The Asian Development Bank (ADB) has granted approval for a $1 billion loan to fund the establishment of a city-wide public transport project in Davao City.
This initiative, a first of its kind in the country, aims to deploy electric bus fleets at scale, supporting the Philippines’ efforts to reduce greenhouse gas emissions and promote climate action.
Known as the Davao Public Transport Modernization Project, this endeavor marks ADB’s largest road-based public transport initiative in the Philippines. It is expected to serve as a pilot project for the overhaul of the country’s public road transport system.
The loan will support the procurement of a modern fleet of approximately 1,100 buses, with operations managed by the private sector through performance-based contracts.
The introduction of this new fleet is projected to reduce 60 percent of annual greenhouse gas emissions from public transport in Davao City, ADB said in a statement yesterday.
“The project is set to transform the quality of Davao City’s public transport and support the city’s rapid economic growth with a low-carbon and climate-resilient bus system,” said Shuji Kimura, ADB senior transport specialist for Southeast Asia.
“Not only will this support the Philippines’ climate goals, but it will help to improve the lives of vulnerable populations especially women and the young who use public transport daily,” Kimura added.
The groundbreaking project will cater to approximately 800,000 passengers per day.
It encompasses the construction of around 1,000 bus stops featuring bright lighting and shelters, as well as the establishment of five bus depots and three bus terminals. Additionally, the project will provide comprehensive bus driving training for the new system.
ADB said Davao City’s public transport experience will undergo a significant upgrade through the implementation of an intelligent transport system, which includes a bus location system, automatic fare collection systems, and Wi-Fi connectivity in buses, terminals and depots.
Following extensive consultations with government officials and community stakeholders, the project will incorporate a social development program aimed at mitigating any adverse impacts and risks associated with the restructuring of Davao City’s transport sector.
The program will provide livelihood opportunities for affected public utility jeepney drivers, operators, allied workers and their families.
The ASEAN Infrastructure Fund is co-financing the project with a $10 million loan under its ASEAN Catalytic Green Finance Facility (ACGF).
Additionally, the Green Climate Fund will contribute a $50 million loan under the ACGF’s Green Recovery Program. Both facilities are administered by ADB.
To ensure successful project implementation, a technical assistance grant of $1 million will be provided to support the Department of Transportation and the Davao City local government in developing staff capacities to oversee bus operations and overall project implementation.
