NEDA tags Jalaur Dam as ‘problematic’ due to delays

By Rjay Zuriaga Castor

The National Economic and Development Authority (NEDA) has flagged the Jalaur River Multi-Purpose Project Stage II (JRMP II) in Calinog, Iloilo as one of the “problematic” projects funded by official development assistance (ODA).

In its latest ODA Portfolio Review, NEDA has classified JRMP II as an “Actual Problem Project’ since 2021, citing unresolved issues that have placed it in either the Early Warning Stage or Critical Stage.

The project has experienced significant delays due to common implementation challenges, including right-of-way acquisition, procurement problems, and regulatory compliance, according to NEDA’s assessment based on ten key indicators.

JRMP II was among the 45 projects identified as problematic by NEDA and is the only ODA-funded project by the National Irrigation Administration (NIA) on the list.

“These challenges were exacerbated by health and logistical restrictions during the COVID-19 pandemic,” NEDA said.

It added that the situation of the JMRP II was further complicated by the government’s limited fiscal space, as resources were reprioritized to address the pandemic.

“Additional delays were experienced due to inadequate appropriations for loan proceeds, or in some cases, the non-approval of proposed budgets in the National Budget starting in 2022 for these ODA-funded projects,” NEDA stressed.

With the long-standing bottlenecks in its implementation, NIA requested for a restructuring of the project which was approved by NEDA in 2023.

Specifically, NIA requested for change in cost and scope, implementation period and loan validity extension, and reallocation due to alteration of the design of the highline canal.

The design of the 81-kilometer high line canal, the main conveyance structure of JRMP II, was changed from a double barrel cut and cover structure to a tunnel structure with a total length of 1,532 meters.

The restructuring was also due to the increase in cost of land valuation; cost incurred due to NIA’s compliance to the post-conditions of the Environmental Compliance Certificate and conduct of community consultations and information drive; and additional works and actual site condition.

NEDA also noted that NIA sought extensions for the project’s implementation due to adverse weather, delays in issuing a Gratuitous Special Use Permit, and the continuing impact of the COVID-19 pandemic.

In 2012, the government signed an P8.96 billion ($207.88 million) loan agreement with the Export-Import Bank of Korea to finance the second stage of the project which was stalled since the first phase was completed in 1980.

The project has a total budget of P11.2 billion, of which P8.96 billion would come from the Korean Eximbank loan proceeds while P2.26 billion will be the government’s counterpart fund.

In July 2023, President Ferdinand Marcos Jr. approved modifications in the implementation of the project which include an extension of the project implementation period and loan validity.

From its original completion date of February 9, 2023, the project implementation period was moved to September 25, 2024, and the loan validity was likewise moved to March 25, 2025, from its original schedule of August 9, 2023.

Apart from time extension, Marcos also approved NIA’s request for an increase in project cost of P8.4 billion pesos.

The increase was attributed to factors such as inflation, foreign exchange trends, taxes and customs duties, and additional requirements for project implementation.

Marcos inaugurated the Jalaur Dam earlier in July, describing it as a “benchmark” project due to its scale and significance.