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Economy

Work begins on first subway in congested Manila

But contractors say Philippine goal of completing line in 6 years is unrealistic

Motorists drive through a heavy traffic flow near a passing metro train along the main highway EDSA in Makati, Metro Manila, Philippines.   © Reuters

MANILA -- Ground was broken Wednesday on the first subway line in congestion-ridden Metro Manila, but contractors said the Philippine government's time-frame for construction was wildly optimistic.

As part of President Rodrigo Duterte's infrastructure push, the Philippines has set a target of finishing the 36-kilometer, 18-station line in six years. The hope is the subway will improve the commuting experience in the capital, where traffic jams are incessant and more than 12 million people have only four train lines spanning just over 70 kilometers.

The subway system -- estimated to cost 357 billion pesos ($6.9 billion) -- will be fully funded by a Japanese official development assistance loan. A consortium of Japanese engineering companies -- Shimizu Corp., Fujita Corp. and Takenaka Civil Engineering Co. -- and Philippine contractor EEI will design and build the subway's first three stations.

Philippine Transportation Secretary Arthur Tugade said at a groundbreaking ceremony that he expects this first phase will be completed by 2022.

But the Japanese contractors told Nikkei it would be tough to finish even the first three stations in three years. The earliest, they said, would be in 2024 -- two years after Duterte is due to step down from office. The 2022 target was set partly because Duterte wanted to see the trains running while still in power to boost his legacy.

The underground train will traverse Metro Manila's northern portion in Quezon City with terminals at the southern business district of Taguig City and Ninoy Aquino International Airport, the country's gateway.

The project is part of Duterte's ambitious "Build, build, build" infrastructure program -- a plan to spend over 8 trillion pesos on train lines, expressways and airports to boost economic growth. Japan and China are leading the financing and construction of the major train projects.

Duterte's spending over the past two years has pushed the ratio of infrastructure to gross domestic product to a record high. But the government overspent its budget in 2018 to breach the fiscal deficit ceiling for the first time in nine years.

Metro Manila loses around 3.5 billion pesos daily from congestion and its decrepit transport network, according to the Japan International Cooperation Agency. The cost is projected to rise to 5.4 billion pesos by 2035 if the situation isn't resolved.

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