DoTr in talks for Sumitomo to maintain MRT-3


THE GOVERNMENT is considering Metro Rail Transit (MRT)-3 builder and former maintenance provider Sumitomo Corp. for the maintenance and rehabilitation of the MRT-3 system.

In a statement, the Department of Transportation (DoTr) said  discussions with the Japanese government are ongoing to rehire Sumitomo as the maintenance provider of the MRT, to replace Busan Universal Rail, Inc. (BURI), whose maintenance contract was terminated by the DoTr earlier this month.

The new maintenance and rehabilitation contract will have a term of three years, and will include the rehabilitation and restoration of the system to its “original performance standards.”

“High-level discussions with the Government of Japan are ongoing to pave the way for DoTr’s direct engagement of Sumitomo Corp. and its technical partner Mitsubishi Heavy Industries, under a Government to Government (G2G) Official Development Assistance (ODA) platform,” the DoTr said.

The DoTr said that the joint venture of Sumitomo and Mitsubishi Heavy is being considered due to their previous experience with the MRT.  “The joint venture of Sumitomo Corp. and Mitsubishi Heavy Industries is being closely considered due to their background and experience with the MRT-3 — they designed and built the system from 1998 to 2000, and maintained the system from 2000 to 2012.”

The then Department of Transportation and Communications in 2012 did not renew the maintenance contract of Sumitomo.

The DoTr added that it is evaluating the unsolicited proposal of Light Rail Manila Corp. (LRMC), a P20-billion investment to rehabilitate the train system, as well as the handling of operations for a period of 30 to 32 years. The agency last month granted original proponent status to LRMC, and the proposal will “soon be endorsed” to the National Economic and Development Authority for its evaluation. 

LRMC currently manages the Light Rail Transit (LRT)-1. The consortium is composed of Metro Pacific Investment Corp.’s Metro Pacific Light Rail Corp., Ayala Corp.’s AC Infrastructure Holdings Corp. and Macquarie Infrastructure Holdings (Philippines) Pte. Ltd.

Transportation Secretary Arthur P. Tugade earlier this month said that the MRT-3 will have a new maintenance provider next year.

The DoTr said that the MRT transition team has enough manpower, after directly hiring more than 450 former BURI employees, and paid their salaries “in full and on time,” after what it says are months of “delayed and partial salaries.” — Patrizia Paola C. Marcelo


DTI allows 90 days for ease of doing business IRR approval

 Trade Secretary Ramon M. Lopez -- PHILSTAR

Trade Secretary Ramon M. Lopez -- PHILSTAR

THE Department of Trade and Industry (DTI) said it is fast-tracking the drafting of the implementing rules and regulations (IRR) for the newly signed Ease of Doing Business law and has a 90-day timeline for its approval.

“The future gameplan calls for the immediate organization of the Anti-Red Tape Authority (ARTA). I direct the DTI Competitiveness Bureau, which is the Temporary Secretariat of the ARTA, to ensure that the implementing rules and regulations are approved within 90 working days,” Trade Secretary Ramon M. Lopez said during the 6th Ease of Doing Business Summit (EODB) Wednesday in Pasay City.

President Rodrigo R. Duterte signed on May 28 the Ease of Doing Business law which mandates all government agencies, including local government units, to slash processing time for business permits and official documents.

The law requires that government agencies, including local government units, slash processing time for business permits and other official documents.

The implementation of the law is also part of the government’s push in improving its ranking in the World Bank Ease of Doing Business Ranking wherein the country plunged 14 notches to 113thamong 190 countries surveyed in the 2018 report.

The DTI hopes that the signing of the law will be factored into this year’s rankings.

“I don’t know if the passage of the law will be credited, but it just made the cutoff. But again it will all depend on the reforms being felt,” Mr. Lopez added.

Mr. Lopez said the government has passed a total of 19 reforms across all 10 indicators measured by the report of the World Bank — International Finance Corp.

These reforms resulted in a reduction in the number of procedures, processing time, cost, payments, and documentary requirements. Some have also helped improve access to information, or promoted transparency and improved governance.

