STUDY ON ECONOMIC PARTNERSHIP PROJECTS

IN DEVELOPING COUNTRIES IN FY2012

STUDY ON THE MONORAIL PROJECT IN CENTRAL MANILA

IN THE REPUBLIC OF PHILIPPINES

FINAL REPORT
SUMMARY

February 2013

Prepared for:
The Ministry of Economy, Trade and Industry
Ernst & Young Shin Nihon LLC
Japan External Trade Organization (JETRO)
Prepared by:
Oriental Consultants Co., Ltd.
Nomura Research Institute, Ltd.
Hitachi Ltd.

1.

Background and Necessity of the Project

As the capital of the Philippines, Metro Manila is the political, economic and commercial metropolis of the country.
The population of Metro Manila was 11.85 million of 2010. Moreover, the total population in the City of Taguig
(where this project would be mainly located) was about 0.27 million in 1990, and it has increased to about 0.6 million
in 2010 (2.42 times).

The Bases Conversion and Development Authority (BCDA), a Government Owned and Controlled Corporation
(GOCC), had transformed former military bases located in Metro Manila into an alternative productive civilian use
since its activation in 1992 to date. The biggest two of these are Fort Bonifacio, a 240-hectare world class
residential and business district, and Villamor Airbase, the site of Newport City located right across Ninoy Aquino
International Airport Terminal 3 (NAIA-3), which is emerging as the countrys premiere urban integrated tourism
resort with a strong Information Technology (IT) component and airport related businesses.

The growing demand for efficient mass transport system in the metropolis and the growing traffic congestion
within the mix-use districts of Bonifacio Global City (BGC), Newport City, NAIA-3 and its environs would
necessitate the construction of a fast, efficient and safe public transport that would link up with the existing Metro
Rail Transit (MRT) System servicing Epinafio de los Santos Avenue (EDSA) route, Light Rail Transit (LRT)
System traversing the entire length of Taft Avenue from Baclaran, Paraaque City to Roosevelt in Quezon City,
and the Philippine National Railway (PNR) that cuts across Metro Manila towards the Southern Luzon regions.

A conceptual study for the Proposed Global Cities Mass Transit Project (GCMT Project) has been conducted in the
early part of this year through the assistance of Oriental Consultants Company, Ltd. who recommended for the
conduct of a full blown feasibility study in order for the project to advance to the next stage. Included in the
2011-2016 Public Investment Program (PIP) submitted by BCDA to National Economic and Development
Authority (NEDA) for implementation within the medium term, the proposed project would traverse inside BGC
and other adjoining premier mix-use districts such as McKinley Hills, North Bonifacio and South Bonifacio,
Newport City and NAIA-3 in Pasay City connecting from the MRT-3 in Guadalupe, Makati City.

Based on this situation, the BCDA has requested that the study team submit proposal of feasibility study for
development of a mass transit (Monorail) strategy connecting all Global cities to Ministry of Economy, Trade and
Industry (METI).

The road improvement of the circumferential and the radial main corridors in Metro Manila is proceeding in
accordance with the city spread. However, due to physical right-of-way (ROW) constrains, the three major
destinations within the study area of this project, Makati CBD, BGC, and NAIA, are very scarcely connected by
roads. In fact, only two roads exist between Makati and BGC, McKinley Road and Kalaayan-Buendia flyover,
where heavy traffic congestion occurs on daily basis, and where there is no possibility of further capacity

expansion. Additionally, there is only one road which connects directly BGC and NAIA, Lawton Avenue, and
traffic congestion .

Considering that this area is not yet fully developed, with more than double (2.67 times) to be built in these
Global Cities until 2025, plus an additional 76 million annual trip to/from all the terminals at NAIA by the same
year, the mass transport capacity will be clearly insufficient for supporting further rapid development of these areas.
Therefore, since large-scale urban development is planned, a public mass transportation system that connects these
three destinations will be required for this area.

2.

