Contract between NorthRail, Chinese group to push through

MANILA, Philippines - The contract between the North Luzon Railways Corp. (NorthRail) and Chinese contractor Sinomach for the rehabilitation of Northrail will proceed after the Department of Transportation and Communications cleared it from allegations of anomalies in its execution.

DOTC Undersecretary Glicerio Sicat said that they are about to finish reviewing the contract and that they have not found anything wrong with it. “There won’t be a cancellation,” he said.

Sinomach, formerly China National Machinery and Equipment Corp., was awarded a contract to rehabilitate the NorthRail, a project funded by a loan from the Chinese Export-Import Bank.

The two phases of the NorthRail project are being reviewed by the agency due to allegations of over pricing.  It also took note of the project’s slow progress.

The NorthRail project Section1, a 42-kilometer train line which runs from Caloocan City to Malolos, Bulacan, has been under construction since 2008. So far, the project is only 20-percent complete. The project has been undergoing review since July last year.

The completion date of phase 1 has been moved to 2013.

The NorthRail project Section 2, which runs from Malolos, Bulacan, to Clark, Pampanga, is also being reviewed to clarify and improve contract conditions and to expedite project implementation.

Transportation Secretary Jose de Jesus said the NorthRail project is just one of the many projects being reviewed by his agency to make sure that there are no anomalies.

NorthRail is reducing its manpower by almost half on April 29.

De Jesus said employees of NorthRail will be trimmed by 76 “due to over staffing.”

“NorthRail will reduce manpower by almost half, from 168 to 92,” de Jesus, as he pointed out that those who were laid off served non-technical positions.

“The review is nearly complete and we are now in discussions with the contractor,” he added. 

Last December, the DOTC cleared 111 contracts entered into by the agency, its sectoral offices and attached agencies with the private sector. However, 19 were put on hold. These projects were approved in the few remaining months of the Arroyo administration.

According to de Jesus, the review was meant to ensure that these contracts are above board and was also necessary to remove the potential obstacles that might get in the way of the full implementation of these projects.