Philippines: Big-ticket projects hit speed bumps with 'right of way' (ROW) jams

Manila: Money is not a problem here.

That's when it comes to funding big-ticket projects.

Proof?

The country's central bank, BSP, has more cash (gross international reserves), than its counterpart in Spain, the country's ertwhile coloniser, and national reserves of other European nations like Denmark and Belgium.

With funding concerns out of the way, it's the right-of-way (ROW) snags that pose a significant challenge for the Asian country, impacting its ambitious infrastructure buildup.

ROW woes lead to inordinate delays and cost over-runs.

The Philippine court system, where ROW and public works-related corruption cases are eventually resolved, grinds ever so slowly, pushing back completion timelines.

It's a persistent snag.

Everyone pays for it, in terms of traffic snarls, public inconvenience, opportunity losses and low competitive edge vs their relatively richer Asean neighbours.

The country is estimated to bleed Php1.277 trillion per year ($22 billion) due to traffic jams in Manila, according to the Management Association of the Philippines (MAP, 2024).

Here are some standout multi-billion projects that got stuck in the ROW (Right-of-Way) traffic jams:

Delay: 3 years

The $1.54-billion MRT-7 project is intended to connect North Avenue in Quezon City to San Jose del Monte in Bulacan, MRT-7 has faced multiple delays due to ROW complications.

Initial construction began in 2016, but acquiring the necessary 33-hectare land for the San Jose del Monte station, depot, and "intermodal transport" terminal proved a huge headache.

While the original completion date was 2022, legal disputes over property ownership and valuation disputes further hindered progress. As of 2024, the project was 69.86 per cent complete, with partial rollout projected by 2025.

Delay: 1 to 2 years

The NSCR is now due in 2028, in a best-case scenario, instead of 2026 as originally planned. This rail project, estimated to cost $15.18 billion aims to connect regions from Clark in the north of Manila to Calamba in the south. Officials say ROW acquisition challenges have set back delivery dates.

It's the country's most expensive railway transport project.

Delays in securing necessary properties have escalated costs. The Department of Transportation (DOTr) has expressed concerns that continued ROW and budgetary issues could further delay the project's completion. The entire NSCR system is now expected to be completed in 2031.

Delay: Unknown

Envisioned as the Philippines' first underground rail system, the MMSP aims to alleviate traffic congestion in Metro Manila.

However, ROW issues, particularly in densely populated urban areas, have slowed down land acquisition and construction efforts.

The DOTr has highlighted that resolving these ROW challenges is crucial to prevent further delays in the subway's development.

It's now impossible to hit initial completion target dates.

Reason? Officials within the Department of Transportation (DOTr) said the aggressive completion target dates are now moonshots, because the agency has been hit with a legal opinion citing Republic Act 10752, or the ROW Act, over financing contracts.

The Act prohibits direct payments for informal settlers to be displaced by government projects; rather, it requires moving them to a relocation site "with basic facilities and services".

As for urban informal settlers (aka "squatters"), Philippine law (RA 10752) requires decent relocation site for them before any project could proceed.

Here's what it means: Going ahead with groundbreaking without a relocation plan for those affected, could open the floodgates of lawsuits.

The law prescribes "relocation with basic facilities and services". One court case slapped against the project will stall it, i.e. the engineering teams go idle for an unknown period of time.

This needs strategic approach to tackle such challenges before and after a project has been launched.

The new transport chief, Vivencio "Vince" Dizon, is undaunted by ROW snags. He has geared up to work together with local government units and the private sector to sort the ROW kinks.

Delay: Up to 10 years

In Cebu City, various infrastructure initiatives have experienced setbacks due to ROW concerns, according to local media.

For example, the Cebu City Police Office (CCPO) building. In 2015, the project received Php49.9 million budget, but the project remains stalled due to land ownership issues. On February 26, 2025, the city broke ground on the structure.

Another long-overdue project: the Php42.39-million Kalunasan Wastewater Treatment Facility. The project aims to address long-standing wastewater treatment issues from the Cebu City Jail, the Cebu Provincial Detention and Rehabilitation Center (CPDRC), and the "Operation Second Chance" facility. Since 2011, residents have endured the unbearable stench from these centres.

In 2020, Php20 million was allocated for the facility. Local media reported that Php100 million was allocated for the project, but "remained unimplemented". It's only recently that the project has been awarded to a contractor, with a 510-day completion period.

Such delays are compounded by budget constraints, inflation, and outdated cost estimates, necessitating project "realignments".

Delay: Unimplemented

Local media have reported several transport and road projects across the country are facing delays.

For example, the Commission on Audit (COA) has flagged the Department of Public Works and Highways-Bicol (DPWH-Bicol) for "inefficiencies and lapses" that led to delays or non-implementation of infrastructure projects valued at Php13 billion ($224 million).

In its 2023 audit report, dated July 30, 2024, released only in December, the COA flagged "shortcomings" in the implementation of projects that it said could have benefited the Bicol region, as per Rappler.

The report showed that 31 infrastructure projects worth Php560.7 million across four district engineering offices were left "unimplemented". These included:

The COA also listed 77 projects worth Php2.7 billion suspended across various district engineering offices and the regional office. The suspended projects included: (3 projects under the Regional Office, worth Php40.5 million; 3 projects in Albay 1st DEO, worth Php33.5 million; 3 projects in Albay 2nd DEO, Php197.2 million; 4 projects in Camarines Norte DEO, Php292 million; 10 projects in Camarines Sur 3rd DEO, Php315.5 million; 5 projects in Camarines Sur 5th DEO, Php128.3 million; 7 projects in Masbate 2nd DEO, Php295.8 million; 19 projects in Masbate 3rd DEO, Php197.5 million; 14 projects in Sorsogon 1st DEO, Php533.9 million; 9 projects in Sorsogon 2nd DEO, Php322.8 million.

Zamboanga Peninsula faces the worst backlog, with over Php5.5 billion in stipends arriving six months late. The COA recommends rescinding contracts, forfeiting bonds, filing court cases against contractors, and sanctions against National Irrigation Administration (NIA) officials.

In addition to inefficiency, the COA called out the DPWH in Bicol for “lack of proper supervision and monitoring,” which led to various technical defects in 32 projects in Camarines Sur, Catanduanes, and Masbate. 

The defects included “scaling, cracks, potholes, and unnecessary pay items for additional geotechnical investigations”.

Jailing of erring contractors is rare in the Philippines.

The primary laws governing ROW in the country are the Civil Code of the Philippines and Republic Act No. 10752, known as "The Right-of-Way Act."

Civil Code of the Philippines:

Articles 649 to 657 of the Civil Code outline the conditions under which a property owner may demand a legal "easement of right of way".

These provisions specify that an owner of an isolated estate, lacking adequate access to a public road, may request a right of way through neighbouring properties, subject to payment of just compensation.

The law provides that the easement should cause the least damage to the servient estate and, whenever feasible, be established on the shortest route to the public highway.

The Right-of-Way Act

Republic Act No. 10752 (The Right-of-Way Act): Enacted in 2016, this law facilitates the acquisition of private property for national government infrastructure projects.

It provides guidelines for determining just compensation, which is based on current market value, and outlines procedures for negotiation and, if necessary, expropriation.

The Act aims to streamline the acquisition process to prevent delays in the implementation of vital infrastructure developments.