Concept of the Project

2.1

Objectives

The objective of this study is to describe the monorail system that could link all Global Cities, i.e. BGC, McKinley
Hills, McKinley West, Bonifacio South, and Newport with a mass transit mode, including interconnection to an
existing mass transit mode (MRT-3) and the NAIA Terminal 3, evaluate possible routes, estimate costs, and
propose possible financing schemes and implementation timetables. This project will contribute to improve
environmental conditions and alleviat the traffic condition of Manila Metropolitan Area (see Figure 1).

2.2

System Selection

The system should be chosen in consideration of the conditions of the project such as expected demand, maximal
capacity (around 20,000 pphpd), environmental and social conditions, road diversion impact, road traffic impact,
cost, and alignment constrains (minimal curves and slopes).

BRT
The capacity of a BRT system is comparable to that of a LRT (at-grade) or monorail system if using dedicated
high-occupancy vehicle lanes (HOV). However, the greatest challenge in integrating the BRT system in the study
area is road space. The proposed BRT system for Makati and Taguig should as much as possible run on
exclusive . Several sectional concepts along Ayala Avenue with exclusive lanes could be achieved, and the future
widening of Lawton Avenue includes a ROW of 10 meters for a dedicated HOV. However, not all corridors will
have enough space for exclusive BRT lanes. Therefore, it is considered that for the expected demand for the
corridors in this project, the BRT system is not a suitable solution as it cannot be implemented entirely on HOV,
reducing its capacity considerably, hence, not satisfying with the demand.

Figure 1 Study Location Map

Source: Study Team

LRT
The capacity can reach over 40,000 pphpd, which is higher of the monorail, however, the capability to negotiate
small curves and steep slopes in the revenue line is the main demerits of this system to be employed for the study
area. Moreover, the massive slab-type structure, which is less aesthetically attractive and marginally more
expensive than a monorail structure, is not very welcomed by the stakeholders (users) of the project.

AGT
The AGT and monorail have similar performance for constricted alignments, and that both could have similar
capacity; however the main difference is in the size of the rolling stock. The capacity of one car for monorail is
about 200 passengers, as for an AGT car is 100. Thus, in order to carry the same amount of passengers in one
train, the AGT needs the double amount of cars of the monorail. Since one car for AGT is 9 meters. long, and the
monorail is 15 meters. long, so the total train length will be 20% larger for an AGT, reducing the available space
for depot area. We also have to consider that the stations would be 20% longer and the viaducts would be based
of a deck-slab structyre, which is less aesthetically attractive and marginally more expensive than a monorail
structure.

Table 1 shows the results of the comparison between the three rail systems.

Table 1
Item
Capacity
Route condition
Depot size
Noise
Daylight interference
Novelty merit
Aesthetical
Overall cost
Serviceability
Total Evaluation

Summary of Comparison between Rail Systems

LRT
Under used
Limited
Satisfactory
unsatisfactory
Poor
None
Poor
Satisfactory
Unsuitable

Monorail
Satisfactory
Satisfactory
Satisfactory
Acceptable
Acceptable
Attractive
Acceptable
Similar level
Satisfactory
Suitable

AGT
Satisfactory
Satisfactory
Limited
Acceptable
Poor
Satisfactory
Poor
Satisfactory
Unsuitable

Source: Study Team

The particular characteristics of this project include several curves with small radius and very steep slopes, and
also a limited available space for the depot as the area is prime real estate area in Metro Manila. Thus, the
options of LRT and AGT do not seem to be suitable to the project. Accordingly, the monorail system is
recommended as an optimum system for this project.

3.

Outline of the Project

3.1

Route Alignment

The main objective of the proposed project is to connect a mass transit system to BGC to NAIA Terminal 3, which
will satisfy the demand of workers at the BGC, the Resort World Casino and Hotels complex, and the airport.
After a review of site conditions and interviews with stakeholders concerned, several options were proposed and in
turn discarded due to their potential constraints for implementation. The description of the final and recommended
option is as follows.

