CLARK FREEPORT – Budget Sec. Florencio Abad said that the former Chinese contractor for the frozen North Luzon railways project (Northrail) would be paid for its work already finished from Caloocan City to Malolos, Bulacan.
However, the Aquino government is renegotiating with the Chinese government so that the project could again be bidded out to qualified contractors in China.
In an interview here, Abad said the Aquino government will continue with the Northrail project which was frozen early this year amid conflicts with the Chinese contractor Sinomach, which used to be known as China National Machinery and Equipment Corp. (CNMEC).
Sinomach, however, was able to finish the construction of some 800 concrete piles driven into the ground to make way for the tracks over rough terrain and soft grounds.
These structures are part of Phase I of the project whose cost, arising from delays, had jacked up from the original $403 million to $602 million from a loan from China.
Phase 2 is supposed to be from Malolos to the Diosdado Macapagal International Airport (DMIA) at Clark freeport where clearing of pathway and resettlement of thousands of families along the railway have been completed up to Clark.
Abad said Transportation and Communications Sec. Mar Roxas plans to continue with Northrail. “It just needs renegotiation, and (Sinomach) will be paid for the finished parts,” he added.
“But the contract (with the Chinese government) will have to be reconfigured and there will again be bidding in China among different Chinese contractors,” he noted.
He said the project would still be covered by a repackaged loan from China with the Philippines providing the usual counterpart for land acquisition, land development and “horizontal development.”
The loan for Phase I was covered by an executive agreement signed with Chinese officials by former Pres. Arroyo way back in 2004.
Funds for Phase II from Malolos to Clark were not yet released by the time the project was frozen under the Aquino administration.
Angeles City Mayor Edgardo Pamintuan, who acted as president of the North Luzon Railways Corp. for 18 months starting in 2009, admitted that the project took off only when he assumed post, as he resolved conflicts on design and other issues with the Chinese contractor who had at one time abandoned the project.
The Northrail project was announced way back during the term of former Pres. Ramos after he issued an executive order in 1994 declaring the Diosdado Macapagal International Airport as the “future site of the country’s premiere gateway.”
Airport officials agree that the Northrail was a vital factor in convincing more airlines to establish regular domestic and international flights from the airport.
“The Department of Transportation and Communications (DOTC) has the biggest share from the P22.5 billion government counterpart funds for Public-Private Partnership (PPP) projects in 2012,” he said, noting that of the top 10 priority projects of the administration, seven are in the scope of DOTC.
At the same time, Abad also said that the Department of Education’s share from the P22.5 billion fund has been increased to P5 billion amid its plans to construct 45,000 classrooms in 2012. Some 30,000 of these classrooms are to be built under the PPP, he added.
He also said that the Department of Health would get some P3 billion for counterpart funds under its PPP projects involving the upgrading of district and other government hospitals.
