization is privatized maintenance, with the government operating. That will be almost the same as the current setup,” he noted.  

The Management Association of the Philippines has said the DoTr should look into the privatization of MRT-3, as well as LRT-2, Philippine National Railways, and EDSA busway under a “hybrid mode.”  

Under the hybrid mode, the government will provide the infrastructure, while a private concessionaire will operate the service and maintain the facilities under an O&M concession.  

“Until they honor the contract with LRMC on LRT-1, no privatization or PPP (public-private partnership) deal will succeed,” Mr. Santiago also said, referring to the recent arbitration case filed by LRMC against the government for “non-compliance on key contract provisions, including fare adjustments.” — Arjay L. Balinbin

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