The terminal station would be located underground where currently Intercontinental Hotel stands, then a tunnel
under McKinley Rd would directly connect to MRT Alaya station, with the transition from the tunnel to be built
along McKinley Parkway south of the intersection with 5th Avenue.. From McKinley Parkway the alignment
reaches Market-Market, and then crosses 32nd street taking University Parkway, connecting with 38th street and
8th Avenue to continue along 8th Avenue and turns right at 34th street, passing behind St. Lukes Medical Center,
takes 5th Avenue towards McKinley Parkway to pass above the tunnel section and then continue along Lawton
Avenue. The alignment takes the entire Lawton Avenue before the intersection with South Luzon Expressway
(SLEX), taking to the south at the creek right after the intersection with Chino Roces Avenue Extension. This
small creek will lead to the intersection with the East Service road 200 meters south of Sales Bridge, and then will
cross below the Skyway and above the PNR tracks and the SLEX, then entering inside PAF Villamor Base. The
alignment would take the main internal road from east to west until reaching behind the Aerospace Museum, and
finally taking the existing parking lot of NAIA Terminal 3. Then, it is considered to enter inside the premises of
NAIA and use the taxiway in front of DHL hangar as transition to a tunnel that would cross under the runway
13/31 and exit within the current Nayong Filipino, then take MIA Road up to the parking lot of Terminal 2, then
using the service road between T1 and T2, reach the parking lot of Terminal 1. Finally, the alignment would take
Ninoy Aquino Avenue toward south until reaching the bridge where the alignment would connect with the future
LRT Line 1 Ninoy Aquino station to be built for the Line 1 Cavite Extension Project. Although this new
alignment will be parallel to the NAIA-Skyway extension and both projects will not be affected, close coordination
between the two projects detail designs will be required. The recommended alignment (Option 5) is shown in
Figure 1.

Pending Issues for recommended alignment

Although this option is the most suitable one, it still has some pending issues that have to be addressed during
detailed design stage and prior to project implementation as described below.

One is the ROW between Pasong Tamo and the crossing of Skyway. There are several houses that will
be affected and ROW acquisition is unavoidable. This matter is explained in detail in Chapter 4.

Another ROW issue is the sharp curve at 34th street corner 5th Avenue where St. Lukes Hospital and
S&R Shopping are located. The alignment is fixed as far as possible from the hospital, but it gets very
close to the supermarket. Probably additional ROW would be needed.

The crossing of the Philippine Air Force (PAF) Villamor Base is another matter that was not addressed
during the implementation of this Study, but sooner or later this issue should be discussed at higher levels
of the Government.

3.2

Location of Stations

The station for the GCMT Project should be aesthetically attractive, functional, able to cope with future demand,
safe, and provide good connectivity to existing structures. The proposed stations for the project are the indicated
in Table 2:

Table 2
Station

Km post

Ayala

0k+000

Memorial

2k+735

3
4
5
6
7

Market-Market
Schools
Uptown
St. Luke's
23rd Street

3k+600
4k+255
5k+287
6k+200
7k+080

McKinley Hills

8k+228

9
10
11
12
13
14

Bayani Rd.
ASCOM*
Pasong Tamo
NAIA T3
NAIA T2
NAIA T1

8k+970
9k+820
10k+688
13k+124
16k+784
17k+712

15

Ninoy Aquino

19k+178

List of Stations

Location
Intersection of Ayala Avenue-EDSA. Underground station at current
location of Intercontinental Hotel.
Along McKinley Parkway close to 8th Avenue, beside American
Memorial Cemetery
Between Market-Market and Serendra
Along University Drive in front of football field of ISM
At 8th Avenue corner 38th street
5th Avenue corner 32nd street, in front of McDonalds
Along 5th Avenue, in front of Singapore Embassy
Along Lawton Avenue, just north of future rotunda at the entrance of
McKinley Hills and McKinley West
Along Lawton Avenue. in front of current NAMRIA
Along Lawton Avenue. in front of current ASCOM football field
Along Lawton Avenue. Just east of Pasong Tamo ext.
In front of T3, mezzanine at same level as departure hall
At parking lot in front of T2
At parking lot in front of T1
Along Ninoy Aquino Avenue. connecting with future LRT Line 1
station of Cavite Extension.

