Philippines : Davao Public Transport Modernization Project

Sovereign Project | 45296-006

The project will establish a modern public bus transport system in Davao City, the third largest city in the Philippines, with modern electric buses and Euro-5 standard diesel buses, standardized operations and reliable timetables, an intelligent transport system to support bus operation, designated bus stops with shelters and lighting, and designated bus lanes in selected road sections. The project is part of the efforts of the Department of Transportation (DOTr) to improve the public transport system in the Philippines by creating a reliable, safe, and comfortable passenger experience and by reducing air pollutants and greenhouse gas emissions.

Project Details

Project Name
Davao Public Transport Modernization Project
Project Number
45296-006
Country / Economy
  • Philippines
Project Status
Active
Project Type / Modality of Assistance
  • Loan
  • Technical Assistance
Source of Funding / Amount
Loan 4324-PHI: Davao Public Transport Modernization Project
Source Amount
Ordinary capital resources US$ 1,014.69 million
Loan 8449-PHI: Davao Public Transport Modernization Project
Source Amount
Green Climate Fund US$ 50.00 million
Loan 8450-PHI: Davao Public Transport Modernization Project
Source Amount
ASEAN Infrastructure Fund US$ 10.00 million
TA 10120-PHI: Road Transport Project Implementation Support and Institutional Strengthening
Source Amount
Technical Assistance Special Fund US$ 500,000.00
Green Climate Fund US$ 500,000.00
Operational Priorities
  • OP1: Addressing remaining poverty and reducing inequalities
  • OP2: Accelerating progress in gender equality
  • OP3: Tackling climate change, building climate and disaster resilience, and enhancing environmental sustainability
  • OP4: Making cities more livable
  • OP6: Strengthening governance and institutional capacity
Sector / Subsector
  • Transport / Urban public transport

Gender
Effective gender mainstreaming
Description

The project will establish a modern public bus transport system in Davao City, the third largest city in the Philippines, with modern electric buses and Euro-5 standard diesel buses, standardized operations and reliable timetables, an intelligent transport system to support bus operation, designated bus stops with shelters and lighting, and designated bus lanes in selected road sections. The project is part of the efforts of the Department of Transportation (DOTr) to improve the public transport system in the Philippines by creating a reliable, safe, and comfortable passenger experience and by reducing air pollutants and greenhouse gas emissions. The system will (i) establish bus operation concession arrangements, engaging private bus operators with performance-based contracts; (ii) rationalize about 670 km of bus routes from more than 120 PUJ routes currently into about 30 routes, with four levels (i.e., metro Davao, Davao inter, Davao feeder, and Davao local), which will carry about 800,000 passengers per day; (iii) procure about 1,100 more energy-efficient buses that will be leased out to bus operators, of which 380 will be articulated electric buses to service metro Davao routes, while small and regular-sized Euro-5 standard diesel buses will service other bus routes; (iv) construct about 1,000 bus stops along bus corridors with shelters to protect passengers from the weather; (v) construct five bus depots and three bus terminals, and establish a bus driving school; (vi) implement minor road improvements, including identifying designated bus lanes for selected road sections, creating queue-jump lanes for buses, building pedestrian crossings near bus stops, and improving sidewalks near bus stops; and (vii) establish an ITS including bus priority traffic signaling; a bus operation control center; automatic fare collection system; and Wi-Fi connection in buses, terminals and depots, and other public waiting areas.

The project will not only create an efficient, reliable, safe, and environmentally friendly public transport system, but will also incorporate the Philippines' first ever just transition program for affected people by providing a comprehensive social development program.

