SEVERAL Japanese companies are interested in participating in the auction for the operations and maintenance (O&M) of the Metro Rail Transit Line 3 (MRT-3), according to the Japan International Cooperation Agency (JICA).
“There are many Japanese private companies that are interested to join the bid,” JICA Chief Representative in the Philippines Takema Sakamoto told BusinessWorld last week. “But they have some sort of concerns — business risks — because of the very low ticketing price.”
The Department of Transportation (DoTr) targets to auction the operations and maintenance contract for MRT-3 by the first quarter of next year.
Last month, the agency said it was still trying to determine the scope of the contract. It is now working with the Asian Development Bank to develop a public–private partnership for the MRT-3 project.
JICA is willing to help the Transportation department create a better environment for the bidding, Mr. Sakamoto said.
“We are proposing to consider the possibility of providing the budget support to DoTr so they can prepare enough budget or resources for the availability payment for MRT-3,” he said.
“In such a case, there might be a very competitive environment for getting more competitive bids, which is a win-win case,” he added.
Availability payments refer to predetermined payments by the agency to the project proponent in exchange for the delivery of an asset or service under the contract.
The DoTr aims to privatize MRT-3 before the contract expires next year under the build, lease and transfer agreement with MRT-3 operator Metro Rail Transit Corp.
While the government had announced its intentions of going the solicited route for the operations and maintenance of the MRT-3, there are two unsolicited proposals for it.
Last month, the DoTr said it was evaluating the unsolicited proposal made by the Metro Pacific Investments Corp. to integrate the operations of MRT-3 and the LRT-1.
Aside from the group, San Miguel Corp., which was declared the original proponent for the MRT-3’s operations and maintenance contract in 2022, has also submitted a proposal. — Ashley Erika O. Jose