*:Name and location to be revised based on future development

Source: Study Team

3.3

Depot

The depot is always a very challenging item in any planning of a railway project as it occupies a considerable large
area. This is particularly critical in the GCMT project as the alignment crosses prime real estate areas, and
consequently, a large space exclusivery used to a depot, and close to the alignment, is difficult to find. However,
BCDA has identified a site at the Consular Road that could be utilized as it has enough available area (10 hectares)
and has easy access. Currently, 3.5 ha have been reserved for as a site for the proposed depot (please refer to
Figure 2) but the Study Team considers that a minimum of 5.5 ha is necessary for this project. For comparison
purpose, the proposed layout of the depot is shown in Figure 3 at the same scale of Figure 2. The required area is
around 5.5 ha. Figure 4 shows a computer generated 3D model of the depot area and the vicinity of McKinley
Hill Station.

Figure 2 Current Master Plan for Consular Area

Source: BCDA

Figure 3 Proposed Depot Layout at Consular Area

Source: Study Team

Figure 4 CG 3D image of Proposed Depot at Consular Area

Source: Study Team

3.4

Passenger Demand Forecast

A comprehensive passenger demand forecast was carried out during this study. The results are summarized in the
following table showing different fare structures.

Table 3
Fare:
year
2017
2018
2019
2020
2021
2022
2023
2024
2025
2026
2027
2028
2029
2030
2031
2032
2033
2034
2035
2036
2037
2038
2039
2040

Daily

CaseA20+2.5/km
Pphpd
Trip
Fare

Revenue

Daily

Ridership and Revenue

pax

pax

km

Pesos

Pesos/day

pax

185,996
290,657
292,955
295,254
297,552
299,850
405,934
409,022
412,110
415,197
418,285
488,737
492,318
495,900
499,481
503,063
506,644
510,226
571,540
571,540
571,540
571,540
571,540
571,540

11,161
12,489
12,588
12,687
12,785
12,884
16,306
16,430
16,554
16,678
16,802
17,995
18,127
18,259
18,390
18,522
18,654
18,786
19,684

4.87
4.86
4.90
4.94
4.98
5.01
5.36
5.40
5.44
5.48
5.52
6.25
6.30
6.34
6.39
6.43
6.48
6.52
7.14
7.14
7.14
7.14
7.14
7.14

32.18
32.15
32.25
32.35
32.45
32.53
33.40
33.50
33.60
33.70
33.80
35.63
35.75
35.85
35.98
36.08
36.20
36.30
37.85
37.85
37.85
37.85
37.85
37.85

5,984,421
9,344,623
9,447,799
9,551,467
9,655,562
9,752,621
13,558,196
13,702,237
13,846,896
13,992,139
14,138,033
17,411,256
17,600,369
17,778,015
17,968,829
18,147,998
18,340,513
18,521,204
21,632,789
21,632,789
21,632,789
21,632,789
21,632,789
21,632,789

187,990
290,657
292,955
295,254
297,552
299,850
416,717
419,887
423,057
426,227
429,396
536,094
540,022
543,951
547,879
551,808
555,736
559,665
655,471
655,471
655,471
655,471
655,471
655,471

CaseB15+1.25/km
Pphpd
Trip
Fare
pax

11,341
12,489
12,588
12,687
12,785
12,884
16,394
16,519
16,644
16,769
16,893
19,412
19,554
19,696
19,838
19,981
20,123
20,265

Revenue

Daily

CaseC12+1.00/km
Pphpd
Trip
Fare

Revenue

km

Pesos

Pesos/day

pax

pax

km

Pesos

Pesos/day

4.85
4.86
4.90
4.94
4.98
5.01
5.33
5.37
5.41
5.45
5.49
6.39
6.44
6.48
6.53
6.58
6.62
6.67
7.45
7.45
7.45
7.45
7.45
7.45

21.06
21.08
21.13
21.18
21.23
21.26
21.66
21.71
21.76
21.81
21.86
22.99
23.05
23.10
23.16
23.23
23.28
23.34
24.31
24.31
24.31
24.31
24.31
24.31

