An assessment study on the present operational status of the LRTA line 1

(Monumento to Baclaran) for the increasing volume of commuters

as an ease of accessibility to the transportation
Chapter 1

The Problem and its Background

Background of the Study

The population of the Manila metropolitan area of the Republic of the Philippines, which

was 7.95 million in 1990, rapidly increased 1.45-fold to 11.5 million by 2007. Urbanization is

increasingly worsening traffic conditions. Nationwide, the total number of registered

automobiles has increased at a rate of approximately 6% annually and exceeded 5.9 million in

2020. These circumstances accentuate the need to reduce air pollution, curtail greenhouse

gases and improve mass transportation.

Urban railways available in the Manila metropolitan area are Light Rail Transit (LRT)

Lines 1 and 2 operated by the Light Rail Transit Authority (LRTA) MRT Line 3 operated by the

Department of Transportation and Communications (DOTC), and commuter trains operated by

Philippine National Railways (PNR). In their current state these systems are unable to cope with

demand and further upgrading and expansion is ought.

The Government of the Philippines plans to expand the mass transit system in the Manila

metropolitan area to solve the increasingly serious transportation problem. The LRT Line 1

extension project (“the Project”) is a top priority project under DOTC’s Manila Metropolitan

Area Transportation Master Plan and cited in the Comprehensive Integrated Infrastructure

Program (CIIP) of the National Economic Development Authority (NEDA).

 The Project is supported by Japan’s Individual National Assistance Program for the

Philippines, which promotes “Sustainable economic growth to create employment opportunities”

and also JICA’s development goal, “Constructing a Foundation for Economic Growth,” which

prioritizes “Transportation Network Improvement Program”. JICA efforts include the “LRT

Line 1 Enhancement Program,” and the “Metro Manila Metropolitan Traffic Congestion

Alleviation Project,” to facilitate development of railway transportation and build sustainable

transportation systems. These programs are viewed as high-priority assistance areas. In addition,

the Ministry of Economy, Trade and Industry (METI) conducted a “Study on Manila LRT Line-

2 East-West Extension Project in Philippines” (hereinafter “the METI Study”) and proposes a

specific extension section.

Based on these plans, the Philippine Government has requested that the Japanese

Government conduct a feasibility study for the LRT Line 1 extension project, which is aimed at

resolving serious traffic congestion in the Manila metropolitan area, reducing air pollution and

greenhouse gases, and contributing to alleviating climate change.

The need of the Public sector to engage the Private sector in a partnership for funding of

public infrastructure or development project is to relief public debt burden. The most common

manner to attract private investor in these ventures is first by allowing them to collect revenue or

fees; and secondly, by closing the viability gap and/or with a proper allocation of risks, making

what would be a non-commercially viable project viable. Therefore, it has been declared a policy

of the GOP to recognize the indispensable role of the private sector as the main engine for

national growth and development and provide the most appropriate incentives to mobilize private

resources for the purpose of financing the Construction, Operation and Maintenance of

infrastructure and development projects normally financed and undertaken by the Government.
Objectives of the Study

This Preparatory Study will verify the necessity and validity of the Project, and it will

conduct a feasibility study including a preliminary design and quantity survey. It will also

investigate solutions related to lessons and recommendations from the past railway transportation

projects in Manila metropolitan area and examine efficiency and sustainability in railway

business operations. In addition,as infrastructure projects are being planned and implemented

under PPP schemes following the direct instructions from the Government of the Philippines, in

this study, the feasibility of realizing the Project under a PPP scheme, and in particular attention

to the probability of assistance from Japanese ODA, will be investigated. This study is, as stated

above, to pave the way for possible ODA and PPP mixed implementation scheme by evaluating

feasible alternatives for the realization of the Project.