Project Rationale and Linkage to Country/Regional Strategy

Davao City, with a population of 1.78 million people, is the third largest city in the Philippines. The strong growth in the Davao region (8.1% average annual economic growth during 2014-2019) has boosted demand for travel across the expanding urban area. Davao City has no rail transport system, and public transport relies on small vehicles, including jeepneys, filcabs (vans modified for ride sharing), tricycles, motorbikes, taxis, and other utility vehicles. Public utility jeepneys , including jeepneys and filcabs, serve as the backbone of public passenger transport. Most buses only operate between cities and do not provide intracity transport. Public transport accounts for 80% of trips within the city but fails to keep up with changing travel demands and routing patterns because of fragmented ownership of vehicles and franchises. As a result, severe congestion as well as vehicular pollution have been increasing, particularly over the last 10 years. Vehicular congestion has reduced travel speeds in the central business district of Davao City to less than 10 kilometers (km) per hour at peak times. The opportunity cost in the form of lost income has also been increasing over time.

PUJs are privately owned, with 90% of them on a single owner-operator basis, making it difficult to rationalize routing and create a streamlined public transport network. Also, PUJ drivers tend to wait until their PUJs are full before traveling their routes, resulting in unpredictable scheduling and blocked road lanes during peak hours. Further, there are usually no designated stops to board or alight PUJs, and the back door of PUJs cause passengers to walk directly on the carriageway of roads, creating safety hazards. According to the National Emissions Inventory conducted in 2018 by the Department of Environment and Natural Resources, the majority (74%) of air pollutants in the Philippines came from mobile sources such as PUJs, cars, motorcycles, trucks, and buses. In particular, PUJs emit large amounts of particulate matter per vehicle kilometer. In 2017, the DOTr issued the omnibus guideline on the planning and identification of public road transportation services and franchise issuance to promote reliable, safe, accessible, environmentally friendly, and comfortable public utility vehicles, which requires public transport route planning, designated stops, a curbside door for passengers, and engines complying with Euro-4 or better emission standards. A nationwide transition has been gradually under way, but it needs to gain momentum. In Davao City, PUJs currently emit 232,000 tons of carbon dioxide equivalent (tCO2e) per year, which can be significantly reduced by modernizing public transport in the city.

The project will support the government to achieve its strategic targets in the transport sector under the National Transport Policy, which focuses on (i) resource generation and allocation (ii) criteria for the preparation of agency plans, programs, and projects; (iii) cost recovery; (iv) regulation of passenger transport; (v) improvement of urban transport; (vi) support to other sectors; and (vii) governance. The transport sector development plan is outlined in the Philippine Development Plan 2023-2028, which identifies shortage of road-based public transportation as one of the main problems in connectivity in the country. The project is also fully consistent with the omnibus guideline with respect to boosting reliability, safety, accessibility, environmental soundness, and comfort of the proposed bus system. The project will also contribute to the country's first Nationally Determined Contribution, which sets a 75% greenhouse gas emission reductions and avoidance target by 2030 as part of the Philippines' commitment under the Paris Agreement on Climate Change. The city government of Davao has shown strong commitment to improving public transport management by (i) amending its comprehensive transport traffic code to strengthen the legal and regulatory framework for public transport, and (ii) developing a public safety and security command center that integrates several city operations into a single system, which enhances safety and security of public transport uses.

Impact

Inclusive connectivity though the mass transport network in Davao City achieved.

Project Outcome

Description of Outcome

Reliability, efficiency, and environmental impact of public transport improved

Progress Toward Outcome

Implementation Progress

Description of Project Outputs

A modern bus system developed

Institutional capacity strengthened

Social Development Program delivered

Status of Implementation Progress (Outputs, Activities, and Issues)
Geographical Location
Davao City

Safeguard Categories

Environment
B
Involuntary Resettlement
A
Indigenous Peoples
B

Summary of Environmental and Social Aspects

Environmental Aspects
Safeguards due diligence ongoing. Small environmental effects are expected due to the construction of depots/terminals and bus stops on the roads.
Involuntary Resettlement
Safeguards due diligence ongoing. The land for depots/terminals will be required. The locations are being finalized.
Indigenous Peoples
Safeguards due diligence ongoing

