Japan is loaning the Philippines 21.6 billion yen or roughly P8.15 billion for the continued rehabilitation of Metro Rail Transit Line 3 (MRT-3) to address what Tokyo said is a series of operational interruptions and other issues.
Department of Foreign Affairs (DFA) Secretary Ma. Theresa Lazaro and Japanese Ambassador to Manila Endo Kazuya signed and exchanged notes on Wednesday, Feb. 4, for the Phase III of the MRT-3 Rehabilitation Project as the former cited that "urban mobility remains one of the most pressing challenges faced by our rapidly growing cities" in the country.
"Today’s Exchange of Notes reflects the trust and cooperation between our two countries and strengthens our confidence as we move forward together," Kazuya said in his speech.
According to the embassy, the project involves providing a loan to the Philippine government to refurbish the MRT Line 3, which experienced a series of operational interruptions and other issues.
"By rehabilitating the MRT Line 3, the project aims to improve the safety and comfort of the railway, promote increased usage of the line, and contribute to alleviating the severe traffic congestion in the metropolitan area," it said.
Meanwhile, the DFA said the project aims to restore the MRT-3 to its original as-designed condition to ensure high-grade infrastructure performance and enabling future capacity expansion through comprehensive rehabilitation and upgrading of critical components.
It will involve the replacement of rails in the mainline; general overhauling of 72-CKD Tatra LRVs; procurement of bogie frames and bogie assemblies; restoration, renewal or upgrade of subsystems, including the tracks, signaling system, power supply system, overhead catenary system, communications system, and maintenance and station equipment; and the integration with other MRT 3-related projects
The terms and conditions of the project are as follow:
• Interest rate: 0.8 percent per annum
• Repayment period: 40 years (including a 10-year grace period)
• Financing terms: Japan-tied
"Reliable transport is not only essential to economic growth, but also for improving the daily lives of ordinary citizens," Kazuya said.
"Through various forms of support, Japan is proud to contribute to the advancement of the Philippine railway system. Japan’s railway experts are, in fact, involved in almost all of the Philippines’ railway projects," he added.
In 2023, Japan and the Philippines signed the second loan agreement for the Phase II of MRT-3's rehabilitation.
The second phase, which loan agreement was signed by Japanese embasssy's Chargé d'Affaires Kenichi Matsuda and former DFA chief Enrique Manalo, focused on Japan's assistance for the continue maintenance of the train line as well as to connect it to the Common Station for passengers' seamless transfer to the LRT-1, MRT-7 and the Metro Manila Subway.
"This second supplemental loan builds on the strong foundation of our existing cooperation with Japan in the rehabilitation of MRT-3. It reflects our shared commitment to ensuring that public transport systems are safe, reliable, and resilient, and that they meet the evolving needs of a modern and dynamic Philippines," Lazaro said.