Gov’t identifies funds for MRT 3 takeover

MANILA, Philippines - The Aquino administration has identified the source of funds for the proposed $1-billion complete government takeover of the operations of the Metro Rail Transit line 3 (MRT3) along EDSA within the year.

National Treasurer Rosalia de Leon told reporters on the sidelines of the annual seminar of the Economic Journalists Association of the Philippines (EJAP) that the government could well afford to acquire the stake of private shareholders in the operator of the MRT3.

“Money is not a problem. We (National Government) also have ways and means (to buy the bonds). We have identified some portions of the national budget (that can be used to buy the bonds),” De Leon added.

Last December, Malacañang gave the Department of Transportation and Communications (DOTC) the green light to pursue the complete government takeover to save on equity rental payments, maintenance cost, debt guaranteed payment, insurance expenses, and others being paid by the agency.

The move would also help state-owned government financial institutions (GFIs) particularly Land Bank of the Philippines and Development Bank of the Philippines to unload their interest in MRT3 after receiving several warnings from the Bangko Sentral ng Pilipinas (BSP) regarding its investments in the mass transport system.

President Aquino has issued Executive Order 126 directing the DOTC and the Department of Finance (DOF) to buy out MRT3 from the Metro Rail Transit Corp. (MRTC) pursuant to a build-lease-transfer (BLT) agreement.

In 2003, the MRT line’s private concessionaire MRTC then owned by the Sobrepena family’s Fil-Estate Corp, decided to cash in on its investment in the train line by issuing asset-backed bonds for future equity rental payments.