, December 9, 2005
(STAR) By Mary Ann Reyes - Government evaluators composed of experts in the transportation, infrastructure and investment sectors were finally convinced that the MRT 7 would be beneficial to the public, not only for its contribution to the easing of traffic conditions in Metro Manila, but for its contribution to the economy.

It is expected to attract the most investment with the most multiplier effects on the economy — about a billion dollars in equity and a billion dollars of a private debt for massive pump-priming to the Philippine infrastructure segment — more than all other projects in the pipeline at present.

The proposed 20-kilometer MRT 7 will begin its route from Tala, Caloocan City, passing through La Mesa dam reservoir, Fairview, Batasan, Diliman, Philcoa, and ending at EDSA-North Avenue.

It will serve an estimated two million population of north Quezon City and north Caloocan City. Aside from the elevated transport system, ULC will also build at no cost a 17-kilometer, six-lane asphalt access road in Marilao, Bulacan leading to its depot in Tala.

MRT 7 also includes an intermodal facility for bus riders and other road commuters to conveniently transfer to the rail system (MRT 2 and 3) that interconnects to all other rail lines. This creates an opportunity to maximize road space by limiting the number of provincial buses entering EDSA. With its operation, MRT 7 will effectively reduce the millions of vehicles on the roads of Metro Manila.

After solving the perennial transportation problems in northern Metro Manila, MRT 7 is expected to boost real estate development in the area.

Foreign investors have expressed their interest in developing real estate in the areas that will be affected by MRT 7. It is estimated that $500 to $700 million would be poured in for real estate development on top of the $1.2 billion for the railway project. The project will include the creation of a satellite city with residential houses, schools, and offices with water and power near the Tala depot.

The 195-hectare MRT 7 depot, according to ULC, will be transformed into a mixed residential-commercial property development area that will not only help decongest overpopulated Metro Manila but will transform it into a new hub.

Benefits to the government from property development alone will be essentially in the form of taxes. During the operation period, the property development project alone will provide cumulative benefits to the national government of about P30 billion over 10 years. The project MRT 7 will address the transportation needs of the populations of Quezon City, Caloocan City and Bulacan.

The rail line starts from SM City to the corner of North Avenue and EDSA, runs through Commonwealth Avenue up to Quirino Avenue and terminates at the city of San Jose del Monte in Bulacan.

It is considered to be the first intermodal mode of transportation in Asia.

A 40-kilometer highway will then connect the line from San Jose del Monte to North Luzon expressway at Marilao, Bulacan.

As a transportation project, MRT 7 will address more than 300,000 commuters from north of Metro Manila and will become a massive employment generator during and after construction.

It will also introduce a productive solution for diverting buses from EDSA and from the North Luzon Expressway clogging Balintawak in Caloocan City.

Government is also optimistic that it will be the answer to the problem of surging oil prices because it greatly reduces the public’s dependence on oil in the transportation sector. MRT 7 is expected to result in as much as $117 million in fuel savings every year.

Construction of MRT 7 is expected to begin next year. It is projected to be operational by 2009.

The DOTC expects MRT 7 to enjoy the highest ridership, starting at 668,058 and reaching to over 1.35 million at the end of the concession period.

MRT 7 proponents are committed to infusing $300 million in equity investments and raising some $900 million in loans, with only a government performance undertaking to support the same.

Apart from this, the proponents are committing to raise up to $500 million in private investments to support the real estate development aspect of the project. Need for new infrastructure The direct correlation between infrastructure spending and economic growth is beyond dispute.

According to the World Bank, each percentage point of real per capita GDP growth requires infrastructure spending of one percent of GDP.

Serious under-investment has been a factor in the Philippines’ lagging well behind its neighbors in economic progress.

During the past 25 years from 1975 to 2000, Philippines GDP growth averaged 3.1 percent per annum while infrastructure spending as a percentage of GDP was 3.2 percent during the period.

Compare this with those of the Philippines’ neighbors in the region: the proportion of infrastructure spending in Malaysia was 4.6 percent of GDP; in Thailand, it was 5.2 percent. During the same period, the respective annual GDP growth in these countries was 6.8 percent and 6.5 percent, respectively.

The problem in the Philippines is not only under-investment but also inefficiency of investment, according to a study conducted by AYC Consultants.

One main reason for the poor performance in infrastructure development is that the government and the economy as a whole have limited funds to build more infrastructure.

The passage of the build-operate-transfer (BOT) law has enhanced private sector participation in infrastructure development, as a result of which infrastructure spending rose to four percent of GDP at the start of the second half of the 1990s.

From only 22 percent in 1993-1998, the share of BOT projects to total planned infrastructure projects, in terms of cost, rose to 41 percent for 1999-2004.

The message is clear: there must be a quantum leap from the historical performance in infrastructure development if the Philippines is to have a chance of becoming a tiger economy by the end of this decade.

Naturally, the government on its own cannot be expected to raise these mind-boggling levels of investment. Unsolicited proposals, such as MRT 7, should be given a boost.

GMA wants airport service with a smile By Rainier Allan Ronda The Philippine Star 12/09/2005

Presidential displeasure over the lack of smiling faces at the Ninoy Aquino International Airport (NAIA) during a recent visit there has led the Manila International Airport Authority (MIAA) to institute a new policy: More smiling, please, among its employees and airport personnel.

This week the MIAA circulated a memorandum issued last month by MIAA general manager Alfonso Cusi, in which he commented on the lack of "friendly smiles" and "joyful disposition" at the airport and ordered MIAA personnel to promote the Filipino traits of "cheerfulness, courtesy and helpfulness."

"Filipinos have been known to be hospitable, courteous, hardworking and cheerful people. They take pride in their work, are ready to help others in need and are always warm with their friendly smiles and joyful disposition," the memo began.

"These traits of the Filipino that have earned for us distinctive recognition worldwide seem to have been wanting in our airports as the President herself noticed in her recent trips abroad," Cusi’s memo read.

The memo also announced that ballet dance troupe head and MIAA "beautification" consultant Joji Felix-Velarde would be installed as the airport’s "smile czar."

"As such, she is tasked to draw up a Customer Service Action Program that would reinvigorate these traits among NAIA personnel," the memo, signed by Cusi, read.

Airport insiders said the new "smile" campaign was launched following the President’s observations while visiting the NAIA Centennial Terminal’s presidential lounge before taking her Philippine Airlines flight to South Korea. She noticed that MIAA personnel were not smiling at her.

Chief News Editor: Sol Jose Vanzi

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