Capitol renews partnership with Manila water

By: Morexette Marie B. Erram - CDN Digital | March 29,2022 - 05:40 PM
Capitol renews partnership with Manila water

MCW executives led by its President and Chairman, Melvin John Tan and Cebu Gov. Gwendolyn Garcia during the ceremonial signing of Settlement Agreement between the consortium and the Capitol over the Carmen bulk water supply facility last March 29, 2022. | Photo courtesy of Sugbo News FB Live Video

CEBU CITY, Philippines – The Cebu Provincial Government renewed its partnership with Manila Water Consortium Inc. (MWC) for the bulk water supply facility located in Carmen town, northern Cebu. 

Cebu Governor Gwendolyn Garcia and newly installed executives from MWC on Tuesday, March 29, 2022, signed a Settlement Agreement, putting an end to the dispute between the two parties. 

“It’s always productive to work together. It’s an auspicious day to celebrate,” said Melvin John Tan, chairman, and president of MWC. 

As part of the settlement, the Capitol’s interest share over the Cebu Manila Water Development Inc. (CMWD) was reinstated at 49 percent while MWC gets the remaining 51 percent. 


CMWD is the body managing and operating the bulk water supply facility in Carmen that supplies 35 million liters of water to the Metro Cebu Water District (MCWD). 

Both the provincial government and the consortium also agreed to revert the former’s Project Internal Rate of Return (PIIR) to 19.3 percent instead of 12.3 percent. 

PIIR refers to the profit the parties can earn from the project. 

Furthermore, the eight-page Settlement Agreement entitles the Capitol to receive P22 million of trust fund from MWC to finance corporate social responsibility (CSR) projects in the province, and additional P149 million as cash dividends for its share in the water supply project. 

While some policies were reinstated, the Capitol and MWC accepted some changes made in the joint investment agreement (JIA) they entered to ‘better reflect the current operational realities.’ 

These included increasing the capital expenditure for the project from P702 million to P1.3 billion, and the tariff rate from P13.95 to P24.59. 

In 2019, Garcia revoked the JIA between the Capitol and MWC after provincial consultants flagged some amendments made during the previous administration, saying these were disadvantageous to the province. These included decreasing the province’s PIIR from 19.3 percent to 12.3 percent. 

The governor even threatened to file cases against several MWC and CMWD executives over the matter. 

It was only in 2021 when talks of resolution between the Capitol and the MCW surfaced after the latter was under new management.



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TAGS: Carmen, Cebu Daily News, cebu news, manila water consortium

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