“If we expect a better ranking that will come out in 2019 the surveys that are taking place or have taken place in the first half of the year should have been felt already by the respondents,” Mr. Lopez said. — Janina C. Lim


Metro Pacific borrowing P18-billion to fund Calax road

By Darwin Amojelar

MPCala Holdings Inc., a unit of Metro Pacific Tollways Corp., said it expects to raise P18 billion through loans from banks to party finance the construction of the Cavite Laguna Expressway Project. 

“We’re hoping June or July to close P18 billion loans from local banks,” MPTC president and chief executive Rodrigo Franco said over the weekend. 

MPCala earlier tapped Leighton Holdings of Australia to build the Cavite side and local contractor DMCI Consunji Inc. to construct the Laguna side.

Calax, one of the largest public-private partnership projects, involves the financing, design, construction, operation, and maintenance of a four-lane, 47-kilometer closed-system toll expressway connecting Cavitex (Manila–Cavite Expressway) and South Luzon Expressway.

The P34.5-billion expressway will start from Cavitex in Kawit, Cavite and end at the SLEx-Mamplasan Interchange in Biñan, Laguna.

Construction is expected to be completed by 2020, while operations and maintenance are set from 2020 to 2050.

MPCala also submitted an unsolicited proposal to the Department of Public Works and Highways to build the P22.43-billion Cavite-Batangas Expressway. 

MPCala said in May it expected to obtain the original proponent status for the Cavite-Batangas Expressway this month.

“As far as we are concerned, we already completed the required documents that they needed. It’s really up to the DPWH [Department of Public Works and Highways] to review and issue the original proponent status. Our expectation is by this month,’ MPCala Holdings president and chief executive Luigi Bautista told reporters earlier.

“After OPS, we have to submit it to Neda [National Economic and Development Authority] for review. If Neda approves it, there will be negotiations. After negotiations, the only time they will offer to Swiss Challenge,” he said.

CTBex is a 49-kilometer expressway that will connect Cavite and Batangas, with a spur road to Tagaytay City and ultimately terminating in Nasugbu, with another spur road to Tuy, Batangas.

The CTBex project is expected to start construction by the first quarter of 2019 and targeted to be completed by the first half of 2022.

Once completed, the project would cut travel time from Sta. Rosa, Laguna to Nasugbu, Batangas from 2.5 hours to just an hour.

The project will start at Silang East Interchange of Cavite-Laguna Expressway. The alignment will traverse the towns of Silang, Amadeo, Mendez, and Alfonso in Cavite, Tagaytay City and Nasugbu in Batangas.

MPTC is constructing the P27.9-billion Cebu-Cordova Link Expressway project. The 8.25-km bridge project, set to be completed by 2020, will connect Cebu City to Mactan Island via Cordova.

The group is also building the NLEx-SLEx Connector Road, an elevated expressway to connect the northern and southern toll road systems at a cost of P23 billion.


IMF's Lagarde says global economic outlook darkening by the day

 Christine Lagarde, Managing Director of the International Monetary Fund (IMF), attends a news conference after a meeting in the chancellery in Berlin June 11, 2018. — Reuters pic

Christine Lagarde, Managing Director of the International Monetary Fund (IMF), attends a news conference after a meeting in the chancellery in Berlin June 11, 2018. — Reuters pic

BERLIN, June 12 — International Monetary Fund chief Christine Lagarde led an attack by global economic organisations on US President Donald Trump's “America First” trade policy yesterday, warning that clouds over the global economy “are getting darker by the day.”

Trump backed out of a joint communique agreed by Group of Seven leaders in Canada at the weekend that mentioned the need for “free, fair and mutually beneficial trade” and the importance of fighting protectionism.

The US president, who has imposed import tariffs on metals, is furious about the United States' large trade deficit with key allies. “Fair trade is now to be called fool trade if it is not reciprocal,” he tweeted yesterday.

In response, Lagarde unleashed a thinly veiled attack on Trump's trade policy, saying challenges to the way trade is conducted were damaging business confidence, which had soured even since the weekend G7 summit.

The Washington-based IMF is sticking to its forecast for global growth of 3.9 per cent both this year and next, she said, before adding: “But the clouds on the horizon that we have signalled about six months ago are getting darker by the day, and I was going to say by the weekend.”

