THE Land Bank of the Philippines (LandBank) has extended a credit line to the Light Rail Transit Authority (LRTA) to partially settle its contractual obligations to Light Rail Manila Corp. (LRMC).
The state-run bank signed a credit line agreement with the LRTA to help settle the government’s remaining P3.6-billion obligations to LRMC, the private operator of the Light Rail Transit Line 1 (LRT-1).
Under the agreement, LandBank will provide financing to cover the amount needed to settle the government’s obligations to LRMC, including fare deficit payments and reimbursements.
The LRMC took over the LRT 1 in 2015.
The unresolved claims eventually drove the company to seek international legal recourse. The LRMC filed a request for arbitration against the DOTr and the LRTA before the International Chamber of Commerce, seeking compensation for delayed fare adjustments covering 2016, 2018, and 2020, as well as claims for the difference between the stipulated fare and the approved fare under the concession agreement.
‘We hope that as we settle our obligation with the private concessionaire, we will see more improvements on their services, including structural upgrades, digitalization, and reliability of the rail line,’ Transport Secretary Giovanni Z. Lopez was quoted in a statement as saying.
LandBank President and CEO Lynette V. Ortiz said the agreement underscores the government’s commitment to honoring its obligations and strengthening public-private partnerships in the transport sector.
‘This loan facility represents a deliberate action by the National Government, through the LRTA and the DOTr, to fulfill its commitments and maintain strong and credible partnerships with its development partners,’ Ortiz was quoted as saying in the statement.
According to the statement, the LandBank views the agreement as complementing ongoing government efforts under a new program that supports alternative transport services to help cushion commuters against the impact of fluctuating fuel prices.
The DOTr has been ordered to settle its duties to private concessionaires to ensure reliable, safe and commuter-centric service for passengers.
‘Thousands of commuters ride the rail line every day. So we owe it to our commuters to provide them with quality and efficient service at masiguro ang kanilang kaligtasan,’ Lopez said.
The agreement between the three parties was signed by Ortiz and LRTA Administrator Hernando T. Cabrera, witnessed by Lopez, LRTA OIC-Deputy Administrator for Administrative Jose Jobel V. Belarmino and LandBank Executive Vice President Charlotte I. Conde.