3,959,539
6,125,596
6,188,674
6,252,003
6,315,541
6,375,561
9,027,132
9,116,796
9,206,778
9,297,076
9,387,670
12,323,461
12,447,507
12,565,268
12,690,247
12,815,741
12,934,755
13,061,182
15,936,139
15,936,139
15,936,139
15,936,139
15,936,139
15,936,139

190,080
292,890
295,206
297,522
299,838
302,154
418,480
421,663
424,847
428,030
431,213
561,748
565,864
569,980
574,097
578,213
582,330
586,446
705,015
705,015
705,015
705,015
705,015
705,015

11,528
12,631
12,730
12,830
12,930
13,030
16,489
16,614
16,740
16,865
16,991
19,678
19,822
19,967
20,111
20,255
20,399
20,543

4.87
4.89
4.93
4.97
5.01
5.04
5.33
5.37
5.41
5.45
5.49
6.37
6.42
6.46
6.51
6.56
6.60
6.65
7.41
7.41
7.41
7.41
7.41
7.41

16.87
16.89
16.93
16.97
17.01
17.04
17.33
17.37
17.41
17.45
17.49
18.37
18.42
18.46
18.51
18.56
18.60
18.65
19.41
19.41
19.41
19.41
19.41
19.41

3,206,650
4,946,912
4,997,838
5,048,948
5,100,244
5,148,704
7,252,258
7,324,286
7,396,586
7,469,124
7,541,915
10,319,311
10,423,215
10,521,831
10,626,535
10,731,633
10,831,338
10,937,218
13,684,341
13,684,341
13,684,341
13,684,341
13,684,341
13,684,341

Source: Study Team

3.5

Summary Outline of the Project

The project outline is summarized in Table 4.

Table 4

Summary Outline

Item

Value

Route Length
Track lenght
Number of Stations
Passengers per Day
PPHPD
Headway
Train Composition
Rolling Stock Required
Location of Depot and Workshop

19.18 km
20 km
15
185,996 (2017); 405,934 (2023)
21,333 (max, 2035)
2.25 min
4 cars
44 trains (2035)
Consular Area, 5.5ha

Source: Study Team

3.6

Estimated Costs of the Project

The total project cost is shown in Table 5. The cost is shown considering phasing of the project, but it is not
considering future additional disbursement for the purchase of rolling stock when reaching maximal capacity in
2035. The cost for Phase 1 is 31,373 million pesos, and the total project cost is around 55.8 billion pesos, of
which almost 70% is foreign component (rolling stock, depot equipment, E&M and tunneling, mainly).

3.7

Financial and Economical Evaluation

The Financial Internal Rate of Return (FIRR) was estimated considering the total project cost, Operation and
Maintenance cost (refer to Table 6), revenue due to ridership and other non-revenue income (ref. Table 4). The
results are shown in Table 7.

3.7.1

Financial Analysis

The main purpose of financial analysis is to examine the financial viability of the implementation of the project
from view point of project implementation body. Three different fare structure cases were studied, case A: P20 +
2.5P/km; Case B: P15 + 1.25P/km; and Case C: P12 + 1.00P/km

Finance Plan
The financial plan in case of the work sharing method will be discussed below. It is assumed that necessary funds
of this project will be provided by the yen loan.

Table 5

Total Project Cost

Cost(Myen)

Cost Items

Phase 1
1

Rolling Stock (Monorail)

Cost Component (Million)

Unit
Phase 2

Phase 3

Total

percentage

Local (Pesos)

percentage

Foreign (yen)

train

15,960

8,400

9,240

33,600.0

0%

0.0

100%

33,600.0

Signal, CTC, Telecom Double

km

2,860

1,960

1,680

6,500.0

20%

687.8

80%

5,200.0

Signal, CTC, Telecom Single

km

1,344

1,024

2,368.0

20%

250.6

80%

1,894.4

Track Switch (Turnout)

set

1,120

480

1,600.0

20%

169.3

80%

1,280.0
1,536.0

Track Switch (Hanoji)