“The biggest and darkest cloud that we see is the deterioration in confidence that is prompted by (an) attempt to challenge the way in which trade has been conducted, in which relationships have been handled and in which multilateral organisations have been operating,” Lagarde said.

The IMF managing director spoke after a meeting in Berlin with German Chancellor Angela Merkel and the chiefs of the World Trade Organisation (WTO), the World Bank, the Organisation for Economic Cooperation and Development (OECD), the International Labour Organisation and the African Development Bank.

Merkel said on Sunday the EU would implement counter-measures against US tariffs and described Trump's rejection of the G7 communique as “sobering and a bit depressing.”

Investors are fearful of a tit-for-tat trade war, though markets were relatively calm on Monday after an early wobble.

'Stop this escalation'

WTO Director-General Roberto Azevedo told the Berlin news conference: “We must ... stop this escalation of tensions. A tit-for-tat process is not going to be helpful.”

He also criticised the United States' conduct at the WTO.

“The US has been focusing much more on bilateral — unilateral even sometimes — measures, which is not something that is support of the rules-based trading system.

“They have been complaining about the system, they say that they want to improve the system, but we would expect a more constructive approach on their part,” Azevedo said.

Earlier, Germany's economy minister said Berlin saw no immediate solution to the trade row between the United States and other major economies but remained open to talks “among friends,” seeking to head off a full-blown global trade war.

As Europe's biggest exporter to the United States, and with more than one million German jobs at stake, Germany is desperate to avoid an EU trade war with the United States.

“I believe a win-win situation is still possible,” Economy Minister Peter Altmaier, one of Merkel's closest lieutenants, told broadcaster Deutschlandfunk.

“At the moment, however, it seems that no solution is in sight, at least not in the short term.”

Particularly concerning for Germany, a major car exporter to the United States, is Trump's weekend tweet that Washington is looking at tariffs on automobiles.

The European Commission, which coordinates trade policy for the 28-member EU, aims to target €2.8 billion (RM13.1 billion) worth of US imports, including bourbon and jeans, with additional 25 per cent duties from early July.

It already has broad backing from EU member states, but needs to consult with them in the next couple of weeks.

European Commission President Jean-Claude Juncker, while questioning whether the United States was truly an ally, said the bloc did not want to stop talking with Washington.

“We do not want to cut off discussions and further talks will of course need to address the automobile sector,” he said. — Reuters


Airport privatization needed – PPP Center


THE government needs to privatize airports to boost tourism in the Philippines, the Public-Private Partnership (PCC) Center said after the International Air Transport Association (IATA) warned last week about the negative impact of such a move, especially on passengers.

“The Philippines is competing with the rest of Asia in business and tourism. The first thing that investors and tourists will see is the airport, so we really have to make sure that we have world-class airports,” PPP Center Executive Director Ferdinand Pecson told The Manila Times last Thursday.

Asked whether the government was capable of building world-class airports, he replied: “Tell me a government airport that is matching what Singapore, Hong Kong, [and]Malaysia [have]. I don’t want to say it (government) is not capable, but look at the evidence.”

Pecson’s remarks came days after IATA Director General and Chief Executive Officer Alexandre de Juniac said “airlines have not yet experienced an airport privatization that has fully lived up to its promised benefits over the long term.”

“It is important that governments take a long-term view focusing on solutions that will deliver the best economic and social benefits. Selling airport assets for short-term cash injection to the treasury is a mistake,” he added.

The remarks also came more than two weeks after former Bases Conversion and Development Authority (BCDA) Director Max Sangil warned that auctioning off a 25-year concession agreement to operate and maintain Clark International Airport in Pampanga province to the private sector may endanger the work of employees there and result in higher airline fares.

The airport is the first hybrid PPP project under the Duterte administration. The government selects, finances, and builds such projects through public budding, and after they are completed puts their operations and maintenance up for bidding by private companies.

“That is something the BCDA is talking about, and has to take into consideration as it enters into agreement with the private sector,” Pecson said.

The employees “have a very valid concern. They are stakeholders. They cannot just be neglected,” he added.

The PPP center official advised people to look at the overall economic impact of the airport.

“The public has to look at the overall impact, not the individual. There are plus and minuses; you cannot just look at the minus side. There has to be a balance,” Pecson said.