The Philippines may soon see its first manufacturing hub for magnetic levitation (maglev) trains, considered as the world’s fastest and most advanced commuter train, after the Cagayan Economic Zone Authority (Ceza) entered into an agreement with two Chinese firms to put up the facility.
In a news statement issued on Wednesday, Ceza said it has signed a tripartite memorandum of understanding (MOU) with Eminova Asset Management Ltd. and Hunan Goke Maglev Technology Development Ltd. for the establishment of a research and development center for production and training in Santa Ana, Cagayan. The project, if it pushes through, will be the first in the country.
Eminova will take the lead in the joint venture, as it will be primarily responsible for the financing of the start-up phase of the project. Hunan Goke, on the other hand, will be in charge of geological exploration, line track system design, power supply system design, operation control design system, design and production of vehicle systems, among others.
It will also establish research and development for training and production center, as well as ensure transfer of technology. It was also stipulated under the MOU that the venture would generate local employment.
Ceza Administrator and Chief Executive Officer Raul L. Lambino said the initial project cost is around $1 billion. This will be for the research and production models of maglev trains that are known to run on low noise and without friction and vibration.
“We need to be aggressive and innovative in promoting our competitive edge in the free port, [as] we have relatively cheap labor, highly skilled workers, vast tracts of unused lands and attractive fiscal incentives,” Lambino added.
The maglev production line in Cagayan is penciled to roll out light rail vehicles, as well as medium- and high-speed trains that can travel at 200 km to 400 km per hour. It will be supplied to Southeast Asian economies, including the Philippines.
Eminova is a Hong Kong-based independent investment fund managing Australian and European finances. On the other hand, Hunan Goke is the second but now the largest maglev line builder in the world.