set

640

640

640

1,920.0

20%

203.2

80%

Traction Sub- Station

set

960

480

480

1,920.0

10%

101.6

90%

1,728.0

Power Line double

km

2,503

1,715

1,470

5,687.5

15%

451.4

85%

4,834.4

Power Line single

km

840

640

1,480.0

15%

117.5

85%

1,258.0

Spare Parts

LS

1,311

684

759

2,754

15%

218.6

85%

2,340.7

Test & Commission

LS

1,200

1,152

1,152

3,504.0

10%

185.4

90%

3,153.6

Civil

10

11

Viaduct

Double Track

km

4,576

3,136

2,688

10,400.0

90%

4,952.4

10%

1,040.0

Tunnel

Single Track

km

7,498

5,713

13,211.1

20%

1,398.0

80%

10,568.9

Double Track (Elev)

set

2,100

1,200

900

4,200.0

90%

2,000.0

10%

420.0

Double Track (Under)

set

2,579

2,579.0

70%

955.2

30%

773.7

Station

Depot
Buildings & Facilities

ha

1,760

1,760.0

95%

884.7

5%

88.0

Depot Equipment

Ls

2,100

2,100.0

5%

55.6

95%

1,995.0

Track works

Ls

3,740

3,740.0

70%

1,385.2

30%

1,122.0

Civil Works

ha

6,204

6,204.0

90%

2,954.3

10%

Total Investment Cost :

59,295

19,847

26,386

105,527.3

Total Project Cost

59,295

19,847

26,386

105,527.3

16,970.52
30.39%

69.61%

Source: Study Team

Table 6

Operation and Maintenance Cost

Unit: Million Pesos

Phase

2017
878.50

2018
1,386.28

2023
2,223.60

Source: Study Team

2028
3,250.46

2035
3,515.26

620.4
73,453.04

Cash Flow Analysis

The results of the financial analysis are summarized in Table 7. Judging from this analysis only Case a is
financially viable.
Table 7

FIRR for the Project

Case

FIRR

Case A

2.9%

Case B

-1.8%

Case C

-4.6%

Source: Study Team

3.7.2

Economic Analysis

The main purpose of economical analysis is to show the effects of the implementation of the GCMT Project from
viewpoint of national and regional economy.

Effect of Introduction of the Project

Effect of introduction of the Project consist of a) direct effect, b) indirect effect. Among these effects, the
following tangible benefits are calculated:

Saving in vehicle operation cost (VOC)

Saving in vehicle operation time (VOT)

Saving in travel time

Cost Benefit Analysis

Based on the estimated economic benefits and costs, the cost benefit analysis is made and is shown in Table 8.

The result of EIRR shows that all cases have more than 15%, the social discounting rate. Therefore, it is
considered that all cases are feasible from national economic viewpoints.

Table 8

Result of Cost Benefits Analysis

Case A

EIRR
B/C
NPV (Mill. PhP)

15.2%
1.16
487.2

Case B
15.5%
1.19
1,260

Case C
15.8%
1.21
1,994

Source: Study Team

3.8

Environmental and Social Impact

3.8.1

Present Condition of the Project Area

In the Republic of Philippines, as well as in Metro Manila, the transportation system and transport infrastructure
are in poor condition and posing critical problems such as congestion, accidents and environmental pollution. The

problems of traffic congestion brought by population growth, urbanization and motorization are rapidly becoming
major social issues. In the Project area, air pollution as well water quality and noise level are higher than the
environmental standards in several locations.

3.8.2

Environmental Impacts of the Project

By proposed Monorail project, motor vehicle travelling is expected to decrease and air pollutant from vehicle will
be decreased. Carbon dioxide (CO2) emission from vehicle will also be decreased, but it was estimated that CO2
emission by monorail operation will exceeded this reduction effect. The environmental items that are necessary to
survey the influence of the impact in more detail prior to the implementation of the project are as follows.

Impact of Noise along the Monorail Alignment

Impact on Hydrology

Impact on Ecosystems and Biota

Impact on Current Transport Systems

Impacts during Construction (Traffic Congestion, Noise, Water, Waste)

There is a possibility that the AFPOVAI Village in Taguig City located in the north side of Metro Manila Skyway
(MMSW) will be affected by the construction of the elevated guideway between Pasong Tamo station and MMSW
with about 400m. In order to minimize the environmental and social impact problems, alternative routes were
proposed as follows.