Stakeholder Communication, Participation, and Consultation

During Project Design
The main stakeholders groups are the city officials in Davao, public transport owners and/or operators, and passengers. The city officials and passengers will directly benefit from improved management and public transport services. The owners and/or operators could benefit through enhanced services and revenue streams, but could also be negatively impacted by the transition to a modern public transport system. To address the potential negative impact on owners and/or operators, the project preparatory TA will assess needs and prepare livelihood components for inclusion in the project.
During Project Implementation
The project will introduce new forms of performance-based contracts for public transport service operations. Such contracts will include a passenger feedback and measurement system ensuring that the passengers are fully involved in the process and have an active and direct involvement in the project outcomes.

Business Opportunities

Consulting Services
See above.
Procurement
All contracts will be procured in accordance with ADB's Procurement Policy (2017, as amended from time to time) and Procurement Regulations for ADB Borrowers (2017, as amended from time to time). The proceeds of the loan are intended to be used for the procurement of the works and consulting services using open competitive bidding procedure. Please refer to the project website, Tenders section, for the advance contracting notice, and specific procurement notices issued. ADB approval of advance contracting will not commit ADB to subsequently approve the project or to finance the procurement costs. Project website link: https://www.adb.org/projects/45296-006/main

Contact

Responsible ADB Officer
Kimura, Shuji
Responsible ADB Department
Sectors Group
Responsible ADB Division
Transport Sector Office (SG-TRA)
Executing Agencies
Department of Transportation

Timetable

Concept Clearance
10 Aug 2015
Fact Finding
14 Jun 2021 to 22 Feb 2022
MRM
14 Oct 2022
Approval
29 Jun 2023
Last Review Mission
-
Last PDS Update
29 Jun 2023

Funding

Loan 4324-PHI

Milestones
Approval Signing Date Effectivity Date Closing
Original Revised Actual
29 Jun 2023 01 Jul 2023 08 Aug 2023 30 Jun 2030 - -
Financing Plan
  Total (Amount in US$ million)
Project Cost 1,650.78
ADB 1,014.69
Counterpart 636.09
Cofinancing 0.00
Loan Utilization
  Date ADB Others Net Percentage
Cumulative Contract Awards 02 Jul 2024 324.56 0.00 32%
Cumulative Disbursements 02 Jul 2024 0.00 0.00 0%
Status of Covenants
Category Sector Safeguards Social Financial Economic Others
Rating - Satisfactory - Satisfactory - Satisfactory

Loan 8449-PHI

Milestones
Approval Signing Date Effectivity Date Closing
Original Revised Actual
29 Jun 2023 01 Jul 2023 15 Sep 2023 30 Jun 2026 - -
Financing Plan
  Total (Amount in US$ million)
Project Cost 50.00
ADB 0.00
Counterpart 0.00
Cofinancing 50.00
Loan Utilization
  Date ADB Others Net Percentage
Cumulative Contract Awards 02 Jul 2024 0.00 0.00 0%
Cumulative Disbursements 02 Jul 2024 0.00 0.00 0%

Loan 8450-PHI

Milestones
Approval Signing Date Effectivity Date Closing
Original Revised Actual
29 Jun 2023 01 Jul 2023 08 Aug 2023 30 Jun 2026 - -
Financing Plan
  Total (Amount in US$ million)
Project Cost 10.00
ADB 0.00
Counterpart 0.00
Cofinancing 10.00
Loan Utilization
  Date ADB Others Net Percentage
Cumulative Contract Awards 02 Jul 2024 0.00 0.00 0%
Cumulative Disbursements 02 Jul 2024 0.00 0.00 0%

TA 10120-PHI

Milestones
Approval Signing Date Effectivity Date Closing
Original Revised Actual
29 Jun 2023 20 Oct 2023 20 Oct 2023 30 Jun 2026 - -
Financing Plan/TA Utilization
ADB Cofinancing Counterpart Total
Gov Beneficiaries Project Sponsor Others
500,000.00 500,000.00 0.00 0.00 0.00 0.00 1,000,000.00
Cumulative Disbursements
Date Amount
02 Jul 2024 64,785.14

Project Data Sheets (PDS) contain summary information on the project or program. Because the PDS is a work in progress, some information may not be included in its initial version but will be added as it becomes available. Information about proposed projects is tentative and indicative.

