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Thursday, July 25, 2024

Build Build Build’s road and rail projects

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All that has been said and written about the Duterte administration’s Build Build Build program—the “golden age of infrastructure”—has centered on the rehabilitation of the Ninoy Aquino International Airport (NAIA), the expansion of a number of other major airports and the construction of the nation’s first subway system. But these projects by no means constitute the total of infrastructure projects to be implemented between 2018 and 2022 under the Build Build Build program. The program includes a number of major road and rail projects.

These road and rail projects are Philippine National Railways (PNR) North Rail, PNR South Rail, the Luzon Spine Expressway and Mindanao Rail. These and the rest of the Build Build Build projects are estimated to cost P3.6 trillion and raise the contribution of infrastructure spending to GDP (gross domestic product) from an estimated 5.4 percent in 2017 to 7.4 percent in 2022.

PNR North Rail, which has a price tag of approximately P225 million, will connect Manila’s Tutuban Station to Pampanga’s Clark International Airport, a distance of 100 kilometers. The 350,000 passengers who are expected to use the line daily will complete the Tutuban-Clark journey in 55 minutes.

PNR South Rail, which will connect Manila with the Bicol region, will be made of two stretches. The first stretch, from Manila to Los Banos  – a distance of 75 kms – will be able to accommodate up to 400,000 passengers daily upon its completion in 2022.

The Luzon Spine Expressway is a more ambitious undertaking, for it will start in La Union and end in the Bicol region. It will encompass road projects that are already underway – including the project that will link NLEX (the North Luzon Expressway)and SLEX (the South Luzon Expressway). When the Luzon Spine Expressway is completed, travel time between La Union and the Bicol region will be reduced to under 12 hours.

Mindanao Rail will be a colossal project. For one thing, there is the distance that it will cover: the 2,000 miles between Tagum and the cities of Davao and Digos. For another, there is the project’s price tag: P32 billion. Expected to be completed in 2021, Mindanao Rail will be able to carry 117,000 passengers daily. The travel time between Tagum and Digos will be reduced to just an hour.

These road and rail projects are ambitious but necessary overdue. They will do much to increase the pace of economic development in the areas that they are intended to cover. This is particularly true of Mindanao Rail, which will operate in an area that so badly needs a massive injection of economic stimulus.

The timetables – completion by 2021 in most cases – are scary. The project costs are even scarier. Adequately financing the projects will require heavy borrowing – domestically as well as externally – of both the hard and the concessional kind.

Will the Duterte administration be able to deliver on the roads-and-rails component of its Build Build Build program? I very much doubt it. Infrastructure projects require long planning-and-startup periods, and the bigger the projects, the longer the needed planning-and-startup periods.

There are only four years left in President Duterte’s term, and the last years will be highly charged politically.

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