By Benjamin Cuaresma
MANILA — Baguio City will pilot a proposed jeepney modernization model designed to shift vehicle financing risks away from drivers and transport cooperatives, following World Bank Group estimates that ₱5.22 billion in cooperative loans have defaulted.
World Bank Group senior transport specialist Bowen Wang presented the proposal during a public transport modernization convention on Friday, outlining a system that would allow traditional jeepneys to remain operational while the city transitions to modern, electric-powered vehicles.
Under the proposed arrangement, local governments or private leasing firms would finance vehicle purchases and provide spare parts. Transport groups could acquire the units through lease-to-own agreements, with payments covered by long-term service contracts with the city.
The model would also allow local governments to manage routes and compensate drivers and other transport workers based on performance, Wang said.
He cited World Bank estimates showing that approximately 60 percent of loans obtained by transport cooperatives through special lending facilities had gone into default.
Baguio will receive official development assistance from World Bank Group banks during the program’s first six years. The city must establish its own funding sources to sustain the initiative by the 12th year.
Mayor Benjamin Magalong said implementation was being developed for completion within six months following discussions with Transportation Secretary Giovanni Lopez.
However, Magalong acknowledged that the proposal would not resolve payment difficulties faced by transport groups that had already borrowed money to purchase modern jeepneys.
Meanwhile, members of transport group Piston protested outside the convention at Venus Parkview Hotel, carrying placards declaring, “No to World Bank Jeepney Phaseout.”
Magalong said existing borrowers’ financial difficulties would need to be raised with the Department of Transportation.
ia/xf