Case-1: Base Case: Monorail alignment will pass G. Julliano Avenue and R Crame Avenue.
Case-2: Monorail alignment will pass in Maricaban Creek

Based on review of comparison of these alternative plans, Case-2 plan which will pass into the existing Maricaban
Creek towards NAIA terminal 3 is more attractive. Detail survey for resettlement and acquisition should be
conducted in detail design stage, and based on this survey, resettlement plan should be prepared. This proposed
Monorail project will be categorized as ECP (Environmentally Critical Project). Therefore, EIA report called
Environmental Impact Statement (EIS) shall be prepared during the next Feasibility Study (FS) Stage which will
decide the project design in detail.

3.9

Recommendation

Despite lower financial return, it is recommended to further study the feasibility of Case A (P20 + 2.5P/km) in a
full blown study.

4.

Project Implementation Schedule

The implementation of the GCMT Project is not completely independent of the implementation of other projects,
not only in terms of possible demand if some developments are not done, but also physical, such as the renovation
of the Ayala center area where currently the Intercontinental Hotel is located, and also the widening of Lawton
Avenue. Thus, the Project Implementation schedule for the GCMT Project is estimated taking into account the
abovementioned projects, and divided into the following phases:

1)

Phase 1: The Phase 1 is taken as to McKinley Hill Station via BGC from Ayala Station.
Furthermore, divide into 2 sub-sections:
a)

Phase 1-a: From BGC to McKinley Hill Station

b)

Phase 1-b: From Ayala Station to BGC

2)

Phase 2: From McKinley Hill Station to NAIA terminal 3 station

3)

Phase 3: From NAIA Terminal 3 station to Ninoy Aquino station (LRT 1)

Figure 5 shows the Implementation Schedule of this project, assuming a funding scheme based on JICA STEP
Loan.

Figure 5 Project Implementation Schedule

2013

Activity
1

Phase

2014
4

2015
4

2016
4

1a

2017
4

2018
4

2019
4

2020
4

1b

2021
4

2022
4

JICA Study
Environmental and Social Consideration
EIA Study and preparation of
document (EIS/EPRPM)
Evaluation of EIS
report/Issue of ECC
Validation of Affected
Person and Structures
Negotiation for
Resettlement Site
NEDA Approval
JICA Appraisal
Loan Agreement
Selection Consultants
Engineering/ Tender Assistance
ROW Acquisition
Selection Contractor
Construction
Civil Works
Viaduct
Tunnel
Stations
E&M Works
Rolling Stock
Commissioning
Liability Period
Revenue Operation

Source: Study Team

2023
4

2024
4

2025
4

2026
4

2027

2028
4

5.

Feasibility of the Project and Possibility of Yen Loan Requests

5.1

Position of the Executing Agency for Financing the Project

As a Government Owned and Controlled Corporation of the Philippine government, BCDA has in theory the
following financing mechanisms for this project.

1)

Budget allocation from the National Government under General Appropriation Act

2)

Retained earnings

3)

Equity paid-in by the National Government

4)

Concessional loan from Bilateral and Multilateral Developing Banks

5)

Loan from Export Credit Agencies

6)

Loan from commercial banks

7)

Issuance of bond

Judging from legal requirements, interest rate, tenure and so forth, 4) Concessional loan from Bilateral and
Multilateral Developing Banks is the most feasible among debt finance, followed by 5) Loan from Export Credit
Agencies. 2) Retained earnings can serve as a local counterpart fund in case of 4) Concessional loan from Bilateral
and Multilateral Developing Banks.

5.2

Funding by Other Financing Agencies

Essentially, there have been no bilateral or multilateral development banks other than JICA (including former JBIC
then) which have loaned rail transport infrastructure projects in the Philippines over the past few decades.

Among multilateral development banks, the World Bank (IBRD) and the ADB (Southeast Asian Region
Department), both of which chiefly loan the public sector, have little precedence in financing transport projects in
the Philippines over the past few decades, and have little future projects in the transport sector in pipeline.
Henceforth, chance seems to be slim that either of them becomes a lead financier for this project.

