Philippines: Over 13 Million People to Benefit from World Bank Support to Cleanup Laguna de Bay through Local Government Units

April 12, 2011

MANILA, APRIL 12, 2011—The World Bank’s Board of Executive Directors approved today a US$ 10 million loan for the scaling up of priority environmental subprojects implemented by the Local Government Units (LGUs) under the Laguna de Bay Institutional Strengthening and Community Participation (LISCOP) Project designed to improve the environmental quality of the Laguna de Bay and its watershed.

Specifically, the support will finance additional environmental subprojects including solid waste management facilities (material recovery facility, composting facility, and sanitary landfill), eco-tourism, wastewater treatment, and local drainage and flood control along the 24 river systems draining into Laguna de Bay, thus reducing pollution in the lake and preventing the degradation of its watershed.

LLDA General Manager Rodrigo Cabrera said that the World Bank support will enable LLDA and the LGUs to expand the gains achieved by the original US$10 million financing approved in 2004 for the LISCOP Project in terms of LGU and subproject coverage.

"Significantly, this World Bank support will further contribute to the environmental improvement of Laguna de Bay, Pasig River and Manila Bay as mandated by the Supreme Court," Mr. Cabrera said.

Half the original financing came from a World Bank loan (US$5 million) supporting priority environment and local flood control subprojects identified, proposed and implemented by LGUs. The other half (US$5 million) came from a grant from the Netherlands government supporting institutional strengthening within LLDA, LGUs, and other stakeholders and the modernization of LLDA’s regulatory and planning instruments such as the use of the environmental user fee system (EUFS) for industrial dischargers and the public disclosure program on environmental compliance and performance by the LGUs and industrial dischargers.

"LISCOP's support to LGUs has led to the upgrading of 23 out of the 41 LGU-operated open dumps into well-managed solid waste management facilities through the establishment of material recovery facilities (MRF), composting facilities and sanitary landfill," said Mr. Cabrera. "An assessment of 11 MRFs with composting has shown that these facilities have diverted about 500 metric tons of solid waste annually, which would have ended up in open dumps and the lake itself causing pollution and clogging of tributaries, canals and other waterways, hence exacerbating flooding."

Some LGUs have also installed wastewater treatment systems for their slaughterhouses that have been directly discharging untreated wastewater into the lake, he said.

"Laguna de Bay performs vital uses for Metro Manila and surrounding areas for fisheries, as source of water for irrigation, power generation, industrial cooling, recreation, domestic use, environmental services and, most importantly, as the future source of water supply for Metro Manila," said Mr. Cabrera. "With its economic and ecological significance, it is very important that we manage this valuable natural resource in a sustainable way."

Laguna de Bay region encompasses the whole provinces of Rizal and Laguna, the towns of Tanauan, Sto. Tomas and Malvar in Batangas, the towns of Silang, GMA and Carmona in Cavite; the City of Tagaytay in Cavite, Lucban in Quezon province and the cities of Marikina, Pasig, Taguig, Muntinlupa, Pasay, Caloocan, Quezon, Manila and the town of Pateros in Metro Manila. Official estimate places the total population of the Laguna de Bay region at 13.6 million with a projected annual population growth rate of 2.76%.

Mr. Cabrera said that the project has also strengthened LLDA's capacity, modernized its regulatory and planning instruments through the use and expansion of EUFS and improved its partnership with key stakeholders including the LGUs. (EUFS refers to the market-based policy instrument designed to encourage companies to invest in water treatment facilities, practice waste minimization as well as reusing, recycling and greener production techniques, thereby contributing significantly to the cleanup of Manila de Bay.)

He said that LLDA has expanded the application of the EUFS to more than 2,303 industrial firms from 1,080, thus exceeding the project target of 1,400 firms.

“A particularly noteworthy result of the expansion of the EUFS is the reduced average industrial biochemical oxygen demand (BOD) loading, from 24.34 to 1.29 metric tons per firm for those covered by the EUFS. Industries’ contribution to total BOD loading in the lake was reduced to only 11 percent from 40 percent in the pre-EUFS era, indicating that firms are shifting to more efficient and cleaner production technologies,” said Mr. Cabrera. (BOD refers to a standard method for determining the amount of organic pollution in water bodies.)

World Bank Country Director Bert Hofman noted that under LISCOP, the EUFS which has been launched and piloted in Laguna de Bay in 1997 was expanded in terms of regulated pollution parameters and industrial coverage. 

“The EUFS has led industry to invest in pollution abatement systems resulting in the drastic reduction of industrial pollution loading in the lake, while the revenues collected from EUFS allowed LLDA to invest more in environmental subprojects," said Mr. Hofman. "This innovation with EUFs could be replicated in other parts of the Philippines consistent with the 2004 Clean Water Act."

Mr. Hofman said the original project, despite its modest financing, is clearly yielding tangible results and effectively addressing serious environmental and institutional issues in and around the heavily populated Laguna de Bay.

"Over the longer term, improving the water quality of the Laguna de Bay would lead to significant increases in well being and incomes for the many poor people who depend upon the lake for livelihood such as fishing, eco-tourism and irrigation. It would also assure Metro Manilans of a clean, potable and adequate supply of drinking water,” said Mr. Hofman

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