What happened to the Philippine Railway Company?

Cebu City Mayor Mike Rama last week asked just what happened to the pre-war railroad company that reached Argao in the south and Danao in the north (not Bogo as reported in another newspaper).

The question is as timely as today’s date, June 12, which we celebrate as our day of independence. For it was also on this day in 1905 that former US governor-general to the Philippines and secretary of war (later US president) William Howard Taft issued invitations for companies and individuals to bid for the establishment of a railway company in Cebu and Iloilo.

After an initial failure of bidding was announced on December 20 that same year, a second call was made shortly. And on January 20, 1906, a formal proposal was submitted by what would later be called the Visayan Syndicate, which was composed of the big names in the US railroad industry, namely: Cornelius Vanderbilt, J.G. White, and Charles M. Swift together with their financiers, the International Banking Corp., H.R. Wilson and Heidelbach, and Ickelheimer and Co.

Two months later, on March 5, 1906, the Philippine Railway Company (PRC) was formally incorporated under the laws of the state of Connecticut with an initial capital of 10 million pesos (five million dollars at the time). And in quick succession, things fell into place. The following day, the Philippine Railway Construction Company (PRCC) was also formally incorporated under the laws of the state of New York, with an initial capital of two million pesos (one million dollars).

A day later, or on March 7, 1906, an agreement was inked between PRC and PRCC for the latter to buy the government franchise as well as rights of way and then construct the railroad on behalf of the PRC for the total cost of 9,998,000 pesos, leaving 1,000 pesos of its paid-up capital. (The equivalent of these amounts would run into billions of pesos in today’s exchange rate.) The following day, March 8, 1905, the assignment of the railway to PRC was quickly signed. Work then began shortly in Cebu and Iloilo.

The rest is history. In July 1907, the first of the coal-fired short-gauge trains began plying the railroad initially from the central station in Cebu City to Carcar in the south to Danao in the north. In September that same year, the southern end of the rail reached Argao and stopped there. Plans were then drawn up to extend the Carcar rail to Barili in the west, but the terrain was too dangerous and passenger and freight traffic too minimal to be viable.

Where was the central station? It was somewhere in the vicinity of where the Development Bank of the Philippines and Asian College of Technology are today.

This probably explains why Junquera, very near the central station, ended up as a red light district as in other countries where you find such an industry beside or near a central train station. If the University of San Carlos did not build its first campus between the two, that place would have also been part of the red light district.

PRC operated the railroad in Cebu and Iloilo between 1907 and up to the outbreak of World War II. The PRC was the epitome of forward planning and visioning that marks the American drive to success. For it operated trains in Cebu at a time when it hardly had a riding population. You see, everyone loved to walk from town to town during those days.

In fact, even as late as 1911, the Bureau of Public Works was still busy planting Acacia trees to line the provincial roads for the simple reason that the walking public needed to be shaded while going through the network of what were then called macadam roads. (I suspect these roads were called macadam because they were nothing more than dirt roads paved with limestone from the main quarry in Danao that were crushed to the size, shape and color of macadamia nuts grown in Hawaii that reach us even today as expensive pasalubong often wrapped in chocolate.)

The trains eventually won the public over and a steady riding population, together with cargoes of vegetables and fruits from the south and coal from Danao (which reached down to the port area for use by ships) giving the company a steady income.

If it was making money, why did the trains stop running in Cebu? Due to the limited space in this column, I will be able to answer this next week.