World Bank Approves US$275M Financing for Better Sanitation Services in Metro Manila

May 29, 2012

The World Bank’s Board of Executive Directors approved a US$275 million financing for a project that will improve wastewater collection and treatment practices in several catchment areas of Metro Manila and help improve Manila Bay’s water quality.

Called the Metro Manila Wastewater Management Project (MWMP), this project will support investments of the two water concessionaires – Manila Water Company, Inc. and Maynilad Water Services, Inc. – to increase collection and treatment of wastewater from households and other establishments in the metropolis. As the borrower of the World Bank loan, Land Bank of the Philippines will make available the loan proceeds to the two water concessionaires.
 
Finance Secretary Cesar Purisima welcomed the approval of the new financing, saying the project will boost the country’s efforts to clean up the bodies of water around Metro Manila.
 
“Water quality improvements in rivers and other water channels in and around the metropolis including Laguna de Bay and Manila Bay will help to improve the environment, and eventually enhance recreational and tourism opportunities,” said Secretary Purisima.
 
Metro Manila generates about 2 million cubic meters of wastewater every day. Without adequate sewerage facilities, only around 17 percent of this volume gets treated before being discharged into water channels in and around the metropolis, which end up mostly in Manila Bay.
 
To address this problem, both Manila Water and Maynilad have planned a 25-year program for ensuring 100 percent wastewater collection and treatment for Metro Manila and this project will support their efforts.
 
“MWMP will help both concessionaires embark on this ambitious program by supporting investments in selected catchment areas, thus addressing the growing needs for improved wastewater management and sanitation in Metro Manila,” said Land Bank President and Chief Executive Officer Gilda E. Pico.
 
With a total population of almost 12 million people, Metro Manila is located in the Laguna Lake-Pasig River-Manila Bay corridor. Interconnected with more than 30 tributaries, most of these bodies of water are highly polluted.
 
In December 2008, the country’s Supreme Court passed a landmark decision mandating the clean up, rehabilitation, and restoration of Manila Bay’s water quality to levels fit for recreation.
 
“Restoring the quality of Metro Manila’s bodies of water and eventually Manila Bay is going to be a long process but I believe this project is one huge step towards achieving this goal,” said Ms. Pico.
 
The project has two components, namely:
  • Investments by Manila Water (US$193.4 million) comprising a sewage treatment plant and associated sewage lines covering North and South Pasig;
  • Investments by Maynilad (US$178.3 million) in sewage treatment plants and associated wastewater conveyance systems in Quezon City, Pasay, Alabang, Muntinlupa, Valenzuela, and a septage treatment plant in the southern part of Metro Manila..
 
World Bank Country Director Motoo Konishi said the project is part of the Bank’s broader program of support for Metro Manila urban renewal which includes work on flood management, disaster risk management, and slum upgrading.
 
Mr. Konishi said that inadequate sanitation imposes severe costs on the economy and the population. Economic losses from inadequate sanitation nationwide—due to health costs and impacts on water quality, tourism, and welfare of the population—are estimated to be around 1.5 percent of Gross Domestic Product (GDP).
 
“The health of poor families, especially their young children, suffers the most from lack of proper wastewater treatment facilities and poor sanitation. Projects like these are important for achieving inclusive growth,” said Mr. Konishi.

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