Earning Our Tomorrow
By Philip Ella Juico
Observers of the transport sector have repeatedly opined that “we are aware of the issues hounding the sector.” They add that practitioners and scholars have identified the challenges that confront the transport sector and are therefore not too interested in another discussion of these same issues. They are, however, interested in specifics. They claim there is no shortage of opinions on the issues but there is a shortage of facts.
A common issue that is agreed on and repeatedly raised by international experts and lending and grant-giving agencies is the weak governance within the agencies responsible for policy-making and program implementation. To be fair, however, there is no lack of serious and honest attempts to improve and strengthen the governance system. The traditional areas of improvement are in institutional strengthening and capability building but such statements are admittedly still generalizations, according to the same observers.
In response to these comments, stakeholders have provided an assessment of the governance team over the past six years. The conclusion is that there was a “lack of attention” paid to project development — particularly in the preparation of feasibility studies which resulted in Right-of-Way (ROW) issues for the Philippine National Railways (PNR) South Rail Laguna to Matnog Segment and for Mindanao Rail.
Because of the lack of detailed feasibility studies, there is very little basis—and even a disincentive — for private sector investment, which is one of the challenges of the transport sector. A big private sector–led investment — San Miguel Corp.’s economic zone and freeport, which passed rigorous scrutiny — is now encountering rough waters that could have serious implications on the appetite of the private sector for investing in this critical sector. It is hoped that the issue is resolved posthaste as prolonged uncertainty serves to discourage serious investors.
Private sector investment should, because of the stakes involved, bring to bear the best of project management skills on any massive infrastructure investment.
The development of the PNR or the lack of it, is one of the results of the lack of project management manpower. As stated in my column last week, my interest in the PNR dates back to my childhood days when, as a Boy Scout, we would ride the PNR (previously known as the Manila Railroad or MRR) from Tutuban station in Manila to Damortis, La Union. In addition, stories narrated by our elders about the rail system in the early 1900s as being the backbone of the transport of commodities and commuters in Luzon that was linked to the Tranvia System through the county’s first multi-modal system and terminal at Tutuban served to reignite our interest in the PNR.
The PNR link at that time stretched from Tutuban to Damortis in the north; Santiago, Isabela, in the northeast; Batangas City in the southwest; and Legazpi, Albay, in the south.
That line went all the way to Bicol and gave birth to the term “Biyaheng Bicol” to connote a fast, non-stop trip similar to a fast break in basketball or an end run in American football. The latter connotes getting past obstacles by going around them or the train going around or avoiding crowded city streets. Unfortunately, by the 1980s, the PNR was reduced to operating only between Tutuban and Calamba, Laguna.
The promise in 2016 to create a rail system between Clark in Pampanga to Legazpi, a Mindanao Rail that has a Northern Mindanao Line, an Agusan del Norte to Davao Line, and a Southern Mindanao Line has remained unfulfilled.
There are lingering doubts about the ability of the PNR project team within the governance structure to respond to the requirements of project development, project financial closure, and project management essential to implement the two massive rail development plans.
Specifically, observers state that the project rollout team landed on the shoulders of two senior PNR executives and a junior Undersecretary, needing further augmentation if we desire to speed up the process of project approvals for the finalization of project Terms of Reference to the issuance of Notices of Award and Notices to Proceed.
Other issues have plagued PNR aside from project development and management. We are told that the development of the proposed a multi-billion Tutuban Intermodal Terminal under a Public-Private Partnership (PPP) model as proposed by Tutuban Properties, Inc. (TPI), a subsidiary of Ayala Land, Inc., remains on the back burner due to a “surprise” lease involving a large percentage of the concession area granted to TPI.
The development of the Mindanao Rail has been delayed by disputes over jurisdiction and the lack of expertise needed to prepare a detailed feasibility study. The latter would be the basis of detailed engineering design which will in turn be the basis of surveys. All these are needed for the approval of project cost. The absence of these documents at this very late stage prompts people to ask what then was the basis for the announcement that Mindanao Rail from Tagum to Davao will be operational by 2022?
Other matters that need attention and further highlight the need for planning and project management expertise at the Department of Transportation (DoTr) especially in the light of food scarcity and supply chain challenges include activating the Food Terminal complex at PNR Caloocan which is linked to the NLEX Connector Tollway. This will provide a distribution point for agricultural products for Metro Manila. The development of a food terminal facility is under the mandate of the PNR. Again, the trigger is the preparation of the complete feasibility study, following a detailed engineering design and securing budget approval.
There are many more projects in the pipeline in the portfolio of the PNR. Over the years, names and faces have changed at the PNR and DoTr but the main issues have practically remained the same aside from lack of private investment capability and capacity building of both the DoTr and PNR. In the cases we pointed out, observers say, capability and capacity building and institutional strengthening should be directed at project planning, development and management. It must be emphasized that bad or unrealistic plans (due to lack of inaccurate data), result in faulty design and execution and eventually an unresponsive and even unsafe product or infrastructure.
Philip Ella Juico’s areas of interest include the protection and promotion of democracy, free markets, sustainable development, social responsibility and sports as a tool for social development. He obtained his doctorate in business at De La Salle University. Dr. Juico served as secretary of Agrarian Reform during the Corazon C. Aquino administration.