The woman boards the train at about 6:15 p.m., her mind already dwelling on the comforts of her home after a full day’s work.

The train car is full to the brim; if the idiom “bursting at the seams” were literal, the coach’s doors would have been busted by now.

Passengers push at each other in a bid to find the best, although uncomfortable, position. Beads of sweat start to rush down the passengers’ faces.

The car is hot, although air-conditioning is working just fine, from too much body heat. The passengers are so close to each other that moving one’s hand is almost impossible.

From Ayala station in Makati City, the train winds on at 40 kilometers per hour to the next stop at Buendia, which is about a kilometer or two away.

The woman’s grip starts to weaken as her insides churn and her head feels like a water lily floating on a shallow pond.

Just before the jam-packed train, with almost a thousand commuters, stops at the Buendia station, her vision dims and she loses consciousness.

It took the personnel of the Metro Rail Transit (MRT) Line 3 quite some time to respond to the emergency. Passengers begin reviving the woman, who is probably in her mid-20s.

Possibly, she suffers from asphyxia, or the lack of oxygen in the body, likely as a consequence of the congestion in
the train. After all, she stands about 5 foot flat, and most of the passengers are taller than her. She is also thin, making her almost invisible in a mob of angry commuters.

By the time two men carried her out the train car, those waiting for the train to move to the next station start pushing each other to get inside the already-congested coaches, not minding what had happened.

The same thing continued on the next four stations, making one wonder how the 60-train fleet of the MRT services over 540,000 passengers daily.

Still, a lot of commuters would opt to ride the overworked train system than brave the traffic horrors along Edsa and C-5 Road—two of the major arteries in Metro Manila. A sea of red-and-yellow lights warmly would, in a literal sense, welcome passengers during rush hours, which doubles or even triples—the travel time from one point of Manila to another.

The same picture, only with different characters, could also be painted at the ports in Manila. A typical day would look like this: Containers all piled up, kilometric queues of trucks lined up for clearances and a slow-poke movement of vehicles in and out the two main sea terminals of the capital.

Port congestion has hounded Manila for almost a year now, with the Manila International Container Terminal (MICT) and the Manila South Harbor’s combined yard utilization figures typically within the mid-80s to the high-90s. The bottleneck continues and worsens due to the holidays.

The Ninoy Aquino International Airport (Naia), meanwhile, is no different. Its four terminals and runways already operate beyond their rated capacity, causing numerous cancellations or delays in flight operations—whether domestic or international.

The Japan International Cooperation Agency (Jica) even predicts that this year would mark the start of the main gateway’s dark days. The airport is expected to handle some 37.78 million passengers by year-end, way beyond its 30-million annual passenger capacity and a few notches up from its maximum capacity of 35 million passengers a year.

These, according to economists and businessmen, are signs that the $270-billion economy is overheating and characterized by the inability of existing infrastructure to accommodate fast-rising demand, causing inflation to spike.

Makati Business Club President Peter Angelo V. Perfecto said these logistical nightmares stem from the inability of governments—past or present—to anticipate the requirements of a rapidly expanding economy.

“Our transport infrastructure woes are rooted in a lack of long-term planning and a shared vision of where we want to see the country many years into the future,” he said. “The implications of poor planning are obvious and the results are what we [have to] contend today.”

Government underspending in critical infrastructure has caused many Filipinos to bear with congestion, which eats up an estimated third of their time that could have been spent for more productive undertakings. This has also become a stumbling block to economic growth, as this forces the economy to lose the much-needed momentum to meet the government’s growth target in 2014.

World Bank Senior Country Economist Karl Kendrick Chua said the country’s so-called investment deficit already total P950 billion, some 6.8 percent of the country’s local output measured as the gross domestic product (GDP). Infrastructure deficit, in particular, was estimated at P350 billion.

“This has resulted in monstrous traffic, flight delays and delays in importation,” he said.

European Chamber of Commerce of the Philippines External Vice President Henry J. Schumacher said the current state of infrastructure, particularly transport facilities, “would not be able to handle the fast-paced growth of the economy.”

Former Budget Secretary and Economist Benjamin E. Diokno shares this view, tagging the current facilities as “poor,” while enumerating woes that persist even as the economy continues to expand at a rapid pace.

“Poor infrastructure is a major constraint to growing. Power rates are high and its supply is unreliable. Water rates are expensive, too. Urban transit is inadequate and falling apart. The telco system is notoriously slow. All these are major disincentives to foreign direct investments,” he said.