The Access to Information Policy (AIP) recognizes that transparency and accountability are essential to development effectiveness. It establishes the disclosure requirements for documents and information ADB produces or requires to be produced.

The Accountability Mechanism provides a forum where people adversely affected by ADB-assisted projects can voice and seek solutions to their problems and report alleged noncompliance of ADB's operational policies and procedures.

In preparing any country program or strategy, financing any project, or by making any designation of, or reference to, a particular territory or geographic area in this document, the Asian Development Bank does not intend to make any judgments as to the legal or other status of any territory or area.


Safeguard Documents See also: Safeguards
Safeguard documents provided at the time of project/facility approval may also be found in the list of linked documents provided with the Report and Recommendation of the President.


Evaluation Documents See also: Independent Evaluation

None currently available.


Related Publications

None currently available.


The Access to Information Policy (AIP) establishes the disclosure requirements for documents and information ADB produces or requires to be produced in its operations to facilitate stakeholder participation in ADB's decision-making. For more information, refer to the Safeguard Policy Statement, Operations Manual F1, and Operations Manual L3.

Requests for information may also be directed to the InfoUnit.

Tenders

Tender Title Type Status Posting Date Deadline
System Administration Consultant (SAC) Firm - Consulting Closed
Senior Public Transport Data Collection and Demand Modeling Specialist Individual - Consulting Closed
Social Development Specialist Individual - Consulting Closed
General Consultant Firm - Consulting Closed
45296: Davao Public Transport Modernization Project [OCB 22-002-7 Contract No. 05 and Contract No. 06] Invitation for Bids Closed
45296-006 PHI: Davao Public Transport Modernization Project (OCB 22-003-5) Invitation for Bids Closed
45296-PHI: Davao Public Transport Modernization Project [OCB 21-142-6] Invitation for Bids Closed
PHI 45296-006 Davao Public Transport Modernization Project Advance Notice Closed

Contracts Awarded

Contract Title Approval Number Contract Date Contractor | Address Executing Agency Total Contract Amount (US$) Contract Amount Financed by ADB (US$)
Design and Build Contract for Sasa and Sto. Nino E-Bus Depots Loan 4324 27 Mar 2024 Joint Venture of China Wu Yi Co., Ltd., Fujian Construction Engineering Group Co., Ltd., and Vicente T. Lao Construction | Philippines Department of Transportation 138,022,543.00 123,519,667.90
Design and Build for Toril Depot, Toril Terminal, Bunawan Terminal, and Calinan Terminal Loan 4324 19 Dec 2023 China International Water & Electric Corp. | 5/F, Two-Ecom Center, Mall of Asia Complex Bldg., Harbor Drive, District 1, Barangay 076, NCR 1300 Department of Transportation 73,766,376.26 66,338,528.12
Design and Build for Civil Works along Bus Stops, Bus Lanes, and Other Pedestrian Improvement Works Loan 4324 19 Dec 2023 China International Water & Electric Corp. | 5/F, Two-Ecom Center, Mall of Asia Complex Bldg., Harbor Drive, District 1, Barangay 076, NCR 1300 Department of Transportation 78,644,684.96 70,730,114.83
Design and Build Contract for Buhangin Depot, Calinan Depot, and Calinan Driving School Loan 4324 19 Dec 2023 China International Water & Electric Corp. | 5/F, Two-Ecom Center, Mall of Asia Complex Bldg., Harbor Drive, District 1, Barangay 076, NCR 1300 Department of Transportation 81,231,275.94 73,059,430.98

Procurement Plan

Title Document Type Document Date
Davao Public Transport Modernization Project: Procurement Plan Procurement Plans Oct 2023