Manila Water Co. Inc. said its subsidiary, Cebu Manila Water Development Inc. (CMWD) has terminated a bulk water supply contract with the Metro Cebu Water District (MCWD), effective at the start of this month.
In a disclosure to the Philippine Stock Exchange yesterday, Manila Water said the water supply contract with MCWD was first signed in December 2013 but did not provide any further explanations on the termination.
CMWD is a joint investment of the provincial government of Cebu and Manila Water Consortium Inc., which is a subsidiary of Manila Water Philippine Ventures Inc., which is also a wholly owned subsidiary of Manila Water.
Based on local reports, Cebu Governor Gwendolyn Garcia said under the agreement with MCWD, CMWD was o perating at a loss since it was stipulated that only P24.59 per cubic meter (cu. m.) will be paid for 20 years or until 2034 without escalation or increase.
Garcia said the current tariff rate was no longer enough to sustain CMWD’s operations. – Jed Macapagal