Latest data from the Philippine Statistics Authority (PSA) show the total approved foreign investments (FDIs) in the first nine months of 2014 amounting to P91.8 billion, a 35.4-percent decline from the same period the year prior. In the third-quarter of 2014 alone, total approved foreign investments was almost halved to only P18.3 billion, from P32.9 billion in 2013.

The government projected FDI inflows in excess of $1 billion in 2014.

FDIs are investments placed by nonresidents in so-called bricks-and-mortar endeavors in the country, as opposed to portfolio investments that are speculative in nature and engaged in the Philippines only, as long as such placements present higher returns than placements elsewhere in the global marketplace.

At the same time, investments registered by the Philippine Economic Zones Authority increased by a mere 1.21 percent in 2014 as a consequence of the seven-month long port logjam in the capital, falling short of the 10-percent target for the year. Exports during the first 11 months of the year reached $40.518 billion, 8 percent below target. These are implications of a hurting economy that leads to lower competitiveness and lower productivity. “The competitiveness of the country suffers and it hurts the economy,” Schumacher lamented.

‘Playing catch-up’

“Infrastructure spending was not keeping up with the growth of the economy, and normally, there’s a computation of how much infrastructure spending should grow for every rate of growth of the economy. Right now, we are playing catch-up,” National Competitiveness Council co-Chairman Guillermo M. Luz said.

The country’s local output has been growing between mid-to-high single-digit rates, and logistical problems, such as congestions at the main trading gateways, could prove a stumbling block to economic expansion.

“It hampers economic growth. It is difficult to absorb more investments because of more congestion,” he lamented.

The country ranks “quite low” in terms of competitiveness in terms of infrastructure. Luz said current data show that the $270-billion economy’s infrastructure competitiveness is “still close to 100, which is a minor improvement, because, in the past, we were playing at the 105 to 110 ranks at the World Economic Forum.”

“We have seen little improvements over the past years, but at least we have stopped dropping. Investors measure our overall competitiveness, and we’re hoping to improve again this year, as the government ramps up infrastructure spending,” he said.

Borrow more, invest more

The economic implications of congestion in Metro Manila alone, Japanese consultants say, would also mean productivity losses in the Philippines. Should the government fail to address traffic woes by the year 2030, the Philippines stands to lose P6 billion daily in productivity losses.

But, if chronic transportation congestion were eradicated, or lessened in a major sense, Jica says the Philippines stands to generate P2.1 billion in savings from vehicle-operating costs.

The economic managers and businessmen alike agree on this, saying the government must increase its spending in terms of infrastructure, so as to further expand the economy and alleviate—if not erase—the logistical nightmares in and around the country.

“Government effort to narrow the infrastructure gap will ramp up construction, increase employment, create secondary activities and attract more investment opportunities. We should borrow money domestically to finance spending for public infrastructure,” Diokno suggests. Economists say the country needs to invest P600 to P700 billion each year in public infrastructures to achieve strong sustainable growth.

“Building the right infrastructure at the right time and with the right cost requires a better appreciation of what is the situation now and what is needed many years hence,” Perfecto adds.

Fortunately, the government has vowed to increase infrastructure spending over the last 18 months of the Aquino administration. It has earmarked P562.3 billion for public infrastructure this year. To be continued

“We are pumping in money to finance our infrastructure, because we know that it is spring to economic growth. If our roads are paved, the transport of goods and services to the market would be faster, improving businesses that create jobs, ultimately leading to comprehensive growth,” President Aquino said during his visit in Romblon this month.

For his part, Public Works Secretary Rogelio L. Singson said his office aims to increase infrastructure spending through 2016, explaining that the government has set its sights on spending the equivalent of 5 percent of GDP, totaling as high as $18 billion by 2016, from $4 billion in 2011.

“We commit that by 2016, all national roads and bridges, estimated to measure 32,000 kilometers, will have been paved,” he said.

PPPs to sustain infrastructure reforms

For Luz, the key to achieving the target of eradicating the logistical nightmares lies on two things: higher public infrastructure spending and quickly implementing the public-private partnership (PPP) projects.

“We should see a surge in infrastructure spending and PPP projects,” he said.

The key infrastructure program of the Aquino administration has made a good impression among its peers in Asia, due to its “sound policies and structure.”

Since its inception in 2010, the government has awarded only nine deals under the program, which has a robust pipeline of more than 60 projects. The government is currently auctioning off 11 contracts as of press time.

Diokno, however, was not too happy of the program, calling it a “disappointment.”

“The credibility of the Aquino administration will diminish as its term ends. Some contractors might choose not to participate and just wait for the next administration. You see the same companies competing for the various PPP projects. Their capacity may be near their limits,” he said.

