It is the first major government effort in nearly four decades to rebuild the country’s railways, Speaker Jose de Venecia said yesterday.
Philippine National Railways chairwoman Josefa Aquino and general manager Jose Ma. Sarasola signed the memorandum for the PNR while Jiang Xinsheng, president of the China National Technical Import and Export Corp. (CNTIC), and Li Bin, president of the China National Machinery Import and Export Corp (CMC), signed for China’s major state-owned companies.
The agreement covers a major segment of the South Line from Calamba to Legazpi City in Albay, and a completely new line extending further south to Matnog, Sorsogon — blasting a new trail through the low-lying mountains of Bicol.
Earlier this year, the South Korean and Philippine governments signed a similar agreement to rehabilitate the South Line from Manila to Calamba.
"With this historic signing, we are finally undertaking a major project that no Philippine government has done in 35 years. Its benefits will be immediate and tremendous for millions of Filipinos," De Venecia said.
Construction is scheduled to start early next year, kicking off the modernization program first broached by De Venecia when he was elected speaker and whose details were fleshed out in the Railways Modernization Act which the House of Representatives passed on third reading.
De Venecia said construction is "expected on turnkey with long-term finance at minimal interest." The government plans to privatize the system after a few years with the private sector proponents absorbing the debt, he added.
The signing was held at Malacañang and attended by President Arroyo and congressmen whose provinces are traversed by the railway system.
The President and De Venecia witnessed the signing together with Transportation and Communications Secretary Leandro Mendoza and Zhang Ru En, vice president of China General Technology (Group) Holding Ltd., parent company of CNTIC and CMC. Chinese Ambassador Weng Chungqui and economic and commercial counselor Yu Shizhong were also present.