EDITORIAL - Derailed

Nearly a decade after the Philippines and China agreed to build an 80-kilometer railway that was supposed to link northern Metro Manila to the Clark International Airport in Pampanga, the two countries have decided to scrap the contract awarded to a Chinese firm. The Philippines has agreed to repay China $593 million, which was supposed to finance the project that never got off the ground.

Allegations of corruption and overpricing hounded the North Rail project from the start. In March 2010, the Philippines suspended the deal with China National Machinery Industry Corp. pending a review of the deal. The Supreme Court later invalidated the contract, noting that it did not go through proper bidding.

Other countries are investing heavily in modern railway systems – whether on the ground, overhead or underground. Trains can be a big boost to logistics. Using trains to transport cargo can decongest traffic in Metro Manila. A high-speed train service between Metro Manila and Pampanga makes the Clark airport a viable alternative to the congested Ninoy Aquino International Airport. Government officials have dismissed the idea offhand, saying the distance is too far for a train service, but what other alternatives are there?

An interconnection between the North and South Rails was finished a long time ago. The railway system is needed particularly in areas where there is little space left to expand the road network. Like roads, railways can stimulate commercial activity and contribute to economic development. Railways can also be a boon to tourism. Other parts of the country can benefit from railways.

The government should review the factors that led to the North Rail mess and ensure that these are not repeated, especially with other projects financed through official development assistance. This is important if the government wants to tap ODA for its big-ticket public-private partnership projects. The nation needs a modern railway system, and it should not be derailed by the North Rail fiasco.