But for PPP Center Executive Director Cosette V. Canilao, the government has done a great job in facilitating the program that seeks the help of the private sector in plugging the infrastructure gap in the Philippines.

“We have a lot of projects in the pipeline and we are seeing a lot of interest from foreign bidders. There are new players in our projects. Those that are already participating in our bids are large corporations which form consortiums, and they should really invest in our infrastructure,” she said.

The PPP chief said the Aquino government hopes that the next administration would continue implementing the key infrastructure thrust in order to address the infrastructure woes in the country.

“We all want the PPP program to be sustainable and to go beyond 2016. So what we are doing now is we’re strengthening the regulatory framework and making the process more efficient and fool-proof of the PPP Act,” Canilao added.

Essentially, the PPP Act is an amendment of the Build-Operate-Transfer (BOT) Law, which is the very cornerstone of the program.

“The technical working group meetings will start at the lower house on the 28th of January and on the Senate. We are talking with the Senate President and we’re hoping that their technical working committee meetings would start really soon,” Canilao said.

When approved, the PPP Act would institutionalize the Project Development and Monitoring Facility, the PPP Governing Board and the contingent liability fund. The proposed amendments include the separation of regulatory and commercial functions of government-owned and -controlled corporations and create a list of projects called “Projects of National Significance.”

By virtue of being included in the list of projects of national significance, projects will be “insulated” from local laws, among others, by local government units.

The proposed amendments also include allowing time-bound temporary restraining order and the extension of the period for the Swiss Challenge to six months from the current two-month period.

The amendments are seen approved within the term of President Aquino.

Address woes practically

More than increasing infrastructure spending for the next couple of months, Philippine Chamber of Commerce and Industry President Alfredo M. Yao said the government must also act quickly to address the woes in the country’s much-needed facilities.

“We need to work double time. These problems are a result of poor planning from past administrations—a confluence of poor planning. We should have improved our rail systems by this time, our airports should have been modernized, and our ports should have been improved,” he said.

The short-term measure addressing the congestion at Naia and the Manila-based ports, he said, should force the port operators and airlines to move to secondary gateways up north and down south.

“We have seaports in Batangas and in Subic which are ready. We just have to improve them, add more berths to lessen the queues. For the airport, we cannot really use our existing. We have a runway problem, so we have to bite the bullet. We have to get out from them and make an alternate airport in Naia. We really have to go to Clark, but the problem is we need a bus rail, or an airport rail that would run efficiently,” Yao, who owns a majority of budget carrier AirAsia Zest, said.

But more than forcing commercial airlines to get out of Naia, the government should exercise the political will to remove private planes out of the main gateway.

“If they would do that, Naia’s runway would improve by 20-percent to 30-percent. These planes should be transferred to Clark or Sangley. Imagine, these planes that carry only two to three passengers would have the same waiting time as a commercial airplane that carries 200 to 300 passengers. They should have the political will and power to do it,” Yao said.

Bear the consequence for now

Building the infrastructure now, Luz said, would mean further addressing the problem of congestion.

“We must accelerate building more infrastructures, but as we build the infrastructure at the same time, the public would have to suffer inconvenience because of the construction, but at least we could reap the benefits in the future,” he said.

At present, the government is building more bridges, paving more roads, and is trying to improve the state of the railways, aviation gateways, and seaports around the country, implementing the P4.76-trillion Roadmap for Transport Infrastructure Development for Metro Manila and its Surrounding Areas, otherwise known as the Dream Plan, crafted by Jica.

It lists the transport infrastructures the Philippines needs to remove potential losses and gain from prospective savings.

Some of the projects under the PPP program—a number of which have been awarded already—were under the Dream Plan, but almost five years into the Aquino administration, not one had been completed.

“We must understand that infrastructure projects have long gestation periods,” Canilao explained.

Slated for commercial operations is one of the smallest projects in the pipeline, the P2.01-billion Daang Hari-South Luzon Expressway Link, a four-kilometer thoroughfare awarded to Ayala Corp.

Luz said he has high hopes that the government would address these problems sooner or later, as this would have a direct impact on the over-all ranking of the Philippines in terms of competitiveness, which is a barometer that tells investors whether or not to risk their money in the Southeast Asian economy.

“Overall, we rank 52nd at the World Economic Forum. We used to be in the 80s three or four years ago. It’s a big improvement, imagine when we fix these logistical problems, imagine the increase,” Luz said.

The government and the private sector might be working closely to eradicate the congestion and help lessen the load of commuters, but that might be far from a hand’s reach as of the moment.

For now, the woman who passed out while riding the MRT could do with what is available, even if it means risking her life just to earn a living.

Source: Business Mirror