Chinese and Korean export-import banks remain active in other sectors, but would have little, if not none, interest
in financing this project, as Chinese and Korean companies are not necessarily competent in Monorail technology
and products.

5.3

Expected Financing Scenarios and Status/Possibility of the Japanese Yen Credit Application

The most feasible financing mechanism for this project is the concessional ODA loan from bilateral and
multilateral development banks, in consideration of sizeable project cost, length of amortization period, and low
financial return unsuitable to commercial debt finance. Among bilateral and multilateral development banks, JICA
seems to be the most promising, as it has several precedence in loaning rail transport projects in the Philippines,

and can extend concessional Yen loan for long-term of 30 to 40 years. In fact, BCDA also find it most concessional
and hence promising.

This project, as an urban public transport, is eligible to enjoy terms and conditions of Special Terms for Economic
Partnerships (STEP) of Yen loan. Under STEP, the procurement is tied to Japanese contractors and suppliers to a
certain extent, and the interest rate becomes further concessional. Hence, from the viewpoint of BCDA, choice is
either to enjoy the most concessional interest rate with Japan-tied procurement or to go for the usual concessional
interest rate with untied procurement.

5.4

Status of the Arrangements for Japanese Yen Credit

BCDA plans to start construction of this project at earliest possible timing during the current Aquino
administration (until 2016), and to start commercial operation even in part from late 2010s. BCDA has requested
NEDA to include this project in the Public Investment Plan (2011-2016) which is still draft. The current working
draft of PIP (2011-2016) lists this project as one of priority projects.

5.5

Actions Required towards the Application to Japanese Yen Credit

Moving forward, necessary actions towards the application to Japanese Yen Loan are listed herein under, 1) and 2)
among which are the most important ones as a preparatory procedure for realizing this project.

1) Feasibility Study

Implementation Program in detail

Environmental Impact Assessment in detail

2) Project Approval

Environmental Compliance Certificate (ECC)

Project Approval by the BCDA board

Project Approval by NEDA Investment Coordination Committee (ICC)

3) Application to Japanese Yen Loan

5.6

Administrative procedure among the Philippine government agencies

Administrative procedure from the Philippine government to the Japanese government

Action Plans and Issues to be Resolved upon the Request for Japanese Yen Credit

The very next step for BCDA is to conduct a comprehensive feasibility study, which shall be prerequisite in
securing the ECC from DENR and the project approval from NEDA-ICC. Based upon the result of this
pre-feasibility study, BCDA will need to discuss the conduct and fundraising of feasibility study with JICA and
other concerned agencies.

6.

International Competitiveness of Japanese Company & Japanese

Components

The competitiveness of Japanese companies in the field of railway technology is well known worldwide as a high
performance, safe and reliable mass transit system. For example, rolling stock, station and depot facilities,
signaling, telecommunication, and train control systems, as well as appropriate construction methods in congested
urban area and so on. In case of monorail technology, Japan has almost 50 years of experience since when Tokyo
Monorail was opened for the Olympic Games in 1964. Japanese railway companies have also high quality
operation and maintenance capabilities and an excellent program for technology transfer for the recipient countrys
staff. Thus, it is understood that Japanese companies have a good chance to get engaged in this project.

Regarding construction plan of the GCMT Project, import of related railway technologies was studied. The
expected items to be procured from Japan are, but not limited to, monorail rolling stock and associated E&M
systems, depot equipment, and tunneling (TBM) technology.

Japanese companies are well known for excellent quality of their products, especially reliability and cost
performance, including Monorail System. Nevertheless, the following matters should be considered in order to
promote the participation of Japanese companies in this project:

Operation and Maintenance

Minimum impact on existing traffic

Consideration for Social and Natural Environmental issue

Single Package

7.

Possible Risks against Realization of the Project

Potential risks against realization of this project can be considered as listed herein under. BCDA shall need to
explain to and discuss with stakeholders concerned including those with vested interests.

Objection by residents and entities locating alongside or near Monorail alignment

Objection by users and operators of buses and jeepneys to be affected

Closure or curtailed usage of NAIA and relocation of airport functions to other places